-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, IzWCkX3zCZ+GlOtAuyT82UjSNKzRSuEMeDQ623Lo4h66draXOrjPt/qcOXJN5gIc u0apB5p47F/v072dZDlCSw== 0000950129-94-000327.txt : 19940429 0000950129-94-000327.hdr.sgml : 19940429 ACCESSION NUMBER: 0000950129-94-000327 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 19940331 FILED AS OF DATE: 19940428 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BURLINGTON RESOURCES INC CENTRAL INDEX KEY: 0000833320 STANDARD INDUSTRIAL CLASSIFICATION: 1311 IRS NUMBER: 911413284 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-09971 FILM NUMBER: 94524861 BUSINESS ADDRESS: STREET 1: 5051 WESTHEIMER STREET 2: SUITE 1400 CITY: HOUSTON STATE: TX ZIP: 77056 BUSINESS PHONE: (713) 831-1600 MAIL ADDRESS: STREET 1: 999 THIRD AVENUE CITY: SEATTLE STATE: WA ZIP: 98104-4097 10-Q 1 FORM 10-Q FOR PERIOD ENDED 3/31/94 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended MARCH 31, 1994 OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 1-9971 BURLINGTON RESOURCES INC. (Exact name of registrant as specified in its charter) Delaware 91-1413284 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 5051 Westheimer, Houston, Texas 77056 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (713) 831-1600 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes X No ----------- ----------- Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Class Outstanding ----- ----------- Common Stock, par value $.01 per share as of March 31, 1994 129,716,665 2 PART I - FINANCIAL INFORMATION ITEM 1. Financial Statements BURLINGTON RESOURCES INC. CONSOLIDATED STATEMENT OF INCOME (UNAUDITED) FIRST QUARTER -------------------- 1994 1993 -------- -------- (In Thousands, Except Share Amounts) Revenues....................................... $320,323 $316,466 Costs and Expenses............................. 251,144 250,083 -------- -------- Operating Income............................... 69,179 66,383 Interest Expense............................... 18,056 19,801 Other Income (Expense) - Net................... (2,280) 45 -------- -------- Income from Continuing Operations Before Income Taxes......................... 48,843 46,627 Provision for Income Taxes..................... 1,123 1,399 -------- -------- Income from Continuing Operations.............. 47,720 45,228 Income from Discontinued Operations - Net of Income Taxes........................ - 633 -------- -------- Net Income..................................... $ 47,720 $ 45,861 ======== ======== Earnings per Common share: Continuing Operations......................... $ 0.37 $ 0.35 Discontinued Operations....................... - - -------- -------- Total......................................... $ 0.37 $ 0.35 ======== ======== See Accompanying Notes to Consolidated Financial Statements. - 2 - 3 BURLINGTON RESOURCES INC. CONSOLIDATED BALANCE SHEET (UNAUDITED)
March 31, December 31, 1994 1993 -------- ----------- (In Thousands) ASSETS Current Assets: Cash and Short-term Investments ................................ $ 18,032 $ 19,784 Accounts Receivable ............................................ 221,631 218,361 Inventories .................................................... 25,419 23,954 Other Current Assets ........................................... 22,001 14,572 ----------- ----------- 287,083 276,671 ----------- ----------- Oil & Gas Properties (Successful Efforts Method) ................ 5,132,523 5,027,312 Other Properties ................................................ 534,356 540,342 ----------- ----------- 5,666,879 5,567,654 Accumulated Depreciation, Depletion and Amortization ........... 1,694,147 1,631,941 ----------- ----------- Properties - Net .............................................. 3,972,732 3,935,713 ----------- ----------- Other Assets .................................................... 209,604 235,336 ----------- ----------- Total Assets ................................................. $ 4,469,419 $ 4,447,720 =========== =========== LIABILITIES Current Liabilities: Accounts Payable ............................................... $ 204,179 $ 202,565 Taxes Payable .................................................. 73,060 58,372 Other Current Liabilities ...................................... 24,363 38,680 ----------- ----------- 301,602 299,617 ----------- ----------- Long-term Debt .................................................. 816,542 819,071 ----------- ----------- Deferred Income Taxes ........................................... 556,459 566,758 ----------- ----------- Other Liabilities and Deferred Credits .......................... 155,632 154,216 ----------- ----------- Commitments and Contingent Liabilities STOCKHOLDERS' EQUITY Common Stock, Par Value, $ .01 Per Share (Authorized 325,000,000 Shares; Issued 150,000,000 Shares) ..... 1,500 1,500 Paid-in Capital ................................................. 2,936,819 2,936,934 Retained Earnings ............................................... 497,553 467,667 ----------- ----------- 3,435,872 3,406,101 Cost of Treasury Stock (1994, 20,283,335 Shares; 1993, 20,316,521 Shares) ............. 796,688 798,043 ----------- ----------- Common Stockholders' Equity ..................................... 2,639,184 2,608,058 ----------- ----------- Total Liabilities and Common Stockholders' Equity ............ $ 4,469,419 $ 4,447,720 =========== ===========
See Accompanying Notes to Consolidated Financial Statements. - 3 - 4 BURLINGTON RESOURCES INC. CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
THREE MONTHS ------------------------------ 1994 1993 -------- -------- (In Thousands) Cash Flows From Continuing Operating Activities: Income from Continuing Operations......................... $ 47,720 $ 45,228 Adjustments to Reconcile Income to Net Cash Provided By Continuing Operating Activities: Depreciation, Depletion and Amortization................. 74,888 71,227 Deferred Income Taxes.................................... (10,306) (10,431) Exploration Costs........................................ 7,518 4,827 Working Capital Changes: Accounts Receivable..................................... (3,270) 15,701 Inventories............................................. (1,465) 2,797 Other Current Assets.................................... (7,429) 67,866 Accounts Payable........................................ 1,614 (4,125) Taxes Payable........................................... 14,688 (6,481) Other Current Liabilities............................... (14,317) (24,289) Other.................................................... 35,411 (28,963) -------- -------- Net Cash Provided By Continuing Operating Activities. 145,052 133,357 -------- -------- Cash Flows From Continuing Investing Activities: Additions to Properties................................... (125,955) (82,202) Other..................................................... 2,029 49,504 -------- -------- Net Cash Used In Continuing Investing Activities..... (123,926) (32,698) -------- -------- Cash Flows From Continuing Financing Activities: Reduction in Long-term Debt............................... (2,575) (67,872) Dividends Paid............................................ (17,919) (16,144) Treasury Stock Transactions - Net......................... 1,696 32,041 Other..................................................... (11,891) (18,691) -------- -------- Net Cash Used In Continuing Financing Activities..... (30,689) (70,666) -------- -------- Increase (Decrease) in Cash and Short-term Investments From Continuing Operations................................ (9,563) 29,993 Cash Provided By (Used In) Discontinued Operations......... 7,811 (10,876) Cash and Short-term Investments: Beginning of Year......................................... 19,784 31,729 -------- -------- End of Period............................................. $ 18,032 $ 50,846 ======== ========
