Our Board of Directors is soliciting your proxy to vote your shares at our 2014 annual meeting of shareholders. In connection with this solicitation, we are providing you with a Notice of Internet Availability of Proxy Materials and access to these proxy materials, which include this 2014 proxy statement, the proxy card for the meeting and our 2013 annual report. For general information regarding the annual meeting,

including information related to Internet access to materials, voting and attending the annual meeting, see “Meeting Information” on page 65. Unless the context otherwise requires, the terms “we”, “our”, “us”, the “Company” or “Chesapeake” as used in this proxy statement refer to Chesapeake Energy Corporation.

The Company’s Board of Directors has adopted Corporate Governance Principles, which include information regarding the Board’s role and responsibilities, director qualifications and determination of director independence and other guidelines, and charters for each of the Board committees. The Board has also adopted a Code of Business Conduct applicable to all directors, officers and employees of the Company, including our principal executive officer, principal financial officer and principal accounting officer. These documents, along with the Company’s Certificate of Incorporation and Bylaws, provide the framework for the functioning of the Board. The Corporate Governance Principles, as well

as the Code of Business Conduct and all committee charters, are available on the Company’s website at www.chk.com in the Corporate Governance sub-section of the section entitled “About”. Waivers of provisions of the Code of Business Conduct as to any director or executive officer are typically evaluated by the Nominating, Governance and Social Responsibility Committee or the Board and amendments to the Code of Business Conduct must be approved by the Board. We will post required disclosure about any such waiver or amendment on our website within four business days of such approval.

The Board is elected by the shareholders to oversee their interest in the long-term health and the overall success of the Company’s business and its financial strength. The Board serves as the ultimate decision-making body of the Company, except for those matters reserved to or shared with the shareholders. The Board selects and oversees the members of senior management, who are charged by the Board with conducting the business of the Company.

The Board is led by Archie W. Dunham, its independent, non-executive Chairman, and is comprised of seven other independent members and

the Company’s Chief Executive Officer. The directors are skilled and experienced leaders in business, education, government and public policy. They currently serve or have served as chief executives and members of senior management of Fortune 1000 companies, investment banking firms and private for-profit and nonprofit organizations and are well-equipped to promote the long-term success of the Company and to provide effective oversight of, and advice and counsel to, the CEO and other members of senior management.

The Board has established a boardroom dynamic that results in informed decisions through meaningful and robust discussion, where views are readily challenged based on each director’s diverse background and opinions. The directors are expected to, and do, ask hard questions of management. Each member of the Board is committed to maximizing shareholder value and promoting shareholder interests. The Board’s key areas of focus are on the Company’s strategy and vision, enhancing financial and management oversight, Board accountability and risk management. The Board has demonstrated its focus through the following actions: (i) redevelopment of a corporate strategy focused on financial discipline and profitable and efficient growth from captured resources; (ii) re-submission of proposals to implement leading corporate

governance practices related to Board accountability, including Board declassification, proxy access and removal of supermajority voting provisions (see “Voting Item 2: Proposal to Declassify our Board”, “Voting Item 4: Proposal to Implement Proxy Access” and “Voting Item 5: Proposal to Eliminate Supermajority Voting Requirements”); (iii) development of an executive compensation program that appropriately ties executive pay to Company performance (see “Executive Compensation—Compensation Discussion and Analysis”); (iv) hiring of a Chief Compliance Officer who reports to the Chairman of the Audit Committee; and (v) full Board evaluation of significant Company risks at each regular meeting, including commodity price and environmental, health and safety risks (see “—Board Role in Risk Oversight”).

The Company separated the Chairman and CEO roles in 2012 and the Board appointed Mr. Dunham as its independent, non-executive Chairman. The Chairman presides at all meetings of the Board, as well as executive sessions of non-employee directors and, in consultation with the CEO, non-employee directors and management, establishes the agenda for each Board meeting. The Board has also delegated certain matters to its three committees, each of which is chaired by an independent director. The Board believes that this leadership

structure provides an effective governance framework for the Company at this time.

The chart below details the purpose of each level of hierarchy in the Company’s leadership structure and provides additional detail on composition, meetings and 2013 activities of the Board. More detail with regard to the composition, meetings and 2013 activities of each of the committees can be found below under “—Board Committees”.

In 2013, the Board also formed a Finance Subcommittee of the Audit Committee. The purpose of the Finance Subcommittee is to provide assistance to the Board in overseeing the financing strategy, financial policies and financial condition of the Company. In 2013, the Finance Subcommittee worked closely with management to develop the Company’s 2014 budget, assisted with the enhancement of the Company’s policies and procedures related to its commodity hedging program and evaluated with management certain opportunities to reduce the Company’s leverage and financial complexity. The Finance Subcommittee is chaired by Vincent J. Intrieri and also consists of Louis A. Raspino, R. Brad Martin, Frederic M. Poses and Thomas L. Ryan as voting members and Domenic J. Dell’Osso, the Company’s Chief Financial Officer, as a non-voting member.

Outside of formal Board and committee meetings, management frequently discusses matters with directors on an informal basis. Non-employee directors meet without management at each regularly scheduled Board meeting. Mr. Dunham presides over meetings of the non-employee directors.

Each director attended, either in person or by telephone conference, at least 75% of the Board and committee meetings held while serving as a director or committee member in 2013. The Company expects all serving directors to attend annual meetings of shareholders. All directors serving at the time of the 2013 annual meeting attended the meeting.

The Board, through its Nominating Committee, evaluates the independence of each director in accordance with the NYSE corporate governance standards. The Committee has considered transactions and relationships between the Company (and/or any of its executive officers) and each director or any member of his or her immediate family. Based on this review, the Committee affirmatively determined that all currently serving directors, other than the CEO, are independent.

In assessing director independence, the Committee considered the business the Company conducted in 2011, 2012 and 2013 with the companies below that had affiliations with our directors. The Committee determined that all transactions and relationships it considered during its review were not material transactions or relationships with the Company and did not impair the independence of any of the independent directors.

The Board has primary responsibility for risk oversight. The Board believes it is appropriate for the full Board to determine the Company’s risk profile and risk tolerance for significant risks, such as risks related to commodity price fluctuations and environmental, health and safety matters. This allows the full Board to analyze the Company’s material risks and influence the Company’s business strategies in light of such risks. Certain matters related to risks inherent in their respective areas of oversight are delegated to the various Board committees, with each committee reporting to the Board at each regular Board meeting. The Audit Committee, in addition to overseeing the integrity of our financial statements and compliance with legal and regulatory requirements and risks related thereto, is primarily responsible for overseeing the Company’s enterprise risk management process, which oversight includes meetings with management, internal audit and independent auditors that focus on risks facing the Company, as well as monitoring the employee and vendor hotline for anonymous reporting of questionable activity. The Compensation Committee oversees risks related to our compensation programs and management retention and development. The Nominating Committee oversees risks related to Board composition and the

Company’s leadership structure and corporate governance, reputational and social responsibility risks. A number of other processes at the Board level support our risk management efforts, including Board reviews of our long-term strategic plans, capital budget and certain capital projects, hedging policy and strategy, succession planning, significant acquisitions and divestitures and capital markets transactions, together with oversight of management in carrying out their risk management responsibilities. In 2013, the Board requested that the Finance Subcommittee review Company policies and procedures related to the Company’s commodity hedging program, although the Board retained decision-making authority for any changes to such policies and procedures.

Fostering a culture of risk management is a Company priority. Management evaluates the enterprise risk process across the Company on a regular basis to ensure consistency of risk consideration in making business decisions. Internal risk committees, comprised of senior management and subject matter experts, have been formed and are meeting regularly to review and assess the Company’s risk management processes and discuss significant risk exposures.

The Nominating Committee periodically assesses the skills and experience needed for the Board to properly oversee the business and affairs of the Company. The Committee then compares those skills to the skills of the current directors and potential director candidates. The Committee conducts targeted efforts to identify and recruit individuals who have the qualifications identified through this process. The Committee looks for its current and potential directors collectively to have a diverse mix of skills, qualifications and experience, some of which are described below:

The Nominating Committee seeks a mix of directors with the qualities that will achieve the ultimate goal of a well-rounded, diverse Board that thinks critically yet functions effectively by reaching informed decisions. Pursuant to its charter, the Committee ensures that diverse candidates are included in all director searches, taking into account race, gender, age, culture, thought, leadership and geography. The Committee and the Board believe that a boardroom with a wide array of talents and

perspectives leads to innovation, critical thinking and enhanced discussion. Additionally, the Committee expects each of the Company’s directors to have proven leadership, sound judgment, integrity and a commitment to the success of the Company.

In evaluating director candidates and considering incumbent directors for nomination to the Board, the Nominating Committee considers a variety of factors. These include each nominee’s independence, financial literacy, personal and professional accomplishments and experience in light of the needs of the Company. For incumbent directors, the factors also include past performance on the Board and contributions to their respective committees. Along with each director’s biography, we have included below an assessment of the skills and experience of such director. The Committee has used third-party consultants to assist in identifying potential director nominees. The Committee considers and, in the past, has nominated appropriate candidates recommended by shareholders.

Bob A. Alexander will retire at the 2014 annual meeting. John J. Lipinski was nominated to the Board on March 7, 2014, to fill the resulting vacancy. Potential candidates were solicited from significant shareholders and directors. The Board considered several candidates who were evaluated based on the established criteria for persons to be nominated. The Board believes Mr. Lipinski meets the established criteria and is well qualified for election to the Board. Mr. Lipinski is a new nominee for election to the Board this year. His nomination was recommended by the Nominating Committee and approved by the Board.

Pursuant to provisions of the Company’s Certificate of Incorporation and Bylaws, the Board has fixed the maximum number of directors at nine, subject to the rights of the holders of our preferred stock to nominate and elect two additional directors in circumstances that are not anticipated to apply. Our Certificate of Incorporation and Bylaws currently provide for three classes of directors serving staggered three-year terms, each to hold office until a successor is elected and qualified or until the director’s earlier resignation or removal. Our Board is recommending that shareholders approve the declassification of our Board. See “Voting Item 2: Proposal to Declassify our Board”. The outcome of that vote will determine whether we declassify the Board and provide for annual elections of directors beginning with the 2015 annual meeting or continue to have a classified Board.

The terms of Vincent J. Intrieri, Robert D. Lawler and Frederic M. Poses, each a member of Class II, expire at the meeting. In addition, due to the Company’s mandatory retirement policy, Bob A. Alexander’s term will end at the 2014 annual meeting, and the Board is proposing the election of John J. Lipinski to fill the vacancy created by Mr. Alexander’s retirement. The Board has nominated each of Messrs. Intrieri, Lawler, Lipinski and Poses to serve for a one-year term if shareholders approve declassification of the Board or, alternatively, for a three-year term expiring in 2017 with respect to Messrs. Intrieri, Lawler and Poses and for a two-year term expiring in 2016 with respect to Mr. Lipinski if shareholders do not approve declassification of the Board.

