Filed pursuant to Rule 424(b)(2)
Registration No. 333-61600
333-61600-01
333-61600-02
333-61600-03
PROSPECTUS SUPPLEMENT
(To Prospectus Dated June 27, 2001)
[BURLINGTON RESOURCES LOGO]
BURLINGTON RESOURCES FINANCE COMPANY
$350,000,000
5.700% NOTES DUE 2007
FULLY AND UNCONDITIONALLY GUARANTEED BY
BURLINGTON RESOURCES INC.
Interest payable March 1 and September 1.
Issue Price: 99.805%.
The notes will mature on March 1, 2007. The notes are fully and unconditionally
guaranteed by Burlington Resources Inc.
Burlington Resources Finance Company may redeem all or a portion of the notes at
any time at a price based on a formula set forth in this prospectus supplement.
The notes will be senior obligations of Burlington Resources Finance Company and
will rank equally with all of Burlington Resources Finance Company's other
unsecured senior indebtedness. The guarantee of the notes will be a senior
obligation of Burlington Resources Inc. and will rank equally with all of
Burlington Resources Inc.'s other unsecured senior indebtedness.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<Table>
<Caption>
- ------------------------------------------------------------------------------------------------------
PROCEEDS TO BURLINGTON
DISCOUNTS AND RESOURCES FINANCE
PRICE TO PUBLIC COMMISSIONS COMPANY
- ------------------------------------------------------------------------------------------------------
Per note 99.805% 0.600% 99.205%
- ------------------------------------------------------------------------------------------------------
Total $349,317,500 $2,100,000 $347,217,500
- ------------------------------------------------------------------------------------------------------
</Table>
The notes will not be listed on any national securities exchange. Currently,
there is no public market for the notes.
It is expected that delivery of the notes will be made to investors through the
book-entry delivery system of The Depository Trust Company on or about February
25, 2002.
JPMORGAN
BANC OF AMERICA SECURITIES LLC
FLEET SECURITIES, INC.
SALOMON SMITH BARNEY
TD SECURITIES
February 20, 2002
This document is in two parts. The first part is this prospectus
supplement, which describes the terms of the notes that Burlington Resources
Finance Company is currently offering. The second part is the accompanying
prospectus, which gives more general information, some of which may not apply to
the notes that Burlington Resources Finance Company is currently offering.
Generally, the term "prospectus" refers to both parts combined.
If the information varies between this prospectus supplement and the
accompanying prospectus, the information in this prospectus supplement
supersedes the accompanying prospectus.
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS. NO
PERSON IS AUTHORIZED TO PROVIDE YOU WITH DIFFERENT INFORMATION OR TO OFFER THE
NOTES IN ANY STATE WHERE THE OFFER IS NOT PERMITTED. YOU SHOULD NOT ASSUME THAT
THE INFORMATION PROVIDED BY THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING
PROSPECTUS IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE HEREOF OR THEREOF. IN
THIS PROSPECTUS SUPPLEMENT, REFERENCES TO "BURLINGTON RESOURCES" MEAN BURLINGTON
RESOURCES INC., THE GUARANTOR OF THE NOTES, NOT BURLINGTON RESOURCES FINANCE
COMPANY, THE ISSUER OF THE NOTES. UNLESS OTHERWISE STATED, THE DOLLAR AMOUNTS
AND FINANCIAL DATA CONTAINED IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING
PROSPECTUS ARE PRESENTED IN U.S. DOLLARS.
TABLE OF CONTENTS
<Table>
<Caption>
PAGE
PROSPECTUS SUPPLEMENT
Burlington Resources................... S-1
Burlington Resources Finance Company... S-1
Use of Proceeds........................ S-1
Capitalization......................... S-2
Selected Financial Data................ S-3
Description of Notes and Guarantees.... S-4
Certain Tax Considerations............. S-6
Underwriting........................... S-12
Legal Matters.......................... S-13
Experts................................ S-13
</Table>
<Table>
<Caption>
PAGE
PROSPECTUS
Where You Can Find More Information.... 2
Incorporation of Certain Documents by
Reference............................ 3
Forward-Looking Statements............. 4
Burlington Resources................... 4
The Burlington Resources Trusts........ 5
Burlington Resources Finance Company... 6
Use of Proceeds........................ 6
Ratio of Earnings to Fixed Charges..... 6
Description of Debt Securities......... 6
Description of Capital Stock of
Burlington Resources................. 19
Description of Trust Preferred
Securities and Trust Guarantees...... 24
Plan of Distribution................... 27
Legal Matters.......................... 28
Experts................................ 28
</Table>
i
BURLINGTON RESOURCES
Burlington Resources is a holding company engaged, through its principal
subsidiaries, Burlington Resources Oil & Gas Company LP, The Louisiana Land and
Exploration Company, Burlington Resources Canada Ltd. and Canadian Hunter
Exploration Ltd., in the exploration, development, production and marketing of
crude oil and natural gas. Burlington Resources is one of the world's largest
independent oil and gas companies, with natural gas comprising the majority of
its reserves. Burlington Resources has properties in the United States, Canada,
the United Kingdom, South America, Africa and China.
Burlington Resources' principal executive offices are located at 5051
Westheimer, Suite 1400, Houston, Texas 77056, telephone: (713) 624-9500.
BURLINGTON RESOURCES FINANCE COMPANY
Burlington Resources Finance Company is an unlimited liability company
organized in February 2000 under the laws of Nova Scotia, Canada. Burlington
Resources Finance Company is a direct wholly-owned subsidiary of Burlington
Resources.
Burlington Resources Finance Company's principal place of business is c/o
Burlington Resources Canada Ltd., Suite 3700, 250 6th Avenue, S.W., Calgary,
Alberta T2P 3H7, telephone: (403) 260-8000.
USE OF PROCEEDS
Burlington Resources Finance Company intends to use the net proceeds from
the sale of the notes, which is estimated to be $347,217,500 to transfer,
directly or indirectly, funds to Burlington Resources to repay indebtedness in
the form of commercial paper incurred in connection with the acquisition of
Canadian properties by Burlington Resources Canada Ltd. from ATCO Gas and
Pipelines Ltd.
As of February 15, 2002, approximately $346 million of commercial paper,
incurred in connection with the asset acquisition from ATCO Gas and Pipelines
Ltd., was outstanding at a weighted average interest rate of approximately
2.36%.
S-1
CAPITALIZATION
The following table sets forth Burlington Resources' consolidated
capitalization as of December 31, 2001, and as adjusted to reflect the issuance
of the notes and the use of the gross proceeds of the notes to repay
indebtedness. This table should be read in conjunction with the consolidated
financial statements and the notes thereto incorporated by reference in this
prospectus supplement.
<Table>
<Caption>
- -----------------------------------------------------------------------------------
DECEMBER 31, 2001(a)
---------------------
AS
ACTUAL ADJUSTED
- -----------------------------------------------------------------------------------
(IN MILLIONS)
Long-Term Debt.............................................. $ 4,337 $ 4,687
------- -------
Stockholders' Equity(b):
Preferred Stock, Par Value $.01 per Share (Authorized
75,000,000 Shares, One Share Issued)................... - -
Common Stock, Par Value $.01 per Share (Authorized
325,000,000 Shares; Issued 241,188,688 Shares at December
31, 2001)................................................ 2 2
Paid-in Capital............................................. 3,944 3,944
Retained Earnings........................................... 1,332 1,332
Cost of Treasury Stock (40,395,695 Shares at December 31,
2001)..................................................... (1,638) (1,638)
Deferred Compensation -- Restricted Stock................... (9) (9)
Accumulated Other Comprehensive Loss........................ (106) (106)
Total Stockholders' Equity........................ 3,525 3,525
------- -------
Total Capitalization.............................. $ 7,862 $ 8,212
======= =======
</Table>
(a) The commercial paper being repaid with the proceeds of this offering was
incurred in January 2002 in connection with the acquisition of properties
from ATCO Gas and Pipelines Ltd. Such indebtedness is not reflected in the
"Actual" or "As Adjusted" columns of this table.
(b) Burlington Resources has authority to issue 75,000,000 shares of $.01 par
value preferred stock, of which 3,250,000 have been designated as Series A
Junior Participating Preferred Stock.
S-2
SELECTED FINANCIAL DATA
The selected financial data set forth below for the periods indicated
should be read in conjunction with the consolidated financial statements and the
notes thereto contained in documents incorporated by reference in this
prospectus.
<Table>
<Caption>
YEAR ENDED DECEMBER 31,
---------------------------------------------
2001 2000 1999 1998 1997
- -------------------------------------------------------------------------------------------
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
INCOME STATEMENT DATA:
Revenues.................................. $3,326 $3,147 $2,313 $2,225 $2,575
Operating Income (Loss)................... 1,085 1,191 200 (439) 605
Net Income (Loss)......................... 561 675 (10) (338) 352
Earnings (Loss) per Common Share:
Basic............................... 2.71 3.13 (.05) (1.60) 1.69
Diluted............................. $ 2.70 $ 3.12 $ (.05) $(1.60) $ 1.67
Ratio of Earnings to Fixed Charges(a)..... 5.66x 5.72x .94x - 3.36x
- -------------------------------------------------------------------------------------------
</Table>
<Table>
<Caption>
- -------------------------------------------------------------------------------------------
AS OF DECEMBER 31,
-------------------------------------------
2001 2000 1999 1998 1997
- -------------------------------------------------------------------------------------------
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
BALANCE SHEET DATA:
Total Assets.................................. $10,582 $7,506 $7,165 $7,060 $7,164
Long-Term Debt................................ 4,337 2,301 2,769 2,684 2,317
Stockholders' Equity.......................... 3,525 3,750 3,229 3,312 3,561
Cash Dividends Declared per Common Share(b)... $ .55 $ .55 $ .46 $ .46 $ .39
- -------------------------------------------------------------------------------------------
</Table>
(a) Total earnings available for fixed charges in 1998 were inadequate to cover
total fixed charges in the amount of approximately $638 million primarily as
a result of the impairment of oil and gas assets related to the adoption of
Statement of Financial Accounting Standard No. 121 ($706 million pretax or
$390 million after tax in 1998).
For purposes of calculating the ratio of earnings to fixed charges, earnings
represent pretax income from continuing operations available for fixed
charges, less equity in undistributed earnings of 20-50% owned companies,
together with a portion of rent under long-term operating leases
representative of an interest factor. Fixed charges represent interest
expense, capitalized interest and a portion of rent under long-term
operating leases representative of an interest factor.
(b) Cash dividends declared per common share were calculated based upon
historical cash dividends paid by Burlington Resources, The Louisiana Land
and Exploration Company ("LL&E") and Poco Petroleums Ltd. ("Poco") divided
by outstanding shares for years 1996 through 1999. This calculation resulted
from the 1997 merger with LL&E and the 1999 merger with Poco that were
accounted for as a pooling of interests. Beginning in 2000, cash dividends
declared per common share were based on Burlington Resources' annual
dividend rate of $.55 per common share.
S-3
DESCRIPTION OF NOTES AND GUARANTEES
Burlington Resources Finance Company will issue the notes under the
indenture governing senior debt securities of Burlington Resources Finance
Company referred to in the accompanying prospectus. The notes will be issued in
the form of one or more global notes registered in the name of The Depository
Trust Company or its nominee, as described under "Description of Debt
Securities--Book-Entry Debt Securities--Registration, Transfer, Exchange and
Payment" in the accompanying prospectus. The following description and the
description in the accompanying prospectus is a summary of the material
provisions of the notes, the indenture and the guarantee agreement. These
descriptions do not restate the indenture or the guarantee agreement in their
entirety. Burlington Resources and Burlington Resources Finance Company urge you
to read the indenture and the guarantee agreement because they, and not this
description, define your rights as holders of the notes. Burlington Resources
and Burlington Resources Finance Company have filed a copy of the indenture and
the guarantee agreement as exhibits to the registration statement, which
includes the accompanying prospectus.
This description of the notes and the guarantee in this prospectus
supplement replace the description of the general provisions of the notes, the
guarantee, the indenture and the guarantee agreement in the accompanying
prospectus to the extent that it is inconsistent with the accompanying
prospectus. The notes are "debt securities" as that term is used in the
accompanying prospectus.
With certain exceptions and pursuant to certain requirements set forth in
the indenture, Burlington Resources Finance Company may discharge its
obligations under the indenture with respect to the notes as described under
"Description of Debt Securities--Defeasance" in the accompanying prospectus.
PRINCIPAL, MATURITY AND INTEREST
The notes will be senior unsecured obligations of Burlington Resources
Finance Company. Burlington Resources will irrevocably and unconditionally
guarantee the notes as to principal, premium, if any, interest and additional
amounts, if any.
The notes will mature on March 1, 2007. Interest on the notes will accrue
at the rate of 5.700% per year and will be payable semi-annually in arrears on
March 1 and September 1 of each year, commencing on September 1, 2002.
Burlington Resources Finance Company will make each interest payment to the
person in whose name the notes are registered at the close of business on the
immediately preceding February 15 or August 15, as the case may be, whether or
not that date is a business day.
