AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 13, 2002
REGISTRATION NOS. 333-
333- -01
333- -02
333- -03
333- -04
- --------------------------------------------------------------------------------
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
CONOCOPHILLIPS DELAWARE 01-0562944
CONOCO INC. DELAWARE 51-0370352
PHILLIPS PETROLEUM COMPANY DELAWARE 73-0400345
CONOCOPHILLIPS TRUST I DELAWARE APPLIED FOR
CONOCOPHILLIPS TRUST II DELAWARE APPLIED FOR
(Exact name of each registrant (State of (I.R.S. Employer
as specified in its charter) Incorporation) Identification Number)
600 NORTH DAIRY ASHFORD
HOUSTON, TEXAS 77079
(281) 293-1000
(Address, including zip code, and telephone number,
including area code, of each registrant's principal executive offices)
RICK A. HARRINGTON
SENIOR VICE PRESIDENT, LEGAL,
AND GENERAL COUNSEL
CONOCOPHILLIPS
600 NORTH DAIRY ASHFORD
HOUSTON, TEXAS 77079
(281) 293-1000
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
COPY TO:
KELLY B. ROSE
BAKER BOTTS L.L.P.
910 LOUISIANA
HOUSTON, TEXAS 77002-4995
(713) 229-1234
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are to be offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, as amended (the "Securities Act"), other than securities offered only
in connection with dividend or interest reinvestment plans, check the following
box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AGGREGATE
SECURITIES TO BE REGISTERED OFFERING PRICE AMOUNT OF
(1)(2)(3) REGISTRATION FEE
------------------ ----------------
Senior Debt Securities and Subordinated Debt Securities of ConocoPhillips....
Common Stock, par value $0.01 per share, of ConocoPhillips(4)................
Preferred Stock, par value $0.01 per share, of ConocoPhillips................
Warrants of ConocoPhillips...................................................
Depositary Shares of ConocoPhillips..........................................
Stock Purchase Contracts of ConocoPhillips...................................
Stock Purchase Units of ConocoPhillips.......................................
Prepaid Stock Purchase Contracts of ConocoPhillips...........................
Preferred Securities of ConocoPhillips Trust I and ConocoPhillips Trust II...
Guarantees of Preferred Securities of ConocoPhillips Trust I and
ConocoPhillips Trust II by ConocoPhillips...............................
Guarantees of the Senior Debt Securities of ConocoPhillips by Conoco Inc.
and Phillips Petroleum Company..........................................
Total............................................................... $5,000,000,000 $460,000 (5)
(1) Estimated solely for the purpose of computing the registration fee pursuant
to Rule 457(o) under the Securities Act and exclusive of accrued interest,
distributions and dividends, if any. In no event will the aggregate initial
offering price of all securities issued from time to time pursuant to this
Registration Statement exceed $5,000,000,000 or the equivalent thereof in
foreign currencies, foreign currency units or composite currencies. If any
debt securities are issued at an original issue discount, then the offering
price shall be in such greater principal amount as shall result in an
aggregate initial offering price of up to $5,000,000,000 or the equivalent
thereof in foreign currencies, foreign currency units or composite
currencies, less the dollar amount of any securities previously issued
hereunder. Any securities registered hereunder may be sold separately or as
units with other securities registered hereunder.
(2) There is being registered hereunder such indeterminate number or amount of
senior and subordinated debt securities, common stock, preferred stock,
warrants, depositary shares, stock purchase contracts, stock purchase units
and prepaid stock purchase contracts of ConocoPhillips and preferred
securities of ConocoPhillips Trust I and ConocoPhillips Trust II as may
from time to time be issued at indeterminate prices and as may be issuable
upon conversion, redemption, exchange, exercise or settlement of any
securities registered hereunder, including under any applicable
antidilution provisions. Senior and subordinated debt securities of
ConocoPhillips may be issued and sold to ConocoPhillips Trust I and
ConocoPhillips Trust II, in which event such debt securities may later be
distributed to the holders of preferred securities upon a dissolution of
ConocoPhillips Trust I and ConocoPhillips Trust II and the distribution of
their respective assets.
(3) ConocoPhillips also is registering under this Registration Statement all
guarantees and other obligations that it may have with respect to preferred
securities that may be issued by ConocoPhillips Trust I and ConocoPhillips
Trust II. Conoco Inc. and Phillips Petroleum Company are registering under
this Registration Statement all guarantees and other obligations that they
may have with respect to the senior debt securities that may be issued by
ConocoPhillips. No separate consideration will be received for such
guarantees or any other such obligations. Pursuant to Rule 457(n) under the
Securities Act, no registration fee is required with respect to such
guarantees or obligations.
(4) Each share of common stock includes one preferred share purchase right. No
separate consideration is payable for the preferred share purchase rights.
The registration fee for these securities is included in the fee for the
common stock.
(5) Pursuant to Rule 457(p) under the Securities Act, ConocoPhillips hereby
offsets the registration fee required in connection with this Registration
Statement by a total of $460,000, consisting of (1) $375,000 previously
paid by Conoco Inc. and Conoco Funding Company, wholly owned subsidiaries
of ConocoPhillips, in connection with the registration of $1,500,000,000
aggregate initial offering price of securities of Conoco and Conoco Funding
pursuant to the Registration Statement on Form S-3 (Registration Nos.
333-69198 and 333-69198-01) initially filed with the Securities and
Exchange Commission on September 10, 2001; and (2) $85,000 previously paid
by Phillips Petroleum Company and certain Delaware statutory trusts of
Phillips, each of which are wholly owned subsidiaries of ConocoPhillips, in
connection with the registration of $321,969,697 aggregate initial offering
price of securities of Phillips and such trusts pursuant to the
Registration Statement on Form S-3 (Registration Nos. 333-34336,
333-34336-01, 333-34336-02, 333-34336-03 and 333-34336-04) initially filed
with the Securities and Exchange Commission on April 7, 2000. Accordingly,
no filing fee is paid herewith.
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON
SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY
DETERMINE.
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities, and it is not soliciting an offer to buy these
securities, in any state where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED NOVEMBER 13, 2002
PROSPECTUS
[Logo of ConocoPhillips]
$5,000,000,000
CONOCOPHILLIPS CONOCOPHILLIPS CONOCOPHILLIPS TRUST I
SUBORDINATED DEBT SECURITIES SENIOR DEBT SECURITIES CONOCOPHILLIPS TRUST II
COMMON STOCK GUARANTEED AS DESCRIBED IN TRUST PREFERRED SECURITIES
PREFERRED STOCK THIS PROSPECTUS BY GUARANTEED AS DESCRIBED IN THIS
WARRANTS CONOCO INC. PROSPECTUS BY
DEPOSITARY SHARES AND CONOCOPHILLIPS
STOCK PURCHASE CONTRACTS OR UNITS PHILLIPS PETROLEUM COMPANY
PREPAID STOCK PURCHASE CONTRACTS
We will provide the specific terms of the securities in supplements to
this prospectus. You should read this prospectus and any supplement
carefully before you invest. ConocoPhillips common
stock is traded on the New York Stock Exchange under the
trading symbol "COP."
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED WHETHER
THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this prospectus is ,
TABLE OF CONTENTS
About This Prospectus........................................................................................... 2
About ConocoPhillips............................................................................................ 2
About Conoco and Phillips....................................................................................... 2
About the ConocoPhillips Trusts................................................................................. 2
Where You Can Find More Information............................................................................. 3
Forward-Looking Information..................................................................................... 5
Use of Proceeds................................................................................................. 6
Ratio of Earnings to Fixed Charges and Earnings to Combined Fixed Charges and Preferred Stock Dividends......... 6
Description of the Debt Securities.............................................................................. 7
Description of Capital Stock.................................................................................... 17
Description of Warrants......................................................................................... 23
Description of Depositary Shares................................................................................ 24
Description of Stock Purchase Contracts and Stock Purchase Units................................................ 26
Description of the Trust Preferred Securities................................................................... 27
Plan of Distribution............................................................................................ 33
Legal Matters................................................................................................... 35
Experts......................................................................................................... 35
ABOUT THIS PROSPECTUS
This prospectus is part of a joint registration statement that we have
filed with the U.S. Securities and Exchange Commission using a "shelf"
registration process. Using this process, we may offer any combination of the
securities described in this prospectus in one or more offerings with a total
initial offering price of $5,000,000,000. This prospectus provides you with a
general description of the securities we may offer. Each time we use this
prospectus to offer securities, we will provide a prospectus supplement and, if
applicable, a pricing supplement that will describe the specific terms of the
offering. The prospectus supplement and any pricing supplement may also add to,
update or change the information contained in this prospectus. Please carefully
read this prospectus, the prospectus supplement and any pricing supplement, in
addition to the information contained in the documents we refer to under the
heading "Where You Can Find More Information."
ABOUT CONOCOPHILLIPS
ConocoPhillips is the third largest U.S. integrated energy company based
on market capitalization, oil and gas reserves and production, and was formed
through the combination of the businesses of Conoco Inc. and Phillips Petroleum
Company in August 2002. ConocoPhillips is involved in exploring for and
developing, producing and selling crude oil, natural gas and natural gas
liquids; refining crude oil and other feedstocks into petroleum products; buying
and selling crude oil and refined products; transporting, distributing and
marketing petroleum products; and manufacturing and distributing chemicals.
ConocoPhillips is also engaged in developing and operating power facilities.
ConocoPhillips' principal executive office is located at 600 North Dairy
Ashford, Houston, Texas 77079, telephone (281) 293-1000.
ABOUT CONOCO AND PHILLIPS
Conoco Inc. and Phillips Petroleum Company are wholly owned subsidiaries
of ConocoPhillips. Their principal executive offices are located at 600 North
Dairy Ashford, Houston, Texas 77079, telephone (281) 293-1000.
ABOUT THE CONOCOPHILLIPS TRUSTS
ConocoPhillips has formed two Delaware statutory trusts, ConocoPhillips
Trust I and ConocoPhillips Trust II, to raise capital for ConocoPhillips by
issuing preferred securities under this prospectus and investing the proceeds in
debt securities issued by ConocoPhillips. Unless we inform you otherwise in the
prospectus supplement relating to an offering of trust preferred securities,
each trust will exist solely for the purposes of:
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- issuing and selling its trust preferred securities and trust common
securities;
- investing the proceeds from the sale of those securities in a
specific series of ConocoPhillips' debt securities; and
- engaging in only such other activities as are necessary or
incidental to issuing its securities and purchasing and holding
ConocoPhillips' debt securities.
The trust preferred securities and the trust common securities of each
trust will represent undivided beneficial interests in the assets of that trust.
ConocoPhillips will directly or indirectly own all of the common securities of
each trust. The common securities of each trust will represent an aggregate
liquidation amount equal to at least three percent of the total capital of that
trust. The common securities of each trust will rank equally with, and each
trust will make payments on its common securities in proportion to, the trust
preferred securities it issues. If, however, an event of default occurs under
the declaration of trust of any of the trusts, including a default under the
related series of ConocoPhillips' debt securities, ConocoPhillips' right to
payments on the common securities of that trust will be subordinated to your
rights as holder of its trust preferred securities.
The business and affairs of each trust will be conducted by its trustees.
As the holder of the common securities of each trust, ConocoPhillips is
entitled, except in limited circumstances, to appoint, and may remove or
replace, the trustees. ConocoPhillips may increase or decrease the number of
trustees for each trust, but each trust must have at least three trustees.
The duties and obligations of the trustees of each trust are governed by
its declaration of trust. Prior to the issuance of any trust preferred
securities by a trust, we will ensure that at least one of ConocoPhillips'
officers, employees or affiliates acts as regular trustee and that a financial
institution unaffiliated with us acts as property trustee and indenture trustee
for purposes of the Trust Indenture Act of 1939. In addition, unless the
property trustee of a trust maintains a principal place of business in Delaware
and meets the other requirements of applicable law, another trustee of that
trust will have its principal place of business or reside in Delaware. We will
appoint The Bank of New York to serve as property trustee for the trusts and The
Bank of New York (Delaware) to serve as Delaware trustee for the trusts.
ConocoPhillips will pay all of the fees and expenses of each trust,
including those related to any offering of trust preferred securities. In
addition, ConocoPhillips will provide a guarantee with respect to each series of
trust preferred securities issued by a trust under which ConocoPhillips will
unconditionally and irrevocably agree to make certain payments to the holders of
that series of trust preferred securities. That guarantee may, however, be
subject to applicable subordination provisions and will apply only when the
relevant trust has sufficient immediately available funds but fails to make the
payments.
We will provide further information about the trusts in the prospectus
supplement relating to an offering of trust preferred securities.
The principal office of each trust is c/o ConocoPhillips, 600 North Dairy
Ashford, Houston, Texas 77079, telephone (281) 293-1000.
WHERE YOU CAN FIND MORE INFORMATION
ConocoPhillips files, and Conoco and Phillips have filed, annual,
quarterly and current reports, proxy statements and other information with the
SEC. You can read and copy these materials at the SEC's public reference room at
450 Fifth Street, N.W., Washington, D.C. 20549. You can obtain information about
the operation of the SEC's public reference room by calling the SEC at
1-800-SEC-0330. The SEC also maintains an Internet site that contains
information ConocoPhillips, Conoco and Phillips have filed electronically with
the SEC, which you can access over the Internet at http://www.sec.gov. You can
also obtain information about ConocoPhillips at the offices of the New York
Stock Exchange, 20 Broad Street, New York, New York 10005. Conoco, Phillips and
the trusts are not subject to the information reporting requirements of the
Securities Exchange Act of 1934.
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This prospectus is part of a joint registration statement we have filed
with the SEC relating to the securities we may offer. As permitted by SEC rules,
this prospectus does not contain all of the information we have included in the
registration statement and the accompanying exhibits and schedules we file with
the SEC. You may refer to the registration statement, exhibits and schedules for
more information about us and the securities. The registration statement,
exhibits and schedules are available at the SEC's public reference room or
through its Internet site.
The SEC allows us to "incorporate by reference" the information
ConocoPhillips, Conoco and Phillips have filed with it, which means that we can
disclose important information to you by referring you to those documents. The
information we incorporate by reference is an important part of this prospectus,
and later information that ConocoPhillips, Conoco or Phillips files with the SEC
will automatically update and supersede this information. We incorporate by
reference the documents listed below and any future filings ConocoPhillips,
Conoco or Phillips makes with the SEC under Sections 13(a), 13(c), 14 or 15(d)
of the Exchange Act until all the offered securities are sold. The documents we
incorporate by reference are:
- Conoco's Annual Report on Form 10-K for the year ended December 31,
2001, as filed with the SEC on March 15, 2002;
- Phillips' Annual Report on Form 10-K for the year ended December 31,
2001, as filed with the SEC on March 20, 2002, and as amended by
Form 10-K/A filed with the SEC on June 24, 2002;
- Conoco's Quarterly Reports on Form 10-Q for the quarter ended March
31, 2002, as filed with the SEC on May 8, 2002, and for the quarter
ended June 30, 2002, as filed with the SEC on August 9, 2002;
- Phillips' Quarterly Reports on Form 10-Q for the quarter ended March
31, 2002, as filed with the SEC on May 14, 2002, and for the quarter
ended June 30, 2002, as filed with the SEC on August 12, 2002;
- ConocoPhillips' Current Reports on Form 8-K as filed with the SEC on
August 30, 2002 (as amended by Form 8-K/A filed with the SEC on
October 1, 2002) and October 8, 2002;
- Conoco's Current Reports on Form 8-K as filed with the SEC on
February 25, 2002; February 26, 2002; March 12, 2002; August 16,
2002; and August 30, 2002;
- Phillips' Current Reports on Form 8-K as filed with the SEC on
February 25, 2002; February 26, 2002; March 12, 2002; and August 30,
2002; and
- the description of ConocoPhillips common stock (including the
related preferred share purchase rights) contained in
ConocoPhillips' Current Report on Form 8-K as filed with the SEC on
August 30, 2002, as that description may be updated from time to
time.
