<PAGE>
As filed with the Securities and Exchange Commission on May 27, 1999.
Registration No. 333-
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- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
Form S-3
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
----------------
Vastar Resources, Inc.
(Exact name of registrant as specified in its charter)
Delaware 95-4446177
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
15375 Memorial Drive
Houston, Texas 77079
(281) 584-6155
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
----------------
ALBERT D. HOPPE, Esq.
Vice President, General Counsel and Secretary
Vastar Resources, Inc.
15375 Memorial Drive
Houston, Texas 77079
(281) 584-6027
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
----------------
Copies of Communications to:
JONATHAN D. EDELFELT, Esq. R. JOEL SWANSON, Esq.
Senior Counsel and Associate Secretary Baker & Botts, L.L.P.
Vastar Resources, Inc. 910 Louisiana
15375 Memorial Drive Houston, Texas 77002-4995
Houston, Texas 77079 (713) 229-1234
(281) 584-6155 ----------------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement as determined
by market conditions.
----------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, please check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
----------------
CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
Proposed Proposed
Title of each class of Amount maximum maximum Amount of
securities to be to be offering price aggregate registration
registered registered per unit(1)(2) offering price(1) fee
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt Securities......... $300,000,000(2) 100% $300,000,000 $83,400
- ---------------------------------------------------------------------------------------
</TABLE>
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(1) Estimated solely for purpose of computing the registration fee in
accordance with Rule 457(o) under the Securities Act of 1933.
(2) If any Debt Securities are issued at an original issue discount, the
amount to be registered shall be deemed to be increased so as to result in
an aggregate offering price of all Debt Securities equal to $300,000,000,
and the proposed maximum offering price per unit will be deemed to be
correspondingly decreased.
----------------
The registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this
registration statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until the registration statement
shall become effective on such date as the Commission, acting pursuant to said
Section 8(a), may determine.
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<PAGE>
SUBJECT TO COMPLETION, DATED MAY 27, 1999
PROSPECTUS
Vastar Resources, Inc.
15375 Memorial Drive
Houston, Texas 77079
(281) 584-6000
Debt Securities
[LOGO OF VASTAR RESOURCES APPEARS HERE]
This prospectus may
be used to offer and
sell debt securities
only if accompanied
by a prospectus
supplement.
The prospectus
supplement will
include the specific
terms of the
offering, the names
of the agents and
underwriters, if
any, the amount they
are to be paid and
the amount of net
proceeds to the
Company.
We may periodically issue debt securities on terms we determine based on
market conditions at the time of sale. The debt securities will be our general
unsecured obligations. We may issue debt securities in one or more series:
. in various amounts up to an aggregate of $300,000,000;
. with various maturity dates and interest payment dates;
. at fixed prices, at prevailing market prices or at negotiated prices;
. at par value, at a premium to par or with an original issue discount;
. for U.S. dollars or foreign currencies;
. represented by certificates or in book-entry form; and
. subject to redemption, exchange or conversion rights exercisable by the
holder or us.
The debt securities may be sold:
. directly to purchasers by us;
. through agents we select; or
. through underwriters acting alone or as part of an underwriting
syndicate.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or passed on the
adequacy or accuracy of this prospectus. Any representation to the contrary is
a criminal offense.
The information in this prospectus is not complete and may be changed. We
may not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an
offer to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
, 1999
<PAGE>
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
SEC utilizing a "shelf" registration process. Under this shelf process, we may
sell any combination of the securities described in this prospectus in one or
more offerings up to a total dollar amount of $300,000,000. This prospectus
provides you with a general description of the securities we may offer. Each
time we sell securities, we will provide a prospectus supplement that will
contain specific information about the terms of that offering. The prospectus
supplement may also add, update or change information contained in this
prospectus. You should read this prospectus and any prospectus supplement,
together with additional information we describe under the heading "Where You
Can Find More Information."
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. Our SEC filings are available to the public at the
SEC's web site at http://www.sec.gov. You may also read and copy any document
we file at the SEC's public reference rooms in Washington, D.C., New York, New
York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms.
The SEC allows us to "incorporate by reference" the information in documents
we file with them, which means that we can disclose important information to
you by referring you to those documents. The information we incorporated by
reference is an important part of this prospectus, and information that we file
later with the SEC will automatically update and supersede this information. We
incorporate by reference the following documents and any future filings we make
with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities
Exchange Act of 1934 until we sell all the securities (our file number with the
SEC is No. 1-13108):
. Annual Report on Form 10-K for the year ended December 31, 1998;
. Current Report on Form 8-K, dated March 29, 1999 and filed with the SEC
on March 29, 1999; and
. Quarterly Report on Form 10-Q for the quarter ended March 31, 1999.
You may request a copy of these filings at no cost, by writing or telephoning
us at the following address:
Jonathan D. Edelfelt, Associate Secretary, Vastar Resources, Inc., 15375
Memorial Drive, Houston, Texas 77079 (Telephone: (281) 584-6155).
You should rely only on the information we incorporate by reference or
provide in this prospectus or any prospectus supplement. We are not making an
offer of these debt securities in any state where the offer is not permitted.
You should not assume that the information in this prospectus or any supplement
is accurate as of any date other than the date on the front of those documents.
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<PAGE>
THE COMPANY
Vastar Resources, Inc. was incorporated in Delaware in September 1993 and is
one of the leading independent (nonintegrated) oil and gas exploration and
production companies in the United States. Our exploration and production
operations are concentrated in four premier producing regions of the United
States--the Gulf of Mexico, Gulf Coast, San Juan Basin and Mid-Continent. We
market substantially all of our natural gas through Southern Company Energy
Marketing L.P., a limited partnership in which we currently own a 40 percent
interest. We directly market our crude oil and natural gas liquids nationwide.
We primarily draw from an inventory of internally generated prospects in
order to find and develop reserves using, where appropriate, advanced
technology to reduce the risks associated with gas and oil exploration and
development. As of December 31, 1998, our proved reserves were approximately
3,700 billion cubic feet equivalent. We operate our business and report all our
operations as one business segment.
ARCO (Atlantic Richfield Company) owns 80,000,001 shares or 82.1% of our
outstanding Common Stock. For additional information relating to other
relationships between Vastar and ARCO, including potential conflicts of
interest, see Note 5 of the Notes to Consolidated Financial Statements and Item
13 in our Annual Report on Form 10-K for the year ended December 31, 1998.
3
<PAGE>
USE OF PROCEEDS
Unless we otherwise indicate in the accompanying prospectus supplement, we
will use the net proceeds from the sale of the debt securities for general
corporate purposes relating to our oil and gas exploration and production
business, including repayment of debt and loans to and investments in our
subsidiaries.
RATIO OF EARNINGS TO FIXED CHARGES
Our consolidated ratio of earnings to fixed charges for each period indicated
is as follows:
<TABLE>
<CAPTION>
Three Months
Ended
March 31, Twelve Months Ended December 31,
------------ -----------------------------------------------------------------------
1999 1998 1997 1996 1995 1994
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
0.75 1.81 5.91 5.07 1.99 3.32
</TABLE>
We compute the ratios of earnings to fixed charges by dividing our earnings
by our fixed charges. For this purpose, earnings include income before income
taxes and fixed charges. Fixed charges include interest, amortization of debt
expense and the estimated interest component of rentals. The ratio of earnings
to fixed charges for the quarter ended March 31, 1999 was less than one to one.
If our income before income taxes had been approximately $5.4 million higher
for the quarter ended March 31, 1999, the ratio of earnings to fixed charges
for that quarter would have been one to one.
4
<PAGE>
DESCRIPTION OF DEBT SECURITIES
The following description of the debt securities sets forth certain general
terms and provisions of the debt securities to which this prospectus and any
prospectus supplement may relate. The particular terms of any series of debt
securities and the extent to which the general provisions may apply will be
described in a prospectus supplement relating to that series.
We will issue the debt securities under the indenture dated as of January 1,
1995, and supplemented on May 18, 1995, and April 16, 1998, among Vastar,
Harris Trust and Savings Bank, as successor trustee and its affiliate, Bank of
Montreal Trust Company, as paying agent. In this prospectus we refer to these
documents as the "Indenture" and to Harris Trust and Savings Bank as the
"Trustee." This prospectus briefly outlines some of the Indenture provisions.
We have included italicized parenthetical references below which refer to the
article and section numbers in the Indenture so that you can easily locate
these provisions in the Indenture. If you would like more information on these
or other provisions of the Indenture, you may review the Indenture that we
filed with the SEC. See "Where You Can Find More Information" to obtain a copy
of the Indenture.
General. The Indenture (1) does not limit the aggregate principal amount of
debt securities that can be issued by us and (2) provides that we may
periodically issue debt securities in one or more series, in an aggregate
principal amount authorized by our board of directors prior to issuance. All
securities we issue under the Indenture will be our general unsecured
obligations. The Indenture does not limit the amount of other unsecured
indebtedness or securities that we may issue.
Unless we otherwise indicate in a prospectus supplement, the debt securities
will not benefit from any covenant or other provision that would afford holders
special protection in the event of a highly leveraged transaction involving
Vastar, except for any protection provided by the provisions described below
under "Limitation on Liens."
The prospectus supplement may contain the following terms with respect to
each series of debt securities:
. the title and aggregate principal amount of the debt securities of that
series;
. the date or dates on which the debt securities of that series will
mature;
. the rate or rates (which may be fixed or variable) per annum, if any, at
which the debt securities of that series will bear interest or the method
of determining the interest rate or rates;
. the date or dates from which interest, if any, will accrue and the date
or dates at which interest, if any, will be payable;
. the terms for redemption or early payment, if any, including any
mandatory or optional sinking fund or analogous provision;
. the terms for conversion or exchange, if any, of the debt securities of
that series;
. whether the debt securities will be issued in fully registered form or in
bearer form or any combination of these forms;
. whether those debt securities will be issued in the form of one or more
global securities and whether those global securities will be issued in
temporary global form or permanent global form;
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<PAGE>
. the currency, currencies or currency units in which the debt securities
of that series will be denominated and in which the principal of, and
premium and interest, if any, on those debt securities will be payable;
and
. any other specific terms of the debt securities of that series.
The prospectus supplement may contain information about additional covenants
that may be included in the terms of a series of debt securities. (Section 301)
No service charge will be made for any registration of transfer or exchange
of the debt securities, but we may require the holder to pay any applicable tax
or other governmental charge. (Section 305)
To the extent we conduct our operations through subsidiaries, the holders of
debt securities will have a junior position to any creditors of our
subsidiaries.
Debt securities of any series may be sold at a discount (which may be
substantial) below their stated principal amount bearing no interest or
interest at a rate which at the time of issuance is below market rates. Any
material United States federal income tax consequences and other special
considerations relating to debt securities will be described in the prospectus
supplement relating to the debt securities.