The directors currently serving in Class III and Class I have indicated their support for the elimination of the Company’s classified board structure and have agreed to allow shareholders to vote on their continued service on the Board. The Class III directors consist of Archie W. Dunham, R.

Brad Martin and Louis A. Raspino, whose terms expire in 2015. Any director serving in Class III who receives a majority of votes cast in favor of his continued service on the Board will continue to serve as a director for the remainder of his term, or one year. The Class I directors consist of Merrill A. Miller, Jr. and Thomas L. Ryan, whose terms expire in 2016. If declassification is approved by shareholders, any director serving in Class I who receives a majority of votes cast in favor of his continued service on the Board will serve for an additional year and his term will expire at the 2015 annual meeting, in accordance with the proposed amendment to our Certificate of Incorporation. If declassification is not approved by shareholders, any director serving in Class I who receives a majority of votes cast in favor of his continued service on the Board will serve the remainder of his term, or until 2016.

Whether or not declassification of our Board is approved by shareholders, the Company’s Bylaws provide that any incumbent director, which includes all nominees, who does not receive a majority of votes cast in favor of his election, or a Majority Against Vote, will, following the certification of the shareholder vote by the inspector of elections, promptly comply with the resignation procedures established under the Company’s Corporate Governance Principles. The Class III and Class I directors have agreed that they will comply with these procedures if their continued service on the Board is not approved by a majority of the votes cast with respect to such director.

It is the intention of the persons named in the enclosed form of proxy to vote such proxies for the election of the nominees. The Board expects that all of the nominees will be available for election but, if any of the nominees is not available, proxies received will be voted for substitute nominees to be designated by the Board or, if no such designation is made, proxies will be voted for a lesser number of nominees.

We are asking shareholders to approve an amendment to our Certificate of Incorporation to effect the declassification of our Board of Directors. Currently, our Certificate provides that our Board is divided into three classes, with members of each class holding office for staggered three-year terms. One class of directors, representing approximately one-third of our directors, stands for election at each annual meeting of shareholders.

Following our 2012 annual meeting, our Board performed a comprehensive review of the Company’s corporate governance practices, led by our

Nominating Committee, which included the solicitation of shareholder input in this area. Our Board considered the issue of board declassification in connection with the review and proposed declassification of the Board at the 2013 annual meeting of shareholders. Although the proposal did not receive the requisite shareholder approval at the 2013 annual meeting of shareholders, the Board believes that the significant support it did receive warrants proposing Board declassification at the 2014 annual meeting. As such, at its meeting on April 14, 2014, the Board approved an amendment to the Certificate to declassify the Board, subject to shareholder approval.

We are asking shareholders to approve an amendment to our Certificate that would eliminate the three-year classified terms of our directors and provide instead for the annual election of all directors elected at our 2015 annual meeting for one-year terms expiring at the next succeeding annual meeting, subject to a director’s earlier death, resignation, retirement, disqualification or removal from office. Further, in connection with the proposed declassification of the Board, we are also proposing to amend our Certificate so that a director elected or appointed by the Board to fill any vacancy on our Board will hold office for a term expiring at the annual meeting of shareholders following such appointment. If the proposed amendment to the Certificate is approved as set forth in this

Voting Item, all directors would be elected by shareholder vote at the 2015 annual meeting and would be elected for one-year terms to expire at the annual shareholders meeting in 2016. In addition, following the effectiveness of the amendment to the Certificate, any directors elected or appointed to fill any vacancies on the Board would be appointed for terms expiring at the annual meeting of shareholders following such appointment. The proposed amendment will thus have the effect of shortening the existing terms of certain directors whose terms extend beyond the 2015 annual meeting. See “Voting Item 1: Election of Directors” for a description of the terms of each class of our directors.

In connection with the amendment to our Certificate to declassify the Board, our Board has approved a conforming amendment to our Amended and Restated Bylaws which will become effective immediately following the effectiveness of the counterpart amendment to our Certificate without further action by the shareholders; provided, however, that the amendment to the Bylaws is conditioned upon shareholder approval of the proposed amendment to the Certificate. In addition to the conforming changes made in accordance with the amendment to the Certificate described above, our Board has approved changes to the Bylaws to provide that, from and after the effectiveness

of the declassification of the Board, a majority of shareholders may remove any director or the entire Board of Directors with or without cause. Under Oklahoma law, shareholders may remove directors of corporations with classified boards only for cause, while directors of corporations without classified boards may be removed with or without cause. Accordingly, the Board believes that it is appropriate to amend the Bylaws to confirm that, in accordance with Oklahoma law, from and after the effectiveness of the declassification, shareholders may remove a director with or without cause.

If the proposed amendment to our Certificate to declassify the Board is approved, it will become effective upon the filing of such amendment with the Oklahoma Secretary of State, and the conforming changes to the Bylaws will become effective immediately following the effectiveness of the amendment to the Certificate. If the proposed amendment is not approved, the Board will continue to be divided into three classes of

directors elected for three-year terms, and the shareholders will continue to be able to remove directors only for cause pursuant to the Bylaws. The affirmative vote of the holders of at least sixty-six and two-thirds percent (66 2/3%) of the issued and outstanding common stock of the Company is required to approve the amendment to our Certificate to declassify the Board.

We are asking shareholders to approve an amendment to our Certificate of Incorporation to increase the maximum number of directors that may constitute our Board. The Board believes an increase in its size will provide the opportunity, consistent with our Corporate Governance Principles and the considerations mandated by the Nominating Committee’s charter, to continue to build a board with diverse talents and perspectives, as well as demonstrated experience and expertise. The Board believes an increase in its size will serve to enhance the culture of

innovation, critical thinking and thoughtful discussion in the boardroom. An increase in the Board’s size will also provide an additional resource to allow for appropriate staffing of the Board’s committees and provide flexibility to add more committees if the Board determines such an addition would enhance its governance structure. The Board, at its meeting on April 14, 2014, approved an amendment to the Certificate to increase the maximum size of the Board to ten, subject to shareholder approval.

If the proposed amendment to our Certificate to increase the maximum size of the Board is approved, it will become effective upon the filing of such amendment with the Oklahoma Secretary of State, and the conforming changes to the Bylaws will become effective immediately following the effectiveness of the amendment to the Certificate. If the proposed amendment is not approved, the number of directors that may

constitute the Board will remain at not less than three or more than nine. The affirmative vote of the holders of at least sixty-six and two-thirds percent (66 2/3%) of the issued and outstanding common stock of the Company is required to approve the amendment to our Certificate to increase the number of directors that may constitute the Board.

We are asking shareholders to approve an amendment to our Bylaws to permit shareholder-nominated director candidates in our proxy materials. At our 2012 annual meeting, a similar shareholder-submitted proposal received the support of a majority of shareholders who cast votes at the meeting. Because it relates to the fundamental right of shareholders to elect directors, the Board submitted a proposal to implement proxy access at the 2013 annual meeting of shareholders.

Although the proposal to implement proxy access did not receive the requisite shareholder approval at the 2013 annual meeting of shareholders, the Board believes that the significant support it did receive warrants proposing proxy access at the 2014 annual meeting. As such, at its meeting on April 14, 2014, the Board determined to submit this proposal to amend the Bylaws to implement proxy access.     

The maximum number of shareholder-nominated candidates would be equal to 25% of the number of directors serving on the Board at the time the notice is required to be submitted to the Company. If the 25% calculation does not result in a whole number, the maximum number of shareholder-nominated candidates would be the closest whole number below 25%. Based on our current Board size of nine directors, the maximum number of shareholder-nominated candidates that we would be required to include in our proxy materials for an annual meeting is two. The number of permitted candidates would include nominees submitted

under the proxy access procedures that are either later withdrawn or that the Board subsequently determines to include in that year’s proxy materials as Board-nominated candidates. If the number of shareholder-nominated candidates exceeds 25%, each nominating shareholder would select one nominee for inclusion in the Company’s proxy materials until the maximum number is reached. The order of selection would be determined by the amount of shares of Company common stock (largest to smallest) held by each nominating shareholder or group of shareholders.

Each shareholder seeking to include a director nominee in the Company’s proxy materials would be required to provide certain information and make certain representations and undertakings at the time of nomination, including:

In addition, each shareholder nominee would be required to submit completed and signed questionnaires required of the Company’s directors and officers and provide such additional information as necessary to permit the Board to determine if the shareholder nominee is independent under the listing standards of the principal U.S. exchange upon which the common stock of the Company is listed, any applicable rules of the SEC, or any publicly disclosed standards used by the Board in determining and disclosing the independence of the Company’s directors.

We are asking shareholders to approve an amendment to our Certificate of Incorporation to eliminate supermajority voting requirements. At our 2012 annual meeting, a shareholder-submitted proposal urging the Company to take all steps necessary to remove the supermajority vote requirement received the support of a majority of shareholders who cast votes at our meeting. Our Board considered this proposal and proposed the elimination of supermajority voting requirements at the 2013 annual meeting of

shareholders. Although the proposal did not receive the requisite shareholder approval at the 2013 annual meeting of shareholders, the Board believes that the significant support it did receive warrants proposing the elimination of supermajority voting requirements at the 2014 annual meeting. As such, at its meeting on April 14, 2014, the Board approved an amendment to the Certificate to eliminate supermajority voting and implement a majority voting standard, subject to shareholder approval.

The Certificate currently requires the affirmative vote of sixty-six and two-thirds percent (66 2/3%) of the outstanding stock entitled to vote for shareholders to approve the following actions:

The proposed amendment would reduce the voting requirements for these actions to require a vote of a majority of the outstanding shares entitled to vote in each circumstance described above. The Oklahoma General Corporation Act requires that certain business combinations between the Company and Interested Shareholders receive the affirmative vote of no less than 66 2/3% of the votes cast by holders, excluding the votes of the Interested Shareholders. Therefore, this provision of our Certificate will not be impacted by this Voting Item.

In connection with the amendment to our Certificate to eliminate supermajority voting requirements, our Board has approved a conforming amendment to our Bylaws which will become effective immediately following the effectiveness of the counterpart amendment to our Certificate without further action by the shareholders; provided, however, that the amendment to the Bylaws is conditioned upon shareholder approval of the proposed amendment to the Certificate. The Bylaws

currently require the affirmative vote of sixty-six and two-thirds percent (66 2/3%) of the outstanding common stock entitled to vote for shareholders to approve a change in the number of directors that constitute the Board. If the Certificate amendment described in this Voting Item is approved, the Bylaws will be amended to reflect the majority voting standard.

