Chesapeake Energy Corporation Announces Pricing of $2.0 Billion Unsecured Term Loan
Chesapeake Energy Corporation (NYSE:CHK) today announced the pricing of
an unsecured five-year term loan facility in an aggregate principal
amount of $2.0 billion arranged by Bank of America, N.A., Goldman Sachs
Bank USA and Jefferies Finance LLC. The new facility, which will be
syndicated to a large group of institutional investors, was priced at
98% of par. Amounts borrowed under the new facility will bear interest
at LIBOR plus 4.50%. The LIBOR rate is subject to a floor of 1.25% per
annum. The new facility will rank pari passu with Chesapeake′s
outstanding senior notes and contingent convertible senior notes and
will mature on December 2, 2017. The new facility is non-callable in the
first year but may be voluntarily repaid in the second and third years
at par value plus a specified call premium and may be voluntarily repaid
at any time thereafter at par value. The new facility is expected to
close on November 9, 2012, subject to the execution of definitive loan
documents and the satisfaction of closing conditions.
Chesapeake will use the net proceeds of the new term loan facility to
fully repay the remaining outstanding borrowings under the company′s
existing May 2012 term loan facility and to repay outstanding borrowings
under the company′s corporate revolving credit facility. This loan will
enhance the company′s liquidity and financial flexibility as it
continues to execute its previously announced asset sales strategy and
will allow the future repayment of higher cost debt.
This news release includes 'forward-looking statements' that give
Chesapeake's current expectations. Although we believe the expectations
reflected in our forward-looking statements are reasonable, we can give
no assurance they will prove to have been correct. They can be affected
by inaccurate assumptions or by known or unknown risks and
uncertainties, and actual results may differ from the expectation
expressed. We may be unable to complete our previously announced planned
asset sales as scheduled or at all.Our planned asset sales may
not generate the proceeds needed to allow for the repayment of higher
cost debt.We caution you not to place undue reliance on our
forward-looking statements, which speak only as of the date of this news
release, and we undertake no obligation to update this information.
Chesapeake Energy Corporation (NYSE:CHK) is the second-largest
producer of natural gas, a Top 15 producer of oil and natural gas
liquids and the most active driller of new wells in the U.S.Headquartered
in Oklahoma City, the company's operations are focused on discovering
and developing unconventional natural gas and oil fields onshore in the
U.S.Chesapeake owns leading positions in the Eagle Ford,
Utica, Granite Wash, Cleveland, Tonkawa, Mississippi Lime and Niobrara
unconventional liquids plays and in the Marcellus, Haynesville/Bossier
and Barnett unconventional natural gas shale plays. The company also
owns substantial marketing and oilfield services businesses through its
subsidiaries Chesapeake Energy Marketing, Inc. and Chesapeake Oilfield
Services, L.L.C.Further information is available at www.chk.com
where Chesapeake routinely posts announcements, updates, events,
investor information, presentations and news releases.
Chesapeake Energy Corporation
Jeffrey L. Mobley, CFA, 405-767-4763
jeff.mobley@chk.com
or
John
J. Kilgallon, 405-935-4441
john.kilgallon@chk.com
or
Media
Contacts:
Michael Kehs, 405-935-2560
michael.kehs@chk.com
or
Jim
Gipson, 405-935-1310
jim.gipson@chk.com