Interest on the notes will accrue from February 25, 2002 and will be
computed on the basis of a 360-day year comprised of twelve 30-day months.
If any interest payment date, maturity date or redemption date falls on a
day that is not a business day, the payment will be made on the next business
day and, unless Burlington Resources Finance Company defaults on the payment, no
interest will accrue for the period from and after the interest payment date,
maturity date or redemption date.
OPTIONAL REDEMPTION
Burlington Resources Finance Company may redeem all or a portion of the
notes at any time as set forth below. Burlington Resources Finance Company will
mail notice to registered
S-4
holders of the notes of its intent to redeem not less than 30 nor more than 60
days prior to the redemption date. Burlington Resources Finance Company may
redeem the notes at a redemption price applicable to the notes equal to the
greater of:
- 100% of the principal amount of the notes plus accrued interest to the
redemption date; or
- the sum of the present values of the remaining scheduled payments of
principal and interest (exclusive of the interest accrued to the date
of redemption) discounted to the redemption date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at the
Treasury Rate plus 25 basis points, plus accrued interest on the
principal amount of the notes being redeemed to the redemption date.
"Treasury Rate" means, with respect to any redemption date, (i) the yield,
under the heading which represents the average for the immediately preceding
week, appearing in the most recently published statistical release designated
"H.15(519)" or any successor publication which is published weekly by the Board
of Governors of the Federal Reserve System and which establishes yields on
actively traded United States Treasury securities adjusted to constant maturity
under the caption "Treasury Constant Maturities," for the maturity corresponding
to the Comparable Treasury Issue (if no maturity is within three months before
or after the Remaining Life, yields for the two published maturities most
closely corresponding to the Comparable Treasury Issue shall be determined and
the Treasury Rate shall be interpolated or extrapolated from such yields on a
straight line basis, rounding to the nearest month) or (ii) if such release (or
any successor release) is not published during the week preceding the
calculation date or does not contain such yields, the rate per annum equal to
the semiannual equivalent yield to maturity of the Comparable Treasury Issue,
calculated using a price for the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable Treasury Price for
such redemption date. The Treasury Rate shall be calculated on the third
Business Day preceding the redemption date.
"Business Day" means any day that is not a Saturday, Sunday or legal
holiday in New York, New York and on which commercial banks are open for
business in New York, New York.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity comparable to
the remaining term ("Remaining Life") of the notes to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of the applicable series of notes.
"Comparable Treasury Price" means, with respect to any redemption date, (A)
the average of four Reference Treasury Dealer Quotations for such redemption
date, after excluding the highest and lowest such Reference Treasury Dealer
Quotations, or (B) if the Independent Investment Banker obtains fewer than four
such Reference Treasury Dealer Quotations, the average of all such Quotations.
"Independent Investment Banker" means J.P. Morgan Securities Inc. or, if
such firm is unwilling or unable to select the Comparable Treasury Issue, an
independent investment banking institution of national standing appointed by the
Trustee.
S-5
"Reference Treasury Dealer" means (i) each of J.P. Morgan Securities Inc.
and three other primary U.S. Government securities dealers in New York City
(each, a "Primary Treasury Dealer") and their respective successors, provided,
however, that if any of the foregoing shall cease to be a Primary Treasury
Dealer, we will substitute therefor another Primary Treasury Dealer and (ii) any
other Primary Treasury Dealer selected by us.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any redemption date, the average, as determined by
the Independent Investment Banker, of the bid and asked prices for the
comparable Treasury Issue (expressed in each case as a percentage of its
principal amount) quoted in writing to the Independent Investment Banker by such
Reference Treasury Dealer at 5:00 p.m. on the third Business Day preceding such
redemption date.
CERTAIN TAX CONSIDERATIONS
UNITED STATES FEDERAL TAX CONSIDERATIONS
In the opinion of White & Case LLP, New York, special United States tax
counsel to Burlington Resources and Burlington Resources Finance Company, the
following section describes certain anticipated United States federal income and
estate tax consequences relating to the ownership and disposition of the notes.
This description is based on the Internal Revenue Code of 1986, as amended;
existing administrative pronouncements and judicial decisions; and existing and
proposed Treasury regulations, each as available and in effect on the date of
this prospectus supplement. Changes to any of the foregoing after the date of
this prospectus supplement may affect the tax consequences described below,
possibly with retroactive effect.
This description provides general information only and is directed solely
to original holders purchasing notes at the issue price. The issue price is the
first price to the public at which a substantial amount of the notes are sold,
excluding sales to bond houses, brokers or similar persons or organizations
acting in the capacity of underwriters, placement agents or wholesalers.
This description discusses only notes held as capital assets. This
description does not discuss all of the tax consequences that may be relevant to
a holder in light of his particular circumstances. This description also does
not discuss all of the tax consequences that may be relevant to holders subject
to special rules, such as (1) certain financial institutions, (2) real estate
investment trusts, (3) regulated investment companies, (4) grantor trusts, (5)
insurance companies, (6) dealers or traders in securities or currencies, (7)
persons holding notes in connection with a hedging transaction, straddle,
conversion transaction or other integrated transaction or (8) persons who have
ceased to be United States citizens or to be taxed as resident aliens. Moreover,
except as set forth below, this description does not address the United States
federal estate and gift tax consequences of United States Holders, as defined
below, any applicable foreign, state or local tax laws, or the alternative
minimum tax consequences of the acquisition, ownership or retirement of notes.
IF YOU ARE CONSIDERING THE PURCHASE OF NOTES, YOU SHOULD CONSULT YOUR TAX
ADVISOR WITH REGARD TO THE APPLICATION OF THE UNITED STATES FEDERAL INCOME AND
ESTATE TAX LAWS TO YOUR PARTICULAR SITUATION, AS WELL AS ANY TAX CONSEQUENCES
ARISING UNDER THE LAWS OF ANY STATE, LOCAL OR FOREIGN TAXING JURISDICTION.
S-6
UNITED STATES HOLDERS
For purposes of this discussion, a United States Holder means a beneficial
owner of a note that is for United States federal income tax purposes:
- a citizen or resident of the United States;
- a corporation, other entity taxable as a corporation for United States
federal income tax purposes, or a partnership created in or organized
under the laws of the United States, any state thereof or the District
of Columbia;
- an estate the income of which is subject to United States federal
income taxation regardless of its source;
- a trust if it has validly elected to be treated as a United States
person for United States federal income tax purposes or if (1) a court
within the United States is able to exercise primary supervision over
its administration and (2) one or more United States persons have the
authority to control all of its substantial decisions; or
- a person otherwise subject to United States federal income taxation on
a net income basis in respect of a note.
If a partnership holds a note, the tax treatment of a partner generally
will depend upon the status of the partner and upon the activities of the
partnership. If you are a partner of a partnership holding our notes, you should
consult your tax advisor.
A Non-United States Holder is a beneficial owner of a note that is not a
United States Holder.
Interest on Notes
If you are a United States Holder, interest on a note generally will be
taxable to you as ordinary interest income at the time it is accrued or is
received in accordance with your usual method of accounting for tax purposes.
If Canadian withholding taxes are imposed on payments on the notes, the
eligibility of a United States Holder for a United States foreign tax credit
with respect to such taxes may be limited because, for United States foreign tax
credit purposes, interest paid under the notes would constitute income from
sources within the United States. Moreover, if such Canadian withholding taxes
are imposed on interest payments under the notes at a rate that equals or
exceeds 5%, such interest income would constitute "high withholding tax
interest" for United States foreign tax credit purposes. Alternatively, a United
States Holder may be entitled to a deduction for United States federal income
tax purposes with respect to any such Canadian withholding taxes. The
calculation of foreign tax credits or deductions involves the application of
complex rules that depend on a United States Holder's particular circumstances.
Accordingly, you are urged to consult your tax advisor regarding the
creditability or deductibility of such taxes.
Sale, Exchange or Retirement of the Notes
If you are a United States Holder and you sell or exchange your note or it
is retired, you will recognize taxable gain or loss equal to the difference
between the amount realized on the sale, exchange or retirement and your
adjusted tax basis in the note. For these purposes, the amount realized does not
include any amount attributable to accrued but unpaid interest on
S-7
the notes. Amounts attributable to accrued but unpaid interest will be treated
as interest as described under "Interest on Notes" above. If you are a United
States Holder, your adjusted tax basis in a note generally will equal the cost
of the note to you.
In general, gain or loss realized on the sale, exchange or retirement of a
note will be capital gain or loss. If you are a non-corporate United States
Holder, the maximum marginal United States federal income tax rate applicable to
the gain generally will be lower than the maximum marginal United States federal
income tax rate applicable to ordinary income if your holding period for the
notes exceeds one year. You should consult your tax advisor regarding the
treatment of capital losses, the deductibility of which is subject to
limitations.
NON-UNITED STATES HOLDERS
Interest on Notes
Subject to the discussion under "Backup Withholding Tax and Information
Reporting" below, if you are a Non-United States Holder, but are not:
- a controlled foreign corporation related to Burlington Resources
Finance Company or Burlington Resources by stock ownership;
- a shareholder owning actually or constructively 10% or more of the
total combined voting power of all classes of stock of Burlington
Resources Finance Company or Burlington Resources entitled to vote; or
- a bank which acquired notes in consideration of an extension of credit
made pursuant to a loan agreement entered into in the ordinary course
of business
and receive an interest payment from Burlington Resources Finance Company, you
generally will not be subject to United States federal income or withholding tax
provided that: (1) the interest is not effectively connected with your conduct
of a trade or business within the United States and (2) you provide valid
certifications meeting the requirements of the Internal Revenue Code or
otherwise qualify for an exemption.
If you are engaged in a trade or business in the United States and interest
on the note is effectively connected with the conduct of such trade or business,
you will be subject to United States federal income tax on the interest on a net
income basis in the same manner as if you were a United States Holder. In
addition, a Non-United States Holder that is a foreign corporation may also be
subject to a branch profits tax equal to 30%, or a lower applicable treaty rate,
of its earnings and profits effectively connected with its United States trade
or business, including any premium and interest on a note, for the taxable year,
subject to adjustments.
Sale, Exchange or Retirement of the Notes
If you are a Non-United States Holder, you generally will not be subject to
United States federal income tax on any gain recognized on a sale, exchange or
retirement of a note unless (1) such gain is effectively connected with your
conduct of a trade or business within the United States or (2) you are an
individual that is present in the United States for 183 or more days in the
taxable year of disposition and certain other requirements are met.
A Non-United States Holder that is a foreign corporation may also be
subject to a branch profits tax equal to 30%, or a lower applicable treaty rate,
of its earnings and profits
S-8
effectively connected with its United States trade or business, including any
gain recognized on a sale, exchange or retirement of a note, for the taxable
year, subject to adjustments.
Federal Estate Taxes
A note that is held by an individual who at the time of death is not a
citizen or resident of the United States will not be subject to United States
federal estate tax as a result of such individual's death, provided that such
individual is not a shareholder owning actually or constructively 10% or more of
the total combined voting power of all classes of stock of Burlington Resources
Finance Company or Burlington Resources entitled to vote and, at the time of the
individual's death, payments of interest with respect to such notes would not
have been effectively connected with the conduct by such individual of a trade
or business in the United States.
BACKUP WITHHOLDING TAX AND INFORMATION REPORTING
A backup withholding tax (currently at a rate of 30%) and information
reporting requirements apply in the case of certain non-corporate United States
persons to certain payments of principal of, and interest on, an obligation, and
of proceeds of the sale of an obligation before maturity. If you are a United
States person that is not a corporation or other "exempt recipient," backup
withholding will apply to you if you:
- fail to furnish your Taxpayer Identification Number ("TIN") which in
the case of an individual is your Social Security Number,
- furnish an incorrect TIN,
- are notified by the Internal Revenue Service that you have failed to
properly report payments of interest or dividends, or
- under certain circumstances, fail to certify, under penalty of perjury,
that you furnished a correct TIN and have not been notified by the
Internal Revenue Service that you are subject to backup withholding.
The backup withholding tax rate of 30% will be reduced to 29% for years
2004 and 2005 and 28% for years 2006 through 2010.
Under current Treasury regulations, if you are not a United States person,
backup withholding will not apply to payments on notes that we or any paying
agent make outside the United States, provided that you have provided valid
certifications of your foreign status meeting the requirements of the Internal
Revenue Code or otherwise qualify for exemption and neither we nor the paying
agent has actual knowledge or a reason to know that you are a United States
person for purposes of such backup withholding tax requirements.
If provided by a beneficial owner, the certification must give the name and
address of such owner, state that such owner is not a United States person, or,
in the case of an individual, that such person is neither a citizen or resident
of the United States, and must be signed by the owner under penalties of
perjury. If provided by a financial institution, other than a financial
institution that is a qualified intermediary, the certification must state that
the financial institution has received from the beneficial owner the certificate
set forth in the preceding sentence, set forth the information contained in such
certificate (and include a copy of such certificate), and be signed by an
authorized representative of the financial institution under penalties of
perjury. Generally, the furnishing of the names of the beneficial owners of
S-9
the notes that are not United States persons and a copy of such beneficial
owner's certificate by a financial institution will not be required where the
financial institution is a qualified intermediary which has entered into a
withholding agreement with the Internal Revenue Service pursuant to the Treasury
regulations.