If the proposed amendment to our Certificate to eliminate supermajority voting requirements is approved, it will become effective upon the filing of such amendment with the Oklahoma Secretary of State, and the conforming amendment to the Bylaws will become effective immediately following the effectiveness of the amendment to the Certificate. If the proposed

amendment is not approved, the supermajority provisions described herein will remain in effect. The affirmative vote of the holders of at least sixty-six and two-thirds percent (66 2/3%) of the issued and outstanding common stock of the Company is required to approve the amendment to our Certificate to remove the supermajority provisions described herein.

Our non-employee director compensation program consists of an annual cash retainer, a value-based equity grant for all non-employee directors and additional value-based equity grants for the Chairman of the Board and the Chairman of each Board committee. Details of our non-employee director compensation program are as follows:

The Company began issuing restricted stock units in lieu of restricted stock in June 2013. Restricted stock unit grants to non-employee directors vest 25% immediately upon award and 75% ratably over the three years following the date of award. Grants of restricted stock units have been made pursuant to our Amended and Restated Long Term Incentive Plan, or 2005 LTIP, and we expect future grants will be made pursuant to our 2014 Long Term Incentive Plan if approved by shareholders (see page 56, “Voting Item 7: Proposal to Adopt 2014 Long Term Incentive Plan”). In 2013, quarterly equity awards were made on the dates of the regularly scheduled meetings of the Board on March 7, June 13, September 19 and December 13, 2013. For 2014, quarterly

equity awards will be made along with retainer payments on the first day of each quarter to facilitate administration of director compensation. Directors are also reimbursed for travel and other expenses directly related to their service as directors.

Each new non-employee director receives an initial stock award upon appointment to the Board of up to 10,000 unrestricted shares pursuant to our 2003 Stock Award Plan for Non-Employee Directors. These awards have provided the Company with a valuable tool to ensure that the Board can recruit talented directors to serve on the Board and ensure that such directors’ interests are immediately aligned with shareholders. In 2013, our two new non-employee directors, Louis A. Raspino and Thomas L. Ryan, received 10,000 shares each under the 2003 Stock Award Plan.

In April 2013, the Compensation Committee approved a special grant of restricted stock to Mr. Dunham with a value of $250,000 in recognition of the significant time he devoted to the Company, including as a member of the Office of the Chairman. The grant vests 25% immediately and 75% ratably over the three years following the date of award.

Directors are eligible to defer any or all of their annual cash retainers through a deferred compensation plan of the Company on a tax-deferred basis. Messrs. Intrieri and Ryan have elected to defer their annual cash retainers into Company stock through the Chesapeake Deferred Compensation Plan for Non-Employee Directors. Deferrals into the plan are not matched or subsidized by the Company, nor are they eligible for above-market or preferential earnings. The Company has established a stock ownership guideline for non-employee directors to hold at least 15,000 shares of the Company’s common stock at all times while serving as a director. Newly appointed directors are generally given three years from the date of appointment to comply with this guideline. Failure to comply with this guideline or potential deferrals of the guideline due to hardship are addressed on a case-by-case basis by the Board. There were no failures or deferrals in 2013.

The Company has adopted a written related party transaction policy with respect to any transaction, arrangement or relationship or series of similar transactions, arrangements or relationships (including any indebtedness or guarantee of indebtedness) in which (1) the aggregate amount involved will or may be expected to exceed $120,000, (2) the Company is a participant and (3) any of its currently serving directors and executive officers, or those serving as such at any time since the beginning of the last fiscal year, or greater than 5% shareholders, or any of the immediate family members of the foregoing persons, has or will have a direct or indirect material interest. The Audit Committee reviews and approves all interested transactions, as defined above, subject to certain enumerated exceptions that the Audit Committee has

determined do not present a “direct or indirect material interest” on behalf of the related party, consistent with the rules and regulations of the SEC. Such transactions are subject to the Company’s existing Code of Business Conduct. Certain transactions with former executive officers and directors that fall within the enumerated exceptions will be reviewed by the Audit Committee. The Audit Committee approves or ratifies only those transactions that it determines in good faith are in, or are not inconsistent with, the best interests of the Company and its shareholders. All transactions described below that do not fall within the enumerated exceptions described in the policy have been reviewed or approved by the Audit Committee.

David C. Lawler, who is the Executive Vice President and Chief Operating Officer of SandRidge Energy, Inc., is the brother of Robert D. Lawler, the Company’s CEO. The Company engages in transactions with SandRidge

in the ordinary course of business and no such transaction has been determined to be a related party transaction under the Company’s related party transaction policy.

Isaac Jacobson, son of Douglas J. Jacobson, Executive Vice President–Acquisitions and Divestitures, was an employee of the Company in 2013. Mr. Jacobson’s total cash and equity compensation for 2013 was $154,679. Andrew Kapchinske, son of John M. Kapchinske, Senior Vice President–Exploration and Subsurface Technology, has been an employee of the Company since September 2007. Mr. Kapchinske’s total cash and equity compensation for 2013 was $188,284. The Company is a

significant employer in Oklahoma City. We seek to fill positions with qualified employees, whether or not they are related to our executive officers or directors. We compensate employees who have such relationships within what we believe to be the current market rate for their position and provide benefits consistent with our policies that apply to similarly situated employees. Compensation arrangements for family members of related parties are approved by the Compensation Committee.

In 2011, Chesapeake entered into a license and naming rights agreement with The Professional Basketball Club, LLC, or the PBC, for an

arena in downtown Oklahoma City. PBC is the owner of the Oklahoma City Thunder, or the Thunder, basketball team, a National Basketball

Association, or NBA, franchise and the arena’s primary tenant. Aubrey K. McClendon, the Company’s former CEO, has a 19.2% equity interest in PBC. Under the terms of the agreement, Chesapeake has committed to pay annual fees ranging from approximately $2.9 million, the amount paid for the 2011-2012 season, escalating ratably to approximately $4.2 million payable in 2023 for the arena naming rights and other associated benefits. The arena naming rights provide Chesapeake with enhanced public awareness through recognition locally, nationally and internationally. For the 2012-2013 and 2013-2014 seasons, Chesapeake paid fees of approximately $2.6 million and $3.2 million, respectively. The fee for the 2012-2013 season reflected a reduction of $480,000 as a result of the NBA lockout at the beginning of the 2011 season. Mr. McClendon made annual charitable contributions for the benefit of Oklahoma schools equal to his percentage ownership of the Thunder (19.2%) times the fees paid by the Company under the naming rights agreement for the first two seasons covered by the agreement.

In 2011, the Company also entered into a 12-year sponsorship agreement, committing to pay an average annual fee of approximately

$3.0 million for advertising, use of an arena suite and other benefits. For the 2012-2013 and 2013-2014 seasons, the Company paid fees of approximately $2.4 million and $2.5 million, respectively, pursuant to the sponsorship agreement. Chesapeake has been a founding sponsor of the Thunder since 2008.

For the 2012-2013 season, the Company reduced its regular season commitment for additional game tickets to a net amount of approximately $1.6 million, which gives effect to a refund of $1.2 million from PBC and $678,000 received by the Company for the sale of approximately 15% of its tickets to Company management, including the sale of season tickets to Mr. McClendon for approximately $140,000, and to Access Midstream Partners, L.P., in each case at the same price the Company paid to the PBC. The Company also paid approximately $328,000 for sponsorship, advertising and tickets for 2013 home playoff games. For the 2013-2014 season, the Company paid approximately $994,000 for additional tickets for regular season games and has committed to purchase a limited number of tickets and certain sponsorship benefits for any 2014 home playoff games, the total amount for which will depend on the number of home playoff games played by the Thunder.

The Founder Well Participation Program, or FWPP, permits Mr. McClendon, the Company’s co-founder, to participate and invest as a working interest owner in new program wells drilled by the Company. In 2005, the FWPP was documented as a formal plan containing substantially the same terms as prior agreements with the Company’s two co-founders that had been in place since the Company’s initial public offering in 1993. Shareholders approved the FWPP on June 10, 2005 for a term ending on December 31, 2015. The participation of co-founder Tom L. Ward terminated following his separation from the Company in 2006. In April 2012, the Board and Mr. McClendon agreed to the early termination of the FWPP on June 30, 2014, 18 months before the end of its original expiration date. Mr. McClendon’s right to participate in new program wells drilled by the Company under the FWPP continues through the expiration of the FWPP on June 30, 2014 despite his separation from the Company on April 1, 2013. See “—Separation Arrangements” below for additional information on the terms of his separation.

The Compensation Committee of the Board of Directors administers and interprets the FWPP. Under the FWPP, Mr. McClendon has had the right to participate in either all or none of the wells spudded by or on behalf of the Company during each calendar year. Mr. McClendon has elected to participate in the FWPP through the expiration of the FWPP on June 30, 2014 at the maximum 2.5% working interest permitted, the same participation percentage he has elected every year since 2004. Mr. McClendon has participated in the FWPP through entities in which all equity interests are owned solely by Mr. McClendon and his immediate family members, as permitted by the terms of the FWPP subject to approval by the Compensation Committee. Prior to his separation, Mr. McClendon was required to pay all joint interest billings immediately on receipt of the Company’s invoice and to advance to the Company any

amounts which the Company is required to prepay to third-party operators with respect to Mr. McClendon’s working interest to be assigned under the FWPP. Following his separation, Mr. McClendon pays joint interest billings from the Company in accordance with terms afforded to the Company’s significant joint venture partners and as set forth in applicable joint operating agreements.

The FWPP provides that the amount paid by Mr. McClendon for acreage assigned in connection with his participation in the FWPP is to be recomputed as of the first day of each calendar year and is equal to a fully-costed average per acre amount computed as follows: (i) direct costs capitalized in the appropriate accounting pool in accordance with the Company’s accounting procedures (including all capitalized interest, leasehold payments, acquisition costs, landman charges and seismic charges) divided by (ii) the acreage in the applicable pool at the time of computation. The annual computation has allowed the Company to give effect to the acreage and costs of newly acquired acreage, acreage sold by the Company and acreage that has expired. All other costs are billed in accordance with the Company’s accounting procedures applicable to third-party participants pursuant to any joint operating agreement or exploration agreement relating to a particular well, and such amounts paid by Mr. McClendon in connection with his participation in a well are on no better terms than the terms agreed to by unaffiliated third-party participants in connection with the participation in such well or similar wells operated by the Company.

The following table sets forth the revenue received from, and well costs paid to, the Company with respect to Mr. McClendon’s FWPP interests during the first quarter of 2014 and each of the three years in the period ended December 31, 2013:

The foregoing information has been derived solely from the Company’s records. Accordingly, it excludes revenues and expenses for some FWPP interests that are not operated by the Company, and it may include revenue and expenses for producing FWPP interests conveyed to others. For example, the foregoing amounts include revenue attributable to volumetric production payments (VPPs) owed to third parties under transactions that Mr. McClendon has entered into from time to time. Mr. McClendon pays the related lease operating expenses and disburses revenue to the VPP owners.