See Accompanying Notes to Consolidated Financial Statements. - 4 - 5 BURLINGTON RESOURCES INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 1. BASIS OF PRESENTATION The 1993 Annual Report on Form 10-K of Burlington Resources Inc. (the "Company") includes a summary of significant accounting policies and should be read in conjunction with this Form 10-Q. The statements for the periods presented herein are unaudited, condensed and do not contain all information required by generally accepted accounting principles to be included in a full set of financial statements. In the opinion of management, all material adjustments necessary to present fairly the results of operations have been included. All such adjustments are of a normal, recurring nature. The results of operations for any interim period are not necessarily indicative of the results of operations for the entire year. Earnings per common share is based on the weighted average number of common shares outstanding on a year to date basis. The weighted average number of common shares outstanding was 131 million and 130 million for the first three months of 1994 and 1993, respectively. 2. SUBSEQUENT EVENT On April 26, 1994, the Company acquired Maxus Energy Corporation's ("Maxus") 87.1 percent interest in Diamond Shamrock Offshore Partners Limited Partnership (the "Partnership"), including the general partner's interests in the Partnership. The Company also announced its intention to acquire the remaining 12.9 percent of the Partnership in a transaction expected to close in July 1994. In a separate transaction, the Company purchased an additional offshore property and one onshore property from Maxus. The aggregate net purchase price, including the remaining 12.9 percent of the Partnership, is $375 million. The proved and probable reserves acquired by the Company are approximately 375 BCFE of natural gas, located on approximately 100,000 developed and 200,000 undeveloped acres. The acquired properties currently produce approximately 95 MMCF per day of natural gas and 4 thousand barrels of oil per day from 49 structures of which approximately 50 percent are operated by the Partnership or Maxus. - 5 - 6 ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Financial Condition and Liquidity The total long-term debt to capital (total long-term debt and stockholders' equity) ratio at March 31, 1994, and December 31, 1993, was 24 percent. The Company has a $900 million revolving credit facility that expires in June 1996. As of March 31, 1994, there were no borrowings outstanding under this credit facility although borrowing capacity is reduced by outstanding commercial paper. At March 31, 1994, the Company had outstanding commercial paper borrowings of $68 million at an average interest rate of 3.45 percent. In April 1994, the Company anticipates issuing $300 million of debt securities under a shelf registration statement filed with the Securities and Exchange Commission. The net proceeds will be used for general corporate purposes, including acquisition of oil and gas properties, repayment of commercial paper and other capital expenditures. Upon issuing these debt securities, the Company will have $200 million of capacity remaining under the shelf registration statement. If $300 million of debt securities had been issued at March 31, 1994, the Company's total long-term debt to capital ratio would have been 30 percent. Net cash provided by continuing operating activities for the first three months of 1994 was $145 million compared to $133 million for the first three months of 1993. The increase is primarily due to higher operating income and lower interest payments. The Company is involved in certain environmental proceedings and other related matters. Although it is possible that new information or future developments could require the Company to reassess its potential exposure related to these matters, the Company believes, based upon available information, the resolution of these issues will not have a materially adverse effect on the consolidated financial position or results of operations of the Company. Capital Expenditures Capital expenditures during the first three months of 1994 totaled $126 million compared to $82 million for the first three months of 1993. On April 26, 1994, the Company acquired Maxus Energy Corporation's ("Maxus") 87.1 percent interest in Diamond Shamrock Offshore Partners Limited Partnership (the "Partnership"), including the general partner's interests in the Partnership. The Company also announced its intention to acquire the remaining 12.9 percent of the Partnership in a transaction expected to close in July 1994. In a separate transaction, the Company purchased an additional offshore property and one onshore property from Maxus. The aggregate net purchase price, including the remaining 12.9 percent of the Partnership, is $375 million. - 6 - 7 The proved and probable reserves acquired by the Company are approximately 375 BCFE of natural gas. The acquired properties currently produce approximately 95 MMCF per day of natural gas and 4 thousand barrels of oil per day. The natural gas and oil are produced from 49 structures of which approximately 50 percent are operated by the Partnership or Maxus. Capital expenditures for 1994, including $375 million for the Maxus acquisition and the remaining Partnership interest, are projected to be approximately $845 million and will consist primarily of reserve acquisitions, spending for development of oil and gas properties and processing plant and pipeline expenditures. Capital expenditures will be funded from internal cash flow supplemented, as needed, by external financing. Dividends On April 7, 1994, the Board of Directors declared a common stock quarterly dividend of $0.1375 per share, payable July 1, 1994. Results of Continuing Operations - First Quarter 1994 Compared to First Quarter 1993 Income from Continuing Operations for the first quarter of 1994 was $48 million, $0.37 per share, compared to $45 million, $0.35 per share, in 1993. Operating income increased to $69 million compared to $66 million in 1993. Revenues were $320 million for the first quarter of 1994 compared to $316 million in 1993. Average natural gas sales prices increased 13 percent in 1994 to an average of $1.79 per MCF which increased revenues $18 million. Gas sales volumes improved 9 percent to 998 MMCF per day which increased revenues $12 million. Gas sales volumes increased primarily due to continued development of the Company's oil and gas properties and producing property acquisitions. Intrastate natural gas sales increased $6 million primarily due to higher sales volumes and prices. Processing and transportation revenues increased $5 million. The revenue increases were partially offset by a $23 million decrease in NGL revenues primarily due to lower sales volumes and prices along with a 23 percent decline in 1994 oil prices to $13.89 per barrel which decreased revenues $16 million. Costs and expenses were $251 million in 1994 compared to $250 million in 1993. The increase was primarily due to a 9 percent improvement in 1994 production levels which increased production and processing related expenses $13 million. Intrastate natural gas and NGL product purchases decreased $15 million. - 7 - 8 PART II - OTHER INFORMATION ITEM 4. Submission of Matters to a Vote of Security Holders The Annual Meeting of Stockholders was held on March 17, 1994. The following were nominated and elected to serve as Directors of Burlington Resources Inc. for a term of one year or until their successors shall have been duly elected and qualified:
Nominee For Withheld ------- --- -------- J. V. Byrne 103,786,166 606,077 S. P. Gilbert 103,779,189 613,054 J. F. McDonald 103,859,670 532,573 T. H. O'Leary 103,843,561 548,682 D. M. Roberts 103,858,586 533,657 W. Scott, Jr. 103,840,307 551,936 W. E. Wall 103,731,631 660,612
The Burlington Resources Inc. 1993 Stock Incentive Plan was presented and adopted in accordance with the following vote:
Broker For Against Abstain Non-votes --- ------- ------- --------- 76,586,097 15,425,703 807,046 11,573,397
A stockholder proposal was not voted upon at the Annual Meeting because the proponent was not present to present the proposal. ITEM 6. Exhibits and Reports on Form 8-K A. Exhibits The following exhibits are filed as part of this report. Exhibits incorporated by reference are designated with an asterisk. Exhibit Nature of Exhibit ------- ----------------- 4.1 The Company and its subsidiaries either have filed with the Securities and Exchange Commission or upon request will furnish a copy of any instrument with respect to long-term debt of the Company. - 8 - 9 Exhibit Nature of Exhibit ------- ----------------- 11.1 Earnings per share computation. 12.1 Ratio of Earnings to Fixed Charges. 99.1 Form of Underwriting Agreement relating to certain securities to be offered pursuant to Registration Statements on Form S-3 No. 33-47154 and 33-50077. 99.2 Opinion of Andrews & Kurth L.L.P. relating to certain securities to be offered pursuant to Registration Statements on Form S-3 No. 33-47154 and 33-50077. 99.3 Consent of Andrews & Kurth L.L.P. regarding use of opinion in Registration Statements on Form S-3 No. 33-47154 and 33-50077 (included in Exhibit 99.2). B. Reports on Form 8-K During the quarter covered by this report there were no reports filed on Form 8-K. Items 1, 2, 3, and 5 of Part II are not applicable and have been omitted. - 9 - 10 Pursuant to the requirements of Section 13 (or 15(d)) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. BURLINGTON RESOURCES INC. (Registrant) By /s/ JOHN E. HAGALE John E. Hagale Senior Vice President and Chief Financial Officer By /s/ HAYS R. WARDEN Hays R. Warden Vice President & Controller Date: April 28, 1994 - 10 - EX-11.1 2 EARNINGS PER SHARE COMPUTATION 1 BURLINGTON RESOURCES INC. EARNINGS PER SHARE COMPUTATION EXHIBIT 11.1 (UNAUDITED)
FIRST QUARTER ----------------------------------------------- 1994 1993 ---------------------- --------------------- Earnings Shares Earnings Shares -------- ------- -------- ------- (In Thousands, Except per Share Amounts) Primary earnings per common share: Net earnings available for common stock and weighted average number of common shares outstanding.............................................. $ 47,720 129,707 $ 45,861 129,087 Stock options assumed exercised-net............................... - 812 - 1,226 -------- ------- -------- ------- Total net earnings and primary common shares...................... $ 47,720 130,519 $ 45,861 130,313 ======== ======= ======== ======= Primary earnings per common share................................. $ 0.37 $ 0.35 ======== ======== Fully diluted earnings per common share: Net earnings available for common stock and weighted average number of common shares outstanding.............................................. $ 47,720 129,707 $ 45,861 129,087 Stock options assumed excercised-net.............................. - 812 - 1,431 -------- ------- -------- ------- Total net earnings and fully diluted common shares................ $ 47,720 130,519 $ 45,861 130,518 ======== ======= ======== ======= Fully diluted earnings per common share........................... $ 0.37 $ 0.35 ======== ========
EX-12.1 3 RATIO OF EARNINGS TO FIXED CHARGES 1 BURLINGTON RESOURCES INC. RATIO OF EARNINGS TO FIXED CHARGES EXHIBIT 12.1 (UNAUDITED)
Three Months Ended March 31, ------------------------ 1994 1993 -------- ------ (In Thousands, Except Ratio Amounts) Earnings: Income from Continuing Operations Before Income Taxes........................................ $ 48,843 46,627 Add: Interest and fixed charges................................. 18,056 19,801 Portion of rent under long-term operating leases representative of an interest factor.............. 1,123 1,180 -------- ------ Total Earnings Available for Fixed Charges................... $ 68,022 67,608 ======== ====== Fixed Charges: Interest and fixed charges................................... $ 18,056 19,801 Portion of rent under long-term operating leases representative of an interest factor................ 1,123 1,180 Capitalized interest......................................... 345 780 -------- ------ Total Fixed Charges.......................................... $ 19,524 21,761 ======== ====== Ratio of Earnings to Fixed Charges............................. 3.48 x 3.11 x ======== ======
EX-99.1 4 FORM OF UNDERWRITING AGREEMENT 1 UNDERWRITING AGREEMENT April , 1994 Burlington Resources Inc. 5051 Westheimer (Suite 1400) Houston, Texas 77056 Dear Sirs: We (the "Manager" or the "Underwriter") understand that Burlington Resources Inc., a Delaware corporation (the "Company"), proposes to issue and sell $300,000,000 aggregate principal amount of % Notes Due 1999 (the "Debt Securities"). The Debt Securities are also referred to herein as the "Offered Securities". The Debt Securities will be issued pursuant to the provisions of an Indenture dated as of April 1, 1992 (the "Indenture"), between the Company and Citibank, N.A., as Trustee (the "Trustee"). Subject to the terms and conditions set forth or incorporated by reference herein, the Company hereby agrees to sell and we agree to purchase the respective principal amounts of Debt Securities set forth above at a purchase price equal to % of the principal amount of the Debt Securities, plus, in each case, accrued interest, if any, from May 1, 1994, to the date of payment and delivery. We will pay for the Offered Securities upon delivery thereof at the offices of Cravath, Swaine & Moore, Worldwide Plaza, 825 Eighth Avenue, New York, New York 10019 at 10:00 a.m. (New York time) on May , 1994, or at such other time, not later than 5:00 p.m. (New York time) on May , 1994, as shall be designated by us. The time and date of such payment and delivery are hereinafter referred to as the Closing Date. The Offered Securities shall have the terms set forth in the Prospectus dated April , 1994, and the 2 2 Prospectus Supplement dated April , 1994, including the following: Maturity Date: May 1, 1999 Interest Rate: % Redemption Provisions: None Interest Payment Dates: Each May 1 and November 1, commencing November 1, 1994 Form and Denomination: Registered form only in denominations of $1,000 and integral multiples thereof Other Terms: None All provisions contained in the document entitled Burlington Resources Inc. Underwriting Agreement Standard Provisions (Debt Securities) dated April , 1994, a copy of which is attached hereto, are herein incorporated by reference in their entirety and shall be deemed to be a part of this Agreement to the same extent as if such provisions had been set forth in full herein, except that if any term defined in such document is otherwise defined herein, the definition set forth herein shall control. For all purposes of the Standard Provisions, Morgan Stanley & Co. Incorporated is serving as sole Manager and Underwriter, and all notices shall be given to it at 1251 Avenue of the Americas, New York, New York 