Newfield Exploration Company Underwriting Agreement
EXECUTION
VERSION
Exhibit 1.1
Newfield Exploration Company
March 29, 2006
To the Representatives of the several
Underwriters named in the respective
Pricing Agreements hereinafter described
Underwriters named in the respective
Pricing Agreements hereinafter described
Ladies and Gentlemen:
From time to time Newfield Exploration Company, a Delaware corporation (the “Company”),
proposes to enter into one or more Pricing Agreements (each a “Pricing Agreement”) in the form of
Annex I hereto, with such additions and deletions as the parties thereto may determine, and,
subject to the terms and conditions stated herein and therein, to issue and sell to the firms named
in Schedule I to the applicable Pricing Agreement (such firms constituting the “Underwriters” with
respect to such Pricing Agreement and the securities specified therein) certain of its debt
securities (the “Securities”), specified in Schedule II to such Pricing Agreement (with respect to
such Pricing Agreement, the “Firm Designated Securities”). If specified in such Pricing Agreement,
the Company may grant the Underwriters the right to purchase at their election an additional
principal amount of Securities specified in such Pricing Agreement as provided in Section 3 hereof
(the “Optional Designated Securities”). The Firm Designated Securities and the Optional Designated
Securities, if any, which the Underwriters elect to purchase pursuant to Section 3 hereof are
herein collectively referred to as the “Designated Securities.”
The terms and rights of any particular issuance of Designated Securities shall be as specified
in the Pricing Agreement relating thereto and in or pursuant to the indenture (the “Indenture”)
identified in such Pricing Agreement.
1. Particular sales of Designated Securities may be made from time to time to the Underwriters
of such Designated Securities, for whom the firms designated as representatives of the Underwriters
of such Designated Securities in the Pricing Agreement relating thereto will act as representatives
(the “Representatives”). The term “Representatives” also refers to a single firm acting as sole
representative of the Underwriters and to an Underwriter or Underwriters who act without any firm
being designated as its or their representative. This Underwriting Agreement shall not be
construed as an obligation of the Company to sell any of the Securities or as an obligation of any
of the Underwriters to purchase any of the Securities. The obligation of the Company to issue and
sell any of the Securities and the obligation of any of the Underwriters to purchase any of the
Designated Securities shall be evidenced by the Pricing Agreement with respect to the Designated
Securities specified therein. Each Pricing Agreement shall specify the aggregate principal amount
of the Firm Designated Securities, the maximum principal amount of Optional Designated Securities,
if any, the initial public offering price of such Firm and Optional Designated Securities or the
manner of determining such price, the terms of the Designated
Securities, the purchase price to the Underwriters of such Designated Securities, the names of
the Underwriters of such Designated Securities, the names of the Representatives of such
Underwriters, the principal amount of such Designated Securities to be purchased by each
Underwriter and the commission, if any, payable to the Underwriters with respect thereto and shall
set forth the date, time and manner of delivery of such Firm Designated Securities and Optional
Designated Securities, if any, and payment therefor. The Pricing Agreement shall also specify (to
the extent not set forth in the Indenture, the Registration Statement, the Time of Sale Prospectus
and the Prospectus (as defined) with respect thereto) the terms of such Designated Securities. A
Pricing Agreement shall be in the form of an executed writing (which may be in counterparts), and
may be evidenced by an exchange of telegraphic communications or any other rapid transmission
device designed to produce a written record of communications transmitted. The obligations of the
Underwriters under this Agreement and each Pricing Agreement shall be several and not joint.
The Company has filed with the Securities and Exchange Commission (the “Commission”) a
registration statement, including a prospectus, (File No. 333-124120) on Form S-3, relating to
securities of the Company, including the Securities, to be issued from time to time by the Company.
The registration statement as amended to the date of this Agreement, including the information (if
any) deemed to be part of the registration statement at the time of effectiveness pursuant to Rule
430A or Rule 430B under the Securities Act of 1933, as amended (the “Securities Act”), is
hereinafter referred to as the “Registration Statement,” and the related prospectus covering the
Securities dated April 26, 2005 in the form first used to confirm sales of the Securities (or in
the form first made available to the Underwriters by the Company to meet requests of purchasers
pursuant to Rule 173 under the Securities Act) is hereinafter referred to as the “Basic
Prospectus.” The Basic Prospectus, as supplemented by the prospectus supplement specifically
relating to the Designated Securities in the form first used to confirm sales of the Designated
Securities (or in the form first made available to the Underwriters by the Company to meet requests
of purchasers pursuant to Rule 173 under the Securities Act) is hereinafter referred to as the
“Prospectus,” and the term “preliminary prospectus” means any preliminary form of the Prospectus.
For purposes of this Agreement, “free writing prospectus” has the meaning set forth in Rule 405
under the Securities Act, “Time of Sale Prospectus” means the preliminary prospectus together with
the free writing prospectuses, if any, prepared by or on behalf of the Company or used or referred
to by the Company in connection with the offering of the Designated Securities that the Company has
filed, or is required to file, pursuant to Rule 433(d) under the Securities Act (each, an “Issuer
Free Writing Prospectus”), and any other documents or information identified in Schedule II hereto
and as of the Time of Sale (as defined on Schedule II hereto). As used herein, the terms
“Registration Statement,” “Basic Prospectus,” “preliminary prospectus,” “Time of Sale Prospectus”
and “Prospectus” shall include the documents, if any, incorporated by reference therein. The terms
“supplement,” “amendment,” and “amend” as used herein with respect to the Registration Statement,
the Basic Prospectus, the Time of Sale Prospectus, any preliminary prospectus or free writing
prospectus shall include all documents subsequently filed by the Company with the Commission
pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are deemed
to be incorporated by reference therein.
2. The Company represents and warrants to, and agrees with, each of the Underwriters that:
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(a) The Registration Statement has become effective; no stop order suspending the
effectiveness of the Registration Statement is in effect, and no proceedings for such
purpose are pending before or threatened by the Commission.
(b) The documents incorporated by reference in the Time of Sale Prospectus or the
Prospectus, when they became effective or were filed with the Commission, as the case may
be, conformed in all material respects to the requirements of the Securities Act or the
Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and
none of such documents contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the statements therein
not misleading; and any further documents so filed and incorporated by reference in the
Prospectus or any further amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be, will conform in all material
respects to the requirements of the Securities Act or the Exchange Act, as applicable, and
the rules and regulations of the Commission thereunder and will not contain an untrue
statement of a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the Company by an
Underwriter of Designated Securities through the Representatives expressly for use in the
Time of Sale Prospectus or the Prospectus;
(c) (i) The Registration Statement, the Time of Sale Prospectus and the Prospectus
conform, and any further amendments or supplements to the Registration Statement, the Time
of Sale Prospectus or the Prospectus relating to the Designated Securities will conform, in
all material respects to the requirements of the Securities Act and the Trust Indenture Act
of 1939, as amended (the “Trust Indenture Act”), and the rules and regulations of the
Commission thereunder; (ii) each part of the Registration Statement, when such part became
effective, did not contain, and each such part, as amended or supplemented, if applicable,
will not contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not misleading;
(iii) the Time of Sale Prospectus did not, at the Time of Sale, as then amended or
supplemented by the Company, if applicable, contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading; and (iv) the Prospectus, as of
its date and the Time of Delivery, as amended or supplemented, if applicable, did not and
will not contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that this representation and warranty shall
not apply to (A) any statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter of Designated Securities
through the Representatives expressly for use in the Time of Sale Prospectus or the
Prospectus or (B) that part of the Registration Statement that constitutes the Statement of
Eligibility (Form T-1) under the Trust Indenture Act of the Trustee;
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(d) The Company is not an “ineligible issuer” in connection with the offering pursuant
to Rules 164, 405 and 433 under the Securities Act. Any Issuer Free Writing Prospectus has
been, or will be, filed with the Commission in accordance with the requirements of the
Securities Act and the applicable rules and regulations of the Commission thereunder. Each
Issuer Free Writing Prospectus that the Company has filed, or is required to file, pursuant
to Rule 433(d) under the Securities Act complies or will comply, when issued or filed
pursuant to Rule 433, in all material respects with the requirements of the Securities Act
and the applicable rules and regulations of the Commission thereunder. Except for the
Issuer Free Writing Prospectuses, if any, identified in Schedule II hereto and electronic
road shows each furnished to the Representatives before first use, the Company has not
prepared, used or referred to, and will not, without your prior consent, prepare, use or
refer to, any Issuer Free Writing Prospectus. Each Issuer Free Writing Prospectus used in
connection with the offering of the Designated Securities does not conflict with the
information contained in the Registration Statement, the Time of Sale Prospectus or the
Prospectus.