In the case of payments to a foreign partnership, a foreign simple trust,
or a foreign grantor trust, other than payments to a foreign partnership, a
foreign simple trust, or a foreign grant trust that qualifies as a withholding
foreign partnership or a withholding foreign trust within the meaning of the
Treasury regulations and payments to a foreign partnership, a foreign simple
trust, or a foreign grantor trust that are effectively connected with the
conduct of a trade or business in the United States, the partners of these
partnerships, the beneficiaries of the foreign simple trust, or the persons
treated as the owners of the foreign grantor trust, as the case may be, will be
required to provide the certification discussed above in order to establish an
exemption from withholding and backup withholding tax requirements.
In addition, if the foreign office of a foreign broker pays the proceeds of
the sale of a note to the seller of the note, backup withholding and information
reporting will not apply, provided that the broker (1) derives less than 50% of
its gross income for certain periods from the conduct of trade of business in
the United States, (2) is not a controlled foreign corporation and (3) is not a
foreign partnership (a) one or more of the partners of which, at any time during
its tax year, is a United States person who, in the aggregate, holds more than
50% of the income or capital interest in the partnership or (b) which, at any
time during its tax year, is engaged in the conduct of trade or business in the
United States. Moreover, the payment by the foreign office of other brokers of
the proceeds of the sale of the notes (including any accrued but unpaid
interest), will not be subject to backup withholding, unless the payor has
actual knowledge or reason to know that the payee is a United States person.
Principal and interest so paid by the United States office of a custodian,
nominee or agent, or the payment of the proceeds of a sale of a note by the
United States office of a broker, is subject to backup withholding, unless the
beneficial owner certifies its non-United States status under penalties of
perjury or otherwise establishes an exemption.
Prospective investors should consult their own tax advisors concerning the
tax consequences of their particular situations.
CANADIAN FEDERAL INCOME TAX CONSIDERATIONS
In the opinion of Bennett Jones LLP, Calgary, Alberta, Canada, special
Canadian tax counsel to Burlington Resources and Burlington Resources Finance
Company, the following summary addresses the material Canadian federal income
tax considerations to persons who are non-residents of Canada of purchasing,
owning and disposing of notes which constitute capital property, for the purpose
of the Income Tax Act (Canada) (the "ITA"), to such persons. This summary is
based on the current provisions of the ITA and the regulations thereunder, the
understanding of Bennett Jones LLP of the current assessing and administrative
practices of the Canada Customs and Revenue Agency (the "CCRA") and all specific
proposals to amend the ITA and the regulations thereunder publicly announced by
the Minister of Finance (Canada) before the date of this prospectus supplement.
This summary does not otherwise take into account or anticipate changes in the
law or in the assessment and administrative practices of the CCRA, whether by
judicial, governmental or legislative decision or action, nor does it take into
account tax legislation or considerations of any province or territory of Canada
or any jurisdiction other than Canada. This summary is of a general nature only
and is not intended to
S-10
be, and should not be interpreted as, legal or tax advice to any holder of
notes. This summary is not applicable to any holder other than an initial holder
who purchases notes pursuant to the offering.
The payment of interest, premium, if any, and principal by Burlington
Resources Finance Company on the notes to initial holders who are non-residents
of Canada with whom Burlington Resources Finance Company is dealing at arm's
length, within the meaning of the ITA, at the time of making the payment will
not be subject to non-resident withholding tax under the ITA. For the purposes
of the ITA, related persons (as defined therein) are deemed not to deal at arm's
length and it is a question of fact whether persons not related to each other
deal at arm's length.
No other tax on income (including capital gains) will be payable under the
ITA in respect of the holding, repayment, redemption or disposition of the
notes, or the receipt of interest, premium, if any, or principal thereon by
holders who are not resident, or deemed to be resident, in Canada and who do not
use or hold, and are not deemed to use or hold, the notes in carrying on
business in Canada, for the purpose of the ITA, except that in certain
circumstances, holders who are non-resident insurers carrying on business in
Canada, and elsewhere, may be subject to taxes in Canada under the ITA.
S-11
UNDERWRITING
Subject to the terms and conditions stated in the underwriting agreement
dated the date hereof, each underwriter named below has severally agreed to
purchase, and Burlington Resources Finance Company has agreed to sell to such
underwriter, the principal amount of notes set forth opposite the name of such
underwriter.
<Table>
<Caption>
- ----------------------------------------------------------------------------------------
NAME PRINCIPAL AMOUNT OF NOTES
- ----------------------------------------------------------------------------------------
J.P. Morgan Securities Inc. ................................ $210,000,000
Banc of America Securities LLC.............................. 35,000,000
Fleet Securities, Inc. ..................................... 35,000,000
Salomon Smith Barney Inc. .................................. 35,000,000
TD Securities (USA) Inc. ................................... 35,000,000
------------
Total....................................................... $350,000,000
============
</Table>
The underwriting agreement provides that the obligations of the several
underwriters to purchase the notes included in this offering are subject to
approval of certain legal matters by counsel and to certain other conditions.
The underwriters are obligated to purchase all the notes if they purchase any of
the notes.
The underwriters propose to offer some of the notes directly to the public
at the public offering price set forth on the cover page of this prospectus
supplement and some of the notes to certain dealers at the public offering price
less a concession not in excess of 0.350% of the principal amount of the notes.
The underwriters may allow, and such dealers may reallow, a concession not in
excess of 0.250% of the principal amount of the notes on sales to certain other
dealers. After the initial offering of the notes to the public, the public
offering price and such commissions and concessions may be changed by the
underwriters.
The following table shows the underwriting commissions to be paid to the
underwriters by Burlington Resources Finance Company in connection with this
offering (expressed as a percentage of the principal amount of the notes).
<Table>
<Caption>
- ---------------------------------------------------------------------------------
PAID BY BURLINGTON
RESOURCES FINANCE
- ---------------------------------------------------------------------------------
Per note.................................................... 0.600%
- ---------------------------------------------------------------------------------
</Table>
In connection with the offering, J.P. Morgan Securities Inc. ("JPMorgan"),
on behalf of the underwriters, may purchase and sell notes in the open market.
These transactions may include over-allotment, covering transactions and
stabilizing transactions. Over-allotment involves sales of notes in excess of
the principal amount of notes to be purchased by the underwriter in the
offering, which creates a short position. Covering transactions involve
purchases of the notes in the open market after the distribution has been
completed in order to cover syndicate short positions. Stabilizing transactions
consist of certain bids or purchases of notes made for the purpose of preventing
or retarding a decline in the market price of the notes while the offering is in
progress.
Any of these activities may cause the price of the notes to be higher than
the price that otherwise would exist in the open market in the absence of such
transactions. These
S-12
transactions may be effected in the over-the-counter market or otherwise and, if
commenced, may be discontinued at any time.
Burlington Resources Finance Company estimates that its total expenses of
this offering, excluding commissions, will be $175,000.
JPMorgan will make the notes available for distribution on the Internet
through a proprietary Web site and/or a third-party system operated by Market
Axess Inc., an Internet-based communications technology provider. Market Axess
Inc. is providing the system as a conduit for communications between JPMorgan
and its customers and is not a party to any transactions. Market Axess Inc., a
registered broker-dealer, will receive compensation from JPMorgan based on
transactions JPMorgan conducts through the system. JPMorgan will make the notes
available to its customers through the Internet distributions, whether made
through a proprietary or third-party system, on the same terms as distributions
made through other channels.
JPMorgan Chase Bank is agent, and JPMorgan is adviser and arranger under a
credit facility which provides support for the commercial paper being repaid
with the proceeds of this offering. There are no outstanding borrowings under
such credit agreement. Citibank, N.A., the trustee for the notes, is an
affiliate of Salomon Smith Barney Inc. The underwriters and/or their affiliates
have performed certain investment banking and advisory services for Burlington
Resources from time to time for which they have received customary fees and
expenses. The underwriters and/or their affiliates may, from time to time,
engage in transactions with and perform services for Burlington Resources and/or
its affiliates in the ordinary course of their business.
Burlington Resources Finance Company has agreed to indemnify the
underwriters against certain liabilities, including liabilities under the
Securities Act of 1933, or to contribute to payments the underwriters may be
required to make in respect of any of those liabilities. Burlington Resources
has agreed to guarantee this indemnity obligation.
LEGAL MATTERS
The legality of the notes will be passed upon for us by Bennett Jones LLP,
Calgary, Alberta, Canada, with respect to various matters of Canadian law and
Cahill Gordon & Reindel, New York, New York, with respect to various matters of
United States law. Kenneth W. Orce, a member of Burlington Resources' board of
directors, is a senior partner of Cahill Gordon & Reindel and, as of December
31, 2001, beneficially owned 36,877 shares of Burlington Resources common stock,
including 24,252 currently exercisable options. Certain legal matters will be
passed upon for the underwriters by Cravath, Swaine & Moore, New York, New York.
EXPERTS
The audited financial statements incorporated in this prospectus by
reference to the Annual Report on Form 10-K for the year ended December 31,
2001, except as they relate to Canadian Hunter Exploration Ltd. prior to fiscal
year 2001 and Burlington Resources Canada Ltd. (formerly Burlington Resources
Canada Energy Ltd., formerly Poco Petroleums Ltd.) prior to fiscal year 2000,
have been audited by PricewaterhouseCoopers LLP, independent accountants, and,
insofar as they relate to Canadian Hunter Exploration Ltd. prior to fiscal year
2001, by
S-13
Ernst & Young LLP, chartered accountants, and, insofar as they relate to
Burlington Resources Canada Ltd. prior to fiscal year 2000, by KPMG LLP,
independent accountants, each of whose reports are incorporated by reference
herein. Such financial statements have been so incorporated in reliance on the
reports of such independent accountants given on the authority of such firms as
experts in auditing and accounting.
S-14
PROSPECTUS
$1,500,000,000
BURLINGTON RESOURCES INC.
DEBT SECURITIES
COMMON STOCK
PREFERRED STOCK
BURLINGTON RESOURCES CAPITAL I
BURLINGTON RESOURCES CAPITAL II
TRUST PREFERRED SECURITIES FULLY AND UNCONDITIONALLY
GUARANTEED BY BURLINGTON RESOURCES INC.
BURLINGTON RESOURCES FINANCE COMPANY
DEBT SECURITIES FULLY AND UNCONDITIONALLY
GUARANTEED BY BURLINGTON RESOURCES INC.
Burlington Resources Inc. may offer, from time to time, in one or more
series
- unsecured senior debt securities;
- unsecured subordinated debt securities;
- shares of common stock; and
- shares of preferred stock.
From time to time, the Burlington Resources trusts may offer trust
preferred securities fully and unconditionally guaranteed on a subordinated
basis by Burlington Resources Inc.
From time to time, Burlington Resources Finance Company may offer and sell
debt securities in one or more series, consisting of notes, debentures or other
evidences of indebtedness. The debt securities will be fully and unconditionally
guaranteed by Burlington Resources Inc.
The securities:
- will have a maximum aggregate offering price of $1,500,000,000;
- will be offered at prices and on terms to be set forth in an
accompanying prospectus supplement;
- may be denominated in U.S. dollars or in other currencies or currency
units;
- may be offered separately or together, or in separate series; and
- may be listed on a national securities exchange, if specified in an
accompanying prospectus supplement.
---------------------
Burlington Resources Inc.'s common stock is listed on the New York Stock
Exchange under the symbol "BR."
---------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
---------------------
The securities may be sold directly, through agents from time to time or
through underwriters and/or dealers. If any agent of the issuers or any
underwriter is involved in the sale of the securities, the name of the agent or
underwriter and any applicable commission or discount will be set forth in the
accompanying prospectus supplement.
---------------------
This prospectus may be used to offer and sell securities only if
accompanied by a prospectus supplement.
The date of this prospectus is June 27, 2001
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS AND THE ACCOMPANYING PROSPECTUS SUPPLEMENT. NO
PERSON IS AUTHORIZED TO PROVIDE YOU WITH DIFFERENT INFORMATION OR TO OFFER ANY
SECURITIES IN ANY STATE WHERE THE OFFER IS NOT PERMITTED. YOU SHOULD NOT ASSUME
THAT THE INFORMATION PROVIDED BY THIS PROSPECTUS OR THE ACCOMPANYING PROSPECTUS
SUPPLEMENT IS ACCURATE AS OF ANY DATE OTHER THAN THE RESPECTIVE DATES ON THE
FRONT OF THOSE DOCUMENTS. IN THIS PROSPECTUS, REFERENCES TO "BURLINGTON
RESOURCES" MEAN BURLINGTON RESOURCES INC., REFERENCES TO "BURLINGTON RESOURCES
FINANCE COMPANY" MEAN BURLINGTON RESOURCES FINANCE COMPANY, REFERENCES TO THE
"BURLINGTON RESOURCES TRUSTS" MEAN, COLLECTIVELY, BURLINGTON RESOURCES CAPITAL I
AND BURLINGTON RESOURCES CAPITAL II, AND REFERENCES TO "WE," "US" AND "OUR"
MEAN, COLLECTIVELY, BURLINGTON RESOURCES, BURLINGTON RESOURCES FINANCE COMPANY
AND THE BURLINGTON RESOURCES TRUSTS. UNLESS OTHERWISE STATED, THE DOLLAR AMOUNTS
AND FINANCIAL DATA CONTAINED IN THIS PROSPECTUS AND THE ACCOMPANYING PROSPECTUS
SUPPLEMENT ARE PRESENTED IN U.S. DOLLARS.