10020. Please confirm your agreement by having an authorized officer sign a copy of this Agreement in the space set forth below. Very truly yours, MORGAN STANLEY & CO. INCORPORATED By: _________________________________ Name: Title: 3 3 Accepted: BURLINGTON RESOURCES INC. By: ____________________________ Name: Title: 4 BURLINGTON RESOURCES INC. UNDERWRITING AGREEMENT STANDARD PROVISIONS (DEBT SECURITIES) April , 1994 From time to time, Burlington Resources Inc., a Delaware corporation (the "Company"), may enter into one or more underwriting agreements that provide for the sale of designated securities to the several underwriters named therein. The standard provisions set forth herein may be incorporated by reference in any such underwriting agreement (an "Underwriting Agreement"). The Underwriting Agreement, including the provisions incorporated therein by reference, is herein referred to as "this Agreement". Terms defined in the Underwriting Agreement are used herein as therein defined. The Company has filed with the Securities and Exchange Commission (the "Commission") a registration statement, including a prospectus, relating to the Debt Securities and has filed with, or transmitted for filing to, or will file with the Commission a prospectus supplement (the "Prospectus Supplement") specifically relating to the Offered Securities pursuant to and in accordance with Rule 424 under the Securities Act of 1933, as amended (the "Securities Act"). The term "Registration Statement" means the registration statement, including the exhibits thereto, as amended to the date of this Agreement. The term "Basic Prospectus" means the prospectus included in the Registration Statement. The term "Prospectus" means the Basic Prospectus together with the Prospectus Supplement. The term "preliminary prospectus" means a preliminary prospectus supplement specifically relating to the Offered Securities, together with the Basic Prospectus. As used herein, the terms "Basic Prospectus", "Prospectus" and "preliminary prospectus" shall include in each case the documents, if any, incorporated by reference therein. The terms "supplement" and "amendment" or "amend" as used herein shall include all documents deemed to be incorporated by 5 2 reference in the Prospectus that are filed subsequent to the date of the Basic Prospectus by the Company with the Commission pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange Act"). 1. Representations and Warranties. The Company represents and warrants to each of the Underwriters that: (a) The Registration Statement has become effective; no stop order suspending the effectiveness of the Registration Statement is in effect, and no proceedings for such purpose are pending before or, to the best of the Company's knowledge, threatened by the Commission. (b)(i) Each document, if any, filed or to be filed pursuant to the Exchange Act and incorporated by reference in the Prospectus complied or will comply when so filed in all material respects with the Exchange Act and the applicable rules and regulations of the Commission thereunder; (ii) each part of the Registration Statement, when such part became effective, did not contain, and each such part, as amended or supplemented, if applicable, will not contain, any 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; (iii) the Registration Statement and the Prospectus comply, and, as amended or supplemented, if applicable, will comply, in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder; and (iv) the Prospectus does not contain and, as amended or supplemented, if applicable, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this Section 1(b) do not apply (A) to statements or omissions in the Registration Statement or the Prospectus based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through the Managers expressly for use therein or (B) to that part of the Registration Statement that constitutes the Statement of Eligibility and Qualification (Form T-1) under the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), of the Trustee. (c) The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware, has the corporate power and authority to 6 3 own its property and to conduct its business as described in the 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 Company and its subsidiaries, taken as a whole. (d) Each subsidiary of the Company has been duly incorporated, is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, has the corporate power and authority to own its property and to conduct its business as described in the 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 Company and its subsidiaries, taken as a whole. (e) This Agreement has been duly authorized, executed and delivered by the Company. (f) The Indenture has been duly qualified under the Trust Indenture Act and has been duly authorized, executed and delivered by the Company and is a valid and binding agreement of the Company, enforceable in accordance with its terms except as (i) the enforceability thereof may be limited by bankruptcy, insolvency or similar laws affecting creditors' rights generally and (ii) rights of acceleration and the availability of equitable remedies may be limited by equitable principles of general applicability. (g) The Offered Securities have been duly authorized and, when executed and authenticated in accordance with the provisions of the Indenture and delivered to and paid for by the Underwriters in accordance with the terms of the Underwriting Agreement, will be entitled to the benefits of the Indenture and will be valid and binding obligations of the Company, in each case enforceable in accordance with their respective terms except as (i) the enforceability thereof may be limited by bankruptcy, insolvency or similar laws affecting creditors' rights generally and (ii) rights of acceleration and the availability of equitable remedies may be limited by equitable principles of general applicability. 7 4 (h) The execution and delivery by the Company of, and the performance by the Company of its obligations under, this Agreement, the Indenture and the Offered Securities will not contravene any provision of applicable law or the certificate of incorporation or by-laws of the Company or any agreement or other instrument binding upon the Company or any of its subsidiaries or affiliates that is material to the Company and its subsidiaries, taken as a whole, or any judgment or decree of any governmental agency or court having jurisdiction over the Company or any subsidiary, and no consent, approval, authorization or order of or qualification with any governmental body or agency is required for the performance by the Company of its obligations under this Agreement, the Indenture or the Offered Securities, except such as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Offered Securities. (i) There has not occurred any material adverse change in, or any adverse development which materially affects, the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Prospectus. (j) All descriptions in the Registration Statement, preliminary prospectus and Prospectus of statutes, regulations, legal or governmental proceedings, contracts and other documents are accurate in all material respects and fairly present in all material respects the information required to be shown; and there are no legal or governmental proceedings pending or, to the best of the Company's knowledge, threatened to which the Company or any of its subsidiaries is a party or to which any of the properties of any of them is subject which are required to be described in the Registration Statement or the Prospectus or any amendments or supplements thereto and are not so described or any statutes, regulations, contracts or other documents that are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement that are not described or filed as required. (k) The Company is not, nor is it directly or indirectly controlled by or acting on behalf of any person which is, (i) an "investment company" within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations promulgated by the Commission there- 8 5 under or (ii) a "holding company" within the meaning of, or subject to regulation under, the Public Utility Holding Company Act of 1935, as amended, and the rules and regulations promulgated by the Commission thereunder. 