You may request a copy of these filings, other than an exhibit to these
filings unless we have specifically incorporated that exhibit by reference into
the filing, at no cost, by writing or telephoning ConocoPhillips at the
following address:
ConocoPhillips
Shareholder Relations Department
P. O. Box 2197
Houston, Texas 77079-2197
Telephone: (281) 293-6800
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS, THE PROSPECTUS SUPPLEMENT AND ANY PRICING
SUPPLEMENT. WE HAVE NOT AUTHORIZED ANY PERSON, INCLUDING ANY SALESMAN OR BROKER,
TO PROVIDE INFORMATION OTHER THAN THAT PROVIDED IN THIS PROSPECTUS, THE
PROSPECTUS SUPPLEMENT OR ANY PRICING SUPPLEMENT. WE HAVE NOT AUTHORIZED ANYONE
TO PROVIDE YOU WITH DIFFERENT INFORMATION. WE ARE NOT MAKING AN OFFER OF THE
SECURITIES IN ANY JURISDICTION WHERE THE OFFER IS NOT PERMITTED. YOU SHOULD
ASSUME THAT THE INFORMATION IN THIS PROSPECTUS, THE PROSPECTUS SUPPLEMENT AND
ANY PRICING
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SUPPLEMENT IS ACCURATE ONLY AS OF THE DATE ON ITS COVER PAGE AND THAT ANY
INFORMATION WE HAVE INCORPORATED BY REFERENCE IS ACCURATE ONLY AS OF THE DATE OF
THE DOCUMENT INCORPORATED BY REFERENCE.
FORWARD-LOOKING INFORMATION
This prospectus, including the information we incorporate by reference,
includes forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
You can identify our forward-looking statements by the words "expects,"
"anticipates," "intends," "plans," "projects," "believes," "estimates" and
similar expressions.
We have based the forward-looking statements relating to
ConocoPhillips' operations on its current expectations, estimates and
projections about ConocoPhillips and the industries in which it operates in
general. We caution you that these statements are not guarantees of future
performance and involve risks, uncertainties and assumptions that we cannot
predict. In addition, we have based many of these forward-looking statements on
assumptions about future events that may prove to be inaccurate. Accordingly,
ConocoPhillips' actual outcomes and results may differ materially from what we
have expressed or forecast in the forward-looking statements. Any differences
could result from a variety of factors, including the following:
o fluctuations in crude oil, natural gas and natural gas liquids
prices, refining and marketing margins and margins for ConocoPhillips'
chemicals business;
o changes in the business, operations, results and prospects of
ConocoPhillips;
o the operation and financing of ConocoPhillips' mid-stream and
chemicals joint ventures;
o potential failure to realize fully or within the expected time frame
the expected cost savings and synergies from the combination of Conoco
and Phillips;
o costs or difficulties related to the integration of the businesses of
Conoco and Phillips, as well as the continued integration of businesses
recently acquired by each of them;
o potential failure or delays in achieving expected reserve or
production levels from existing and future oil and gas development
projects due to operating hazards, drilling risks and the inherent
uncertainties in predicting oil and gas reserves and oil and gas
reservoir performance;
o unsuccessful exploratory drilling activities;
o failure of new products and services to achieve market acceptance;
o unexpected cost increases or technical difficulties in constructing
or modifying facilities for exploration and production projects,
manufacturing or refining;
o unexpected difficulties in manufacturing or refining ConocoPhillips'
refined products, including synthetic crude oil, and chemicals
products;
o lack of, or disruptions in, adequate and reliable transportation for
ConocoPhillips' crude oil, natural gas and refined products;
o inability to timely obtain or maintain permits, comply with
government regulations or make capital expenditures required to
maintain compliance;
o potential disruption or interruption of ConocoPhillips' facilities
due to accidents, political events or terrorism;
o international monetary conditions and exchange controls;
o liability for remedial actions, including removal and reclamation
obligations, under environmental regulations;
o liability resulting from litigation;
o general domestic and international economic and political conditions,
including armed hostilities and governmental disputes over territorial
boundaries;
o changes in tax and other laws or regulations applicable to
ConocoPhillips' business; and
o inability to obtain economical financing for exploration and
development projects, construction or modification of facilities and
general corporate purposes.
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USE OF PROCEEDS
Unless we inform you otherwise in the prospectus supplement, the net
proceeds from the sale of the securities will be used for general corporate
purposes, including repayment or refinancing of debt, acquisitions, working
capital, capital expenditures and repurchases and redemptions of securities.
Pending any specific application, we may initially invest funds in short-term
marketable securities or apply them to the reduction of other short-term
indebtedness. Each trust will use all the proceeds received from the sale of its
trust preferred securities and trust common securities to purchase debt
securities issued by ConocoPhillips.
RATIO OF EARNINGS TO FIXED CHARGES AND
EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS
The following table presents the historical ratios of earnings to fixed
charges of each of Conoco and Phillips and the historical ratio of earnings to
combined fixed charges and preferred stock dividends of Phillips for the
six-month period ended June 30, 2002, and for each of the years in the five-year
period ended December 31, 2001. Conoco had no preferred stock outstanding for
any period presented, and accordingly, its ratio of earnings to combined fixed
charges and preferred stock dividends is the same as its ratio of earnings to
fixed charges. The following table also presents the pro forma ratio of earnings
to fixed charges and ratio of earnings to combined fixed charges and preferred
stock dividends of ConocoPhillips for the six-month period ended June 30, 2002,
and for the year ended December 31, 2001, giving effect to the combination of
Conoco and Phillips using the purchase method of accounting, as if the
combination had occurred on January 1, 2001.
SIX MONTHS ENDED YEAR ENDED DECEMBER 31
JUNE 30 -------------------------------------------------
2002 2001 2000 1999 1998 1997
---------------- ---- ---- ---- ---- ----
RATIO OF EARNINGS TO FIXED CHARGES:
Conoco................................. 2.4x 6.4x 8.5x 3.9x 3.2x 12.9x
Phillips................................ 2.7x 5.4x 6.6x 3.7x 2.1x 5.5x
ConocoPhillips (pro forma).............. 2.8x 5.8x
RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDENDS:
Phillips................................ 2.7x 5.4x 6.6x 3.7x 2.1x 5.5x
ConocoPhillips (pro forma).............. 2.8x 5.8x
For purposes of this table, "earnings" consist of income before income
taxes, extraordinary items and cumulative effect of accounting changes, plus
fixed charges (excluding capitalized interest and the portion of the preferred
dividend requirement of a subsidiary not previously deducted from pretax income,
but including amortization of amounts previously capitalized), less
undistributed earnings of equity investees of Conoco, Phillips or
ConocoPhillips, as applicable. "Fixed charges" consist of interest (including
capitalized interest) on all debt, amortization of debt discounts and expenses
incurred on issuance, and that portion of rental expense believed to represent
interest. In addition, combined fixed charges and preferred stock dividends
include any amounts accrued to cover the preferred stock dividend or
distribution requirements of a subsidiary.
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DESCRIPTION OF THE DEBT SECURITIES
The debt securities of ConocoPhillips covered by this prospectus will be
ConocoPhillips' general unsecured obligations. ConocoPhillips will issue senior
debt securities unconditionally guaranteed by Conoco and Phillips on a senior
unsecured basis under an indenture, dated as of October 9, 2002, among
ConocoPhillips, as issuer, Conoco and Phillips, as guarantors, and The Bank of
New York, as trustee. We refer to this indenture as the senior indenture.
ConocoPhillips will issue subordinated debt securities under an indenture to be
entered into between ConocoPhillips and The Bank of New York, as trustee. We
refer to this indenture as the subordinated indenture. We refer to the senior
indenture and the subordinated indenture collectively as the indentures. The
indentures will be substantially identical, except for provisions relating to
subordination and covenants.
We have summarized material provisions of the indentures, the debt
securities and the guarantees below. This summary is not complete. We have filed
the senior indenture and the form of subordinated indenture with the SEC as
exhibits to the registration statement, and you should read the indentures for
provisions that may be important to you.
In this summary description of the debt securities, unless we state
otherwise or the context clearly indicates otherwise, all references to
ConocoPhillips mean ConocoPhillips only, all references to Conoco mean Conoco
Inc. only and all references to Phillips mean Phillips Petroleum Company only.
PROVISIONS APPLICABLE TO EACH INDENTURE
GENERAL. Neither indenture limits the amount of debt securities that may
be issued under that indenture, and neither limits the amount of other unsecured
debt or securities that ConocoPhillips may issue. ConocoPhillips may issue debt
securities under the indentures from time to time in one or more series, each in
an amount authorized prior to issuance.
Each of ConocoPhillips and Conoco conducts substantially all its
operations through subsidiaries, and those subsidiaries generate substantially
all its operating income and cash flow. As a result, distributions or advances
from those subsidiaries are the principal source of funds necessary to meet the
debt service obligations of ConocoPhillips and Conoco. Contractual provisions or
laws, as well as the subsidiaries' financial condition and operating
requirements, may limit the ability of each of ConocoPhillips and Conoco to
obtain cash from its subsidiaries that it requires to pay its debt service
obligations, including any payments required to be made under the debt
securities and, if applicable, Conoco's related guarantee. In addition, holders
of the debt securities and, if applicable, Conoco's related guarantee will have
a junior position to the claims of creditors of the subsidiaries of
ConocoPhillips or, if applicable, Conoco on their assets and earnings.
Other than the restrictions contained in the senior indenture on liens and
sale/leaseback transactions described below under " -- Provisions Applicable
Solely to Senior Debt Securities -- Restrictive Covenants," neither indenture
contains any covenants or other provisions designed to protect holders of the
debt securities in the event ConocoPhillips participates in a highly leveraged
transaction or upon a change of control. The indentures also do not contain
provisions that give holders the right to require ConocoPhillips to repurchase
their securities in the event of a decline in ConocoPhillips' credit ratings for
any reason, including as a result of a takeover, recapitalization or similar
restructuring or otherwise.
TERMS. The prospectus supplement relating to any series of debt securities
being offered will include specific terms relating to the offering. These terms
will include some or all of the following:
- whether the debt securities will be senior or subordinated debt
securities;
- the title of the debt securities;
- the total principal amount of the debt securities;
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- whether the debt securities will be issued in individual
certificates to each holder or in the form of temporary or permanent
global securities held by a depositary on behalf of holders;
- the date or dates on which the principal of and any premium on the
debt securities will be payable;
- any interest rate, the date from which interest will accrue,
interest payment dates and record dates for interest payments;
- any right to extend or defer the interest payment periods and the
duration of the extension;
- whether and under what circumstances any additional amounts with
respect to the debt securities will be payable;
- the place or places where payments on the debt securities will be
payable;
- any provisions for optional redemption or early repayment;
- any provisions that would require the redemption, purchase or
repayment of debt securities;
- the denominations in which the debt securities will be issued;
- whether payments on the debt securities will be payable in foreign
currency or currency units or another form and whether payments will
be payable by reference to any index or formula;
- the portion of the principal amount of debt securities that will be
payable if the maturity is accelerated, if other than the entire
principal amount;
- any additional means of defeasance of the debt securities, any
additional conditions or limitations to defeasance of the debt
securities or any changes to those conditions or limitations;
- any changes or additions to the events of default or covenants
described in this prospectus;
- any restrictions or other provisions relating to the transfer or
exchange of debt securities;
- any terms for the conversion or exchange of the debt securities for
other securities of ConocoPhillips or any other entity;
- with respect to the subordinated indenture, any changes to the
subordination provisions for the subordinated debt securities; and
- any other terms of the debt securities not inconsistent with the
applicable indenture.
ConocoPhillips may sell the debt securities at a discount, which may be
substantial, below their stated principal amount. These debt securities may bear
no interest or interest at a rate that at the time of issuance is below market
rates. If ConocoPhillips sells these debt securities, we will describe in the
prospectus supplement any material United States federal income tax consequences
and other special considerations.
If ConocoPhillips sells any of the debt securities for any foreign
currency or currency unit or if payments on the debt securities are payable in
any foreign currency or currency unit, we will describe in the prospectus
supplement the restrictions, elections, tax consequences, specific terms and
other information relating to those debt securities and the foreign currency or
currency unit.
SUBSEQUENT DISTRIBUTION TO HOLDERS OF TRUST SECURITIES. If ConocoPhillips
issues debt securities to a ConocoPhillips trust in connection with the issuance
of trust preferred securities and trust common securities by that trust, those
debt securities subsequently may be distributed to the holders of those
securities either:
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- upon the dissolution of the trust; or
- upon the occurrence of events that we will describe in the
prospectus supplement.
CONSOLIDATION, MERGER AND SALE OF ASSETS. The indentures generally permit
a consolidation or merger involving ConocoPhillips or, with respect to the
senior indenture, Conoco or Phillips. They also permit ConocoPhillips, Conoco or
Phillips, as applicable, to lease, transfer or dispose of all or substantially
all of its assets. Each of ConocoPhillips and, with respect to the senior
indenture, Conoco and Phillips has agreed, however, that it will not consolidate
with or merge into any entity (other than, with respect to the senior indenture,
ConocoPhillips, Conoco or Phillips, as applicable) or lease, transfer or dispose
of all or substantially all of its assets to any entity (other than, with
respect to the senior indenture, ConocoPhillips, Conoco or Phillips, as
applicable) unless:
- it is the continuing corporation; or
- if it is not the continuing corporation, the resulting entity or
transferee is organized and existing under the laws of any United
States jurisdiction and assumes the performance of its covenants and
obligations under the indentures and, in the case of ConocoPhillips,
the due and punctual payments on the debt securities or, in the case
of Conoco or Phillips with respect to senior debt securities, the
performance of the related guarantee; and
- in either case, immediately after giving effect to the transaction,
no default or event of default would occur and be continuing or
would result from the transaction.
Upon any such consolidation, merger or asset lease, transfer or
disposition involving ConocoPhillips or, with respect to the senior indenture,
Conoco or Phillips, the resulting entity or transferee will be substituted for
ConocoPhillips, Conoco or Phillips, as applicable, under the applicable
indenture and debt securities. In the case of an asset transfer or disposition
other than a lease, ConocoPhillips, Conoco or Phillips, as applicable, will be
released from the applicable indenture.
EVENTS OF DEFAULT. Unless we inform you otherwise in the applicable
prospectus supplement, the following are events of default with respect to a
series of debt securities:
- failure to pay interest on that series of debt securities for 30
days when due;
- failure to pay principal of or any premium on that series of debt
securities when due;
- failure to redeem or purchase debt securities of that series for 30
days when required;
- failure to comply with any covenant or agreement in that series of
debt securities or the applicable indenture (other than an agreement
or covenant that has been included in the indenture solely for the
benefit of other series of debt securities) for 90 days after
written notice by the trustee or by the holders of at least 25% in
principal amount of the outstanding debt securities issued under
that indenture that are affected by that failure;
- specified events involving bankruptcy, insolvency or reorganization
of ConocoPhillips and, with respect to senior debt securities,
Conoco or Phillips; and
- any other event of default provided for that series of debt
securities.
A default under one series of debt securities will not necessarily be a
default under another series. The trustee may withhold notice to the holders of
the debt securities of any default or event of default (except in any payment on
the debt securities) if the trustee considers it in the interest of the holders
of the debt securities to do so.
If an event of default for any series of debt securities occurs and is
continuing, the trustee or the holders of at least 25% in principal amount of
the outstanding debt securities of the series affected by the default (or, in
some
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cases, 25% in principal amount of all debt securities issued under the
applicable indenture that are affected, voting as one class) may declare the
principal of and all accrued and unpaid interest on those debt securities to be
due and payable. If an event of default relating to certain events of
bankruptcy, insolvency or reorganization occurs, the principal of and interest
on all the debt securities issued under the applicable indenture will become
immediately due and payable without any action on the part of the trustee or any
holder. The holders of a majority in principal amount of the outstanding debt
securities of the series affected by the default (or, in some cases, of all debt
securities issued under the applicable indenture that are affected, voting as
one class) may in some cases rescind this accelerated payment requirement. If
debt securities are issued to a ConocoPhillips trust, the related declaration of
trust may require that any rescission be subject to the consent of the holders
of the trust preferred securities and trust common securities issued by that
trust.
