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EXHIBIT 1.2
PRICING AGREEMENT
August 9, 1999
Xxxxxxx, Xxxxx & Co.
Donaldson, Lufkin, & Xxxxxxxx
Securities Corporation
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx,
Incorporated
Xxxx Xxxxxxxx Xxxxxxx, a division of
Xxxx Xxxxxxxx Incorporated
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Newfield Financial Trust I, a statutory business trust formed under the
laws of the State of Delaware (the "Designated Trust"), and Newfield Exploration
Company, a Delaware corporation (the "Company"), propose, subject to the terms
and conditions stated herein and in the Underwriting Agreement dated August 1,
1999 (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). The principal asset of the Designated Trust will consist of debt
securities of the Company (the "Subordinated Debentures"), as specified in
Schedule II to this Agreement. The Designated Securities will be guaranteed by
the Company to the extent set forth in this Agreement with respect to such
Designated Securities (the "Guarantee"). The Subordinated Debentures will be
convertible into shares of Common Stock, par value $.01 per share, of the
Company (the "Stock"). 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 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 (as therein defined), and also a representation and
warranty as of the date of this Pricing Agreement in relation to the Prospectus
as amended or supplemented 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 12
of the Underwriting Agreement and the address of the Representatives referred to
in such Section 12 are set forth in Schedule II hereto.
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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 Designated
Trust agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Designated
Trust, at the time and place and at the purchase price to the Underwriters set
forth in Schedule II hereto, the number of Firm Designated Securities set forth
opposite the name of such Underwriter in Schedule I hereto, (b) in the event and
to the extent that the Underwriters shall exercise the election to purchase
Optional Designated Securities, as provided below, the Designated Trust agrees
to issue and sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Designated Trust at the
purchase price to the Underwriters set forth in Schedule II hereto that portion
of the number of Optional Designated Securities as to which such election shall
have been exercised and (c) the Company agrees to issue the Subordinated
Debentures and the Guarantee and to purchase the Common Securities.
The Designated Trust hereby grants to each of the Underwriters the
right to purchase at their election up to the number 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 number of the Firm Designated
Securities. Any such election to purchase Optional Designated Securities may be
exercised by written notice from the Representatives to the Designated Trust and
the Company given within a period of 30 calendar days after the date of this
Pricing Agreement, setting forth the aggregate number 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 Designated Trust otherwise agree in writing, no earlier than two or later
than ten business days after the date of such notice.
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If the foregoing is in accordance with your understanding, please sign
and return to us six 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 Designated Trust 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 Designated Trust and the Company for
examination, upon request, but without warranty on the part of the
Representatives as to the authority of the signers thereof.
Very truly yours,
Newfield Exploration Company
By: /s/ XXXXX XXXXXXX
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Xxxxx Xxxxxxx
Vice President - Planning and
Administration
Newfield Financial Trust I
By: Newfield Exploration Company,
as Depositor
By: /s/ XXXXX XXXXXXX
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Xxxxx Xxxxxxx
Vice President - Planning and
Administration
Accepted as of the date hereof:
Xxxxxxx, Xxxxx & Co.
/s/ XXXXXXX, SACHS & CO.
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On behalf of each of the Underwriters
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SCHEDULE I
NUMBER OF MAXIMUM NUMBER
FIRM OF OPTIONAL
DESIGNATED DESIGNATED
SECURITIES SECURITIES WHICH
TO BE MAY BE
UNDERWRITER PURCHASED PURCHASED
----------- ---------- ----------------
Xxxxxxx, Xxxxx & Co........................................... 1,250,000 187,500
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation........... 500,000 75,000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated...................................... 500,000 75,000
Xxxx Xxxxxxxx Xxxxxxx, a division of Xxxx Xxxxxxxx
Incorporated............................... 250,000 37,500
--------- -------
TOTAL 2,500,000 375,000
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SCHEDULE II
TITLE OF DESIGNATED SECURITIES:
6 1/2% Cumulative Quarterly Income Convertible Preferred Securities, Series A
NUMBER OF DESIGNATED SECURITIES:
Number of Firm Designated Securities: 2,500,000
Maximum Number of Optional Designated Securities: 375,000
INITIAL OFFERING PRICE TO PUBLIC:
$50.00 per Security
PURCHASE PRICE BY UNDERWRITERS:
$50.00 per Security
COMMISSION PAYABLE TO UNDERWRITERS:
As compensation to the Underwriters for their commitments hereunder, and in view
of the fact that the proceeds of the sale of the Designated Securities will be
used by the Designated Trust to purchase the Subordinated Debentures of the
Company, the Company hereby agrees to pay at each Time of Delivery to the
Designated Representative, for the accounts of the several Underwriters, an
amount equal to $1.50 per Security for the Designated Securities to be delivered
at such Time of Delivery in Federal (same-day) funds.