Mr. McClendon has advised us that the present value of the future net revenue (pretax) of the estimated proved developed producing reserves attributable to his FWPP interests at December 31, 2013, discounted at 10% per year and based on prices and costs under existing conditions at such date as prescribed by the SEC’s reserves reporting rules, was approximately $583 million. As indicated in the Company’s 2013 Form 10-K filed on February 27, 2014 and other filings that include estimates of the Company’s proved natural gas and oil reserves, any computation of proved producing reserves is an estimate, subject to a number of variables and not a reflection of fair market value. A portion of the leasehold owned by Mr. McClendon with respect to the FWPP consists of interests that are not categorized as proved developed producing reserves. The Company’s reservoir engineering staff provides data and analysis to Mr. McClendon’s affiliates with respect to reserves associated with FWPP interests using the engineering prepared for the Company’s

interest in the same wells. In 2013, Mr. McClendon reimbursed the Company approximately $580,000 to cover the estimated cost of such services.

Mr. McClendon’s FWPP interests are his personal assets and are separate and distinct from the Company’s interest in its oil and gas properties and other assets. The FWPP does not restrict sales, other dispositions or financing transactions involving FWPP interests acquired from the Company. The Company has not extended loans to Mr. McClendon for participation in the FWPP or any other purposes, the Company has no obligation to repay loans Mr. McClendon may obtain from third parties, and no Company interests in any assets are exposed to such loans or the mortgages securing them. From time to time, Mr. McClendon through affiliates has sold FWPP interests separately and concurrently with sales by the Company of its interests in the same properties. In any concurrent sales, the proceeds related to the properties have been allocated between Mr. McClendon’s affiliates and the Company based on their respective ownership interests. From January 1, 2013 through March 31, 2014, Mr. McClendon’s affiliates realized approximately $4.7 million from such concurrent sales, and they paid $8,151 of deal costs. As described below, the terms of Mr. McClendon’s separation provide the Company a “drag” right and Mr. McClendon a “tag” right with respect to FWPP interests in connection with sales by the Company of its joint interests in an area or play.

On April 1, 2013, Mr. McClendon ceased serving as President and CEO of the Company and resigned as a director of its Board. On April 18, 2013, the Company and Mr. McClendon entered into a Founder Separation and Services Agreement, which was effective as of January 29, 2013. See “Executive Compensation—Post-Employment Compensation—Named Executive Officer Separations—Aubrey K. McClendon” on page 50 for a discussion of the Founder Separation and Services Agreement.

Pursuant to the Founder Separation and Services Agreement, on April 18, 2013, the Company, Mr. McClendon and certain affiliates of Mr. McClendon, or the Founder Affiliates, entered into a Founder Joint Operating Services Agreement, or FJOSA, effective as of January 29, 2013, relating to the jointly developed oil and gas wells, increased density locations, leases and acreage jointly owned by the Company and the respective Founder Affiliates, or the Joint Interests. The FJOSA is intended to enable the parties to maintain and continue their previously developed methods and practices for access to and sharing of information essential for the efficient administration of their respective interests in the Joint Interests and to provide a framework for the continued efficient administration thereof. The Company developed certain search software to allow Mr. McClendon and the Founder Affiliates to access Joint Interest data for which Mr. McClendon paid the Company $75,000 for its cost. The Company will continue to provide reserve reports on Joint Interests through no later than December 31, 2016, and the Founder Affiliates are required to reimburse the Company for the costs of such services. Through June 30, 2014, the Company will provide Mr. McClendon and the Founder Affiliates data, licenses and services related to Joint Interests, as well as certain transition services. The Company will provide land services through December 31, 2016 or so long as is required under applicable joint operating or other agreements. In addition, the Company has agreed to continue to provide certain routine monthly services. Routine services relating to the preparation of schedules and exhibits to mortgages will be billed to the applicable

Founder Affiliates at a monthly rate of $50,000 as part of the monthly joint interest billings beginning July 1, 2014, subject to termination or reduction in services as well as an annual adjustment. The Company recoups its costs of providing other routine services set forth in the FJOSA through standard overhead billings pursuant to the terms of any applicable joint operating agreements with the Founder Affiliates. The Company provides a monthly credit of $50,000 in the aggregate to reduce the marketing fees billed by the Company or its affiliates under the existing marketing fee arrangements between the Founder Affiliates and the Company or its affiliates beginning April 1, 2013, provided that the credit may not reduce the marketing fees below zero in any month. The FJOSA provides that overhead rates charged by the Company to a Founder Affiliate for Joint Interests will be the applicable rate paid by the Company’s significant joint venture partners, except that in the Barnett Shale play and in other areas where there is no such joint venture agreement, the Company’s standard overhead rate applies and will be on no better terms than those agreed to by unaffiliated third-party participants. The FJOSA also provides that if the Company agrees to sell all or a portion of the Company’s Joint Interests in an area or play, the Company or the applicable Founder Affiliate may elect to include the applicable Founder Affiliates’ Joint Interests in the sale transaction (in the same proportion as those being sold by the Company in the sale transaction), with the applicable Founder Affiliates to receive their respective portion of the sale proceeds from any such sale transaction. A portion of any third-party legal, accounting, advisory or other professional fees incurred by the Company in connection with a transaction is to be deducted from sale proceeds paid to a Founder Affiliate based on its proportionate share.

Copies of the Founder Separation and Services Agreement and FJOSA are filed as Exhibits 10.1 and 10.2, respectively, to the Company’s Current Report on Form 8-K filed on April 19, 2013.

On July 26, 2013, the Company and Mr. McClendon rescinded the December 2008 sale of an antique map collection pursuant to the terms of a settlement agreement terminating pending shareholder litigation that was approved by the District Court of Oklahoma County, Oklahoma on

January 30, 2012 and affirmed on appeal. The Company returned the subject maps to Mr. McClendon, and Mr. McClendon paid the Company $12.1 million plus interest.

Effective September 23, 2013, in an effort to reduce costs, the Company transferred its rights to a suite at AT&T Stadium (formerly, Dallas Cowboys Stadium) in Arlington, Texas to an affiliate of Mr. McClendon. Pursuant to the agreement, Mr. McClendon’s affiliate reimbursed the 2013 annual lease fee of $500,000, prorated for the number of football

games remaining in the season at the time of the transaction, and assumed the Company’s remaining annual lease obligations of $7.5 million. The Company has no further obligations under the suite lease agreement.

In October 2013 following a request for proposal process, a subsidiary of the Company and American Energy–Utica, LLC, or AEU, entered into agreements whereby the Company would provide land drilling services to AEU in the Utica Shale. Mr. McClendon is an investor in AEU and AEU is managed by a subsidiary of American Energy Partners, LP, which is an affiliate of Mr. McClendon. On October 16, 2013, the Company and AEU

entered into a drilling contract for a term of six months with an operating dayrate of $23,500. On October 31, 2013, the Company and AEU entered into separate drilling contracts in respect of six other drilling rigs for terms of two years with operating dayrates of $26,000 each. The transactions were negotiated on an arms-length basis based on prevailing market rates for similar services in the area.

The table below sets forth (i) the name and address and beneficial ownership of each person known by management to own beneficially more than 5% of our outstanding common stock, and (ii) the beneficial ownership of common stock of our nominees, directors and named

executive officers and all directors and executive officers of the Company as a group. Unless otherwise noted, information is given as of April 14, 2014, the record date, and the persons named below have sole voting and/or investment power with respect to such shares.

2013 was a transitional and transformational year at Chesapeake. In January 2013, the Company announced that Mr. McClendon would step down as President, CEO and a director of the Company effective April 1, 2013. The announcement and the transition period that followed the announcement presented complex executive compensation decisions for the Board and Compensation Committee. These decisions generally fell

into two categories: (i) decisions related to Mr. McClendon’s separation and (ii) decisions designed to attract and retain the right personnel to drive future performance. The Board and Committee’s navigation of these decisions ensured a smooth CEO transition, preservation of shareholder value through successful execution of the Company’s strategic plan and the attraction and retention of high-performing executives.

Decisions Related to Mr. McClendon’s Separation

The following summarizes the timing and context of decisions related to Mr. McClendon’s separation from the Company:

Decisions Designed to Attract and Retain the Right Personnel to Drive Future Performance

The following summarizes the timing and context of decisions related to compensation of our named executive officers which were intended to align with best practices and promote shareholder value:

Response to 2013 Shareholder Advisory Vote on Named Executive Officer Compensation

At our 2013 annual meeting, approximately 84% of shares cast voted in favor of our named executive officer compensation. This was a marked difference from 2012 when we received only 20% support, which led the Compensation Committee to engage in a comprehensive review of the Company’s executive compensation program with the assistance of F.W. Cook. The goal of this review was to ensure that the Company’s compensation programs appropriately tie executive pay to Company performance. The 2013 vote told us that most shareholders agree that the Company’s redesigned executive compensation program better aligns with shareholder objectives and is responsive to shareholder concerns voiced over the past two years. This was also confirmed through discussions that took place before and after the 2013 annual meeting with shareholders representing nearly half of the Company’s outstanding shares.

The Compensation Committee continues to evaluate the executive compensation program in order to execute the Company’s compensation philosophy (see “—Executive Compensation Program—Philosophy and Objectives of our Executive Compensation Program” below). In 2013, the Compensation Committee made the decisions outlined above under “2013 Executive Compensation Story—Decisions Designed to Attract and Retain the Right Personnel to Drive Future Performance” with regard to the ongoing executive compensation program.

The Compensation Committee has continued to refine the Company’s executive compensation program through the implementation of the following changes for 2014:

At the 2014 annual meeting, we will again hold an advisory vote on named executive officer compensation (see “Voting Item 6: Shareholder Advisory Vote to Approve Named Executive Officer Compensation” on page 55), in accordance with the shareholders’ advisory vote in 2011 in favor of annual advisory votes on executive compensation. The Compensation Committee will consider the results from this year’s and future advisory votes on executive compensation.

To guide compensation decisions, the Compensation Committee adopted a formal compensation philosophy in 2012. The philosophy reflects the Compensation Committee’s intent to generally set all elements of target compensation (e.g., base salary, target annual incentive award opportunity and target long-term incentive award opportunity) at the median of similarly situated executives among the Company’s peer group or other relevant industry benchmarks. The competitive positioning of target compensation levels for individuals may vary above or below the median based on executive-specific factors such as tenure, experience, proficiency in role or criticality to the organization. The Compensation Committee’s objective is to have a program that:

Unlike target compensation levels, which are set by the Compensation Committee near the beginning of the year, actual compensation is a function of the Company’s operational, financial and stock price performance, as reflected through annual incentive payouts, performance share payouts and the value of all other long-term incentive awards at vesting. Actual compensation is intended to vary above or below target levels commensurate with Company performance.