(e) Neither the Company nor any of its subsidiaries has sustained since the date of the
latest audited financial statements included or incorporated by reference in the Time of
Sale Prospectus any material loss or interference with the business of the Company and its
subsidiaries, taken as a whole, from fire, explosion, flood or other calamity, whether or
not covered by insurance, or from any labor dispute or court or governmental action, order
or decree, otherwise than as set forth or contemplated in the Time of Sale Prospectus; and,
other than as set forth or contemplated in the Time of Sale Prospectus, since the respective
dates as of which information is given in the Registration Statement and the Time of Sale
Prospectus, there has not been any material change in the capital stock or long-term debt of
the Company or any of its subsidiaries or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the general affairs,
management, financial position, stockholders’ equity or results of operations of the Company
and its subsidiaries, taken as a whole;
(f) The Company and its subsidiaries have (i) generally satisfactory title to all
their interests in their producing oil and gas properties and to all of their material
interests in nonproducing oil and gas properties, title investigations having been carried
out by the Company in accordance with the general practice in the oil and gas industry, (ii)
good and indefeasible title to all other real property owned by them that is material to the
Company and its subsidiaries taken as a whole, and (iii) good and valid title to all
personal property owned by them that is material to the Company and its subsidiaries taken
as a whole, in each case free and clear of all liens, encumbrances, claims, security
interests, subleases and defects except such as are described in the Time of Sale Prospectus
or such as do not materially affect the value of such property and do not interfere with the
use made and proposed to be made of such property by the Company and its subsidiaries; and
any real property (other than oil and gas properties) and buildings material to the Company
and its subsidiaries taken as a whole held under lease by the Company and its subsidiaries
are held by them under valid, subsisting and enforceable leases (except as enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer, preference and other similar laws relating to or affecting creditors’ rights
generally and general principles of equity,
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regardless of whether considered in a proceeding at law or in equity), with such
exceptions as are not material and do not interfere with the use made and proposed to be
made of such property and buildings by the Company and its subsidiaries;
(g) The Company has been duly incorporated and is validly existing as a corporation in
good standing under the laws of the State of Delaware, with power and authority (corporate
and other) to own, lease and operate its properties and conduct its business as described in
the Time of Sale Prospectus and to enter into and perform its obligations under this
Agreement, and has been duly qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each other jurisdiction in which it owns
or leases properties or conducts any business so as to require such qualification, or is
subject to no material liability or disability by reason of the failure to be so qualified
in any such jurisdiction; and each “significant subsidiary” of the Company (as such term is
defined in Rule 1-02 of Regulation S-X under the Securities Act, a “Subsidiary”) has been
duly incorporated or otherwise organized and is validly existing as a corporation or other
entity in good standing under the laws of its jurisdiction of incorporation or organization;
(h) The Company has an authorized capitalization as set forth in the Time of Sale
Prospectus, and all of the outstanding shares of capital stock of the Company have been duly
and validly authorized and issued and are fully paid and non-assessable; and all of the
outstanding shares of capital stock or other ownership interests of each Subsidiary of the
Company have been duly and validly authorized and issued, are fully paid and non-assessable
and (except for directors’ qualifying shares or similar ownership and as otherwise set forth
in the Time of Sale Prospectus) are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims;
(i) The Designated Securities have been duly and validly authorized, and, when (1) the
Firm Designated Securities are issued and delivered pursuant to this Agreement and the
Pricing Agreement with respect to such Firm Designated Securities and, (2) if any of the
Optional Designated Securities are issued and delivered pursuant to Over-allotment Options
(as defined in Section 3 hereof) with respect to such Optional Designated Securities, such
Designated Securities will constitute valid and legally binding obligations of the Company
entitled to the benefits provided by the Indenture, enforceable in accordance with their
terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws
of general applicability relating to or affecting creditors’ rights and to general equity
principles, and will have been duly authorized and duly qualified under the Trust Indenture
Act and, at the Time of Delivery for such Designated Securities (as defined in Section 4
hereof), the Indenture will constitute a valid and legally binding instrument, enforceable
in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or affecting creditors’
rights and to general equity principles; and the Indenture conforms, and the Designated
Securities will conform, to the descriptions thereof contained in the Time of Sale
Prospectus with respect to the Designated Securities;
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(j) The issue and sale of the Designated Securities and the compliance by the Company
with all of the provisions of the Designated Securities, the Indenture, this Agreement, any
Pricing Agreement and each Overallotment Option, if any, and the consummation of the
transactions contemplated herein and therein will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement, lease or other agreement or instrument
to which the Company or any of its subsidiaries is a party or by which the Company or any of
its subsidiaries is bound or to which any of the properties or assets of the Company or any
of its subsidiaries is subject, nor will such action result in any violation of the
provisions of the certificate of incorporation or bylaws of the Company or any statute or
any order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its properties, and no consent, approval,
authorization, order, registration or qualification of or with any such court or
governmental agency or body is required for the issue and sale of the Designated Securities
or the consummation by the Company of the transactions contemplated by this Agreement, any
Pricing Agreement or any Overallotment Option, except such as have been, or will have been
prior to each Time of Delivery, obtained under the Securities Act and the Trust Indenture
Act and such consents, approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the purchase and
distribution of the Designated Securities by the Underwriters;
(k) Neither the Company nor any of its subsidiaries is in violation of its charter,
bylaws or other organizational documents or in default in the performance or observance of
any material obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or instrument to which it
is a party or by which it or any of its properties may be bound, other than any such default
that would not have a material adverse effect on the financial position, stockholders’
equity, results of operations, business or prospects of the Company and its subsidiaries,
taken as a whole (a “Material Adverse Effect”);
(l) The statements set forth in the Prospectus and the Time of Sale Prospectus under
the captions “Description of Debt Securities” and “Description of the Notes,” and in the
Prospectus and the Time of Sale Prospectus, insofar as they purport to constitute a summary
of the terms of the Designated Securities, the Securities, and the Indenture, respectively,
and under the captions “Underwriting” and “Plan of Distribution,” insofar as they purport to
describe the provisions of the laws and documents referred to therein, are accurate in all
material respects;
(m) The consolidated financial statements of the Company, including the notes thereto,
included or incorporated by reference in the Time of Sale Prospectus present fairly, in all
material respects, the consolidated financial position of the Company and its subsidiaries
as at the dates indicated and the results of their operations and cash flows for the periods
specified; except as otherwise stated in the Time of Sale Prospectus, said financial
statements have been prepared in conformity with generally accepted accounting principles
applied on a consistent basis, except in the case of unaudited financial statements for the
absence of notes thereto and subject to normal year-end adjustments; and the selected
historical financial data for the Company included in the
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Time of Sale Prospectus as amended and supplemented have been compiled on a basis
consistent with that of the audited or unaudited, as applicable, consolidated financial
statements of the Company; any pro forma financial statements or data included or
incorporated by reference in the Time of Sale Prospectus comply as to form in all material
respects with the applicable accounting requirements of Regulation S-X under the Securities
Act to the extent applicable, and the pro forma adjustments have been properly applied to
the historical amounts in the compilation of those statements; the other financial and
statistical data set forth or incorporated by reference in the Time of Sale Prospectus
related to the Company are accurately presented and prepared on a basis consistent with the
financial statements and books and records of the Company, and there are no financial
statements (historical or pro forma) that are required to be included in the Time of Sale
Prospectus that are not included as required;
(n) The Company owns or possesses adequate rights to use the patents, patent rights,
licenses, inventions, copyrights, know-how (including seismic data, trade secrets and other
unpatented or unpatentable proprietary or confidential information, systems or procedures),
trademarks, service marks and trade names (collectively, “patent and proprietary rights”) to
the extent employed by it in and material to the business now operated by it, and the
Company has not received any notice of infringement of or conflict with asserted rights of
others with respect to any patent or proprietary rights, which infringement or conflict (if
the subject of any unfavorable decision, ruling or finding), singly or in the aggregate,
would result in a Material Adverse Effect;
(o) The Company possesses such licenses, permits, consents, orders, certificates or
authorizations issued by the appropriate federal, state, foreign or local regulatory
agencies or bodies necessary to conduct the business now operated by it, except for
licenses, permits, consents, orders, certificates or authorizations, the absence of which,
individually or in the aggregate, would not have a Material Adverse Effect, and the Company
has not received any notice of proceedings relating to the revocation or modification of any
such licenses, permits, consents, orders, certificates or authorizations which, singly or in
the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a
Material Adverse Effect;
(p) Other than as set forth in the Time of Sale Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its subsidiaries is a party
or of which any property of the Company or any of its subsidiaries is the subject, except as
would not have a Material Adverse Effect; and, to the knowledge of the Company, no such
proceedings are threatened or contemplated by governmental authorities or threatened by
others;
(q) The Company carries, or is covered by, insurance in such amounts and covering such
risks as is customary for companies engaged in similar businesses in similar industries;
(r) Except as described in the Time of Sale Prospectus, there has been no storage,
disposal, generation, manufacture, spill, discharge, refinement, transportation, handling or
treatment of toxic wastes, hazardous wastes or hazardous substances by the
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Company (or to the knowledge of the Company, any of its predecessors in interest) at,
upon or from any of the property now or previously owned or leased or under contract for
purchase by the Company in violation of any applicable law, ordinance, rule, regulation,
order, judgment, decree or permit or which would require remedial action under any
applicable law, ordinance, rule, regulation, order, judgment, decree or permit, except for
any violation or remedial action which would not have singularly or in the aggregate with
all such violations and remedial actions, any Material Adverse Effect; and the terms
“hazardous wastes,” “toxic wastes” and “hazardous substances” shall have the meanings
specified in any applicable local, state, federal and foreign laws or regulations with
respect to environmental protection;
(s) The Company is not and, after giving effect to the offering and sale of the
Designated Securities, will not be an “investment company” as such term is defined in the
Investment Company Act of 1940, as amended (the “Investment Company Act”);
(t) The Company maintains disclosure controls and procedures (as such term is defined
in Rule 13a-14 under the Exchange Act), which (i) are designed to ensure that material
information relating to the Company, including its subsidiaries, is made known to the
principal executive officer and the principal financial officer of the Company by others
within the Company, particularly during the periods in which the periodic reports required
under the Exchange Act are being prepared, and (ii) have been evaluated for effectiveness as
of a date within 90 days prior to the filing date of each report requiring certification
under Rule 13a-14 under the Exchange Act filed with the Commission;
(u) Based on its evaluation of its disclosure controls and procedures, the Company is
not aware of (i) any significant deficiency in the design or operation of internal controls
which could adversely affect its ability to record, process, summarize and report financial
data or any material weaknesses in internal controls, or (ii) any fraud, whether or not
material, that involves management or other employees who have a significant role in the
internal controls of the Company;
(v) Since the date of the most recent evaluation of such disclosure controls and
procedures, there have been no significant changes in internal controls or in other factors
that could significantly affect internal controls, including any corrective actions with
regard to significant deficiencies and material weaknesses;
(w) The Audit Committee of the Company’s Board of Directors complies with the
applicable and currently effective requirements of the New York Stock Exchange and the
Commission; and
(x) PricewaterhouseCoopers LLP, who have audited certain financial statements of the
Company and its subsidiaries, is an independent registered public accounting firm as
required by the Securities Act and the rules and regulations of the Commission thereunder.
