1
EXHIBIT 1.4
CONOCO FUNDING COMPANY ("ISSUER")
DEBT SECURITIES
FULLY AND UNCONDITIONALLY GUARANTEED BY
CONOCO INC. ("CONOCO")
TERMS AGREEMENT
October 3, 2001
To: The Representatives of the Underwriters identified herein
Dear Sirs:
The Issuer agrees to sell to the several Underwriters named in Schedule
A hereto for their respective accounts, on and subject to the terms and
conditions of the Underwriting Agreement to be filed by Conoco in its Report on
Form 8-K dated October 3, 2001 ("UNDERWRITING AGREEMENT"), the following
securities ("OFFERED SECURITIES") on the following terms:
TITLE: 5.45% Notes Due 2006 ("2006 NOTES").
6.35% Notes Due 2011 ("2011 NOTES").
7.25% Notes Due 2031 ("2031 NOTES").
PRINCIPAL AMOUNT: $1,250,000,000 of 2006 Notes.
$1,750,000,000 of 2011 Notes.
$500,000,000 of 2031 Notes.
INTEREST: 5.45% per annum on the 2006 Notes, 6.35% per annum
on the 2011 Notes and 7.25% per annum on the 2031 Notes, in each case
from October 11, 2001, payable semiannually on April 15 and October 15,
commencing April 15, 2002.
MATURITY: October 15, 2006 for the 2006 Notes.
October 15, 2011 for the 2011 Notes.
October 15, 2031 for the 2031 Notes.
OPTIONAL REDEMPTION: The Issuer may elect to redeem and repay
the Offered Securities of each series, in whole or in part, at any time
and from time to time, according to the price formula set forth in the
Prospectus.
SINKING FUND: None.
LISTING: Luxembourg Stock Exchange.
2
2
PURCHASE PRICE: 99.856% of principal amount of the 2006 Notes;
99.838% of principal amount of the 2011 Notes; and 98.794% of principal
amount of the 2031 Notes plus, in each case, accrued interest, if any,
from October 11, 2001.
UNDERWRITERS' FEE: 0.35% of principal amount of the 2006
Notes, 0.45% of principal amount of the 2011 Notes; and 0.875% of
principal amount of the 2031 Notes.
CASH PURCHASE PRICE: 99.856% of principal amount of the 2006
Notes less a fee equal to 0.35% of the principal amount; 99.838% of
principal amount of the 2011 Notes less a fee equal to 0.45% of the
principal amount; 98.794% of principal amount of the 2031 Notes less a
fee equal to 0.875% of the principal amount plus, in each case, accrued
interest, if any, from October 11, 2001.
EXPECTED REOFFERING PRICE: 99.856% of principal amount of
the 2006 Notes, 99.838% of principal amount of the 2011 Notes,
and 98.794% of principal amount of the 2031 Notes, in each case
subject to change by the Representatives.
CLOSING: 10:00 A.M. on October 11, 2001, at the offices of
Cravath, Swaine & Xxxxx, 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
in Federal (same day) funds.
SETTLEMENT AND TRADING: Book-Entry Only via DTC.
BLACKOUT: Until 14 days after the Closing Date.
NAMES AND ADDRESSES OF REPRESENTATIVES:
Credit Suisse First Boston Corporation
00 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
X.X. Xxxxxx Securities Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Xxxxxxx Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
The respective principal amounts of the Offered Securities to be
purchased by each of the Underwriters are set forth opposite their names in
Schedule A hereto.
The provisions of the Underwriting Agreement are incorporated herein by
reference. The Material Subsidiaries of the Company are Conoco Inc. (formerly
Continental Oil Company), Conoco Limited, Conoco (U.K.) Limited and Conoco
Canada Resources Limited.