2. Public Offering. The Company is advised by the Managers that the Underwriters propose to make a public offering of their respective portions of the Offered Securities as soon after this Agreement has been entered into as in the Managers' judgment is advisable. The terms of the public offering of the Offered Securities are set forth in the Prospectus. 3. Purchase and Delivery. Except as otherwise provided in this Section 3, payment for the Offered Securities shall be made by certified or official bank check or checks payable to the order of the Company in New York Clearing House funds at the time and place set forth in the Underwriting Agreement, upon delivery to the Managers for the respective accounts of the several Underwriters of the Offered Securities, registered in such names and in such denominations as the Managers shall request in writing not less than two full business days prior to the date of delivery, with any transfer taxes payable in connection with the transfer of the Offered Securities to the Underwriters duly paid. 4. Conditions to Closing. The several obligations of the Underwriters hereunder are subject to the following conditions: (a) Subsequent to the execution and delivery of the Underwriting Agreement and prior to the Closing Date, (i) there shall not have occurred any downgrading, nor shall any notice have been given of any intended or potential downgrading or of any review for a possible change that does not indicate the direction of the possible change, in the rating accorded any of the Company's securities by any "nationally recognized statistical rating organization", as such term is defined for purposes of Rule 436(g)(2) under the Securities Act; and (ii) there shall not have occurred any change, or any development involving a prospective 9 6 change, in the condition, financial or otherwise, or in the earnings, business or operations, of the Company and its subsidiaries, taken as a whole, from that set forth in the Prospectus that, in the judgment of the Managers, is material and adverse and that makes it, in the judgment of the Managers, impracticable to market the Offered Securities on the terms and in the manner contemplated in the Prospectus. (b) The Managers shall have received on the Closing Date a certificate, dated the Closing Date and signed by an executive officer of the Company, to the effect set forth in clause (a)(i) above and to the effect that the representations and warranties of the Company contained in this Agreement are true and correct as of the Closing Date and that the Company has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied on or before the Closing Date. The officer signing and delivering such certificate may rely upon the best of his knowledge as to proceedings threatened. (c) The Managers shall have received on the Closing Date (i) an opinion of Andrews & Kurth L.L.P., special counsel to the Company, addressing the matters set forth in paragraphs (i), (ii), (iv), (v), (vi), (vii), (viii), (ix) (items (a), (b) and (c)), (x), (xi) and (xii) of Exhibit A attached hereto, and (ii) an opinion of the Senior Vice President, Law or Vice President, Law of the Company, addressing the matters set forth in paragraphs (iii), (viii), (ix) (items (d) and (e)), (x), (xi) and (xii) of Exhibit A. (d) The Managers shall have received on the Closing Date an opinion of Cravath, Swaine & Moore, special counsel for the Underwriters, dated the Closing Date, to the effect set forth in Exhibit B. (e) The Managers shall have received on each of the date hereof and the Closing Date a letter, dated such date, in form and substance reasonably satisfactory to the Managers, from Coopers & Lybrand, independent accountants for the Company, containing statements and information of the type ordinarily included in accountants' "comfort letters" with respect 10 7 to the financial statements and certain financial information contained in or incorporated by reference into the Prospectus. 5. Covenants of the Company. In further consideration of the agreements of the Underwriters contained herein, the Company covenants as follows: (a) To furnish the Managers, without charge, a signed copy of the Registration Statement (including exhibits thereto) and for delivery to each other Underwriter a conformed copy of the Registration Statement (without exhibits thereto) and, during the period mentioned in paragraph (c) below, as many copies of the Prospectus, any documents incorporated by reference therein and any supplements and amendments thereto or to the Registration Statement as the Managers may reasonably request. (b) Before amending or supplementing the Registration Statement or the Prospectus with respect to the Offered Securities, to furnish to the Managers a copy of each such proposed amendment or supplement and not to file any such proposed amendment or supplement to which the Managers reasonably object. (c) If, during such period after the first date of the public offering of the Offered Securities as in the opinion of counsel for the Underwriters the Prospectus is required by law to be delivered in connection with sales by an Underwriter or dealer, any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances when the Prospectus is delivered to a purchaser, not misleading, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Prospectus to comply with law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters, and to the dealers (whose names and addresses the Managers will furnish to the Company) to which Offered Securities may have been sold by the Managers on behalf of the Underwriters and to any other dealer upon request, either amendments or supplements to the Prospectus so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances when the Prospectus is delivered to a 11 8 purchaser, be misleading or so that the Prospectus, as so amended or supplemented, will comply with law. (d) To endeavor to qualify the Offered Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions as the Managers shall reasonably request and to pay all expenses (including fees and disbursements of counsel) in connection with such qualification and in connection with (i) the determination of the eligibility of the Offered Securities for investment under the laws of such jurisdictions as the Managers may designate and (ii) any review of the offering of the Offered Securities by the National Association of Securities Dealers, Inc. (e) To make generally available to the Company's security holders and to the Managers as soon as practicable an earnings statement covering a twelve month period beginning on the first day of the first full fiscal quarter after the date of this Agreement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder. (f) During the period beginning on the date of the Underwriting Agreement and continuing to and including the Closing Date, not to offer, sell, contract to sell or otherwise dispose of any debt securities of the Company substantially similar to the Offered Securities (other than the Offered Securities) without the prior written consent of the Managers. 