3. Upon the execution of the Pricing Agreement applicable to any Designated Securities and
authorization by the Representatives of the release of the Firm Designated
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Securities, the several Underwriters propose to offer the Firm Designated Securities for sale
upon the terms and conditions set forth in the Prospectus.
The Company may specify in the Pricing Agreement applicable to any Designated Securities that
the Company thereby grants to the Underwriters the right (an “Overallotment Option”) to purchase at
their election up to the principal amount of Optional Designated Securities set forth in such
Pricing Agreement, on the terms set forth in the paragraph above, for the sole purpose of covering
sales of Designated Securities sin excess of the Firm Designated Securities. Any such election to
purchase Optional Designated Securities may be exercised by written notice from the Representatives
to the Company, given within a period specified in the Pricing Agreement, setting forth the
aggregate principal amount of Optional Designated Securities to be purchased and the date on which
such Optional Designated Securities are to be delivered, as determined by the Representatives but
in no event earlier than the First Time of Delivery (as defined in Section 4 hereof) or, unless the
Representatives and the Company otherwise agree in writing, earlier than or later than the
respective number of business days after the date of such notice set forth in such Pricing
Agreement.
The principal amount of Optional Designated Securities to be added to the principal amount of
Firm Designated Securities to be purchased by each Underwriter as set forth in Schedule I to the
Pricing Agreement applicable to such Designated Securities shall be, in each case, the principal
amount of Optional Designated Securities which the Company has been advised by the Representatives
have been attributed to such Underwriter; provided that, if the Company has not been so advised,
the principal amount of Optional Designated Securities to be so added shall be, in each case, that
proportion of Optional Designated Securities which the principal amount of Firm Designated
Securities to be purchased by such Underwriter under such Pricing Agreement bears to the aggregate
principal amount of Firm Designated Securities (rounded as the Representatives may determine to the
nearest 1,000 dollars). The total principal amount of Designated Securities to be purchased by all
the Underwriters pursuant to such Pricing Agreement shall be the aggregate principal amount of Firm
Designated Securities set forth in Schedule I to such Pricing Agreement plus the aggregate
principal amount of Optional Designated Securities which the Underwriters elect to purchase.
4. Designated Securities to be purchased by each Underwriter pursuant to the Pricing Agreement
relating thereto, in the form specified in such Pricing Agreement, and in such authorized
denominations and registered in such names as the Representatives may request upon at least
forty-eight hours’ prior notice to the Company, shall be delivered by or on behalf of the Company
to the Representatives for the account of such Underwriter, against payment by such Underwriter or
on its behalf of the purchase price therefor by wire transfer of Federal (same-day) funds to the
account specified by the Company to the Representatives at least forty-eight hours in advance as
specified in such Pricing Agreement, (i) with respect to the Firm Designated Securities, all in the
manner and at the place and time and date specified in such Pricing Agreement or at such other
place and time and date as the Representatives and the Company may agree upon in writing, such time
and date being herein called the “First Time of Delivery,” and (ii) with respect to the Optional
Designated Securities, if any, in the manner and at the time and date specified by the
Representatives in the written notice given by the Representatives of the Underwriters’ election to
purchase such Optional Designated Securities, or at such other time and date as the Representatives
and the Company may agree upon in writing, such time and date,
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if not the First Time of Delivery, being herein called the “Second Time of Delivery.” Each
such time and date for delivery is herein called a “Time of Delivery.”
5. The Company agrees with each of the Underwriters of any Designated Securities:
(a) To prepare the Prospectus as amended and supplemented in relation to the applicable
Designated Securities in a form approved by the Representatives and to file such Prospectus
pursuant to Rule 424(b) under the Securities Act not later than the Commission’s close of
business on the second business day following the execution and delivery of the Pricing
Agreement relating to the applicable Designated Securities or, if applicable, such earlier
time as may be required by Rule 424(b); to make no further amendment or any supplement to
the Registration Statement, Prospectus or Time of Sale Prospectus after the date of the
Pricing Agreement or any Issuer Free Writing Prospectus relating to such Designated
Securities and prior to any Time of Delivery for such Designated Securities which shall be
disapproved by the Representatives for such Designated Securities promptly after reasonable
notice thereof; to advise the Representatives promptly of any such amendment or supplement
or any Issuer Free Writing Prospectus after any Time of Delivery for such Designated
Securities and furnish the Representatives with copies thereof; to file promptly all reports
and any definitive proxy or information statements required to be filed by the Company with
the Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act for so
long as the delivery of a prospectus is required in connection with the offering or sale of
such Designated Securities, and during such same period to advise the Representatives,
promptly after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed with the Commission, of the issuance by
the Commission of any stop order or of any order preventing or suspending the use of any
prospectus relating to such Designated Securities, of the suspension of the qualification of
such Designated Securities for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request by the Commission for
the amending or supplementing of the Registration Statement or Prospectus or for additional
information; and, in the event of the issuance of any such stop order or of any such order
preventing or suspending the use of any prospectus relating to such Designated Securities or
suspending any such qualification, promptly to use its best efforts to obtain the withdrawal
of such order;
(b) Not to take any action that would result in an Underwriter or the Company being
required to file with the Commission pursuant to Rule 433(d) under the Securities Act a free
writing prospectus prepared by or on behalf of the Underwriter that the Underwriter
otherwise would not have been required to file thereunder; and to file promptly all material
required to be filed with the Commission pursuant to Rule 433(d) under the Securities Act,
including any pricing term sheet identified on Schedule II hereto.
(c) If the Time of Sale Prospectus is being used to solicit offers to buy the
Designated Securities at a time when the Prospectus is not yet available to prospective
purchasers and any event shall occur or condition exist as a result of which it is necessary
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to amend or supplement the Time of Sale Prospectus in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading, or if
any event shall occur or condition exist as a result of which the Time of Sale Prospectus
conflicts with the information contained in the Registration Statement then on file, or if,
in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the
Time of Sale Prospectus to comply with applicable law, forthwith to prepare, file with the
Commission and furnish, at its own expense, to the Underwriters and to any dealer upon
request, either amendments or supplements to the Time of Sale Prospectus so that the
statements in the Time of Sale Prospectus as so amended or supplemented will not, in the
light of the circumstances when delivered to a prospective purchaser, be misleading or so
that the Time of Sale Prospectus, as amended or supplemented, will no longer conflict with
the Registration Statement, or so that the Time of Sale Prospectus, as amended or
supplemented, will comply with applicable law;
(d) If, during such period after the first date of the public offering of the
Designated Securities as in the opinion of counsel for the Underwriters the Prospectus (or
in lieu thereof the notice referred to in Rule 173(a) under the Securities Act) is required
by law to be delivered in connection with sales by an Underwriter or dealer, any event shall
occur or condition exist as a result of which it is necessary to amend or supplement the
Prospectus in order to make the statements therein, in the light of the circumstances when
the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) under the
Securities Act) is delivered to a purchaser, not misleading, or if, in the opinion of
counsel for the Underwriters, it is necessary to amend or supplement the Prospectus to
comply with applicable law, forthwith to prepare, file with the Commission and furnish, at
its own expense, to the Underwriters and to the dealers (whose names and addresses you will
furnish to the Company) to which the Designated Securities may have been sold by you on
behalf of the Underwriters and to any other dealers upon request, either amendments or
supplements to the Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the Prospectus (or in lieu
thereof the notice referred to in Rule 173(a) under the Securities Act) is delivered to a
purchaser, be misleading or so that the Prospectus, as amended or supplemented, will comply
with applicable law.