A holder of a debt security of any series issued under an indenture may
pursue any remedy under that indenture only if:
- the holder gives the trustee written notice of a continuing event of
default for that series;
- the holders of at least 25% in principal amount of the outstanding
debt securities of that series make a written request to the trustee
to pursue the remedy;
- the holders offer to the trustee indemnity satisfactory to the
trustee;
- the trustee fails to act for a period of 60 days after receipt of
the request and offer of indemnity; and
- during that 60-day period, the holders of a majority in principal
amount of the debt securities of that series do not give the trustee
a direction inconsistent with the request.
This provision does not, however, affect the right of a holder of a debt
security to sue for enforcement of any overdue payment.
In most cases, holders of a majority in principal amount of the
outstanding debt securities of a series (or of all debt securities issued under
the applicable indenture that are affected, voting as one class) may direct the
time, method and place of:
- conducting any proceeding for any remedy available to the trustee;
and
- exercising any trust or power conferred on the trustee relating to
or arising as a result of an event of default.
The senior indenture requires ConocoPhillips, Conoco and Phillips, and the
subordinated indenture requires ConocoPhillips, to file each year with the
trustee a written statement as to their compliance with the covenants contained
in the applicable indenture.
MODIFICATION AND WAIVER. Each indenture may be amended or supplemented if
the holders of a majority in principal amount of the outstanding debt securities
of all series issued under that indenture that are affected by the amendment or
supplement (acting as one class) consent to it. Without the consent of the
holder of each debt security affected, however, no modification may:
- reduce the amount of debt securities whose holders must consent to
an amendment, supplement or waiver;
- reduce the rate of or change the time for payment of interest on the
debt security;
- reduce the principal of the debt security or change its stated
maturity;
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- reduce any premium payable on the redemption of the debt security or
change the time at which the debt security may or must be redeemed;
- change any obligation to pay additional amounts on the debt
security;
- make payments on the debt security payable in currency other than as
originally stated in the debt security;
- impair the holder's right to institute suit for the enforcement of
any payment on or with respect to the debt security;
- make any change in the percentage of principal amount of debt
securities necessary to waive compliance with certain provisions of
the indenture or to make any change in the provision related to
modification;
- with respect to the subordinated indenture, modify the provisions
relating to the subordination of any subordinated debt security in a
manner adverse to the holder of that security; or
- waive a continuing default or event of default regarding any payment
on the debt securities.
Each indenture may be amended or supplemented or any provision of that
indenture may be waived without the consent of any holders of debt securities
issued under that indenture in certain circumstances, including:
- to cure any ambiguity, omission, defect or inconsistency;
- to provide for the assumption of the obligations under the indenture
of ConocoPhillips or, with respect to the senior indenture, Conoco
or Phillips by a successor upon any merger, consolidation or asset
transfer permitted under the indenture;
- to provide for uncertificated debt securities in addition to or in
place of certificated debt securities or to provide for bearer debt
securities;
- to provide any security for, any guarantees of or any additional
obligors on any series of debt securities or, with respect to the
senior indenture, the related guarantees;
- to comply with any requirement to effect or maintain the
qualification of that indenture under the Trust Indenture Act of
1939;
- to add covenants that would benefit the holders of any debt
securities or to surrender any rights ConocoPhillips or, with
respect to the senior indenture, Conoco or Phillips has under the
indenture;
- to add events of default with respect to any debt securities; and
- to make any change that does not adversely affect any outstanding
debt securities of any series issued under that indenture in any
material respect.
The holders of a majority in principal amount of the outstanding debt
securities of any series (or, in some cases, of all debt securities issued under
the applicable indenture that are affected, voting as one class) may waive any
existing or past default or event of default with respect to those debt
securities. Those holders may not, however, waive any default or event of
default in any payment on any debt security or compliance with a provision that
cannot be amended or supplemented without the consent of each holder affected.
DEFEASANCE. When we use the term defeasance, we mean discharge from some
or all of our obligations under the indentures. If any combination of funds or
government securities are deposited with the trustee under an
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indenture sufficient to make payments on the debt securities of a series issued
under that indenture on the dates those payments are due and payable, then, at
ConocoPhillips' option, either of the following will occur:
- ConocoPhillips and, with respect to the senior indenture, Conoco and
Phillips will be discharged from its or their obligations with
respect to the debt securities of that series and, if applicable,
the related guarantees ("legal defeasance"); or
- ConocoPhillips and, with respect to the senior indenture, Conoco and
Phillips will no longer have any obligation to comply with the
restrictive covenants, the merger covenant and other specified
covenants under the applicable indenture, and the related events of
default will no longer apply ("covenant defeasance").
If a series of debt securities is defeased, the holders of the debt
securities of the series affected will not be entitled to the benefits of the
applicable indenture, except for obligations to register the transfer or
exchange of debt securities, replace stolen, lost or mutilated debt securities
or maintain paying agencies and hold moneys for payment in trust. In the case of
covenant defeasance, the obligation of ConocoPhillips to pay principal, premium
and interest on the debt securities and, if applicable, Conoco's and Phillips'
guarantees of the payments will also survive.
Unless we inform you otherwise in the prospectus supplement, we will be
required to deliver to the trustee an opinion of counsel that the deposit and
related defeasance would not cause the holders of the debt securities to
recognize income, gain or loss for U.S. federal income tax purposes. If we elect
legal defeasance, that opinion of counsel must be based upon a ruling from the
U.S. Internal Revenue Service or a change in law to that effect.
GOVERNING LAW. New York law will govern the indentures and the debt
securities.
TRUSTEE. The Bank of New York is the trustee under the senior indenture
and will be the trustee under the subordinated indenture. The Bank of New York
also serves as trustee or custodian relating to approximately $2.7 billion of
debt, trust preferred securities and other long-term repayment obligations of
subsidiaries of ConocoPhillips as of June 30, 2002. The Bank of New York and its
affiliates perform certain commercial banking services for us for which they
receive customary fees and are lenders under various outstanding credit
facilities of subsidiaries of ConocoPhillips.
If an event of default occurs under an indenture and is continuing, the
trustee under that indenture will be required to use the degree of care and
skill of a prudent person in the conduct of that person's own affairs. The
trustee will become obligated to exercise any of its powers under that indenture
at the request of any of the holders of any debt securities issued under that
indenture only after those holders have offered the trustee indemnity
satisfactory to it.
Each indenture contains limitations on the right of the trustee, if it
becomes a creditor of ConocoPhillips or, if applicable, Conoco or Phillips, to
obtain payment of claims or to realize on certain property received for any such
claim, as security or otherwise. The trustee is permitted to engage in other
transactions with ConocoPhillips and, if applicable, Conoco and Phillips. If,
however, it acquires any conflicting interest, it must eliminate that conflict
or resign within 90 days after ascertaining that it has a conflicting interest
and after the occurrence of a default under the applicable indenture, unless the
default has been cured, waived or otherwise eliminated within the 90-day period.
FORM, EXCHANGE, REGISTRATION AND TRANSFER. The debt securities will be
issued in registered form, without interest coupons. There will be no service
charge for any registration of transfer or exchange of the debt securities.
However, payment of any transfer tax or similar governmental charge payable for
that registration may be required.
Debt securities of any series will be exchangeable for other debt
securities of the same series, the same total principal amount and the same
terms but in different authorized denominations in accordance with the
applicable indenture. Holders may present debt securities for registration of
transfer at the office of the security registrar or any transfer agent
ConocoPhillips designates. The security registrar or transfer agent will effect
the transfer or exchange if its requirements and the requirements of the
applicable indenture are met.
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The trustee will be appointed as security registrar for the debt
securities. If a prospectus supplement refers to any transfer agents
ConocoPhillips initially designates, ConocoPhillips may at any time rescind that
designation or approve a change in the location through which any transfer agent
acts. ConocoPhillips is required to maintain an office or agency for transfers
and exchanges in each place of payment. ConocoPhillips may at any time designate
additional transfer agents for any series of debt securities.
In the case of any redemption, ConocoPhillips will not be required to
register the transfer or exchange of:
- any debt security during a period beginning 15 business days prior
to the mailing of the relevant notice of redemption or repurchase
and ending on the close of business on the day of mailing of such
notice; or
- any debt security that has been called for redemption in whole or in
part, except the unredeemed portion of any debt security being
redeemed in part.
PAYMENT AND PAYING AGENTS. Unless we inform you otherwise in a prospectus
supplement, payments on the debt securities will be made in U.S. dollars at the
office of the trustee and any paying agent. At ConocoPhillips' option, however,
payments may be made by wire transfer for global debt securities or by check
mailed to the address of the person entitled to the payment as it appears in the
security register. Unless we inform you otherwise in a prospectus supplement,
interest payments may be made to the person in whose name the debt security is
registered at the close of business on the record date for the interest payment.
Unless we inform you otherwise in a prospectus supplement, the trustee
under the applicable indenture will be designated as the paying agent for
payments on debt securities issued under that indenture. ConocoPhillips may at
any time designate additional paying agents or rescind the designation of any
paying agent or approve a change in the office through which any paying agent
acts.
If the principal of or any premium or interest on debt securities of a
series is payable on a day that is not a business day, the payment will be made
on the following business day. For these purposes, unless we inform you
otherwise in a prospectus supplement, a "business day" is any day that is not a
Saturday, a Sunday or a day on which banking institutions in any of New York,
New York; Houston, Texas or a place of payment on the debt securities of that
series is authorized or obligated by law, regulation or executive order to
remain closed.
Subject to the requirements of any applicable abandoned property laws, the
trustee and paying agent will pay to us upon written request any money held by
them for payments on the debt securities that remains unclaimed for two years
after the date upon which that payment has become due. After payment to us,
holders entitled to the money must look to us for payment. In that case, all
liability of the trustee or paying agent with respect to that money will cease.
BOOK-ENTRY DEBT SECURITIES. The debt securities of a series may be issued
in the form of one or more global debt securities that would be deposited with a
depositary or its nominee identified in the prospectus supplement. Global debt
securities may be issued in either temporary or permanent form. We will describe
in the prospectus supplement the terms of any depositary arrangement and the
rights and limitations of owners of beneficial interests in any global debt
security.
PROVISIONS APPLICABLE SOLELY TO SENIOR DEBT SECURITIES
RANKING. The senior debt securities will constitute senior debt of
ConocoPhillips and will rank equally with all of its unsecured and
unsubordinated debt from time to time outstanding.
GUARANTEE. Conoco and Phillips will each fully and unconditionally
guarantee on a senior unsecured basis the full and prompt payment of the
principal of and any premium and interest on the senior debt securities issued
by ConocoPhillips when and as the payment becomes due and payable, whether at
maturity or otherwise. The guarantees provide that in the event of a default in
the payment of principal of or any premium or interest on a senior debt
security, the holder of that debt security may institute legal proceedings
directly against Conoco and Phillips to
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enforce the guarantees without first proceeding against ConocoPhillips. The
guarantees will rank equally with all of Conoco's and Phillips' other unsecured
and unsubordinated debt from time to time outstanding.
RESTRICTIVE COVENANTS. ConocoPhillips has agreed to two principal
restrictions on its activities for the benefit of holders of the senior debt
securities. The restrictive covenants summarized below will apply to a series of
senior debt securities (unless waived or amended) as long as any of those debt
securities are outstanding, unless the prospectus supplement for the series
states otherwise. We have used in this summary description capitalized terms
that we have defined below under "-- Glossary."
Limitation on Liens
ConocoPhillips has agreed that it and its Principal Domestic Subsidiaries
will issue, assume or guarantee Debt for borrowed money secured by a lien upon a
Principal Property or shares of stock or Debt of any Principal Domestic
Subsidiary only if the outstanding senior debt securities are secured equally
and ratably with or prior to the Debt secured by that lien. If the senior debt
securities are so secured, ConocoPhillips has the option to secure any of its
and its Subsidiaries' other Debt or obligations equally and ratably with or
prior to the Debt secured by the lien and, accordingly, equally and ratably with
the senior debt securities. This covenant has exceptions that permit:
(a) liens existing on the date ConocoPhillips first issues a series
of senior debt securities under the senior indenture;
(b) liens on the property, assets, stock, equity or Debt of any
entity existing at the time ConocoPhillips or a Subsidiary acquires that
entity or its property or at the time the entity becomes a Subsidiary or a
Principal Domestic Subsidiary;
(c) liens on assets either:
- existing at the time of acquisition of the assets,
- securing all or part of the cost of acquiring,
constructing, improving, developing or expanding the
assets, or
- securing Debt incurred to finance all or part of the
purchase price of the assets or the cost of
constructing, improving, developing or expanding the
assets that was incurred before, at the time of or
within two years after the later of the acquisition, the
completion of construction, improvement, development or
expansion or the commencement of commercial operation of
the assets;
(d) liens on specific assets to secure Debt incurred to provide
funds for the cost of exploration, drilling or development of those
assets;
(e) intercompany liens;
(f) liens securing industrial development, pollution control or
other revenue bonds of a domestic government entity;
(g) liens on personal property, other than shares of stock or debt
of any Principal Domestic Subsidiary, securing loans maturing in less than
one year;
(h) liens on a Principal Property arising in connection with the
sale of accounts receivable resulting from the sale of oil or gas at the
wellhead;
(i) statutory or other liens arising in the ordinary course of
business and relating to amounts that are not yet delinquent or are being
contested in good faith; and
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(j) any extensions, substitutions, replacements or renewals of the
above-described liens or any Debt secured by these liens if both:
- the new lien is limited to the property (plus any
improvements) secured by the original lien, and
- the amount of Debt secured by the new lien and not
otherwise permitted does not materially exceed the
amount of Debt refinanced plus any premium or fee
payable in connection with any such extension,
substitution, replacement or renewal.
In addition, without securing the senior debt securities as described
above, ConocoPhillips and its Principal Domestic Subsidiaries may issue, assume
or guarantee Debt that this covenant would otherwise restrict in a total
principal amount that, when added to all other outstanding Debt of
ConocoPhillips and its Principal Domestic Subsidiaries that this covenant would
otherwise restrict and the total amount of Attributable Debt outstanding for
Sale/Leaseback Transactions, does not exceed a "basket" equal to 10% of
Consolidated Adjusted Net Assets. When calculating this total principal amount,
we exclude from the calculation Attributable Debt from Sale/Leaseback
Transactions in connection with which ConocoPhillips or a Subsidiary has
purchased property or retired or defeased Debt as described in clause (b) below
under "Limitation on Sale/Leaseback Transactions."
The following types of transactions do not create "Debt" secured by
"liens" within the meaning of this covenant:
(a) the sale or other transfer of either:
- oil, gas or other minerals in place for a period of time
until, or in an amount such that, the purchaser will
realize from those minerals a specified amount of money
or a specified amount of those minerals, or
- any other interest in property commonly referred to as a
"production payment"; and
(b) the mortgage or pledge of any property of ConocoPhillips or a
Subsidiary in favor of the United States, any state of the United States
or any department, agency or instrumentality of either, to secure payments
under any contract or statute.
Limitation on Sale/Leaseback Transactions
ConocoPhillips has agreed that it and any of its Principal Domestic
Subsidiaries will enter into a Sale/Leaseback Transaction only if at least one
of the following applies:
(a) ConocoPhillips or that Principal Domestic Subsidiary could incur
Debt in a principal amount equal to the Attributable Debt for that
Sale/Leaseback Transaction and, without violating the "Limitation on
Liens" covenant, could secure that Debt by a lien on the property to be
leased without equally and ratably securing the senior debt securities.
(b) Within the period beginning one year before the closing of the
Sale/Leaseback Transaction and ending one year after the closing,
ConocoPhillips or any Subsidiary applies the net proceeds of the
Sale/Leaseback Transaction either:
- to the voluntary defeasance or retirement of any senior
debt securities issued under the senior indenture or any
Funded Debt, or
- to the acquisition, exploration, drilling, development,
construction, improvement or expansion of one or more
Principal Properties.