TABLE OF CONTENTS
<Table>
<Caption>
PAGE
Where You Can Find More Information.... 2
Incorporation of Certain Documents By
Reference............................ 3
Forward-Looking Statements............. 4
Burlington Resources................... 4
The Burlington Resources Trusts........ 5
Burlington Resources Finance Company... 6
Use of Proceeds........................ 6
</Table>
<Table>
<Caption>
PAGE
Ratio of Earnings to Fixed Charges..... 6
Description of Debt Securities......... 6
Description of Capital Stock of
Burlington Resources................. 19
Description of Trust Preferred
Securities and Trust Guarantees...... 24
Plan of Distribution................... 27
Legal Matters.......................... 28
Experts................................ 28
</Table>
---------------------
WHERE YOU CAN FIND MORE INFORMATION
We have filed a joint registration statement with the Securities and
Exchange Commission; however, we did not include separate financial statements
of the Burlington Resources trusts or of Burlington Resources Finance Company in
this prospectus because:
- all of the voting rights of the Burlington Resources trusts and
Burlington Resources Finance Company will be owned by Burlington
Resources, either directly or through wholly-owned subsidiaries of
Burlington Resources, which files regular reports with the Securities and
Exchange Commission;
- neither of the Burlington Resources trusts nor Burlington Resources
Finance Company has any operations other than transferring funds to
Burlington Resources' subsidiaries; and
- Burlington Resources will fully and unconditionally guarantee the
Burlington Resources trusts' and Burlington Resources Finance Company's
obligations and the rights of holders.
Each time we offer to sell securities, whether by the Burlington Resources
trusts, Burlington Resources Finance Company or Burlington Resources, we will
provide a prospectus supplement that will contain specific information about the
terms of that offering, including any guarantees. The prospectus supplement may
also add, update or change information contained
2
in this prospectus. This prospectus, together with the applicable prospectus
supplement, will include or refer you to all material information relating to
each offering.
Burlington Resources trusts and Burlington Resources Finance Company are
not required to file periodic and other documents under the Securities Exchange
Act of 1934. Burlington Resources does not intend to include in its consolidated
financial statements any separate financial information regarding the Burlington
Resources trusts or Burlington Resources Finance Company. Also, in view of
Burlington Resources' guarantees, neither of the Burlington Resources trusts nor
Burlington Resources Finance Company intend to furnish holders of the debt
securities with separate financial statements or other reports.
This prospectus does not contain all the information set forth in the
registration statement, certain parts of which are omitted in accordance with
the rules and regulations of the SEC. For more information about Burlington
Resources, the Burlington Resources trusts, Burlington Resources Finance Company
and the securities covered by this prospectus, you should see the registration
statement and the exhibits and schedules. Any statement made in this prospectus
concerning the provisions of the documents may be incomplete, and you should
refer to the copy of such documents filed as an exhibit to the registration
statement with the SEC.
Burlington Resources files annual, quarterly and special reports, proxy
statements and other information with the SEC. These filings are available to
the public over the Internet at the SEC's web site at http://www.sec.gov. You
may obtain information on the operation of the SEC's public reference room by
calling the SEC at 1-800-SEC-0330. You may also read and copy any document we
file at this room located at 450 Fifth Street, N.W., Washington, DC 20549.
You can also inspect these materials at the New York Stock Exchange at 20
Broad Street, New York, New York 10005.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to incorporate by reference the information we file with
them, which means that we can disclose important information to you by referring
you to those documents. The information incorporated by reference is an
important part of this prospectus, and information we file with the SEC after
the date of this prospectus will automatically update and supersede the
information included and the information incorporated by reference in this
prospectus.
We incorporate by reference the following documents and any of Burlington
Resources' future filings with the SEC under Section 13(a), 13(c), 14 or 15(d)
of the Securities Exchange Act of 1934 until our offering is complete:
- Burlington Resources' Annual Report on Form 10-K for the fiscal year
ended December 31, 2000;
- Burlington Resources' Report on Form 10-Q for the quarter ended March 31,
2001;
- Burlington Resources' Report on Form 8-K filed February 8, 2001;
- The description of Burlington Resources common stock contained in
Burlington Resources' Rule 424(b) Prospectus, dated July 7, 1988; and
- The description of Burlington Resources' rights agreement contained in
Burlington Resources' Registration Statement on Form 8-A filed with the
SEC on December 18, 1998.
3
On request, we will provide without charge a copy of any or all of the
above documents incorporated by reference (other than exhibits to documents,
unless the exhibits are specifically incorporated by reference into the
documents that this prospectus incorporates). Send your written or oral requests
to: Jeffery P. Monte, Corporate Secretary, Burlington Resources Inc., 5051
Westheimer, Suite 1400, Houston, Texas 77056, telephone: (713) 624-9500.
FORWARD-LOOKING STATEMENTS
This prospectus contains projections and other forward-looking statements
within the meaning of Section 21E of the Securities Exchange Act of 1934.
Sometimes these statements will contain words such as "believes," "expects,"
"intends," "plans" and other similar words. These projections and statements
reflect our current views with respect to future events and financial
performance. We can not assure you, however, that these events will occur or
that these projections will be achieved, and our actual results could differ
materially from those projected because of various risks, uncertainties and
other important factors. These risks, uncertainties and factors include:
- fluctuations in commodity pricing and demand;
- risks associated with exploring for, developing and producing crude oil
and natural gas;
- risks associated with large development projects;
- risks inherent in foreign operations such as changes in laws, policies,
regulations, taxation and political climate;
- competition for raw materials and customers in the crude oil and natural
gas industry;
- changes in laws and regulations affecting our operations;
- potential environmental liabilities; and
- outcome of pending or threatened litigation.
Given these uncertainties, you should not place undue reliance on these
forward-looking statements. You should read the description of these factors
under the caption "Forward-Looking Statements" in Burlington Resources' latest
Annual Report on Form 10-K.
BURLINGTON RESOURCES
Burlington Resources is a holding company engaged, through its principal
subsidiaries, Burlington Resources Oil & Gas Company LP, The Louisiana Land and
Exploration Company, Burlington Resources Canada Energy Ltd. and their
affiliated companies, in the exploration, development, production and marketing
of crude oil and natural gas.
Burlington Resources' principal executive offices are located at 5051
Westheimer, Suite 1400, Houston, Texas 77056, telephone: (713) 624-9500.
4
THE BURLINGTON RESOURCES TRUSTS
Each of Burlington Resources Capital I and Burlington Resources Capital II
is a statutory business trust formed under Delaware law through the filing of a
certificate of trust with the Delaware Secretary of State. Each trust's business
will be defined in a declaration of trust which will be executed by Burlington
Resources, as sponsor and depositor for each of the trusts, and the trustees for
each of the trusts. Unless stated otherwise in the prospectus supplement, each
trust exists exclusively to:
- issue and sell the trust preferred securities and the trust common
securities;
- invest the gross proceeds of the sale of the trust preferred securities
and trust common securities in a specific series of subordinated debt
securities of Burlington Resources; and
- engage in only those other activities necessary, convenient or incidental
to carrying out the first two purposes.
All of the trust common securities will be owned by Burlington Resources.
The trust common securities will rank equally, and payments will be made on the
trust common securities pro rata, with the trust preferred securities. However,
upon an event of default under the indenture governing the subordinated debt
securities, holders of the trust preferred securities have a right to be paid
before the holders of the trust common securities on distribution and on
liquidation, redemption and otherwise.
Burlington Resources will acquire trust common securities having an
aggregate liquidation amount equal to a minimum of 1% of the total capital of
each trust. Each trust will have a term of at least 20 but not more than 50
years, but may terminate earlier as provided in the applicable declaration of
trust.
Each trust's business and affairs will be conducted by its trustees, whose
obligations and duties will be governed by the declaration of trust. Subject to
limited exceptions, the holder(s) of the trust common securities will be
entitled to appoint, remove or replace any of, or increase or reduce the number
of, the trustees of each trust. At least one of the trustees of each of the
trusts will be a person who is an employee or officer of or an affiliate of
Burlington Resources. One trustee of each trust will be a financial institution
that is not affiliated with Burlington Resources and will act as property
trustee and as indenture trustee for the purposes of the Trust Indenture Act of
1939, as amended. A more detailed description of these provisions will be
contained in the prospectus supplement.
Unless the property trustee maintains a principal place of business in
Delaware and otherwise meets the requirements of applicable law, one trustee of
each trust will be either an individual or a company who has a residence or a
principal place of business in Delaware. Burlington Resources will pay all fees
and expenses related to each trust and the offering of securities. Unless
otherwise set forth in the prospectus supplement, the property trustee will be
The Chase Manhattan Bank and the Delaware trustee will be Chase Manhattan Bank
Delaware. The office of the Delaware trustee is 1201 Market Street, Wilmington,
Delaware 19801.
The principal place of business of the Burlington Resources trusts are c/o
Burlington Resources Inc., 5051 Westheimer, Suite 1400, Houston, Texas 77056,
telephone: (713) 624-9500.
5
BURLINGTON RESOURCES FINANCE COMPANY
Burlington Resources Finance Company is an unlimited liability company
organized in February 2000 under the laws of Nova Scotia, Canada. Burlington
Resources Finance Company is a direct wholly-owned subsidiary of Burlington
Resources. Burlington Resources Finance Company will issue debt securities which
securities will be guaranteed by Burlington Resources.
The principal place of business of Burlington Resources Finance Company is
c/o Burlington Resources Canada Energy Ltd., Suite 3700, 250-6th Avenue, S.W.,
Calgary, Alberta T2P 3H7, Canada, telephone: (403) 260-8000.
USE OF PROCEEDS
Unless we set forth other uses of proceeds in the prospectus supplement, we
will use the net proceeds of the sale of the securities described in this
prospectus and any prospectus supplement for general corporate purposes. These
may include the reduction of outstanding indebtedness, working capital
increases, capital expenditures or acquisitions. Unless we set forth other uses
of proceeds in the prospectus supplement, each Burlington Resources trust will
use all proceeds received from the sale of trust preferred securities to
purchase subordinated debt securities of Burlington Resources. We intend to use
the net proceeds from the sale of subordinated debt securities for the general
corporate purposes described above.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth Burlington Resources' consolidated ratios of
earnings to fixed charges for the indicated periods.
<Table>
<Caption>
THREE MONTHS ENDED
MARCH 31, YEAR ENDED DECEMBER 31,
- --------------------------------- ----------------------------------------------------------
2001 2000 2000 1999 1998 1997 1996
- --------------------- ---------- ---------- ---------- ---------- ---------- ----------
12.69x 3.63x 5.72x .94x -- 3.36x 3.38x
</Table>
Total earnings available for fixed charges for the year ended 1998 were
inadequate to cover total fixed charges in the amount of approximately $638
million primarily as a result of the impairment of oil and gas assets related to
the adoption of Statement of Financial Accounting Standard No. 121 ($706 million
pretax or $390 million after tax in 1998).
For purposes of calculating the ratio of earnings to fixed charges,
earnings represent pretax income from continuing operations available for fixed
charges, less equity in undistributed earnings of 20-50% owned companies,
together with a portion of rent under long-term operating leases representative
of an interest factor. Fixed charges represent interest expense, capitalized
interest and a portion of rent under long-term operating leases representative
of an interest factor.
DESCRIPTION OF DEBT SECURITIES
The following description of the debt securities sets forth certain general
terms and provisions of the debt securities to which this prospectus and any
prospectus supplement may relate. The particular terms of any series of debt
securities and the extent to which the general provisions may apply to a
particular series of debt securities will be described in a prospectus
6
supplement relating to that series. Burlington Resources and Burlington
Resources Finance Company may issue senior debt securities and Burlington
Resources may issue subordinated debt securities under indentures with Citibank,
N.A., as trustee.
We have summarized selected provisions of the indentures below. The summary
is not complete. The form of Burlington Resources Finance Company's senior
indenture has been incorporated by reference in this registration statement and
the forms of Burlington Resources' senior indenture and subordinated indenture
are filed as exhibits to this registration statement. You should read the
indentures for provisions that may be important to you.