(e) Promptly from time to time to take such action as the Representatives may
reasonably request to qualify such Designated Securities for offering and sale under the
securities laws of such jurisdictions as the Representatives may request and to comply with
such laws so as to permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the distribution of such
Designated Securities, provided that in connection therewith the Company shall not be
required to qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction;
(f) On the second business day following the date of the Pricing Agreement for such
Designated Securities (or at such other date and time as set forth in the Pricing Agreement)
and from time to time thereafter, to furnish the Underwriters with copies of the
Registration Statement and the Prospectus, each as amended or supplemented, in New York City
in such quantities as the Representatives may reasonably request, and, if the
11
delivery of a prospectus is required at any time in connection with the offering or
sale of the Designated Securities and if at such time any event shall have occurred as a
result of which the Registration Statement, the Time of Sale Prospectus, or the Prospectus
as then amended or supplemented would include an untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made when such the Registration Statement, the
Time of Sale Prospectus, or Prospectus is delivered, not misleading, or, if for any other
reason it shall be necessary during such same period to amend or supplement the Registration
Statement, the Time of Sale Prospectus, or Prospectus or to file under the Exchange Act any
document incorporated by reference in the Registration Statement, the Time of Sale
Prospectus, or Prospectus in order to comply with the Securities Act, the Exchange Act or
the Trust Indenture Act, to notify the Representatives and upon their request to file such
document and to prepare and furnish without charge to each Underwriter and to any dealer in
securities as many copies as the Representatives may from time to time reasonably request of
an amended Prospectus, a supplement to the Prospectus or an Issuer Free Writing Prospectus
which will correct such statement or omission or effect such compliance;
(g) To make generally available to its security holders as soon as practicable, but in
any event not later than eighteen months after the effective date of the Registration
Statement (as defined in Rule 158(c) under the Securities Act), an earnings statement of the
Company and its subsidiaries (which need not be audited) complying with Section 11(a) of the
Securities Act and the rules and regulations of the Commission thereunder (including, at the
option of the Company, Rule 158 under the Securities Act);
(h) During the period beginning from the date of the Pricing Agreement for such
Designated Securities and continuing to and including the later of (i) the termination of
trading restrictions for such Designated Securities, as notified to the Company by the
Representatives, (ii) the last Time of Delivery for such Designated Securities and (iii) any
period specified in the Pricing Agreement, not to offer, sell, contract to sell or otherwise
dispose of any debt securities of the Company which are substantially similar to the
Designated Securities without the prior written consent of the Representatives; and
(i) If the Company elects to rely upon Rule 462(b), the Company shall file a Rule
462(b) Registration Statement with the Commission in compliance with Rule 462(b) by 10:00
P.M., Washington, D.C. time, on the date of this Agreement, and the Company shall at the
time of filing either pay the Commission the filing fee for the Rule 462(b) Registration
Statement or give irrevocable instructions for the payment of such fee pursuant to Rule
111(b) under the Securities Act.
6. The Company covenants and agrees with the several Underwriters that the Company will pay or
cause to be paid the following: (i) the fees, disbursements and expenses of the Company’s counsel,
accountants and reserve engineers in connection with the registration of the Designated Securities
under the Securities Act and all other expenses in connection with the preparation, printing and
filing of the Registration Statement, any Preliminary Prospectus and the Prospectus and amendments
and supplements thereto and any Issuer Free Writing Prospectus and the mailing and delivering of
copies thereof to the Underwriters and dealers; (ii) the cost of
12
printing or producing any Agreement among Underwriters, this Agreement, any Pricing Agreement,
the Indenture, the Securities, any Blue Sky and Legal Investment Memorandum, closing documents
(including compilations thereof) and any other documents in connection with the offering, purchase,
sale and delivery of the Designated Securities; (iii) all expenses in connection with the
qualification of the Designated Securities for offering and sale under state securities laws as
provided in Section 5(e) hereof, including the fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the Blue Sky and Legal
Investment survey(s); (iv) any fees charged by securities rating services for rating the Designated
Securities; (v) any filing fees incident to, and the fees and disbursements of counsel for the
Underwriters in connection with, any required reviews by the National Association of Securities
Dealers, Inc. of the terms of the sale of the Designated Securities; (vi) any fees and expenses in
connection with listing the Designated Securities; (vii) the cost of printing or engraving the
Designated Securities; (viii) the fees and expenses of any Trustee and any agent of any trustee and
the fees and disbursements of counsel for any trustee in connection with any Indenture and the
Securities; (ix) the cost of qualifying the Securities with The Depository Trust Company; and (x)
all other costs and expenses incident to the performance of its obligations hereunder and under the
Pricing Agreement (including with respect to any Optional Designated Securities) which are not
otherwise specifically provided for in this Section. It is understood, however, that, except as
provided in this Section, and Sections 9 and 12 hereof, the Underwriters will pay all of their own
costs and expenses, including the fees of their counsel, transfer taxes on resale of any of the
Designated Securities by them, and any advertising expenses connected with any offers they may
make.
7. The obligations of the Underwriters of any Designated Securities under the Pricing
Agreement relating to such Designated Securities shall be subject, in the discretion of the
Representatives, to the condition that all representations and warranties and other statements of
the Company in or incorporated by reference in the Pricing Agreement relating to such Designated
Securities are, at and as of each Time of Delivery for such Designated Securities, true and
correct, the condition that the Company shall have performed all of its obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus as amended or supplemented in relation to such Designated Securities
shall have been filed with the Commission pursuant to Rule 424(b) within the applicable time
period prescribed for such filing by the rules and regulations under the Securities Act and
in accordance with Section 5(a) hereof; if the Company has elected to rely upon Rule 462(b),
the Rule 462(b) Registration Statement shall have become effective by 10:00 P.M.,
Washington, D.C. time, on the date of this Agreement; no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been issued and
no proceeding for that purpose shall have been initiated or threatened by the Commission;
and all requests for additional information on the part of the Commission shall have been
complied with to the Representatives’ reasonable satisfaction;
(b) Counsel for the Underwriters shall have furnished to the Representatives such
written opinion or opinions, dated each Time of Delivery for such Designated Securities,
respectively, with respect to the incorporation of the Company, the validity of the
Indenture and the Designated Securities, the Registration Statement, the Prospectus
13
as amended and supplemented, this Agreement and the Pricing Agreement, as well as such
other related matters as the Representatives may reasonably request, and such counsel shall
have received such papers and information as they may reasonably request to enable them to
pass upon such matters;
(c) Counsel for the Company, which shall be satisfactory to the Representatives, shall
have furnished to the Representatives their written opinions, dated each Time of Delivery
for such Designated Securities, respectively, in form and substance satisfactory to the
Representatives, to the effect that:
(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with corporate
power and authority to own its properties and conduct its business as described in
the Time of Sale Prospectus;
(ii) The Company has authorized capital stock as set forth in the Time of Sale
Prospectus, and all of the outstanding shares of capital stock of the Company have
been duly and validly authorized and issued and are fully paid and non-assessable;
(iii) This Agreement and the Pricing Agreement with respect to the Designated
Securities have been duly authorized, executed and delivered by the Company;
(iv) The issue and sale by the Company of the Designated Securities being
delivered at such Time of Delivery and the compliance by the Company with all of the
provisions of the Designated Securities, the Indenture, this Agreement and the
Pricing Agreement with respect to the Designated Securities and the performance of
the Company’s obligations hereunder and thereunder will not conflict with or result
in a breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement, lease or
other agreement or instrument known to such counsel to which the Company or any of
its subsidiaries is a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company or any of its
subsidiaries is subject, nor will such action result in any violation of the
provisions of the certificate of incorporation or bylaws of the Company or any
statute or any order, rule or regulation known to us of any court or governmental
agency or body having jurisdiction over the Company or any of its subsidiaries or
any of their properties, except for any such conflicts, defaults, breaches or
violations that would not in the aggregate have a material adverse effect on the
Company’s ability to perform its obligations under this Agreement, the Indenture or
the Pricing Agreement or that would not have a Material Adverse Effect (except that
such counsel need express no opinion with respect to federal or state securities or
Blue Sky laws with respect to this subparagraph);
(v) No consent, approval, authorization, order, registration or qualification
of or with any such court or governmental agency or body is
14
required for the issue and sale of the Designated Securities being delivered at
such Time of Delivery or the performance by the Company of its obligations under the
Indenture, this Agreement or such Pricing Agreement, except such as have been
obtained under the Securities Act or the Trust Indenture Act and such consents,
approvals, authorizations, orders, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the purchase and
distribution of the Designated Securities by the Underwriters;
(vi) The statements set forth in the Prospectus and the Time of Sale Prospectus
under the caption “Description of Debt Securities” and “Description of the Notes,”
insofar as they purport to constitute a summary of the terms of the Designated
Securities or the Indenture, and under the captions “Plan of Distribution” and
“Underwriting,” insofar as they purport to describe the provisions of the laws and
documents referred to therein, are accurate in all material respects;
(vii) The Designated Securities are in the form prescribed in or pursuant to
the Indenture, have been duly and validly authorized by the Company by all necessary
corporate action and, when executed and authenticated as specified in or pursuant
to the Indenture and issued and delivered, will constitute valid and legally binding
obligations of the Company entitled to the benefits provided by the Indenture, and
will be enforceable in accordance with their terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general applicability
relating to or affecting creditors’ rights and to general equity principles; and the
Designated Securities and the Indenture conform to the descriptions thereof in the
Prospectus and in the Prospectus as amended and supplemented; the Indenture has been
duly authorized, executed and delivered by the Company and constitutes a valid and
legally binding instrument of the Company, enforceable in accordance with its terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws
of general applicability relating to or affecting creditors’ rights and to general
equity principles;
(viii) The Indenture has been duly qualified under the Trust Indenture Act;
(ix) The Company is not an “investment company” as such term is defined in the
Investment Company Act;
(x) The documents incorporated by reference in the Registration Statement, the
Prospectus and the Time of Sale Prospectus (other than the financial statements and
the notes thereto and the related schedules or other information of a financial or
reserve engineering nature therein and except for that part of the Registration
Statement that constitutes the Form T-1, as to which such counsel need express no
opinion), when they became effective or were filed with the Commission, as the case
may be, complied as to form in all material respects with the requirements of the
Securities Act or the Exchange Act, as applicable, and the rules and regulations of
the Commission thereunder; and such counsel has
15
no reason to believe that any of such documents, when they became effective or
were so filed, as the case may be, contained, in the case of a registration
statement which became effective under the Securities Act, an untrue statement of a
material fact or omitted to state a material fact requiring to be stated therein or
necessary to make the statements therein not misleading, or, in the case of other
documents which were filed under the Securities Act or the Exchange Act with the
Commission, an untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such documents were so filed, not
misleading;
(xi) the Designated Securities have been duly authorized and, when executed and
authenticated in accordance with the provisions of the Indenture and delivered to
and paid for by the Underwriters in accordance with the terms of this Agreement, in
the case of the Underwriters’ Securities, will be valid and binding obligations of
the Company, in each case enforceable in accordance with their respective terms,
subject to applicable bankruptcy, insolvency and similar laws affecting creditors’
rights generally and equitable principles of general applicability, and will be
entitled to the benefits of the Indenture;
(xii) The Registration Statement, the Time of Sale Prospectus and the
Prospectus, and any further amendments and supplements thereto made by the Company
prior to such Time of Delivery (other than the financial statements and the notes
thereto and the related schedules or other information of a financial or reserve
engineering nature therein, as to which such counsel need express no opinion), as of
their respective effective or issue dates complied as to form in all material
respects with the requirements of the Securities Act and the rules and regulations
of the Commission thereunder;
(xiii) Nothing has come to the attention of such counsel that causes such
counsel to believe that (A) any part of the Registration Statement, when such part
became effective, (except for the financial statements and financial schedules and
other financial and statistical data included therein and except for that part of
the Registration Statement that constitutes the Form T-1, as to which such counsel
need not express any belief) contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to make
the statements therein not misleading, (B) the Time of Sale Prospectus (except for
the financial statements and financial schedules and other financial and statistical
data included therein, as to which such counsel need not express any belief) as of
the Time of Sale contained any untrue statement of a material fact or omitted to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made not misleading or (C) the
Prospectus (except for the financial statements and financial schedules and other
financial and statistical data included therein, as to which such counsel need not
express any belief) as amended or supplemented, if applicable, as of its date or the
applicable Time of Delivery contained or contains any untrue statement of a material
fact or omitted or omits to state a material fact necessary in order to
16
make the statements therein, in the light of the circumstances under which they
were made not misleading.
