Exhibit 1.1
EXECUTION VERSION
$450,000,000
Pioneer Natural Resources Company
7.50% Senior Notes due 2020
Debt Securities
Underwriting Agreement
November 9, 2009
Deutsche Bank Securities Inc.
J.P. Morgan Securities Inc.
Wells Fargo Securities, LLC
As Representatives of the several Underwriters
c/o Deutsche Bank Securities Inc.
60 Wall Street, New York, New York 10005
Credit Suisse Securities (USA) LLC
As qualified independent underwriter
Eleven Madison Avenue, New York, New York 10010
Ladies and Gentlemen:
Pioneer Natural Resources Company, a Delaware corporation (the “
Company
”), proposes to sell to
the several underwriters named in
Schedule II
hereto (the “
Underwriters
”), for whom
Deutsche Bank Securities Inc., J.P. Morgan Securities Inc. and Wells Fargo Securities, LLC (the
“
Representatives
”) are acting as representatives, the principal amount of its 7.50% Senior Notes
due 2020, as described in
Schedule III
hereto (the “
Securities
”), to be issued under an
indenture dated as of January 22, 2008, as amended and supplemented (the “
Original Indenture
”),
between Wells Fargo Bank, National Association, as trustee (the “
Trustee
”) and the Company, as to
be supplemented with respect to the Securities by the Second Supplemental Indenture to be dated as
of the Closing Date (as defined below), among the Trustee, the Company and Pioneer Natural
Resources USA, Inc. (the “
Second Supplemental Indenture
” and, together with the Original Indenture,
the “
Indenture
”). To the extent there are no additional Underwriters listed on
Schedule II
other than you, the term Representative as used herein shall mean you, as Underwriters, and the
terms Representative and Underwriters shall mean either the singular or plural as the context
requires. Any reference herein to the Registration Statement, the Basic Prospectus, any
Preliminary Final Prospectus or the Final Prospectus shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 that were filed under the Exchange Act on or before the
Effective Date of the Registration Statement or the issue date of the Basic Prospectus, any
Preliminary Final Prospectus or the Final Prospectus, as the case may be; and any reference herein
to the terms “amend”, “amendment” or “supplement” with respect to the Registration Statement, the
Basic Prospectus, any Preliminary Final Prospectus or the Final Prospectus shall be deemed to refer
to and include the filing of any document under the Exchange Act after the Effective Date of the
Registration Statement or the issue date of the Basic Prospectus, any Preliminary Final Prospectus
or the Final Prospectus, as the case may be, deemed to be incorporated therein by reference.
Certain terms used herein are defined in Section 20 hereof.
The Company and the Underwriters, in accordance with the requirements of Rule 2720(a) (“
Rule
2720(a)
”) of the Financial Industry Regulatory Authority, Inc. (“
FINRA
”) and subject to the terms
and conditions stated herein, also hereby confirm the engagement of the services of Credit Suisse
Securities (USA) LLC as a “qualified independent underwriter” within the meaning of Rule
2720(f)(12) in connection with the offering and sale of the Securities. Credit Suisse Securities
(USA) LLC, in its capacity as qualified independent underwriter and not otherwise, is referred to
herein as the “
QIU
”.
1.
Representations and Warranties
. The Company represents and warrants to, and agrees
with, each Underwriter as set forth below in this Section 1 that as of the Execution Time, Initial
Sale Time and the Closing Date:
(a)
Filing and Effectiveness of Registration Statement
. The Company has filed with
the Commission a registration statement on Form S-3 (No. 333 — 148655), including a related
prospectus or prospectuses, covering the registration of the Securities under the Act, which has
become effective. “
Registration Statement
” at any particular time means such registration
statement in the form then filed with the Commission, including any amendment thereto, any document
incorporated by reference therein and all 430B Information and all 430C Information with respect to
such registration statement, that in any case has not been superseded or modified. “
Registration
Statement
” without reference to a time means the Registration Statement as of the Initial Sale
Time. For purposes of this definition, 430B Information shall be considered to be included in the
Registration Statement as of the time specified in Rule 430B;
(b)
Incorporated Documents
. The documents included or incorporated by reference in
the Registration Statement and the Final Prospectus, when they became effective or were filed with
the Commission, as the case may be, conformed in all material respects to any applicable
requirements of the Exchange Act and the rules and regulations of the Commission thereunder and any
further documents so filed and incorporated by reference in the Final Prospectus or any amendment
or supplement thereto, when such documents are filed with the Commission, will conform in all
material respects to the requirements of the Exchange Act;
(c)
Disclosure Conformity
. On the Effective Date, the Registration Statement did, and
on the date it was first filed and on the Closing Date, the Final Prospectus did and will conform
in all material respects to the requirements of the Act and the Trust Indenture Act and the rules
and regulations of the Commission under both the Act and the Trust Indenture Act; on the date each
was first filed, the Basic Prospectus did and the Final Prospectus will, and on the Closing Date each will, conform in all
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material respects with the applicable requirements of the rules and regulations of the Commission; the
Registration Statement, as of the Effective Date, and at the Execution Time, did not and will not
contain an untrue statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, and the Basic Prospectus
as of its filing date, and at the Execution Time, did not and will not contain an untrue statement
of a material fact or omit to state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading; and the Final Prospectus
will not, as of its filing date and as of the Closing Date, contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were made, not misleading;
provided, however, that this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information furnished in writing to the
Company by or on behalf of any Underwriter through the Representatives specifically for inclusion
in the Registration Statement, the Final Prospectus, or to the Form T-1 of the Trustee, it being
understood and agreed that the only such information furnished by or on behalf of any Underwriter
is that described in Section 9(c) hereof;
(d)
Automatic Shelf Registration Statement
. (i)
Well-Known Seasoned Issuer Status
.
(A) At the time of initial filing of the Registration Statement, (B) at the time of the most
recent amendment thereto for the purposes of complying with Section 10(a)(3) of the Act (whether
such amendment was by post-effective amendment, incorporated report filed pursuant to Section 13 or
15(d) of the Exchange Act or form of prospectus), and (C) at the time the Company or any person
acting on its behalf (within the meaning, for this clause only, of Rule 163(c)) made any offer
relating to the Securities in reliance on the exemption of Rule 163, the Company was a “well-known
seasoned issuer” as defined in Rule 405, including not having been an “ineligible issuer” as
defined in Rule 405;
(ii)
Effectiveness of Automatic Shelf Registration Statement
. The Registration Statement
is an “automatic shelf registration statement,” as defined in Rule 405, that initially became
effective within three years of the date of this Agreement. If immediately prior to the
Renewal Deadline, any of the Securities remain unsold by the Underwriters, the Company will,
prior to the Renewal Deadline file, if it has not already done so and is eligible to do so, a
new automatic shelf registration statement relating to the Securities, in a form satisfactory
to the Representatives. If the Company is no longer eligible to file an automatic shelf
registration statement, the Company will, prior to the Renewal Deadline, if it has not already
done so, file a new shelf registration statement relating to the Securities, in a form
satisfactory to the Representatives, and will use its best efforts to cause such registration
statement to be declared effective within 180 days after the Renewal Deadline. The Company
will take all other action necessary or appropriate to permit the public offering and sale of
the Securities to continue as contemplated in the expired registration statement relating to
the Securities. References herein to the Registration Statement shall include such new
automatic shelf registration statement or such new shelf registration statement, as the case
may be.
(iii)
Eligibility to Use Automatic Shelf Registration Form
. The Company has not received from the Commission any notice pursuant to Rule
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401(g)(2)
objecting to use of the automatic shelf registration statement form. If at any time when the
Securities remain unsold by the Underwriters, the Company receives from the Commission a notice
pursuant to Rule 401(g)(2) or otherwise ceases to be eligible to use the automatic shelf
registration statement form, the Company will (i) promptly notify the Representatives, (ii)
promptly file a new registration statement or post-effective amendment on the proper form
relating to the Securities, in a form satisfactory to the Representatives, (iii) use its
reasonable best efforts to cause such registration statement or post-effective amendment to be
declared effective as soon as practicable, and (iv) promptly notify the Representatives of such
effectiveness. The Company will take all other action necessary or appropriate to permit the
public offering and sale of the Securities to continue as contemplated in the registration
statement that was the subject of the Rule 401(g)(2) notice or for which the Company has
otherwise become ineligible. References herein to the Registration Statement shall include
such new registration statement or post-effective amendment, as the case may be.
(iv)
Filing Fees
. The Company has paid or shall pay the required Commission filing fees
relating to the Securities within the time required by Rule 456(b)(1) without regard to the
proviso therein and otherwise in accordance with Rules 456(b) and 457(r).
(e)
Disclosure Package
. As of the Initial Sale Time and as of the Closing Date, none
of (i) the Disclosure Package or (ii) any individual Limited Use Issuer Free Writing Prospectus,
when considered together with the Disclosure Package, included or will include any untrue statement
of a material fact or omitted or will omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were made, not
misleading. The preceding sentence does not apply to statements in or omissions from any Statutory
Prospectus or any Issuer Free Writing Prospectus made in reliance upon and in conformity with
information furnished in writing to the Company or on behalf of any Underwriter through the
Representatives specifically for inclusion therein, it being understood and agreed that the only
such information furnished by any Underwriter consists of the information described as such in
Section 9(c) hereof;
(f)
Company not Ineligible Issuer
. (i) At the earliest time after the filing of the
Registration Statement that the Company or another offering participant made a
bona fide
offer
(within the meaning of Rule 164(h)(2) under the Act) of the Securities and (ii) as of the Execution
Time (with such date being used as the determination date for purposes of this clause (ii)), the
Company was not and is not an Ineligible Issuer (as defined in Rule 405 under the Act) including
(x) the Company or any other subsidiary in the preceding three years not having been convicted of a
felony or misdemeanor or having been made the subject of a judicial or administrative decree or
order as described in Rule 405 and (y) the Company in the preceding three years not having been the
subject of a bankruptcy petition or insolvency or similar proceeding, not having had a registration
statement be the subject of a proceeding under Section 8 of the Act and not being the subject of a
proceeding under Section 8A of the Act in connection with the offering of the Securities, all as
described in Rule 405, without taking account of any determination by the Commission pursuant to Rule 405 under the Act that it is not
necessary that the Company be considered an Ineligible Issuer;
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(g)
Issuer Free Writing Prospectuses
. Each Issuer Free Writing Prospectus, as of its
issue date and at all subsequent times through the completion of the public offer and sale of the
Securities or until any earlier date that the Company notified or notifies the Representatives as
described in the next sentence, did not, does not and will not include any information that
conflicted, conflicts or will conflict with the information then contained in the Registration
Statement, including any document incorporated therein and any prospectus supplement deemed to be a
part thereof that has not been superseded or modified. If at any time following issuance of an
Issuer Free Writing Prospectus there occurred or occurs an event or development as a result of
which such Issuer Free Writing Prospectus conflicted or would conflict with the information then
contained in the Registration Statement or as a result of which such Issuer Free Writing
Prospectus, if republished immediately following such event or development, would include an untrue
statement of a material fact or omitted or would omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances then prevailing, not misleading,
(i) the Company has promptly notified or will notify promptly the Representatives so that any use
of the Disclosure Package may cease until it is amended or supplemented and (ii) the Company has
promptly amended or will promptly amend or supplement such Issuer Free Writing Prospectus to
eliminate or correct such conflict, untrue statement or omission. The foregoing two sentences do
not apply to statements in or omissions from the Disclosure Package made in reliance upon and in
conformity with information furnished in writing to the Company by or on behalf of any Underwriter
through the Representatives specifically for use therein;
(h)
Company Good Standing
. The Company has been duly incorporated and is validly
existing as a corporation under the laws of the State of Delaware with full corporate power and
authority to own or lease, as the case may be, and to operate its properties and conduct its
business as described in the Disclosure Package and the Final Prospectus, and is duly qualified to
transact business and is in good standing in each jurisdiction in which the conduct of its business
or its ownership or leasing of property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a material adverse effect on the
condition (financial or otherwise), earnings, business or properties of the Company and its
subsidiaries, taken as a whole;
(i)
Subsidiary Good Standing
. Each subsidiary of the Company has been duly
incorporated or otherwise organized and is an existing corporation or other entity in good standing
under the laws of the jurisdiction of its incorporation or organization, with power and authority
(corporate and other) to own its properties and conduct its business as described in the Disclosure
Package and the Final Prospectus (or as presently conducted, if not so described therein); and each
subsidiary of the Company is duly qualified to do business as a foreign corporation or other entity
in good standing in all other jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect on the condition
(financial or otherwise), earnings, business or properties of the Company and its subsidiaries,
taken as a whole; all of the issued and outstanding capital stock or other ownership interest of each subsidiary of the Company has been duly authorized and validly
issued and is fully paid and nonassessable; and the capital stock or other ownership interest of
each subsidiary owned by the Company, directly or through
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subsidiaries,
is owned free from liens, encumbrances and defects, other than those arising under the Company’s bank line of credit;
(j)
Authorized Capitalization
. The Company has an authorized capitalization as
described in the Disclosure Package and the Final Prospectus;
(k)
Agreement, Securities and Indenture Authorization
. The Company has full corporate
power and authority to execute, deliver and perform its obligations under this Agreement and this
Agreement has been duly authorized, executed and delivered by the Company; the Securities have been
duly authorized and, when the Securities are issued and delivered pursuant to this Agreement, such
Securities will have been duly executed, authenticated, issued and delivered and, upon payment for
the Securities by the Representatives to the Company, will constitute valid and legally binding
obligations of the Company entitled to the benefits of the Indenture; the Indenture has been duly
authorized and duly qualified under the Trust Indenture Act and, when the Indenture is executed and
delivered, will constitute a valid and legally binding instrument, enforceable against the Company
in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, fraudulent conveyances or transfer, moratorium or similar laws
affecting creditors’ rights generally and subject to general principles of equity (regardless of
whether enforceability is considered in a proceeding in equity or at law); and the Indenture and
the Securities will conform in all material respects to the descriptions thereof contained in the
Disclosure Package and the Final Prospectus with respect to such Securities;
(l)
Material Changes
. Since the respective dates as of which information is given in
the Registration Statement, the Disclosure Package and the Final Prospectus, except as may
otherwise be stated therein or contemplated thereby, there has been no material adverse change,
actual or to the knowledge of the Company, pending, in the condition (financial or otherwise),
earnings, business or properties of the Company and its subsidiaries, taken as a whole, whether or
not arising in the ordinary course of business;
(m)
Financial Statements
. The consolidated historical financial statements of the
Company included or incorporated by reference in the Disclosure Package, the Final Prospectus and
the Registration Statement present fairly in all material respects the financial condition, results
of operations and cash flows of the Company as of the dates and for the periods indicated, comply
as to form with the applicable accounting requirements of the Act and have been prepared in
conformity with U.S. generally accepted accounting principles applied on a consistent basis
throughout the periods involved (except as otherwise noted therein); and, if pro forma financial
statements are included or incorporated by reference in the Disclosure Package, the Final
Prospectus and the Registration Statement, then the assumptions used in preparing the pro forma
financial statements included therein provide a reasonable basis for presenting the significant
effects directly attributable to the transactions or events described therein, the related pro
forma adjustments give appropriate effect to those assumptions, and the pro forma columns therein
reflect the proper application of those adjustments to the corresponding historical financial
statement amounts;
(n)
Officers’ Certificates
. Any certificate signed by any officer of the Company and
delivered to the Representatives or counsel for the Underwriters in
6
connection with the offering of the Securities shall be deemed a representation and warranty by the Company (and not a
representation or warranty by the signing officer in his or her individual capacity), as to matters
covered thereby, to each Underwriter;
(o)
Investment Company Act
. The Company is not and, after giving effect to the
offering and sale of the Securities and the application of the proceeds thereof as described in the
Disclosure Package, will not be an “investment company” as defined in the Investment Company Act of
1940;
(p)
No Unlawful Contributions or Other Payments
. To the knowledge of the Company,
neither the Company nor any of its subsidiaries nor any director, officer, agent, employee or
affiliate of the Company or any of its subsidiaries is aware of or has taken any action, directly
or indirectly, that would result in a violation by the Company or any of its subsidiaries of the
Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder
(“
FCPA
”) and, to the knowledge of the Company, the Company, its subsidiaries and its affiliates
have conducted the businesses of the Company and its subsidiaries in compliance with the FCPA and
have instituted and maintain policies and procedures designed to ensure, and which are reasonably
expected to continue to ensure, continued compliance therewith;
(q)
No Conflict with Money Laundering Laws
. The operations of the Company and its
subsidiaries are and have been conducted at all times in compliance with applicable financial
recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of
1970, as amended, the money laundering statutes of all applicable jurisdictions, the rules and
regulations thereunder and any related or similar rules, regulations or guidelines issued,
administered or enforced by any governmental agency (collectively, the “
Money Laundering Laws
”) and
no action, suit or proceeding by or before any court or governmental agency, authority or body or
any arbitrator involving the Company or any of its subsidiaries with respect to the Money
Laundering Laws is pending or, to the best knowledge of the Company, threatened; and
(r)
No Conflict with OFAC Laws
. Neither the Company nor any of its subsidiaries nor,
to the knowledge of the Company, any director, officer, agent (while acting on behalf of the
Company), employee or affiliate of the Company or any of its subsidiaries is currently subject to
any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury
Department (“
OFAC
”); and the Company will not directly or indirectly use the proceeds of the
offering, or lend, contribute or otherwise make available such proceeds, to any subsidiary, joint
venture partner or other person or entity, for the purpose of financing the activities of any
person currently subject to any U.S. sanctions administered by OFAC.