The Committee has overall responsibility for approving and evaluating the director and executive officer compensation plans, policies and programs of the Company. In determining compensation, the Compensation Committee makes an overall assessment of the performance of the named executive officer team and the role and relative contribution of each of its members on an annual basis. In 2013, the Compensation Committee’s approach consisted of both subjective consideration of each

named executive officer’s performance and overall role in the organization and objective consideration of the Company’s performance relative to predetermined metrics as more fully described beginning on page 26 under “—2013 Named Executive Officer Compensation Elements”. In its assessment of the performance of each named executive officer in 2013, the Compensation Committee considered the following:

Pursuant to its charter, the Compensation Committee may retain a compensation consultant, and shall be directly responsible for the appointment, compensation and oversight of the work of any compensation consultant that it retains. The Compensation Committee has retained F.W. Cook as its independent compensation consultant to provide an objective analysis of, and counsel on, the Company’s executive compensation program. In addition, Pay Governance LLC provided consulting services to management in 2013 related to the Company’s executive compensation programs, policies and processes.

In 2013, F.W. Cook attended all Compensation Committee meetings. F.W. Cook provided the Committee with market analyses and advised the Committee on market trends and regulatory and governance developments and how they may impact our executive compensation programs. They also advised the Committee with regard to the design and structure of our executive compensation programs to ensure appropriate linkage between pay and performance, setting the pay for our CEO, and compensation for other executive officers in consultation with the CEO. From time to time Pay Governance may provide information and recommendations to the Committee with respect to executive compensation. F.W. Cook typically

participates in these meetings and performs an independent, objective analysis of market and other data provided by Pay Governance and generally counsels the Committee as to the advice obtained from Pay Governance.

The Compensation Committee evaluated whether conflicts of interest were created by the retention of any of the advisors providing compensation consulting services in 2013 and evaluated their independence pursuant to the standards set forth in the New York Stock Exchange Listed Company Manual. As a result of this assessment, the Compensation Committee concluded that (i) no conflicts of interest exist with respect to F.W. Cook or Pay Governance; and (ii) Pay Governance is not independent from management given the reporting relationship with management, the responsibility of management for the oversight of Pay Governance’s work product and the services provided. The Compensation Committee concluded that any potential conflict posed by the Compensation Committee’s receipt of information and advice from Pay Governance was sufficiently mitigated by the direct involvement of its independent compensation consultant, F.W. Cook, and the Compensation Committee’s own examination and assessment of the objectivity of Pay Governance’s advice.

The Compensation Committee uses benchmarking to compare the competitiveness of the named executive officers’ total direct compensation, consisting of base salary, annual incentive compensation and the value of long-term incentive awards, relative to our compensation peer group companies. For 2013, our compensation peer group consisted of eleven exploration and production peer companies (expanded from 5 companies in 2012) which are similar to the Company in size, scope and nature of business operations, and with whom we compete for talent, including:

Our compensation peer group contains companies in our industry that are both larger and smaller in size and scope. With the exception of Hess and Murphy Oil, all of the peer companies are independent exploration and production companies. We considered companies that compete in our industry, but are significantly larger than we are, and companies that compete in unrelated industries within the energy sector such as the mining or coal industries but did not include such companies in our compensation peer group. We compete with the companies in our compensation peer group for talent, and the Compensation Committee believes the selected companies were the most appropriate for use in benchmarking 2013 executive compensation. The differences and similarities between us and the companies in our industry peer group are taken into consideration when referencing benchmarks for named executive officer compensation decisions.

The benchmarking analysis indicated that target total direct compensation for our former CEO was between the median and seventy-fifth percentile and each of the other named executive officers was above the seventy-

fifth percentile of benchmark data as compared to our peers. These results informed the Compensation Committee’s decisions with respect to setting 2013 executive compensation, including establishing the targets for the 2013 annual incentive plan award and PSU component of the Company’s long-term incentive program for named executive officers. As discussed above under “—Executive Compensation Program—Philosophy and Objectives of Our Executive Compensation Program”, the Compensation Committee intends to generally set all elements of target compensation at the median of similarly situated executives among the Company’s compensation peer group and may also consider other

relevant industry benchmarks in making compensation decisions. The results of the benchmarking suggested higher competitive positioning of target long-term incentive grants. This data point became one factor in the Compensation Committee’s determination to reduce the long-term incentive by 10% in 2013 as detailed below under “—2013 Named Executive Officer Compensation Elements—Long-Term Incentive Compensation”. It was also a factor in continuing reductions in target long-term incentive compensation for 2014 as detailed below under “—Actions Related to 2014 Executive Compensation”.

The Company’s CEO has an active role in executive compensation, and typically makes recommendations to and participates in discussions with the Compensation Committee in order to provide information regarding the compensation of the other named executive officers. Following such recommendations, the Committee discusses the compensation of each named executive officer and approves the final named executive officer compensation amounts, subject to such modifications as it deems appropriate. The Committee discusses the compensation of the CEO in executive session with its independent compensation consultant and approves his final compensation amounts. Following such approvals, the Compensation Committee provides a report of its executive compensation decisions to the full Board of Directors for discussion and

ratification. The CEO, not being a member of the Compensation Committee, does not vote at Compensation Committee meetings, and he does not participate in the Board’s vote on the acceptance and approval of the Compensation Committee’s recommendations or reports with respect to his compensation.

In addition to the participation of our CEO, other members of senior management typically provide the CEO and Compensation Committee and its advisors with detailed analyses and recommendations regarding each element of named executive officer compensation to facilitate the Compensation Committee’s annual review of named executive officer compensation.

Chesapeake performed well in 2013. The Company ended 2013 as the second-largest producer of natural gas and the 11th largest producer of oil and natural gas liquids in the U.S. The Company delivered TSR of 66%, outperforming our compensation peer group. The TSR performance is a result of a sharp focus on executing our business strategy of financial discipline and profitable and efficient growth from captured resources, which led to strong operating and financial results. The Company once again delivered excellent year-over-year production growth of 11%, as adjusted for asset sales and purchases, and continued to grow liquids production to 25% of total production, all while employing half the capital than in 2012. The Company also focused on its costs in 2013, reducing

per unit production and G&A expenses by 15%. These efficiency gains allowed the Company to deliver strong year-over-year adjusted EBITDA growth of 34%. Lastly, the Company executed its strategic 2013 asset sales program, selling $4.4 billion in noncore assets. To focus management on executing our 2013 strategic plan, these and other important metrics were used as performance goals under our 2013 annual incentive program. See “—2013 Named Executive Officer Compensation Elements—Performance-Based Annual Incentives—2013 Annual Incentive Program” below on page 26 for more information with regard to the metrics used in our 2013 annual incentive program.

In December 2011, the Compensation Committee adopted substantial changes to executive compensation which were reflected in our 2012 executive compensation program. For 2013, after considering the analyses and recommendations of F.W. Cook, the Company’s performance in 2012 and the competitive market, the Compensation Committee set base salaries, incentive compensation opportunities and performance measures for 2013.

As shown below, our 2013 program continued to utilize base salary, cash awards under our annual incentive plan, restricted stock awards and PSUs under our 2005 LTIP. However, in 2013 we began granting stock options to our named executive officers as part of their long-term incentive compensation. In addition, in June 2013 we began granting restricted stock units in lieu of shares of restricted stock.

Base salaries reflect each named executive officer’s level of responsibility, leadership, tenure and contribution to the success and profitability of the Company and the competitive marketplace for executive talent specific to our industry. In early 2013, the Compensation Committee maintained base salaries for the then-serving named executive officers at 2012 levels, except for Mr. Dixon, whose compensation was increased in connection with his appointment as Acting CEO effective April 1, 2013. For Messrs. Lawler, Doyle and Pigott, who were hired during 2013, the

Compensation Committee considered compensation levels for chief executive officers of peer group companies with respect to Mr. Lawler, and peer group executives with similar titles with respect to Messrs. Doyle and Pigott, in determining their base salaries. See “—2013 Named Executive Officer Compensation Decisions—2013 CEO Compensation” and “—2013 Named Executive Officer Compensation Decisions—2013 Other Current Named Executive Officer Compensation” below for more information.

2013 Annual Incentive Program. The annual incentive component of our executive compensation program is intended to motivate and reward named executive officers for achieving our short-term business objectives that we believe drive the overall performance of the Company over the long term. In January 2013, the Compensation Committee and the Board approved the Chesapeake Energy Corporation 2013 Annual Incentive Plan, a cash-based incentive plan utilizing pre-established performance goals. The plan was subject to shareholder approval at our 2013 annual meeting of shareholders and was overwhelmingly approved. For 2013, the Compensation Committee focused heavily on implementing an annual incentive program with a formulaic approach to awarding annual

incentives based on an evaluation of the Company’s performance relative to eleven pre-established, objective operational and financial goals detailed below under “—Performance Goals and Calculation of Payout Factor”. The Committee felt that the number of goals was appropriate for 2013 as the Board’s objective was to ensure that management was focused on certain specific goals that were important to the Company in 2013, such as growth in production and proved reserves, asset sales, leasehold cost control and overhead reduction, while continuing to motivate management to focus on broader financial and operational metrics.

The Compensation Committee used the base salary in effect on the last day of 2013 in calculating the annual incentive payments. The Compensation Committee established the target percentage of base salary payable under the annual incentive program at 150% for the CEO, 125% for EVPs and 100% for SVPs (other than Messrs. Doyle and Pigott whose targets were set at 80%) to provide an annual incentive opportunity that is competitive with our peers. Following

the end of 2013, the Compensation Committee determined the payout factor based on the Company’s achievement of pre-established threshold, target and maximum performance levels and the corresponding payout opportunities of 50%, 100% and 200% of the target percentage of base salary (using linear interpolation for performance levels falling between threshold and target and between target and maximum) with no payment for performance not achieving

the minimum 50% threshold performance level, as discussed below. The following chart shows the range of annual incentive award opportunities expressed as a percentage of salary for the named

executive officers by title, based on the target percentage of base salary multiplied by the above-listed threshold, target and maximum payout opportunities.

Final annual incentive program payouts for Messrs. Lawler, Doyle and Pigott were prorated in accordance with their employment agreements for the number of days that they were employed by the Company in 2013; provided, however, the annual incentive program payout for Messrs. Lawler, Doyle and Pigott were required to be at least $800,000, $400,000 and $200,000, respectively, to account for forfeited bonus amounts from their prior employer. See “—2013 Named Executive Officer Compensation Decisions—2013 CEO Compensation” and “—2013 Named Executive Officer Compensation Decisions—2013 Other Current Named Executive Officer Compensation” below for more information. Mr. McClendon did not receive an annual incentive award in 2013. Pursuant to the terms of the Annual Incentive Plan, the other named executive officers who separated from the Company in 2013 forfeited their annual incentive awards and therefore received no payouts under the 2013 annual incentive program.