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Any net proceeds that are not applied for the purposes described in (b)
will be subject to the limitation described in (a). For purposes of these
calculations, the net proceeds of the Sale/Leaseback Transaction means the
net proceeds of the sale or transfer of the property leased in the
Sale/Leaseback Transaction (or, if greater, the fair value of that
property at the time of the Sale/Leaseback Transaction as determined by
ConocoPhillips' board of directors).
Glossary
"Attributable Debt" means the present value of the rental payments during
the remaining term of the lease included in the Sale/Leaseback Transaction. To
determine that present value, we use a discount rate equal to the lease rate of
the Sale/Leaseback Transaction. For these purposes, rental payments do not
include any amounts required to be paid for taxes, maintenance, repairs,
insurance, assessments, utilities, operating and labor costs and other items
that do not constitute payments for property rights. In the case of any lease
that the lessee may terminate by paying a penalty, if the net amount (including
payment of the penalty) would be reduced if the lessee terminated the lease on
the first date that it could be terminated, then this lower net amount will be
used.
"Consolidated Adjusted Net Assets" means the total amount of assets of
ConocoPhillips and its consolidated subsidiaries less:
- all current liabilities (excluding liabilities that are extendable
or renewable at ConocoPhillips' option to a date more than 12 months
after the date of calculation and excluding current maturities of
long-term debt); and
- total prepaid expenses and deferred charges.
ConocoPhillips will calculate its Consolidated Adjusted Net Assets based on its
most recent quarterly balance sheet.
"Debt" means all notes, bonds, debentures or similar evidences of debt for
money borrowed.
"Funded Debt" means all Debt that matures on or is renewable to a date
more than one year after the date the Debt is incurred.
"Principal Domestic Subsidiary" means each of Conoco, Phillips and any
Subsidiary (1) that has substantially all its assets in the United States, (2)
that owns a Principal Property and (3) in which ConocoPhillips' capital
investment, together with any intercompany loans to that Subsidiary and any debt
of that Subsidiary guaranteed by ConocoPhillips or any other Subsidiary, exceeds
$100 million.
"Principal Property" means any oil or gas producing property located
onshore or offshore of the United States or any refinery or manufacturing plant
located in the United States. This term excludes any property, refinery or plant
that in the opinion of ConocoPhillips' board of directors is not materially
important to the total business conducted by ConocoPhillips and its consolidated
subsidiaries. This term also excludes any transportation or marketing facilities
or assets.
"Sale/Leaseback Transaction" means any arrangement with anyone under which
ConocoPhillips or a Subsidiary leases any Principal Property that ConocoPhillips
or that Subsidiary has sold or transferred or will sell or transfer to that
person. This term excludes the following:
- temporary leases for a term of not more than three years;
- intercompany leases;
- leases of a Principal Property executed by the time of or within 12
months after the latest of the acquisition, the completion of
construction or improvement, or the commencement of commercial
operation of the Principal Property; and
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- arrangements under any provision of law with an effect similar to
the former Section 168(f)(8) of the Internal Revenue Code of 1954.
"Subsidiary" means an entity at least a majority of the outstanding voting
stock of which is owned, directly or indirectly, by ConocoPhillips or by one or
more other Subsidiaries, or by ConocoPhillips and one or more other
Subsidiaries.
PROVISIONS APPLICABLE SOLELY TO SUBORDINATED DEBT SECURITIES
RANKING. The subordinated debt securities will rank junior to all Senior
Debt of ConocoPhillips and may rank equally with or senior to other subordinated
debt of ConocoPhillips that may be outstanding from time to time.
SUBORDINATION. Under the subordinated indenture, payment of the principal
of and any premium and interest on the subordinated debt securities will
generally be subordinated and junior in right of payment to the prior payment in
full of all Senior Debt. Unless we inform you otherwise in the prospectus
supplement, ConocoPhillips may not make any payment of principal of or any
premium or interest on the subordinated debt securities if it fails to pay the
principal, interest, premium or any other amounts on any Senior Debt when due.
The subordination does not affect ConocoPhillips' obligation, which is
absolute and unconditional, to pay, when due, the principal of and any premium
and interest on the subordinated debt securities. In addition, the subordination
does not prevent the occurrence of any default under the subordinated indenture.
The subordinated indenture does not limit the amount of Senior Debt that
ConocoPhillips may incur. As a result of the subordination of the subordinated
debt securities, if ConocoPhillips becomes insolvent, holders of subordinated
debt securities may receive less on a proportionate basis than other creditors.
Unless we inform you otherwise in the prospectus supplement, "Senior Debt"
will mean all debt, including guarantees, of ConocoPhillips, unless the debt
states that it is not senior to the subordinated debt securities or other junior
debt of ConocoPhillips. Senior Debt with respect to a series of subordinated
debt securities could include other series of debt securities issued under the
subordinated indenture.
DESCRIPTION OF CAPITAL STOCK
The following description of ConocoPhillips' common stock, preferred
stock, certificate of incorporation and bylaws is a summary only and is subject
to the complete text of ConocoPhillips' certificate of incorporation and bylaws
and the rights agreement ConocoPhillips has entered into with Mellon Investor
Services LLC, as rights agent, which we have filed as exhibits to the
registration statement. You should read those documents for provisions that may
be important to you.
ConocoPhillips is authorized to issue 2.5 billion shares of common stock,
par value $0.01 per share, and 500 million shares of preferred stock, par value
$0.01 per share.
COMMON STOCK
Each holder of ConocoPhillips common stock is entitled to one vote per
share in the election of directors and on all other matters submitted to the
vote of stockholders. However, except as otherwise required by law, holders of
ConocoPhillips common stock are not entitled to vote on any amendment to
ConocoPhillips' certificate of incorporation that relates solely to the terms of
any series of ConocoPhillips preferred stock if holders of the ConocoPhillips
preferred stock are entitled to vote on the amendment under ConocoPhillips'
certificate of incorporation or Delaware law. There are no cumulative voting
rights, meaning that the holders of a majority of the shares of ConocoPhillips
common stock voting for the election of directors can elect all of the directors
standing for election.
Subject to the rights of the holders of any ConocoPhillips preferred stock
that may be outstanding from time to time, each share of ConocoPhillips common
stock will have an equal and ratable right to receive dividends
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as may be declared by the ConocoPhillips board of directors out of funds legally
available for the payment of dividends, and, in the event of the liquidation,
dissolution or winding up of ConocoPhillips, will be entitled to share equally
and ratably in the assets available for distribution to ConocoPhillips
stockholders. No holder of ConocoPhillips common stock will have any preemptive
or other subscription rights to purchase or subscribe for any securities of
ConocoPhillips.
ConocoPhillips common stock is traded on the New York Stock Exchange under
the trading symbol "COP." The transfer agent for the common stock is Mellon
Investor Services LLC.
PREFERRED STOCK
ConocoPhillips' board of directors has the authority, without stockholder
approval, to issue up to 500 million shares of preferred stock in one or more
series and to fix the number of shares and terms of each series. The board may
determine the designation and other terms of each series, including, among
others:
- dividend rights;
- voting powers;
- preemptive rights;
- conversion rights;
- redemption rights; and
- liquidation preferences.
The prospectus supplement relating to any series of preferred stock
ConocoPhillips is offering will include specific terms relating to the offering
and the name of any transfer agent for that series. We will file the form of the
preferred stock with the SEC before we issue any of it, and you should read it
for provisions that may be important to you. The prospectus supplement will
include some or all of the following terms:
- the title of the preferred stock;
- the maximum number of shares of the series;
- the dividend rate or the method of calculating the dividend, the
date from which dividends will accrue and whether dividends will be
cumulative;
- any liquidation preference;
- any optional redemption provisions;
- any sinking fund or other provisions that would obligate us to
redeem or purchase the preferred stock;
- any terms for the conversion or exchange of the preferred stock for
other securities of us or any other entity;
- whether ConocoPhillips has elected to issue depositary shares with
respect to the preferred stock as described below under "Description
of Depositary Shares";
- any voting rights; and
- any other preferences and relative, participating, optional or other
special rights or any qualifications, limitations or restrictions on
the rights of the shares.
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The issuance of preferred stock, while providing desired flexibility in
connection with possible acquisitions and other corporate purposes, could
adversely affect the voting power of holders of ConocoPhillips' common stock. It
also could affect the likelihood that holders of the common stock will receive
dividend payments and payments upon liquidation.
For purposes of the rights plan described below, ConocoPhillips' board of
directors has designated 10 million shares of preferred stock to constitute the
Series A Junior Participating Preferred Stock. ConocoPhillips Series A preferred
stock will be issuable only in connection with the exercise of rights under the
rights plan. For a description of the rights plan, please read " -- Stockholder
Rights Plan."
Each share of ConocoPhillips Series A preferred stock will be entitled to
a minimum preferential quarterly dividend payment per share of the greater of $1
or 100 times the dividend declared per share of ConocoPhillips common stock. In
the event of the liquidation, dissolution or winding up of ConocoPhillips, the
holders of ConocoPhillips Series A preferred stock will be entitled to a minimum
preferential liquidation payment per share equal to the greater of $100 (plus
all accrued and unpaid dividends) or 100 times the liquidation payment made per
share of ConocoPhillips common stock. Each share of ConocoPhillips Series A
preferred stock will have 100 votes on all matters submitted to a vote of
ConocoPhillips stockholders, voting together with the ConocoPhillips common
stock. In the event of any merger, consolidation or other transaction in which
shares of ConocoPhillips common stock are exchanged for securities, cash and/or
any other property, each share of ConocoPhillips Series A preferred stock will
be entitled to receive 100 times the amount of securities, cash and/or other
properties received per share of ConocoPhillips common stock. These rights will
be protected by customary antidilution provisions.
ANTI-TAKEOVER PROVISIONS OF CONOCOPHILLIPS' CERTIFICATE OF INCORPORATION AND
BYLAWS
ConocoPhillips' certificate of incorporation and bylaws contain provisions
that could delay or make more difficult the acquisition of control of
ConocoPhillips through a hostile tender offer, open market purchases, proxy
contest, merger or other takeover attempt that a stockholder might consider in
his or her best interest, including those attempts that might result in a
premium over the market price of ConocoPhillips' common stock.
AUTHORIZED BUT UNISSUED STOCK
ConocoPhillips has 2.5 billion authorized shares of common stock and 500
million authorized shares of preferred stock. One of the consequences of
ConocoPhillips' authorized but unissued common stock and undesignated preferred
stock may be to enable ConocoPhillips' board of directors to make more difficult
or to discourage an attempt to obtain control of ConocoPhillips. If, in the
exercise of its fiduciary obligations, ConocoPhillips' board of directors
determined that a takeover proposal was not in ConocoPhillips' best interest,
the board could authorize the issuance of those shares without stockholder
approval, subject to limits imposed by the New York Stock Exchange. The shares
could be issued in one or more transactions that might prevent or make the
completion of a proposed change of control transaction more difficult or costly
by:
- diluting the voting or other rights of the proposed acquiror or
insurgent stockholder group;
- creating a substantial voting block in institutional or other hands
that might undertake to support the position of the incumbent board;
or
- effecting an acquisition that might complicate or preclude the
takeover.
In this regard, ConocoPhillips' certificate of incorporation grants its
board of directors broad power to establish the rights and preferences of the
authorized and unissued preferred stock. ConocoPhillips' board could establish
one or more series of preferred stock that entitle holders to:
- vote separately as a class on any proposed merger or consolidation;
- cast a proportionately larger vote together with ConocoPhillips
common stock on any transaction or for all purposes;
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- elect directors having terms of office or voting rights greater than
those of other directors;
- convert preferred stock into a greater number of shares of
ConocoPhillips common stock or other securities;
- demand redemption at a specified price under prescribed
circumstances related to a change of control of ConocoPhillips; or
- exercise other rights designed to impede a takeover.
STOCKHOLDER ACTION BY WRITTEN CONSENT; SPECIAL MEETINGS OF STOCKHOLDERS
ConocoPhillips' certificate of incorporation provides that no action that
is required or permitted to be taken by its stockholders at any annual or
special meeting may be taken by written consent of stockholders in lieu of a
meeting, and that special meetings of stockholders may be called only by the
board of directors or the chairman of the board.
STAGGERED BOARD OF DIRECTORS
ConocoPhillips' certificate of incorporation divides the board of
directors into three classes, as nearly equal in number as possible, serving
staggered three-year terms. The classification of the board of directors has the
effect of requiring at least two annual stockholder meetings, instead of one, to
effect a change in a majority of the board of directors.
REMOVAL OF DIRECTORS
Directors may only be removed for cause by a vote of a majority of the
voting power of ConocoPhillips' outstanding voting stock. A vacancy on
ConocoPhillips' board of directors may be filled by a vote of a majority of the
directors in office or by the stockholders if that vacancy resulted from the
action of stockholders (in which case that vacancy may not be filled by the
directors).
ADVANCE NOTICE PROCEDURE FOR DIRECTOR NOMINATIONS AND STOCKHOLDER
PROPOSALS
ConocoPhillips' bylaws provide the manner in which stockholders may give
notice of stockholder nominations and other business to be brought before an
annual meeting. In general, to bring a matter before an annual meeting or to
nominate a candidate for director, a stockholder must give notice of the
proposed matter or nomination not less than 90 and not more than 120 days prior
to the first anniversary date of the immediately preceding meeting. If the
annual meeting is not within 30 days before or after the anniversary date of the
preceding annual meeting, the stockholder notice must be received no later than
the later of (1) 90 days prior to the anniversary date or (2) the close of
business on the 10th day following the day on which notice of the annual meeting
was mailed or first publicly disclosed, whichever first occurs.
These procedures may limit the ability of stockholders to nominate
candidates for director and bring other business before a stockholders meeting,
including the consideration of any transaction that could result in a change of
control and that might result in a premium to ConocoPhillips' stockholders.
FAIR PRICE PROVISION
ConocoPhillips' certificate of incorporation requires that specified
business combinations involving a person or entity that beneficially owns 15% or
more of the outstanding shares of ConocoPhillips voting stock or that is an
affiliate of that person, which we refer to as a related person, must be
approved by (1) at least 80% of the votes entitled to be cast by the voting
stock and (2) at least 66-2/3% of the votes entitled to be cast by the voting
stock other than voting stock owned by the related person. These supermajority
requirements do not apply if:
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- a majority of the directors who are unaffiliated with the related
person and who were in office before the related person became a
related person approve the transaction; or
- specified fair price conditions are met that in general provide that
the payment received by the stockholders in the business combination
is not less than the amount the related person paid or agreed to pay
for any shares of ConocoPhillips' voting stock acquired within one
year of the business combination.
AMENDMENT OF CERTIFICATE OF INCORPORATION AND BYLAWS
Amendments to ConocoPhillips' certificate of incorporation generally must
be approved by the board of directors and by a majority of the outstanding stock
entitled to vote on the amendment, and, if applicable, by majority of the
outstanding stock of each class or series entitled to vote on the amendment as a
class or series.
Under the ConocoPhillips' certificate of incorporation, the affirmative
vote of shares representing not less than 80% of the votes entitled to be cast
by the voting stock is required to alter, amend or adopt any provision
inconsistent with or repeal the provisions that, among others, (1) control the
constitution of the board of directors, (2) deny stockholders the right to call
a special meeting or to act by written consent, (3) limit or eliminate the
liability of directors to ConocoPhillips and (4) set the 80% supermajority
threshold applicable with respect to the provisions above.
Additionally, the affirmative vote of shares representing (1) not less
than 80% of the votes entitled to be cast by the voting stock, voting together
as a single class, and (2) not less than 66-2/3% of the votes entitled to be
case by the voting stock not owned, directly or indirectly, by any related
person is required to amend, repeal, or adopt any provisions inconsistent with,
the fair price provision described above.
ConocoPhillips' bylaws have similar supermajority vote requirements for
provisions relating to, among others, special stockholder meetings; prohibition
on action by stockholder written consent; nominating directors and bringing
business before an annual stockholder meeting; the number, classification and
qualification of directors; filling vacancies on the board of directors; and
removing directors.
