Chesapeake Prices Unsecured Term Loan

Chesapeake Energy Corporation Wednesday 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 percent of par. Amounts borrowed under the new facility will bear interest at LIBOR plus 4.50 percent. The LIBOR rate is subject to a floor of 1.25 percent 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.

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