If debt securities of any series are sold for any foreign currency or
currency unit or if the principal of, or premium or interest, if any, on debt
securities of any series is payable in any foreign currency or currency unit,
the restrictions, elections, tax consequences, specific terms and other
information with respect to the series and the foreign currency or currency
unit will be set forth in the prospectus supplement relating to those debt
securities.
Limitation on Liens. The Indenture provides that, so long as any debt
securities issued under the Indenture are outstanding, we will not, and will
not permit any of our subsidiaries to, issue, assume or guarantee any
indebtedness secured by a mortgage, lien, pledge or other encumbrance ("Liens")
on any of our property or assets or the property or assets of any of our
subsidiaries unless the debt securities (and any other indebtedness ranking
equally with the debt securities if we so determine) will be secured equally
and ratably with (or prior to) such indebtedness so long as such indebtedness
is so secured. There are several exceptions to this restriction. For example,
this restriction will not apply to:
(1) Liens existing on January 1, 1995, the date as of which the Indenture
was first executed, or Liens provided for under the terms of agreements
existing on that date;
(2) Liens affecting property of a business existing at the time it is
acquired or at the time it is merged into or consolidated with us or one of
our subsidiaries;
(3) Liens on property existing at the time of acquisition of that
property or incurred to secure payment of the purchase price or to secure
indebtedness incurred prior to, at the time of, or within 24 months after
the acquisition of that property for the purpose of financing all or part
of the purchase price;
(4) Liens on property to secure all or part of the cost of exploration,
drilling or development of the property or all or any portion of the cost
of acquiring, constructing, altering, improving or repairing any property
or asset, real or personal, or improvements used in connection with that
property or Liens to secure indebtedness incurred by us or any of our
subsidiaries to provide funds for any such activities;
6
<PAGE>
(5) Liens that secure only indebtedness owing by any of our subsidiaries
to us or to another of our subsidiaries;
(6) Liens to secure indebtedness incurred in connection with pollution
control or abatement facilities or other forms of industrial revenue bond
financing and Liens to government entities;
(7) our Ordinary Course Liens (as defined in the Indenture) or Ordinary
Course Liens of any of our subsidiaries; and
(8) any extension, renewal or replacement of any Lien referred to in
clauses (1) through (7) above.
Also, we and any one or more of our subsidiaries may, without securing the
debt securities, issue, assume or guarantee indebtedness secured by a Lien
which would otherwise be subject to the Lien restrictions. The aggregate
principal amount of this indebtedness, together with all of our other
indebtedness and the indebtedness of our subsidiaries so secured at any one
time, may not exceed 10% of our consolidated net tangible assets. Under the
Indenture, the following types of transactions will not be deemed to create
indebtedness secured by Liens:
(1) the sale or other transfer of oil, gas or other minerals in place for
a period of time until, or in an amount such that, the transferee will
realize therefrom a specified amount (however determined) of money or
minerals, or the sale or other transfer of any other interest in property
of the character commonly referred to as a production payment, overriding
royalty, forward sale or similar interest; and
(2) Liens required by any contract or statute in order to permit us or
our subsidiaries to perform any contract or subcontract made with or at the
request of the United States, any state or any department, agency or
instrumentality of either. (Section 1005)
The Indenture defines the term "indebtedness" of a person as all
indebtedness, whether or not represented by bonds, debentures, notes or other
securities, created or assumed by that person for the repayment of money
borrowed and all payment obligations of that person as lessee under capital
leases. Under the Indenture, all indebtedness on which a person customarily
pays interest, if secured by a lien on our property or property owned by any
of our subsidiaries, will be deemed to be indebtedness of such person,
although that person has not assumed or become liable for the payment of the
indebtedness. All indebtedness of others guaranteed as to payment of principal
by any person or in effect guaranteed by that person through a contingent
agreement to purchase the indebtedness will also be deemed to be indebtedness
of that person. Indebtedness of a person will not include amounts payable out
of all or a portion of the oil, gas, natural gas, carbon dioxide, sulphur,
helium, coal, metals, minerals, steam, timber or other natural resources
produced, derived or extracted from properties owned or developed by that
person. (Section 101)
The Indenture defines the term "consolidated net tangible assets" as the
total amount of our consolidated assets after deducting:
(1) all of our current liabilities (excluding any which are, by their
terms, extendible or renewable at our option or at the option of one of our
subsidiaries to a time more than 12 months after the determination date);
and
(2) all of our goodwill, trade names, trademarks, patents, unamortized
debt
7
<PAGE>
discount and expense and other like intangible assets. (Section 101)
The Indenture defines the term "subsidiary" of Vastar as a corporation more
than 50% of the outstanding voting stock of which is owned, directly or
indirectly, by us, by one or more of our other subsidiaries, or by us together
with one or more of our other subsidiaries. For the purposes of this
definition, "voting stock" means stock which ordinarily has voting power for
the election of directors, whether at all times or only so long as no senior
class of stock has such voting power by reason of any contingency. (Section
101)
Events of Default. Unless otherwise provided with respect to any series of
debt securities, the following are events of default under the Indenture with
respect to any series of debt securities issued under the Indenture:
(1) our failure to pay principal of (or premium, if any, on) any debt
security of that series when due;
(2) our failure to pay any interest on any debt security of that series
when due, continued for 30 days;
(3) our failure to deposit any mandatory sinking fund payment, when due,
in respect of the debt securities of that series, continued for 30 days;
(4) our failure to perform any of our other covenants in the Indenture
(other than covenants solely for the benefit of another series of debt
securities), continued for 90 days after written notice;
(5) certain events of bankruptcy, insolvency or reorganization; and
(6) any other event of default that may be specified with respect to the
debt securities of that series. (Section 501)
If an event of default occurs with respect to any outstanding series of debt
securities as described in clause (1), (2), (3) or (6) above, the principal
amount of all outstanding debt securities of that series may be declared due
and payable immediately by either:
. the Trustee; or
. the holders of at least 25% in principal amount of that series.
If an event of default occurs as described in clause (4) above, the principal
amount of all outstanding debt securities may be declared due and payable
immediately by either:
. the Trustee; or
. the holders of at least 25% in principal amount of all outstanding debt
securities under the Indenture.
If an event of default described in clause (5) occurs, the principal amount
of all outstanding debt securities issued under the Indenture will immediately
be due and payable without any act required on the part of the Trustee or any
holder.
At any time after a declaration of acceleration with respect to a series of
debt securities has been made, the holders of a majority in principal amount of
the outstanding debt securities of the series (or holders of a majority in
principal amount of all outstanding debt securities, if the acceleration has
been declared by all holders) may, rescind and annul that acceleration if we
comply with conditions described in the Indenture, including paying or
depositing with the Trustee all overdue principal, interest and other amounts
which may be due and obtaining a waiver of or curing all existing events of
default. This recision or annulment must be made before a judgment or decree
for payment of the debt securities has been obtained. (Section 502) Depending
on the terms of our other indebtedness outstanding from time to time, an event
of default under the Indenture may give rise to cross-defaults on that other
indebtedness.
8
<PAGE>
The Indenture provides that the Trustee will, within 90 days after the
occurrence of a default in respect of any series of debt securities, give to
the holders of the debt securities of that series notice of all defaults known
to it that have not been cured or waived. The Trustee may withhold notice of
defaults other than payment defaults if it determines in good faith that
withholding that notice is in the interest of the holders of debt securities of
that series. The Trustee will not give notice of defaults caused by our failure
to perform, or breach of, any of our covenants or warranties contained in the
Indenture, other than payment defaults, until at least 30 days after the
occurrence of the default. For the purpose of this provision, "default" means
any event which is, or would become (after notice or lapse of time, or both),
an "event of default" as described above. (Section 602)
The holders of a majority in principal amount of the outstanding debt
securities of any series (or, in certain cases, a majority in principal amount
of all outstanding debt securities under the Indenture) have the right, subject
to certain limitations, to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on the Trustee with respect to the debt securities of that
series (or all outstanding debt securities under the Indenture). (Section 511)
The Indenture provides that, in case an event of default shall occur and be
continuing, the Trustee will exercise its rights and powers and use the same
degree of care and skill in its exercise as a prudent person would exercise or
use under the circumstances in the conduct of his or her own affairs. (Section
601) Subject to those provisions, the Trustee is under no obligation to
exercise any of its rights or powers under the Indenture at the request of the
holders of debt securities unless the requesting holders have offered the
Trustee satisfactory security or indemnity against the costs, expenses and
liabilities that the Trustee might incur in compliance with the request.
(Section 603)
The holders of a majority in principal amount of the outstanding debt
securities of any series (or, in certain cases, a majority in principal amount
of all outstanding debt securities under the Indenture) may, on behalf of the
holders of all debt securities of the series (or all outstanding debt
securities under the Indenture), waive any past default under the Indenture,
except:
. a default in the payment of the principal of (or premium, if any) or
interest on any debt security; or
. provisions under the Indenture which cannot be modified or amended
without the consent of the holder of each outstanding debt security
affected. (Section 512)
The holders of a majority in principal amount of the outstanding debt
securities affected may on behalf of the holders of all such debt securities
waive our compliance with the provisions described under "Limitation on Liens"
above and provisions of the Indenture requiring us to maintain our existence as
a corporation. (Section 1007)
The Indenture requires us to furnish to the Trustee a statement annually as
to our performance of some of our obligations under the Indenture and as to any
default in that performance. (Section 1006)
Modifications. We may modify or amend the Indenture with the consent of the
holders of a majority in principal amount of the outstanding debt securities
under the Indenture affected by the modification or amendment. However, without
the consent of each holder affected, no modification or amendment may:
9
<PAGE>
. change the stated maturity date of the principal of, or any installment
of interest on, any debt security;
. reduce the principal amount of, or the premium (if any) or interest on,
any debt security;
. change the place or the currency, currencies or currency unit or units in
which the principal of, or premium (if any) or interest on, any debt
security is to be paid;
. impair the right to institute suit for the enforcement of any payment on
any debt security; or
. reduce the percentage in principal amount of outstanding debt securities
required to consent to a modification or amendment of the Indenture or to
a waiver of compliance with certain provisions of the Indenture or to a
waiver of certain defaults. (Section 902)
The Indenture provides that we and the Trustee may, without the consent of
any holders of debt securities, enter into supplemental indentures for the
purposes, among other things, of adding to our covenants, adding additional
events of default, establishing the form or terms of debt securities or curing
ambiguities or inconsistencies in the Indenture. The Trustee may take action to
cure ambiguities or inconsistencies in the Indenture only if it does not
adversely affect the interests of the holders of the debt securities in any
material respect. (Section 901)
Consolidation, Merger and Sale of Assets. Without the consent of the holders
of outstanding debt securities, we may consolidate with or merge into, or
convey, transfer or lease our assets substantially as an entirety to, any
person, provided that:
. the person formed by the consolidation or into which Vastar is merged or
which acquires or leases our assets assumes by supplemental indenture our
obligations on the debt securities and under the Indenture;
. after giving effect to the transaction, no event of default and no event
which would become an event of default (after notice or lapse of time or
both), has occurred and is continuing; and
. other conditions described in the Indenture are met.
