the audited financial statements of Chesapeake Utilities as of and for the year ended December 31, 2022;

the unaudited interim financial statements of Chesapeake Utilities as of and for the nine months ended September 30, 2023;

the audited financial statements of FCG as of and for the year ended December 31, 2022; and

the unaudited interim financial statements of FCG as of and for the nine months ended September 30, 2023.

Property, Plant and Equipment

Regulated energy

Unregulated energy

Other businesses and eliminations

Total property, plant and equipment

Less: Accumulated depreciation and amortization

Plus: Construction work in progress

Net property, plant and equipment

Current Assets

Cash and cash equivalents

Trade and other receivables

Less: Allowance for credit losses

Trade receivables, net

Accrued revenue

Propane inventory, at average cost

Other inventory, at average cost

Natural gas for sale

Regulatory assets

Storage gas prepayments

Income taxes receivable

Prepaid expenses

Derivative assets, at fair value

Other current assets

Total current assets

Deferred Charges and Other Assets

Goodwill

Other intangible assets, net

Investments, at fair value

Derivative assets, at fair value

Operating lease right-of-use assets

Regulatory assets

Receivables and other deferred charges

Prepaid pension asset

Prepaid software service costs

Deferred software implementation costs

Miscellaneous deferred debits

Deferred rate case expenses

Other receivables and other deferred charges

Total deferred charges and other assets

Total Assets

Capitalization and Liabilities

Stockholders’ equity

Preferred stock, par value $0.01 per share (authorized 2,000,000 shares)

Common stock, par value $0.4867 per share (authorized 50,000,000 shares)

Additional paid-in capital

Retained earnings

Accumulated other comprehensive loss

Deferred compensation obligation

Treasury stock

Total stockholders’ equity

Long-term debt, net of current maturities

Total capitalization

Current Liabilities

Current portion of long-term debt

Short-term borrowing

Due to affiliates

Accounts payable

Customer deposits and refunds

Accrued interest

Dividends payable

Income taxes payable

Other accrued taxes

Accrued compensation

Regulatory liabilities

Derivative liabilities, at fair value

Construction accruals

Other accrued liabilities

Total current liabilities

Deferred Credits and Other Liabilities

Deferred income taxes

Accrued removal costs

Regulatory liabilities

Environmental liabilities

Other pension and benefit costs

Derivative liabilities, at fair value

Lease liabilities

Other liabilities

Total deferred credits and other liabilities

Other commitments and contingencies

Total Capitalization and Liabilities

Operating Revenues

Regulated Energy

Unregulated Energy and Other

Total operating revenues

Operating Expenses

Natural gas and electricity costs

Propane and natural gas costs

Operations

Transaction-related expenses

Maintenance

Depreciation and amortization

Other taxes

Total operating expenses

Operating Income

Other income, net

Interest charges, net

Income Before Income Taxes

Income Taxes

Net Income

Weighted Average Common Shares Outstanding:

Basic

Diluted

Earnings Per Share of Common Stock:

Basic Earnings Per Share of Common Stock

Diluted Earnings Per Share of Common Stock

Operating Revenues

Regulated Energy

Unregulated Energy

Other businesses and eliminations

Total operating revenues

Operating Expenses

Natural gas and electricity costs

Propane and natural gas costs

Operations

Maintenance

Depreciation and amortization

Other taxes

Total operating expenses

Operating Income

Other income, net

Interest charges, net

Income Before Income Taxes

Income Taxes

Net Income

Weighted Average Common Shares Outstanding:

Basic

Diluted

Earnings Per Share of Common Stock:

Basic Earnings Per Share of Common Stock

Diluted Earnings Per Share of Common Stock

the audited financial statements of Chesapeake Utilities as of and for the year ended December 31, 2022;

the unaudited interim financial statements of Chesapeake Utilities as of and for the nine months ended September 30, 2023;

the audited financial statements of FCG as of and for the year ended December 31, 2022; and

the unaudited interim financial statements of FCG as of and for the nine months ended September 30, 2023.

Total shares of Chesapeake Utilities common stock issued

Offer price of Chesapeake Utilities common stock on November 9, 2023

Equity portion of purchase price

Issuance of long-term debt

Short-term borrowings under the Revolver

Total

Total current assets

Property, plant and equipment

Goodwill

Regulatory assets

Other deferred charges and other assets, including intangible assets

Total assets

Total current liabilities

Regulatory liabilities

Deferred credits and other liabilities

Total liabilities

Total purchase price

Reflects property, plant and equipment with a net book value of $9.5 million related to software that was excluded from the Acquisition and retained by FPL.

Reflects a reduction in FCG’s cash balance to the minimum cash amount of $2.0 million as defined in the Purchase Agreement.

Reflects $0.2 million of affiliated accounts receivable at September 30, 2023 which was an asset excluded from the Acquisition and retained by FPL.

Represents the excess of the Company’s purchase price of $923.4 million over the estimated fair values of assets acquired and liabilities assumed.

Reflects estimated working capital adjustments that in accordance with the Purchase Agreement were treated as an adjustment to the Acquisition purchase price.

Reflects $43.8 million in right of use assets and lease liabilities associated with long-term transportation service agreements between FCG and Peninsula Pipeline Company (“PPC”), a wholly owned subsidiary of the Company. Upon closing of the Acquisition, these agreements have been classified as affiliate transactions and the associated assets and liabilities are being eliminated in the Company’s consolidated balance sheet.