STOCKHOLDER RIGHTS PLAN
ConocoPhillips has entered into a rights agreement with Mellon Investor
Services LLC, as rights agent. As with most rights agreements, the terms of the
ConocoPhillips rights agreement are complex and not easily summarized,
particularly as they relate to the acquisition of ConocoPhillips common stock
and to the exercisability of the rights. Accordingly, this summary may not
contain all of the information that is important to you, and is qualified in its
entirety by reference to the ConocoPhillips rights agreement, which we have
filed as an exhibit to the registration statement.
Under the terms of the rights agreement, each share of common stock has
attached to it a right to purchase one one-hundredth of a share of
ConocoPhillips Series A preferred stock. The purchase price per one-hundredth of
a share of Series A preferred stock under the rights agreement is $300.
Initially, the rights under the ConocoPhillips rights agreement will be
attached to certificates representing ConocoPhillips common stock and no
separate certificates representing the rights will be distributed. The rights
will separate from the ConocoPhillips common stock and be represented by
separate certificates at the earlier of (1) the first date of a public
announcement that a person has acquired 15% or more of the outstanding
ConocoPhillips common stock or (2) the date as may be determined by the
ConocoPhillips board of directors after the commencement by a person of a tender
offer or exchange offer for 15% or more of the outstanding ConocoPhillips common
stock.
After the rights separate from the ConocoPhillips common stock,
certificates representing the rights will be mailed to record holders of
ConocoPhillips common stock. Once distributed, the rights certificates alone
will represent the rights.
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The rights will not be exercisable until the date the rights separate from
the ConocoPhillips common stock. The rights will expire on the tenth anniversary
of the date of the ConocoPhillips rights agreement unless earlier redeemed or
exchanged by ConocoPhillips.
If an acquiror obtains beneficial ownership of 15% or more of
ConocoPhillips common stock, then each right will be adjusted so that it will
entitle the holder (other than the acquiror, whose rights will become void) to
purchase a number of shares of ConocoPhillips common stock equal to two times
the exercise price of the right.
If an acquiror obtains beneficial ownership of 15% or more of
ConocoPhillips common stock and any of the following occurs:
- ConocoPhillips merges into or consolidates with another entity,
- an acquiring entity merges into ConocoPhillips with ConocoPhillips
as the surviving entity and the outstanding shares of ConocoPhillips
common stock are converted into cash, property or securities, or
- ConocoPhillips sells more than 50% of its assets or earning power,
then each right will entitle the holder to purchase a number of shares of common
stock of the acquiror having a then-current market value (as defined in the
ConocoPhillips rights agreement) of twice the exercise price of the right.
In the event of a public announcement of an acquiror obtaining beneficial
ownership of 15% or more of the outstanding shares of ConocoPhillips common
stock (but only if the beneficial ownership of the acquiror is less than 50%),
the ConocoPhillips board of directors may, at its option, exchange all or a part
of the outstanding rights for ConocoPhillips common stock at an exchange ratio
of one share of ConocoPhillips common stock per right, adjusted to reflect stock
splits, stock dividends or similar transactions.
The ConocoPhillips board of directors may, at its option, redeem the
rights, in whole but not in part, at any time prior to the time an acquiror
obtains beneficial ownership of 15% or more of the outstanding shares of
ConocoPhillips common stock. The redemption price is $.01 per right, adjusted to
reflect stock splits, stock dividends or similar transactions. ConocoPhillips
may, at its option, pay the redemption price in cash, common stock or other
consideration as deemed appropriate by the ConocoPhillips board of directors.
The terms of the rights may be amended by the ConocoPhillips board of
directors without the consent of the holders of the rights, except that, after
an acquiror obtains 15% or more of ConocoPhillips common stock, the
ConocoPhillips rights agreement may not be amended in any manner that would
adversely affect the interests of the rights holders.
The ConocoPhillips rights agreement contains provisions that have
anti-takeover effects. The rights will cause substantial dilution to a person or
group that attempts to acquire ConocoPhillips on terms not approved by the
ConocoPhillips board of directors. However, since the rights may either be
redeemed or otherwise made inapplicable by ConocoPhillips prior to an acquiror
obtaining beneficial ownership of 15% or more of ConocoPhillips common stock,
the rights should not interfere with any merger or business combination approved
by the ConocoPhillips board of directors prior to that occurrence. In addition,
the rights should not interfere with a proxy contest.
LIMITATION OF LIABILITY OF DIRECTORS
To the fullest extent permitted by Delaware law, ConocoPhillips' directors
will not be personally liable to ConocoPhillips or its stockholders for monetary
damages for breach of fiduciary duty as a director. Delaware law currently
permits the elimination of all liability for breach of fiduciary duty, except
liability:
- for any breach of the duty of loyalty to ConocoPhillips or its
stockholders;
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- for acts or omissions not in good faith or involving intentional
misconduct or a knowing violation of law;
- for unlawful payment of a dividend or unlawful stock purchases or
redemptions; and
- for any transaction from which the director derived an improper
personal benefit.
As a result, neither ConocoPhillips nor its stockholders have the right,
through stockholders' derivative suits on ConocoPhillips' behalf, to recover
monetary damages against a director for breach of fiduciary duty as a director,
including breaches resulting from grossly negligent behavior, except in the
situations described above.
DELAWARE ANTI-TAKEOVER LAW
ConocoPhillips is a Delaware corporation and is subject to Section 203 of
the Delaware General Corporation Law, which regulates corporate acquisitions.
Section 203 prevents an "interested stockholder," which is defined generally as
a person owning 15% or more of a corporation's voting stock, or any affiliate or
associate of that person, from engaging in a broad range of "business
combinations" with the corporation for three years after becoming an interested
stockholder unless:
- the board of directors of the corporation had previously approved
either the business combination or the transaction that resulted in
the stockholder's becoming an interested stockholder;
- upon completion of the transaction that resulted in the
stockholder's becoming an interested stockholder, that person owned
at least 85% of the voting stock of the corporation outstanding at
the time the transaction commenced, excluding shares owned by
persons who are directors and also officers and shares owned in
employee stock plans in which participants do not have the right to
determine confidentially whether shares held subject to the plan
will be tendered in a tender or exchange offer; or
- following the transaction in which that person became an interested
stockholder, the business combination is approved by the board of
directors of the corporation and holders of at least two-thirds of
the outstanding voting stock not owned by the interested
stockholder.
Under Section 203, the restrictions described above also do not apply to
specific business combinations proposed by an interested stockholder following
the announcement or notification of designated extraordinary transactions
involving the corporation and a person who had not been an interested
stockholder during the previous three years or who became an interested
stockholder with the approval of a majority of the corporation's directors, if
such extraordinary transaction is approved or not opposed by a majority of the
directors who were directors prior to any person becoming an interested
stockholder during the previous three years or were recommended for election or
elected to succeed such directors by a majority of such directors.
Section 203 may make it more difficult for a person who would be an
interested stockholder to effect various business combinations with a
corporation for a three-year period.
DESCRIPTION OF WARRANTS
ConocoPhillips may issue warrants to purchase any combination of debt
securities, common stock, preferred stock, rights or other securities of
ConocoPhillips or any other entity. ConocoPhillips may issue warrants
independently or together with other securities. Warrants sold with other
securities may be attached to or separate from the other securities.
ConocoPhillips will issue warrants under one or more warrant agreements between
it and a warrant agent that we will name in the prospectus supplement.
The prospectus supplement relating to any warrants ConocoPhillips is
offering will include specific terms relating to the offering. We will file the
form of any warrant agreement with the SEC, and you should read the
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warrant agreement for provisions that may be important to you. The prospectus
supplement will include some or all of the following terms:
- the title of the warrants;
- the aggregate number of warrants offered;
- the designation, number and terms of the debt securities, common
stock, preferred stock, rights or other securities purchasable upon
exercise of the warrants, and procedures by which the number of
securities purchasable may be adjusted;
- the exercise price of the warrants;
- the dates or periods during which the warrants are exercisable;
- the designation and terms of any securities with which the warrants
are issued;
- if the warrants are issued as a unit with another security, the
date, if any, on and after which the warrants and the other security
will be separately transferable;
- if the exercise price is not payable in U.S. dollars, the foreign
currency, currency unit or composite currency in which the exercise
price is denominated;
- any minimum or maximum amount of warrants that may be exercised at
any one time; and
- any terms, procedures and limitations relating to the
transferability, exchange or exercise of the warrants.
DESCRIPTION OF DEPOSITARY SHARES
GENERAL
ConocoPhillips may elect to offer shares of its preferred stock
represented by depositary shares. The shares of any series of the preferred
stock underlying the depositary shares will be deposited under a separate
deposit agreement between ConocoPhillips and a bank or trust company we will
name in the prospectus supplement.
Subject to the terms of the deposit agreement, each holder of a depositary
share will be entitled, proportionately, to all the rights, preferences and
privileges of the preferred stock represented by that depositary share,
including dividend, voting, redemption, conversion, exchange and liquidation
rights. The depositary shares will be evidenced by depositary receipts issued
under the deposit agreement. Each receipt will represent the applicable interest
in a number of shares of a particular series of the preferred stock, which we
will describe in the prospectus supplement.
We have summarized below selected provisions of the deposit agreement, the
related depositary shares and depositary receipts evidencing those shares. This
summary is not complete. We will file the form of deposit agreement and the form
of depositary receipts with the SEC before ConocoPhillips issues any depositary
shares, and you should read those documents for provisions that may be important
to you.
A holder of depositary shares will be entitled to receive the whole number
of shares of preferred stock underlying those depositary shares. Holders will
not be entitled to receive fractional shares. If the depositary receipts
delivered by the holder evidence a number of depositary shares in excess of the
whole number of shares to be withdrawn, the depositary will deliver to that
holder at the same time a new depositary receipt for the excess number of
depositary shares.
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DIVIDENDS AND OTHER DISTRIBUTIONS
The depositary will distribute all cash dividends or other cash
distributions received with respect to the preferred stock to the record holders
of depositary receipts in proportion to the number of depositary shares owned by
those holders.
If there is a distribution other than in cash, the depositary will
distribute property received by it to the record holders of depositary receipts
in proportion, insofar as possible, to the number of depositary shares owned by
those holders. If the depositary determines that it is not feasible to make such
a distribution, it may, with ConocoPhillips' approval, adopt any method that it
deems equitable and practicable to effect the distribution, including a sale of
the property and distribution of the net proceeds from the sale to the holders.
The amount distributed in any of the above cases will be reduced by any
amount ConocoPhillips or the depositary is required to withhold on account of
taxes.
CONVERSION AND EXCHANGE
If any preferred stock underlying the depositary shares is subject to
provisions relating to its conversion or exchange as described in the prospectus
supplement, each record holder of depositary shares will have the right or
obligation to convert or exchange those depositary shares in accordance with
those provisions.
REDEMPTION OF DEPOSITARY SHARES
Whenever ConocoPhillips redeems a share of preferred stock held by the
depositary, the depositary will redeem on the same redemption date a
proportionate number of depositary shares representing the shares of preferred
stock redeemed. The redemption price per depositary share will be equal to the
aggregate redemption price payable with respect to the number of shares of
preferred stock underlying the depositary shares. If fewer than all the
depositary shares are to be redeemed, the depositary shares to be redeemed will
be selected by lot or proportionately as ConocoPhillips may determine.
VOTING
Upon receipt of notice of any meeting at which the holders of the
preferred stock underlying the depositary shares are entitled to vote, the
depositary will mail the information contained in the notice to the record
holders of the depositary receipts. Each record holder of the depositary
receipts on the record date, which will be the same date as the record date for
the preferred stock, may then instruct the depositary as to the exercise of the
voting rights pertaining to the number of shares of preferred stock underlying
that holder's depositary shares. The depositary will try, as far as practicable,
to vote the number of shares of preferred stock underlying the depositary shares
in accordance with the instructions, and ConocoPhillips will agree to take all
reasonable action that the depositary deems necessary to enable the depositary
to do so. The depositary will abstain from voting the preferred stock to the
extent that it does not receive specific written instructions from holders of
depositary shares representing the preferred stock.
RECORD DATE
Whenever:
- any cash dividend or other cash distribution becomes payable, any
distribution other than cash is made, or any rights, preferences or
privileges are offered with respect to the preferred stock, or
- the depositary receives notice of any meeting at which holders of
preferred stock are entitled to vote or of which holders of
preferred stock are entitled to notice, or of the mandatory
conversion of or any election by ConocoPhillips to call for the
redemption of any preferred stock,
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the depositary will in each instance fix a record date, which will be the same
as the record date for the preferred stock, for the determination of the holders
of depositary receipts:
- who will be entitled to receive the dividend, distribution, rights,
preferences or privileges or the net proceeds of any sale, or
- who will be entitled to give instructions for the exercise of voting
rights at any such meeting or to receive notice of the meeting or
the redemption or conversion.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
ConocoPhillips and the depositary may at any time agree to amend the form
of depositary receipt and any provision of the deposit agreement. However, any
amendment that adversely alters the rights of holders of depositary shares in
any material respect will not be effective unless the amendment has been
approved by the holders of at least a majority of the depositary shares then
outstanding. The deposit agreement may be terminated by ConocoPhillips or by the
depositary only if all outstanding depositary shares have been redeemed or if a
final distribution on the underlying preferred stock has been made to the
holders of the depositary shares in connection with the liquidation, dissolution
or winding up of ConocoPhillips.
CHARGES OF DEPOSITARY
ConocoPhillips will pay all charges of the depositary, including:
- charges in connection with the initial deposit of the preferred
stock;
- the initial issuance of the depositary receipts;
- the distribution of information to the holders of depositary
receipts with respect to matters on which preferred stock is
entitled to vote; and
- withdrawals of the preferred stock by the holders of depositary
receipts or upon redemption or conversion of the preferred stock.
Holders of depositary shares will pay taxes (including any transfer taxes) and
other governmental charges and any other charges expressly provided in the
deposit agreement to be at the expense of those holders.
RESIGNATION AND REMOVAL OF DEPOSITARY
The depositary may at any time resign or be removed by ConocoPhillips. Any
resignation or removal will become effective upon the acceptance by the
depositary's successor of its appointment. If ConocoPhillips has not appointed a
successor depositary and the successor depositary has not accepted its
appointment within 60 days after the depositary delivered a resignation notice
to ConocoPhillips, the depositary may terminate the deposit agreement.
DESCRIPTION OF STOCK PURCHASE CONTRACTS
AND STOCK PURCHASE UNITS
ConocoPhillips may issue stock purchase contracts, including contracts
obligating holders to purchase from ConocoPhillips, and ConocoPhillips to sell
to the holders, or for ConocoPhillips to issue in exchange for other securities,
a specified number of shares of ConocoPhillips common stock or preferred stock
(or a range of numbers of shares in accordance with a predetermined formula) at
a future date or dates or upon the occurrence of specified events. The price per
share of common stock or preferred stock may be fixed at the time the stock
purchase contracts are issued or may be determined by reference to a specific
formula set forth in the stock purchase contracts.
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ConocoPhillips may issue the stock purchase contracts separately or as a
part of units, often known as stock purchase units, consisting of a stock
purchase contract and any combination of:
- senior debt securities or subordinated debt securities of
ConocoPhillips,
- debt obligations of third parties, including U.S. Treasury
securities, or
- trust preferred securities of a ConocoPhillips trust,
securing the holder's obligations to purchase the common stock or preferred
stock under the stock purchase contracts.
The stock purchase contracts may require ConocoPhillips to make periodic
payments to the holders of the stock purchase units or vice versa, and those
payments may be unsecured or prefunded on some basis. The stock purchase
contracts may require holders to secure their obligations in a specified manner,
and in specified circumstances ConocoPhillips may deliver newly issued prepaid
stock purchase contracts, often known as prepaid securities, upon release to a
holder of any collateral securing that holder's obligations under the original
stock purchase contract.