The Company acknowledges that for purposes of the opinions to be delivered to the Underwriters
pursuant to Section 6 of this Agreement, counsel to the Company and counsel to the Underwriters
will rely upon the accuracy and truth of the foregoing representations, and the Company hereby
consents to such reliance.
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2.
Qualified Independent Underwriter.
(a) The Company hereby confirms its engagement of Credit Suisse Securities (USA) LLC as, and
Credit Suisse Securities (USA) LLC hereby confirms its agreement with the Company to render
services as, a “qualified independent underwriter” within the meaning of Rule 2720(f)(12) of FINRA
with respect to the offering and sale of the Securities.
(b) The QIU hereby represents and warrants to, and agrees with, the Company and the
Underwriters that with respect to the offering and sale of the Securities as described in the
Disclosure Package and the Final Prospectus:
(i) The QIU constitutes a “qualified independent underwriter” within the meaning of
Rule 2720(f)(12);
(ii) The QIU has participated in the preparation of the Disclosure Package and the
Final Prospectus and has exercised the usual standards of “due diligence” in respect
thereto; and
(iii) The QIU has undertaken the legal responsibilities and liabilities of an
underwriter under the Act specifically including those inherent in Section 11 thereof;
(c) The Company agrees to cooperate with the Underwriters and the QIU to enable the
Underwriters to comply with Rule 2720(a) and the QIU to perform the services contemplated by this
Agreement.
(d) The Company agrees promptly to reimburse the QIU for all out of pocket expenses, including
fees and disbursements of counsel, reasonably incurred in connection with this Agreement and the
services to be rendered hereunder.
3.
Purchase and Sale
. Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company agrees to sell to each Underwriter,
and each Underwriter agrees, severally and not jointly, to purchase from the Company, at the
purchase price of 97.642% of the principal amount of the Securities set forth opposite such
Underwriter’s name in
Schedule II
hereto.
4.
Delivery and Payment
. (a) Delivery of and payment for the Securities shall be made
on the date and at the office of Milbank, Tweed, Hadley & McCloy LLP, One Chase Manhattan Plaza,
New York, New York at 10:00 a.m., (Eastern Time) on November 13, 2009, or at such time on such
later date not more than three Business Days after the foregoing date as the Representatives shall
designate, which date and time may be postponed by agreement between the Representatives and the
Company or as provided in Section 10 hereof (such date and time of delivery and payment for the
Securities being herein called the “
Closing Date
”). Delivery of the Securities shall be made to
the Representatives for the respective accounts of the several Underwriters against payment by the
several Underwriters through the Representatives of the purchase price thereof to or upon the order
of the Company by wire transfer payable in same-day funds to an account specified by the Company.
The Securities to be delivered or evidence of their issuance shall be made available for checking
at least 24 hours prior to
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the Closing Date. Delivery of the Securities shall be made through the facilities of The
Depository Trust Company unless the Representatives shall otherwise instruct and agree to with the
Company; and
(b) As compensation for the services rendered by the Underwriters to the Company in respect of
the issuance and sale of the Securities, the Company on the Closing Date will pay to the
Representatives for the respective accounts of the several Underwriters a commission of 1.50% of
the principal amount of Securities sold to the Underwriters under this Agreement. Payment to the
Representatives shall be made by wire transfer payable in same-day funds to an account specified by
the Representatives. All payments to be made by the Company to the Representatives as compensation
for the services rendered by the Underwriters to the Company in respect of the issuance and sale of
the Securities hereunder shall be made without withholding or deduction for or on account of any
present or future taxes, duties or governmental charges whatsoever, provided that each Underwriter
deals at arm’s length with the Company and (i) any such commission or fee is payable in respect of
services rendered by an Underwriter that are performed in the ordinary course of business carried
on by the Underwriter, which includes the performance of such services for a fee, and (ii) any such
amount is reasonable under the circumstances.
5.
Agreements
. The Company agrees with the Representatives and the several
Underwriters that:
(a) Prior to the termination of the offering of the Securities, the Company will not file any
amendment or supplement to the Registration Statement or the Basic Prospectus (including the Final
Prospectus or any Preliminary Final Prospectus) unless the Company has furnished a copy to the
Representatives for their review prior to filing and will not file any such proposed amendment or
supplement to which the Representatives reasonably object unless filing is immediately required by
law without right of appeal. Subject to the foregoing sentence, the Company will prepare the Final
Prospectus setting forth the principal amount of Securities covered thereby, the terms not
otherwise specified in the Basic Prospectus pursuant to which the Securities are being issued, the
names of the Underwriters participating in the offering and the principal amount of Securities
which each severally has agreed to purchase, the names of the Underwriters acting as co-managers in
connection with the offering, the price at which the Securities are to be purchased by the
Underwriters from the Company, the initial public offering price, and the selling concession and
reallowance, if any, in a form approved by the Representatives and shall file such Final Prospectus
with the Commission not later than the Commission’s close of business on the second business day
following the Execution Time. The Company will promptly file all reports required to be filed by
it with the Commission pursuant to Section 13(a), 13(c) or 15(d) of the Exchange Act for so long as
the delivery of a prospectus is required (including in circumstances where such requirement may be
satisfied pursuant to Rule 172 of the Act) in connection with the offering or sale of the
Securities, and during such same period will advise the Representatives, promptly after it receives
notice thereof, of the time when any amendment to the Registration Statement has been filed or
becomes effective (other than filings of the Company’s annual report pursuant to Section 13(a) or
15(d) of the Exchange Act) or any supplement to the Basic Prospectus or any amended Final
Prospectus has been filed with the Commission, of the issuance by the Commission of
9
any stop
order or of any order preventing or suspending the use of any prospectus relating to the Securities, of
the suspension of the qualification of such Securities for offering or sale in any jurisdiction, of
the initiation or threatening, to the knowledge of the Company, of any proceeding for any such
purpose, or of any request by the Commission for the amending or supplementing of the Registration
Statement, the Final Prospectus or for additional information relating to the Securities; and the
Company will use its commercially reasonable best efforts to prevent the issuance of any such stop
order or any such order preventing or suspending the use of any prospectus relating to the
Securities or the suspension of any such qualification and, in the event of the issuance of any
such stop order or of any such order preventing or suspending the use of any prospectus relating to
the Securities or suspending any such qualification, to use its commercially reasonable best
efforts to obtain the withdrawal of such order as soon as possible;
(b) Notwithstanding the provisions of paragraph (a) above, if, at any time when a prospectus
relating to the Securities is required to be delivered under the Act (including in circumstances
where such requirement may be satisfied pursuant to Rule 172), any event occurs as a result of
which the Final Prospectus, as then amended or supplemented, would include any untrue statement of
a material fact or omit to state any material fact necessary to make the statements therein in the
light of the circumstances under which they were made not misleading, or if it shall be necessary
to amend the Registration Statement or supplement the Final Prospectus to comply with the Act or
the Exchange Act, or the respective rules thereunder, the Company will promptly (i) notify the
Representatives of such event, (ii) prepare and file with the Commission an amendment or supplement
which will correct such statement or omission or effect such compliance and (iii) supply any
supplemented Final Prospectus to the Representatives in such quantities as it may reasonably
request;
(c) As soon as practicable, the Company will make generally available to its security holders
an earnings statement or statements of the Company and its subsidiaries which will satisfy the
provisions of Section 11(a) of the Act and Rule 158 under the Act;
(d) The Company will furnish to the Representatives and counsel for the Underwriters, without
charge, copies of the Registration Statement (including exhibits thereto) and to the
Representatives for delivery to each other Underwriter a copy of the Registration Statement
(without exhibits thereto) and, so long as delivery of a prospectus by an Underwriter or dealer may
be required by the Act (including in circumstances where such requirement may be satisfied pursuant
to Rule 172), as many copies of each Preliminary Final Prospectus, Issuer Free Writing Prospectus
and Final Prospectus and any supplement thereto as the Representatives may reasonably request. The
Company will pay the expenses of printing or other production of all documents relating to the
offering;
(e) The Company will arrange, if necessary, for the qualification of the Securities for sale
under the laws of such jurisdictions in the United States of America as the Representatives may
designate upon consultation with the Company and will maintain such qualifications in effect so
long as required for the distribution of the Securities and will pay any fee of FINRA, in
connection with its review of the offering; provided that in no event shall the Company be
obligated to qualify to do business in any
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jurisdiction where it is not now so qualified or to take any action that would subject it to service of process in suits, other than those arising out of the offering or sale of the
Securities, in any jurisdiction where it is not now so subject;
(f) The Company agrees that, unless it obtains the prior written consent of the
Representatives, and each Underwriter, severally and not jointly, agrees with the Company that,
unless it has obtained or will obtain, as the case may be, the prior written consent of the Company
and the Representatives, it has not made and will not make any offer relating to the Securities
that would constitute an Issuer Free Writing Prospectus or that would otherwise constitute a “free
writing prospectus” (as defined in Rule 405 under the Act) required to be filed by the Company with
the Commission or retained by the Company under Rule 433 under the Act (other than (i) one or more
term sheets relating to the Securities containing customary information and conveyed to purchasers
of Securities and (ii) the electronic road show relating to the Securities); provided that the
prior written consent of the parties hereto shall be deemed to have been given in respect of the
Free Writing Prospectuses included in
Schedule I
hereto. Any such free writing prospectus
consented to by the Representatives or the Company is hereinafter referred to as a “
Permitted Free
Writing Prospectus
.” The Company agrees that (x) it has treated and will treat, as the case may
be, each Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus and (y) it has
complied and will comply, as the case may be, with the requirements of Rules 164 and 433 under the
Act applicable to any Permitted Free Writing Prospectus, including in respect of timely filing with
the Commission, legending and record keeping;
(g) The Company will not, without the prior written consent of the Representatives, offer,
sell, contract to sell, pledge, or otherwise dispose of (or enter into any transaction which is
designed to, or might reasonably be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash settlement or otherwise) by the Company
or any affiliate of the Company or any person in privity with the Company or any affiliate of the
Company) directly or indirectly, including the filing (or participation in the filing) of a
registration statement with the Commission in respect of, or establish or increase a put equivalent
position or liquidate or decrease a call equivalent position within the meaning of Section 16 of
the Exchange Act, any debt securities with a term in excess of nine months issued or guaranteed by
the Company (other than the Securities) or publicly announce an intention to effect any such
transaction within the U.S. marketplace until the earlier of the Business Day which is (A) 5 days
from the date of this Agreement, provided that (i) the Representatives receive written notification
in advance of any new offering of debt securities issued or guaranteed by the Company and (ii) the
Underwriters’ selling efforts with respect to the debt securities offering pursuant to this
Agreement have concluded and trading in such debt securities is continuing; or (B) 30 days from the
date of this Agreement;
(h) The Company will use the net proceeds received by it from the sale of any Securities in
the manner specified in the Final Prospectus and the Disclosure Package under the caption “Use of
Proceeds”;
(i) In connection with each offering of Securities, the Company will take such steps as it
deems necessary to ascertain promptly whether each Preliminary Final Prospectus that supplements
the Basic Prospectus and the Final Prospectus prepared in connection with such offering and
transmitted for filing, in each case, was received for
11
filing by the Commission, and, in the event that any such prospectuses were not received for
filing, it will promptly file any such prospectus not then received for filing;
(j) The Company agrees to pay the costs and expenses relating to the following matters: (i)
the preparation, printing or reproduction and filing with the Commission of the Registration
Statement (including financial statements and exhibits thereto), any Issuer Free Writing
Prospectus, each Preliminary Final Prospectus and Final Prospectus, and each amendment or
supplement to any of them; (ii) the printing (or reproduction) and delivery (including postage, air
freight charges and charges for counting and packaging) of such copies of the Registration
Statement, each Preliminary Final Prospectus, each Issuer Free Writing Prospectus and Final
Prospectus, and all amendments or supplements to any of them, as may, in each case, be reasonably
requested for use in connection with the offering and sale of the Securities; (iii) the
preparation, printing, authentication, issuance and delivery of certificates for the Securities,
including any stamp or transfer taxes in connection with the original issuance and sale of the
Securities; (iv) the printing (or reproduction) and delivery of this Agreement and all other
agreements or documents printed (or reproduced) and delivered in connection with the offering of
the Securities; (v) the transportation and other expenses of the Company’s officers and employees
in connection with presentations to prospective purchasers of the Securities; (vi) the fees and
expenses of the Company’s accountants and the fees and expenses of counsel for the Company; (vii)
any fees and expenses of the Trustee and any agent of the Trustee and the fees and disbursements of
counsel for the Trustee in connection with the Indenture and the Securities; (viii) any fees
charged by securities rating services for rating the Securities; (ix) all costs and expenses of
Credit Suisse Securities (USA) LLC, including the reasonable fees and disbursements of its counsel,
incurred in its capacity as “qualified independent underwriter” within the meaning of FINRA Conduct
Rule 2720 in connection with the offering of the Securities; (x) any costs, expenses and filing
fees incurred in connection with the qualification of the Securities for sale under the laws of
such jurisdictions as the Representatives designate (including the reasonable fees and
disbursements of counsel relating to such qualification) and the preparation and printing of
memoranda relating thereto, costs and expenses related to the review by FINRA of the offering
(including filing fees and the fees and expenses of counsel and any special counsel for the
Underwriters relating to such review); and (xi) all other costs and expenses of the Company and its
representatives incident to the performance by the Company of its obligations hereunder;
(k) The Company will not take, directly or indirectly, any action designed to or that would
constitute or that might reasonably be expected to cause or result in, under the Exchange Act or
otherwise, stabilization or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities; and
(l) The Company will prepare a final term sheet relating to the Securities, containing only
information that describes the final terms of the Securities and otherwise in a form consented to
by the Representatives, and will file such final term sheet within the period required by Rule
433(d)(5)(ii) on or following the date such final terms have been established for all classes of
the offering of the Securities. Any such final term sheet is an Issuer Free Writing Prospectus and
a Permitted Free Writing Prospectus for purposes of this Agreement. The Company also consents to
the use by any Underwriter of a Free Writing Prospectus that contains only (i)(x) information
describing
12
the preliminary terms of the Securities or their offering or (y) information that describes
the final terms of the Securities or their offering and that is included in the final term sheet of
the Company contemplated in the first sentence of this subsection or (ii) other information that is
not “issuer information,” as defined in Rule 433, it being understood that any such Free Writing
Prospectus referred to in clause (i) or (ii) above shall not be an Issuer Free Writing Prospectus
for purposes of this Agreement.