(d) C. Xxxxxxx Xxxxxx, Legal Counsel of the Company, shall have furnished to the
Representatives his written opinion, dated each Time of Delivery for such Designated
Securities, respectively, in form and substance satisfactory to the Representatives, to the
effect that, other than as set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is a party or of which
any property of the Company or any of its subsidiaries is the subject that, if determined
adversely to the Company or any of its subsidiaries, would individually or in the aggregate
have a Material Adverse Effect; and to such counsel’s knowledge, no such proceedings are
threatened by governmental authorities or threatened by others;
(e) On the date of the Pricing Agreement for such Designated Securities at a time prior
to the execution of the Pricing Agreement with respect to such Designated Securities and at
each Time of Delivery for such Designated Securities, the independent registered public
accounting firm of the Company who have audited the financial statements of the Company and
its subsidiaries included or incorporated by reference in the Registration Statement, the
Time of Sale Prospectus and the Prospectus shall have furnished to the Representatives a
letter, dated the date of such Pricing Agreement and the date of the most recent report
filed with the Commission containing financial statements and incorporated by reference in
the Registration Statement, if the date of such report is later than the date of such
Pricing Agreement, and a letter dated such Time of Delivery, respectively, to the effect set
forth in Annex II hereto, and with respect to such letter dated such Time of Delivery, as to
such other matters as the Representatives may reasonably request and in form and substance
reasonably satisfactory to the Representatives; provided that the letter delivered on the
Closing Date shall use a “cut-off date” not earlier than the date hereof;
(f) Neither the Company nor any of its subsidiaries shall have sustained since the date
of the latest audited financial statements included or incorporated by reference in the Time
of Sale Prospectus, any loss or interference with the business of the Company and its
subsidiaries, taken as a whole, from fire, explosion, flood or other calamity, whether or
not covered by insurance, or from any labor dispute or court or governmental action, order
or decree, otherwise than as set forth or contemplated in the Time of Sale Prospectus, and
(ii) since the respective dates as of which information is given in the Time of Sale
Prospectus there shall not have been any change in the capital stock or long-term debt of
the Company or any of its subsidiaries or any change, or any development involving a
prospective change, in or affecting the general affairs, management, financial position,
stockholders’ equity or results of operations of the Company and its subsidiaries, otherwise
than as set forth or contemplated in the Time of Sale Prospectus, the effect of which, in
any such case described in clause (i) or (ii), is in the judgment of the Representatives, so
material and adverse as to make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Designated Securities on the terms and in the manner
contemplated in the Time of Sale Prospectus;
17
(g) On or after the Time of Sale (i) no downgrading shall have occurred in the rating
accorded the Company’s debt securities or preferred stock or other preferred securities by
any “nationally recognized statistical rating organization,” as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Securities Act, and (ii) no such
organization shall have publicly announced that it has under surveillance or review, with
possible negative implications, its rating of any of the Company’s debt securities or
preferred stock or such other preferred security;
(h) On or after the date of the Time of Sale there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities generally on the
New York Stock Exchange, or any setting of minimum prices for trading on such exchange, (ii)
a suspension or material limitation in trading in the Company’s securities on the New York
Stock Exchange, (iii) a general moratorium on commercial banking activities declared by
either federal or New York State or Texas State authorities, or (iv) (A) any change in U.S.
or international financial, political or economic conditions or currency exchange rates or
exchange controls, (B) any major disruption of settlements of securities or clearance
services in the United States, or (C) any attack on or outbreak or escalation of hostilities
or act of terrorism involving the United States, any declaration of war by Congress or any
other national or international calamity or emergency, if the effect of any such event
specified in this clause (iv) in the judgment of the Representatives makes it impracticable
or inadvisable to proceed with the public offering or the delivery of the Firm Designated
Securities or Optional Designated Securities, if any, or both on the terms and in the manner
contemplated in the Prospectus as first amended or supplemented relating to the Designated
Securities, whether in the primary market or in respect of dealings in the secondary market;
(i) The Designated Securities at each Time of Delivery shall have been approved for
listing, subject to notice of issuance, on any exchange or market listed in the Pricing
Agreement;
(j) The Company shall have complied with the provisions of Section 5(c) hereof with
respect to the furnishing of prospectuses and other documents on the second business day
following the date of the Pricing Agreement relating to such Designated Securities (or such
other date as set forth in the Pricing Agreement);
(k) The Company shall have furnished or caused to be furnished to the Representatives
at each Time of Delivery for the Designated Securities certificates of officers of the
Company satisfactory to the Representatives as to the accuracy of the representations and
warranties of the Company herein at and as of such Time of Delivery, as to the performance
by the Company of all of its obligations hereunder to be performed at or prior to such Time
of Delivery, as to the matters set forth in subsections (a) and (g) of this Section and as
to such other matters as the Representatives may reasonably request; and
(l) The Company shall have furnished or caused to be furnished to the Representatives,
at each Time of Delivery for the Designated Securities, a certificate of Xxxxx X. Xxxxxxxx,
chief petroleum engineer and Executive Vice President — Operations
18
and Acquisitions of the Company, regarding the estimated proved reserves and future net
cash flows from reserves data as presented in the Prospectus, in the form previously
approved by the Representatives.
8. Each Underwriter severally covenants with the Company not to issue any free writing
prospectus prepared by or on behalf of such Underwriter without the consent of the Company.
9. (a) The Company will indemnify and hold harmless each Underwriter, each person, if any,
who controls any Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act and each affiliate of any Underwriter within the meaning of Rule 405
under the Securities Act against any losses, claims, damages or liabilities, joint or several, to
which such Underwriter may become subject, under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the
Prospectus or any amendment or supplement thereto and any other prospectus relating to the
Designated Securities, the Time of Sale Prospectus, any Issuer Free Writing Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with investigating or defending any such
action or claim as such expenses are incurred; provided, however, that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement or omission or alleged omission
made in reliance upon and in conformity with written information furnished to the Company by any
Underwriter of Designated Securities through the Representatives expressly for use therein.
(b) Each Underwriter will, severally and not jointly, indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may become subject, under
the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement
of a material fact contained in any Preliminary Prospectus, any preliminary prospectus supplement,
the Registration Statement, the Prospectus as amended or supplemented and any other prospectus
relating to the Designated Securities, the Time of Sale Prospectus, any Issuer Free Writing
Prospectus or any amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged omission was made in
any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the
Prospectus and any other prospectus relating to the Designated Securities, or any amendment or
supplement thereto in reliance upon and in conformity with written information furnished to the
Company by such Underwriter through the Representatives expressly for use therein; and will
reimburse the Company for any legal or other expenses reasonably incurred by the Company in
connection with investigating or defending any such action or claim as such expenses are incurred.