Because we have included only a summary of the indenture terms, you must
read the indentures in full to understand every detail of the terms of the debt
securities. If you would like to read the indentures in their entirety, see
"Where You Can Find More Information."
For purposes of this section, the "issuer" means Burlington Resources, in
the case of debt securities issued by Burlington Resources, and Burlington
Resources Finance Company, in the case of debt securities issued by Burlington
Resources Finance Company, while the "guarantor" means Burlington Resources, in
the case of debt securities issued by Burlington Resources Finance Company, and
has no meaning in the case of debt securities issued by Burlington Resources.
Also, the term "indenture," in the case of debt securities issued by Burlington
Resources Finance Company, includes the guarantee agreement pursuant to which
the guarantor guarantees the debt securities.
GENERAL
The debt securities will be unsecured obligations of the issuer. None of
the indentures limit the amount of debt securities the issuer may issue.
You should read the prospectus supplement relating to the particular series
of debt securities for the following terms of the offered debt securities:
- the title of the debt securities;
- any limit upon the aggregate principal amount of the debt securities;
- the dates on which the principal of the debt securities is payable;
- the interest rate of the debt securities, or the method for calculating
the interest rate, and the date or dates from which interest will accrue;
- the interest payment dates and the record dates for the interest payment
dates;
- places where payments of the principal and interest, if any, may be made
on the debt securities;
- the terms and conditions upon which the debt securities may be redeemed
at the issuer's option or otherwise;
- any mandatory or optional sinking fund or analogous provisions;
- the denominations in which the debt securities are issuable;
- whether any portion of the principal amount of such debt securities is
payable upon declaration of the acceleration of the maturity thereof;
7
- if other than U.S. dollars, the currency or currency units in which the
debt securities are denominated and/or in which payment of the principal
of (and premium, if any) and/or interest on the debt securities will or
may be payable;
- any deletions, modifications or additions to the events of default or
covenants pertaining to the debt securities;
- whether the debt securities will be convertible into or exchangeable for
other securities or other property; and
- any other terms not inconsistent with the indentures, including, without
limitation, the addition of covenants applicable to the debt securities.
Unless otherwise indicated in the prospectus supplement, the issuer will
issue the debt securities only in fully registered form without coupons in
denominations of $1,000 or any integral multiple thereof. There will not be any
service charge for any registration of transfer or exchange of debt securities,
but the issuer may require payment of a sum sufficient to cover any tax or other
governmental charge.
RANKING OF DEBT SECURITIES
Burlington Resources' senior debt securities will be unsecured and will
rank equally and ratably with Burlington Resources' other unsecured and
unsubordinated debt.
Burlington Resources' subordinated debt securities will be junior in right
of payment to all of Burlington Resources' senior indebtedness to the extent
described in the prospectus supplement.
The debt securities issued by Burlington Resources Finance Company will be:
- senior unsecured obligations of Burlington Resources Finance Company and
will rank equally and ratably with all other unsecured and unsubordinated
indebtedness of Burlington Resources Finance Company; and
- guaranteed on a senior unsecured basis by Burlington Resources, which
guarantee will rank equally and ratably with all other unsecured and
unsubordinated indebtedness of Burlington Resources.
Dividend and other distributions to the issuer from the issuer's various
subsidiaries may be subject to certain statutory, contractual and other
restrictions (including, without limitation, exchange controls that may be
applicable to foreign subsidiaries). The rights of the issuer's creditors to
participate in the assets of any subsidiary upon that subsidiary's liquidation
or recapitalization will be subject to the prior claims of the subsidiary's
creditors, except to the extent that the issuer may itself be a creditor with
recognized claims against the subsidiary. In the case of debt securities issued
by Burlington Resources Finance Company, the claims of holders under the
guarantee by Burlington Resources will be effectively subordinated to the claims
of creditors of Burlington Resources' subsidiaries other than Burlington
Resources Finance Company. The indentures do not restrict the amount of
indebtedness that Burlington Resources, Burlington Resources Finance Company or
Burlington Resources' other subsidiaries may incur.
8
GUARANTEES
Burlington Resources will fully and unconditionally guarantee to each
holder of a debt security issued by Burlington Resources Finance Company and
authenticated and delivered by the trustee the due and punctual payment of the
principal of, and any premium and interest on, the debt security, when and as it
becomes due and payable, whether at maturity, upon acceleration, by call for
redemption, repayment or otherwise in accordance with the terms of the debt
securities and of the indenture.
Burlington Resources will:
- agree that, if an event of default occurs under the debt securities, its
obligations under the guarantees will be absolute and unconditional and
will be enforceable irrespective of any invalidity, irregularity or
unenforceability of any series of the debt securities or the indenture or
any supplement thereto,
- waive its right to require the trustee or the holders to pursue or
exhaust their legal or equitable remedies against Burlington Resources
Finance Company before exercising their rights under the guarantees, and
- agree to be subject to the restrictions set forth below under "Limitation
of Liens" and "Merger, Amalgamation, Consolidation and Assumption" as if
Burlington Resources was the "issuer."
COVENANTS
The indentures contain, among others, the covenants summarized below, which
will be applicable (unless waived or amended) to any series of debt securities
which are outstanding, unless stated otherwise in the prospectus supplement
relating to a particular series.
Important Definitions. The following definitions will help in
understanding the meaning of certain words and phrases used in the indenture
covenants and discussed in the summary:
The term "capital stock", as applied to the stock of any Person, means the
capital stock of every class, whether now or authorized after the date of this
prospectus, regardless of whether the capital stock is limited to a fixed sum or
percentage with respect to rights of the holders of the capital stock to
participate in dividends and in the distribution of assets upon the voluntary or
involuntary liquidation, dissolution or winding-up of such Person.
The term "consolidated net tangible assets" means the aggregate amount of
assets of Burlington Resources and its subsidiaries (less applicable reserves
and other properly deductible items) after deducting from the aggregate amount:
- all current liabilities (excluding any which are by their terms
extendible or renewable at the option of the obligor of the liability to
a time more than 12 months after the time the amount of such liability is
being computed), and
- all goodwill, trade names, trademarks, patents, organization expenses and
other like intangibles of Burlington Resources and its subsidiaries, all
as set forth on the most recent balance sheet of Burlington Resources and
its subsidiaries and computed in accordance with generally accepted
accounting principles.
The term "debt" means indebtedness for money borrowed.
The term "lien" means any mortgage, pledge or lien.
9
The term "principal property" means any oil, gas or mineral producing
property, or any refining, processing, smelting or manufacturing facility, of
the issuer or any restricted subsidiary located in the United States of America.
The following are not included in the term "principal property":
- property employed in transportation, distribution or marketing,
- information and electronic data processing equipment,
- any refinery, preparation plant, concentrator, smelter, mill or handling,
processing or manufacturing facility in which the interests held by the
issuer, or by one or more restricted subsidiaries or both and by others
and the aggregate interest held by the issuer and all of its restricted
subsidiaries does not equal or exceed 50%,
- any property which in the opinion of the board of directors of the issuer
is not materially important to the total business conducted by the issuer
and its subsidiaries as an entirety or
- any property or a portion of a particular property which in the opinion
of the board of directors of the issuer is not materially important to
the use or operation of such property.
The term "restricted subsidiary" means a subsidiary of the issuer:
- substantially all the property of which is located, or substantially all
the business of which is carried on, within the United States of America,
- which owns a principal property and
- which has stockholders' equity exceeding 2% of consolidated net tangible
assets of Burlington Resources.
The term "stockholders' equity" means, with respect to any Person,
stockholders' equity as computed in accordance with generally accepted
accounting principles.
The term "subsidiary" means a corporation in which a person and one or more
of its subsidiaries own more than 50% of the outstanding voting stock, either
directly or indirectly through intermediary subsidiaries.
Limitation on Liens. The indentures provide that, so long as any debt
securities issued under such indenture are outstanding, the issuer will not, and
will not allow any of its restricted subsidiaries to, incur, issue, assume or
guarantee any debt secured after the date of the applicable indenture by lien on
any principal property of the issuer or any restricted subsidiary or any shares
of capital stock of or debt of any restricted subsidiary, unless the issuer
provides that the debt securities subject to the indenture and, if the issuer
chooses, any other debt securities of the issuer or any restricted subsidiary
which is not subordinated to such debt securities, are also secured equally and
ratably with such secured debt.
This restriction will not apply if, after giving effect to all such secured
debt, the aggregate amount of such secured debt of the issuer and the restricted
subsidiaries would not exceed 10% of consolidated net tangible assets.
10
In addition, this restriction will not apply to the following and the
following will be excluded from constituting secured debt in any computation
under the immediately preceding paragraph, debt secured by:
(1) liens on property or any interest in any property, construction on
property or improvement to property to secure all or any part of the costs
incurred after the date of the applicable indenture for surveying,
exploration, drilling, mining or other extraction, development,
construction, alteration, repair or improvement of, in, under or on such
property or to secure debt incurred to provide funds for any such purpose
(it being understood that, in the case of oil, gas or mineral
properties, or interests in such properties, costs incurred after the
date of the applicable indenture for development shall include costs
incurred for all facilities relating to such properties or to projects,
ventures or other arrangements of which such properties form a part or
which relate to such properties or interests, which facilities may
include, without limitation:
- any drilling equipment, production equipment and platforms or
mining equipment, pipelines, pumping stations or other pipeline
facilities;
- terminals or warehouses or storage facilities;
- bulk plants;
- production, separation, dehydration, extraction, treating and
processing facilities;
- gasification or gas liquefying facilities, flares, stacks or
burning towers;
- flotation mills, crushers and ore handling facilities;
- tank cars, tankers, barges, ships, trucks, automobiles, airplanes
or other marine, automotive, aeronautical or other similar moveable
facilities or equipment;
- computer systems and associated programs or office equipment;
- roads, airports and docks (including drydocks);
- reservoirs or waste disposal facilities;
- sewers, generating plants or electric lines;
- telephone and telegraph lines, radio and other communications
facilities;
- townsites, housing facilities, recreation halls, stores and other
related facilities; and
- similar facilities and equipment of or associated with any of the
above, whether or not in whole or in part located or from time to
time located at or on such properties, projects, ventures or the
situs of such other arrangements);
(2) liens or the creation of encumbrances on an oil and/or gas or
mineral producing property to secure obligations incurred or guarantees of
obligations incurred in connection with or necessarily incidental to
commitments of purchase or sale of, or the transportation or distribution
of, the products derived from such property;
11
(3) liens on:
- drilling equipment, production equipment and platforms or mining
equipment, pipelines, pumping stations or other pipeline
facilities;
- terminals or warehouses or storage facilities;
- bulk plants;
- production, separation, dehydration, extraction, treating and
processing facilities;
- gasification or gas liquefying facilities, flares, stacks or
burning towers;
- flotation mills, crushers and ore handling facilities;
- tank cars, tankers, barges, ships, trucks, automobiles, airplanes
or other marine, automotive, aeronautical or other similar moveable
facilities or equipment;
- computer systems and associated programs or office equipment;
- roads, airports and docks (including drydocks);
- reservoirs or waste disposal facilities;
- sewers, generating plants or electric lines;
- telephone and telegraph lines, radio and other communications
facilities;
- townsites, housing facilities, recreation halls, stores and other
related facilities;
- real and personal property used primarily for purposes other than
those of principal properties; and
- similar facilities and equipment of or associated with any of the
above, whether or not in whole or in part located or from time to
time located at or on such properties, projects, ventures or the
situs of such other arrangements;
(4) liens on property existing at the time of acquisition of such
property or mortgages to secure the payment of all or any part of the
purchase price of such property or to secure any debt, incurred prior to,
at the time of or within 24 months after the acquisition of such property
for the purpose of financing all or any part of the purchase price of such
property;
(5) liens:
- in favor of the United States of America, any State or municipality
of the United States of America, or any other country or any
political subdivision, department, agency or instrumentality of any
of them to secure moneys borrowed from or by such authorities,
whether or not such moneys are borrowed or the repayment of such
moneys is guaranteed by the issuer or by any restricted subsidiary,
including, without limitation, liens to secure debt issued, assumed
or guaranteed in pollution control or industrial revenue bond
financings, or
- to secure the performance of any covenant or obligation to or in
favor of or entered into at the request of such authorities where
such security is required pursuant to any contract, order,
direction, regulation or statute;
(6) liens in existence prior to the date of the applicable indenture;
12
(7) liens by any restricted subsidiary pursuant to the terms of any
trust deed or similar document entered into by such restricted subsidiary,
or by a predecessor of such restricted subsidiary, prior to the date when
it became a subsidiary;
(8) liens existing on any of the properties of, or on any shares of
capital stock or debt of, a corporation (including, but not limited to, a
restricted subsidiary) at the time when such corporation becomes a
subsidiary or is consolidated with or merged into the issuer or a
subsidiary or liens existing upon property, capital stock or debt at the
time of acquisition of such;
(9) liens which secure only indebtedness owing by a subsidiary to the
issuer or by a subsidiary or the issuer to a subsidiary;
(10) any extension, renewal or replacement (or successive extensions,
renewals or replacements), as a whole or in part, of any lien referred to
in the foregoing clauses (1) to (9) inclusive, so long as such extension,
renewal or replacement of such lien is limited to all or any part of the
same property, shares of capital stock or debt that secured the lien
extended, renewed or replaced (plus improvements on such property);
(11) pledges or deposits under workmen's compensation, unemployment
insurance or similar statutes, mechanics', workmen's, repairmen's,
materialmen's, carriers' or other similar liens arising in the ordinary
course of business or deposits or pledges to obtain the release of any such
liens;
(12) liens:
- created by or resulting from any litigation or other proceedings,
including liens arising out of judgments or awards against the
issuer or any restricted subsidiary, with respect to which the
issuer or such restricted subsidiary is in good faith prosecuting
an appeal or proceeding for review, or
- incurred by the issuer or any restricted subsidiary for the
purpose of obtaining a stay or discharge in the course of any
legal proceeding to which the issuer or such restricted subsidiary
is a party;
(13) liens for taxes or assessments or governmental charges or levies
not yet due or delinquent, or which can thereafter be paid without penalty,
or which are being contested in good faith by appropriate proceedings,
landlord's liens on property held under lease, and other liens of a nature
similar to those described above in this clause (13) which do not, in the
opinion of the issuer or such restricted subsidiary, materially impair the
use of such property in the operation of the business of the issuer or such
restricted subsidiary or the value of such property for the purpose of such
business;
(14) easements, rights-of-way, restrictions and other similar charges
or encumbrances not interfering with the ordinary conduct of the business
of the issuer or any restricted subsidiary; and
(15) liens secured by pipeline assets of El Paso Natural Gas Company.