LIQUIDATION AMOUNT:
$50 per Designated Security
DISTRIBUTION RATE:
6 1/2%
CONVERSION:
Each Security is convertible into 1.3646 shares of Stock
DISTRIBUTION PAYMENT DATES:
February 15, May 15, August 15 and November 15 of each year, commencing on
November 15, 1999
DISTRIBUTION DEFERRAL PERIOD:
20 quarters
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REDEMPTION PROVISIONS:
The redemption provisions set forth in Sections 4.2 and 4.4 of the Trust
Agreement shall apply to the Designated Securities
SINKING FUND PROVISIONS:
No sinking fund provisions
EXCHANGE FOR DESIGNATED SECURITIES:
The Subordinated Debentures may be delivered in exchange for the Designated
Securities as provided in the Prospectus Supplement
FORM OF DESIGNATED SECURITIES:
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
TRUST AGREEMENT:
Amended and Restated Trust Agreement dated as of August 13, 1999, between the
Company, as Depositor, First Union National Bank, as Property Trustee, First
Union Trust Company, NA, as Delaware Trustee, and the several Holders of Trust
Securities
INDENTURE:
Indenture dated as of August 13, 1999, between the Company and First Union
National Bank, as Indenture Trustee (the "Indenture")
GUARANTEE:
Guarantee Agreement dated as of August 13, 1999, between Company and First Union
National Bank, as Guarantee Trustee
SUBORDINATED DEBENTURES:
Title:
6 1/2% Junior Subordinated Convertible Debentures, Series A
Maturity:
August 15, 2029 (subject to shortening such maturity to a date not earlier than
August 13, 2014)
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Interest Rate:
6 1/2%
Interest Payment Dates:
February 15, May 15, August 15 and November 15 of each year, commencing on
November 15, 1999
Extension Period:
20 quarters
LISTING OF DESIGNATED SECURITIES:
New York Stock Exchange.
BLACKOUT PROVISIONS:
The Company and the Designated Trust agree, and the Company's officers and
directors will agree (and delivery of written agreements to such effect shall be
a condition to the obligations of the Underwriters), that for a period of 90
days from the date of this Pricing Agreement, they will not, without the prior
written consent of Xxxxxxx, Sachs & Co., sell, offer to sell, grant any option
for the sale of or otherwise dispose of any Securities, any security convertible
into or exchangeable into or exercisable for the Securities or the Subordinated
Debentures or any debt substantially similar to the Subordinated Debentures or
any equity securities substantially similar to the Securities, any Stock or any
security convertible into or exchangeable into or exercisable for Stock or any
equity security substantially similar to the Stock, except for (i) issuances
pursuant to the exercise of warrants, stock options and convertible securities
outstanding on the date hereof and (ii) grants of options or shares of Stock
pursuant to existing employee benefit plans.
TIME OF DELIVERY:
10:00 a.m. (New York City time), on August 13, 1999
CLOSING LOCATION:
Xxxxx & Xxxxx, L.L.P.
3000 One Shell Plaza
000 Xxxxxxxxx
Xxxxxxx, Xxxxx
NAME AND ADDRESS OF REPRESENTATIVES:
Designated Representatives: Xxxxxxx, Sachs & Co.
Address for Notices, etc.: 00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
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