Each Underwriter severally represents and agrees that (i) it has not
offered or sold, and prior to the date six months after the date of issue of the
Offered Securities will not
3
3
offer or sell, any Offered Securities to persons in the United Kingdom except to
persons whose ordinary activities involve them in acquiring, holding, managing
or disposing of investments (as principal or agent) for the purpose of their
businesses or otherwise in circumstances which have not resulted and will not
result in an offer to the public in the United Kingdom within the meaning of the
Public Offers of Securities Regulations 1995; (ii) it has complied and will
comply with all applicable provisions of the Financial Services Xxx 0000 with
respect to anything done by it in relation to the Offered Securities in, from or
otherwise involving the United Kingdom; (iii) it has only issued or passed on
and will only issue or pass on in the United Kingdom any document received by it
in connection with the issue of the Offered Securities to a person who is of a
kind described in Article 11(3) of the Financial Services Xxx 0000 (Investment
Advertisements) (Exemptions) Order 1996 or is a person to whom such document may
otherwise lawfully be issued or passed on; and (iv) it will comply with all
applicable securities laws and regulations in force in any jurisdiction in which
it purchases, offers, sells or delivers Offered Securities or possesses or
distributes the Prospectus.
For purposes of Section 6 of the Underwriting Agreement, the only
information furnished to the Company by any Underwriter for use in the
Prospectus consists of the following information in the Prospectus furnished on
behalf of each Underwriter: the third and fourth paragraphs under the caption
"Underwriting" in the prospectus supplement and the information contained in the
paragraphs regarding the United Kingdom in the sixth paragraph, the sentence
regarding market making in the next paragraph and the 10th and 11th paragraphs
under the caption "Underwriting" in the prospectus supplement.
4
4
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to the Company one of the counterparts hereof,
whereupon it will become a binding agreement among the Issuer, Conoco and the
several Underwriters in accordance with its terms.
Very truly yours,
Conoco Inc.
By /s/ Xxxx X. Xxxxxxxxxx
---------------------------------
Name: Xxxx X. Xxxxxxxxxx
Title: Senior Vice President,
Legal, and General Counsel
Conoco Funding Company
By /s/ Xxxx X. Xxxxxxxxxx
----------------------------------
Name: Xxxx X. Xxxxxxxxxx
Title: Vice President
and General Counsel
The foregoing Terms Agreement is hereby confirmed and accepted as of the date
first above written.
Credit Suisse First Boston Corporation,
X.X. Xxxxxx Securities Inc.,
Xxxxxxx Xxxxx Xxxxxx Inc.,
Acting on behalf of themselves and as
the Representatives of the several Underwriters.
By X.X. Xxxxxx Securities Inc.
By /s/ Xxxxx Xxxxxxxxxxx
--------------------------------
Name: Xxxxx Xxxxxxxxxxx
Title: Vice President
5
SCHEDULE A
PRINCIPAL PRINCIPAL PRINCIPAL
AMOUNT OF AMOUNT OF AMOUNT OF
UNDERWRITER 2006 NOTES 2011 NOTES 2031 NOTES
----------- ---------- ---------- ----------
Credit Suisse First Boston Corporation..... $337,500,000 $472,500,000 $135,000,000
X.X. Xxxxxx Securities Inc................. 337,500,000 472,500,000 135,000,000
Xxxxxxx Xxxxx Barney Inc. ................. 337,500,000 472,500,000 135,000,000
Banc of America Securities LLC............. 62,500,000 87,500,000 25,000,000
Deutsche Bank Alex. Xxxxx Inc.............. 62,500,000 87,500,000 25,000,000
The Royal Bank of Scotland plc............. 62,500,000 87,500,000 25,000,000
Barclays Capital Inc....................... 8,333,334 11,666,667 3,333,334
Commerzbank Capital Markets Corp........... 8,333,334 11,666,667 3,333,334
Credit Lyonnais Securities (USA) Inc....... 8,333,333 11,666,667 3,333,333
Mizuho International plc................... 8,333,333 11,666,667 3,333,333
XX Xxxxx Securities Corporation ........... 8,333,333 11,666,666 3,333,333
SunTrust Capital Markets, Inc. ........... 8,333,333 11,666,666 3,333,333
------------- ------------- -----------
Total 1,250,000,000 1,750,000,000 500,000,000
============= ============= ===========