On our compliance with these provisions, we will (except in the case of a
lease) be relieved of our obligations under the Indenture and the debt
securities. (Article Eight)
Discharge of Certain Covenants. We may terminate our obligation to comply
with the covenants required to be complied with by us under the Indenture with
respect to any series of debt securities, other than our covenant to pay the
principal of (and premium, if any) and interest on the debt securities of that
series, if we:
(1) irrevocably deposit with the Trustee money or U.S. government
obligations maturing as to principal and interest sufficient to pay the
principal of, any interest on, and any mandatory sinking funds in respect
of, all outstanding debt securities of that series on the stated maturity
of such payments or on any redemption date; and
(2) comply with any additional conditions applicable to the satisfaction
and discharge of the Indenture with respect to that series of debt
securities. (Section 401)
The discharge of our obligation to comply with these covenants will not
affect our
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<PAGE>
obligations under the Indenture with respect to providing for the registration,
transfer or exchange of the debt securities, appointing a successor trustee if
necessary or providing names and addresses of the holders of debt securities to
the Trustee.
Defeasance. The supplemental indenture for any series of debt securities may
also provide for legal defeasance of that series. In those cases, if we:
(1) irrevocably deposit money or U.S. government obligations as described
above;
(2) make a request to the Trustee to be discharged from our obligations
on the debt securities of such series; and
(3) comply with any additional conditions applicable with respect to
legal defeasance of debt securities of that series;
then we will be deemed to have paid and discharged the entire indebtedness on
all the outstanding debt securities of that series and all obligations under
the Indenture related to that series shall be completely discharged, and the
holders thereof will thereafter be entitled only to payment out of the money or
U.S. government obligations deposited with the Trustee. If the Trustee is
unable to apply that trust fund by reason of any legal proceeding, order or
judgment, our obligations may be revived and restated. (Sections 403 and 404)
The Indenture defines "U.S. government obligations" as direct, noncallable
obligations of, or noncallable obligations the payment of principal of and
interest on which is guaranteed by, the United States of America, or to the
payment of which obligations or guarantees the full faith and credit of the
United States of America is pledged, or beneficial interests in a trust the
corpus of which consists exclusively of money or these obligations or a
combination thereof. (Section 401)
Form, Exchange, Registration and Transfer. Under the Indenture, we may issue
debt securities in definitive form as registered debt securities, as bearer
debt securities or both. (Section 301) The prospectus supplement relating to a
particular series of debt securities may contain terms relating to the form,
exchange, registration and transfer of bearer debt securities (which may be
more or less restrictive than terms described in this prospectus for registered
debt securities) and debt securities issuable in temporary or permanent global
forms.
You may exchange your registered debt securities of any series for other
registered debt securities of the same series and tenor and the same aggregate
principal amount, but the registered debt securities you receive in exchange
may be in different authorized denominations.
You may present your registered debt securities for registration of transfer
at the office of the security registrar or at the office of any transfer agent
we designate and identify in the applicable prospectus supplement. The transfer
form printed on the registered debt security must be completed and signed.
There will be no service charge payable to the security registrar or transfer
agent, but the holder will be required to pay any taxes and other governmental
charges that may apply. The transfer or exchange will occur when the security
registrar or transfer agent is satisfied with the documents of title and
identity of the person making the request. (Section 305) We have appointed the
Bank of Montreal Trust Company, an affiliate of the Trustee, as the security
registrar.
We may at any time rescind our designation of any transfer agent for the debt
securities of any series or approve a change in the location through which any
transfer agent
11
<PAGE>
acts. If debt securities of a series are issuable solely as registered debt
securities, however, the Indenture requires us to maintain a transfer agent in
each place of payment for that series. We may at any time designate additional
transfer agents. (Section 1002)
In the event of any redemption in part, we will not be required to:
. issue, register the transfer of or exchange any registered debt
securities of any series which has been called for redemption during a
period beginning 15 days prior to the selection of debt securities for
redemption and ending on the close of business on the day we mail the
relevant notice of redemption; or
. register the transfer of or exchange any registered debt security, or
portion thereof, we have called for redemption, except the unredeemed
portion of any registered debt security we have called for redemption in
part. (Section 305)
Payment and Paying Agents. Unless otherwise indicated in an applicable
prospectus supplement, we will pay principal of and any premium and interest on
registered debt securities in the designated currency at the office of the
paying agent or agents we designate from time to time. We may elect to pay
interest by check mailed to the holder at the holder's address set forth in the
security register. Payment of any installment of interest on any registered
debt security will be made to the person in whose name the registered debt
security is registered at the close of business on the regular record date for
such interest, unless we otherwise indicate in an applicable prospectus
supplement. (Section 307)
The corporate trust office of the Bank of Montreal Trust Company, an
affiliate of the Trustee, in New York, New York, will be designated as our
paying agent with respect to debt securities issued solely as registered debt
securities, unless we otherwise indicate in an applicable prospectus
supplement. We may at any time designate additional paying agents, rescind the
designation of any paying agent or approve a change in the office through which
any paying agent acts, except that we will maintain a paying agent in each
place of payment required for each series of debt securities. (Section 1002)
All money we pay to a paying agent for the payment of principal of and any
premium or interest on any debt security which remains unclaimed for three
years after that principal, premium or interest was due will be repaid to us
(subject to applicable escheat laws). The holder of any debt security or coupon
entitled to that payment will thereafter look only to us for that payment.
(Section 1003)
Book-Entry Debt Securities. We may issue some or all of the debt securities
of a series in the form of one or more global debt securities that we would
deposit with a depositary or its nominee who we would identify in the
applicable prospectus supplement. We will describe specific terms of any
depositary arrangement with respect to any portion of a series of debt
securities and the rights of and limitations on the owners of beneficial
interests in any such global debt security in the applicable prospectus
supplement. (Section 204)
Meetings. The Indenture contains provisions for convening meetings of the
holders of debt securities of any or all series. (Section 1301) A meeting of
the holders of any series may be called at any time by the Trustee or upon our
request or the request of holders of at least 10% in principal amount of the
outstanding debt securities of that series, in each case on notice given as
described under "Notices" below. (Section 1302)
12
<PAGE>
Generally, resolutions presented at a meeting at which a quorum is present
may be adopted by the affirmative vote of the holders of (1) a majority in
principal amount of the outstanding debt securities of the series, or (2) a
specified percentage in principal amount of the outstanding debt securities of
the series, which is less than a majority, where the Indenture states that the
action described in the resolution may be taken by this specified percentage.
However, these provisions would not permit the adoption of resolutions
modifying or amending the Indenture which require the consent of the holders of
each outstanding debt security affected, as described under "Modifications"
above.
Any resolution properly passed and any action properly taken at any meeting
of holders of debt securities of any series will be binding on all holders of
debt securities of that series and any related coupons. The quorum required for
any meeting of holders of outstanding debt securities of any series called to
adopt a resolution, and at any reconvened meeting, will be persons holding or
representing a majority in principal amount of the outstanding debt securities
of that series. (Section 1304)
Notices. Notices to holders of registered debt securities will be given by
mail to the addresses of such holders as they appear in the security register.
(Section 107)
The Trustee. The Indenture contains limitations on the right of the Trustee,
as a creditor of ours, to obtain payment of claims and to realize on certain
property received with respect to those claims, as security or otherwise.
(Section 613) The Indenture permits the Trustee to engage in other
transactions, except that, if the Trustee acquires any conflicting interest (as
defined), the Trustee must eliminate that conflict or resign. (Section 608)
The paying agent, who is an affiliate of the Trustee, has made loans to us
and to our affiliates from time to time in the ordinary course of business and
at prevailing interest rates under agreements with commercial bank groups. In
addition, the paying agent may from time to time serve as a depositary of our
funds and perform other services for us.
13
<PAGE>
PLAN OF DISTRIBUTION
We may sell the debt securities:
. directly to a limited number of institutional purchasers or to a single
purchaser;
. through agents selected by us; or
. through underwriters acting alone or as part of a syndicate.
The distribution of the debt securities may be effected from time to time in
one or more transactions at a fixed price or prices, or at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices or at negotiated prices. The prospectus supplement with respect to each
series of debt securities we offer will set forth the terms of the offering
with respect to that series, including:
. the name or names of any underwriters;
. the purchase price of the debt securities;
. the amount of any underwriting discounts and other items constituting
underwriters' compensation;
. the initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers;
. terms of any redemption, exchange or conversion rights;
. our proceeds from such sale; and
. any securities exchanges on which that series of debt securities may be
listed.
If we use underwriters in the sale, the underwriters will acquire the debt
securities for their own account and may resell them from time to time in one
or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale. Unless we
otherwise specify in the prospectus supplement, the obligations of the
underwriters to purchase the offered debt securities will be subject to certain
conditions precedent and the underwriters will be obligated to purchase all the
offered debt securities if any are purchased. The initial public offering price
and any discounts or concessions allowed or reallowed or paid to dealers may be
changed from time to time.
We may sell debt securities directly to investors, dealers or otherwise, or
periodically through agents we may designate. We will name any agent involved
in the offer or sale of debt securities in the prospectus supplement for the
offering. The amount of any commissions payable by us to any agent will be set
forth in the prospectus supplement. Any of those agents will be acting on a
best efforts basis for the period of its appointment unless we otherwise
indicate in the prospectus supplement.
We may authorize agents, underwriters or dealers to solicit offers by
specified institutions to purchase debt securities from us at the public
offering price set forth in a prospectus supplement pursuant to delayed
delivery contracts providing for payment and delivery on a specified date in
the future. If we elect to use delayed delivery contracts, payment and delivery
of debt securities will be subject only to those conditions we describe in that
prospectus supplement.
Underwriters, dealers and agents may be entitled, under agreements entered
into with us, to indemnification by us against specified liabilities, including
liabilities under the Securities Act of 1933. Underwriters, dealers and agents
may also be entitled to contribution from us with respect to payments that they
may be required to make with respect to those liabilities. Underwriters,
dealers and agents may
14
<PAGE>
be customers of, engage in transactions with, or perform services for us in the
ordinary course of business.
You have no assurance that a secondary market will be created for any series
of debt securities or, if such a market is created, that it will continue.
15
<PAGE>
PRINCIPAL STOCKHOLDER; CONTROL OF THE COMPANY
As of the date of this prospectus, ARCO owns 80,000,001 shares of the
Company's common stock, representing approximately 82.1% of the outstanding
shares of common stock.