6.
Conditions to the Obligations of the Underwriters
. The obligations of the
Underwriters to purchase the Securities shall be subject to the accuracy of the representations and
warranties on the part of the Company contained herein as of the Initial Sale Time and the Closing
Date, to the accuracy of the statements of the Company made in any certificates pursuant to the
provisions of this Section, to the performance by the Company of its obligations hereunder, and to
the following additional conditions:
(a) Each Preliminary Final Prospectus that supplements the Basic Prospectus and the Final
Prospectus shall have been filed with the Commission, in each case, within the applicable time
period prescribed for such filing and in accordance with Section 5(a) hereof; no stop order
suspending the effectiveness of the Registration Statement or any part thereof shall have been
issued and no order preventing or suspending the use of any prospectus relating to the Securities
shall have been issued and no proceeding for any such purpose shall have been initiated or
threatened by the Commission;
(b) The Representatives shall have received from Vinson & Elkins LLP, counsel for the Company,
their opinion, dated the Closing Date and addressed to the Representatives, to the effect set forth
in
Annex I
hereto;
(c) The Representatives shall have received from the General Counsel to the Company, his
opinion, dated the Closing Date and addressed to the Representatives, to the effect set forth in
Annex II
hereto;
(d) The Representatives shall have received from Milbank, Tweed, Hadley & McCloy LLP, counsel
for the Underwriters, such opinion or opinions, dated the Closing Date and addressed to the
Representatives, with respect to the issuance and sale of the Securities, the Indenture, the
Registration Statement, the Disclosure Package, the Final Prospectus (together with any supplement
thereto) and other related matters as the Representatives may reasonably require, and the Company
shall have furnished to such counsel such documents as they reasonably require and request for the
purpose of enabling them to pass upon such matters;
(e) The Company shall have furnished to the Representatives a certificate of the Company,
signed in their representative capacities by the Chief Executive Officer and Chief Financial
Officer of the Company, dated the Closing Date, to the effect that:
(i) the representations and warranties of the Company in this Agreement are true and
correct in all material respects on and as of the Closing Date with the same effect as if
made on the Closing Date and the Company has complied with all the agreements and satisfied
all the conditions on its part to be performed or satisfied at or prior to the Closing
Date;
13
(ii) no stop order suspending the effectiveness of the Registration Statement or stop
order preventing or suspending the use of any prospectus relating to the Securities has
been issued and no proceedings for that purpose have been, to the Company’s knowledge,
instituted or threatened by the Commission; and
(iii) since the date of the most recent financial statements included or incorporated
by reference in the Final Prospectus, as amended or supplemented prior to the Execution
Time, there has been no material adverse effect on the condition (financial or otherwise),
earnings, business or properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Final Prospectus, as amended or supplemented prior to the
Execution Time, or as described in such certificate;
(f) At the Execution Time and the Closing Date, the Representatives shall have received from
Ernst & Young LLP a letter or letters dated such date or dates, in form and substance reasonably
satisfactory to the Representatives, together with signed or reproduced copies of such letter or
letters for each of the other Underwriters containing statements and information of the type
ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial
statements and certain financial information contained in the Registration Statement, the Final
Prospectus, the Disclosure Package and any Issuer Free Writing Prospectus;
(g) Subsequent to the Execution Time or, if earlier, the dates as of which information is
given in the Registration Statement as amended or supplemented prior to the Execution Time, the
Final Prospectus as amended or supplemented prior to the Execution Time or any Issuer Free Writing
Prospectus, there shall not have been (i) any change or decrease specified in the letter or letters
referred to in paragraph (f) of this Section 6 or (ii) any change, or any development involving a
prospective change, in or affecting the condition (financial or otherwise), earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in or contemplated in the
Final Prospectus, as amended or supplemented prior to the Execution Time, the effect of which, in
any case referred to in clause (i) or (ii) above, is, in the sole judgment of the Representatives,
so material and adverse as to make it impractical or inadvisable to proceed with the offering or
delivery of the Securities as contemplated by the Registration Statement, the Final Prospectus and
any Issuer Free Writing Prospectus;
(h) Subsequent to the Execution Time, there shall not have been any decrease in the rating of
any of the Company’s debt securities by any “nationally recognized statistical rating organization”
(as defined for purposes of Rule 436(g) under the Act) or any notice given of any intended or
potential decrease in any such rating or of a possible change in any such rating that does not
indicate the direction of the possible change; and
(i) Prior to the Closing Date, the Company shall have furnished to the Representatives such
further information, certificates and documents as the Representatives may reasonably request.
14
If any of the conditions specified in this Section 6 shall not have been fulfilled in all
material respects when and as provided in this Agreement, or if any of the opinions and
certificates mentioned above or elsewhere in this Agreement shall not be in all material respects
reasonably satisfactory in form and substance to the Representatives, this Agreement and all
obligations of the Underwriters hereunder may be canceled at, or at any time prior to, the Closing
Date by the Representatives. Notice of such cancellation shall be given to the Company in writing
or by telephone or facsimile confirmed in writing. The Representatives may in their sole discretion
waive on behalf of the Underwriters compliance with any conditions to the obligations of the
Underwriters hereunder.
The documents required to be delivered by this Section 6 shall be delivered to the offices of
Milbank, Tweed, Hadley & McCloy LLP at One Chase Manhattan Plaza, New York, New York 10005 on the
Closing Date or such other place as the Representatives shall so instruct.
7.
Reimbursement of Underwriters’ Expenses
. If the sale of the Securities provided
for herein is not consummated because any condition to the obligations of the Underwriters set
forth in Section 6 hereof is not satisfied, or because of any refusal, inability or failure on the
part of the Company to perform any agreement herein or comply with any provision hereof other than
by reason of a default by any of the Underwriters, the Company will reimburse the Underwriters
severally through the Representatives on demand for all reasonable out-of-pocket expenses
(including reasonable fees and disbursements of counsel) that shall have been incurred by them in
connection with the proposed purchase and sale of the Securities.
8.
QIU Consent
. The QIU hereby consents to the references to it as set forth under
the caption “Underwriting” in the Disclosure Package and the Final Prospectus and in any amendment
or supplement thereto made in accordance with Section 5(a) hereof.
9.
Indemnification and Contribution
. (a) The Company agrees to indemnify and hold
harmless each Underwriter, the directors, officers, employees and agents of each Underwriter and
each person, if any, who controls any Underwriter within the meaning of the Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any of them may become
subject under the Act, the Exchange Act or other federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of
a material fact contained in the Registration Statement as originally filed, the Basic Prospectus,
any Preliminary Final Prospectus, the Final Prospectus or any Issuer Free Writing Prospectus, or in
all cases any amendment thereof or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and agrees to reimburse each such
indemnified party, as incurred, for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such untrue statement or
alleged untrue statement or omission or alleged omission made therein in reliance upon and in
conformity with written
15
information furnished to the Company by or on behalf of any Underwriter through the
Representatives specifically for inclusion therein. This indemnity agreement will be in addition to
any liability which the Company may otherwise have to any Underwriter or to any officer, employee
or controlling person of that Underwriter;
(a) (i) The Company will indemnify and hold harmless Credit Suisse Securities (USA) LLC, in
its capacity as QIU, against any losses, claims, damages or liabilities, joint or several, to which
the QIU may become subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any act or omission to
act or any alleged act or omission to act by Credit Suisse Securities (USA) LLC, as QIU, in
connection with any transaction contemplated by this Agreement or undertaken in preparing for the
purchase, sale and delivery of the Securities, except to the extent that any such loss, claim,
damage or liability results from the gross negligence or bad faith of Credit Suisse Securities
(USA) LLC in performing the services as QIU, and will reimburse the QIU for any legal or other
expenses reasonably incurred by the QIU in connection with investigating or defending any such
action or claim as such expenses are incurred.
(ii) The obligations of the Company under this Section 9(b) shall be in addition to
any liability which the Company may otherwise have and shall extend, upon the same terms
and conditions, to each person, if any, who controls the QIU within the meaning of the Act;
(b) Each Underwriter severally and not jointly agrees to indemnify and hold harmless the
Company, each of its directors, its officers, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, to the same extent as the foregoing indemnity from
the Company to each Underwriter, but only with reference to written information relating to such
Underwriter furnished to the Company by or on behalf of such Underwriter through the
Representatives specifically for inclusion in the documents referred to in the foregoing indemnity.
This indemnity agreement will be in addition to any liability which any Underwriter may otherwise
have. The Company acknowledges that the statements set forth (x) in the last paragraph of the
cover page regarding delivery of the Securities and (y) under the heading “Underwriting”, (i) the
names listed in the table included in the first paragraph of the text, (ii) the third paragraph of
text concerning concessions, (iii) the sixth paragraph of text concerning confirmation of sales to
any account over which the Underwriters exercise discretionary authority, (iv) the third sentence
in the seventh paragraph of text concerning market making by the Underwriters and (v) the eighth
and ninth paragraphs of text concerning stabilizing transactions and penalty bids, in any
Preliminary Final Prospectus and Final Prospectus constitute the only information furnished in
writing by or on behalf of the several Underwriters for inclusion in any Preliminary Final
Prospectus, the Registration Statement, the Disclosure Package or the Final Prospectus;
(c) Promptly after receipt by an indemnified party under this Section 9 of notice of the
commencement of any action, such indemnified party will, if a claim in respect thereof is to be
made against the indemnifying party under this Section 9, notify the indemnifying party in writing
of the commencement thereof; but the failure so to notify the indemnifying party (i) will not
relieve it from liability under paragraph (a), (b) or (c) above unless and to the extent the
indemnifying party did not otherwise learn of such action and such failure results in the
forfeiture by the indemnifying party of
16
substantial rights and defenses and (ii) will not, in any event, relieve the indemnifying
party from any obligations to any indemnified party other than the indemnification obligation
provided in paragraph (a), (b) or (c) above. The indemnifying party shall be entitled to assume
the defense thereof and to appoint counsel of the indemnifying party’s choice at the indemnifying
party’s expense to represent the indemnified party in any action for which indemnification is
sought (in which case the indemnifying party shall not thereafter be responsible for the fees and
expenses of any separate counsel retained by the indemnified party or parties except as set forth
below); provided, however, that such counsel shall be reasonably satisfactory to the indemnified
party. Notwithstanding the indemnifying party’s election to appoint counsel to represent the
indemnified party in an action, the indemnified party shall have the right to employ separate
counsel, and the indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel (including local counsel) if (i) the use of counsel chosen by the indemnifying
party to represent the indemnified party would present such counsel with a conflict of interest,
(ii) the actual or potential defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it and/or other indemnified parties which
are different from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified party
to represent the indemnified party within a reasonable time after notice of the institution of such
action or (iv) the indemnifying party shall authorize the indemnified party to employ separate
counsel at the expense of the indemnifying party. An indemnifying party will not, without the
prior written consent of the indemnified parties, settle or compromise or consent to the entry of
any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect
of which indemnification or contribution may be sought hereunder (whether or not the indemnified
parties are actual or potential parties to such claim or action) unless such settlement, compromise
or consent (x) includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding and (y) does not include a statement as to or
an admission of fault, culpability or a failure to act, by or on behalf of an indemnified party;
and
(d) In the event that the indemnity provided in paragraph (a), (b) or (c) of this Section 9 is
unavailable to or insufficient to hold harmless an indemnified party for any reason, the Company,
the QIU and the Underwriters severally agree to contribute to the aggregate losses, claims, damages
and liabilities (including legal or other expenses reasonably incurred in connection with
investigating or defending same) (collectively “
Losses
”) to which the Company and one or more of
the Underwriters or the QIU may be subject in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and by the Underwriters or the QIU on the
other from the offering of the Securities; provided, however, that in no case shall any Underwriter
or the QIU (except as may be provided in any agreement among underwriters relating to the offering
of the Securities) be responsible for any amount in excess of the total price at which the
Securities underwritten and distributed to the public by such Underwriter or QIU was offered to the
public. If the allocation provided by the immediately preceding sentence is unavailable for any
reason, the Company, the QIU and the Underwriters severally shall contribute in such proportion as
is appropriate to reflect not only such relative benefits but also the relative fault of the
Company on the one hand and of the Underwriters or the QIU on the other in connection with the
statements or omissions
17
which resulted in such Losses as well as any other relevant equitable considerations.