Under the indentures, the following types of transactions, among others,
will not be deemed to create debt secured by a lien: the sale (including any
forward sale) or other transfer of
- oil, gas, gold or other minerals, whether in place or when produced, for
a period of time until, or in an amount such that, the purchaser will
realize from such oil, gas, gold or
13
other minerals a specified amount of money (however determined) or a
specified amount of such minerals, or
- any other interest in property of the character commonly referred to as a
"production payment," "ore payment," "royalty interest," "overriding
royalty interest," or "mineral payment," or farmouts, the creation of
working interest, joint operating or unitization agreements, or other
similar transactions.
MERGER, AMALGAMATION, CONSOLIDATION AND ASSUMPTION
The issuer may, without the consent of any holders of outstanding debt
securities, consolidate or amalgamate with or merge into, or convey, transfer or
lease its assets substantially as an entirety to, any other corporation,
partnership, limited liability company, unlimited liability company or trust,
provided that:
- the person formed by such consolidation or amalgamation or into which the
issuer is merged or which acquires the issuer's assets expressly assumes
the issuer's obligations on the debt securities and under the indentures;
and
- other conditions described in the indentures are met.
The issuer may also, at any time, without complying with the above
conditions, convey, transfer or lease its assets substantially as an entirety to
any of its wholly-owned subsidiaries.
Additionally, Burlington Resources Finance Company, in the case of debt
securities issued by it, may assign all of its obligations under the debt
securities and the indenture to Burlington Resources or any of its subsidiaries,
provided that the person to which such obligations are assigned expressly
assumes Burlington Resources Finance Company's obligations under the debt
securities and the indenture and other conditions described in the indenture are
met.
Upon compliance with these provisions, the issuer will be relieved of its
obligations under the indentures and the debt securities.
EVENTS OF DEFAULT; RIGHTS ON DEFAULT
Each of the indentures defines an event of default with respect to debt
securities of any series as any of the following events:
- the issuer fails to pay interest for 30 days after it is due;
- the issuer fails to pay principal when due;
- the issuer fails to deposit any sinking fund payment when due, if
applicable to the series of debt securities;
- the issuer or the guarantor, if any, defaults for 90 days after
appropriate notice in the performance of any other covenant in the debt
securities, the applicable indenture or the guarantee agreement, as
applicable;
- the issuer or the guarantor, if any, has an event of bankruptcy,
insolvency or reorganization; or
- the guarantee, if any, ceases to be in full force and effect (other than
in accordance with the terms of the guarantee agreement) or the guarantor
denies or disaffirms its obligations under the guarantee.
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If an event of default occurs with respect to a particular series (but not
all series) of debt securities as a result of a failure to make a principal or
interest payment or because of a failure to perform another covenant, the
principal amount of all outstanding debt securities of that particular series
and accrued interest may be declared due and payable immediately by either:
- the trustee; or
- the holders of at least 25% in principal amount of that series.
If an event of default occurs with respect to all series of debt securities
as a result of a failure to perform a covenant or because of bankruptcy,
insolvency or reorganization, the principal amount of all outstanding debt
securities and accrued interest may be declared due and payable immediately by
either:
- the trustee; or
- the holders of at least 25% in principal amount of all outstanding debt
securities under the indenture.
The holders of a majority in principal amount of the outstanding debt
securities of any series affected, with each series voting as a separate class,
have the power to direct the time, method and place of conducting any proceeding
for any remedy available to the trustee or exercising any trust or power
conferred on the trustee. However, the direction must not conflict with any rule
of law or the indentures. Before proceeding to exercise any right or power under
the indentures at the direction of the holders, the trustee will be entitled to
receive from the holders reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in compliance with their
direction.
The issuer and the guarantor, if any, must furnish the trustee annually
with a statement that, to the best knowledge of the officers signing the
statement, the issuer or the guarantor, as the case may be, is not in default in
the performance of the terms of the indentures or, if the officers know that the
issuer or the guarantor, as the case may be, is in default, specifying the
default. The indentures require the trustee to give to all holders of
outstanding debt securities notice of any default by the issuer or the guarantor
unless the default has been cured or waived. However, except for a default in
the payment of principal of or interest on any outstanding debt securities, the
trustee can withhold notice if the board of directors, the executive committee
or a trust committee of directors or officers of the trustee in good faith
determine that withholding notice is in the interest of the holders of the
outstanding debt securities.
DEFEASANCE
If any series of debt securities have either:
- become due and payable or are by their terms due and payable within one
year; or
- are to be called for redemption within one year,
the indentures provide that the issuer may discharge substantially all of its or
the guarantor's, if any, obligations to holders of these series of debt
securities that have not already been delivered to the trustee for cancellation
by irrevocably depositing with the trustee enough funds to pay the principal of
and interest on the debt securities when the series matures.
The issuer can also discharge substantially all of its and the guarantor's,
if any, obligations for any series of debt securities, including its or the
guarantor's, if any, obligations under the
15
covenants in the indentures, by irrevocably depositing with the trustee enough
funds to pay the principal of and interest on the debt securities when the
series matures. The issuer must also obtain an opinion of counsel to the effect
that as a result of the defeasance, holders of that series of debt securities
will not recognize income, gain or loss for federal income tax purposes, and
will be subject to federal income tax on the same amount, in the same manner and
at the same time as would have been the case if such defeasance had not
occurred.
CHANGES IN CONTROL AND HIGHLY LEVERAGED TRANSACTIONS
The indentures do not contain provisions requiring the issuer or the
guarantor, if any, to redeem or to adjust the terms of the debt securities upon
a change in control.
Other than restrictions on liens described under "-- Covenants" above, the
indentures do not contain any covenants or other provisions designed to afford
holders of the debt securities protection in the event of a highly leveraged
transaction.
MODIFICATION OF THE INDENTURES
The indentures and the guarantee agreement provide that the issuer, the
guarantor, if any, and the trustee may enter into supplemental indentures
without the consent of the holders of debt securities to:
- secure any of the debt securities;
- evidence the assumption by a successor corporation of the issuer's or the
guarantor's obligations, as the case may be, as described under
"-- Merger, Amalgamation, Consolidation and Assumption" above;
- add covenants and events of default for the protection of the holders of
all or any particular series of debt securities;
- change or eliminate any of the provisions of the indentures, provided
that any such change or elimination shall become effective only after
there are no debt securities of any series entitled to the benefit of
such provision outstanding;
- establish the forms or terms of debt securities of any series;
- cure any ambiguity or correct any inconsistency in the indentures; or
- evidence the acceptance of appointment by a successor trustee.
The indentures and the guarantee agreement also contain provisions
permitting the issuer, the guarantor, if any, and the trustee to add any
provisions to, or change in any manner or eliminate any of the provisions of,
the indentures or the guarantee agreement, as the case may be, or modify in any
manner the rights of the holders of such debt securities with the consent of the
affected holders of at least a majority in principal amount of all series of
debt securities then outstanding, with each such series voting as a separate
class. However, the issuer, the guarantor, if any, and the trustee may not,
without the consent of the affected holder of each outstanding debt security:
- change the stated maturity of the principal of or any installment of
interest on any debt security;
- reduce the principal amount;
- reduce the rate of interest;
16
- change the place of payment where, or the coin or currency in which,
interest is payable;
- impair the right to institute suit for the enforcement of any payment
when due;
- reduce the percentage in principal amount of debt securities requiring
consent of holders for any modification; or
- release the guarantee, if any, except in compliance with the terms of the
guarantee agreement and the indenture.
BOOK-ENTRY DEBT SECURITIES -- REGISTRATION, TRANSFER, EXCHANGE AND PAYMENT
The issuer intends to issue each series of its debt securities in
"book-entry" form, represented by one or more global certificates registered in
the name of The Depository Trust Company, New York, New York ("DTC"), or its
nominee. However, the issuer reserves the right to issue debt securities in
certificate form registered in the names of the holders of the debt securities.
Ownership of beneficial interests in the global certificates representing
the particular series of debt securities will be limited to persons who have
accounts with DTC ("participants"), or persons that may hold interests through
participants. DTC will keep on its computerized book-entry and transfer system a
record of the principal amounts of debt securities held in the accounts of the
participants. Participants, in turn, will keep records of the interests of their
clients who have purchased debt securities through them. Beneficial interests in
the global certificates may be shown only on, and may be transferred only
through, records maintained by DTC and its participants. The laws of some states
require that certain purchasers of securities take delivery of the securities
only in certificate form. These laws may limit the ability of holders of
beneficial interests in the global certificates to transfer those interests to
certain persons who might otherwise wish to purchase those interests.
DTC has provided the issuer the following information: DTC is a
limited-purpose trust company organized under the New York Banking Law, a
"banking organization" within the meaning of the New York Banking Law, a member
of the United States Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code and a "clearing agency"
registered under the provisions of Section 17A of the Securities Exchange Act of
1934. DTC holds securities that its participants deposit with DTC. DTC also
records the settlement among participants of securities transactions, such as
transfers and pledges, in deposited securities through computerized records for
participants' accounts. This eliminates the need to exchange certificates.
Participants include securities brokers and dealers, banks, trust companies,
clearing corporations and certain other organizations.
DTC's book-entry system is also used by other organizations such as
securities brokers and dealers, banks and trust companies that work through a
participant. The rules that apply to DTC and its participants are on file with
the SEC.
DTC is owned by a number of its participants and by the New York Stock
Exchange, Inc., The American Stock Exchange, Inc. and the National Association
of Securities Dealers, Inc.
Payments of interest and principal will be made to DTC, who in turn will
credit payment to the accounts of its participants. It is DTC's current
practice, upon receipt of any payment of principal or interest, to credit
participants' accounts on the payment date according to their respective
holdings of beneficial interests in the global certificates as shown on DTC's
records. In addition, it is DTC's current practice to assign any consenting or
voting rights to participants
17
whose accounts are credited with certificates on a record date, by using an
omnibus proxy. Payments by participants to holders of beneficial interests in
the global certificates, and voting by participants, will be governed by the
customary practices between the participants and holders of beneficial
interests, as is the case with securities held for the account of customers
registered in "street names."
The issuer, the trustee and the paying agent will treat DTC as the sole
owner of the global certificates for all purposes. Accordingly, the issuer, the
trustee and any paying agent will have no responsibility or liability:
- for the records relating to beneficial ownership interests in the global
certificates; or
- for the payments of principal and interest due for the accounts of
beneficial holders of interest in the global certificates.
Unless the issuer decides to issue the debt securities in certificate form,
the global certificates representing a series of debt securities may not be
transferred. However, a global certificate may be transferred by DTC to its
nominees or successors.
A series of debt securities represented by global certificates will be
exchangeable for debt securities in certificate form with the same terms in
authorized denominations only if:
- DTC notifies the issuer that it is unwilling or unable to continue as
depositary or if DTC ceases to be a clearing agency registered under
applicable law, and we do not appoint a successor depositary within 90
days; or
- The issuer decides not to require all of the debt securities of a series
to be represented by global certificates and notifies the trustee of that
decision.
The issuer has obtained the foregoing information concerning DTC and DTC's
book-entry system from DTC and other sources it believes reliable, but we take
no responsibility for the accuracy of this information.
APPLICABLE LAW
The debt securities and the indentures will be governed by and construed in
accordance with the law of the State of New York.