Performance Goals and Calculation of Payout Factor. For the 2013 annual incentive program, the Compensation Committee established the performance goals detailed in the table below, which it believed appropriately reflected factors that would positively impact shareholder value during 2013. The targets were drawn from the Company’s forecast, which is developed in consultation with the Board. The performance assumptions that underlie the forecast are the subject of considerable discussion during this process. Certain 2013 performance goal targets were lower than actual 2012 performance given that the Company cut its annual capital expenditure budget in half for 2013. The table below also details the Company’s level of achievement with respect to each performance goal and the final payout factor to be applied to each named executive officer’s target annual incentive award opportunity calculated using linear interpolation as described above.

Long-term incentive compensation aligns the interests of the named executive officers with our shareholders. Total target compensation is weighted heavily toward long-term incentive compensation, consistent with our goal of shareholder value creation. In 2012, the Compensation Committee and the Board approved significant modifications to our long-term incentive compensation program, incorporating PSU awards under the 2005 LTIP into the mix of long-term incentive compensation. For 2013, the Compensation Committee determined to grant long-term incentive awards, half of which consisted of PSUs and, except in the case of Mr. Lawler, half of which was equally divided between restricted stock (or restricted stock units) and stock options. This approach is intended to motivate our named executive officers to achieve our business objectives by tying incentives to the achievement of our key financial and operational performance objectives and continuing to reinforce the link between the interests of our named executive officers and our shareholders.

For named executive officers serving in January 2013, the Compensation Committee reduced the target 2013 long-term incentive opportunity by an average of over 10% compared to the 2012 long-term incentive opportunity, based on the results of the compensation peer group benchmark analysis conducted by F.W. Cook in late 2012. See “—2013 Process for Determining Executive Compensation—Benchmarking” above. Pursuant to the terms of their agreements, the named executive officers who separated in 2013 were eligible for pro rata and/or continued vesting of these awards. See “Post-Employment Compensation—Named Executive Officer Separations” on page 50 for more information. Mr. Lawler’s target annual long-term incentive compensation was more than 20% lower than Mr. McClendon’s target annual long-term incentive compensation and consisted of half PSUs and half stock options. See “—2013 Named Executive Officer Compensation Decisions—2013 CEO Compensation” below for a discussion of Mr. Lawler’s employment agreement and 2013 compensation.

2013 Restricted Stock (or Restricted Stock Units) and Stock Option Awards. Long-term incentive awards for named executive officers in 2013, other than Mr. Lawler, consisted of approximately 25% restricted stock or restricted stock units (the value of which was based on the closing price of the Company’s common stock on the grant date) and approximately 25% stock options (the value of which was determined using Black-Scholes option pricing on the grant date), each of which vest over a three-year period, which was reduced from four years based on a competitive analysis performed by F.W. Cook and to align with vesting periods of PSUs. Since 2004, the Company has provided long-term incentive compensation in the form of restricted stock granted under the 2005 LTIP. The Compensation Committee continues to believe that restricted stock grants to named executive officers play an important role in accomplishing the objectives of the executive compensation program, in particular, retention and alignment with shareholder interest. In June 2013, the Compensation Committee approved the granting of restricted stock units in lieu of shares of restricted stock, which consist of units representing the right to acquire shares of common stock on the vesting date. Holders of unvested restricted stock have full voting rights with regard to such stock and holders of unvested restricted stock and restricted stock units are entitled to receive dividends and dividend equivalents, respectively, on such stock and units. For 2013, the Compensation Committee added time-vested stock options as an element of long-term incentive compensation to further tie compensation to Company performance, given that stock options only have value if the Company’s stock price increases after the date of grant. The exercise price of the stock options is equal to the closing price of the Company’s common stock on the grant date.

2013 PSU Awards. Long-term incentive awards for named executive officers in 2013 consisted of approximately 50% cash-settled PSUs (the value of which was determined in part based on the closing price of the

Company’s common stock and in part by a Monte Carlo simulation, each on the grant date). The target PSUs vest ratably over the three-year period beginning on January 29, 2013; however, the final number and value of the PSUs paid to a named executive officer depend on the Company’s performance relative to objective performance goals during the three-year performance period ending on December 31, 2015. The Compensation

Committee established the performance goals in early 2013 based on performance measures enumerated in the 2005 LTIP and, if met, each PSU awarded entitles a named executive officer to a cash payment based on the price per share of the Company’s common stock. No dividend equivalents are paid on PSUs.

2013 PSU Performance Goals. The final number of PSUs awarded to named executive officers is determined at the end of the three-year performance period based on the Company’s performance against objective performance goals. The 2013 PSU performance goals consist of relative TSR, relative proved reserves growth and relative production growth goals measured over the three-year performance period as shown in the table below. The Committee chose all relative performance metrics for 2013 PSUs in order to motivate named executive officers to drive differential performance for the Company’s shareholders. The performance goals correlate to the

Company’s performance over the applicable performance period with modifiers expressed as a percentage, resulting in a combined range of 0 to 250% (subject to the maximum modifier described below). The Company’s performance respecting these goals will be measured against the Company’s 2013 compensation peer group consisting of Anadarko Petroleum Corporation, Apache Corporation, Continental Resources, Inc., Devon Energy Corporation, EOG Resources, Inc., Hess Corporation, Marathon Oil Corporation, Murphy Oil Corporation, Noble Energy, Inc., Occidental Petroleum Corporation and SandRidge Energy, Inc.

The final PSU modifier, which is the sum of relative total shareholder return, relative proved reserves growth and relative production growth modifiers described above, is subject to a 200% maximum that caps the award even if the aggregate modifier would be greater than 200%, a reduction of the maximum modifier of 250% used for 2012 awards. In

addition, 2013 PSUs are subject to an absolute total shareholder return “circuit breaker” that caps payouts at 100% when absolute total shareholder return is negative over the performance period. The circuit breaker does not apply if the Company’s performance results in an aggregate modifier of less than 100%.

2013 PSU Payouts. The ultimate cash payout earned by a named executive officer will be determined by multiplying the number of units, as modified above, by the average closing price per share of our common stock as reported on the New York Stock Exchange for the 20 trading

days including and immediately preceding the last day of the three-year performance period. Cash awards under the PSU program are calculated as of the end of the performance period and delivered as follows:

We believe the 2013 PSU awards granted by the Compensation Committee appropriately reflect our compensation philosophy by establishing a clear connection between the compensation of our named executive officers and the achievement of performance goals that are important for long-term value creation. The Compensation Committee determined that incorporating relative TSR performance measures with an absolute TSR circuit breaker correctly balanced accountability to shareholders for absolute TSR with the need for compensation incentives that reward named executive officers for outstanding

achievement relative to our peers even when low commodity prices weigh on our stock price. Similarly, the Compensation Committee determined that, for the 2013 PSU awards, the operational performance goals balanced two of the most important factors that drive long-term value creation for our shareholders, production growth and proved reserves growth.

All 2013 PSU awards are intended to comply with Section 162(m) of the Internal Revenue Code, or the Code.

Results for the one-year performance period PSUs granted in 2012 were measured at the end of 2012 and certified and paid in 2013. Results for the three-year performance period PSUs granted in 2012 will be measured at the end of 2014 and certified and paid in early 2015. All 2012 PSU awards are intended to comply with Section 162(m) of the Code.

Retention Awards. On January 29, 2013, the Compensation Committee approved retention awards in the form of time-vested stock options for Messrs. Dixon, Dell’Osso and Fisher of 360,000, 300,000 and 250,000 stock options, respectively. This grant was intended to promote stability and continuity during the Company’s search for a new CEO and period of transition. These stock option awards have an exercise price equal to the closing price of the Company’s common stock on the grant date and vest one-third on each of the third, fourth and fifth anniversaries of the grant date. The retention options are subject to accelerated vesting upon disability, death or if the executive is terminated (other than for cause) during the vesting period or voluntarily resigns for good reason; however, the options will be forfeited if the executive voluntarily terminates employment, other than for good reason, including by means of retirement or resignation. Messrs. Dixon and Fisher were eligible for accelerated vesting of these awards upon their separation in 2013 due to involuntary termination of employment without cause. See “Post-Employment Compensation—Named Executive Officer Separations” on page 50 for more information.

Other Compensation Arrangements

We also provide compensation in the form of benefits and perquisites to the named executive officers, including health and welfare insurance benefits, matching contributions of common stock under the Company’s 401(k) plan and nonqualified deferred compensation plan (up to 15% of an employee’s annual base salary and cash bonus compensation) and financial planning services. The named executive officers also receive

benefits for which there is no incremental cost to the Company, such as tickets to certain sporting and cultural events. The foregoing benefits and perquisites are provided to all employees or large groups of senior-level employees. From time to time, a named executive officer’s spouse will accompany the named executive officer on business trips using the fractionally-owned Company aircraft. See “Executive Compensation Tables—All Other Compensation Table” below for more information.

The Company’s executive security procedures, which prescribe the level of personal security to be provided to the CEO and other executive officers, are based on business-related security concerns and are an integral part of the Company’s overall risk management and security program. These procedures have been assessed by an independent security consulting firm and deemed necessary and appropriate for the protection of the named executive officers. The security services and equipment provided to the Company’s executive officers may be viewed as conveying personal benefits to the executives and, as a result, the value of such services and equipment is required to be reported in the “Executive Compensation Tables—Summary Compensation Table” below. In 2013, only Messrs. Lawler and McClendon received such services.

As part of its review of executive compensation in 2012, the Compensation Committee undertook a comprehensive review of executive officer perquisites in order to ensure that the Company’s practices were in line with its peers. The review resulted in the elimination of the personal use of fractionally owned Company aircraft by all executive officers, other than Mr. McClendon, effective September 30, 2012. In addition, we provided certain perquisites, subject to certain reimbursements, exclusively to Mr. McClendon for the portion of time that he served as our CEO in 2013 that are detailed below under “Executive Compensation Tables—All Other Compensation Table”. The Company includes the above benefits and perquisites as taxable income to the executive on Form W-2 after each fiscal year, in accordance with Internal Revenue Service, or IRS, guidelines. The Company does not provide tax gross-up payments for these amounts.

The Compensation Committee takes a comprehensive approach in determining the mix and level of named executive officer compensation by making an overall assessment of the performance of the named executive officer team and the role and relative contribution of each member of that team. Each named executive officer’s target 2013 compensation was based on a comprehensive review of his individual performance as described below and, in the case of Messrs. Lawler, Doyle and Pigott who joined the Company in 2013, based on benchmarking data and negotiations related to securing their employment

with the Company. In addition, each named executive officer serving as such on January 1, 2013, except for Mr. McClendon, entered into a new employment agreement with the Company, providing for base salary, cash bonus, equity compensation and certain other benefits. Mr. Lawler entered into an employment agreement effective June 17, 2013 and Messrs. Doyle and Pigott entered into employment agreements effective August 14, 2013. For more information on the employment agreements, see “Executive Compensation Tables—Employment Agreements” on page 41.