Under applicable provisions of the General Corporation Law of Delaware, ARCO
will be able, acting alone, to elect the entire board of directors of the
Company and to approve any action requiring stockholder approval. The retention
by ARCO of more than a majority of the outstanding voting stock will preclude
any acquisition of control of the Company not favored by ARCO.
EXPERTS
The financial statements incorporated in this prospectus by reference to the
Annual Report on Form 10-K for the year ended December 31, 1998, have been so
incorporated in reliance on the report of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of that firm as experts in
auditing and accounting.
The information incorporated by reference herein regarding our total proved
reserves as of December 31, 1998 was prepared by us and reviewed by Ryder Scott
Company Petroleum Engineers in reliance on the authority of Ryder Scott Company
Petroleum Engineers as experts with respect to those matters.
16
<PAGE>
VALIDITY OF DEBT SECURITIES
The validity of the debt securities offered hereby will be passed on for us
by Albert D. Hoppe, Esq., Vice President, General Counsel and Secretary of
Vastar Resources, Inc., 15375 Memorial Drive, Houston, Texas 77079. As of May
1, 1999, Mr. Hoppe owned options to purchase 69,197 shares of such stock.
Certain legal matters in connection with the debt securities may be passed on
for the underwriters, dealers or agents by Baker & Botts, L.L.P., Houston,
Texas.
17
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following tables set forth those expenses for distribution to be
incurred in connection with the issuance and distribution of the securities
being registered.
<TABLE>
<S> <C>
Securities and Exchange Commission Fee.......................... $ 83,400
Printing Expenses............................................... $ 50,000
Accounting Fees and Expenses.................................... $ 45,000
Legal Fees and Expenses......................................... $ 40,000
Rating Agency Fees.............................................. $230,000
Transfer Agent Fees............................................. $ 3,000
Trustee Fees and Expenses....................................... $ 11,000
Miscellaneous Expenses.......................................... $ 8,000
--------
Total....................................................... $470,400
========
</TABLE>
All these expenses, except the Securities and Exchange Commission
registration fee, represent estimates only.
Item 15. Indemnification of Directors and Officers
Reference is made to Section 25 of the By-Laws of the Company as set forth
below.
Section 25 of the By-Laws of the Company provides:
"(a) Right to Indemnification. Each person who was or is a party or is
threatened to be made a party to or is involved or is threatened to be
involved (as a witness or otherwise) in or otherwise requires
representation by counsel in connection with any threatened, pending or
completed action, suit or proceeding, or any inquiry that such person in
good faith believes might lead to institution of any such action, suit or
proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding"), by reason of the fact that he or she is or
was a director or officer of the Company or is or was serving at the
request of the Company as a director, officer, employee or agent of another
corporation or of a partnership, joint venture, trust or other enterprise,
including service with respect to employee benefit plans, and the basis of
such proceeding is alleged action or inaction in an official capacity or in
any other capacity while serving as such a director, officer, employee or
agent, shall be indemnified and held harmless by the Company to the fullest
extent authorized by the General Corporation Law of Delaware, as the same
exists or may hereafter be amended (but, in the case of any such amendment
with reference to events occurring prior to the effective date thereof,
only to the extent that such amendment permits the Company to provide
broader indemnification rights than such law permitted the Company to
provide prior to such amendment), against all costs, charges, expenses,
liabilities and losses (including attorneys' fees, judgments, fines, ERISA
excise taxes or penalties and amounts paid in settlement) reasonably
incurred or suffered by such person in connection therewith and such
indemnification shall continue as to a person who has ceased to be a
director or officer (or to serve another entity at the request of the
Company) and shall inure to the benefit of such person's heirs, personal
representatives and estate; provided, however, that, except as provided in
paragraph (b) hereof, the Company shall indemnify any such person seeking
indemnification in connection with a proceeding (or part thereof) initiated
by such person against the Company only if such proceeding (or part
thereof) was authorized prior to its initiation by a majority of the
disinterested members of the Board of Directors of the Company. The rights
to indemnification conferred in this Section shall include the right to be
paid by the Company any
II-1
<PAGE>
expenses incurred in defending any such proceeding in advance of its final
disposition; provided, however, that, if the General Corporation Law of
Delaware requires, payment shall be made to or on behalf of such person
only upon delivery to the Company of an undertaking, by or on behalf of
such person, to repay all amounts so advanced if it shall ultimately be
determined that such person is not entitled to be indemnified under this
Section or otherwise. The rights to indemnification conferred in this
Section shall be deemed to be a contract between the Company and each
person who serves in the capacities described above at any time while this
Section is in effect. Any repeal or modification of this Section shall not
in any way diminish any rights to indemnification of such person or the
obligations of the Company arising hereunder.
(b) Right of Claimant to Bring Suit. If a claim under paragraph (a) of
this Section is not paid in full by the Company within sixty days after a
written claim has been received by the Company, the claimant may at any
time thereafter bring suit against the Company to recover the unpaid amount
of the claim. If successful in whole or in part, the claimant shall be
entitled to be paid also the expense of prosecuting or defending such
claim. In any action brought by the claimant to enforce a right to
indemnification hereunder or by the Company to recover payments by the
Company for expenses incurred by a claimant in a proceeding in advance of
its final disposition, the burden of proving that the claimant is not
entitled to be indemnified under this Section or otherwise shall be on the
Company. Neither the failure of the Company (including its Board of
Directors, independent legal counsel or its stockholders) to have made a
determination prior to the commencement of such action that indemnification
of the claimant is proper in the circumstances because the claimant has met
the applicable standard of conduct set forth in the General Corporation Law
of Delaware, nor an actual determination by the Company (including its
Board of Directors, independent legal counsel or its stockholders) that the
claimant has not met such applicable standard of conduct, shall create a
presumption that the claimant has not met the applicable standard of
conduct or, in the case of such action brought by the claimant, be a
defense to the action.
(c) Non-exclusivity of Rights. The right to indemnification and the
payment of expenses incurred in defending a proceeding in advance of its
final disposition conferred in this Section shall not be exclusive of any
other right which any person may have or hereafter acquire under any
statute, the Company's Certificate of Incorporation, any By-Law, any
agreement, a vote of Company stockholders or of disinterested Company
directors, or otherwise, both as to action in that person's official
capacity and as to action in any other capacity by holding such office, and
shall continue after the person ceases to serve the Company as a director
or officer or to serve another entity at the request of the Company.
(d) Insurance. The Company may maintain insurance, at its expense, to
protect itself and any director or officer of the Company or another
corporation, partnership, joint venture, trust or other enterprise against
any expense, liability or loss, whether or not the Company would have the
power to indemnify such person against such expense, liability or loss
under the General Corporation Law of Delaware.
(e) Indemnity Agreements. The Company may from time to time enter into
indemnity agreements with the persons who are members of its Board of
Directors and with such officers or other persons as the Board may
designate.
(f) Indemnification of Employees and Agents of the Company. The Company
may, under procedures authorized from time to time by the Board of
Directors, grant rights to indemnification, and to be paid by the Company
the expenses incurred in defending any proceeding in advance of its final
disposition, to any employee or agent of the Company to the fullest extent
of the provisions of this Section 25."
The Company's Certificate of Incorporation provides that, to the fullest
extent permitted by the General Corporation Law of Delaware, as the same
exists or may hereafter be amended, a
II-2
<PAGE>
director of the Company shall not be liable to the Company or to its
stockholders for monetary damages for breach of fiduciary duty as a
director. Section 102(b)(7) of the Delaware General Corporation Law permits
a Delaware corporation such as the Company to include in its certificate of
incorporation a provision that eliminates or limits the ability of the
Company and its stockholders to recover monetary damages from a director
for breach of fiduciary duty as a director; but does not permit such a
provision to eliminate or limit the liability of a director for (i) any
breach of the duty of loyalty to the Company or its stockholders, (ii) acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) paying a dividend or approving a stock
repurchase which is illegal under certain provisions of Delaware law or
(iv) any transaction from which the director derived an improper personal
benefit.
Under an Insurance Services Agreement between ARCO and the Company, ARCO
provides the Company with insurance coverage under ARCO's Directors' and
Officers' Liability Insurance, which currently has a limit of $210 million,
to the extent authorized by the By-Laws of the Company and the laws of the
State of Delaware.
Reference is also made to the indemnification provisions in the
Underwriting Agreement filed as an Exhibit to this Registration Statement.
Item 16. Exhibits
<TABLE>
<S> <C>
1.1 Form of proposed Underwriting Agreement.
4.1* Indenture, dated as of January 1, 1995, between the Company and
NationsBank of Texas, N.A., Trustee (filed with the Commission as Exhibit
4.1 to Vastar's report on Form 10-K for the year ended December 31, 1994
(Commission File No. 1-13108) and incorporated herein by reference).
4.2* Supplemental Indenture, dated May 18, 1995, by and among Vastar Resources,
Inc., NationsBank of Texas N.A., Harris Trust and Savings Bank and Bank of
Montreal Trust Company (filed with the Commission as Exhibit 4 to Vastar's
Current Report on Form 8-K, dated May 5, 1995 (Commission File
No. 1-13108) and incorporated herein by reference).
4.3* Second Supplemental Indenture, dated as of April 16, 1998, by and among
Vastar Resources, Inc., Harris Trust and Savings Bank, as Trustee and Bank
of Montreal Trust Company, as paying agent (filed with the Commission as
Exhibit 4 to Vastar's report on Form 10-Q for the quarter ended March 31,
1998 (Commission File No. 1-13108) and incorporated herein by reference).
5 Opinion with consent of Albert D. Hoppe, Esq., Vice President, General
Counsel and Secretary of the Company.
12 Statement of computation of ratio of earnings to fixed charges.
23.1 Consent of Albert D. Hoppe, Esq., Vice President, General Counsel and
Secretary of the Company (included in Exhibit 5).
23.2 Consent of PricewaterhouseCoopers LLP.
23.3 Consent of Ryder Scott Company Petroleum Engineers.
24 Power of Attorney (set forth on the signature page hereof).
25 Statement of Eligibility and Qualification on Form T-1 under Trust
Indenture Act of 1939 of Harris Trust and Savings Bank.
</TABLE>
- --------
* Incorporated by reference
II-3
<PAGE>
Item 17. Undertakings
(a) Undertaking Pursuant to Rule 415.
The Company hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933 (the "Act");
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement;
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or furnished
to the Commission by the Company pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934 (the "Exchange Act") that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the Act,
each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) Undertaking Regarding Filings Incorporating Subsequent Exchange Act
Documents by Reference.
The Company hereby undertakes that, for purposes of determining any
liability under the Act, each filing of the Company's annual report pursuant
to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Exchange Act) that is incorporated by reference in the
Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Undertaking in Respect of Indemnification.
Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the Company
pursuant to the provisions described and the documents referenced under Item
15 above or otherwise, the Company has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Company will, unless in the opinion of its counsel the matter has been settled
by controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
II-4
<PAGE>
(d) Undertaking in Respect of Prospectus Omitting Certain Information.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Houston, State of Texas, on May 27, 1999.
VASTAR RESOURCES, INC.
(Registrant)
/s/ Charles D. Davidson
By:______________________________________
Charles D. Davidson, President and
Chief Executive Officer
---------------
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned officers and/or
directors of the Registrant hereby constitutes and appoints Michael E. Wiley,
Charles D. Davidson and Steven J. Shapiro, and each of them, as his or her
true and lawful attorneys-in-fact and agents, with full power of substitution
and resubstitution, for him or her and in his or her name, place and stead to
execute any and all amendments, including post-effective amendments, to this
Registration Statement in the capacities set forth opposite his or her name,
and to file the same, with exhibits thereto, and any other documents in
connection therewith, with the Securities and Exchange Commission, granting
unto said attorneys-in-fact and agents full power and authority to do and
perform each and every act and thing requisite and necessary to be done, as
fully to all intents and purposes as he or she might or could do in person and
hereby ratifies and confirms all that said attorneys-in-fact and agents or any
of them or their substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Michael E. Wiley
- ------------------------------------
Michael E. Wiley Michael E. Wiley
Chairman of the Board and
Director May 27, 1999
/s/ Charles D. Davidson
- ------------------------------------
Charles D. Davidson Charles D. Davidson
(Principal executive officer) President, Chief Executive
Officer and Director May 27, 1999
/s/ Steven J. Shapiro
- ------------------------------------
Steven J. Shapiro Steven J. Shapiro
(Principal financial officer) Senior Vice President, Chief
Financial Officer and
Director May 27, 1999
/s/ Jimmie D. Callison
- ------------------------------------
Jimmie D. Callison Jimmie D. Callison
Director May 27, 1999
/s/ Terry G. Dallas
- ------------------------------------
Terry G. Dallas Terry G. Dallas May 27, 1999
Director
</TABLE>
II-6
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Marie L. Knowles
- ------------------------------------
Marie L. Knowles Marie L. Knowles
Director May 27, 1999
/s/ Robert C. LeVine
- ------------------------------------
Robert C. LeVine Robert C. LeVine May 27, 1999
Director
/s/ William D. Schulte
- ------------------------------------
William D. Schulte William D. Schulte
Director May 27, 1999
/s/ Donald R. Voelte, Jr.
- ------------------------------------
Donald R. Voelte, Jr. Donald R. Voelte, Jr.
Director May 27, 1999
/s/ Joseph P. McCoy
- ------------------------------------
Joseph P. McCoy Joseph P. McCoy
(principal accounting officer) Vice President and Controller May 27, 1999
</TABLE>
II-7
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
No. Description
------- -----------
<C> <S>
1.1 Form of proposed Underwriting Agreement.
4.1* Indenture, dated as of January 1, 1995, between the Company and
NationsBank of Texas, N.A., Trustee (filed with the Commission as
Exhibit 4.1 to Vastar's report on Form 10-K for the year ended
December 31, 1994 (Commission File No. 1-13108) and incorporated
herein by reference).
4.2* Supplemental Indenture, dated May 18, 1995, by and among Vastar
Resources, Inc., NationsBank of Texas N.A., Harris Trust and Savings
Bank and Bank of Montreal Trust Company (filed with the Commission
as Exhibit 4 to Vastar's Current Report on Form 8-K, dated May 5,
1995 (Commission File No. 1-13108) and incorporated herein by
reference).
4.3* Second Supplemental Indenture, dated as of April 16, 1998, by and
among Vastar Resources, Inc., Harris Trust and Savings Bank, as
Trustee and Bank of Montreal Trust Company, as paying agent (filed
with the Commission as Exhibit 4 to Vastar's report on Form 10-Q for
the quarter ended March 31, 1998 (Commission File No. 1-13108) and
incorporated herein by reference).
5 Opinion with consent of Albert D. Hoppe, Esq., Vice President,
General Counsel and Secretary of the Company.
12 Statement of computation of ratio of earnings to fixed charges.
23.1 Consent of Albert D. Hoppe, Esq., Vice President, General Counsel
and Secretary of the Company (included in Exhibit 5).
23.2 Consent of PricewaterhouseCoopers LLP.
23.3 Consent of Ryder Scott Company Petroleum Engineers.
24 Power of Attorney (set forth on the signature page hereof).
25 Statement of Eligibility and Qualification on Form T-1 under Trust
Indenture Act of 1939 of Harris Trust and Savings Bank.
</TABLE>
- --------
* Incorporated by reference
<PAGE>
EXHIBIT 1.1
Vastar Resources, Inc.
Debt Securities
--------------------------
Underwriting Agreement
________, 1999
[Name and address of Underwriter(s)]
Ladies and Gentlemen:
From time to time Vastar Resources, Inc., a Delaware corporation (the
"Company"), proposes to enter into one or more Pricing Agreements (each a
"Pricing Agreement") in the form of Annex I hereto, with such additions and
deletions as the parties thereto may determine, and, subject to the terms and
conditions stated herein and therein, to issue and sell to the firms named in
Schedule I to the applicable Pricing Agreement (such firms constituting the
"Underwriters" with respect to such Pricing Agreement and the securities
specified therein) certain of its debt securities (the "Securities") specified
in Schedule II to such Pricing Agreement (with respect to such Pricing
Agreement, the "Designated Securities").
The terms and rights of any particular issuance of Designated Securities
shall be as specified in the Pricing Agreement relating thereto and in or
pursuant to the indenture (the "Indenture") identified in such Pricing
Agreement.
1. Particular sales of Designated Securities may be made from time to time
to the Underwriters of such Securities, for whom the firms designated as
representatives of the Underwriters of such Securities in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as sole representative of
the Underwriters and to an Underwriter or Underwriters who act without any firm
being designated as its or their representatives. This Underwriting Agreement
shall not be construed as an obligation of the Company to sell any of the
Securities or as an obligation of any of the Underwriters to purchase the
Securities. The obligation of the Company to issue and sell any of the
Securities and the obligation of any of the Underwriters to purchase any of the
Securities shall be evidenced by the Pricing Agreement with respect to the
Designated Securities specified therein. Each Pricing Agreement shall specify
the aggregate principal amount of such Designated Securities, the initial public
offering price of such Designated Securities, the purchase price to the
Underwriters of such Designated Securities, the names of the Underwriters of
such Designated Securities, the names of the Representatives of such
Underwriters and the principal amount of such Designated Securities to be
purchased by each Underwriter and shall set forth the date, time and manner of
delivery of such Designated Securities and payment therefor. The Pricing
Agreement shall also specify (to the extent not set forth in the Indenture and
the registration statement and prospectus with respect thereto) the terms of
such Designated Securities. A Pricing Agreement shall be in the form of an
executed writing (which may be in counterparts), and may be evidenced by an
exchange of telegraphic communications or any other rapid transmission device
designed to produce a written record of communications
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transmitted. The obligations of the Underwriters under this Agreement and each
Pricing Agreement shall be several and not joint.
2. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (File No. 333-
67159) (the "Initial Registration Statement") pursuant to the Securities
Act of 1933, as amended (the "Act"); the Initial Registration Statement and
any post-effective amendment thereto, each in the form heretofore delivered
or to be delivered to the Representatives and, excluding exhibits to the
Initial Registration Statement, but including all documents incorporated by
reference in the prospectus contained therein, to the Representatives for
each of the other Underwriters, have been declared effective by the
Commission in such form; other than a registration statement, if any,
increasing the size of the offering (the "Rule 462(b) Registration
Statement"), which was filed with the Commission pursuant to Rule 462(b)
under the Act and became effective on filing, no other document with
respect to the Initial Registration Statement or document incorporated by
reference therein has heretofore been filed or transmitted for filing with
the Commission (other than prospectuses filed pursuant to Rule 424(b) under
the Act, each in the form heretofore delivered to the Representatives); and
no stop order suspending the effectiveness of the Initial Registration
Statement, any post-effective amendment thereto or the Rule 462(b)
Registration Statement, if any, has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any preliminary
prospectus and any preliminary prospectus supplement included in the
Initial Registration Statement or filed with the Commission pursuant to
Rule 424(a) under the Act are hereinafter collectively called a
"Preliminary Prospectus"; each of the various parts of the Initial
Registration Statement, any post-effective amendment thereto and the Rule
462(b) Registration Statement, if any, including all exhibits thereto and
the documents incorporated by reference in the prospectus contained in the
Initial Registration Statement at the time such part of the Initial
Registration Statement became effective but excluding Form T-1, each as
amended at the time such part of the Initial Registration Statement became
effective or such part of the Rule 462(b) Registration Statement, if any,
became or becomes effective, are hereinafter collectively called the
"Registration Statement"; the prospectus relating to the Securities, in the
form in which it has most recently been filed, or transmitted for filing,
with the Commission on or prior to the date of this Agreement, being
hereinafter called the "Prospectus"; any reference herein to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Item 12
of Form S-3 under the Act, as of the date of such Preliminary Prospectus or
Prospectus, as the case may be; any reference to any amendment or
supplement to any Preliminary Prospectus or the Prospectus shall be deemed
to refer to and include any documents filed after the date of such
Preliminary Prospectus or Prospectus, as the case may be, under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
incorporated by reference in such Preliminary Prospectus or Prospectus, as
the case may be; any reference to any amendment to the Registration
Statement shall be deemed to refer to and include any annual report of the
Company filed pursuant to Sections 13(a) or 15(d) of the Exchange Act after
the effective date of the Initial Registration Statement that is
incorporated by reference in the Registration Statement; and any reference
to the Prospectus as amended or supplemented shall be deemed to refer to
the Prospectus as amended or supplemented in relation to the applicable
Designated Securities in the form in which it is filed with the Commission
pursuant to Rule 424(b) under the Act in accordance with Section 5(a)
hereof, including any documents incorporated by reference therein as of the
date of such filing);
(b) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may
be, conformed in all material respects to the requirements of the Act or
the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents 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; and any further documents so filed and incorporated by
reference in the Prospectus or any further amendment or supplement thereto,
when such documents become effective or are filed with the Commission, as
the case may be, will
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conform in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder 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;
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 an Underwriter of
Designated Securities through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Securities;
(c) The Registration Statement and the Prospectus conform, and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of
the Act and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), and the rules and regulations of the Commission thereunder
and do not and will not, as of the applicable effective date as to the
Registration Statement and any amendment thereto and as of the applicable
filing date as to the Prospectus and any amendment or supplement thereto,
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; 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 an Underwriter of Designated Securities through the Representatives
expressly for use in the Prospectus as amended or supplemented relating to
such Securities;
(d) Neither the Company nor any of its Subsidiaries (as used in this
Agreement, "Subsidiaries" shall mean only those corporations, partnerships
or other entities that are wholly owned, directly or indirectly, by the
Company) has sustained since the date of the latest audited financial