TRUSTEE
Citibank, N.A. is the trustee under the indentures for Burlington
Resources' and Burlington Resources Finance Company's senior debt securities and
Burlington Resources' subordinated debt securities. Citibank, N.A. serves as
trustee under various indentures relating to our obligations. We have customary
banking relationships with Citibank, N.A., including its participation as one of
the agent banks in our revolving credit agreements.
18
DESCRIPTION OF CAPITAL STOCK OF
BURLINGTON RESOURCES
Burlington Resources' certificate of incorporation authorizes the issuance
of 325,000,000 shares of common stock and 75,000,000 shares of preferred stock,
of which 3,250,000 shares are designated Series A Junior Participating Preferred
Stock. Burlington Resources has two outstanding classes of securities that
entitle holders to vote generally at meetings of the Company's stockholders:
common stock, par value $.01 per share; and special voting stock, par value $.01
per share. A single share of special voting stock was issued to CIBC Mellon
Trust Company, as trustee under a voting and exchange trust agreement for the
benefit of holders of exchangeable shares issued by our wholly-owned subsidiary,
Burlington Resources Canada Inc., in connection with Burlington Resources'
November 1999 acquisition of Poco Petroleums Ltd. The common stock and the
voting share vote together as a single class on all matters except when Delaware
law requires otherwise. Each share of common stock outstanding is entitled to
one vote. The voting share is entitled to one vote for each exchangeable share
outstanding (other than those held by Burlington Resources or any entity
controlled by it). The trustee is required to vote the voting share in the
manner that holders of exchangeable shares instruct, and to abstain from voting
in proportion to the exchangeable shares for which the trustee does not receive
instructions. As of March 31, 2001, there were 211,493,213 shares of common
stock outstanding held by approximately 17,879 holders of record, excluding
holders whose shares of record are held by brokers. As of March 31, 2001,
3,752,831 exchangeable shares were outstanding and entitled to give voting
instructions to the trustee. As of the date of this prospectus, there were no
shares of preferred stock issued or outstanding except for the special voting
stock. Because the following description of our capital stock is a summary, it
does not contain all the information that may be important to you. You should
read the following documents for more complete information:
- Burlington Resources' certificate of incorporation, as amended;
- Burlington Resources' by-laws, as amended; and
- the Rights Agreement, effective December 16, 1998, as amended, between
Burlington Resources and BankBoston, N.A., as Rights Agent.
COMMON STOCK
The holders of common stock are entitled to one vote for each share held of
record on all matters submitted to a vote of stockholders. Subject to
preferences that may be applicable to any outstanding preferred stock, holders
of common stock are entitled to receive ratably any dividends as may be declared
by Burlington Resources' board of directors out of legally available funds. In
the event of Burlington Resources' liquidation, dissolution or winding up,
holders of common stock are entitled to share ratably in all assets remaining
after payment of liabilities and the liquidation preference of any outstanding
preferred stock. Holders of common stock have no preemptive rights and have no
rights to convert their common stock into any other securities and no redemption
provisions apply to the common stock. All of the outstanding shares of common
stock are, and the shares offered hereby will be, fully paid and nonassessable.
19
PREFERRED STOCK
Burlington Resources' certificate of incorporation authorizes its board of
directors to issue shares of preferred stock in one or more series. The board of
directors is authorized to designate, for each series of preferred stock, the
number of shares of such series, the voting powers, if any, of the shares of
such series and the designations, preferences and relative, participating,
optional or other special rights and the qualifications, limitations or
restrictions. You should read the certificate of designation relating to a
particular series of preferred stock for specific terms.
Burlington Resources has no present plans to issue any of the preferred
stock, except as required under the Rights Agreement.
SPECIAL VOTING STOCK
A series of preferred stock, consisting of one share, has been designated
as special voting stock, having a par value of $.01 per share and a liquidation
preference of $.01 per share. Except as otherwise required by law or Burlington
Resources' certificate of incorporation, the one share of special voting stock
possesses a number of votes for the election of directors and on all other
matters submitted to a vote of our shareholders equal to the number of
outstanding exchangeable shares from time to time not owned by Burlington
Resources or any entity controlled by Burlington Resources. The holders of
shares of our common stock and the holder of the special voting stock vote
together as a single class on all matters except when Delaware law otherwise
requires. In the event of any liquidation, dissolution or winding-up of
Burlington Resources, all outstanding exchangeable shares will automatically be
exchanged for shares of Burlington Resources' common stock, and the holder of
the special voting stock will not be entitled to receive any of our assets
available for distribution to its stockholders. The holder of the special voting
stock is not entitled to receive dividends. The one share of special voting
stock has been issued to CIBC Mellon Trust Company, as trustee, under the voting
and exchange trust agreement. At such time as the one share of special voting
stock has no votes attached to it because there are no exchangeable shares
outstanding not owned by Burlington Resources or any entity controlled by
Burlington Resources, the share of special voting stock will be canceled.
RIGHTS AGREEMENT
Each share of common stock currently has a right associated with it.
Generally, each right consists of the right to purchase, for $200, 1/100 of a
share of Burlington Resources Series A Junior Participating Preferred Stock. The
terms of the rights are set forth in the rights agreement.
The rights may be exercised only if the distribution date occurs. The
distribution date is the earlier of either:
- the first date that it is publicly announced that a person or group has
acquired 15% or more of Burlington Resources' voting power; or
- the date that is 10 business days (or a later date selected by our board
of directors) after a person or group begins, or announces an intention
to begin, a tender or exchange offer for 15% or more of Burlington
Resources' voting power.
If a person or group acquires 15% or more of our voting power without the
prior approval of the board of directors, then Burlington Resources'
stockholders, other than the acquiror, will
20
be entitled to purchase, for $200, Burlington Resources common stock, or, in
certain circumstances, cash, property or our other securities, with a market
value equal to $400. This is commonly referred to as the "flip-in" feature of
the rights.
If a person or group acquires 15% or more of Burlington Resources' voting
power without the prior approval of the board of directors and then either
acquires Burlington Resources in a merger or other business combination
transaction or causes the sale or transfer of more than 50% of Burlington
Resources' assets or earning power, then Burlington Resources' stockholders,
other than the acquiror, will be entitled to purchase, for $200, common stock of
the acquiror with a market value equal to $400. This is commonly referred to as
the "flip-over" feature of the rights.
The rights will expire automatically in 10 years, on December 16, 2008, but
Burlington Resources has the option of redeeming or exchanging the rights prior
to that time.
Burlington Resources may redeem all of the rights at any time before a
person or group announces that it has acquired 15% or more of Burlington
Resources' voting power. The circumstances under which Burlington Resources may
redeem the rights are more fully described in the rights agreement. Each right
may be redeemed at the price of $.01 per right. The rights cannot be exercised
until after the redemption period has passed. If Burlington Resources redeems
the rights, the rights will no longer be exercisable and will terminate.
Furthermore, Burlington Resources may exchange all or a portion of the
rights at any time after a person or group acquires 15% or more of Burlington
Resources' voting power, at an exchange ratio of one share of common stock per
right. If the board of directors orders the exchange of the rights, the rights
will no longer be exercisable and will terminate. Until a right is exercised or
exchanged, the holder of that right will not have any rights as a stockholder,
including the right to vote or receive dividends, simply as a result of being a
holder of that right.
Each 1/100 of a share of Series A Junior Participating Preferred Stock that
may be issued upon exercise of a right is intended to be comparable to one share
of common stock with respect to dividend, voting, liquidation and other rights.
The Series A Junior Participating Preferred Stock will rank junior to all other
series of our preferred stock with respect to dividend payments and
distributions of assets in liquidation. The Series A Junior Participating
Preferred Stock will not be redeemable.
PROVISIONS AFFECTING CONTROL OF BURLINGTON RESOURCES
Certificate of Incorporation. Under the Delaware General Corporation Law
(the "DGCL"), the approval by the affirmative vote of the holders of a majority
of the outstanding stock of a corporation entitled to vote on the matter
generally is required for a merger, consolidation or sale, lease or exchange of
all or substantially all the corporation's assets to be consummated. Burlington
Resources' certificate of incorporation provides certain restrictions on
business combinations with interested stockholders or their affiliates.
Accordingly, Burlington Resources' certificate of incorporation requires the
affirmative vote of at least 51% of the voting stock, excluding the vote of any
interested stockholder, for the adoption or authorization of a business
combination unless the disinterested directors determine that:
- the interested stockholder is the beneficial owner of at least 80% of the
voting stock and has agreed to vote in favor of the business combination;
or
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- the fair market value of the consideration per share to be received or
retained by the stockholders in the business combination is equal to or
greater than the consideration per share paid by the interested
stockholder in acquiring the largest number of shares of that class of
stock previously acquired in any one transaction or series of related
transactions and the interested stockholder has not received the benefit
of any loans, advances, guarantees, pledges or other financial assistance
provided by Burlington Resources.
Directors. The DGCL permits the certificate of incorporation or the
by-laws of a corporation to contain provisions governing the number and
qualifications of directors. However, if the certificate of incorporation
contains provisions fixing the number of directors, that number may not be
changed without amending the certificate of incorporation. Burlington Resources'
by-laws state that the number of directors shall be any number not less than
one, determined from time to time by a vote of a majority of the directors then
in office. Pursuant to Burlington Resources' by-laws, directors are elected at
the annual meeting of stockholders for a term of one year.
Amendments to the Certificate of Incorporation. Under the DGCL, a proposed
amendment to the certificate of incorporation requires a resolution adopted by
the board of directors and, unless otherwise provided in the certificate of
incorporation, the affirmative vote of the holders of a majority of the
outstanding stock entitled to vote thereon and (if applicable) the affirmative
vote of the holders of a majority of the outstanding stock of each class
entitled to vote thereon as a class. If any amendment would adversely affect the
rights of any holders of shares of a class or series of stock, the vote of the
holders of a majority of all outstanding shares of the class or series, voting
as a class, is also necessary to authorize the amendment. Burlington Resources'
certificate of incorporation provides that no amendment to the certificate of
incorporation shall amend, alter or repeal the provisions of Article 14 (action
by stockholders without a meeting) or Article 15 (special voting requirements)
without the affirmative vote of not less than 51% of the voting stock (as it is
defined in the certificate of incorporation), excluding the vote of any
interested stockholder.
By-Laws. Under the DGCL, the power to adopt, alter and repeal the by-laws
is vested in the stockholders, except to the extent that a corporation's
certificate of incorporation or by-laws vest it in the board of directors.
However, the conferral of the power to adopt, alter and repeal the by-laws upon
the directors does not divest the stockholders of their power to adopt, amend or
repeal the by-laws. Burlington Resources' certificate of incorporation grants
the board of directors the power to make and alter the by-laws subject to
certain restrictions and the provisions of the by-laws. With certain exceptions
and subject to the power of the stockholders to amend and alter the by-laws, the
by-laws provide that the by-laws may be altered or repealed:
- by the affirmative vote of the holders of a majority of shares present or
represented and entitled to vote at a meeting of stockholders; or
- by the affirmative vote of a majority of the whole board of directors.
Special Meetings. The DGCL provides that a special meeting of stockholders
may be called by the board of directors or by any person or persons authorized
by a corporation's certificate of incorporation or by-laws. Burlington
Resources' by-laws provide that special meetings may be called only by a
majority of the board of directors, the chairman of the board, or the president.
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Written Consent of Stockholders. Under the DGCL, unless otherwise provided
in the corporation's certificate of incorporation, any action required or
permitted to be taken at a meeting of stockholders may be taken without a
meeting, without prior notice and without a vote, if a written consent or
consents setting forth the action taken are signed by the holders of outstanding
stock having not less than the minimum number of votes that would be necessary
to authorize or take such action at a meeting at which all shares entitled to
vote upon such action were present and voted and such votes are delivered to the
corporation. Burlington Resources' certificate of incorporation provides that
any action by stockholders shall be taken at a meeting of stockholders and no
action may be taken by written consent of the stockholders.
Preemptive Rights. Under the DGCL, a stockholder does not have preemptive
rights unless such rights are specifically granted in the corporation's
certificate of incorporation. Burlington Resources' certificate of incorporation
provides that no holder of stock of any class shall have, as such holder, any
preemptive or preferential right with respect to any stock of any class or to
any securities convertible into shares of stock.
Delaware Business Combination Law. Section 203 of the DGCL generally
prohibits a Delaware corporation from engaging in a business combination
(defined as a variety of transactions, including mergers, asset sales, issuance
of stock and other transactions resulting in a financial benefit to the
interested stockholder) with an "interested stockholder" (defined generally as a
person that is the beneficial owner of 15% or more of a corporation's
outstanding voting stock) for a period of three years following the date that
such person became an interested stockholder unless:
- prior to the date such person became an interested stockholder, the board
of directors of the corporation approved either the business combination
or the transaction that resulted in the stockholder's becoming an
interested stockholder;
- upon consummation of the transaction that resulted in the stockholder
becoming an interested stockholder, the interested stockholder owned at
least 85% of the voting stock of the corporation outstanding at the time
the transaction commenced, excluding stock held by directors who are also
officers of the corporation and employee stock ownership plans that do
not provide employees with the right to determine confidentially whether
shares held subject to the plan will be tendered in a tender or exchange
offer; or
- on or subsequent to the date such person became an interested
stockholder, the business combination is approved by the board of
directors of the corporation and authorized at a meeting of stockholders,
and not by written consent, by the affirmative vote of the holders of at
least 66 2/3% of the outstanding voting stock of the corporation not
owned by the interested stockholder.