19
(c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice
of the commencement of any action, such indemnified party shall, if a claim in respect thereof is
to be made against the indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the indemnifying party shall not
relieve it from any liability which it may have to any indemnified party otherwise than under such
subsection. In case any such action shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled
to participate therein and, to the extent that it shall wish, jointly with any other indemnifying
party similarly notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party (who shall not, except with the consent of the indemnified party, be counsel to
the indemnifying party), and, after notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof, the indemnifying party shall not be liable to such
indemnified party under such subsection for any legal expenses of other counsel or any other
expenses, in each case subsequently incurred by such indemnified party, in connection with the
defense thereof other than reasonable costs of investigation. In any such proceeding, any
indemnified party shall have the right to retain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the
indemnified party shall have mutually agreed to the contrary, (ii) the indemnifying party has
failed within a reasonable time to retain counsel reasonably satisfactory to the indemnified party,
(iii) the indemnified party shall have reasonably concluded that there may be legal defenses
available to it that are different from or in addition to those available to the indemnifying
party, or (iv) the named parties in any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing interests between them.
It is understood and agreed that the indemnifying party shall not, in connection with any
proceeding or related proceeding in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel) for all indemnified parties, and
that all such fees and expenses shall be reimbursed as they are incurred. Any such separate firm
for any Underwriter shall be designated in writing by the Representative and any such separate firm
for the Company shall be designated in writing by the Company. The indemnifying party shall not be
liable for any settlement of any proceeding effected without its written consent, but if settled
with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees
to indemnify each indemnified party from and against any loss or liability by reason of such
settlement or judgment. No indemnifying party shall, without the written consent of the
indemnified party, effect the settlement or compromise of, or consent to the entry of any judgment
with respect to, any pending or threatened action or claim in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified party is an actual or
potential party to such action or claim) unless such settlement, compromise or judgment (i)
includes an unconditional release of the indemnified party from all liability arising out of such
action or claim, and (ii) does not include any statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 9 is unavailable to or insufficient to
hold harmless an indemnified party under subsection (a) or (b) above in respect of any losses,
claims, damages or liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or actions in respect thereof) in
20
such proportion as is appropriate to reflect the relative benefits received by the Company on
the one hand and the Underwriters of the Designated Securities on the other from the offering of
the Designated Securities to which such loss, claim, damage or liability (or action in respect
thereof) relates. If, however, the allocation provided by the immediately preceding sentence is
not permitted by applicable law or if the indemnified party failed to give the notice required
under subsection (c) above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one hand and the Underwriters
of the Designated Securities on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as
any other relevant equitable considerations. The relative benefits received by the Company on the
one hand and such Underwriters on the other shall be deemed to be in the same proportion as the
total net proceeds from such offering (before deducting expenses) received by the Company bear to
the total underwriting discounts and commissions received by such Underwriters. The relative fault
shall be determined by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a material fact relates
to information supplied by the Company on the one hand or such Underwriters on the other and the
parties’ relative intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this subsection (d) were determined by pro rata allocation
(even if the Underwriters were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred to above in this
subsection (d). The amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above in this subsection
(d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the applicable Designated Securities
underwritten by it and distributed to the public were offered to the public exceeds the amount of
any damages which such Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent misrepresentation. The
obligations of the Underwriters of Designated Securities in this subsection (d) to contribute are
several in proportion to their respective underwriting obligations with respect to such Designated
Securities and not joint.
(e) The obligations of the Company under this Section 9 shall be in addition to any liability
which the Company may otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls any Underwriter or any affiliates of such Underwriter who purchase
Designated Securities within the meaning of the Securities Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which the respective
Underwriters may otherwise have and shall extend, upon the same terms and conditions, to each
officer of the Company who signed the Registration Statement and each director of the Company and
to each person, if any, who controls the Company within the meaning of the Securities Act.
21
10. (a) If any Underwriter shall default in its obligation to purchase the Firm Designated
Securities or Optional Designated Securities which it has agreed to purchase under the Pricing
Agreement relating to such Designated Securities, the Representatives may in their discretion
arrange for themselves or another party or other parties to purchase such Designated Securities on
the terms contained herein. If within thirty-six hours after such default by any Underwriter the
Representatives do not arrange for the purchase of such Firm Designated Securities or Optional
Designated Securities, as the case may be, then the Company shall be entitled to a further period
of thirty-six hours within which to procure another party or other parties satisfactory to the
Representatives to purchase such Designated Securities on such terms. In the event that, within
the respective prescribed period, the Representatives notify the Company that they have so arranged
for the purchase of such Designated Securities, or the Company notifies the Representatives that it
has so arranged for the purchase of such Designated Securities, the Representatives or the Company
shall have the right to postpone a Time of Delivery for such Designated Securities for a period of
not more than seven days, in order to effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus, or in any other documents or arrangements, and the
Company agrees to file promptly any amendments or supplements to the Registration Statement or the
Prospectus which in the opinion of the Representatives may thereby be made necessary. The term
“Underwriter” as used in this Agreement shall include any person substituted under this Section
with like effect as if such person had originally been a party to the Pricing Agreement with
respect to such Designated Securities.
(b) If, after giving effect to any arrangements for the purchase of the Firm Designated
Securities or Optional Designated Securities, as the case may be, of a defaulting Underwriter or
Underwriters by the Representatives and the Company as provided in subsection (a) above, the
principal amount of such Designated Securities which remains unpurchased is not 10% or more of the
aggregate principal amount of the Firm Designated Securities or Optional Designated Securities, as
the case may be, to be purchased at the respective Time of Delivery, then the Company shall have
the right to require each non-defaulting Underwriter to purchase the principal amount of Firm
Designated Securities or Optional Designated Securities, as the case may be, which such Underwriter
agreed to purchase under the Pricing Agreement relating to such Designated Securities and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata share (based on the
principal amount of Firm Designated Securities or Optional Designated Securities, as the case may
be, which such Underwriter agreed to purchase under such Pricing Agreement) of the Firm Designated
Securities or Optional Designated Securities, as the case may be, of such defaulting Underwriter or
Underwriters for which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the Firm Designated
Securities or Optional Designated Securities, as the case may be, of a defaulting Underwriter or
Underwriters by the Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of Firm Designated Securities or Optional Designated Securities, as the
case may be, which remains unpurchased is 10% or more of the aggregate principal amount of the Firm
Designated Securities or Optional Designated Securities, as the case may be, to be purchased at the
respective Time of Delivery, as referred to in subsection (b) above, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
22
Underwriters to purchase Firm Designated Securities or Optional Designated Securities, as the
case may be, of a defaulting Underwriter or Underwriters, then the Pricing Agreement relating to
such Firm Designated Securities or to such Optional Designated Securities, as the case may be,
shall thereupon terminate, without liability on the part of any non-defaulting Underwriter or the
Company, except for the expenses to be borne by the Company and the Underwriters as provided in
Section 6 hereof and the indemnity and contribution agreements in Section 9 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for its default.
11. (a) The respective indemnities, agreements, representations, warranties and other
statements of the Company and the several Underwriters, as set forth in this Agreement or made by
or on behalf of them, respectively, pursuant to this Agreement, shall remain in full force and
effect, regardless of any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or any controlling person of any Underwriter, or the Company, or any
officer or director or controlling person of the Company, and shall survive delivery of and payment
for the Designated Securities.
(b) The Company acknowledges that in connection with the offering of the Designated
Securities: (1) the Underwriters have acted at arms length, are not agents of, and owe no fiduciary
duties to, the Company or any other person; (2) the Underwriters owe the Company only those duties
and obligations set forth in this Agreement and prior written agreements (to the extent not
superseded by this Agreement), if any; and (3) the Underwriters may have interests that differ from
those of the Company. The Company waives to the full extent permitted by applicable law any claims
it may have against the Underwriters arising from an alleged breach of fiduciary duty in connection
with the offering of the Designated Securities.
12. If any Pricing Agreement or Over-allotment Option shall be terminated pursuant to Section
10 hereof, the Company shall not then be under any liability to any Underwriter with respect to the
Firm Designated Securities or Optional Designated Securities with respect to which such Pricing
Agreement shall have been terminated except as provided in Sections 6 and 9 hereof; but, if for any
other reason, Designated Securities are not delivered by or on behalf of the Company as provided
herein, the Company will reimburse the Underwriters through the Representatives for all
out-of-pocket expenses approved in writing by the Representatives, including fees and disbursements
of counsel, reasonably incurred by the Underwriters in making preparations for the purchase, sale
and delivery of such Designated Securities, but the Company shall then be under no further
liability to any Underwriter with respect to such Designated Securities except as provided in
Sections 6 and 9 hereof.
13. In all dealings hereunder, the Representatives of the Underwriters of Designated
Securities shall act on behalf of each of such Underwriters, and the parties hereto shall be
entitled to act and rely upon any statement, request, notice or agreement on behalf of any
Underwriter made or given by such Representatives jointly or by such of the Representatives, if
any, as may be designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in writing, and if to the
Underwriters shall be delivered or sent by mail or facsimile transmission to the address of the
Representatives as set forth in the Pricing Agreement; and if to the Company shall be delivered or
sent by mail or facsimile transmission to the address of the Company set forth in the
23
Registration Statement, Attention: Secretary; provided, however, that any notice to an
Underwriter pursuant to Section 9(c) hereof shall be delivered or sent by mail or facsimile
transmission to such Underwriter at its address set forth in its Underwriters’ Questionnaire, or
communication constituting such Questionnaire, or otherwise furnished to the Representatives, which
address will be supplied to the Company by the Representatives upon request. Any such statements,
requests, notices or agreements shall take effect upon receipt thereof.