Benefits received by the Company shall be deemed to be equal to the total net proceeds from the
offering (before deducting expenses) received by it, and benefits received by the Underwriters or
the QIU shall be deemed to be equal to the total underwriting discounts and commissions received by
the Underwriters with respect to the Securities purchased under this Agreement, or the fee payable
to the QIU in Section 2 hereof. Relative fault shall be determined by reference to, among other
things, whether any untrue or any alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information provided by the Company on the one
hand or the Underwriters or the QIU on the other, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such untrue statement or
omission. The Company, the QIU and the Underwriters agree that it would not be just and equitable
if contribution were determined by pro rata allocation or any other method of allocation which does
not take account of the equitable considerations referred to above. Notwithstanding the provisions
of this paragraph (e), no person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section 9, each person who controls an
Underwriter or the QIU within the meaning of the Act and each director, officer, employee and agent
of an Underwriter or the QIU shall have the same rights to contribution as such Underwriter or the
QIU, and each person who controls the Company within the meaning of the Act, each officer of the
Company and each director of the Company shall have the same rights to contribution as the Company,
subject in each case to the applicable terms and conditions of this paragraph (e).
10.
Default by an Underwriter
. If any one or more Underwriters shall fail to purchase
and pay for any of the Securities agreed to be purchased by such Underwriter or Underwriters
hereunder and the aggregate principal amount of Securities that such defaulting Underwriter or
Underwriters agreed but failed to purchase does not exceed 10% of the total principal amount of
Securities that the Underwriters are obligated to purchase and such failure to purchase shall
constitute a default in the performance of its or their obligations under this Agreement, then the
Representatives shall have the right, within 24 hours thereafter, to make arrangements for one or
more of the non-defaulting Underwriters, or any other underwriters, to purchase all, but not less
than all of the unsold Securities in such amounts as may be agreed upon and upon the terms herein
set forth; if, however, the Representatives shall not have completed such arrangements within such
24-hour period, then the non-defaulting Underwriters shall be obligated severally to take up and
pay for (in the respective proportions which the principal amount of Securities set forth opposite
their names in
Schedule II
hereto bears to the aggregate principal amount of Securities set
forth opposite the names of all the non-defaulting Underwriters) the Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase. If any Underwriter or
Underwriters so default and the aggregate principal amount of Securities with respect to which such
default or defaults occur exceeds 10% of the total principal amount of Securities that the
defaulting Underwriter is obligated to purchase on such Closing Date and arrangements satisfactory
to the Representatives and the Company for the purchase of such Securities by other persons are not
made within 36 hours after such default, this Agreement will terminate without liability on the
part of any non-defaulting Underwriter or the Company, except as provided in Section 12. As used in
this Agreement, the term “Underwriter” includes any
18
person substituted for an Underwriter under this Section. Nothing contained in this Agreement
shall relieve any defaulting Underwriter of its liability, if any, to the Company and any
non-defaulting Underwriter for damages occasioned by its default hereunder.
11.
Termination
. This Agreement shall be subject to termination in the absolute
discretion of the Representatives, by notice given to the Company prior to delivery of and payment
for the Securities, if at any time prior to such time, (i) trading in securities generally on the
New York Stock Exchange or the Nasdaq National Market shall have been suspended or limited or
minimum prices shall have been established on any of such Exchanges, (ii) a banking moratorium
shall have been declared either by authorities in the United States or New York state, (iii) there
shall have occurred a change or development involving a prospective change in United States
taxation affecting the Securities or the transfer thereof or the imposition of exchange controls by
the United States, or (iv) there shall have occurred any outbreak or escalation of hostilities,
except as existing with similar severity on the date hereof involving the United States,
declaration by the United States of a national emergency or war, or other calamity or crisis,
except as existing with similar severity on the date hereof the effect of which on financial
markets is such as to make it, in the sole judgment of the Representatives, impractical or
inadvisable to proceed with the offering or delivery of the Securities as contemplated by the
Disclosure Package and the Final Prospectus.
12.
Representations and Indemnities to Survive
. The respective agreements,
representations, warranties, indemnities and other statements of the Company or its officers and of
the Underwriters set forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation made by or on behalf of any Underwriter or the Company or
any of the officers, directors, employees, agents or controlling persons referred to in Section 9
hereof, and will survive delivery of and payment for the Securities. The provisions of Sections 7
and 9 hereof shall survive the termination or cancellation of this Agreement.
13.
Notices
. All communications hereunder will be in writing and effective only on
receipt, and, if sent to the Representatives, will be mailed, delivered or telefaxed to Deutsche
Bank Securities Inc., office of the Legal Department (fax no.: (212) 797-4564) and confirmed to
Senior Counsel, Deutsche Bank Securities Inc. at 60 Wall Street, Floor 36, New York, New York,
10005; if sent to the QIU, will be mailed or delivered to Credit Suisse Securities (USA) LLC,
Eleven Madison Avenue, New York, New York 10010; or, if sent to the Company, will be mailed,
delivered or telefaxed to Pioneer Natural Resources Company (fax no.: (972) 969-3552) and confirmed
to it at 5205 N. O’Connor Boulevard, Suite 200, Irving, Texas 75039, Attention: General Counsel.
14.
Successors
. This Agreement will inure to the benefit of and be binding upon the
parties hereto and their respective successors and the officers, directors, employees, agents and
controlling persons referred to in Section 9 hereof, and no other person will have any right or
obligation hereunder.
15.
Representation of Underwriters
. The Representatives will act for the several
Underwriters in connection with this Agreement, and any action under this Agreement taken by the
Representatives will be binding upon all the Underwriters.
19
16.
No Advisory or Fiduciary Responsibility
. The Company acknowledges and agrees that
(i) the purchase and sale of the Securities pursuant to this Agreement is an arm’s-length
commercial transaction between the Company, on the one hand, and the Underwriters, on the other,
(ii) in connection therewith and with the process leading to such transaction each Underwriter is
acting solely as a principal and not the agent or fiduciary of the Company, (iii) no Underwriter
has assumed an advisory or fiduciary responsibility in favor of the Company with respect to the
offering contemplated hereby or the process leading thereto (irrespective of whether such
Underwriter has advised or is currently advising the Company on other matters) or any other
obligation to the Company except the obligations expressly set forth in this Agreement and (iv) the
Company has consulted its own legal and financial advisors to the extent it deemed appropriate.
The Company has been advised that the Representatives and their affiliates are engaged in a broad
range of transactions which may involve interests that differ from those of the Company and that
the Representatives have no obligation to disclose such interests and transactions to the Company
by virtue of any fiduciary, advisory or agency relationship. The Company agrees that it will not
claim that any Underwriter has rendered advisory services of any nature or respect, or owes a
fiduciary or similar duty to the Company, in connection with such transaction or the process
leading thereto. The Company waives, to the fullest extent permitted by law, any claims it may
have against the Representatives for breach of fiduciary duty or alleged breach of fiduciary duty
and agrees that the Representatives shall have no liability (whether direct or indirect) to the
Company in respect of such a fiduciary duty claim or to any person asserting a fiduciary duty claim
on behalf of or in right of the Company, including stockholders, employees or creditors of the
Company.
17.
APPLICABLE LAW
. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED WITHIN THE
STATE OF NEW YORK WITHOUT REGARD TO ANY APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS.
18.
Counterparts
. This Agreement may be signed in one or more counterparts, each of
which shall constitute an original and all of which together shall constitute one and the same
agreement.
19.
Headings
. The section headings used herein are for convenience only and shall not
affect the construction hereof.
20.
Definitions
. The terms which follow, when used in this Agreement, shall have the
meanings indicated.
“
430B Information
” means information included in a prospectus then deemed to be a part
of the Registration Statement pursuant to Rule 430B(e) or retroactively deemed to be a part
of the Registration Statement pursuant to Rule 430B(f).
“
430C Information
” means information included in a prospectus then deemed to be a part
of the Registration Statement pursuant to Rule 430C.
“
Act
” shall mean the Securities Act of 1933 and the rules and regulations
20
of the Commission promulgated thereunder.
“
Basic Prospectus
” shall mean the final short form shelf prospectus as most recently
amended, if applicable, filed with the Commission, in accordance with the Act.
“
Business Day
” shall mean any day other than a Saturday, a Sunday or a day on which
banking institutions are authorized or obligated by law or regulation to close in New York
City.
“
Commission
” shall mean the Securities and Exchange Commission.
“
Disclosure Package
” shall mean (i) the Basic Prospectus, together with each
Preliminary Final Prospectus that supplements the Basic Prospectus, as amended and
supplemented to the Execution Time (which is the most recent Statutory Prospectus
distributed to investors generally) and (ii) the General Use Issuer Free Writing
Prospectuses, if any, identified in
Schedule I
hereto issued at or prior to the
Initial Sale Time.
“
Effective Date
” shall mean each date and time that any part of the Registration
Statement, any post-effective amendment or amendments thereto became or becomes effective.
“
Environmental Laws
” shall mean any United States and other applicable foreign,
federal, provincial, state, local or municipal laws and regulations relating to the
protection of human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants.
“
Exchange Act
” shall mean the Securities Exchange Act of 1934 and the rules and
regulations of the Commission promulgated thereunder.
“
Execution Time
” shall mean the date and time that this Agreement is executed and
delivered by the parties hereto.
“
Final Prospectus
” means the Statutory Prospectus that discloses the public offering
price, other 430B Information and other final terms of the Securities and otherwise
satisfies Section 10(a) of the Act.
“
Free Writing Prospectus
” shall mean a free writing prospectus, as defined in Rule 405
under the Act.
“
General Use Issuer Free Writing Prospectus
” shall mean any Issuer Free Writing
Prospectus that is intended for general distribution to prospective investors, as evidenced
by its being so specified in
Schedule I
to this Agreement.
“
Governmental Authority
” shall mean any court or governmental agency or body or any
arbitrator of any kind having jurisdiction over the Company or any of its subsidiaries or
any of their properties.
“
Governmental Authorization
” shall mean any consent, approval, authorization, order,
permit, license, filing, registration, clearance or qualification
21
of, or with any statute, order, rule or regulation of any Governmental Authority.
“
Initial Sale Time
” shall mean 3:30 pm (Eastern time) on November 9, 2009, which is
the time of the first contract of sale for the Securities.
“
Issuer Free Writing Prospectus
” shall mean any “issuer free writing prospectus,” as
defined in Rule 433, relating to the Securities in the form filed or required to
be filed with the Commission or, if not required to be filed, in the form retained in the
Company’s records pursuant to Rule 433(g).
“
Limited Use Issuer Free Writing Prospectus
” means any Issuer Free Writing Prospectus
that is not a General Use Issuer Free Writing Prospectus, as evidenced by it being so
specified in
Schedule I
of this Agreement.
“
Preliminary Final Prospectus
” shall mean any preliminary prospectus supplement to the
Basic Prospectus that describes the Securities and the offering thereof and is used by the
Underwriters prior to filing of the Final Prospectus, together with the Basic Prospectus.
“
Renewal Deadline
” shall mean the third anniversary of the initial effective time of
the Registration Statement.
“
Rules and Regulations
” shall mean the rules and regulations of the Commission.
“
Statutory Prospectus
” with reference to any particular time shall mean the prospectus
relating to the Securities that is included in the Registration Statement immediately prior
to that time, including all 430B Information and all 430C Information with respect to the
Registration Statement. For purposes of the foregoing definition, 430B Information shall
be considered to be included in the Statutory Prospectus only as of the actual time that
form of prospectus (including a prospectus supplement) is filed with the Commission
pursuant to Rule 424(b) and not retroactively.
“
Trust Indenture Act
” shall mean the Trust Indenture Act of 1939, as amended, and the
rules and regulations of the Commission promulgated thereunder.
Unless otherwise specified, a reference to a “rule” is to the indicated rule under the Act.
[Remainder of the page intentionally left blank]
22
If the foregoing is in accordance with your understanding of our agreement, please sign and return
to us the enclosed duplicate hereof, whereupon this letter and your acceptance shall represent a
binding agreement among the Company, the QIU and the several Underwriters.
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Very truly yours,
PIONEER NATURAL RESOURCES COMPANY
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By:
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/s/ Richard P. Dealy
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Name:
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Richard P. Dealy
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Title:
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Executive Vice President and
Chief Financial Officer
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The foregoing Agreement is hereby confirmed and accepted as of the date first above written.
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DEUTSCHE BANK SECURITIES INC.
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J.P. MORGAN SECURITIES INC.
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WELLS FARGO SECURITIES, LLC
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RBS SECURITIES INC.
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UBS SECURITIES LLC
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BANC OF AMERICA SECURITIES LLC
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BMO CAPITAL MARKETS CORP.
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CITIGROUP GLOBAL MARKETS INC.
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CREDIT SUISSE SECURITIES (USA) LLC
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GOLDMAN, SACHS & CO.
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MORGAN STANLEY & CO. INCORPORATED
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BY: DEUTSCHE BANK SECURITIES INC.