The applicable prospectus supplement will describe the terms of any stock
purchase contracts or stock purchase units and, if applicable, prepaid
securities. That description will not be complete. For more information, you
should review the stock purchase contracts and, if applicable, the collateral
arrangements and depositary arrangements relating to those stock purchase
contracts or stock purchase units and any prepaid securities and the document
under which the prepaid securities will be issued. We will file forms of these
documents with the SEC before ConocoPhillips issues any stock purchase contracts
or stock purchase units and, if applicable, prepaid securities.
DESCRIPTION OF THE TRUST PREFERRED SECURITIES
TRUST PREFERRED SECURITIES
GENERAL
Each ConocoPhillips trust may issue only one series of trust preferred
securities. The amended and restated declaration of trust of each trust will
authorize that trust to issue one series of trust preferred securities of that
trust. We have summarized selected provisions of the trust preferred securities
below. This summary is not complete. We have filed the form of amended and
restated declaration of trust providing for the trust preferred securities with
the SEC as an exhibit to the registration statement, and you should read that
document for provisions that may be important to you. Please read "About the
ConocoPhillips Trusts" for additional information about the trusts.
The prospectus supplement relating to trust preferred securities being
offered will include specific terms relating to the offering. These terms will
include some or all of the following:
- the designation of the trust preferred securities;
- the number of trust preferred securities issued by the trust;
- the annual distribution rate (or the method for determining the
rate), the distribution payment dates, the record dates for
distribution payments and the additional amounts, if any, that may
be payable with respect to the trust preferred securities;
- whether distributions will be cumulative and, if so, the dates from
which distributions will be cumulative;
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- the amounts that will be paid out of the assets of the trust to the
holders of trust preferred securities upon dissolution, winding-up
or termination of the trust;
- any repurchase or redemption provisions;
- any additional voting rights of the trust preferred securities;
- terms for any conversion or exchange of the trust preferred
securities or the debt securities of ConocoPhillips held by that
trust into other securities;
- terms for any distribution of the debt securities to the holders of
the trust preferred securities; and
- any rights to defer distributions on the trust preferred securities
by extending the interest payment period on the debt securities.
We also will describe in the prospectus supplement the material United
States federal income tax considerations applicable to any offering of trust
preferred securities.
ConocoPhillips will guarantee the trust preferred securities to the extent
described under "Description of the Preferred Securities Guarantees."
VOTING
Holders of trust preferred securities will have limited voting rights,
relating only to the modification of the trust preferred securities and the
exercise of a trust's rights as holder of the debt securities and the preferred
securities guarantee. Holders of trust preferred securities will not be able to
appoint, remove or replace trustees, except in limited circumstances, or to
increase or decrease the number of trustees, because these rights will be vested
in the holder of the common securities of the trust. ConocoPhillips will own,
directly or indirectly, all of the common securities of each trust.
DISTRIBUTIONS
Under each declaration of trust, the property trustee must make
distributions on the trust preferred securities of a trust to the extent that
the property trustee has cash on hand in the applicable property account to
permit such payment. The only funds available for distribution to the holders of
the trust preferred securities of a trust will be those received by the property
trustee on the debt securities held by the trust. If ConocoPhillips does not
make payments on the debt securities, the property trustee will not make
corresponding distributions on the trust preferred securities. Under each
declaration of trust, if and to the extent ConocoPhillips does make payments on
the debt securities, the property trustee will be obligated to make
distributions on the preferred and common securities of such trust on a pro rata
basis.
ConocoPhillips will guarantee payment of distributions on the trust
preferred securities of a trust as and to the extent described under " -- Trust
Preferred Securities Guarantees." A guarantee covers distributions and other
payments on the applicable trust preferred securities only if and to the extent
that ConocoPhillips has made a payment to the property trustee on the applicable
debt securities. If an event of default under the related declaration of trust
has occurred and is continuing, any funds available to make payments will be
paid first to the holders of the trust preferred securities pro rata based on
the aggregate liquidation amount of trust preferred securities held by those
holders in relation to the aggregate liquidation amount of all the outstanding
trust preferred securities. In that case, the holder of common securities of a
trust would receive payments only after satisfaction of all amounts owed to the
holders of trust preferred securities.
EVENTS OF DEFAULT
If an event of default under the declaration of trust has occurred and is
continuing, the holders of a majority in liquidation amount of the trust
preferred securities may direct the property trustee to enforce the available
rights
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under the related declaration of trust, including rights available to the
property trustee as a holder of the applicable series of debt securities. If the
property trustee fails to enforce those rights, any holder of the related trust
preferred securities may provide written notice to the property trustee that the
holder will enforce those rights and, 30 days after submitting that request, the
holder may enforce those rights directly against ConocoPhillips to the fullest
extent permitted by law without first instituting any legal proceeding against
the property trustee or any other person.
If an event of default under the applicable declaration of trust has
occurred and is continuing and results from ConocoPhillips' failure to make
payments on the applicable series of debt securities when due, then any holder
of the trust preferred securities may directly institute a proceeding to enforce
those payments on the debt securities in an amount corresponding to the
aggregate liquidation amount of that holder's trust preferred securities. If a
holder brings a direct action, ConocoPhillips will be entitled to that holder's
rights under the applicable declaration of trust to the extent of any payment
made by ConocoPhillips to that holder. EXCEPT AS EXPRESSLY PROVIDED IN THE
PRECEDING SENTENCES OR IN THE APPLICABLE PROSPECTUS SUPPLEMENT, THE HOLDERS OF
THE TRUST PREFERRED SECURITIES WILL NOT BE ABLE TO EXERCISE DIRECTLY ANY OTHER
REMEDY AVAILABLE TO THE HOLDERS OF THE APPLICABLE SERIES OF DEBT SECURITIES.
TRUST PREFERRED SECURITIES GUARANTEES
ConocoPhillips will fully and unconditionally guarantee payments on the
trust preferred securities as described in this section. This guarantee covers
the following payments:
- periodic cash distributions on the trust preferred securities out of
funds held by the property trustee of the trust;
- payments on liquidation of each trust; and
- payments on redemption of trust preferred securities of each trust.
ConocoPhillips will appoint The Bank of New York, as guarantee trustee, to
hold the guarantee for the benefit of the holders of trust preferred securities.
We have summarized selected provisions of the guarantees below. This summary is
not complete. We have filed the form of guarantee with the SEC as an exhibit to
the registration statement, and you should read that document for provisions
that may be important to you.
ConocoPhillips will irrevocably and unconditionally agree to pay holders
of trust preferred securities in full the following amounts to the extent not
paid by the trust:
- any accumulated and unpaid distributions on the trust preferred
securities and any redemption price for trust preferred securities
called for redemption by the trust, if and to the extent that
ConocoPhillips has made corresponding payments on the debt
securities to the property trustee of the trust;
- payments upon the dissolution, winding-up or termination of the
trust equal to the lesser of:
- the liquidation amount plus all accumulated and unpaid
distributions on the trust preferred securities to the extent
the trust has funds legally available for those payments, and
- the amount of assets of the trust remaining legally available
for distribution to the holders of trust preferred securities
in liquidation of the trust.
ConocoPhillips will not be required to make these liquidation payments if:
- the trust distributes the debt securities to the holders of
trust preferred securities in exchange for their trust
preferred securities; or
- the trust redeems the trust preferred securities in full upon
the maturity or redemption of the debt securities.
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ConocoPhillips may satisfy its obligation to make a guarantee payment
either by making payment directly to the holders of trust preferred securities
or to the guarantee trustee for remittance to the holders or by causing the
applicable trust to make the payment to them.
Each guarantee is a guarantee from the time of issuance of the applicable
series of trust preferred securities. THE GUARANTEE ONLY COVERS, HOWEVER,
DISTRIBUTIONS AND OTHER PAYMENTS ON TRUST PREFERRED SECURITIES IF AND TO THE
EXTENT THAT CONOCOPHILLIPS HAS MADE CORRESPONDING PAYMENTS ON THE DEBT
SECURITIES TO THE APPLICABLE PROPERTY TRUSTEE. IF CONOCOPHILLIPS DOES NOT MAKE
THOSE CORRESPONDING PAYMENTS ON THE DEBT SECURITIES, THE TRUST WILL NOT HAVE
FUNDS AVAILABLE FOR PAYMENTS AND THAT TRUSTEE WILL NOT MAKE DISTRIBUTIONS ON THE
TRUST PREFERRED SECURITIES.
ConocoPhillips' obligations under the declaration of trust for each trust,
the guarantees, the debt securities and the associated indenture taken together
will provide a full and unconditional guarantee of payments due on the trust
preferred securities.
COVENANTS OF CONOCOPHILLIPS
In each guarantee, ConocoPhillips will agree that, as long as any trust
preferred securities issued by the applicable trust are outstanding,
ConocoPhillips will not make the payments and distributions described below if:
- it is in default on its guarantee payments or other payment obligations
under the related guarantee;
- any event of default under the applicable declaration of trust has
occurred and is continuing; or
- ConocoPhillips has elected to defer payments of interest on the related
debt securities by extending the interest payment period and that
deferral period is continuing.
In these circumstances, ConocoPhillips will agree that it will not:
- make any payments on or repay, repurchase or redeem any debt security
of ConocoPhillips that ranks equally with or junior to the debt
securities;
- make any guarantee payments on any guarantee by ConocoPhillips of the
debt securities of any of its subsidiaries if that guarantee ranks
equally with or junior to the debt securities; or
- declare or pay any dividends on, or redeem, purchase, acquire or make a
distribution or liquidation payment with respect to, any capital stock
of ConocoPhillips, other than:
- dividends or distributions in its capital stock or options, warrants
or rights to subscribe for or purchase its capital stock;
- transactions relating to ConocoPhillips' stockholder rights plan;
- as a result of a reclassification of its capital stock or the
exchange or conversion of one class or series of its capital stock
for another class or series of its share capital;
- purchases of fractional interests in shares of its capital stock
pursuant to the conversion or exchange provisions of the capital
stock or the security being converted or exchanged; and
- purchases or acquisitions of its capital stock in connection with
the satisfaction by it of its obligations under any employee
stock-based compensation or benefit plan, dividend reinvestment plan
or stock purchase plan.
In addition, as long as trust preferred securities issued by any trust are
outstanding, ConocoPhillips will agree that it will:
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- remain the sole direct or indirect owner of all the outstanding common
securities of that trust, except as permitted by the applicable
declaration of trust;
- permit the common securities of that trust to be transferred only as
permitted by the declaration of trust; and
- use reasonable efforts to cause that trust to continue to be treated as
a grantor trust for United States federal income tax purposes, except
in connection with a distribution of debt securities to the holders of
trust preferred securities as provided in the declaration of trust, in
which case the trust would be dissolved.
AMENDMENTS AND ASSIGNMENT
ConocoPhillips and the guarantee trustee may amend each guarantee without
the consent of any holder of trust preferred securities if the amendment does
not adversely affect the rights of the holders in any material respect. In all
other cases, ConocoPhillips and the guarantee trustee may amend each guarantee
only with the prior approval of the holders of a majority in liquidation amount
of the trust preferred securities issued by the applicable trust. The manner in
which ConocoPhillips will obtain that approval will be described in the
prospectus supplement.
ConocoPhillips may assign its obligations under the guarantees only in
connection with a consolidation, merger or asset sale involving ConocoPhillips
permitted under the indenture governing the debt securities.
TERMINATION OF THE GUARANTEE
Each guarantee will terminate upon:
- full payment of the redemption price of all trust preferred securities
of the applicable trust;
- distribution of the debt securities, or any securities into which those
debt securities are convertible, to the holders of the trust preferred
securities and common securities of that trust in exchange for all the
securities issued by that trust; or
- full payment of the amounts payable upon liquidation of that trust.
Each guarantee will, however, continue to be effective or will be
reinstated if any holder of trust preferred securities must repay any amounts
paid on those trust preferred securities or under the guarantee.
STATUS OF THE GUARANTEE
ConocoPhillips' obligations under each guarantee will be unsecured and
effectively junior to all debt and preferred stock of its subsidiaries. We will
specify in the prospectus supplement the ranking of each guarantee with respect
to ConocoPhillips' capital stock and other liabilities, including other
guarantees. BY YOUR ACCEPTANCE OF THE TRUST PREFERRED SECURITIES, YOU AGREE TO
ANY SUBORDINATION PROVISIONS AND OTHER TERMS OF THE RELATED GUARANTEE.
Each guarantee will be deposited with the guarantee trustee to be held for
the benefit of the holders of the trust preferred securities. The guarantee
trustee will have the right to enforce the guarantee on behalf of those holders.
In most cases, the holders of a majority in liquidation amount of the trust
preferred securities issued by the applicable trust will have the right to
direct the time, method and place of:
- conducting any proceeding for any remedy available to the applicable
guarantee trustee; or
- exercising any trust or other power conferred upon that guarantee
trustee under the applicable guarantee.
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Each guarantee will constitute a guarantee of payment and not merely of
collection. This means that the guarantee trustee may institute a legal
proceeding directly against ConocoPhillips to enforce the payment rights under
the guarantee without first instituting a legal proceeding against any other
person or entity.
If the guarantee trustee fails to enforce the guarantee or ConocoPhillips
fails to make a guarantee payment, a holder of trust preferred securities may
institute a legal proceeding directly against ConocoPhillips to enforce that
holder's rights under that guarantee without first instituting a legal
proceeding against the applicable trust, the guarantee trustee or any other
person or entity.
PERIODIC REPORTS UNDER GUARANTEE
ConocoPhillips will be required to provide annually to the guarantee
trustee a statement as to its performance of its obligations and its compliance
with all conditions under the guarantees.
DUTIES OF GUARANTEE TRUSTEE
The guarantee trustee normally will perform only those duties specifically
set forth in the applicable guarantee. The guarantee does not contain any
implied covenants. If a default occurs on a guarantee, the guarantee trustee
will be required to use the same degree of care and skill in exercise of its
powers under the guarantee as a prudent person would exercise or use under the
circumstances in the conduct of that person's own affairs. The guarantee trustee
will exercise any of its rights or powers under the guarantee at the request or
direction of holders of the applicable series of trust preferred securities only
if it is offered security and indemnity satisfactory to it.
GOVERNING LAW
New York law will govern the guarantees.
RELATIONSHIP AMONG THE TRUST PREFERRED SECURITIES, DEBT SECURITIES AND TRUST
PREFERRED SECURITIES GUARANTEE
When taken together, the terms of the trust preferred securities of a
ConocoPhillips trust, the debt securities held by that trust and the related
preferred securities guarantee provide a full and unconditional guarantee by
ConocoPhillips of the payments due on the trust preferred securities. The
following summary briefly explains the interrelationship between the trust
preferred securities, the debt securities and the guarantee.
THE TRUST WILL BE ABLE TO MAKE PAYMENTS ON THE TRUST PREFERRED SECURITIES ONLY
IF CONOCOPHILLIPS MAKES PAYMENTS ON THE DEBT SECURITIES.
As long as ConocoPhillips makes interest and other payments when due on
the debt securities, the trust will have sufficient funds to make distribution
and other payments when due on the trust preferred securities for the following
reasons:
- the trust will hold debt securities in an aggregate principal amount
equal to the sum of the aggregate stated liquidation amount of the
trust preferred securities and the common securities of the trust;
- the interest rate and payment dates of the debt securities will match
the distribution rate and payment dates of the trust preferred
securities and the common securities of the trust;
- the trustees may not cause or permit the trust to engage in any
activity that is not consistent with its limited purposes of:
- issuing and selling the trust preferred securities and the common
securities of the trust;
- investing the proceeds from the sale of those securities in a
specific series of ConocoPhillips' debt securities; and
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- engaging in only such other activities as are necessary or
incidental to issuing its securities and purchasing and holding
ConocoPhillips' debt securities and as are otherwise specifically
authorized in the declaration of trust; and
- ConocoPhillips has agreed to pay for all of the trust's debts and
obligations, other than with respect to the trust preferred and trust
common securities, and costs and expenses, including the fees and
expenses of the trustees.
CONOCOPHILLIPS WILL GUARANTEE THAT PAYMENTS WILL BE MADE ON THE TRUST PREFERRED
SECURITIES IF CONOCOPHILLIPS MAKES PAYMENTS ON THE DEBT SECURITIES.