Reflects $4.9 million of prepaid pension expenses that were excluded from the Acquisition.

Reflects FCG’s $0.2 million unamortized loss on reacquired debt which was excluded from the Acquisition.

Reflects transaction fees associated with the Company’s receipt of the $965 million bridge loan facility which was not required to be drawn upon to finance the acquisition that are being reclassified to expense in accordance with the accounting rules prescribed by U.S. GAAP.

Reflects the Company’s debt and equity financings related to the Acquisition and the associated transaction-related costs including: $550.0 million of new long-term debt, the issuance of 4.4 million shares of Chesapeake Utilities Corporation common stock, and $16.3 million of new short-term borrowings under the Company’s Revolver.

Represents $13.1 million of fees associated with the November 2023 issuance of 4.4 million shares of the Company’s common stock to finance the Acquisition. The Company received $366.4 million of net proceeds from the common stock issuance after underwriting discounts, commissions and expenses.

Reflects the elimination of FCG’s stockholder’s equity.

Represents $10.6 million of total non-recurring direct incremental transaction-related expenses expected to be incurred in connection with the Acquisition, which would reduce deferred income tax liabilities by $2.7 million, including but not limited to, legal, consulting, audit and financing fees. These expenses are reflected as an adjustment to retained earnings, less income tax effects, on the unaudited pro forma condensed combined balance sheet at September 30, 2023.

Represents $2.9 million of debt issuance costs that have been reflected as a reduction to the Company’s issuance of long-term debt to finance the Acquisition. The Company issued $550.0 million in new long-term notes in November 2023 at an average interest rate of 6.54 percent.

Reflects $156.3 million of affiliated debt of FCG that was settled prior to the closing of the Acquisition.

Reflects $3.3 million of affiliated accounts payable that was settled prior to the closing of the Acquisition.

As defined in the Purchase Agreement, the Company and FCG have elected to apply the provision of Section 338(h)(10) of the IRC, which recharacterizes the stock purchase as an asset purchase for federal tax purposes. The Company received a tax basis in the acquired assets equal to the purchase price and will depreciate the assets at their purchased value and goodwill recorded in connection with the Acquisition will be amortized for tax purposes over the next 15 years. As a result, FCG’s deferred tax asset related to tax reform legislation was the only deferred tax balance transferred to the Company with the Acquisition.

Represents $0.9 million of interest expense associated with long-term transportation service agreements between FCG and PPC, a wholly owned subsidiary of the Company. Upon closing of the Acquisition, these agreements have been classified as affiliate transactions and the associated revenues and expenses are being eliminated in the Company’s consolidated results.

Represents $1.0 million of depreciation expense associated with long-term transportation service agreements between FCG and PPC, a wholly owned subsidiary of the Company. Upon closing of the Acquisition, these agreements have been classified as affiliate transactions and the associated revenues and expenses are being eliminated in the Company’s consolidated results.

Reflects $0.4 million of pension expenses related to benefit plan obligations that were excluded from the Acquisition.

Reflects $0.7 million of depreciation expense related to software that was excluded from the Acquisition and retained by FPL.

Reflects $5.5 million of interest expense related to outstanding debt of FCG that was settled prior to the Acquisition.

Reflects a $27.0 million net increase to interest expense resulting from the Company’s issuance of long-term debt to finance the Acquisition. The Company issued $550.0 million in new long-term notes in November 2023 at an average interest rate of 6.54 percent.

Reflects a $0.8 million increase in interest expense resulting from incremental borrowings under the Company’s Revolver at an interest rate of 6.17 percent. Such incremental borrowings were used to finance the Acquisition and pay certain transaction-related expenses in connection with the Acquisition and related financing activities.

Reflects the income tax effects of pro forma adjustments based on the Company’s blended federal and state effective tax rate for the nine months ended September 30, 2023.

Reflects the 4.4 million shares of the Company’s common stock issued in November 2023 to finance the Acquisition.

Represents $0.3 million of interest expense associated with long-term transportation service agreements between FCG and PPC, a wholly owned subsidiary of the Company. Upon closing of the Acquisition, these agreements have been classified as affiliate transactions and the associated revenues and expenses are being eliminated in the Company’s consolidated results.

Represents $0.5 million of depreciation expense associated with long-term transportation service agreements between FCG and PPC, a wholly owned subsidiary of the Company. Upon closing of the Acquisition, these agreements have been classified as affiliate transactions and the associated revenues and expenses are being eliminated in the Company’s consolidated results.

Reflects $1.0 million of pension expenses related to benefit plan obligations that were excluded from the Acquisition.

Reflects $0.8 million of depreciation expense related to software that was excluded from the Acquisition and retained by FPL.

Reflects $6.2 million of interest expense related to outstanding debt of FCG that was settled prior to the Acquisition.

Reflects a $36.0 million net increase to interest expense resulting from the Company’s issuance of long-term debt to finance the Acquisition. The Company issued $550.0 million in new long-term notes in November 2023 at an average interest rate of 6.54 percent.

Reflects a $1.0 million increase in interest expense resulting from incremental borrowings under the Company’s Revolver at an interest rate of 6.17 percent. Such incremental borrowings were used to finance the Acquisition and pay certain transaction-related expenses in connection with the Acquisition and related financing activities.

Reflects the income tax effects of pro forma adjustments based on the Company’s blended federal and state effective tax rate for the year ended December 31, 2022.

Reflects the 4.4 million shares of the Company’s common stock issued in November 2023 to finance the Acquisition.