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By:
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/s/ Ben Smilchensky
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Name:
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Ben Smilchensky
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Title:
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Managing Director
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By:
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/s/ Richard Dalton
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Name:
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Richard Dalton
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Title:
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Director
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BY: J.P. MORGAN SECURITIES INC.
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By:
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/s/ Robert Mertensotto
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Name:
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Robert Mertensotto
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Title:
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Managing Director
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BY: WELLS FARGO SECURITIES, LLC
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By:
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/s/ Todd Schanzlin
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Name:
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Todd Schanzlin
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Title:
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Director
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For themselves and as the Representatives of the
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other several Underwriters.
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CREDIT SUISSE SECURITIES (USA) LLC
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By:
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/s/ David Alterman
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Name:
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David Alterman
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Title:
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Director
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As qualified independent underwriter.
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SCHEDULE I
1. General Use Issuer Free Writing Prospectuses (included in the Disclosure Package)
“General Use Issuer Free Writing Prospectus” includes the following document:
Final term sheet, dated November 9, 2009, a copy of which is attached hereto as
Schedule III
.
2. Other Information Included in the Disclosure Package
The following information is also included in the Disclosure Package:
[None]
3. Limited Use Issuer Free Writing Prospectus.
“Limited Use Issuer Free Writing Prospectus” includes the following:
The electronic roadshow available at www.netroadshow.com
SCHEDULE II
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Principal Amount
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Underwriters
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of Securities to be Purchased
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Deutsche Bank Securities Inc.
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US$
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90,000,000
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J.P. Morgan Securities Inc.
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$
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90,000,000
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Wells Fargo Securities, LLC
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$
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90,000,000
|
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RBS Securities Inc.
|
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$
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45,000,000
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UBS Securities LLC
|
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$
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45,000,000
|
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Banc of America Securities LLC
|
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$
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16,875,000
|
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BMO Capital Markets Corp.
|
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$
|
16,875,000
|
|
Citigroup Global Markets Inc.
|
|
$
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16,875,000
|
|
Credit Suisse Securities (USA) LLC
|
|
$
|
16,875,000
|
|
Goldman, Sachs & Co.
|
|
$
|
11,250,000
|
|
Morgan Stanley & Co. Incorporated
|
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$
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11,250,000
|
|
|
|
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Total
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US$
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450,000,000
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SCHEDULE III
Filed Pursuant to Rule 433 of the Act
Registration No. 333-148655
November 9, 2009
Pioneer Natural Resources Company
Pricing Term Sheet
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Issuer:
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Pioneer Natural Resources Company
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Security Type:
|
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SEC Registered
|
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Principal Amount:
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$450,000,000
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Ratings:
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Ba1 / BB+ / BB+ (Negative/Negative/Stable)
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Coupon:
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7.50%
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Stated Maturity Date:
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January 15, 2020
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Issue Price:
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99.142% of face amount
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Yield to Maturity:
|
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7.625%
|
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US Treasury Benchmark:
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3.625% due August 15, 2019
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US Treasury Yield:
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3.488%
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Spread to US Treasury:
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4.137 %
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Trade Date:
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November 9, 2009
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Original Issue/Settlement Date:
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November 13, 2009
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Interest Payment Dates:
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January 15 and July 15 commencing January 15, 2010
|
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Make Whole Call:
|
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Greater of par or T+50bps
|
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Joint Book-Running Managers:
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Deutsche Bank Securities Inc.
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J.P. Morgan Securities Inc.
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Wells Fargo Securities, LLC
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RBS Securities Inc.
|
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UBS Securities LLC
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Senior Co-Managers:
|
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Banc of America Securities LLC
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BMO Capital Markets Corp.
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Citigroup Global Markets Inc.
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Credit Suisse Securities (USA) LLC
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Co-Managers:
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Goldman, Sachs & Co.
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Morgan Stanley & Co. Incorporated
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Note:
A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time.
The Issuer has filed a registration statement (including a prospectus) with the SEC for the
offering to which this communication relates. Before you invest, you should read the prospectus in
that registration statement and other documents the Issuer has filed with the SEC for more complete
information about the Issuer and this offering. You may get these documents for free by visiting
EDGAR on the SEC Web site at www.sec.gov. Alternatively, the Issuer, any underwriter or any dealer
participating in the offering will arrange to send you the prospectus if you request it by calling
Deutsche Bank Securities Inc. toll free at 1-800-503-4611, J.P. Morgan Securities Inc. at
1-866-430-0686 or Wells Fargo Securities, LLC at (704) 715-7035.
ANY DISCLAIMER OR OTHER NOTICES THAT MAY APPEAR BELOW ARE NOT APPLICABLE TO THIS COMMUNICATION AND
SHOULD BE DISREGARDED, SUCH DISCLAIMERS OR OTHER NOTICES WERE AUTOMATICALLY GENERATED AS A RESULT
OF THIS COMMUNICATION BEING SENT VIA BLOOMBERG OR ANOTHER EMAIL SYSTEM.
I-1
ANNEX I
Opinion of Vinson & Elkins, LLP
Counsel to the Company
(i) The Company has been duly incorporated and is an existing corporation in good
standing under the laws of the State of Delaware. The Company has corporate power and
authority to own and lease its properties and conduct its business as described in the
Disclosure Package and the Final Prospectus.
(ii) Pioneer Natural Resources USA, Inc. (“
Pioneer USA
”) has been duly incorporated and
is an existing corporation in good standing under the laws of the State of Delaware. Pioneer
USA has corporate power and authority to own and lease its properties and conduct its
business as described in the Disclosure Package and the Final Prospectus.
(iii) The Company has an authorized capitalization as described in the Disclosure
Package and the Final Prospectus.
(iv) The Securities, when issued and delivered, will conform in all material respects
as to legal matters to the description contained in the Disclosure Package and the Final
Prospectus, under the caption “Description of Notes” and “Description of Debt Securities”.
(v) The Company has duly authorized, executed and delivered the Underwriting Agreement.
(vi) No consent, approval, authorization or order of, or filing with, any governmental
agency or body or any court is required for the consummation of the transactions
contemplated by the Underwriting Agreement in connection with the issuance or sale of the
Securities by the Company, except such as have been obtained and made under the Act, the
Exchange Act or the Trust Indenture Act and such as may be required under state securities
laws.
(vii) The execution, delivery and performance of the Underwriting Agreement, the
Original Indenture, the Second Supplemental Indenture and the Securities by the Company and
the issuance and sale of the Securities by the Company will not result in a breach or
violation of any of the terms and provisions of the Restated Certificate of Incorporation or
Bylaws of the Company.
(viii) The execution, delivery and performance of the Underwriting Agreement, the
Original Indenture, the Second Supplemental Indenture and the Securities by the Company and
the issuance and sale of the Securities by the Company will not result in a violation of any
statute, any rule or, to our knowledge, any regulation of any governmental agency or body
having jurisdiction over the Company or any subsidiary of the Company or any of its
properties.
I-2
(ix) The execution, delivery and performance of the Underwriting Agreement, the
Original Indenture and the Second Supplemental Indenture by the Company and the issuance and
sale of the Securities will not result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any order known to us of any governmental
agency or body in any court having jurisdiction over the Company or any subsidiary of the
Company or any of its properties, or any agreement or instrument included as an exhibit to a
Form 10-K, Form 10-Q or Form 8-K filed by the Company with the Commission under the Exchange
Act, to which the Company or any subsidiary is a party or by which the Company or any
subsidiary is bound or to which any of the properties of the Company or any such subsidiary
is subject.
(x) The Company has full corporate power and authority to authorize, issue and sell the
Securities as contemplated by the Underwriting Agreement.
(xi) The Registration Statement has become effective under the Act.
(xii) The Final Prospectus was filed with the Commission pursuant to Rule 424(b)(5) on
November 10, 2009.
(xiii) To the best of our knowledge, no stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued and no proceedings for that
purpose have been instituted or are pending or contemplated under the Act.
(xiv) The Registration Statement, as of its effective date and as of the date of the
Underwriting Agreement, appears on its face to comply as to form in all material respects
with the requirements of the Act, the rules and regulations issued by the Commission
thereunder and the Trust Indenture Act.
(xv) The Final Prospectus, as of its date, and each amendment or supplement thereto, as
of the date hereof, appears on its face to comply as to form in all material respects with
the requirements of the Act and the rules and regulations issued by the Commission
thereunder and the Trust Indenture Act.
(xvi) The Disclosure Package, as of the Initial Sale Time, appears on its face to
comply as to form in all material respects with the requirements of the Act and the rules
and regulations issued by the Commission thereunder.
(xvii) The Original Indenture and the Second Supplemental Indenture have been duly
authorized, executed and delivered by the Company.
(xviii) The Original Indenture has been duly qualified under the Trust Indenture Act.
(xix) The Original Indenture and the Second Supplemental Indenture constitute legal,
valid and binding obligations of the Company enforceable against the Company in accordance
with their terms (subject, as to enforcement of legal remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting creditors’ rights generally
from time to time in effect, and, as to remedies of specific performance
I-3
and injunctive and other forms of equitable relief, to equitable defenses or principles
and to the discretion of the court before which any proceeding may therefor be brought).
(xx) The Securities have been duly authorized and executed and, when authenticated in
accordance with the Indenture and delivered to and paid for by the Underwriters pursuant to
the Underwriting Agreement, will constitute legal, valid and binding obligations of the
Company entitled to the benefits of the Indenture and enforceable against the Company in
accordance with their terms (subject, as to enforcement of legal remedies, to applicable
bankruptcy, reorganization, insolvency, moratorium or other laws affecting creditors’ rights
generally from time to time in effect, and, as to remedies of specific performance and
injunctive and other forms of equitable relief, to equitable defenses or principles and to
the discretion of the court before which any proceeding may therefor be brought).
We have participated in conferences with officers and other representatives of the Company,
in-house attorneys for the Company, representatives of the registered public accountants for the
Company, representatives of the Underwriters and counsel for the Underwriters at which the contents
of the Registration Statement, the Disclosure Package, the Final Prospectus and related matters
were discussed and, although we did not verify such information and are not passing on and do not
assume responsibility for, or express any opinion regarding the accuracy, completeness or fairness
of the statements contained in the Registration Statement, the Disclosure Package or the Final
Prospectus, on the basis of the foregoing in the course of acting as counsel to the Company in this
transaction (and relying as to materiality as to factual matters on officers, employees and other
representatives of the Company), no facts have come to our attention that have caused us to believe
that (a) the Registration Statement, at the time it became effective, as of the Initial Sale Time
and as of the Closing Date, contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements therein not
misleading, (b) the Final Prospectus, as of the date of the Underwriting Agreement and as of the
Closing Date, contained an untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading or (c) the Disclosure Package as of the Initial Sale Time and as of
the Closing Date, contained an untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. We express no opinion, view belief or comment with
respect to the form, accuracy, completeness or fairness of the financial statements, notes or
schedules thereto, other financial data, natural resource reserves or engineering information or
data or estimated future net revenues therefrom, whether or not discounted, included in the
Registration Statement, the Disclosure Package or the Final Prospectus.
I-4
ANNEX II
Opinion of General Counsel to the Company
(i) The Company is duly qualified to do business as a foreign corporation in good standing in
all jurisdictions where its ownership or leasing of properties or the conduct of its business
requires such qualification, except where the failure so to register or qualify does not have a
material adverse effect on the condition (financial or other), business or results of operations of
the Company and its subsidiaries considered as a whole.
(ii) Pioneer Natural Resources USA, Inc. (“
Pioneer USA
”) is duly qualified to do business as a
foreign corporation in good standing in all jurisdictions where its ownership or leasing of
properties or the conduct of its business requires such qualification, except where the failure so
to register or qualify does not have a material adverse effect on the condition (financial or
other), business or results of operations of the Company and its subsidiaries considered as a
whole.
(iii) All outstanding shares of capital stock of Pioneer USA have been duly authorized and
validly issued, are fully paid and nonassessable and are owned by the Company free and clear of any
liens, encumbrances, equities or claims, except as described in the Registration Statement, the
Disclosure Package and the Final Prospectus, and other than those arising under the Company’s bank
line of credit.
I have participated in conferences with officers and other representatives of the Company,
representatives of counsel for the Company, representatives of the registered public accountants
for the Company, representatives of the Underwriters and counsel for the Underwriters at which the
contents of the Registration Statement, the Disclosure Package, the Final Prospectus and related
matters were discussed and, although I did not verify such information and am not passing on and do
not assume responsibility for, or express any opinion regarding the accuracy, completeness or
fairness of the statements contained in the Registration Statement, the Disclosure Package or the
Final Prospectus, on the basis of the foregoing in the course of acting as General Counsel to the
Company (and relying as to materiality as to factual matters on officers, employees and other
representatives of the Company), no facts have come to my attention that have caused me to believe
that (a) the Registration Statement, at the time it became effective or on the date of the
Underwriting Agreement, contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements therein not
misleading, (b) the Final Prospectus, as of the date the Final Prospectus was issued and as of the
Closing Date, contained an untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading or (c) the Disclosure Package as of the Initial Sale Time and as of
the Closing Date, contained an untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. I express no opinion, view belief or comment with
respect to the form, accuracy, completeness or fairness of the financial statements, notes or
schedules thereto, other financial data, natural resource reserves or engineering information or
data or estimated future net revenues therefrom, whether or
II-1
not discounted, included in the Registration Statement, the Disclosure Package or the Final
Prospectus.
II-2
Exhibit 4.1
EXECUTION VERSION
SECOND SUPPLEMENTAL INDENTURE
by and among
PIONEER NATURAL RESOURCES COMPANY,
PIONEER NATURAL RESOURCES USA, INC.,
and
WELLS FARGO BANK, NATIONAL ASSOCIATION
as Trustee
Dated as of November 13, 2009
Supplement to Indenture for Debt Securities
Dated as of January 22, 2008
7.50% Senior Notes due 2020
Table of Contents
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Page
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Section 1.
|
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Notes
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2
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Section 2.
|
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Optional Redemption of Notes
|
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3
|
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Section 3.
|
|
Offer to Repurchase Upon a Change of Control Repurchase Event.
|
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5
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Section 4.
|
|
Obligation to Guarantee
|
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6
|
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Section 5.
|
|
Additional Covenants of the Company.
|
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7
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Section 6.
|
|
Amendments to Sections 1.01, 2.07 and 2.15.