If ConocoPhillips makes interest or other payments on the debt securities,
the property trustee will be obligated to make corresponding distribution or
other payments on the trust preferred securities. ConocoPhillips will guarantee
such payments if the trust fails to make them. The guarantee only covers
distributions and other payments on the trust preferred securities if and to the
extent ConocoPhillips has made corresponding payments on the debt securities.
The guarantee trustee will have the right to enforce the guarantee on behalf of
the holders of the trust preferred securities if ConocoPhillips fails to make
any required guarantee payments. If the guarantee trustee fails to enforce the
guarantee, you may institute a legal proceeding directly against ConocoPhillips
to enforce the guarantee trustee's rights under the guarantee. If ConocoPhillips
fails to make a guarantee payment, you may also institute a legal proceeding
directly against ConocoPhillips to enforce the guarantee.
THE PROPERTY TRUSTEE MAY INSTITUTE LEGAL PROCEEDINGS AGAINST CONOCOPHILLIPS IF
CONOCOPHILLIPS FAILS TO MAKE PAYMENTS ON THE DEBT SECURITIES.
If ConocoPhillips does not make interest or other payments on the debt
securities, the trust will not have funds available to make the corresponding
distribution or other payments on the trust preferred securities. The property
trustee, as the holder of the debt securities, will have the right to enforce
ConocoPhillips' obligations on the debt securities if an event of default under
the debt securities occurs. In addition, the holders of a majority in
liquidation amount of the trust preferred securities will have the right to
direct the property trustee with respect to certain matters under the
declaration of trust. If the property trustee fails to enforce its rights, any
holder of trust preferred securities may, to the fullest extent permitted by law
and after a period of 30 days has elapsed from such holder's written request to
the property trustee to enforce such rights, institute a legal proceeding
against ConocoPhillips to enforce such rights.
PLAN OF DISTRIBUTION
We may sell the securities in and outside the United States through
underwriters or dealers, directly to purchasers or through agents. The
prospectus supplement will include the following information:
- the terms of the offering;
- the names of any underwriters or agents;
- the purchase price of the securities from us and, if the purchase price
is not payable in U.S. dollars, the currency or composite currency in
which the purchase price is payable;
- the net proceeds to us from the sale of the securities;
- any delayed delivery arrangements;
- any underwriting discounts, commissions and other items constituting
underwriters' compensation;
- the initial public offering price;
33
- any discounts or concessions allowed or reallowed or paid to dealers;
and
- any commissions paid to agents.
SALE THROUGH UNDERWRITERS OR DEALERS
If we use underwriters in the sale of securities, the underwriters will
acquire the securities for their own account. The underwriters may resell the
securities from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale. Underwriters may offer securities to the public either
through underwriting syndicates represented by one or more managing underwriters
or directly by one or more firms acting as underwriters. Unless we inform you
otherwise in the prospectus supplement, the obligations of the underwriters to
purchase the securities will be subject to conditions, and the underwriters will
be obligated to purchase all the securities if they purchase any of them. The
underwriters may change from time to time any initial public offering price and
any discounts or concessions allowed or reallowed or paid to dealers.
During and after an offering through underwriters, the underwriters may
purchase and sell the securities in the open market. These transactions may
include overallotment and stabilizing transactions and purchases to cover
syndicate short positions created in connection with the offering. The
underwriters may also impose a penalty bid, whereby selling concessions allowed
to syndicate members or other broker-dealers for the offered securities sold for
their account may be reclaimed by the syndicate if such offered securities are
repurchased by the syndicate in stabilizing or covering transactions. These
activities may stabilize, maintain or otherwise affect the market price of the
offered securities, which may be higher than the price that might otherwise
prevail in the open market. If commenced, these activities may be discontinued
at any time.
If we use dealers in the sale of securities, we will sell the securities
to them as principals. They may then resell those securities to the public at
varying prices determined by the dealers at the time of resale. The dealers
participating in any sale of the securities may be deemed to be underwriters
within the meaning of the Securities Act of 1933 with respect to any sale of
those securities. We will include in the prospectus supplement the names of the
dealers and the terms of the transaction.
DIRECT SALES AND SALES THROUGH AGENTS
We may sell the securities directly. In that event, no underwriters or
agents would be involved. We may also sell the securities through agents we
designate from time to time. In the prospectus supplement, we will name any
agent involved in the offer or sale of the securities, and we will describe any
commissions payable by us to the agent. Unless we inform you otherwise in the
prospectus supplement, any agent will agree to use its reasonable best efforts
to solicit purchases for the period of its appointment.
We may sell the securities directly to institutional investors or others
who may be deemed to be underwriters within the meaning of the Securities Act of
1933 with respect to any sale of those securities. We will describe the terms of
any such sales in the prospectus supplement.
DELAYED DELIVERY CONTRACTS
If we so indicate in the prospectus supplement, we may authorize agents,
underwriters or dealers to solicit offers from certain types of institutions to
purchase securities from us at the public offering price under delayed delivery
contracts. These contracts would provide for payment and delivery on a specified
date in the future. The contracts would be subject only to those conditions
described in the prospectus supplement. The prospectus supplement will describe
the commission payable for solicitation of those contracts.
34
GENERAL INFORMATION
We may have agreements with the agents, dealers and underwriters to
indemnify them against civil liabilities, including liabilities under the
Securities Act of 1933, or to contribute with respect to payments that the
agents, dealers or underwriters may be required to make. Agents, dealers and
underwriters may engage in transactions with us or perform services for us in
the ordinary course of their businesses.
LEGAL MATTERS
The validity of the offered securities and other matters in connection
with any offering of the securities will be passed upon for us by Wayne C.
Byers, ConocoPhillips' Senior Counsel, or another of ConocoPhillips' lawyers,
and Baker Botts L.L.P., Houston, Texas, our outside counsel, and for us and the
ConocoPhillips trusts by Richards, Layton & Finger, P.A., Wilmington, Delaware.
Any underwriters will be advised about legal matters relating to any offering by
their own legal counsel.
EXPERTS
The financial statements and the financial statement schedule incorporated
in this prospectus by reference to Conoco's Annual Report on Form 10-K for the
year ended December 31, 2001, have been so incorporated in reliance on the
reports of PricewaterhouseCoopers LLP, independent accountants, given on the
authority of said firm as experts in auditing and accounting.
Ernst & Young LLP, independent auditors, have audited the consolidated
financial statements and schedule of Phillips included in Phillips' Annual
Report on Form 10-K for the year ended December 31, 2001, as amended, as set
forth in their report, which is incorporated by reference in this prospectus.
Phillips' financial statements and schedule are incorporated by reference in
reliance on Ernst & Young LLP's report, given on their authority as experts in
accounting and auditing.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth expenses payable by ConocoPhillips in
connection with the issuance and distribution of the securities being
registered. All the amounts shown are estimates, except for the SEC registration
fee.
SEC registration fee................................... $ 460,000
Printing expenses...................................... *
Legal fees and expenses................................ *
Accounting fees and expenses........................... *
Fees and expenses of trustee and counsel............... *
Rating agency fees..................................... *
Miscellaneous.......................................... *
---------
Total............................................ $ *
=========
- ------------------
* To be filed by amendment.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
ConocoPhillips, Conoco and Phillips
Delaware law permits a corporation to adopt a provision in its certificate
of incorporation eliminating or limiting the personal liability of a director,
but not an officer in his or her capacity as such, to the corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except that such provision shall not limit the liability of a director for (1)
any breach of the director's duty of loyalty to the corporation or its
stockholders, (2) acts or omissions not in good faith or that involve
intentional misconduct or a knowing violation of law, (3) liability under
section 174 of the Delaware General Corporation Law for unlawful payment of
dividends or stock purchases or redemptions, or (4) any transaction from which
the director derived an improper personal benefit. ConocoPhillips' restated
certificate of incorporation provides that, to the fullest extent of Delaware
law, no ConocoPhillips director shall be liable to ConocoPhillips or
ConocoPhillips stockholders for monetary damages for breach of fiduciary duty as
a director. Each of Conoco's and Phillips' certificate of incorporation has
similar provisions with respect to its directors.
Under Delaware law, a corporation may indemnify any individual made a
party or threatened to be made a party to any type of proceeding, other than an
action by or in the right of the corporation, because he or she is or was an
officer, director, employee or agent of the corporation or was serving at the
request of the corporation as an officer, director, employee or agent of another
corporation or entity against expenses, judgments, fines and amounts paid in
settlement actually and reasonably incurred in connection with such proceeding:
(1) if he or she acted in good faith and in a manner he or she reasonably
believed to be in or not opposed to the best interests of the corporation; or
(2) in the case of a criminal proceeding, he or she had no reasonable cause to
believe that his or her conduct was unlawful. A corporation may indemnify any
individual made a party or threatened to be made a party to any threatened,
pending or completed action or suit brought by or in the right of the
corporation because he or she was an officer, director, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation or other entity,
against expenses actually and reasonably incurred in connection with such action
or suit if he or she acted in good faith and in a manner he or she reasonably
believed to be in or not opposed to the best interests of the corporation,
provided that such indemnification will be denied if the individual is found
liable to the corporation unless, in such a case, the court determines the
person is nonetheless entitled to indemnification for such expenses. A
corporation must indemnify a present or former director or officer who
successfully defends himself or herself in a proceeding to which he or she was a
party because he or she was a director or officer of the corporation against
expenses actually and reasonably incurred by him or her. Expenses incurred by an
officer or director, or any employees or agents as deemed appropriate by the
board of directors, in defending civil or criminal proceedings may be paid by
the corporation in
II-1
advance of the final disposition of such proceedings upon receipt of an
undertaking by or on behalf of such director, officer, employee or agent to
repay such amount if it shall ultimately be determined that he or she is not
entitled to be indemnified by the corporation. The Delaware law regarding
indemnification and expense advancement is not exclusive of any other rights
which may be granted by ConocoPhillips' restated certificate of incorporation or
bylaws, a vote of stockholders or disinterested directors, agreement or
otherwise.
Under the Delaware General Corporation Law, termination of any proceeding
by conviction or upon a plea of nolo contendere or its equivalent shall not, of
itself, create a presumption that such person is prohibited from being
indemnified.
ConocoPhillips' bylaws provide for the indemnification and advancement of
expenses of any individual made, or threatened to be made, a party to an action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that he or she is or was a director or officer of
ConocoPhillips or is or was a director or officer of ConocoPhillips serving as
an officer, director, employee or agent of any other enterprise at the request
of ConocoPhillips. Phillips' bylaws have similar provisions. Conoco's bylaws
provide for such indemnification and advancement of expenses if such officer or
director acted in good faith and in a manner he or she reasonably believed to be
in or not opposed to the best interests of Conoco and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his or her
conduct was unlawful. However, neither ConocoPhillips, Conoco nor Phillips will
indemnify a director or officer who commences any proceeding (except for
proceedings to enforce rights of indemnification), unless the commencement of
that proceeding was authorized or consented to by the respective company's board
of directors.
ConocoPhillips has agreed to indemnify each present and former director
and officer of Conoco, Phillips or any of their subsidiaries, against all costs
or expenses, judgments, fines, losses, claims, damages or liabilities in
connection with any claim, action, suit, proceeding or investigation brought
within six years of the closing of the mergers of Conoco and Phillips with
subsidiaries of ConocoPhillips (collectively, the "merger") for acts or
omissions, existing or occurring before the merger, to the fullest extent
permitted under applicable law.
Subject to a cap on premiums, for a period of six years after the merger,
ConocoPhillips has agreed to maintain a policy of directors' and officers'
liability insurance for acts and omissions occurring before the merger with
coverage in an amount and scope at least as favorable as Conoco's and Phillips'
existing directors' and officers' liability insurance coverage.
Notwithstanding any other provision, the treatment of past and present
directors, officers and employees of either Conoco or Phillips and their
respective subsidiaries with respect to elimination of liability,
indemnification, advancement of expenses and liability insurance under the
merger agreement shall be, in the aggregate, no less advantageous to intended
beneficiaries thereof than the corresponding treatment of the past and present
directors, officers and employees of the other company and its subsidiaries.
ConocoPhillips Trusts
Prior to the issuance of trust preferred securities by a ConocoPhillips
trust, the existing declaration of trust pursuant to which such trust is created
will be amended and restated to provide that no trustee, or affiliate of any
trustee, or officer, director, shareholder, member, partner, employee,
representative or agent of any trustee, or employee or agent of such trust or of
any of its affiliates (each, an "Indemnified Person") will be liable for any
loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of such trust and in
a manner such Indemnified Person reasonably believed to be within the scope of
the authority conferred on such Indemnified Person by such amended and restated
declaration of trust or by law, except that an Indemnified Person shall be
liable for any such loss, damage or claim incurred by reason of such Indemnified
Person's gross negligence (or, in the case of the property trustee of such
trust, negligence) or willful misconduct with respect to such acts or omissions.
In addition, such amended and restated declaration of trust shall provide
that, to the fullest extent permitted by applicable law, ConocoPhillips shall
indemnify and hold harmless each Indemnified Person from and against any loss,
liability, expense, damage or claim incurred by such Indemnified Person arising
out of or in connection with the acceptance or administration of the trust under
such declaration of trust or by reason of any act or omission
II-2
performed or omitted by such Indemnified Person in good faith on behalf of such
trust and in a manner such Indemnified Person reasonably believed to be within
the scope of authority conferred on such Indemnified Person by such declaration
of trust, except that no Indemnified Person shall be entitled to be indemnified
in respect of any loss, liability, expense, damage or claim incurred by such
Indemnified Person by reason of gross negligence (or, in the case of the
property trustee of the trust, negligence) or willful misconduct with respect to
such acts or omissions.
ITEM 16. EXHIBITS*
EXHIBIT NO. DESCRIPTION
- ----------- -----------
2.1 -- Agreement and Plan of Merger, dated as of November 18, 2001, among
Conoco Inc., Phillips Petroleum Company, ConocoPhillips (formerly
named CorvettePorsche Corp.), P Merger Corp. (formerly named
Porsche Merger Corp.) and C Merger Corp. (formerly named Corvette
Merger Corp.) (incorporated by reference to Annex A to the Joint
Proxy Statement/Prospectus included in the Registration Statement
of ConocoPhillips on Form S-4, Registration No. 333-74798 (the
"Registration Statement")).
4.1 -- Restated Certificate of Incorporation of ConocoPhillips
(incorporated by reference to Exhibit 3.1 to the Current Report of
ConocoPhillips on Form 8-K filed with the SEC on August 30, 2002,
SEC File No. 000-49987 (the "Form 8-K")).
4.2 -- By-laws of ConocoPhillips (incorporated by reference to Exhibit
3.3 to the Form 8-K).
4.3 -- Specimen certificate representing common stock, par value $.01 per
share, of ConocoPhillips (incorporated by reference to Exhibit 4.1
to the Registration Statement).
4.4 -- Rights Agreement, dated as of June 30, 2002, between
ConocoPhillips and Mellon Investor Services LLC, as rights agent,
which includes as Exhibit A the form Certificate of Designations
of Series A Junior Participating Preferred Stock, as Exhibit B the
form of Rights Certificate and as Exhibit C the Summary of Rights
to Purchase Preferred Stock (incorporated by reference to Exhibit
4.1 to the Form 8-K).
4.5 -- Indenture, dated as of October 9, 2002, among ConocoPhillips, as
issuer, Conoco Inc. and Phillips Petroleum Company, as guarantors,
and The Bank of New York, as trustee, in respect of senior debt
securities of ConocoPhillips (the "Senior Indenture").
4.6 -- Form of Indenture between ConocoPhillips and The Bank of New York,
as trustee, in respect of subordinated debt securities of
ConocoPhillips (the "Subordinated Indenture").
4.7.1 -- Declaration of Trust of ConocoPhillips Trust I.
4.7.2 -- Declaration of Trust of ConocoPhillips Trust II.
4.8 -- Form of Amended and Restated Declaration of Trust.
4.9.1 -- Certificate of Trust of ConocoPhillips Trust I.
