This excerpt taken from the CHK 8-K filed May 15, 2007.
[VINSON & ELKINS LETTERHEAD]
May 15, 2007
Chesapeake Energy Corporation
6100 North Western Avenue
Oklahoma City, Oklahoma 73118
Ladies and Gentlemen:
We have acted as counsel for Chesapeake Energy Corporation, an Oklahoma corporation (the Company), in connection with the offer and sale by the Company, of $1.0 billion aggregate principal amount of 2.500% Contingent Convertible Senior Notes due 2037 (Convertible Senior Notes) to be issued under an Indenture, dated as of May 15, 2007, (the Indenture) between the Company, the Subsidiary Guarantors and the Bank of New York Trust Company N.A. and the common stock of the Company upon the conversion thereof. Capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in the Indenture.
We have examined originals or copies, certified or otherwise identified to our satisfaction, of (i) the Registration Statement on Form S-3 (File No. 33-142720) (the Registration Statement) under the Securities Act of 1933, as amended (the Securities Act), (ii) the form of indenture (the Indenture) filed or incorporated by reference as an exhibit to the Registration Statement and (iii) such other certificates, statutes and other instruments and documents as we considered appropriate for purposes of the opinion hereafter expressed. As to any facts material to the opinion contained herein, we have made no independent investigation of such facts and have relied, to the extent that we deem such reliance proper, upon certificates of public officials and officers or other representatives of the Company.
In connection with rendering the opinion set forth below, we have assumed that (i) all information contained in all documents reviewed by us is true and correct; (ii) all signatures on all documents examined by us are genuine; and (iii) all documents submitted to us as originals are authentic and all documents submitted to us as copies conform to the originals of those documents.
Based on the foregoing, and subject to the assumptions, qualifications, limitations, and exceptions set forth herein, we are of the opinion that when such Convertible Senior Notes have been duly executed, authenticated, issued and delivered in accordance with the provisions of the Indenture upon payment of the consideration for such Convertible Senior Notes as provided for in the applicable definitive purchase, underwriting or similar agreement, such Convertible Senior Notes will be legally issued and constitute valid and legally binding obligations of the Company, enforceable against the Company in accordance with their terms, except as such enforcement is subject to (i) bankruptcy, fraudulent conveyance or transfer, insolvency, reorganization, moratorium and other similar laws relating to or affecting creditors rights generally and (ii) the application of general principles of equity (regardless of whether considered in a proceeding at law or in equity) including, without limitation, (a) the possible unavailability of specific performance, injunctive relief or any other equitable remedy and (b) concepts of good faith, reasonableness, fair dealing and materiality).
We express no opinions concerning (a) the validity or enforceability of any provisions contained in the Indenture that purport to waive or not give effect to rights to notices, defenses, subrogation or other rights or benefits that cannot be effectively waived under applicable law; or (b) the enforceability of
indemnification provisions to the extent they purport to relate to liabilities resulting from or based upon negligence or any violation of federal or state securities or blue sky laws.
The foregoing opinion is limited to the laws of the State of New York and the federal laws of the United States of America and we are expressing no opinion as to the effect of the laws of any other jurisdiction, domestic or foreign. The opinions expressed herein are given as of the date hereof, and we undertake no, and hereby disclaim any, obligation to advise you of any change in any matter set forth herein.
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of our name in the prospectus forming a part of the Registration Statement under the caption Legal Matters. In giving this consent, we do not admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act and the rules and regulations thereunder.
/s/ Vinson & Elkins L.L.P.
Vinson & Elkins L.L.P.