OKLAHOMA CITY, May 3 /PRNewswire-FirstCall/ -- Chesapeake Energy
Corporation (NYSE: CHK) today announced that it intends to commence an
offer to exchange shares of its common stock for any and all of its
outstanding 86,310 shares of 4.125% Cumulative Convertible Preferred Stock
(the "Preferred Stock") (CUSIP Nos. 165167875/165167883 (144A)).
The number of shares of common stock to be exchanged for each share of
Preferred Stock (the "Exchange Ratio") will be fixed after 5:00 p.m. New
York City time on Tuesday, May 30, 2006, the Pricing Date, on the basis of
the applicable pricing formula set forth herein, and publicly announced
prior to the opening of trading on Wednesday, May, 31, 2006. The Exchange
Ratio will equal the sum of (i) 60.0555 shares of common stock, the number
of shares into which the Preferred Stock is presently convertible and (ii)
a number of additional shares of common stock equal to $89.19 divided by
the arithmetic daily volume-weighted average price of our common stock,
over an eleven day trading period beginning on May 15, 2006 and ending on
the Pricing Date. The exchange offer will be subject to a maximum of
64.5150 shares of common stock and a minimum of 61.9944 shares of common
stock per share of Preferred Stock.
The exchange offer will expire at 5:00 p.m., New York City time, on
Thursday, June 1, 2006, unless extended or earlier terminated by
Chesapeake. Holders may withdraw tendered shares of Preferred Stock at any
time before the exchange offer expires, or if not previously returned, a
holder may withdraw any tendered shares of Preferred Stock that are not
accepted by Chesapeake on or before June 29, 2006. The tender and
withdrawal of shares of Preferred Stock pursuant to the Offer held in
"street" name are subject to compliance with the appropriate procedures of
the automated tender offer procedures, or ATOP, system of The Depository
Trust Company.
The exchange offer will be made pursuant to an offer to exchange and
related letter of transmittal, copies of which may be obtained without
charge from the information agent for the exchange offer, Global Bondholder
Services Corporation, who may be reached at 866-924-2200 (US toll-free) and
212-430-3774 (collect). The exchange offer prospectus and other related
documents will also be filed with the Securities and Exchange Commission on
Schedule TO and may be obtained for free at the Commission's web site,
http://www.sec.gov . The exchange offer is subject to the satisfaction of
certain conditions.
Holders of Preferred Stock are urged to read the offer to exchange and
related letter of transmittal when it becomes available because it includes
important information.
The securities to be offered have not been and will not be registered
under the Securities Act and may not be offered or sold in the United
States absent registration or an applicable exemption from the registration
requirements of the Securities Act and applicable state securities laws.
This press release is not an offer to purchase or an offer to exchange or a
solicitation of acceptance of the offers to purchase or offer to exchange,
which may be made only pursuant to the terms of the applicable offer to
purchase or offer to exchange and related letters of transmittal.
Chesapeake Energy Corporation is the second largest independent
producer of natural gas in the U.S. Headquartered in Oklahoma City, the
company's operations are focused on exploratory and developmental drilling
and corporate and property acquisitions in the Mid-Continent, Permian
Basin, South Texas, Texas Gulf Coast, Barnett Shale, Ark-La-Tex and
Appalachian Basin regions of the United States. The company's Internet
address is http://www.chkenergy.com .
SOURCE Chesapeake Energy Corporation
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Related links:
http://www.chkenergy.com
CONTACT:
Jeffrey L. Mobley, CFA, Senior Vice President
- Investor Relations and Research, +1-405-767-4763, or
jmobley@chkenergy.com , or Marc Rowland, Executive Vice President
and Chief Financial Officer, +1-405-879-9232, or
mrowland@chkenergy.com , both of Chesapeake Energy Corporation
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