Robert D. (“Doug”) Lawler

Effective June 17, 2013, Robert D. Lawler became the Company’s President and CEO. During 2013, competition for chief executive officers was fierce in our industry given that several exploration and production companies had CEO vacancies and were competing for talent. The Board determined that Mr. Lawler, then an executive with a competitor company, was the prime candidate for our CEO position and began negotiations to secure his services. With the assistance of F.W. Cook, in negotiating the appropriate compensation for Mr. Lawler, the Compensation Committee considered the compensation arrangements of CEOs of our compensation peer group companies and the amount of equity compensation and pension benefits that Mr. Lawler would forfeit following his departure from his previous employer. Based on this analysis and as a result of these negotiations, the Compensation Committee approved total target annual compensation for Mr. Lawler that ranked slightly below the median of our compensation peer group according to benchmarking data provided by F.W. Cook, including an initial base salary of $1,250,000, a target annual incentive award of 150% (prorated for 2013 for the amount of time employed with the Company in 2013 but guaranteed to be at least $800,000 for 2013 to account for his forfeited bonus from his prior employer) and grants of long-term incentive compensation with an aggregate grant date value of $10,500,000, half in the form of PSUs and half in the form of stock options, with similar terms and conditions to awards made to other executive officers in 2013. In addition, in recognition of equity and pension benefits forfeited by Mr. Lawler upon his accepting a position with the Company, Mr. Lawler

received (i) a cash signing bonus of $2,000,000 immediately following his start date; (ii) a grant of restricted stock with an aggregate grant date fair value of $2,500,000 that vests on the second, third and fourth anniversaries of the date of grant; (iii) a grant of restricted stock with an aggregate grant date fair value of $5,000,000 that vests on the third, fourth and fifth anniversaries of the date of grant; and (iv) entitlement to an additional grant of restricted stock with an aggregate grant date fair value of $5,000,000, to be made on June 17, 2018, that would vest on the third, fourth and fifth anniversaries of the date of grant. The cash signing bonus was subject to repayment if Mr. Lawler was terminated for cause or he terminated without good reason prior to March 31, 2014. The right to future equity awards is subject to Mr. Lawler’s continued employment The Committee believed that the additional awards were essential to ensure that the Company attracted an outstanding talent to the Company while ensuring that much of Mr. Lawler’s compensation was retentive yet subject to forfeiture under appropriate circumstances.

The annual incentive payment of $1,619,260 made to Mr. Lawler for 2013 was based on the achievement of pre-established performance targets, prorated for the amount of time he was employed in 2013. The Board and Committee believe that Mr. Lawler performed exceptionally in executing the Company’s business strategy in 2013, and no adjustments were made to Mr. Lawler’s payouts for individual performance. For specific details regarding Mr. Lawler’s 2013 compensation, see “Executive Compensation Tables—Summary Compensation Table” on page 38 of this proxy statement.

Domenic J. (“Nick”) Dell’Osso

In setting Mr. Dell’Osso’s 2013 compensation, the Compensation Committee considered, among other things, Mr. Dell’Osso’s impact on the execution of the Company’s strategic and financial plan, the quality of the Company’s financial reporting and the negotiation and the execution of various asset sale and financing transactions by Mr. Dell’Osso’s team, all in light of the Company’s overall performance. Mr. Dell’Osso has continually demonstrated exemplary individual performance; however, due to the Company’s financial performance and the results of the Company’s benchmarking survey conducted in late 2012, his 2013 base salary and target annual incentive opportunity were maintained at 2012 levels of $725,000 and 125%, respectively, and his target long-term incentive compensation was $5,750,000, essentially flat with 2012 levels. As described above under “—2013 Named Executive Officer Compensation Elements—Long-Term Incentive Compensation—Retention Awards”, Mr. Dell’Osso received 300,000 retention stock options in an effort to promote stability and continuity during the Company’s search for a new CEO and period of transition.

For 2013, Mr. Dell’Osso received payments of $1,442,750 and $889,557, respectively, under the 2013 annual incentive and 2012 PSU programs. Payments made to Mr. Dell’Osso pursuant to the annual incentive and PSU programs in 2013 were based on the achievement of pre-established performance targets. In evaluating Mr. Dell’Osso’s 2013 individual performance, the Committee considered the aforementioned factors and also Mr. Dell’Osso’s essential role in the Company’s transformation in 2013, including serving as a member of the Office of the Chairman from April 1, 2013 to June 17, 2013. The Committee believes that Mr. Dell’Osso performed exceptionally in 2013, and no adjustments were made to Mr. Dell’Osso’s payouts for individual performance. For specific details regarding Mr. Dell’Osso’s 2013

compensation, see “Executive Compensation Tables—Summary Compensation Table” on page 38 of this proxy statement.

Douglas J. Jacobson

In setting Mr. Jacobson’s 2013 compensation, the Compensation Committee considered, among other things, his contributions to the execution of the Company’s asset sale program, and the resulting impact of the foregoing on the Company’s overall performance. Despite Mr. Jacobson’s exemplary performance, due to the Company’s financial performance and the results of the Company’s benchmarking survey conducted in late 2012, Mr. Jacobson’s 2013 base salary and target annual incentive opportunity were maintained at 2012 levels of $800,000 and 125%, respectively. Mr. Jacobson’s 2013 target long-term incentive compensation was decreased by approximately 15% from 2012 levels to $5,250,000 in order to further align Mr. Jacobson with benchmarking data. In lieu of a grant of retention stock options and given Mr. Jacobson’s focus on the Company’s asset sale program, the Compensation Committee awarded Mr. Jacobson a one-time individual performance bonus of $1.5 million upon the closing of, and in consideration of his efforts with regard to, the Company’s Mississippi Lime joint venture transaction with Sinopec International Petroleum Exploration and Production Corporation. The transaction was completed on June 28, 2013 and provided for the sale of a 50% undivided interest in approximately 850,000 net acres in northern Oklahoma for total consideration of $1.02 billion.

For 2013, Mr. Jacobson received payments of $1,592,000 and $1,043,498, respectively, under the 2013 annual incentive and 2012 PSU programs. Payments made to Mr. Jacobson pursuant to the annual incentive and PSU programs in 2013 were based on the achievement

of pre-established performance targets. In evaluating Mr. Jacobson’s performance in 2013, the Committee considered Mr. Jacobson’s impact on the Company’s asset sale program. The Committee believes Mr. Jacobson performed exceptionally in executing on the asset sale program in 2013, and no adjustments were made to Mr. Jacobson’s payouts for individual performance. For specific details regarding Mr. Jacobson’s 2013 compensation, see “Executive Compensation Tables—Summary Compensation Table” on page 38 of this proxy statement.

M. Christopher Doyle

Mr. Doyle joined the Company from a competitor company on August 14, 2013. With the assistance of F.W. Cook and input from Mr. Lawler, in negotiating appropriate compensation for Mr. Doyle, the Compensation Committee considered the compensation arrangements of similarly situated executives of our compensation peer group companies and the amount of equity compensation and pension benefits that Mr. Doyle would forfeit following his departure from his previous employer. Based on this analysis and as a result of these negotiations, the Compensation Committee approved total target annual compensation for Mr. Doyle that ranged between the 25^th percentile and the median of benchmarking data provided by F.W. Cook, including an initial base salary of $550,000, a target annual incentive award of 80% (prorated for 2013 for the amount of time employed with the Company in 2013 but guaranteed to be at least $400,000 for 2013 to account for his forfeited bonus from his prior employer) and grants of long-term incentive compensation with an aggregate grant date value of $1,700,000, half in the form of PSUs and half equally divided between restricted stock units and stock options, with similar terms and conditions to awards made to other executive officers in 2013. In addition, in recognition of equity and pension benefits forfeited by Mr. Doyle upon his accepting a position with the Company, Mr. Doyle received (i) a cash signing bonus of $500,000 immediately following his start date; and (ii) an additional grant of restricted stock units with an aggregate grant date fair value of $3,300,000 that vests on the third, fourth and fifth anniversaries of the date of grant, subject to continued employment. The cash signing bonus is subject to repayment if Mr. Doyle is terminated for cause or he terminates without good reason prior to August 14, 2015. The Committee believed that the additional awards were essential to ensure that the Company attracted an outstanding talent to the Company while ensuring that much of Mr. Doyle’s compensation was retentive yet subject to forfeiture under appropriate circumstances.

The annual incentive payment of $400,000 made to Mr. Doyle for 2013 was based on the achievement of pre-established performance targets, prorated for the amount of time he was employed in 2013, and adjusted based on the contractual minimum payment in his employment agreement. In evaluating Mr. Doyle’s 2013 individual performance, the Committee considered Mr. Doyle’s essential role in the Company’s transformation and reorganization in 2013. Mr. Doyle led major initiatives at the Company, including initiatives to ensure that the Company is drilling its best wells, reducing costs and increasing efficiencies, which we believe will benefit the Company and its shareholders for years to come, in addition to ensuring operational execution in the Northern Division. In light of his performance and positive impact on the Company’s

operations, the Compensation Committee awarded Mr. Doyle a one-time individual performance bonus of $100,000 for 2013. For specific details regarding Mr. Doyle’s 2013 compensation, see “Executive Compensation Tables—Summary Compensation Table” on page 38 of this proxy statement.

Mikell J. (“Jason”) Pigott

Mr. Pigott joined the Company from a competitor company on August 14, 2013. With the assistance of F.W. Cook and input from Mr. Lawler, in negotiating appropriate compensation for Mr. Pigott, the Compensation Committee considered the compensation arrangements of similarly situated executives of our compensation peer group companies and the amount of equity compensation and pension benefits that Mr. Pigott would forfeit following his departure from his previous employer. Based on this analysis and as a result of these negotiations, the Compensation Committee approved total target annual compensation for Mr. Pigott that ranged between the 25^th percentile and the median of benchmarking data provided by F.W. Cook, including an initial base salary of $500,000, a target annual incentive award of 80% (prorated for 2013 for the amount of time employed with the Company in 2013 but guaranteed to be at least $200,000 for 2013 to account for his forfeited bonus from his prior employer) and grants of long-term incentive compensation with an aggregate grant date value of $1,700,000, half in the form of PSUs and half equally divided between restricted stock units and stock options, with similar terms and conditions to awards made to other executive officers in 2013. In addition, in recognition of equity and pension benefits forfeited by Mr. Pigott upon his accepting a position with the Company, Mr. Pigott received (i) a cash signing bonus of $500,000 immediately following his start date; and (ii) an additional grant of restricted stock units with an aggregate grant date fair value of $3,300,000 that vests on the third, fourth and fifth anniversaries of the date of grant, subject to continued employment. The cash signing bonus is subject to repayment if Mr. Pigott is terminated for cause or he terminates without good reason prior to August 14, 2015. The Committee believed that the additional awards were essential to ensure that the Company attracted an outstanding talent to the Company while ensuring that much of Mr. Pigott’s compensation was retentive yet subject to forfeiture under appropriate circumstances.