4.9.2 -- Certificate of Trust of ConocoPhillips Trust II.
4.10 -- Form of Trust Preferred Security (included in Exhibit 4.8).
4.11 -- Form of Trust Preferred Securities Guarantee of ConocoPhillips.
II-3
5.1 -- Opinion of Baker Botts L.L.P. with respect to legality of the
securities offered hereby (other than the trust preferred
securities of ConocoPhillips Trust I and ConocoPhillips Trust II).
5.2.1 -- Opinion of Richards, Layton & Finger, P.A. with respect to the
legality of the trust preferred securities of ConocoPhillips Trust
I.
5.2.2 -- Opinion of Richards, Layton & Finger, P.A. with respect to the
legality of the trust preferred securities of ConocoPhillips Trust
II.
+12.1 -- Computation of ratio of earnings to fixed charges of Conoco Inc.
+12.2 -- Computation of ratio of earnings to fixed charges and ratio of
earnings to combined fixed charges and preferred stock dividends
of Phillips Petroleum Company.
+12.3 -- Computation of pro forma ratio of earnings to fixed charges and
pro forma ratio of earnings to combined fixed charges and
preferred stock dividends of ConocoPhillips.
23.1 -- Consent of PricewaterhouseCoopers LLP.
23.2 -- Consent of Ernst & Young LLP.
23.3 -- Consent of Baker Botts L.L.P. (contained in Exhibit 5.1).
23.4 -- Consent of Richards, Layton & Finger, P.A. (contained in Exhibits
5.2.1 and 5.2.2).
24.1 -- Powers of Attorney of directors and officers of Conoco Inc. and
Phillips Petroleum Company (included on the signature pages of the
Registration Statement).
24.2 -- Powers of Attorney of directors and officers of ConocoPhillips.
25.1 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of The Bank of New York, as
trustee under the Senior Indenture.
25.2 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of The Bank of New York, as
trustee under the Subordinated Indenture.
25.3.1 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of The Bank of New York, as
property trustee, relating to ConocoPhillips Trust I.
25.3.2 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of The Bank of New York, as
property trustee, relating to ConocoPhillips Trust II.
25.4.1 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of The Bank of New York, as
guarantee trustee, relating to ConocoPhillips Trust I.
25.4.2 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of The Bank of New York, as
guarantee trustee, relating to ConocoPhillips Trust II.
- -----------------
* ConocoPhillips will file as an exhibit to a Current Report on Form 8-K (i)
any underwriting, remarketing or agency agreement relating to the
securities offered hereby, (ii) the instruments setting forth the terms of
any debt securities, preferred stock, warrants, depositary shares or stock
purchase contracts, (iii) any additional
II-4
required opinions of counsel with respect to legality of the securities
offered hereby and (iv) any required opinion of counsel to ConocoPhillips
as to certain tax matters relative to the securities offered hereby.
+ To be filed by amendment.
ITEM 17. UNDERTAKINGS
(a) The undersigned Registrants hereby undertake:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change in the
information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b)
if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration
Fee" table in the effective Registration Statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
provided, however, that the undertakings set forth in paragraphs
(a)(1)(i) and (a)(1)(ii) above do not apply if the information
required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by a Registrant
pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrants hereby undertake that, for purposes of
determining any liability under the Securities Act, each filing of a
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of
the Exchange Act (and, where applicable, each filing of an employee
benefit plan's annual report pursuant to Section 15(d) of the Exchange
Act) that is incorporated by reference in the Registration Statement shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrants pursuant to the foregoing provisions, or otherwise, each
Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other
than the payment by a Registrant of expenses incurred or paid by a
director, officer or controlling person of such Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in
II-5
connection with the securities being registered, such Registrant will,
unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final
adjudication of such issue.
(d) The undersigned Registrants hereby undertake that:
(1) For purposes of determining any liability under the Securities Act,
the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained
in a form of prospectus filed by the Registrants pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed
to be part of this Registration Statement as of the time it was
declared effective.
(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
II-6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the undersigned Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Houston, State of Texas, on November
12, 2002.
CONOCOPHILLIPS
By: /s/ John A. Carrig
------------------------------------
John A. Carrig
Executive Vice President, Finance,
and Chief Financial Officer
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON NOVEMBER 12, 2002.
SIGNATURE TITLE
--------- -----
/s/ J. J. Mulva* Chief Executive Officer, President and Director
- -------------------------------------- (Principal Executive Officer)
J. J. Mulva
/s/ John A. Carrig Executive Vice President, Finance, and
- -------------------------------------- Chief Financial Officer
John A. Carrig (Principal Financial Officer)
/s/ Rand C. Berney* Vice President and Controller
- -------------------------------------- (Principal Accounting Officer)
Rand C. Berney
/s/ Archie W. Dunham** Chairman of the Board and Director
- --------------------------------------
Archie W. Dunham
/s/ Richard A. Auchinleck** Director
- --------------------------------------
Richard A. Auchinleck
/s/ Norman R. Augustine* Director
- --------------------------------------
Norman R. Augustine
/s/ David L. Boren* Director
- --------------------------------------
David L. Boren
/s/ Kenneth M. Duberstein** Director
- --------------------------------------
Kenneth M. Duberstein
/s/ Ruth R. Harkin** Director
- --------------------------------------
Ruth R. Harkin
/s/ Larry D. Horner* Director
- --------------------------------------
Larry D. Horner
/s/ Charles C. Krulak** Director
- --------------------------------------
Charles C. Krulak
/s/ Frank A. McPherson** Director
- --------------------------------------
Frank A. McPherson
/s/ William K. Reilly** Director
- --------------------------------------
William K. Reilly
/s/ William R. Rhodes** Director
- --------------------------------------
William R. Rhodes
/s/ J. Stapleton Roy* Director
- --------------------------------------
J. Stapleton Roy
/s/ Randall L. Tobias* Director
- --------------------------------------
Randall L. Tobias
/s/ Victoria J. Tschinkel* Director
- --------------------------------------
Victoria J. Tschinkel
/s/ Kathryn C. Turner* Director
- --------------------------------------
Kathryn C. Turner
*By: /s/ John A. Carrig
----------------------------------
John A. Carrig
Attorney-in-fact
**By: /s/ Rick A. Harrington
---------------------------------
Rick A. Harrington
Attorney-in-fact
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the undersigned Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Houston, State of Texas, on November
12, 2002.
CONOCO INC.
By: /s/ John A. Carrig
---------------------------------------
John A. Carrig
Executive Vice President, Finance, and
Chief Financial Officer
POWER OF ATTORNEY
Each person whose signature appears below appoints John A. Carrig, Rick A.
Harrington and Rand C. Berney, and each of them, severally, as his or her true
and lawful attorney or attorneys-in-fact and agent or agents, each of whom shall
be authorized to act with or without the other, with full power of substitution
and resubstitution, for him or her and in his or her name, place and stead in
his or her capacity as a director or officer or both, as the case may be, of
Conoco Inc., to sign any and all amendments (including post-effective
amendments) to this Registration Statement and any registration statement of the
type contemplated by Rule 462(b) under the Securities Act of 1933, as amended
(the "Securities Act"), and all documents or instruments necessary or
appropriate to enable Conoco Inc. to comply with the Securities Act, and to file
the same with the Securities and Exchange Commission, with full power and
authority to each of said attorneys-in-fact and agents to do and perform in the
name and on behalf of each such director or officer, or both, as the case may
be, each and every act whatsoever that is necessary, appropriate or advisable in
connection with any or all of the above-described matters and to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them or their
substitutes, may lawfully do or cause to be done by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON NOVEMBER 12, 2002.
SIGNATURE TITLE
--------- -----
/s/ J. J. Mulva President and Chief Executive Officer
- ------------------------------ (Principal Executive Officer)
J. J. Mulva
/s/ John A. Carrig Executive Vice President, Finance, and
- ------------------------------ Chief Financial Officer and Director
John A. Carrig (Principal Financial Officer)
/s/ Rand C. Berney Vice President and Controller
- ------------------------------ (Principal Accounting Officer)
Rand C. Berney
/s/ Rick A. Harrington Director
- ------------------------------
Rick A. Harrington
/s/ Thomas C. Knudson Director
- ------------------------------
Thomas C. Knudson
/s/ John E. Lowe Director
- ------------------------------
John E. Lowe
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the undersigned Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Houston, State of Texas, on November
12, 2002.
PHILLIPS PETROLEUM COMPANY
By: /s/ John A. Carrig
---------------------------------------
John A. Carrig
Executive Vice President, Finance, and
Chief Financial Officer
POWER OF ATTORNEY
Each person whose signature appears below appoints John A. Carrig, Rick A.
Harrington and Rand C. Berney, and each of them, severally, as his or her true
and lawful attorney or attorneys-in-fact and agent or agents, each of whom shall
be authorized to act with or without the other, with full power of substitution
and resubstitution, for him or her and in his or her name, place and stead in
his or her capacity as a director or officer or both, as the case may be, of
Phillips Petroleum Company, to sign any and all amendments (including
post-effective amendments) to this Registration Statement and any registration
statement of the type contemplated by Rule 462(b) under the Securities Act of
1933, as amended (the "Securities Act"), and all documents or instruments
necessary or appropriate to enable Phillips Petroleum Company to comply with the
Securities Act, and to file the same with the Securities and Exchange
Commission, with full power and authority to each of said attorneys-in-fact and
agents to do and perform in the name and on behalf of each such director or
officer, or both, as the case may be, each and every act whatsoever that is
necessary, appropriate or advisable in connection with any or all of the
above-described matters and to all intents and purposes as he or she might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents or any of them or their substitutes, may lawfully
do or cause to be done by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON NOVEMBER 12, 2002.
SIGNATURE TITLE
--------- -----
/s/ J. J. Mulva President and Chief Executive Officer
- ------------------------------ (Principal Executive Officer)
J. J. Mulva
/s/ John A. Carrig Executive Vice President, Finance, and
- ------------------------------ Chief Financial Officer and Director
John A. Carrig (Principal Financial Officer)
/s/ Rand C. Berney Vice President and Controller
- ------------------------------ (Principal Accounting Officer)
Rand C. Berney
/s/ Rick A. Harrington Director
- ------------------------------
Rick A. Harrington
/s/ Thomas C. Knudson Director
- ------------------------------
Thomas C. Knudson
/s/ John E. Lowe Director
- ------------------------------
John E. Lowe
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the undersigned Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Houston, State of Texas, on November
12, 2002.
CONOCOPHILLIPS TRUST I
By: CONOCOPHILLIPS, as Sponsor
By: /s/ John A. Carrig
---------------------------------------
John A. Carrig
Executive Vice President, Finance, and
Chief Financial Officer
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the undersigned Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Houston, State of Texas, on November
12, 2002.
CONOCOPHILLIPS TRUST II
By: CONOCOPHILLIPS, as Sponsor
By: /s/ John A. Carrig
--------------------------------------
John A. Carrig
Executive Vice President, Finance, and
Chief Financial Officer
EXHIBIT INDEX*
EXHIBIT NO. DESCRIPTION
- ----------- -----------
2.1 -- Agreement and Plan of Merger, dated as of November 18, 2001, among
Conoco Inc., Phillips Petroleum Company, ConocoPhillips (formerly
named CorvettePorsche Corp.), P Merger Corp. (formerly named
Porsche Merger Corp.) and C Merger Corp. (formerly named Corvette
Merger Corp.) (incorporated by reference to Annex A to the Joint
Proxy Statement/Prospectus included in the Registration Statement
of ConocoPhillips on Form S-4, Registration No. 333-74798 (the
"Registration Statement")).
4.1 -- Restated Certificate of Incorporation of ConocoPhillips
(incorporated by reference to Exhibit 3.1 to the Current Report of
ConocoPhillips on Form 8-K filed with the SEC on August 30, 2002,
SEC File No. 000-49987 (the "Form 8-K")).
4.2 -- By-laws of ConocoPhillips (incorporated by reference to Exhibit
3.3 to the Form 8-K).
4.3 -- Specimen certificate representing common stock, par value $.01 per
share, of ConocoPhillips (incorporated by reference to Exhibit 4.1
to the Registration Statement).
4.4 -- Rights Agreement, dated as of June 30, 2002, between
ConocoPhillips and Mellon Investor Services LLC, as rights agent,
which includes as Exhibit A the form Certificate of Designations
of Series A Junior Participating Preferred Stock, as Exhibit B the
form of Rights Certificate and as Exhibit C the Summary of Rights
to Purchase Preferred Stock (incorporated by reference to Exhibit
4.1 to the Form 8-K).
4.5 -- Indenture, dated as of October 9, 2002, among ConocoPhillips, as
issuer, Conoco Inc. and Phillips Petroleum Company, as guarantors,
and The Bank of New York, as trustee, in respect of senior debt
securities of ConocoPhillips (the "Senior Indenture").
4.6 -- Form of Indenture between ConocoPhillips and The Bank of New York,
as trustee, in respect of subordinated debt securities of
ConocoPhillips (the "Subordinated Indenture").
4.7.1 -- Declaration of Trust of ConocoPhillips Trust I.
4.7.2 -- Declaration of Trust of ConocoPhillips Trust II.
4.8 -- Form of Amended and Restated Declaration of Trust.
4.9.1 -- Certificate of Trust of ConocoPhillips Trust I.
4.9.2 -- Certificate of Trust of ConocoPhillips Trust II.
4.10 -- Form of Trust Preferred Security (included in Exhibit 4.8).
4.11 -- Form of Trust Preferred Securities Guarantee of ConocoPhillips.
5.1 -- Opinion of Baker Botts L.L.P. with respect to legality of the
securities offered hereby (other than the trust preferred
securities of ConocoPhillips Trust I and ConocoPhillips Trust II).
5.2.1 -- Opinion of Richards, Layton & Finger, P.A. with respect to the
legality of the trust preferred securities of ConocoPhillips Trust
I.
5.2.2 -- Opinion of Richards, Layton & Finger, P.A. with respect to the
legality of the trust preferred securities of ConocoPhillips Trust
II.
+12.1 -- Computation of ratio of earnings to fixed charges of Conoco Inc.
+12.2 -- Computation of ratio of earnings to fixed charges and ratio of
earnings to combined fixed charges and preferred stock dividends
of Phillips Petroleum Company.
+12.3 -- Computation of pro forma ratio of earnings to fixed charges and
pro forma ratio of earnings to combined fixed charges and
preferred stock dividends of ConocoPhillips.
23.1 -- Consent of PricewaterhouseCoopers LLP.
23.2 -- Consent of Ernst & Young LLP.
23.3 -- Consent of Baker Botts L.L.P. (contained in Exhibit 5.1).
23.4 -- Consent of Richards, Layton & Finger, P.A. (contained in Exhibits
5.2.1 and 5.2.2).
24.1 -- Powers of Attorney of directors and officers of Conoco Inc. and
Phillips Petroleum Company (included on the signature pages of the
Registration Statement).
24.2 -- Powers of Attorney of directors and officers of ConocoPhillips.
25.1 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of The Bank of New York, as
trustee under the Senior Indenture.
25.2 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of The Bank of New York, as
trustee under the Subordinated Indenture.
25.3.1 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of The Bank of New York, as
property trustee, relating to ConocoPhillips Trust I.
25.3.2 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of The Bank of New York, as
property trustee, relating to ConocoPhillips Trust II.
25.4.1 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of The Bank of New York, as
guarantee trustee, relating to ConocoPhillips Trust I.
25.4.2 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of The Bank of New York, as
guarantee trustee, relating to ConocoPhillips Trust II.
- -----------------
* ConocoPhillips will file as an exhibit to a Current Report on Form 8-K (i)
any underwriting, remarketing or agency agreement relating to the
securities offered hereby, (ii) the instruments setting forth the terms of
any debt securities, preferred stock, warrants, depositary shares or stock
purchase contracts, (iii) any additional required opinions of counsel with
respect to legality of the securities offered hereby and (iv) any required
opinion of counsel to ConocoPhillips as to certain tax matters relative to
the securities offered hereby.
+ To be filed by amendment.