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8
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Section 7.
|
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Ratification
|
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17
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Section 8.
|
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No Security Interest Created
|
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17
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Section 9.
|
|
Table of Contents, Headings, Etc
|
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17
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Section 10.
|
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Severability
|
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17
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Section 11.
|
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Counterparts
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17
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Section 12.
|
|
Governing Law
|
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18
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Section 13.
|
|
Trustee Not Responsible for Recitals or Issuance of Notes
|
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18
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SECOND SUPPLEMENTAL INDENTURE
THIS SECOND SUPPLEMENTAL INDENTURE dated as of November 13, 2009 (this “Supplemental
Indenture”), among Pioneer Natural Resources Company, a Delaware corporation (the “Company”),
Pioneer Natural Resources USA, Inc., a Delaware corporation, for purposes of agreeing to make
certain guarantees pursuant to Section 4 hereof (the “Guarantor”), and Wells Fargo Bank, National
Association, national banking association organized under the laws of the United States of America,
as trustee (the “Trustee”). Capitalized terms used herein and not otherwise defined have the
meanings set forth in the Indenture referred to below.
RECITALS
A. The Company and the Trustee, entered into that certain Indenture, dated as of January 22,
2008 (the “Indenture”), pursuant to which the Company may from time to time issue its debentures,
notes, bonds or other evidences of indebtedness (collectively, the “Debt Securities”).
B. Section 9.01 of the Indenture provides that the Company, when authorized by a resolution of
the Board of Directors of the Company, and the Trustee may, without the consent of the holders of
the Debt Securities, enter into a supplemental indenture to establish the form or terms of Debt
Securities of any series as permitted by Sections 2.01 and 2.03 of the Indenture.
C.
The Company desires to issue, and upon certain events specified in this Supplemental
Indenture, the Guarantor desires to agree to be obligated to guarantee, $450,000,000 aggregate
principal amount of 7.50% Senior Notes due 2020 (the “Notes”) and in connection therewith, the
Company and the Guarantor have duly determined to make, execute and deliver this Supplemental
Indenture to set forth the terms and provisions of the Notes as required by the Indenture.
D.
The Company has determined that this Supplemental Indenture is authorized or permitted by
Section 9.01 of the Indenture and has delivered to the Trustee an Opinion of Counsel and Officers’
Certificate to the effect that all conditions precedent provided for in the Indenture to the
execution and delivery of this Supplemental Indenture have been complied with.
E.
All things necessary to make the Notes, when executed by the Company and authenticated and
delivered by the Trustee or a duly authorized authenticating agent, as provided in the Indenture,
the valid and legally binding obligations of the Company, have been done.
F. All things necessary to make this Supplemental Indenture a valid and legally binding
indenture and agreement according to its terms, and a valid and legally binding amendment of, and
supplement to, the Indenture have been done.
NOW, THEREFORE, in consideration of the mutual agreements and covenants set forth herein, the
parties hereto agree, subject to the terms and conditions hereinafter set forth, as follows for the
benefit of the Trustee and the Holders of the Notes:
1
AGREEMENT
Section 1.
Notes
. Pursuant to Section 2.03 of the Indenture, the terms and provisions
of the Notes are as follows:
(a) The title of the Notes shall be designated as the “7.50% Senior Notes due 2020.”
(b) The Notes shall be initially limited to $450,000,000 aggregate principal amount. The
Company may, without the consent of the Holders of the Notes, increase such aggregate principal
amount in the future, on the same terms and conditions and with the same CUSIP numbers as the
Notes. The Company shall not issue any such additional Notes unless the additional Notes are
fungible with the Notes for United States federal income tax purposes.
(c) The Notes shall not require any principal or premium payments prior to maturity on January
15, 2020.
(d) The rate at which the Notes shall bear interest shall be 7.50% per annum; interest on the
Notes shall accrue from November 13, 2009, for the first interest payment and from the most recent
interest payment date thereafter; the interest payment dates on which such interest shall be
payable shall be January 15 and July 15, beginning January 15, 2010 (each an “Interest Payment
Date”); and the record dates for the determination of the holders of the Notes to whom such
interest is payable shall be the immediately preceding January 1 (for January 15 payment dates) and
July 1 (for July 15 payment dates) (each an “Interest Record Date”); the rate at which the overdue
principal shall bear interest shall be 1% per annum in excess of the rate stated initially in this
clause to the extent lawful; and the rate at which overdue installments of interest shall bear
interest shall be 1% per annum in excess of the rate stated initially in this clause to the extent
lawful.
(e) Payments of principal of and interest on the Notes represented by one or more Global
Senior Notes initially registered in the name of The Depository Trust Company (the “Depositary”) or
its nominee with respect to the Notes shall be made by the Company through the Trustee in
immediately available funds to the Depositary or its nominee, as the case may be.
(f) The Notes shall be redeemable at any time, at the option of the Company, in whole or from
time to time in part, at the price, and otherwise in accordance with the terms and provisions, set
forth in Section 2 of this Supplemental Indenture and (to the extent they do not conflict with
Section 2 of this Supplemental Indenture) the terms and provisions of Sections 3.03 and 3.04 of the
Indenture.
(g) The Notes shall be represented by one or more Global Senior Notes deposited with the
Depositary and registered in the name of the nominee of the Depositary.
(h) There shall be no mandatory sinking fund for the payments of the Notes.
(i) As long as the Depositary or its nominee, or a successor Depositary or its nominee, is the
registered owner of the Global Senior Notes relating to the Notes, owners of the beneficial
interests in such Global Senior Notes shall not be entitled to have the Notes registered in their
names and shall not receive or be entitled to receive physical delivery of Notes in
2
definitive form except (i) as provided in Section 2.15(c) of the Indenture or (ii) if an Event
of Default with respect to the Notes has occurred and is continuing.
(j) Wells Fargo Bank, National Association shall be the trustee for the Notes under the
Indenture.
(k) Article X of the Indenture shall apply to the Notes.
(l) The Notes shall not be subordinated pursuant to the provisions of Article XII of the
Indenture. The Notes shall be senior unsecured obligations of the Company ranking
pari passu
with
other existing and future senior unsecured indebtedness of the Company.
(m) The Company shall be subject to all the covenants set forth in Article IV of the Indenture
with respect to the Notes.
(n) To the extent not set forth herein, the provisions of Section 2.03 of the Indenture are
not applicable.
(o) Initially, the Trustee shall act as Paying Agent and Registrar. Interest shall be payable
at the office or agency of the Company maintained by the Company for such purposes in the United
States, which shall initially be the office of the Paying Agent at Sixth and Marquette,
Minneapolis, Minnesota 55479. The Company shall pay interest on any Notes in certificated form by
check mailed to the address of the Person entitled thereto as it appears in the Debt Security
Register (or upon written application by such Person to the Trustee and Paying Agent (if different
from the Trustee) not later than the relevant Interest Record Date, by wire transfer in immediately
available funds to such Person’s account within the United States, if such Person is entitled to
interest on an aggregate principal in excess of $1,000,000, which application shall remain in
effect until the Holder notifies the Trustee and Paying Agent to the contrary).
Section 2.
Optional Redemption of Notes
. The Notes will be redeemable at any time, at
the option of the Company, in whole or from time to time in part, upon not less than 30 and not
more than 60 days’ notice as provided in the Indenture, on any date prior to maturity (the
“Redemption Date”) at a price equal to 100% of the principal amount thereof plus accrued and unpaid
interest, if any, to the Redemption Date (subject to the right of Holders of record on the relevant
record date to receive interest due on any interest payment date that is on or prior to the
Redemption Date) plus a Make-Whole Premium, if any (the “Redemption Price”). In no event will a
Redemption Price ever be less than 100% of the principal amount of the Notes plus accrued and
unpaid interest, if any, to the Redemption Date.
The amount of the Make-Whole Premium with respect to any of the Notes (or portion thereof) to
be redeemed will be equal to the excess, if any, of:
(a) the sum of the present values, calculated as of the Redemption Date, of:
(i) each interest payment that, but for such redemption, would have been payable on such Note
(or portion thereof) being redeemed on each interest payment date occurring after the Redemption
Date (excluding any accrued interest for the period prior to the Redemption Date); and
3
(ii) the principal amount that, but for such redemption, would have been payable at the final
maturity of such Note (or portion thereof) being redeemed; over
(b) the principal amount of such Note (or portion thereof) being redeemed.
The present values of interest and principal payments referred to in clause (a) above will be
determined in accordance with generally accepted principles of financial analysis. Such present
values will be calculated by discounting the amount of each payment of interest or principal from
the date that each such payment would have been payable, but for the redemption, to the Redemption
Date at a discount rate equal to the Treasury Yield (as defined below) plus 50 basis points.
The Make-Whole Premium will be calculated by an independent investment banking institution of
national standing appointed by the Company; provided that if the Company fails to make such
appointment at least 30 business days prior to the Redemption Date, or if the institution so
appointed is unwilling or unable to make such calculation, such calculation will be made by an
independent investment banking institution of national standing appointed by the Trustee (in any
such case, an “Independent Investment Banker”).
For purposes of determining the Make-Whole Premium, “Treasury Yield” means a rate of interest
per annum equal to the weekly average yield to maturity of United States Treasury Notes that have a
constant maturity that corresponds to the remaining term to maturity of the applicable Notes,
calculated to the nearest 1/12th of a year (the “Remaining Term”). The Treasury Yield will be
determined as of the third business day immediately preceding the applicable Redemption Date.
The weekly average yields of United States Treasury Notes will be determined by reference to
the most recent statistical release published by the Federal Reserve Bank of New York and
designated “H.15 (519) Selected Interest Rates” or any successor release (the “H.15 Statistical
Release”). If the H.15 Statistical Release sets forth a weekly average yield for United States
Treasury Notes having a constant maturity that is the same as the Remaining Term, then the Treasury
Yield will be equal to such weekly average yield. In all other cases, the Treasury Yield will be
calculated by interpolation, on a straight-line basis, between the weekly average yields on the
United States Treasury Notes that have a constant maturity closest to and greater than the
Remaining Term and the United States Treasury Notes that have a constant maturity closest to and
less than the Remaining Term (in each case as set forth in the H.15 Statistical Release). Any
weekly average yields so calculated by interpolation will be rounded to the nearest 1/100th of 1%,
with any figure of 1/200th of 1% or above being rounded upward. If weekly average yields for United
States Treasury Notes are not available in the H.15 Statistical Release or otherwise, then the
Treasury Yield will be calculated by interpolation of comparable rates selected by the Independent
Investment Banker.
In the case of any partial redemption, selection of the Notes for redemption will be made by
the Trustee on a pro rata basis, by lot or by such other method as the Trustee in its sole
discretion shall deem to be fair and appropriate, although no such Note of $1,000 in original
principal amount or less shall be redeemed in part. If any Note is to be redeemed in part only,
the notice of redemption relating to such Note shall state the portion of the principal amount
4
thereof to be redeemed. A new Note in principal amount equal to the unredeemed portion
thereof will be issued in the name of the Holder thereof upon cancellation of the original Note.
Section 3.
Offer to Repurchase Upon a Change of Control Repurchase Event
.
(a) If a Change of Control Repurchase Event occurs, unless the Company has otherwise exercised
its right to redeem the Notes, the Company will make an offer to each Holder of Notes to repurchase
all or any portion (equal to $1,000 or an integral multiple of $1,000) of such Holder’s Notes at a
price in cash equal to 101% of the aggregate principal amount of Notes repurchased plus accrued and
unpaid interest, if any, on the Notes repurchased to the date of repurchase (the “Change of Control
Repurchase Event Payment”). Within 30 days following any Change of Control Repurchase Event, the
Company will mail a notice (the “Change of Control Repurchase Event Offer”) to each holder
describing the transaction or transactions that constitute the Change of Control Repurchase Event
and stating:
(i) that the Change of Control Repurchase Event Offer is being made pursuant to the Change of
Control Repurchase Event provisions of the Notes and that all Notes tendered will be accepted for
payment;
(ii) the purchase price and the purchase date, which shall be no earlier than 30 days and no
later than 60 days from the date such notice is mailed (the “Change of Control Repurchase Event
Payment Date”);
(iii) that any Note not tendered will continue to accrue interest;
(iv) that, unless the Company defaults in the payment of the Change of Control Repurchase
Event Payment, all Notes accepted for payment pursuant to the Change of Control Repurchase Event
Offer will cease to accrue interest after the Change of Control Repurchase Event Payment Date;
(v) that Holders electing to have any Notes purchased pursuant to a Change of Control
Repurchase Event Offer will be required to surrender the Notes to the paying agent at the address
specified in the notice prior to the close of business on the third business day preceding the
Change of Control Repurchase Event Payment Date;
(vi) that Holders will be entitled to withdraw their election if the paying agent receives,
not later than the close of business on the second business day preceding the Change of Control
Repurchase Event Payment Date, a telegram, telex, facsimile transmission or letter setting forth
the name of the Holder, the principal amount of Notes delivered for purchase, and a statement that
such Holder is withdrawing his election to have the Notes purchased; and
(vii) that Holders whose Notes are being purchased only in part will be issued new Notes equal
in principal amount to the unpurchased portion of the Notes surrendered, which unpurchased portion
must be equal to $1,000 in principal amount or an integral multiple thereof.
The Company will comply with the requirements of Rule 14e-1 under the Exchange Act, and any
other securities laws and regulations thereunder to the extent those laws and regulations are
applicable in connection with the repurchase of the Notes as a result of a Change of Control
5
Repurchase Event. To the extent that the provisions of any securities laws or regulations
conflict with the Change of Control Repurchase Event provisions of the Notes, the Company will
comply with the applicable securities laws and regulations and will not be deemed to have breached
its obligations under the Change of Control Repurchase Event provisions of the Notes by virtue of
such conflict.
(b) On the Change of Control Repurchase Event Payment Date, the Company will, to the extent
lawful:
(i) accept for payment all Notes or portions of Notes properly tendered pursuant to the
Company’s offer;
(ii) deposit with the paying agent an amount equal to the aggregate purchase price in respect
of all Notes or portions of Notes properly tendered; and
(iii) deliver or cause to be delivered to the Trustee the Notes properly accepted, together
with an Officers’ Certificate stating the aggregate principal amount of Notes or portions of Notes
being purchased by the Company.
