CHK Working Page

STREET NOTES

CHK CRT Capital 12.22.2015

CHK Morningstar Report 12.22.15

CHK Valens Report 11.23.2015


COMPANY DOCUMENTS

Debt Exchange Results (12.21.15)


ANALYSIS/NOTES

January 24, 2016

Second Amendment to Credit Agreement 12.15.2015

  • “Additional Junior Lien Debt” may not exceed $4 billion, including exchange debt
  • “Additional Permitted Junior Lien Debt” may not exceed $2B:

“…no such Additional Permitted Junior Lien Debt may be issued prior to the date that the Borrower has exchanged Junior Lien Debt for its Contingent Convertible Senior Notes or senior notes issued pursuant to the Indentures, in each case puttable or due, as applicable, during 2017, 2018 or 2019, in an aggregate principal amount in excess of $2,000,000,000 and (ii) the aggregate amount of Additional Permitted Junior Lien Debt consisting of New Money Junior Lien Debt at any time outstanding shall not exceed $2,000,000,000.”

Intercreditor Agreement 12.23.2015

  • This document does not indicate how much, but CHK has 3L debt capacity. How on earth anyone can invest in the equity or USNs at this juncture requires mental gymnastics…

January 2, 2016

CHK Morningstar Report 12.22.15

  • Two key near-term events:
    • Final results of the debt exchange offer
    • Mid-April 2016 borrowing base re-determination
  • MS believes ‘mid-cycle’ WTI and Henry Hub prices are $64 and $4
  • Debt exchange overview
    • Initially offered up to $1.5B of 2L 8% 2022 notes
    • $2.8B of principal initially tendered, representing $1.7B of ‘new’ 2L notes
      • Only $352 million of principal due in next three years was tendered, however
    • Upped offer to $3B of ‘new’ 2L notes
  • Capital stack:
    • Unsecured senior notes due after 2016: $9,345 face value; $3,010 market value – 32.2% of face value
    • 2016 Unsecured senior note: $500 FV; $469 MV – 93.8%
    • 2037 convertible senior note (puttable 5/15/17): $1,168; $558 – 47.8%
    • 2038 convertible senior note (puttable 12/15/18): $347; $115 – 33.1%
    • Cumulative convertible preferred: $3,062; $490 – 16%

17M CHK MS Note Analysis 1.3.16

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