EXHIBIT 1.2
Newfield Exploration Company
PRICING AGREEMENT
August 8, 2002
UBS Warburg LLC
J. P. Morgan Securities Inc.
Wachovia Securities, Inc.
BNY Capital Markets, Inc.
Credit Lyonnais Securities (USA) Inc.
Fleet Securities, Inc.
c/o UBS Warburg LLC
677 Washington Blvd.
Stamford, CT 06901
Ladies and Gentlemen:
Newfield Exploration Company, a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein and in the
Underwriting Agreement, dated August 8, 2002 (the "Underwriting Agreement"), to
issue and sell to the Underwriters named in Schedule I hereto (the
"Underwriters") the Designated Securities specified in Schedule II hereto (the
"Designated Securities"). Each of the provisions of the Underwriting Agreement
is incorporated herein by reference in its entirety, and shall be deemed to be a
part of this Agreement to the same extent as if such provisions had been set
forth in full herein; and each of the representations and warranties set forth
therein shall be deemed to have been made at and as of the date of this Pricing
Agreement, except that each representation and warranty which refers to the
Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a
representation or warranty as of the date of the Underwriting Agreement in
relation to the Prospectus (as therein defined), and also a representation and
warranty as of the date of this Pricing Agreement in relation to the Prospectus
as amended or supplemented relating to the Designated Securities which are the
subject of this Pricing Agreement. Each reference to the Representatives herein
and in the provisions of the Underwriting Agreement so incorporated by reference
shall be deemed to refer to you. Unless otherwise defined herein, terms defined
in the Underwriting Agreement are used herein as therein defined. The
Representatives designated to act on behalf of the Representatives and on behalf
of each of the Underwriters of the Designated Securities pursuant to Section 12
of the Underwriting Agreement and the address of the Representatives referred to
in such Section 12 are set forth in Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
The Company hereby confirms its engagement of Wachovia Securities, Inc.
("Wachovia") as, and Wachovia hereby confirms its agreement with the Company to
render services as, a "qualified independent underwriter," within the meaning of
Section (b)(15) of
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Rule 2720 of the Conduct Rules of the NASD with respect to the offering and sale
of the Designated Securities. Wachovia agrees in acting as a qualified
independent underwriter to undertake the legal responsibilities and liabilities
of an underwriter under the Act, including those in Section 11 of the Act.
Wachovia, solely in its capacity as qualified independent underwriter and not
otherwise, is referred to in the Underwriting Agreement as the "Independent
Underwriter." The yield at which the Designated Securities will be sold to the
public will be at a yield no less than the yield recommended by Wachovia acting
as Independent Underwriter.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the time and place
and at the purchase price to the Underwriters set forth in Schedule II hereto,
the principal amount of Designated Securities set forth opposite the name of
such Underwriter in Schedule I hereto.
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If the foregoing is in accordance with your understanding, please sign
and return to us five counterparts hereof, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding agreement between each of the Underwriters
and the Company. It is understood that your acceptance of this letter on behalf
of each of the Underwriters is or will be pursuant to the authority set forth in
a form of Agreement among Underwriters, the form of which shall be submitted to
the Company for examination, upon request, but without warranty on the part of
the Representatives as to the authority of the signers thereof.
Very truly yours,
Newfield Exploration Company
By: /s/ Brian L. Rickmers
--------------------------------------
Brian L. Rickmers
Controller
Accepted as of the date hereof:
UBS Warburg LLC
By: /s/ Todd M. Tomlin
------------------------------------
Todd M. Tomlin
Director
(On behalf of each of the Underwriters)
Wachovia Securities, Inc.