statements included or incorporated by reference in the Prospectus any
material loss or interference with its business from fire, explosion, flood
or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as
set forth or contemplated in the Prospectus; and, since the respective
dates as of which information is given in the Registration Statement and
the Prospectus, there has not been any change in the capital stock of the
Company or any of its Subsidiaries (other than issuances of common stock
upon exercise of options that (i) are issued pursuant to the Company's
stock option plans described in the Prospectus and (ii) were outstanding on
the date of the latest balance sheet included or incorporated by reference
in the Prospectus), and there has been no material change in the working
capital and no increase in the long-term debt of the Company and its
Subsidiaries taken as a whole or any material adverse change, or, to the
best knowledge of any executive officer of the Company, any development
that would result in a prospective material adverse change, in or affecting
the general affairs, management, consolidated financial position,
stockholders' equity or results of operations of the Company and its
Subsidiaries taken as a whole, otherwise than as set forth or contemplated
in the Prospectus;
(e) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with
power and authority (corporate and other) to own its properties and conduct
its business as described in the Prospectus, and has been duly qualified as
a foreign corporation for the transaction of business and is in good
standing under the laws of each other jurisdiction in which it owns or
leases properties, or conducts any business, so as to require such
qualification, or is subject to no material liability or disability by
reason of the failure to be so qualified in any such jurisdiction; and each
Subsidiary of the Company has been duly incorporated and is validly
existing as a corporation and is in good standing under the laws of its
jurisdiction of incorporation;
(f) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company
have been duly and validly authorized and issued, are fully paid and non-
assessable and conform to the description of the capital stock contained in
the Prospectus; and all of the issued shares of capital stock of each
subsidiary of the Company have been duly and validly authorized and
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issued, are fully paid and non-assessable and (except for directors'
qualifying shares) are owned directly or indirectly by the Company, free
and clear of all liens, encumbrances, equities or claims;
(g) The Securities have been duly authorized, and, when Designated
Securities are issued and delivered pursuant to this Agreement and the
Pricing Agreement with respect to such Designated Securities, such
Designated Securities will have been duly executed, authenticated, issued
and delivered and will constitute valid and legally binding obligations of
the Company entitled to the benefits provided by the Indenture, which will
be substantially in the form filed as an exhibit to the Registration
Statement; the Indenture has been duly authorized and duly qualified under
the Trust Indenture Act and, at the Time of Delivery (as defined in Section
4 hereof) for such Designated Securities, the Indenture will constitute a
valid and legally binding instrument, enforceable in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency, moratorium,
reorganization, fraudulent conveyance and other laws of general
applicability relating to or affecting creditors' rights and to general
equity principles (regardless of whether enforceability is considered in a
proceeding at law or in equity); and the Indenture conforms, and the
Designated Securities will conform, to the descriptions thereof contained
in the Prospectus as amended or supplemented with respect to such
Designated Securities;
(h) The issue and sale of the Securities and the compliance by the
Company with all of the provisions of the Securities, the Indenture, this
Agreement and any Pricing Agreement, and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other material agreement or instrument to which the Company or
any of its Subsidiaries is a party or by which the Company or any of its
Subsidiaries is bound or to which any of the property or assets of the
Company or any of its Subsidiaries is subject, nor will such action result
in any violation of the provisions of the Certificate of Incorporation or
By-laws of the Company or any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the
Company or any of its Subsidiaries or any of their respective properties;
and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the issue and sale of the Securities or the consummation by
the Company of the transactions contemplated by this Agreement or any
Pricing Agreement or the Indenture, except such as have been, or will have
been prior to the Time of Delivery, obtained under the Act and the Trust
Indenture Act and such consents, approvals, authorizations, registrations
or qualifications as may be required under state securities or Blue Sky
laws in connection with the purchase and distribution of the Securities by
the Underwriters;
(i) Neither the Company nor any of its Subsidiaries is in violation of
its Certificate of Incorporation or By-laws or in default in the
performance or observance of any obligation, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement, lease
or other agreement or instrument to which it is a party or by which it or
any of its properties may be bound, which default would have a material
adverse affect on the current or future consolidated financial position,
stockholders' equity or results of operations of the Company and its
Subsidiaries;
(j) The statements set forth in the Prospects under the caption
"Description of Debt Securities," insofar as they purport to constitute a
summary of the terms of the Securities, and under the caption "Plan of
Distribution," insofar as they purport to describe the provisions of the
laws and documents referred to therein, are accurate, complete and fair;
(k) Other than as set forth or contemplated in the Prospectus, there
are no legal or governmental proceedings pending to which the Company or
any of its Subsidiaries is a party or of which any property of the Company
or any of its Subsidiaries is the subject which, if determined adversely to
the Company or any of its Subsidiaries, would individually or in the
aggregate have a material adverse effect on the consolidated financial
position, stockholder's equity or results of operations of the Company and
its Subsidiaries; and, to
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the best of the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(l) Neither the Company nor any of its Subsidiaries, nor any of their
joint ventures or affiliates (as defined in the rules and regulations of
the Commission under the Act) does business with the government of Cuba or
with any person or affiliate located in Cuba within the meaning of Section
517.075, Florida Statutes;
(m) PricewaterhouseCoopers LLP, who have certified certain financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder; and
(n) Ryder Scott Company Petroleum Engineers, whose report is included
in the Prospectus, are independent engineers within the meaning of the Act
and the rules and regulations of the Commission thereunder.
3. Upon the execution of the Pricing Agreement applicable to any
Designated Securities and authorization by the Representatives of the release of
such Designated Securities, the several Underwriters propose to offer such
Designated Securities for sale upon the terms and conditions set forth in the
Prospectus as amended or supplemented.
4. Designated Securities to be purchased by each Underwriter pursuant to
the Pricing Agreement relating thereto, in the form specified in such Pricing
Agreement, and in such authorized denominations and registered in such names as
the Representatives may request upon at least forty-eight hours' prior notice to
the Company, shall be delivered by or on behalf of the Company to the
Representatives for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price therefor by certified or
official bank check or checks payable to the order of the Company or by wire
transfer to the account specified by the Company to the Representatives at least
forty-eight hours in advance, in any case in the funds specified in such Pricing
Agreement and in the manner and at the place and time and date specified in such
Pricing Agreement or at such other place and time and date as the
Representatives and the Company may agree upon in writing, such time and date
being herein called the "Time of Delivery" for such Securities.
5. The Company agrees with each of the Underwriters of any Designated
Securities:
(a) To prepare the Prospectus as amended or supplemented in relation to
the applicable Designated Securities in a form approved by the
Representatives and to file such Prospectus pursuant to Rule 424(b) under
the Act not later than the Commission's close of business on the second
business day following the execution and delivery of the Pricing Agreement
relating to the applicable Designated Securities or, if applicable, such
earlier time as may be required by Rule 424(b); to make no further
amendment or any supplement to the Registration Statement or Prospectus as
amended or supplemented after the date of the Pricing Agreement relating to
such Securities and prior to the Time of Delivery for such Securities which
shall be disapproved by the Representatives for such Securities promptly
after reasonable notice thereof; to advise the Representatives promptly of
any such amendment or supplement after such Time of Delivery and furnish
the Representatives with copies thereof; to file promptly all reports and
any definitive proxy or information statements required to be filed by the
Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act for so long as the delivery of a prospectus is required
in connection with the offering or sale of such Securities, and during such
same period to 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 or any supplement to the
Prospectus or any amended Prospectus has been filed with the Commission, of
the issuance by the Commission of 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
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sale in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the Commission for
the amending or supplementing of the Registration Statement or Prospectus
or for additional information; 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 promptly use its best efforts to obtain the withdrawal of
such order;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Securities for
offering and sale under the securities laws of such jurisdictions as the
Representatives may request and to comply with such laws so as to permit
the continuance of sales and dealings therein in such jurisdictions for as
long as may be necessary to complete the distribution of such Securities,
provided that in connection therewith the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction;
(c) To furnish the Underwriters with copies of the Prospectus as
amended or supplemented in such quantities as the Representatives may from
time to time reasonably request, and, if the delivery of a prospectus is
required at any time in connection with the offering or sale of the
Securities and if at such time any event shall have occurred as a result of
which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or 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 when such Prospectus is delivered,
not misleading, or, if for any other reason it shall be necessary during
such same period to amend or supplement the Prospectus or to file under the
Exchange Act any document incorporated by reference in the Prospectus in
order to comply with the Act, the Exchange Act or the Trust Indenture Act,
to notify the Representatives and upon their request to file such document
and to prepare and furnish without charge to each Underwriter and to any
dealer in securities as many copies as the Representatives may from time to
time reasonably request of an amended Prospectus or a supplement to the
Prospectus which will correct such statement or omission or effect such
compliance;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c)
under the Act), an earnings statement of the Company and its Subsidiaries
(which need not be audited) complying with Section 11(a) of the Act and the
rules and regulations of the Commission thereunder (including, at the
option of the Company, Rule 158);
(e) During the period beginning from the date of the Pricing Agreement
for such Designated Securities and continuing to and including the later of
(i) the termination of trading restrictions for such Designated Securities,
as notified to the Company by the Representatives, and (ii) the Time of
Delivery for such Designated Securities, not to offer, sell, contract to
sell or otherwise dispose of any debt securities of the Company which
mature more than one year after such Time of Delivery and which are
substantially similar to such Designated Securities (except for bank
financings or refinancings under the Company's bank credit facility),
without the prior written consent of the Representatives; and
(f) If the Company elects to rely on Rule 462(b), the Company shall
file the Rule 462(b) Registration Statement with the Commission in
compliance with Rule 462(b) by 10:00 p.m., Washington, D.C. time, on the
date of this Agreement, and the Company shall at the time of filing either
pay to the Commission the filing fee for the Rule 462(b) Registration
Statement or give irrevocable instructions for the payment of such fee
pursuant to Rule 111(b) under the Act.