A corporation may adopt an amendment to its certificate of incorporation or
by-laws expressly electing not to be governed by Section 203 of the DGCL if, in
addition to any other vote required by law, the amendment is approved by the
affirmative vote of a majority of the shares entitled to vote. However, the
amendment generally will not be effective until 12 months after its adoption and
will not apply to a business combination with an interested stockholder who was
such on or prior to the adoption of the amendment. Burlington Resources has not
adopted an amendment to its certificate of incorporation or by-laws by which it
elects not to be governed by Section 203 of the DGCL.
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DESCRIPTION OF TRUST PREFERRED
SECURITIES AND TRUST GUARANTEES
TRUST PREFERRED SECURITIES
Each declaration of trust will authorize its trustees to issue one series
of trust preferred securities and one series of trust common securities
(together, the "trust securities"). Each declaration will be qualified as an
indenture under the Trust Indenture Act.
The trust preferred securities will have the terms set forth in the
applicable declaration or made part of the declaration by the Trust Indenture
Act. You should read the prospectus supplement relating to the particular trust
preferred securities of a trust for specific terms, including:
- the distinctive designation of trust preferred securities;
- the number of trust preferred securities to be issued;
- the annual distribution rate (or method of determining such rate) for
trust preferred securities and the date or dates upon which such
distributions will be payable;
- whether distributions on trust preferred securities will be cumulative,
and, in the case of trust preferred securities having cumulative
distribution rights, the date or dates or method of determining the date
or dates from which distributions on the securities will be cumulative;
- the amount or amounts which will be paid out of the assets of the trust
to the holders of trust preferred securities upon voluntary or
involuntary dissolution, winding-up or termination of the trust;
- any conversion or exchange provisions applicable to the trust preferred
securities;
- the terms and conditions, if any, upon which the related series of the
applicable subordinated debt securities may be distributed to holders of
trust preferred securities;
- the obligation, if any, of the Burlington Resources trust to purchase or
redeem the trust preferred securities it issued and the price or prices
at which, the period or periods within which and the terms and conditions
upon which these securities will be purchased or redeemed, in whole or in
part, pursuant to such obligation;
- the voting rights, if any, of trust preferred securities in addition to
those required by law, including the number of votes per trust preferred
security and any requirement for the approval by the holders of trust
preferred securities as a condition to specified action or amendments to
the declaration of the trust; and
- any other specific terms of the trust preferred securities.
Pursuant to each declaration, the property trustee will own the
subordinated debt securities purchased by the applicable trust for the benefit
of the holders of the trust preferred securities. Burlington Resources will
guarantee to the extent described under the heading "-- Trust Guarantees" the
payment of distributions out of money held by the trusts and payments upon
redemption of trust preferred securities or liquidation of any trust.
The material federal income tax considerations applicable to an investment
in trust preferred securities will be described in the prospectus supplement
relating thereto.
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TRUST COMMON SECURITIES
In connection with the issuance of trust preferred securities, each
Burlington Resources trust will also issue one series of trust common
securities. Each declaration of trust authorizes the administrative trustee of a
trust to issue on behalf of the trust one series of trust common securities with
the terms set forth in the declaration of trust. Except as otherwise provided in
the prospectus supplement relating to the trust preferred securities, the terms
of the trust common securities will be substantially identical to the terms of
each trust preferred security. The trust common securities will rank equally and
payments will be made pro rata with the trust preferred securities. However,
upon an event of default under the indenture governing the subordinated debt
securities, the rights of the holders of the trust common securities to payment
in respect of distributions and payments upon liquidation, redemption and
otherwise will be subordinated to the rights of the holders of the trust
preferred securities. Except in limited circumstances, the trust common
securities will also carry the right to vote and to appoint, remove or replace
any of the trustees of a trust. Burlington Resources will own, directly or
indirectly, all of the trust common securities of each trust.
TRUST GUARANTEES
Set forth below is a summary of information concerning the trust guarantees
that Burlington Resources will execute and deliver for the benefit of the
holders of trust preferred securities of the respective trusts. The accompanying
prospectus supplement will describe any significant differences between the
actual terms of the trust guarantees and the summary below. Because this is a
summary, it does not contain all of the information in the trust guarantee. You
should read the entire trust guarantee, which will be filed with the SEC and
incorporated by reference as an exhibit to the registration statement of which
this prospectus forms a part.
General. Burlington Resources will irrevocably and unconditionally agree,
to the extent set forth in the trust guarantee, to pay in full, to the holders
of trust securities as and when due, regardless of any defense, right of set-off
or counterclaim which the applicable trust may have or assert:
- any accrued and unpaid distributions required to be paid on the trust
securities, to the extent the trust has available funds at such time;
- the redemption price, including all accrued and unpaid distributions,
payable out of available funds with respect to any trust securities
called for redemption by the trust; and
- if Burlington Resources liquidates the trust, except in connection with
the distribution of subordinated debt securities to the holders of trust
securities or the redemption of all of the trust securities issued by the
trust, the lesser of
- the aggregate of the liquidation preference and all accrued and unpaid
distributions on the trust securities of the series to the date of
payment and
- the amount of assets of the trust remaining available for distribution
to holders of trust securities of the series in liquidation.
Burlington Resources's obligation to make a trust guarantee payment may be
satisfied by direct payment of the required amounts by us to the holders of
trust securities or by causing the applicable trust to pay the required amounts
to the holders.
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Amendments and Assignment. Generally, the trust guarantee with respect to
any series of trust securities may be changed only with the prior approval of
the holders of at least a majority in liquidation preference of the outstanding
trust preferred securities of the series. However, if the changes do not
adversely affect the rights of holders of trust preferred securities of any
series in any material respect, no vote will be required. We will describe the
manner of obtaining any approval of holders of the trust preferred securities of
each series in an accompanying prospectus supplement. All guarantees and
agreements contained in each trust guarantee shall bind Burlington Resources'
successors, assigns, receivers, trustees and representatives and will be for the
benefit of the holders of the applicable series of trust preferred securities
then outstanding.
Termination of the Trust Guarantees. Each trust guarantee will terminate
as to the trust preferred securities issued by the applicable trust upon:
- full payment of the redemption price of all trust securities of the
trust;
- distribution of the subordinated debt securities held by the trust to the
holders of the trust securities of the trust; or
- full payment of the amounts payable in accordance with the declaration of
the trust upon liquidation of the trust.
Each trust guarantee will continue to be effective or will be reinstated,
as the case may be, if at any time any holder of trust preferred securities
issued by the applicable trust must restore payment of any sums paid under the
trust preferred securities or the trust guarantee. The subordination provisions
of the subordinated debt securities and the trust guarantees, respectively, will
provide that in the event payment is made on the subordinated debt securities or
the trust guarantees in contravention of such provisions such payments will be
paid over to the holders of senior indebtedness.
Ranking of the Trust Guarantee. Each trust guarantee will constitute
Burlington Resources' unsecured obligation and will rank:
- subordinate and junior in right of payment to all of Burlington
Resources' other liabilities;
- equally with the most senior preferred or preference stock, if any,
hereafter issued by Burlington Resources and with any guarantee hereafter
entered into by Burlington Resources in respect of any preferred or
preference stock or interests of any affiliate of Burlington Resources;
and
- senior to the common stock.
Each declaration will provide that each holder of trust securities by
accepting the security agrees to the subordination provisions and other terms of
the applicable trust guarantee.
Each trust guarantee will constitute a guarantee of payment and not of
collection. The trust guarantee will be deposited with the property trustee to
be held for the benefit of any series of trust securities. The property trustee
will have the right to enforce the trust guarantee on behalf of the holders of
any series of trust securities. The holders of not less than a majority in
aggregate liquidation preference of a series of trust preferred securities will
have the right to direct the time, method and place of conducting any proceeding
for any remedy available in respect of the trust guarantee applicable to the
series of trust preferred securities, including giving directions to the
property trustee. If the property trustee fails to enforce the trust
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guarantee, any holder of trust securities of a series to which the trust
guarantee pertains may institute a legal proceeding directly against Burlington
Resources to enforce its rights under the trust guarantee, without first
instituting a legal proceeding against the trust, or any other person or entity.
Each trust guarantee will not be discharged except by payment of the trust
guarantee payments in full to the extent not paid by the applicable trust, and
by complete performance of all obligations under such trust guarantee.
Governing Law. Each trust guarantee will be governed by and construed in
accordance with the laws of the State of New York.
PLAN OF DISTRIBUTION
We may sell the securities:
- through underwriters or dealers;
- through agents;
- directly to purchasers; or
- through a combination of any such methods of sale.
Any underwriter, dealer or agent may be deemed to be an underwriter within
the meaning of the Securities Act. The prospectus supplement relating to any
offering of securities will set forth their offering terms, including the name
or names of any underwriters, the purchase price of the securities and the
proceeds to us from such sale, any underwriting discounts, commissions and other
items constituting underwriters' compensation, any initial public offering
price, and any underwriting discounts, commissions and other items allowed or
reallowed or paid to dealers, and any securities exchanges on which the
securities may be listed. Only underwriters so named in the prospectus
supplement are deemed to be underwriters in connection with the securities
offered hereby.
If underwriters are used in the sale, they will acquire the securities for
their own account and may resell them from time to time in one or more
transactions, at a fixed price or prices, which may be changed, or at market
prices prevailing at the time of sale, or at prices related to such prevailing
market prices, or at negotiated prices. The securities may be offered to the
public either through underwriting syndicates represented by one or more
managing underwriters or directly by one or more of such firms. Unless otherwise
set forth in the prospectus supplement, the obligations of the underwriters to
purchase the securities will be subject to certain conditions precedent and the
underwriters will be obligated to purchase all the offered securities if any are
purchased. Any initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers may be changed from time to time.
Any agent involved in the offer or sale of the securities in respect of
which this prospectus is delivered will be named, and any commissions payable by
us to the agent will be set forth, in the accompanying prospectus supplement.
Unless otherwise indicated in the prospectus supplement, any such agent will be
acting on a best efforts basis for the period of its appointment.
If so indicated in the prospectus supplement, we will authorize
underwriters, dealers or agents to solicit offers by certain specified
institutions to purchase securities from us at the public offering price set
forth in the accompanying prospectus supplement pursuant to delayed delivery
contracts providing for payment and delivery on a specified date in the future.
These
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contracts will be subject to any conditions set forth in the accompanying
prospectus supplement and the prospectus supplement will set forth the
commission payable for solicitation of these contracts. The underwriters and
other persons soliciting these contracts will have no responsibility for the
validity or performance of any such contracts.
Securities offered may be a new issue of securities with no established
trading market. Any underwriters to whom or agents through whom these securities
are sold by us for public offering and sale may make a market in these
securities, but such underwriters or agents will not be obligated to do so and
may discontinue any market making at any time without notice. No assurance can
be given as to the liquidity of or the trading market for any such securities.
Underwriters, dealers and agents may be entitled, under agreements entered
into with us, to indemnification by Burlington Resources, the Burlington
Resources trusts and/or Burlington Resources Finance Company against certain
civil liabilities, including liabilities under the Securities Act or to
contribution by us to payments they may be required to make in respect thereof.
Certain of the underwriters, agents or dealers and their associates may be
customers of, or engage in transactions with and perform services for us in the
ordinary course of business.
LEGAL MATTERS
The legality of the debt and equity securities of Burlington Resources
other than the guarantees of the trust securities will be passed upon for us by
Cahill Gordon & Reindel, New York, New York, and for the underwriters, dealers
or agents by Cravath, Swaine & Moore, New York, New York. The legality of the
trust securities will be passed upon for us by Richards, Layton & Finger, P.A.
The legality of the debt securities of Burlington Resources Finance Company will
be passed upon for us by Bennett Jones LLP, Calgary, Alberta, Canada, and Cahill
Gordon & Reindel. Kenneth W. Orce, a member of Burlington Resources' board of
directors, is a senior partner of Cahill Gordon & Reindel and, as of March 31,
2001, beneficially owned 34,877 shares of Burlington Resources common stock,
including 22,252 currently exercisable options.
EXPERTS
The audited financial statements incorporated by reference in the
registration statement of which this prospectus is a part, except as they relate
to Burlington Resources Canada Energy Ltd. (formerly Poco Petroleums Ltd.), have
been audited by PricewaterhouseCoopers LLP, independent accountants, and,
insofar as they relate to Burlington Resources Canada Energy Ltd., by KPMG LLP,
independent accountants. Such financial statements have been so incorporated in
reliance on the reports of such independent accountants given on the authority
of such firms as experts in auditing and accounting.
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