The annual incentive payment of $244,252 made to Mr. Pigott for 2013 was based on the achievement of pre-established performance targets, prorated for the amount of time he was employed in 2013. In evaluating Mr. Pigott’s 2013 individual performance, the Committee considered Mr. Pigott’s essential role in the Company’s transformation and reorganization in 2013. Mr. Pigott led major initiatives at the Company, including initiatives to ensure that the Company is drilling its best wells, reducing costs and increasing efficiencies, which we believe will benefit the Company and its shareholders for years to come, in addition to ensuring operational execution in the Southern Division. In light of his performance and positive impact on the Company’s operations, the Compensation Committee awarded Mr. Pigott a one-time individual performance bonus of $55,748 for 2013. For specific details regarding Mr. Pigott’s 2013 compensation, see “Executive Compensation Tables—Summary Compensation Table” on page 38 of this proxy statement.

Aubrey K. McClendon

On January 29, 2013, the Company announced that Mr. McClendon would step down as President, CEO and a director of the Company effective April 1, 2013. Mr. McClendon continued to receive his base salary through his departure on April 1. On April 18, 2013, the Company and Mr. McClendon entered into a Founder Separation and Services Agree-

ment which was effective as of January 29, 2013 and which covered severance compensation and long-term incentive compensation granted to Mr. McClendon on January 29, 2013. See “Post-Employment Compensation—Named Executive Officer Separations—Aubrey K. McClendon” on page 50 for a discussion of the Founder Separation and Services Agreement.

Steven C. Dixon

In January 2013, the Compensation Committee reduced Mr. Dixon’s total target compensation by more than 10% based on the Company’s financial performance and the results of the Company’s benchmarking survey conducted in late 2012. To do so, the Committee held Mr. Dixon’s base salary and annual incentive award opportunity flat at $860,000 and 125%, respectively, and reduced his target long-term incentive compensation by approximately 15% to bring Mr. Dixon’s target long-term incentive opportunity more in line with peers. As described above under “—2013 Named Executive Officer Compensation Elements—Long-Term Incentive Compensation—Retention Awards”, Mr. Dixon received 360,000 retention stock options in an effort to promote stability and continuity during the Company’s search for a new CEO and period of transition. Upon Mr. Dixon’s appointment as Acting CEO effective April 1, 2013, his base salary was increased from $860,000 to $975,000 and his 2013 annual incentive target opportunity was increased from 125% to 150% of base salary. Effective September 24, 2013, the Company terminated Mr. Dixon’s employment without cause as defined in his employment agreement. See “Post-Employment Compensation—Named Executive Officer Separations—Other Departed Named Executive Officers” on page 51 for a discussion of severance payments made to Mr. Dixon pursuant to his employment agreement.

Jeffrey A. Fisher

In January 2013, the Compensation Committee slightly reduced Mr. Fisher’s total target compensation based on the Company’s financial performance and the results of the Company’s benchmarking survey conducted in late 2012. To do so, the Committee held Mr. Fisher’s base salary and annual incentive award opportunity flat at $860,000 and 125%, respectively, and reduced his target long-term incentive compensation by approximately 3%. As described above under “—2013 Named Executive Officer Compensation Elements—Long-Term Incentive Compensation—Retention Awards”, Mr. Fisher received 250,000 retention stock options in an effort to promote stability and continuity during the Company’s search for a new CEO and period of transition. Effective September 24, 2013, the Company terminated Mr. Fisher’s employment without cause as defined in his employment agreement. See “Post-Employment Compensation—Named Executive Officer Separations—Other Departed Named Executive Officers” on page 51 for a discussion of severance payments made to Mr. Fisher pursuant to his employment agreement.

We maintain employment agreements with the named executive officers, the material terms of which are described throughout this proxy statement and in detail below under “Executive Compensation Tables—Employment Agreements” on page 41. The Compensation Committee periodically reviews the terms of the agreements, generally focusing on the permitted activities allowed for the named executive officers and the competitiveness, value and adequacy of the severance arrangements.

The terms of our equity compensation and nonqualified deferred compensation plans also govern the payments and benefits named executive officers are entitled to upon the occurrence of specified termination events. Please refer to “Post-Employment Compensation” beginning on page 48 for additional details of the employment agreements and termination arrangements for the named executive officers.

The Compensation Committee has established minimum stock ownership levels for our executive officers, including the named executive officers, because we believe stock ownership directly aligns their interests with those of our shareholders. The Compensation Committee reviews compliance with the minimum stock ownership guidelines semi-annually.

Historically, the Compensation Committee established minimum stock ownership levels in our executive officers’ employment agreements. Effective for 2013, the Compensation Committee adopted stand-alone minimum stock ownership guidelines for the Company’s executive officers. Executives are expected to be in compliance with these minimum guidelines within five years of employment or assignment to a new organizational tier. All named executive officers are currently in

compliance with these minimum guidelines. The stock ownership policy requires that each executive own at least a number of shares of common stock equal to a multiple of the executive’s base salary, measured against the value of the executive’s holdings, based on the greater of a spot price or the trailing 36-month average closing price of the Company’s common stock. After achieving the minimum stock ownership guidelines, each executive must continue to meet the minimum stock ownership guidelines for his or her current office. An executive that has fallen out of compliance with the guidelines has six months to cure, measured from the later of the date of receipt of written notice of non-compliance or the first day of the next open trading window following receipt of such notice. The ownership guidelines are as follows:

Our Insider Trading Policy applies to directors and employees and prohibits derivative or speculative transactions involving Company stock. In March 2013, the Compensation Committee revised the policy, eliminating the practice of applying the prohibition only with respect to shares held in satisfaction of the minimum stock ownership guidelines and making the policy an outright prohibition on any derivative or speculative transactions involving Company stock. The transactions

covered by the policy include trading in puts, calls, covered calls or other derivative securities involving Company stock or engaging in hedging or monetization transactions with respect to Company stock. The policy also prohibits directors and executive officers from holding Company stock in a margin account or pledging Company stock as collateral for a loan. We believe the expanded application of the prohibition more effectively aligns each officer’s interests with those of our long-term shareholders.

In 2012, the Board adopted a compensation recovery policy, also known as a “clawback,” pursuant to which the Company will recover from any current or former executive officer incentive-based compensation in the event of an accounting restatement resulting from the Company’s material noncompliance with financial reporting requirements under applicable securities laws. The amount of incentive-based compensation subject to recovery would be the amount in excess of what the executive officer would have earned in accordance with the restatement as determined by the Compensation Committee.

The Company also maintains compensation recovery provisions relating to stock options, restricted shares and PSUs. Under these provisions, the Company may cancel such long-term incentive awards, in whole or in part, whether or not vested, of executives who engage in serious breaches of conduct, including violations of employment agreements, confidentiality or other proprietary matters, or otherwise act in competition with the business of the Company. We believe these provisions serve to ensure that executives act in the best interest of the Company and its shareholders.

Our Compensation Committee performed a review of key attributes and structures of the Company’s compensation policies and programs and has determined that they do not encourage excessive or inappropriate risk taking and do not create risks that are reasonably likely to have a material adverse effect on the Company for the following reasons:

In structuring executive compensation, the Company analyzes the anticipated accounting and tax treatment of various arrangements and payments, including the deductibility of executive compensation under Section 162(m) of the Code. Section 162(m) limits the annual tax deduction to $1 million for compensation paid by a publicly held company to its chief executive officer and each of the company’s three other most highly compensated named executive officers (other than the chief financial officer), unless such compensation qualifies as performance-based compensation under Section 162(m). Accounting for compensation arrangements is prescribed by the Financial Accounting Standards Board. In determining the design of our incentive arrangements, the accounting and tax treatment or method was

considered, but the accounting for or deductibility of compensation is not a determinative factor in compensation decisions. In 2013, we awarded compensation that is not deductible under Section 162(m) because we believed it was consistent with our compensation objectives and would be in the best interest of the Company and its shareholders. For example, the Compensation Committee recognized that the 2013 grant of restricted stock and restricted stock units is not deductible under Section 162(m), but believed that its retentive value outweighed any impact resulting from the inability to claim such a deduction. As detailed on page 28 under “—2013 Named Executive Officer Compensation—2013 Named Executive Officer Compensation Elements—Long-Term Incentive Compensation”, the 2013

PSU awards were designed with the intent to qualify as performance-based compensation under Section 162(m). Additionally, the 2013 Annual Incentive Plan was approved by shareholders at our 2013 annual meeting of shareholders and annual incentive awards granted in 2013 under this plan were intended to qualify as performance-based compensation under Section 162(m). However, because of the fact-based nature of the

“performance-based compensation” exception under Section 162(m) and the limited availability of binding guidance thereunder, the Company cannot guarantee that compensation will qualify for exemption under Section 162(m) of the Code, which would prevent us from taking a deduction.

After considering the information and recommendations provided by F.W. Cook and Pay Governance, the Company’s performance in 2013 and the competitive market data, the Compensation Committee set base salaries, incentive compensation opportunities and performance measures for 2014. The Compensation Committee held Mr. Lawler’s 2014 total target compensation, including base salary, target annual incentive opportunity and target long-term incentive opportunity, at 2013

levels, which is below the median of the Company’s compensation peer group. Although certain competitive upward adjustments were made to Messrs. Doyle and Pigott’s total target compensation for 2014, the average 2014 total target compensation for current named executive officers other than Mr. Lawler was reduced by approximately 25% as compared to the annualized 2013 total target compensation.

In 2014, the Compensation Committee again assessed the compensation peer group, and determined to replace SandRidge Energy, Inc. with Encana Corporation, due primarily to Encana’s similarity to the Company in size and scope. The updated peer group below will be used for judging

relative TSR for 2014 PSUs, as explained below, and for benchmarking 2015 compensation of our named executive officers, including base salary, target annual incentive opportunities and target long-term incentive opportunities.

The 2014 annual incentive program was established pursuant to the Annual Incentive Plan, which was approved by shareholders at the 2013 annual meeting. As with the 2013 annual incentive program, the annual incentive awards made under the Annual Incentive Plan are subject to a

formulaic methodology for determining award payments based on the Company’s achievement of performance goals established by the Compensation Committee before, or during the initial quarter of, the performance period.