6. The Company covenants and agrees with the several Underwriters that the
Company will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of the Company's counsel and accountants in connection with the
registration of the Securities under the Act and all other expenses in
connection with the preparation, printing and filing of the Registration
Statement, any Preliminary Prospectus and the Prospectus and amendments and
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supplements thereto and the mailing and delivering of copies thereof to the
Underwriters and dealers; (ii) the cost of printing or producing any Agreement
among Underwriters, this Agreement, any Pricing Agreement, any Indenture, any
Blue Sky and Legal Investment Memoranda, closing documents (including any
compilations thereof) and any other documents in connection with the offering,
purchase, sale and delivery of the Securities; (iii) all expenses in connection
with the qualification of the Securities for offering and sale under state
securities laws as provided in Section 5(b) hereof, including the fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky and Legal Investment Surveys,
provided that such fees of counsel shall not exceed $7,500; (iv) any fees
charged by securities rating services for rating the Securities; (v) any filing
fees incident to any required review by the National Association of Securities
Dealers, Inc. of the terms of the sale of the Securities; (vi) the cost of
preparing the Securities; (vii) the fees and expenses of any Trustee and any
agent of any Trustee and the fees and disbursements of counsel for any Trustee
in connection with any Indenture and the Securities; and (viii) all other costs
and expenses incident to the performance of its obligations hereunder which are
not otherwise specifically provided for in this Section. It is understood,
however, that, except as provided in this Section, and Sections 8 and 11 hereof,
the Underwriters will pay all of their own costs and expenses, including the
fees of their counsel, transfer taxes on resale of any of the Securities by
them, and any advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters of any Designated Securities under
the Pricing Agreement relating to such Designated Securities shall be subject,
in the discretion of the Representatives, to the condition that all
representations and warranties and other statements of the Company in or
incorporated by reference in the Pricing Agreement relating to such Designated
Securities are, at and as of the Time of Delivery for such Designated
Securities, true and correct, the condition that the Company shall have
performed all of its obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) The Prospectus as amended or supplemented in relation to the
applicable Designated Securities shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed for
such filing by the rules and regulations under the Act and in accordance
with Section 5(a) hereof; if the Company has elected to rely on Rule
462(b), the Rule 462(b) Registration Statement shall have become effective
by 10:00 p.m., Washington, D.C. time on the date of this Agreement; no stop
order suspending the effectiveness of the Registration Statement or any
part thereof shall have been issued and no proceeding for that purpose
shall have been initiated or threatened by the Commission; and all requests
for additional information on the part of the Commission shall have been
complied with to the Representatives' reasonable satisfaction;
(b) Baker & Botts, L.L.P., counsel for the Underwriters, shall have
furnished to the Representatives such opinion or opinions, dated the Time
of Delivery for such Designated Securities, with respect to the matters
covered in paragraphs (i), (vi), (vii), (viii), (xi), (xii) and (xiii) of
subsection (c) below as well as such other related matters as the
Representatives may reasonably request, and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters;
(c) Albert D. Hoppe, General Counsel of the Company, shall have
furnished to the Representatives his opinion, dated the Time of Delivery
for such Designated Securities, in form and substance satisfactory to the
Representatives, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with corporate power and authority to own its properties
and conduct its business as described in the Prospectus as amended or
supplemented;
(ii) The Company has an authorized capitalization as set forth in
the Prospectus as amended or supplemented and all of the issued shares
of capital stock of the Company have been duly and validly authorized
and issued and are fully paid and non-assessable;
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(iii) The Company has been duly qualified as a foreign corporation
for the transaction of business and is in good standing under the laws
of each other jurisdiction in which it is doing business or is
otherwise required to qualify or is subject to no material liability or
disability by reason of failure to be so qualified in any such
jurisdiction;
(iv) Each Subsidiary of the Company has been duly incorporated
and is validly existing as a corporation in good standing under the
laws of its jurisdiction of incorporation; and all of the issued shares
of capital stock of each such subsidiary have been duly and validly
authorized and issued, are fully paid and non-assessable, and (except
for directors' qualifying shares) are owned directly or indirectly by
the Company, free and clear of all liens, encumbrances, equities or
claims;
(v) To the best of such counsel's knowledge and other than as
set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its Subsidiaries is
a party or of which any property of the Company or any of its
Subsidiaries is the subject which would in the aggregate have a
material adverse effect on the consolidated financial position or
operations of the Company and its Subsidiaries taken as a whole; and,
to the best of such counsel's knowledge, no such proceedings are
threatened by governmental authorities or by others;
(vi) This Agreement and the Pricing Agreement with respect to the
Designated Securities have been duly authorized, executed and delivered
by the Company;
(vii) The Designated Securities have been duly authorized,
executed, issued and delivered by the Company and, assuming due
authentication and delivery by the Trustee, constitute valid and
legally binding obligations of the Company enforceable in accordance
with their terms and entitled to the benefits provided by the
Indenture, subject, as to enforcement, to bankruptcy, insolvency,
moratorium, reorganization, fraudulent conveyance and other laws of
general applicability relating to or affecting creditors' rights and to
general equity principles; and the Designated Securities and the
Indenture conform to the descriptions thereof in the Prospectus as
amended or supplemented;
(viii) The Indenture has been duly authorized, executed and
delivered by the Company and, assuming due authorization, execution and
delivery by the Trustee, constitutes a valid and legally binding
instrument, enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, moratorium, reorganization,
fraudulent conveyance and other laws of general applicability relating
to or affecting creditors' rights and to general equity principles; and
the Indenture has been duly qualified under the Trust Indenture Act;
(ix) The issue and sale of the Designated Securities and the
compliance by the Company with all of the provisions of the Designated
Securities, the Indenture, this Agreement and the Pricing Agreement
with respect to the Designated Securities and the consummation of the
transactions herein and therein contemplated will not result in a
breach or violation of any of the terms or provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, loan agreement
or other material agreement or instrument known to such counsel to
which the Company or any of its Subsidiaries is a party or by which the
Company or any of its Subsidiaries is bound or to which any of the
property or assets of the Company or any of its Subsidiaries is
subject, nor will such actions result in any violation of the
provisions of the Certificate of Incorporation or By-laws of the
Company or any statute or any order, rule or regulation known to such
counsel of any court or governmental agency or body having jurisdiction
over the Company or any of its Subsidiaries or any of their properties;
(x) No consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body
is required for the issue and sale of the Designated
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Securities or the consummation by the Company of the transactions
contemplated by this Agreement or such Pricing Agreement or the
Indenture, except such as have been obtained under the Act and the
Trust Indenture Act and such consents, approvals, authorizations,
orders, registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Designated Securities by the Underwriters;
(xi) The statements set forth in the Prospectus as amended or
supplemented under the captions "Description of Debt Securities" and
"Description of Notes," insofar as they purport to constitute a summary
of the terms of the Securities, and under the caption "Plan of
Distribution," insofar as they purport to describe the provisions of
the laws and documents referred to therein, are accurate, complete and
fair;
(xii) The documents incorporated by reference in the Prospectus as
amended or supplemented (other than the financial statements and
related schedules and financial data derived from accounting records
included therein, as to which such counsel need express no opinion),
when they became effective or were filed with the Commission, as the
case may be, complied as to form in all material respects with the
requirements of the Act or the Exchange Act, as applicable, and the
rules and regulations of the Commission thereunder; and such counsel
has no reason to believe that any of such documents, when they became
effective or were so filed, as the case may be, contained, in the case
of a registration statement which became effective under the Act, 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, or, in the case of other documents which were
filed under the Act or the Exchange Act with the Commission, an untrue
statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in light of the
circumstances in which they were made when such documents were so
filed, not misleading; and
(xiii) The Registration Statement and the Prospectus as amended or
supplemented and any further amendments and supplements thereto made by
the Company prior to the Time of Delivery for the Designated Securities
(other than the financial statements and related schedules and
financial data derived from accounting records included therein, as to
which such counsel need express no opinion) appear on their face to
comply as to form in all material respects with the requirements of the
Act and the Trust Indenture Act and the rules and regulations
thereunder; although such counsel does not assume any responsibility
for the accuracy, completeness or fairness of the statements contained
in the Registration Statement or the Prospectus, except for those
referred to in the opinion in subsection (xi) of this Section 7(c),
such counsel has no reason to believe that, as of its effective date,
the Registration Statement or any further amendment thereto made by the
Company prior to the Time of Delivery (other than the financial
statements and related schedules and financial data derived from
accounting records included therein, as to which such counsel need
express no opinion) 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 or that, as of
its date, the Prospectus as amended or supplemented or any further
amendment or supplement thereto made by the Company prior to the Time
of Delivery (other than the financial statements and related schedules
and financial data derived from accounting records included therein, as
to which such counsel need express no opinion) contained an untrue
statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in light of the circumstances
in which they were made, not misleading or that, as of the Time of
Delivery, either the Registration Statement or the Prospectus as
amended or supplemented or any further amendment or supplement thereto
made by the Company prior to the Time of Delivery (other than the
financial statements and related schedules and financial data derived
from accounting records included therein, as to which such counsel need
express no opinion) contains an untrue statement of a material fact or
omits to state a material fact necessary to make the statements
therein, in light of the circumstances in which they were made, not
misleading;
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<PAGE>
and such counsel does not know of any amendment to the Registration
Statement required to be filed or any contracts or other documents of a
character required to be filed as an exhibit to the Registration
Statement or required to be incorporated by reference into the
Prospectus as amended or supplemented or required to be described in
the Registration Statement or the Prospectus as amended or supplemented
which are not filed or incorporated by reference or described as
required;
In giving the opinion set forth in this subsection (c), such
counsel may state that he expresses no opinion as to the laws of any
jurisdiction outside the United States; and such counsel may rely (A) as to
matters including the application of laws of any jurisdiction other than
the United States, the State of Texas and the General Corporation law of
Delaware, and as to any other matter to which you consent (which consent
shall not be unreasonably withheld), to the extent specified in such
opinion, upon the opinion of other counsel whom he believes to be reliable
(provided that such counsel shall so state in his opinion), and (B) as to
matters of fact on certificates of officers and representatives of the
Company and of public officials; and such counsel will not be required to
verify independently the accuracy or completeness of information or
documents forwarded to him with respect to the Registration Statement or
the Prospectus (or any such further amendment or supplement thereto); any
such opinions of other counsel referred to in clause (A) shall specifically
state that such opinions may be relied upon by the Underwriters and their
counsel.