14. This Agreement and each Pricing Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company and, to the extent provided in Sections 9 and 11 hereof,
the officers and directors of the Company and each person who controls the Company or any
Underwriter, and their respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this Agreement or any such
Pricing Agreement. No purchaser of any of the Designated Securities from any Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
15. Time shall be of the essence of each Pricing Agreement. As used herein, unless otherwise
indicated the term “business day” shall mean any day when the Commission’s office in Washington,
D.C. is open for business.
16. This Agreement and each Pricing Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
17. This Agreement and each Pricing Agreement may be executed by any one or more of the
parties hereto and thereto in any number of counterparts, each of which shall be deemed to be an
original, but all such respective counterparts shall together constitute one and the same
instrument.
[Signature page follows]
24
| Very truly yours, Newfield Exploration Company |
||||
| By: | /s/ Xxxxx X. Xxxxxxx | |||
| Name: | Xxxxx X. Xxxxxxx | |||
| Title: | Senior Vice President and Chief Financial Officer | |||
25
ANNEX I
Pricing Agreement
| [Name(s) of Co-Representative(s),] As Representatives of the several Underwriters named in Schedule I hereto, |
[Date] |
[Address]
Ladies and Gentlemen:
Newfield Exploration Company, a Delaware corporation (the “Company”), proposes, subject to the
terms and conditions stated herein and in the Underwriting Agreement, dated March [29], 2006 (the
“Underwriting Agreement”), to issue and sell to the Underwriters named in Schedule I hereto (the
“Underwriters”) the Designated Securities specified in Schedule II hereto (the “Designated
Securities” [consisting of Firm Designated Securities and any Optional Designated Securities the
Underwriters may elect to purchase]). Each of the provisions of the Underwriting Agreement is
incorporated herein by reference in its entirety and shall be deemed to be a part of this Agreement
to the same extent as if such provisions had been set forth in full herein; and each of the
representations and warranties set forth therein shall be deemed to have been made at and as of the
date of this Pricing Agreement, except that each representation and warranty which refers to the
Prospectus or the Time of Sale Prospectus in Section 2 of the Underwriting Agreement shall be
deemed to be a representation or warranty as of the date of the Underwriting Agreement in relation
to the Prospectus or the Time of Sale Prospectus (each as therein defined), and also a
representation and warranty as of the date of this Pricing Agreement in relation to the Prospectus
or the Time of Sale Prospectus, each relating to the Designated Securities which are the subject of
this Pricing Agreement. Each reference to the Representatives herein and in the provisions of the
Underwriting Agreement so incorporated by reference shall be deemed to refer to you. Unless
otherwise defined herein, terms defined in the Underwriting Agreement are used herein as therein
defined. The Representatives designated to act on behalf of the Representatives and on behalf of
each of the Underwriters of the Designated Securities pursuant to Section 13 of the Underwriting
Agreement and the address of the Representatives referred to in such Section 13 are set forth in
Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the Prospectus, as the case may
be, relating to the Designated Securities, in the form heretofore delivered to you is now proposed
to be filed with the Commission.
Subject to the terms and conditions set forth herein and in the Underwriting Agreement
incorporated herein by reference, [(a)] the Company agrees to issue and sell to each of the
Underwriters, and each of the Underwriters agrees, severally and not jointly, to purchase from the
Company, at the time and place and at the purchase price to the Underwriters set forth in Schedule
II hereto, the principal amount of Firm Designated Securities set forth opposite the name of such
Underwriter in Schedule I hereto [and, (b) in the event and to the extent that the
Annex I-1
Underwriters shall exercise the election to purchase Optional Designated Securities, as
provided below, the Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company at the purchase price
to the Underwriters set forth in Schedule II hereto that portion of the principal amount of
Optional Designated Securities as to which such election shall have been exercised].
[The Company hereby grants to each of the Underwriters the right to purchase at their election
up to the principal amount of Optional Designated Securities set forth opposite the name of such
Underwriter in Schedule I hereto on the terms referred to in the paragraph above for the sole
purpose of covering sales of Designated Securities in excess of the principal amount of the Firm
Designated Securities. Any such election to purchase Optional Designated Securities may be
exercised by written notice from the Representatives to the Company given within a period of 30
calendar days after the date of this Pricing Agreement, setting forth the aggregate principal
amount of Optional Designated Securities to be purchased and the date on which such Optional
Designated Securities are to be delivered, as determined by the Representatives, but in no event
earlier than the First Time of Delivery or, unless the Representatives and the Company otherwise
agree in writing, no earlier than two or later than ten business days after the date of such
notice.]
If the foregoing is in accordance with your understanding, please sign and return to us [one
for the Company and one for each of the Representatives plus one for each counsel] counterparts
hereof, and upon acceptance hereof by you, on behalf of each of the Underwriters, this letter and
such acceptance hereof, including the provisions of the Underwriting Agreement incorporated herein
by reference, shall constitute a binding agreement between each of the Underwriters and the
Company. It is understood that your acceptance of this letter on behalf of each of the
Underwriters is or will be pursuant to the authority set forth in a form of Agreement among
Underwriters, the form of which shall be submitted to the Company for examination, upon request,
but without warranty on the part of the Representatives as to the authority of the signers thereof.
[Signature page follows]
Annex I-2
| Very truly yours, Newfield Exploration Company |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
Accepted as of the date hereof:
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxx Xxxxxxx & Co. Incorporated
| By: |
On behalf of each of the Underwriters
Annex I-3
SCHEDULE I
| [Maximum Principal | ||||||||
| Principal Amount of | Amount of Optional | |||||||
| Firm Designated | Designated Securities | |||||||
| Securities | Which May be | |||||||
| Underwriter | to be Purchased | Purchased] | ||||||
[Name(s) of Co-Representative(s)] |
||||||||
[Names of other Underwriters] |
||||||||
Total |
||||||||
Schedule I-1
SCHEDULE II
Title of Designated Securities:
[___%] [Floating Rate] [Zero Coupon] [Notes]
[Debentures] due
[Debentures] due
Aggregate Principal Amount:
Aggregate Principal Amount of Firm Designated Securities: [$]
Maximum Principal Amount of Optional Designated Securities: [$]
Price to Public:
%
of the principal amount of the Designated Securities, plus accrued
interest[, if any,] from
to [and accrued amortization[, if any,] from to ]
Underwriting Discount:
__% of the principal amount of the Designated Securities
Purchase Price by Underwriters:
%
of the principal amount of the Designated Securities, plus accrued
interest[, if any,] from
to [and accrued amortization[, if any,] from to ]
Form of Designated Securities:
| [Definitive form to be made available for checking and packaging at least twenty-four hours prior to the Time of Delivery at the office of [The Depository Trust Company or its designated custodian] [the Representatives]] |
| [Book-entry only form represented by one or more global securities deposited with The Depository Trust Company (“DTC”) or its designated custodian, to be made available for checking by the Representatives at least twenty-four hours prior to the Time of Delivery at the office of DTC.] |
Specified funds for payment of purchase price:
Federal (same day) funds
Time of Delivery:
a.m. (New York City time), , 20
Indenture:
Indenture dated , 20 , between the Company and ,
as Trustee
Schedule II-1
Maturity:
Interest Rate:
[ %] [Zero Coupon] [See Floating Rate Provisions]
Interest Payment Dates:
[_______ and ________] of each year commencing on ________, 20
Redemption Provisions:
| [No provisions for redemption] |
| [The Designated Securities may be redeemed, otherwise than through the sinking fund, in whole or in part at the option of the Company, in the amount of [$ ] or an integral multiple thereof, | ||
| [on or after , at the following redemption prices (expressed in percentages of principal amount). If [redeemed on or before , %, and if] redeemed during the 12-month period beginning , |
| Redemption | ||
Year
|
Price | |
| and thereafter at 100% of their principal amount, together in
each case with accrued interest to the redemption date.] [on any interest payment date falling on or after , , at the election of the Company, at a redemption price equal to the principal amount thereof, plus accrued interest to the date of redemption.]] |
| [Other possible redemption provisions, such as mandatory redemption upon occurrence of certain events or redemption for changes in tax law] |
| [Restriction on refunding] |
Sinking Fund Provisions:
| [No sinking fund provisions] | ||
| [The Designated Securities are entitled to the benefit of a sinking fund to retire [$ ] principal amount of Designated Securities on in each of the years through at 100% of their principal amount plus accrued interest[, together with [cumulative] [noncumulative] redemptions at the option of the Company to retire an additional [$ ] principal amount of Designated Securities in the years through at 100% of their principal amount plus accrued interest.] |
Schedule II-2
[If Designated Securities are extendable debt securities, insert—
Extendable provisions:
| Designated Securities are repayable on , [insert date and years], at the option of the holder, at their principal amount with accrued interest. The initial annual interest rate will be %, and thereafter the annual interest rate will be adjusted on , and to a rate not less than % of the effective annual interest rate on U.S. Treasury obligations with -year maturities as of the [insert date 15 days prior to maturity date] prior to such [insert maturity date].] |
[If Designated Securities are floating rate debt securities, insert—
Floating rate provisions:
| Initial annual interest rate will be % through [and thereafter will be adjusted [monthly] [on each , , and ] [to an annual rate of % above the average rate for -year [month][securities][certificates of deposit] issued by and [insert names of banks].] [and the annual interest rate [thereafter] [from through ] will be the interest yield equivalent of the weekly average per annum market discount rate for -month Treasury bills plus % of Interest Differential (the excess, if any, of (i) the then current weekly average per annum secondary market yield for -month certificates of deposit over (ii) the then current interest yield equivalent of the weekly average per annum market discount rate for -month Treasury bills); [from and thereafter the rate will be the then current interest yield equivalent plus % of Interest Differential].] |
Defeasance provisions:
Closing location for delivery of Designated Securities:
Names and addresses of Representatives:
Representatives:
Address for Notices, etc.:
[Other Terms]:
[Listing of Designated Securities]:
Schedule II-3
[New York Stock Exchange] [None.]
