8-KOther Events

EXPAND ENERGY Corp 8-K Report (Jul 29, 2004)

Filed July 29, 2004For Securities:EXEEXEELEXEEWEXEEZ

Summary

Chesapeake Energy Corporation (Chesapeake) has announced the pricing of a private offering of $300 million in 7% senior notes due 2014. The notes are being offered and sold under Rule 144A, meaning they are not registered with the SEC and may only be traded among qualified institutional buyers. The primary intended use of the net proceeds is to finance a portion of pending acquisitions, specifically those of Bravo Natural Resources, Inc. and certain assets from Legend Natural Gas, LP, as well as to repay debt incurred for a prior acquisition. These acquisitions are expected to close in early August 2004. If the acquisitions do not close, Chesapeake plans to use the proceeds for general corporate purposes, including debt repayment or future acquisitions.

Key Highlights

  • 1Chesapeake Energy priced a $300 million private offering of 7% senior notes due August 15, 2014.
  • 2The offering is a private placement under Rule 144A, eligible for trading by qualified institutional buyers.
  • 3Net proceeds are intended to fund a portion of the pending acquisitions of Bravo Natural Resources and assets from Legend Natural Gas.
  • 4Funds will also be used to repay existing debt used for the acquisition of assets from Tilford Pinson Exploration.
  • 5The acquisitions of Bravo Natural Resources and Tilford Pinson assets are expected to close by August 2, 2004.
  • 6The Legend Natural Gas acquisition is anticipated to close by August 31, 2004.
  • 7If acquisitions do not close, proceeds will be used for general corporate purposes such as debt repayment or future acquisitions.

Frequently Asked Questions

The primary purpose of the offering is to finance a portion of Chesapeake Energy's pending acquisitions of Bravo Natural Resources, Inc. and certain assets from Legend Natural Gas, LP. Additionally, the proceeds will be used to repay outstanding amounts under the company's credit facility that were used to finance the acquisition of certain assets from Tilford Pinson Exploration, LLC.

No, these senior notes are being offered in a private placement and are not registered under the Securities Act of 1933. They are eligible for trading under Rule 144A, meaning they can be offered and sold only to qualified institutional buyers.

If the pending acquisitions do not close, Chesapeake Energy intends to use the net proceeds from the senior notes offering for general corporate purposes. This may include repaying outstanding debt or funding potential future acquisitions.

The acquisition of Bravo Natural Resources is expected to close by August 2, 2004. The acquisition of certain assets from Tilford Pinson Exploration, LLC has already been financed and its closing is implicitly assumed. The acquisition of certain assets from Legend Natural Gas, LP is expected to close by August 31, 2004.