6. Indemnification and Contribution. The Company agrees to indemnify and hold harmless each Underwriter and each person, if any, who controls such Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred by any Underwriter or any such controlling person in connection with defending or investigating any such action or claim) caused by any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus or the Prospectus (as amended or supplemented if the Company shall have furnished any amendments or supplements thereto), or caused by any omission or alleged omission to 12 9 state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages or liabilities are caused by any such untrue statement or omission or alleged untrue statement or omission based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through the Managers expressly for use therein. Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, its directors, its officers who sign the Registration Statement and each person, if any, who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the foregoing indemnity from the Company to such Underwriter, but only with reference to information relating to such Underwriter furnished to the Company by such Underwriter in writing through the Managers expressly for use in the Registration Statement, any preliminary prospectus, the Prospectus or any amendments or supplements thereto. In case any proceeding (including any governmental investigation) shall be instituted involving any person in respect of which indemnity may be sought pursuant to either of the two preceding paragraphs, such person (the "indemnified party") shall promptly notify the person against whom such indemnity may be sought (the "indemnifying party") in writing and the indemnifying party, upon request of the indemnified party, shall retain counsel reasonably satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the fees and disbursements of such counsel related to such proceeding. In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. It is understood that the indemnifying party shall not, in respect of the legal expenses of any indemnified party in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the fees and expenses of more 13 10 than one separate firm (in addition to any local counsel) for all such indemnified parties and that all such fees and expenses shall be reimbursed as they are incurred. Such firm shall be designated in writing by the Managers, in the case of parties indemnified pursuant to the second preceding paragraph, and by the Company, in the case of parties indemnified pursuant to the first preceding paragraph. The indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the third sentence of this paragraph, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding. If the indemnification provided for in the first or second paragraph in this Section 6 is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other hand from the offering of the Offered Securities or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not 14 11 only the relative benefits referred to in clause (i) above but also the relative fault of the Company on the one hand and of the Underwriters on the other hand in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other hand in connection with the offering of the Offered Securities shall be deemed to be in the same respective proportions as the net proceeds from the offering of such Offered Securities (before deducting expenses) received by the Company and the total underwriting discounts and commissions received by the Underwriters, in each case as set forth in the table on the cover of the Prospectus Supplement, bear to the aggregate public offering price of the Offered Securities. The relative fault of the Company on the one hand and of the Underwriters on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Underwriters and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Underwriters' respective obligations to contribute pursuant to this Section 6 are several in proportion to the respective principal amounts of Offered Securities purchased by each of such Underwriters and not joint. The Company and the Underwriters agree that it would not be just or equitable if contribution pursuant to this Section 6 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages and liabilities referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 6, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Offered Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages that such Underwriter has other- 15 12 wise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The remedies provided for in this Section 6 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity. The indemnity and contribution provisions contained in this Section 6 and the representations and warranties of the Company contained herein shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Underwriter or any person controlling any Underwriter or by or on behalf of the Company, its directors or officers or any person controlling the Company and (iii) acceptance of and payment for any of the Offered Securities. 7. Termination. This Agreement shall be subject to termination, by notice given by the Managers to the Company, if (a) after the execution and delivery of the Underwriting Agreement and prior to the Closing Date (i) trading generally shall have been suspended or materially limited on or by, as the case may be, any of the New York Stock Exchange, the American Stock Exchange or the National Association of Securities Dealers, Inc., (ii) trading of any securities of the Company shall have been suspended on any exchange or in any over-the-counter market, (iii) a general moratorium on commercial banking activities in New York shall have been declared by either Federal or New York State authorities, or (iv) there shall have occurred any outbreak or escalation of hostilities or any change in financial markets or any calamity or crisis that, in the judgment of the Managers, is material and adverse and (b) in the case of any of the events specified in clauses (a) (i) through (iv), such event, singly or together with any other such event, makes it, in the judgment of the Managers, impracticable to market the Offered Securities on the terms and in the manner contemplated in the Prospectus. 8. Defaulting Underwriters. [Applicable only if there is more than one Underwriter of the Offered Securities.] If, on the Closing Date, any one or more of the Underwriters shall fail or refuse to purchase Offered Securities of any series that it has or they have agreed to 16 13 purchase hereunder on such date, and the aggregate amount of Offered Securities of such series which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase is not more than one-tenth of the aggregate amount of the Offered Securities of such series to be purchased on such date, the other Underwriters shall be obligated severally in the proportions that the amount of Offered Securities of such series set forth opposite their respective names above bears to the aggregate amount of Offered Securities of such series set forth opposite the names of all such nondefaulting Underwriters, or in such other proportions as the Managers may specify, to purchase the Offered Securities which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase on such date; provided that in no event shall the amount of Offered Securities of any series that any Underwriter has agreed to purchase pursuant to this Agreement be increased pursuant to this Section 8 by an amount in excess of one-ninth of such amount of Offered Securities without the written consent of such Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Offered Securities of any series and the aggregate amount of Offered Securities with respect to which such default occurs is more than one-tenth of the aggregate amount of Offered Securities of such series to be purchased on such date, and arrangements satisfactory to the Managers and the Company for the purchase of such Offered Securities are not made within 36 hours after such default, this Agreement shall terminate with respect to such series of Offered Securities without liability on the part of any non-defaulting Underwriter or the Company. In any such case either the Manager or the Company shall have the right to postpone the Closing Date but in no event for longer than seven days, in order that the required changes, if any, in the Registration Statement and in the Prospectus or in any other documents or arrangements may be effected. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement. If this Agreement shall be terminated by the Underwriters, or any of them, because of any failure or refusal on the part of the Company to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason the Company shall be unable to perform its obligations under this Agreement, the Company will reimburse the Underwriters or such Underwriters as have so terminated this Agreement with respect to themselves, severally, for 17 14 all out-of-pocket expenses (including the fees and disbursements of their counsel) reasonably incurred by such Underwriters in connection with this Agreement or the offering of the Offered Securities. 9. Miscellaneous. The Underwriting Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto were upon the same instrument. This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York. 10. Headings. The headings of the sections of this Agreement have been inserted for convenience of reference only and shall not be deemed a part of this Agreement. 11. Notices. All references herein and in the Underwriting Agreement to the Managers when made in connection with any notice to or communication by or with such Managers shall, if there is more than one manager, be deemed to be to the Lead Manager, as designated in the Underwriting Agreement, and all notices shall be given to such Lead Manager at the address set forth therein. 18 Exhibit A Opinion of Counsel for the Company The opinion of counsel for the Company to be delivered pursuant to Section 4(c) of the Underwriting Agreement shall be to the effect that: (i) the Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware; (ii) the Company has the corporate power and authority to own its property and to conduct its business as described in the 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 Company and its subsidiaries, taken as a whole; (iii) each subsidiary of the Company has been duly incorporated, is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, has the corporate power and authority to own its property and to conduct its business as described in the 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 Company and its subsidiaries, taken as a whole; (iv) the Underwriting Agreement has been duly authorized, executed and delivered by the Company; (v) the Indenture has been duly qualified under the Trust Indenture Act and has been duly authorized, 19 2 executed and delivered by the Company and is a valid and binding agreement of the Company, enforceable in accordance with its terms except as (a) the enforceability thereof may be limited by bankruptcy, insolvency or similar laws affecting creditors' rights generally and (b) rights of acceleration and the availability of equitable remedies may be limited by equitable principles of general applicability; (vi) the Offered Securities have been duly authorized and, when executed and authenticated in accordance with the provisions of the Indenture and delivered to and paid for by the Underwriters in accordance with the terms of the Underwriting Agreement, will be entitled to the benefits of the Indenture and will be valid and binding obligations of the Company, in each case enforceable in accordance with their respective terms except as (a) the enforceability thereof may be limited by bankruptcy, insolvency or similar laws affecting creditors' rights generally and (b) rights of acceleration, if any, and the availability of equitable remedies may be limited by equitable principles of general applicability; (vii) the execution and delivery by the Company of, and the performance by the Company of its obligations under, the Underwriting Agreement, the Indenture and the Offered Securities will not contravene any provisions of applicable law or the certificate of incorporation or by-laws of the Company. (viii) the execution and delivery by the Company of, and the performance by the Company of its obligations under, the Underwriting Agreement, the Indenture and the Offered Securities will not contravene any agreement or other instrument binding upon the Company or any of its subsidiaries or affiliates that is material to the Company and its subsidiaries, taken as a whole, or any judgment, order or decree of any governmental body, agency or court of the United States or any jurisdiction therein or, to the best of such counsel's knowledge, any other jurisdiction having jurisdiction over the Company or any subsidiary, and no consent, approval, authorization or order of or qualification with any governmental body or agency is required for the performance by the Company of its obligations under the Underwriting Agreement, the Indenture or the Offered Securities except such as may 20 3 be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Offered Securities; (ix) the statements (a) in the Prospectus Supplement under the captions "Certain Terms of the Debt Securities" and "Underwriting", (b) in the Basic Prospectus under the captions "Description of Debt Securities" and "Plan of Distribution", (c) in the Registration Statement under Item 15, (d) in "Item 3 - Legal Proceedings" of the Company's most recent annual report on Form 10-K incorporated by reference in the Prospectus and (e) in "Item 1 - Legal Proceedings" of Part II of the Company's quarterly reports on Form 10-Q, if any, filed since such annual report, in each case insofar as such statements constitute summaries of the legal matters, documents or proceedings referred to therein, fairly present the information called for with respect to such legal matters, documents and proceedings and fairly summarize the matters referred to therein; (x) after due inquiry, such counsel does not know of any legal or governmental proceedings pending or threatened to which the Company or any of its subsidiaries is a party or to which any of the properties of the Company or any of its subsidiaries is subject that are required to be described in the Registration Statement or the Prospectus and are not so described or of any statutes, regulations, contracts or other documents that are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement that are not described or filed as required; (xi) the Company is not, nor is it directly or indirectly controlled by or acting on behalf of any person which is, (i) an "investment company" within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations promulgated by the Commission thereunder or (ii) a "holding company" within the meaning of, or subject to regulation under, the Public Utility Holding Company Act of 1935, as