The paying agent will promptly mail to each holder of Notes properly tendered the purchase
price for such Notes, and the Trustee will promptly authenticate and mail (or cause to be
transferred by book entry) to each holder a new Note equal to the principal amount of any
unpurchased portion of the Notes surrendered, if any; provided, that each new Note will be issued
in denominations of $1,000 or integral multiples of $1,000.
(c) Except as described above with respect to a Change of Control Repurchase Event, the
Indenture does not contain any other provisions that permit the holders of the Notes to require the
Company to repurchase or redeem the Notes in the event of a takeover, recapitalization or similar
transaction.
(d) The Company will not be required to make a Change of Control Repurchase Event Offer if a
third party makes an offer in the manner applicable to an offer made by the Company, at the times
and otherwise in compliance with the requirements set forth in the Indenture, and such third party
purchases all Notes properly tendered and not withdrawn under its offer.
Section 4.
Obligation to Guarantee
. If at any time any of the Company’s 5.875% Senior
Notes due 2012, 5.875% Senior Notes due 2016, 6.65% Senior Notes due 2017, 6.875% Senior Notes due
2018, 7.20% Senior Notes due 2028 or 2.875% Convertible Senior Notes due 2038 (the “2.875% Notes,”
and collectively with all other senior notes, the “Existing Senior Notes”) are guaranteed by the
Guarantor pursuant to the terms of the indentures under which such Existing Senior Notes were
issued or any applicable supplemental indenture related to such Existing Senior Notes, then the
Company, the Guarantor and the Trustee shall as soon as reasonably practicable thereafter execute
and deliver a supplemental indenture to the Indenture pursuant to which the Guarantor shall
unconditionally guarantee the Notes on substantially the same terms as the Guarantor shall have
guaranteed such Existing Senior Notes; provided, however, that if the Guarantor is not required to
guarantee the 2.875% Notes or if the 2.875% Notes are no longer outstanding, then the Guarantor
shall guarantee the Notes on substantially
6
the same terms as the most recently issued series of Existing Senior Notes that are
guaranteed. The Company, the Guarantor and the Trustee, as applicable, also shall execute and
deliver such other documents, instruments or certificates as are reasonably necessary or
appropriate to effect the required guarantee of the Notes.
Section 5.
Additional Covenants of the Company
.
(a)
Limitation on Liens
. The Company shall not, and shall not permit any of its
Subsidiaries to create or permit to exist any Lien on any Principal Property or shares of capital
stock or Indebtedness of a Subsidiary of the Company that owns or leases Principal Property,
whether owned on the date on which the Notes were originally issued or thereafter acquired,
securing any obligation unless the Company contemporaneously secures the Notes equally and ratably
with (or prior to) such obligation until such time as such obligations are no longer secured by a
Lien. The preceding sentence shall not require the Company to secure the Notes if the Lien
consists of either of the following:
(i) Permitted Liens; or
(ii) Liens securing Indebtedness if, after giving pro forma effect to the Incurrence of such
Indebtedness (and the receipt and application of the proceeds thereof) or the securing of
outstanding Indebtedness, the sum of (without duplication) (x) all Indebtedness of the Company and
its Subsidiaries secured by Liens on Principal Property (other than Permitted Liens) and (y) all
Attributable Indebtedness in respect of Sale and Leaseback Transactions with respect to any
Principal Property, at the time of determination does not exceed 15% of Adjusted Consolidated Net
Tangible Assets.
(b)
Limitation on Sale and Leaseback Transactions
. The Company shall not, and shall
not permit any of its Subsidiaries to, directly or indirectly, enter into any Sale and Leaseback
Transaction with respect to any Principal Property unless either, (i) the Company or such
Subsidiary would be entitled to create a Lien on such Principal Property securing Indebtedness in
an amount equal to the Attributable Indebtedness with respect to such Sale and Leaseback
Transaction without securing the Notes pursuant to Section 5(a) of this Supplemental Indenture or
(ii) or the Company, within six months after the effective date of such Sale and Leaseback
Transaction, applies to the voluntary defeasance or retirement of Notes or other Indebtedness an
amount equal to the Attributable Indebtedness in respect of such Sale and Leaseback Transaction.
(c)
Stay, Extension and Usury Laws
. The Company covenants (to the extent that it may
lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay, extension or usury law or other law that would
prohibit or forgive the Company from paying all or any portion of the principal of or interest on
the Notes as contemplated herein, wherever enacted, now or at any time hereafter in force, or that
may affect the covenants or the performance of the Indenture; and the Company (to the extent it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants
that it will not, by resort to any such law, hinder, delay or impede the execution of any power
herein granted to the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
7
Section 6. Amendments to Sections 1.01, 2.07 and 2.15.
(a)
Section 1.01
. Section 1.01 is hereby amended, solely with respect to the Notes,
by:
(i) adding a definition of “Adjusted Consolidated Net Tangible Assets” as follows:
“Adjusted Consolidated Net Tangible Assets” means (without duplication), as of the
date of determination, the remainder of:
(a) the sum of (i) discounted future net revenues from proved oil and gas
reserves of the Company and its Subsidiaries calculated in accordance with SEC
guidelines before any provincial, territorial, state, Federal or foreign income
taxes, as estimated by the Company in a reserve report prepared as of the end of the
Company’s most recently completed fiscal year for which audited financial statements
are available, as increased by, as of the date of determination, the estimated
discounted future net revenues from (A) estimated proved oil and gas reserves
acquired since such year end, which reserves were not reflected in such year end
reserve report, and (B) estimated oil and gas reserves attributable to upward
revisions of estimates of proved oil and gas reserves since such year end due to
exploration, development or exploitation activities, in each case calculated in
accordance with SEC guidelines (utilizing the prices utilized in such year end
reserve report), and decreased by, as of the date of determination, the estimated
discounted future net revenues from (C) estimated proved oil and gas reserves
produced or disposed of since such year end, and (D) estimated oil and gas reserves
attributable to downward revisions of estimates of proved oil and gas reserves since
such year end due to changes in geological conditions or other factors which would,
in accordance with standard industry practice, cause such revisions, in each case
calculated on a pre-tax basis and substantially in accordance with SEC guidelines
(utilizing the prices utilized in such year end reserve report), in each case as
estimated by the Company’s petroleum engineers or any independent petroleum
engineers engaged by the Company for that purpose; (ii) the capitalized costs that
are attributable to oil and gas properties of the Company and its Subsidiaries to
which no proved oil and gas reserves are attributable, based on the Company’s books
and records as of a date no earlier than the date of the Company’s latest available
annual or quarterly financial statements; (iii) the Net Working Capital on a date no
earlier than the date of the Company’s latest annual or quarterly financial
statements; and (iv) the greater of (A) the net book value of other tangible assets
of the Company and its Subsidiaries, as of a date no earlier than the date of the
Company’s latest annual or quarterly financial statement, and (B) the appraised
value, as estimated by independent appraisers, of other tangible assets of the
Company and its Subsidiaries, as of a date no earlier than the date of the Company’s
latest audited financial statements; minus
8
(b) the sum of (i) noncontrolling interests in consolidating subsidiaries; (ii)
any net gas balancing liabilities of the Company and its Subsidiaries reflected in
the Company’s latest audited financial statements; (iii) to the extent included in
(a)(i) above, the discounted future net revenues, calculated in accordance with SEC
guidelines (utilizing the prices utilized in the Company’s year end reserve report),
attributable to reserves which are required to be delivered to third parties to
fully satisfy the obligations of the Company and its Subsidiaries with respect to
Volumetric Production Payments (determined, if applicable, using the schedules
specified with respect thereto); and (iv) the discounted future net revenues,
calculated in accordance with SEC guidelines, attributable to reserves subject to
Dollar-Denominated Production Payments which, based on the estimates of production
and price assumptions included in determining the discounted future net revenues
specified in (a)(i) above, would be necessary to fully satisfy the payment
obligations of the Company and its Subsidiaries with respect to Dollar-Denominated
Production Payments (determined, if applicable, using the schedules specified with
respect thereto).
If the Company changes its method of accounting from the successful efforts
method to the full cost or a similar method of accounting, “Adjusted Consolidated
Net Tangible Assets” will continue to be calculated as if the Company were still
using the successful efforts method of accounting.
(ii) adding a definition of “Attributable Indebtedness” as follows:
“Attributable Indebtedness” in respect of a Sale and Leaseback Transaction means, as
of the time of determination, (a) if the obligation in respect of such Sale and
Leaseback Transaction is a Capitalized Lease Obligation, the amount equal to the
capitalized amount of such obligation determined in accordance with GAAP and
included in the financial statements of the lessee or (b) if the obligation in
respect of such Sale and Leaseback Transaction is not a Capitalized Lease
Obligation, the amount equal to the total Net Amount of Rent required to be paid by
the lessee under such lease during the remaining term thereof (including any period
for which the lease has been extended), discounted from the respective due dates
thereof to such determination date at the rate per annum borne by the Notes
compounded semi annually.
(iii) adding a definition of “Change of Control” as follows:
“Change of Control” means the occurrence of any of the following events:
(a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d)
of the Exchange Act or any successor provisions to either of the foregoing) of
persons become the “beneficial owners” (as defined in Rule 13d-3 under the Exchange
Act, except that a person will be deemed to have “beneficial ownership” of all
shares that any such person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or indirectly,
of more than 50% of the total voting power of the Voting Stock of the
9
Company, whether as a result of the issuance of securities of the Company, any
merger, consolidation, liquidation or dissolution of the Company or otherwise; or
(b) the sale, transfer, assignment, lease, conveyance or other disposition,
directly or indirectly, of all or substantially all the assets of the Company and
its subsidiaries, considered as a whole (other than a disposition of such assets as
an entirety or virtually as an entirety to a wholly-owned subsidiary) shall have
occurred, or the Company merges, consolidates or amalgamates with or into any other
person or any other person merges, consolidates or amalgamates with or into the
Company, in any such event pursuant to a transaction in which the outstanding Voting
Stock of the Company is reclassified into or exchanged for cash, securities or other
property, other than any such transaction where:
(i) the outstanding Voting Stock of the Company is reclassified into or
exchanged for other Voting Stock of the Company or for Voting Stock of the surviving
corporation, and
(ii) the holders of the Voting Stock of the Company immediately prior to such
transaction own, directly or indirectly, not less than a majority of the Voting
Stock of the Company or the surviving corporation immediately after such transaction
and in substantially the same proportion as before the transition; or
(c) during any period, individuals who at the beginning of such period
constituted the Board of Directors (together with any new directors whose election
or appointment by such Board or whose nomination for election by the stockholders of
the Company was approved by a vote of not less than a majority of the directors then
still in office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any reason
to constitute a majority of the Board of Directors then in office; or
(d) the stockholders of the Company shall have approved any plan of liquidation
or dissolution of the Company.
(iv) adding a definition of “Change of Control Repurchase Event” as follows:
“Change of Control Repurchase Event” means the occurrence of both a Change of
Control and a Rating Decline.
(v) adding a definition of “Consolidated Net Worth” as follows:
“Consolidated Net Worth” of any Person means the stockholders’ equity of such Person
and its Subsidiaries, as determined on a consolidated basis in accordance with GAAP,
less (to the extent included in stockholders’ equity) amounts attributable to
Redeemable Stock of such Person or its Subsidiaries.
10
(vi) deleting the definition of “Credit Agreement” and substituting therefore the definition
that follows:
“Credit Agreement” means the Amended and Restated Credit Facility Agreement, dated
as of April 11, 2007, among the Company, as Borrower, JPMorgan Chase Bank, N.A. as
Administrative Agent, JPMorgan Chase Bank, N.A., Wachovia Bank, National Association
and Bank of America, N.A., as Issuing Banks, JPMorgan Chase Bank, N.A., and Wachovia
Bank, National Association, as Swingline Lenders, the Lenders party thereto,
Wachovia Bank, National Association, as Syndication Agent, Bank of America, N.A.,
Deutsche Bank Securities Inc. and Wells Fargo Bank, National Association, as
Co-Documentation Agents, and J.P. Morgan Securities Inc. and Wachovia Capital
Markets, LLC, as Co-Arrangers and Joint Bookrunners, as supplemented, amended or
modified or Refinanced from time to time. It is understood and agreed that the
Credit Agreement may be refinanced, refunded, extended, renewed or replaced (through
one or more such refinancings, refundings, extensions, renewals or replacements), as
a whole, or in part, from time to time after the termination of the applicable
Credit Agreement.
(vii) adding a definition of “Dollar-Denominated Production Payments” as follows:
“Dollar-Denominated Production Payments” means production payment obligations
recorded as liabilities in accordance with GAAP, together with all undertakings and
obligations in connection therewith.
(viii) adding a definition of “Government Contract Lien” as follows:
“Government Contract Lien” means any Lien required by any contract, statute,
regulation or order in order to permit the Company or any of its Subsidiaries to
perform any contract or subcontract made by it with or at the request of the United
States or any State thereof or any department, agency or instrumentality of either
or to secure partial, progress, advance or other payments by the Company or any of
its Subsidiaries to the United States or any State thereof or any department, agency
or instrumentality of either pursuant to the provisions of any contract, statute,
regulation or order.
(ix) adding a definition of “Investment Grade” as follows:
“Investment Grade” means BBB- or higher by S&P and Baa3 or higher by Moody’s, or the
equivalent of such ratings by S&P or Moody’s, or, if either S&P and Moody’s shall
not make a rating on the notes publicly available, another Rating Agency.
(x) adding a definition of “Lien” as follows:
“Lien” means any mortgage, pledge, security interest, encumbrance, lien, charge or
adverse claim affecting title or resulting in an encumbrance against real or
11
personal property or a security interest of any kind (including, without limitation,
any conditional sale or other title retention agreement or lease in the nature
thereof or any filing or agreement to file a financing statement as debtor under the
Uniform Commercial Code or any similar statute other than to reflect ownership by a
third party of property leased to the Company or any of its Subsidiaries under a
lease that is not in the nature of a conditional sale or title retention agreement).
(xi) adding a definition of “Moody’s” as follows:
“Moody’s” means Moody’s Investors Service, Inc.
(xii) adding a definition of “Net Amount of Rent” as follows:
“Net Amount of Rent” as to any lease for any period means the aggregate amount of
rent payable by the lessee with respect to such period after excluding amounts
required to be paid on account of maintenance and repairs, insurance, taxes,
assessments, water rates and similar charges. In the case of any lease that is
terminable by the lessee upon the payment of a penalty, such net amount shall also
include the amount of such penalty, but no rent shall be considered as payable under
such lease subsequent to the first date upon which it may be so terminated.