By:/s/ Paul N. Riddle
------------------------------------
Paul N. Riddle
Managing Director
(In its capacity as qualified independent underwriter)
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SCHEDULE I
PRINCIPAL AMOUNT OF
DESIGNATED SECURITIES
TO BE
PURCHASED
---------
UNDERWRITER
UBS Warburg LLC.................................... $150,000,000
J. P. Morgan Securities Inc........................ 68,750,000
Wachovia Securities, Inc........................... 12,500,000
BNY Capital Markets, Inc........................... 6,250,000
Credit Lyonnais Securities (USA) Inc............... 6,250,000
Fleet Securities, Inc.............................. 6,250,000
------------
Total.............................................. $250,000,000
============
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SCHEDULE II
TITLE OF DESIGNATED SECURITIES:
8 3/8% Senior Subordinated Notes due 2012
AGGREGATE PRINCIPAL AMOUNT:
$250,000,000
PRICE TO PUBLIC:
99.168% of the principal amount of the Designated Securities, plus accrued
interest, if any, from original issuance
UNDERWRITING DISCOUNT:
2.250% of the principal amount of the Designated Securities
PURCHASE PRICE BY UNDERWRITERS:
96.918% of the principal amount of the Designated Securities
FORM OF DESIGNATED SECURITIES:
Book-entry only form represented by one or more global securities deposited
with The Depository Trust Company ("DTC") or its designated custodian, to be
made available for checking by the Representatives at least twenty-four hours
prior to the Time of Delivery at the office of DTC or its designated custodian
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
Federal (same day) funds
PAYMENT OF FUNDS INTO ESCROW ACCOUNT:
The net proceeds (before the Company's expenses) of the purchase price will be
paid by the Underwriters directly to the Escrow Account maintained by Wachovia
Bank, National Association, as Escrow Agent, for distribution pursuant to the
Escrow Agreement dated as of the Closing Dated under which the Escrow Agent and
UBS Warburg LLC, as representative of the Underwriters, are parties
TIME OF DELIVERY:
10 a.m. (New York City time), August 13, 2002
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INDENTURE:
Indenture dated December 10, 2001, between the Company and Wachovia Bank,
National Association, as Trustee, as supplemented by the First Supplemental
Indenture to be dated as of August 13, 2002
MATURITY:
August 15, 2012
INTEREST RATE:
8 3/8%
INTEREST PAYMENT DATES:
February 15 and August 15 of each year commencing on February 15, 2003
OPTIONAL REDEMPTION PROVISIONS:
o Prior to August 15, 2007, make-whole at Treasuries plus 50 basis points
o On and after August 15, 2007, at the redemption prices set forth below if
redeemed during the 12-month period commencing on August 15 of the years set
forth below:
2007 . . . . . . . . . . . . . . . . . . .104.188%
2008 . . . . . . . . . . . . . . . . . . .102.792%
2009 . . . . . . . . . . . . . . . . . . .101.405%
2010 and thereafter . . . . . . . . . . .100.000%
o Prior to August 15, 2007, up to 35% of the aggregate principal amount of the
Designated Securities at a redemption price of 108.375% with the proceeds of
one or more underwritten offerings of the Company's common stock under an
effective registration statement
SPECIAL MANDATORY REDEMPTION:
o 101% plus accrued and unpaid interest
o Occurs if EEX Acquisition is not completed by December 31, 2002 or earlier if
EEX Acquisition is terminated or abandoned.
SINKING FUND PROVISIONS:
No sinking fund provisions
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CLOSING LOCATION FOR DELIVERY OF DESIGNATED SECURITIES:
Offices of Baker Botts L.L.P., One Shell Plaza, Houston, Texas 77002
NAME AND ADDRESS OF REPRESENTATIVES:
UBS Warburg LLC
Address for notices:
UBS Warburg LLC
677 Washington Blvd.
Stamford, CT 06901
Attention: Ed Massaro, Managing Director High Yield Capital Markets
Facsimile: 203.719.5753
with a copy to:
UBS Warburg LLC
677 Washington Blvd.
Stamford, CT 06901
Attention: Legal Affairs (Debt)
Facsimile: 203.719.0680
LISTING OF DESIGNATED SECURITIES:
None
BLACKOUT PROVISIONS:
Until Closing
UNDERWRITER PROVIDED INFORMATION:
The only information provided by the Underwriters and Representatives is (i) the
table set forth in the first paragraph and (ii) the third and fourth paragraphs,
under the caption "Underwriting" in the Prospectus.
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