amended, and the rules and regulations promulgated by the Commission thereunder. (xii) such counsel (a) is of the opinion that each document, if any, filed pursuant to the Exchange Act 21 4 and incorporated by reference in the Prospectus (except for financial statements and schedules and other financial or statistical information included therein as to which such counsel need not express any opinion) complied when so filed as to form in all material respects with the Exchange Act and the applicable rules and regulations of the Commission thereunder, (b) believes that (except for financial statements and schedules and other financial or statistical information as to which such counsel need not express any belief and except for that part of the Registration Statement that constitutes the Form T-1 heretofore referred to) each part of the Registration Statement, when such part became effective, did not, and as of the date such opinion is delivered, does not contain any 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, (c) is of the opinion that the Registration Statement and Prospectus (except for financial statements and schedules and other financial or statistical information included therein as to which such counsel need not express any opinion) comply as to form in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder and (d) believes that (except for financial statements and schedules and other financial or statistical information as to which such counsel need not express any belief) the Prospectus as of the date such opinion is delivered does not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. With respect to paragraph (xii) above, such counsel may state that its opinion and belief are based upon its participation in the preparation of the Registration Statement and Prospectus and any amendments or supplements thereto and documents incorporated therein by reference and review and discussion of the contents thereof, but are without independent check or verification, except as specified. 22 Exhibit B Opinion of Cravath, Swaine & Moore, Counsel for the Underwriters The opinion of Cravath, Swaine & Moore, counsel for the Underwriters, to be delivered pursuant to Section 4(d) of the Underwriting Agreement shall be to the effect that: (i) the Underwriting Agreement has been duly authorized, executed and delivered by the Company; (ii) the Indenture has been duly authorized, executed and delivered, has been duly qualified under the Trust Indenture Act of 1939, as amended, and constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other laws affecting creditors' rights generally from time to time in effect and, as to the enforceability of obligations, to general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law; (iii) the Offered Securities have been duly authorized and, when executed and authenticated in accordance with the provisions of the Indenture and delivered to and paid for by the Underwriters in accordance with the terms of the Underwriting Agreement, will constitute legal, valid and binding obligations of the Company, entitled to the benefits of the Indenture, and conform to the description thereof contained in the Prospectus; (iv) the Registration Statement became effective under the Securities Act, and to the best knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been initiated or are pending or contemplated under the Securities Act; and 23 2 (v) such counsel (1) believes that (except for financial statements and related schedules and other financial data as to which such counsel need not express any belief and except for that part of the Registration Statement that constitutes the Form T-1 heretofore referred to) each part of the Registration Statement, when such part became effective, did not contain any 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, (2) is of the opinion that the Registration Statement and Prospectus (except for financial statements and related schedules and other financial data included therein as to which such counsel need not express any opinion) comply as to form in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder and (3) believes that (except for financial statements and related schedules and other financial data as to which such counsel need not express any belief) the Prospectus as of the date such opinion is delivered does not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. With respect to clause (v) above, such counsel may state that their opinion and belief are based upon their participation in the preparation of the Registration Statement and the Prospectus and any amendments or supplements thereto (other than the documents incorporated by reference) and upon review and discussion of the contents thereof (including documents incorporated by reference) but are without independent check or verification, except as specified. Such counsel may rely, to the extent its opinions are based upon matters governed by the laws of other jurisdictions, upon the opinion of other counsel admitted to the bar in such jurisdictions. EX-99.2 5 OPINION OF ANDREWS & KURTH 1 ANDREWS & KURTH L.L.P. ATTORNEYS OTHER OFFICES: TEXAS COMMERCE TOWER WASHINGTON, D.C. HOUSTON, TEXAS 77002 TELEPHONE: (713) 220-4200 DALLAS TELECOPIER: (713) 220-4285 LOS ANGELES TELEX: 79-1208 NEW YORK April 27, 1994 Burlington Resources Inc. 5051 Westheimer, Suite 1400 Houston, Texas 77056 Gentlemen: We have acted as special counsel to Burlington Resources Inc. (the "Company"), in connection with the Company's Registration Statements on Form S-3 (File Nos. 33-47154 and 33-50077) (collectively, the "Registration Statement") relating to registration under the Securities Act of 1933, as amended (the "Act"), of the offering and sale of up to $500,000,000 principal amount of the Company's Debt Securities. Capitalized terms used herein and not otherwise defined shall have the meanings assigned to them in the Registration Statement. The opinion set forth below is being delivered in connection with the offer and sale of $300,000,000 principal amount of Notes due 1999 (the "Notes") pursuant to Rule 415 under the Act pursuant to a Prospectus Supplement. As the basis for the opinion hereinafter expressed, we have examined such statutes, regulations, corporate records and documents, certificates of corporate and public officials and other instruments as we have deemed necessary or advisable for the purposes of this opinion. In such examination, we have assumed the authenticity of all documents submitted to us as originals and the conformity with the original documents of all documents submitted to us as copies. Based on the foregoing and on such legal considerations as we deem relevant, we are of the opinion that the Notes have been duly and validly authorized by all necessary corporate action by the Company, and assuming due execution and delivery of the Indenture, the due execution and authentication of the Notes as specified in the Indenture and delivery of the Notes against payment therefor, the Notes will constitute valid and legally binding obligations of the Company, subject to any applicable bankruptcy, insolvency, fraudulent transfer, reorganization, 2 ANDREWS & KURTH L.L.P. Burlington Resources Inc. Page Two moratorium and other laws of general applicability relating to or affecting creditors' rights and to general equitable principles. We hereby consent to the use of this opinion as an exhibit to the Registration Statement and to the use of our name under the heading "Legal Matters" in the Registration Statement. Very truly yours, /s/ ANDREWS AND KURTH L.L.P. -----END PRIVACY-ENHANCED MESSAGE-----