(xiii) adding a definition of “Net Working Capital” as follows:
“Net Working Capital” means (a) all current assets of the Company and its
Subsidiaries, less (b) all current liabilities of the Company and its Subsidiaries,
except current liabilities included in Indebtedness, in each case as set forth in
consolidated financial statements of the Company prepared in accordance with GAAP.
(xiv) adding a definition of “Non-Recourse Indebtedness” as follows:
“Non-Recourse Indebtedness” means Indebtedness or that portion of Indebtedness of
the Company incurred in connection with the acquisition by the Company of any
property and as to which:
(a) the holders of such Indebtedness agree in writing that they will look
solely to the property so acquired and securing such Indebtedness for payment on or
in respect of such Indebtedness and
(b) no default with respect to such Indebtedness would permit (after notice or
passage of time or both), according to the terms of any other Indebtedness of the
Company or a Subsidiary, any holder of such other Indebtedness to declare a default
under such other Indebtedness or cause the payment of such other Indebtedness to be
accelerated or payable prior to its stated maturity.
12
(xv) adding a definition of “Oil and Gas Business” as follows:
“Oil and Gas Business” means the business of exploiting, exploring for, developing,
acquiring, operating, producing, processing, gathering, marketing, storing, selling,
hedging, treating, swapping, refinancing and transporting hydrocarbon and other
related energy businesses.
(xvi) adding a definition of “Permitted Liens” as follows:
“Permitted Liens” means, with respect to any Person, (a) pledges or deposits by
such Person under worker’s compensation laws, unemployment insurance laws or
similar legislation, or good faith deposits in connection with bids, tenders,
contracts (other than for the payment of Indebtedness) or leases to which such
Person is a party, or deposits to secure public or statutory obligations of such
Person or deposits of cash or United States government bonds to secure performance,
surety or appeal bonds to which such Person is a party or which are otherwise
required of such Person, or deposits as security for contested taxes or import
duties or for the payment of rent or other obligations of like nature, in each case
Incurred in the ordinary course of business; (b) Liens imposed by law, such as
carriers’, warehousemen’s, laborers’, materialmen’s, landlords’, vendors’,
workmen’s, operators’, producers’ (including those arising pursuant to Article
9.343 of the Texas Uniform Commercial Code or other similar statutory provisions of
other states with respect to production purchased from others) and mechanics’
Liens, in each case for sums not yet due or being contested in good faith by
appropriate proceedings; (c) Liens for property taxes, assessments and other
governmental charges or levies not yet delinquent or subject to penalties for
non-payment or which are being contested in good faith by appropriate proceedings;
(d) minor survey exceptions, minor encumbrances, easements or reservations of or
with respect to, or rights of others for or with respect to, licenses,
rights-of-way, sewers, electric and other utility lines and usages, telegraph and
telephone lines, pipelines, surface use, operation of equipment, permits,
servitudes and other similar matters, or zoning or other restrictions as to the use
of real property or Liens incidental to the conduct of the business of such Person
or to the ownership of its properties which were not Incurred in connection with
Indebtedness and which do not in the aggregate materially adversely affect the
value of said properties or materially impair their use in the operation of the
business of such Person; (e) Liens existing on or provided for under the terms of
agreements existing on the date on which the Notes were originally issued; (f)
Liens on property or assets of, or any shares of stock of or secured debt of, any
Person at the time the Company or any of its Subsidiaries acquired the property or
the Person owning such property, including any acquisition by means of a merger or
consolidation with or into the Company or any of its Subsidiaries; (g) Liens
securing a Hedging Obligation so long as such Hedging Obligation is of the type
customarily entered into in connection with, and is entered into for the purpose
of, limiting risk; (h) Liens upon specific properties of the Company or any of its
Subsidiaries securing Indebtedness Incurred in the ordinary course of business to
provide all or part of the funds for
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the exploration, drilling or development of those properties; (i) Purchase Money
Liens and Liens securing Non-Recourse Indebtedness; provided, however, that the
related purchase money Indebtedness and Non-Recourse Indebtedness, as applicable,
shall not be secured by any property or assets of the Company or any Subsidiary
other than the property acquired by the Company with the proceeds of such purchase
money Indebtedness or Non-Recourse Indebtedness, as applicable; (j) Liens securing
only Indebtedness of a wholly owned Subsidiary of the Company to the Company or to
one or more wholly owned Subsidiaries of the Company; (k) Liens on any property to
secure bonds for the construction, installation or financing of pollution control
or abatement facilities or other forms of industrial revenue bond financing or
Indebtedness issued or Guaranteed by the United States, any state or any
department, agency or instrumentality thereof; (l) Government Contract Liens; (m)
Liens in respect of Production Payments and Reserve Sales; (n) Liens resulting from
the deposit of funds or evidences of Indebtedness in trust for the purpose of
defeasing Indebtedness of the Company or any of its Subsidiaries; (o) legal or
equitable encumbrances deemed to exist by reason of negative pledges or the
existence of any litigation or other legal proceeding and any related lis pendens
filing (excluding any attachment prior to judgment, judgment lien or attachment
lien in aid of execution on a judgment); (p) rights of a common owner of any
interest in property held by such Person; (q) farmout, carried working interest,
joint operating, unitization, royalty, overriding royalty, sales and similar
agreements relating to the exploration or development of, or production from, oil
and gas properties entered into the ordinary course of business; (r) any defects,
irregularities or deficiencies in title to easements, rights-of-way or other
properties which do not in the aggregate materially adversely affect the value of
such properties or materially impair their use in the operation of the business of
such Person; and (s) Liens to secure any refinancing, refunding, extension, renewal
or replacement (or successive refinancings, refundings, extensions, renewals or
replacements), as a whole, or in part, of any Indebtedness secured by any Lien
referred to in the foregoing clauses (e) through (m); provided, however, that (i)
such new Lien shall be limited to all or part of the same property that secured the
original Lien (plus improvements on such property) and (ii) the Indebtedness
secured by such Lien at such time is not increased to any amount greater than the
sum of (A) the outstanding principal amount or, if greater, committed amount of the
Indebtedness described under clauses (e) through (m) at the time the original Lien
became a Permitted Lien under the Indenture and (B) an amount necessary to pay any
fees and expenses, including premiums, related to such refinancing, refunding,
extension, renewal or replacement.
(xvii) adding a definition of “Principal Property” as follows:
“Principal Property” means any property owned or leased by the Company or any
Subsidiary, the gross book value of which exceeds one percent of Consolidated Net
Worth.
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(xviii) adding a definition of “Production Payments and Reserve Sales” as follows:
“Production Payments and Reserve Sales” means the grant or transfer by the Company
or a Subsidiary of the Company to any Person of a royalty, overriding royalty, net
profits interest, production payment (whether volumetric or dollar denominated),
partnership or other interest in oil and gas properties, reserves or the right to
receive all or a portion of the production or the proceeds from the sale of
production attributable to such properties, including any such grants or transfers
pursuant to incentive compensation programs on terms that are reasonably customary
in the Oil and Gas Business for geologists, geophysicists and other providers of
technical services to the Company or a Subsidiary of the Company.
(xix) adding a definition of “Purchase Money Lien” as follows:
“Purchase Money Lien” means a Lien on property securing Indebtedness Incurred by the
Company or any of its Subsidiaries to provide funds for all or any portion of the
cost of (i) acquiring such property incurred before, at the time of, or within six
months after the acquisition of such property or (ii) constructing, developing,
altering, expanding, improving or repairing such property or assets used in
connection with such property.
(xx) adding a definition of “Rating Agency” as follows:
“Rating Agency” means each of S&P and Moody’s, or if S&P or Moody’s or both shall
not make a rating on the Notes publicly available, a nationally recognized
statistical rating agency or agencies, as the case may be, selected by the Company
(as certified by a resolution of the Company’s board of directors) which shall be
substituted for S&P or Moody’s, or both, as the case may be.
(xxi) adding a definition of “Rating Decline” as follows:
“Rating Decline” means the rating of the Notes shall be decreased by one or more
gradations (including gradations within categories as well as between rating
categories) by each of the Rating Agencies, provided, however, if the rating of the
Notes by each of the Rating Agencies is Investment Grade, then “Rating Decline” will
mean the rating of the Notes shall be decreased by one or more gradations (including
gradations within categories as well as between rating categories) by each Rating
Agency so that the rating of the Notes by each of the Rating Agencies falls below
Investment Grade, on any date from the date of the public notice of an arrangement
that could result in a Change of Control until the end of the 30-day period
following public notice of the occurrence of the Change of Control (which 30-day
period shall be extended so long as the rating of the Notes is under publicly
announced consideration for possible downgrade by either of the Rating Agencies;
provided, that the other Rating Agency has either downgraded, or publicly announced
that it is considering downgrading, the Notes).
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(xxii) adding a definition of “Refinance” as follows:
“Refinance” means, in respect of any Indebtedness, to refinance, extend, renew,
refund, repay, prepay, redeem, defease or retire, or to issue other Indebtedness in
exchange or replacement for, such indebtedness. “Refinanced” and “Refinancing”
shall have correlative meanings.
(xxiii) adding a definition of “S&P” as follows:
“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc.
(xxiv) adding a definition of “Sale and Leaseback Transaction” as follows:
“Sale and Leaseback Transaction” means any arrangement with any Person pursuant to
which the Company or any Subsidiary leases any Principal Property that has been or
is to be sold or transferred by the Company or the Subsidiary to such Person, other
than (i) temporary leases for a term, including renewals at the option of the
lessee, of not more than five years, (ii) leases between the Company and a
Subsidiary or between Subsidiaries, (iii) leases of 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 (iv) arrangements pursuant to any provision
of law with an effect similar to the former Section 168(f)(8) of the Internal
Revenue Code of 1954.
(xxv) deleting the definition of “Subsidiary” and substituting therefore the definition that
follows:
“Subsidiary” of any Person means (i) any Person of which more than 50% of the total
voting power of shares of Capital Stock entitled (without regard to the occurrence
of any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by any Person or
one or more of the Subsidiaries of that Person or a combination thereof, and (ii)
any partnership, joint venture or other Person in which such Person or one or more
of the Subsidiaries of that Person or a combination thereof has the power to control
by contract or otherwise the board of directors or equivalent governing body or
otherwise controls such entity; provided, however, that notwithstanding the
foregoing, with respect to the Company and its Subsidiaries, the definition of
Subsidiary shall not include Pioneer Southwest Energy Partners L.P. or any
Subsidiary of Pioneer Southwest Energy Partners L.P.
(xxvi) adding a definition of “Underwriters” as follows:
“Underwriters” has the meaning given such term in the Underwriting Agreement, dated
November 9, 2009, among the Company, and Deutsche Bank Securities Inc., J.P. Morgan
Securities Inc. and Wells Fargo Securities LLC, acting on behalf
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of the several underwriters named therein, and Credit Suisse Securities (USA) LLC,
as qualified independent underwriter.
(xxvii) adding a definition of “Volumetric Production Payments” as follows:
“Volumetric Production Payments” means production payment obligations recorded as
deferred revenue in accordance with GAAP, together with all undertakings and
obligations in connection therewith.
(xxviii) adding a definition of “Voting Stock” as follows:
“Voting Stock” of any person means all classes of capital stock or other interests
(including partnership interests) of such person then outstanding and normally
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees thereof.
(b)
Section 2.07
. Section 2.07 is hereby amended, solely with respect to the Notes,
by adding “the Underwriters,” before “the Company” in the last sentence of Section 2.07.
(c)
Section 2.15
. Section 2.15 is hereby amended, solely with respect to the Notes,
by adding “the Underwriters,” before “the Company” in the third sentence of subclause (v) of
Section 2.15(c).
Section 7.
Ratification
. This Supplemental Indenture is executed and shall be
construed as an indenture supplemental to the Indenture and, as provided in the Indenture, this
Supplemental Indenture forms a part of the Indenture. Except to the extent amended by or
supplemented by this Supplemental Indenture, the Company, the Guarantor and the Trustee hereby
ratify, confirm and reaffirm the Indenture in all respects.
Section 8.
No Security Interest Created
. Nothing in this Supplemental Indenture or in
the Notes, expressed or implied, shall be construed to constitute a security interest under the
Uniform Commercial Code or similar legislation, as now or hereafter enacted and in effect, in any
jurisdiction.
Section 9.
Table of Contents, Headings, Etc.
The table of contents and the titles and
headings of the sections of this Supplemental Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way modify or restrict any
of the terms or provisions hereof.
Section 10.
Severability
. In the event any provision of this Supplemental Indenture
or in the Notes shall be invalid, illegal or unenforceable, then (to the extent permitted by law)
the validity, legality or enforceability of the remaining provisions shall not in any way be
affected or impaired.
Section 11.
Counterparts
. This Supplemental Indenture may be executed in any number
of counterparts, each of which so executed shall be an original, but all such counterparts shall
together constitute but one and the same instrument. This Supplemental Indenture may be executed
by facsimile or other electronic transmission.
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Section 12.
Governing Law
. The laws of the State of New York shall govern the
construction and interpretation of this Supplemental Indenture, without regard to principles of
conflicts of laws.
Section 13.
Trustee Not Responsible for Recitals or Issuance of Notes
. The recitals
contained herein and in the Notes, except the Trustee’s certificates of authentication, shall be
taken as the statements of the Company, and the Trustee assumes no responsibility for their
correctness. The Trustee makes no representations as to the validity or sufficiency of this
Supplemental Indenture or of the Notes. The Trustee shall not be accountable for the use or
application by the Company of Notes or the proceeds thereof.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be signed on
their behalf by their duly authorized representatives as of the date first above written:
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Pioneer Natural Resources Company
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By:
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/s/ Richard P. Dealy
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Name:
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Richard P. Dealy
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Title:
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Executive Vice President, and
Chief Financial Officer
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Pioneer Natural Resources USA, Inc.
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By:
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/s/ Richard P. Dealy
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Name:
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Richard P. Dealy
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Title:
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Executive Vice President, and
Chief Financial Officer
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Wells Fargo Bank, National Association,
as Trustee
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By:
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/s/ John C. Stohlmann
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Name:
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John C. Stohlmann
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Title:
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Vice President
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S
IGNATURE
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AGE
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ECOND
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UPPLEMENTAL
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NDENTURE