[Blackout Provisions:]
[Describe any blackout provisions applicable to the Designated Securities.]
[Underwriter Provided Information:]
[The only information provided by the Underwriters or Representatives is ___.]
The Time of Sale is [___] PM on [___], 2006.
Time of Sale Prospectus:
|
1 | ) | Prospectus dated • relating to the Securities; | |||
| 2 | ) | The preliminary prospectus supplement dated • relating to the Designated Securities; and | ||||
| 3 | ) | [Identify all free writing prospectuses filed by the Company under Rule 433(d) of the Securities Act, including the final term sheet] or [orally communicated pricing information if a final term sheet is not used] |
Schedule II-4
ANNEX II
Pursuant to Section 7(e) of the Underwriting Agreement, the accountants shall furnish letters
regarding the Company (the “company”), addressed to the Underwriters to the effect that:
(i) They are independent registered public accounting firm with respect to the Company
and its subsidiaries within the meaning of the Securities Act and the applicable published
rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary financial
information and schedules (and, if applicable, financial forecasts and/or pro forma
financial information) examined by them and included or incorporated by reference in the
Registration Statement, the Time of Sale Prospectus or the Prospectus comply as to form in
all material respects with the applicable accounting requirements of the Securities Act or
the Exchange Act, as applicable, and the related published rules and regulations thereunder;
and, if applicable, they have made a review in accordance with standards established by the
American Institute of Certified Public Accountants of the consolidated interim financial
statements, selected financial data, pro forma financial information, financial forecasts
and/or condensed financial statements derived from audited financial statements of the
company for the periods specified in such letter, as indicated in their reports thereon,
copies of which have been [separately] furnished to the representative or representatives of
the Underwriters (the “Representatives”, such term to include an Underwriter or Underwriters
who act without any firm being designated as its or their representatives) [and are attached
thereto];
(iii) They have made a review in accordance with standards established by the American
Institute of Certified Public Accountants of the unaudited condensed consolidated statements
of income, consolidated balance sheets and consolidated statements of cash flows included in
the Prospectus, the Time of Sale Prospectus and/or included in the company’s reports
incorporated by reference into the Prospectus, the Time of Sale Prospectus as indicated in
their reports thereon copies of which [have been separately furnished to the
Representatives] [are attached thereto]; and on the basis of specified procedures including
inquiries of officials of the company who have responsibility for financial and accounting
matters regarding whether the unaudited condensed consolidated financial statements referred
to in paragraph (vi)(A)(i) below comply as to form in all material respects with the
applicable accounting requirements of the Securities Act and the Exchange Act and the
related published rules and regulations, nothing came to their attention that caused them to
believe that the unaudited condensed consolidated financial statements do not comply as to
form in all material respects with the applicable accounting requirements of the Securities
Act and the Exchange Act and the related published rules and regulations;
(iv) The unaudited selected financial information with respect to the consolidated
results of operations and financial position of the company for the five most recent fiscal
years included in the Prospectus, the Time of Sale Prospectus and included or incorporated
by reference in Item 6 of the Company’s Annual Report on Form 10-K
Annex A-1
for the most recent fiscal year agrees with the corresponding amounts (after
restatement where applicable) in the audited consolidated financial statements for such five
fiscal years which were included or incorporated by reference in the company’s Annual
Reports on Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus and the Time of Sale
Prospectus under selected captions with the disclosure requirements of Regulation S-K and on
the basis of limited procedures specified in such letter nothing came to their attention as
a result of the foregoing procedures that caused them to believe that this information does
not conform in all material respects with the disclosure requirements of items 301, 302, 402
and 503(d), respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an examination in accordance
with generally accepted auditing standards, consisting of a reading of the unaudited
financial statements and other information referred to below, a reading of the latest
available interim financial statements of the company and its subsidiaries, inspection of
the minute books of the company and its subsidiaries since the date of the latest audited
financial statements included or incorporated by reference in the Prospectus and the Time of
Sale Prospectus, inquiries of officials of the company and its subsidiaries responsible for
financial and accounting matters and such other inquiries and procedures as may be specified
in such letter, nothing came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of income, consolidated
balance sheets and consolidated statements of cash flows included in the Prospectus
and/or included or incorporated by reference in the company’s reports incorporated
by reference in the Prospectus and the Time of Sale Prospectus do not comply as to
form in all material respects with the applicable accounting requirements of the
Exchange Act and the related published rules and regulations, or (ii) any material
modifications should be made to the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus and the Time of Sale Prospectus or included in the
company’s reports incorporated by reference in the Prospectus and the Time of Sale
Prospectus, for them to be in conformity with generally accepted accounting
principles;
(B) any other unaudited income statement data and balance sheet items included
in the Prospectus and the Time of Sale Prospectus do not agree with the
corresponding items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and items were not
determined on a basis substantially consistent with the basis for the corresponding
amounts in the audited consolidated financial statements included or incorporated by
reference in the company’s Annual Report on Form 10-K for the most recent fiscal
year;
(C) the unaudited financial statements which were not included in the
Prospectus but from which were derived the unaudited condensed financial
Annex A-2
statements referred to in clause (A) and any unaudited income statement data
and balance sheet items included in the Prospectus and the Time of Sale Prospectus
and referred to in clause (B) were not determined on a basis substantially
consistent with the basis for the audited financial statements included or
incorporated by reference in the company’s Annual Report on Form 10-K for the most
recent fiscal year;
(D) any unaudited pro forma consolidated condensed financial statements
included or incorporated by reference in the Prospectus and the Time of Sale
Prospectus do not comply as to form in all material respects with the applicable
accounting requirements of the Securities Act and the published rules and
regulations thereunder or the pro forma adjustments have not been properly applied
to the historical amounts in the compilation of those statements;
(E) as of a specified date not more than five days prior to the date of such
letter, there have been any changes in the consolidated capital stock (other than
issuances of capital stock upon exercise of options and stock appreciation rights,
upon earn-outs of performance shares and upon conversions of convertible securities,
in each case which were outstanding on the date of the latest balance sheet included
or incorporated by reference in the Prospectus and the Time of Sale Prospectus) or
any increase in the consolidated long-term debt of the company and its subsidiaries,
or any decreases in consolidated net current assets or stockholders’ equity or other
items specified by the Representatives, or any increases in any items specified by
the Representatives, in each case as compared with amounts shown in the latest
balance sheet included or incorporated by reference in the Prospectus and the Time
of Sale Prospectus, except in each case for changes, increases or decreases which
the Prospectus and the Time of Sale Prospectus discloses have occurred or may occur
or which are described in such letter; and
(F) for the period from the date of the latest financial statements included or
incorporated by reference in the Prospectus and the Time of Sale Prospectus to the
specified date referred to in clause (E) there were any decreases in consolidated
net revenues or income from operations or the total or per share amounts of
consolidated net income or other items specified by the Representatives, or any
increases in any items specified by the Representatives, in each case as compared
with the comparable period of the preceding year and with any other period of
corresponding length specified by the Representatives, except in each case for
increases or decreases which the Prospectus and the Time of Sale Prospectus
discloses have occurred or may occur or which are described in such letter; and
(vii) In addition to the examination referred to in their report(s) included or
incorporated by reference in the Prospectus and the Time of Sale Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures referred to in
paragraphs (iii) and (vi) above, they have carried out certain specified procedures, not
constituting an examination in accordance with generally accepted auditing standards,
Annex A-3
with respect to certain amounts, percentages and financial information specified by the
Representatives which are derived from the general accounting records of the company and its
subsidiaries, which appear in the Prospectus and the Time of Sale Prospectus (excluding
documents incorporated by reference), or in Part II of, or in exhibits and schedules to, the
Registration Statement specified by the Representatives or in documents incorporated by
reference in the Prospectus and the Time of Sale Prospectus specified by the
Representatives, and have compared certain of such amounts, percentages and financial
information with the accounting records of the company and its subsidiaries and have found
them to be in agreement.
All references in this Annex II to the Prospectus and the Time of Sale Prospectus shall be
deemed to refer to the Prospectus and the Time of Sale Prospectus (including the documents
incorporated by reference therein) as defined in the Underwriting Agreement as of the date of the
letter delivered on the date of the Pricing Agreement for purposes of such letter and to the
Prospectus and the Time of Sale Prospectus (including the documents incorporated by reference
therein) in relation to the applicable Designated Securities for purposes of the letter delivered
at the Time of Delivery for such Designated Securities.
Annex A-4