(d) On the date of the Pricing Agreement for such Designated Securities
at a time prior to the execution of the Pricing Agreement with respect to
such Designated Securities and at the Time of Delivery for such Designated
Securities, PricewaterhouseCoopers LLP shall have furnished to the
Representatives a letter, dated the effective date of the Registration
Statement or the date of the most recent report filed with the Commission
containing financial statements and incorporated by reference in the
Registration Statement, if the date of such report is later than such
effective date, and a letter dated such Time of Delivery, respectively, to
the effect set forth in Annex II hereto, and with respect to such letter
dated such Time of Delivery, as to such other matters as the
Representatives may reasonably request and in form and substance
satisfactory to the Representatives;
(e) (i) Neither the Company nor any of its Subsidiaries shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus as amended or
supplemented prior to the date of the Pricing Agreement relating to the
Designated Securities any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or
from any labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Prospectus as amended or
supplemented prior to the date of the Pricing Agreement relating to the
Designated Securities, and (ii) since the respective dates as of which
information is given in the Prospectus as amended or supplemented prior to
the date of the Pricing Agreement relating to the Designated Securities
there shall not have been any change in the capital stock (other than
issuances of common stock upon exercise of options that (x) are issued
pursuant to the Company's stock option plans described in the Prospectus
and (y) were outstanding on the date of the latest balance sheet included
or incorporated by reference in the Prospectus), working capital or long-
term debt of the Company or any of its Subsidiaries or any change, or any
development involving a prospective change, in or affecting the general
affairs, management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as set forth
or contemplated in the Prospectus as amended or supplemented prior to the
date of the Pricing Agreement relating to the Designated Securities, the
effect of which, in any such case described in Clause (i) or (ii), is in
the judgment of the Representatives so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Designated Securities on the terms and in the manner
contemplated in the Prospectus as first amended or supplemented relating to
the Designated Securities;
(f) On or after the date of the Pricing Agreement relating to the
Designated Securities (i) no downgrading shall have occurred in the rating
accorded the Company's debt securities by any "nationally
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recognized statistical rating organization," as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no such
organization shall have publicly announced that it has under surveillance
or review, with possible negative implications, its rating of any of the
Company's debt securities;
(g) On or after the date of the Pricing Agreement relating to the
Designated Securities there shall not have occurred any of the following:
(i) a suspension or material limitation in trading in securities generally
on the New York Stock Exchange or on the Nasdaq Stock Market; (ii) a
suspension or material limitation in trading in the Company's securities on
the New York Stock Exchange; (iii) a general moratorium on commercial
banking activities in New York declared by either Federal or New York State
authorities; (iv) the outbreak or escalation of hostilities involving the
United States or the declaration by the United States of a national
emergency or war, if the effect of any such event specified in this Clause
(iv) in the judgment of the Representatives makes it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Designated Securities on the terms and in the manner contemplated in the
Prospectus as first amended or supplemented relating to the Designated
Securities; or (v) the occurrence of any material adverse change in the
existing financial, political or economic conditions in the United States
or elsewhere which, in the judgment of the Representatives, would
materially and adversely affect the financial markets or the market for the
Designated Securities and other debt securities; and
(h) The Company shall have furnished or caused to be furnished to the
Representatives at the Time of Delivery for the Designated Securities a
certificate or certificates of officers of the Company satisfactory to the
Representatives as to the accuracy of the representations and warranties of
the Company herein at and as of such Time of Delivery, as to the
performance by the Company of all of its obligations hereunder to be
performed at or prior to such Time of Delivery, as to the matters set forth
in subsections (a) and (e) of this Section and as to such other matters as
the Representatives may reasonably request.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter 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 an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any
amendment 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 will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating or defending any such
action or claim as such expenses are incurred; provided, however, that the
Company shall 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 an untrue statement or
alleged untrue statement or omission or alleged omission made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration Statement,
the Prospectus as amended or supplemented and any other prospectus relating to
the Securities, or any such amendment or supplement thereto in reliance upon and
in conformity with written information furnished to the Company by any
Underwriter of Designated Securities through the Representatives expressly for
use in the Prospectus as amended or supplemented relating to such Securities.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company 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 an untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus, any preliminary prospectus
supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any
amendment 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, in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged
omission was made in any Preliminary Prospectus, any preliminary prospectus
supplement, the Registration Statement,
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<PAGE>
the Prospectus as amended or supplemented and any other prospectus relating
to the Securities, or any such amendment or supplement thereto in reliance
upon and in conformity with written information furnished to the Company by
such Underwriter through the Representatives expressly for use therein; and
will reimburse the Company for any legal or other expenses reasonably
incurred by the Company in connection with investigating or defending any
such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may
have to any indemnified party otherwise than under such subsection. In case
any such action shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
shall wish, jointly with any other indemnifying party similarly notified,
to assume the defense thereof, with counsel satisfactory to such
indemnified party (who shall not, except with the consent of the
indemnified party, be counsel to the indemnifying party), and, after notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party shall not be liable to
such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by
such indemnified party, in connection with the defense thereof other than
reasonable out-of-pocket costs of investigation relating thereto. No
indemnifying party shall, without the prior written consent of the
indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action
or claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential
party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party
from all liability arising out of such action or claim and (ii) does not
include a statement as to or an admission of fault, culpability or a
failure to act by or on behalf of any indemnified party. Notwithstanding
any provision hereof to the contrary, with respect to any action or claim,
no indemnifying party shall be responsible for the fees and expenses of
more than one counsel (plus any local counsel) to the indemnified parties
in circumstances in which the indemnified parties do not have potentially
conflicting defenses available.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters of the Designated Securities on the other
from the offering of the Designated Securities to which such loss, claim,
damage or liability (or action in respect thereof) relates. If, however,
the allocation provided by the immediately preceding sentence is not
permitted by applicable law or if the indemnified party failed to give the
notice required under subsection (c) above, then each indemnifying party
shall contribute to such amount paid or payable by such indemnified party
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 the
Underwriters of the Designated Securities on the other in connection with
the statements or omissions which resulted in such losses, claims, damages
or liabilities (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative benefits received by the
Company on the one hand and such Underwriters on the other shall be deemed
to be in the same proportion as the total net proceeds from such offering
(before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by such Underwriters. The
relative fault 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 on the one hand or such Underwriters on
the other and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The Company and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this subsection (d) 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 which
does not take account of the equitable considerations referred to above in
this
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<PAGE>
subsection (d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subsection (d) shall be deemed to
include 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 subsection (d), no
Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the applicable Designated
Securities underwritten by it and distributed to the public were offered to
the public exceeds the amount of any damages which such Underwriter has
otherwise 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 Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The obligations of the Underwriters of
Designated Securities in this subsection (d) to contribute are several in
proportion to their respective underwriting obligations with respect to
such Securities and not joint.
(e) The obligations of the Company under this Section 8 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 any Underwriter within the meaning of the Act; and the obligations
of the Underwriters under this Section 8 shall be in addition to any
liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of
the Company and to each person, if any, who controls the Company within the
meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase the
Designated Securities which it has agreed to purchase under the Pricing
Agreement relating to such Designated Securities, the Representatives may in
their discretion arrange for themselves or another party or other parties to
purchase such Designated Securities on the terms contained herein. If within
thirty-six hours after such default by any Underwriter the Representatives do
not arrange for the purchase of such Designated Securities, then the Company
shall be entitled, but shall not be required, to a further period of thirty-six
hours within which to procure another party or other parties satisfactory to the
Representatives to purchase such Designated Securities on such terms. In the
event that, within the respective prescribed periods, the Representatives notify
the Company that they have so arranged for the purchase of such Designated
Securities, or the Company notifies the Representatives that it has so arranged
for the purchase of such Designated Securities, the Representatives or the
Company shall have the right to postpone the Time of Delivery for such
Designated Securities for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus as amended or supplemented, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments or supplements to the Registration Statement or the Prospectus which
in the opinion of the Representatives may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall include any person substituted
under this Section with like effect as if such person had originally been a
party to the Pricing Agreement with respect to such Designated Securities.
(b) If, after giving effect to any arrangements for the purchase of the
Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of such Designated Securities which remains
unpurchased does not exceed one-eleventh of the aggregate principal amount
of the Designated Securities, then the Company shall have the right to
require each non-defaulting Underwriter to purchase the principal amount of
Designated Securities which such Underwriter agreed to purchase under the
Pricing Agreement relating to such Designated Securities and, in addition,
to require each non-defaulting Underwriter to purchase its pro rata share
(based on the principal amount of Designated Securities which such
Underwriter agreed to purchase under such Pricing Agreement) of the
Designated Securities of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall
relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of Designated Securities which remains
unpurchased exceeds one-eleventh of the aggregate principal amount of the
Designated Securities, as referred to in subsection (b) above, or if the
Company shall not exercise the right
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<PAGE>
described in subsection (b) above to require non-defaulting Underwriters to
purchase Designated Securities of a defaulting Underwriter or Underwriters,
then the Pricing Agreement relating to such Designated Securities shall
thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the Company, except for the expenses to be borne by the
Company and the Underwriters as provided in Section 6 hereof and the
indemnity and contribution agreements in Section 8 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for its
default.
10. The respective indemnities, agreements, representations, warranties and
other statements of the Company and the several Underwriters, as set forth in
this Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Securities.
11. If any Pricing Agreement shall be terminated pursuant to Section 9
hereof, the Company shall not then be under any liability to any Underwriter
with respect to the Designated Securities covered by such Pricing Agreement
except as provided in Sections 6 and 8 hereof; but, if for any other reason
Designated Securities are not delivered by or on behalf of the Company as
provided herein, the Company will reimburse the Underwriters through the
Representatives for all out-of-pocket expenses approved in writing by the
Representatives, including fees and disbursements of counsel, reasonably
incurred by the Underwriters in making preparations for the purchase, sale and
delivery of such Designated Securities, but the Company shall then be under no
further liability to any Underwriter with respect to such Designated Securities
except as provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, the Representatives of the Underwriters of
Designated Securities shall act on behalf of each of such Underwriters, and the
parties hereto shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of any Underwriter made or given by such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Representatives as set forth in the
Pricing Agreement; and if to the Company shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth in the
Registration Statement: Attention: Corporate Secretary; provided, however, that
any notice to an Underwriter pursuant to Section 8(c) hereof shall be delivered
or sent by mail, telex or facsimile transmission to such Underwriter at its
address set forth in its Underwriters' Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement and each Pricing Agreement shall be binding upon, and
inure solely to the benefit of, the Underwriters, the Company and, to the extent
provided in Sections 8 and 10 hereof, the officers and directors of the Company
and each person who controls the Company or any Underwriter, and their
respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement or any such Pricing Agreement. No purchaser of any of the Securities
from any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
14. Time shall be of the essence of each Pricing Agreement. As used herein,
"business day" shall mean any day when the Commission's office in Washington,
D.C. is open for business.
15. THIS AGREEMENT AND EACH PRICING AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
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<PAGE>
16. This Agreement and each Pricing Agreement may be executed by any one or
more of the parties hereto and thereto in any number of counterparts, each of
which shall be deemed to be an original, but all such respective counterparts
shall together constitute one and the same instrument.
If the foregoing is in accordance with your understanding, please sign and
return to us five counterparts hereof.
Very truly yours,
Vastar Resources, Inc.
By:
-------------------------------------
Charles D. Davidson
President and Chief Executive Officer
Accepted as of the date hereof:
[Name of Underwriter(s)]
By:
------------------------------------
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<PAGE>
ANNEX I
Pricing Agreement
[Name and address of Underwriter(s)]
, 1999
Ladies and Gentlemen:
Vastar Resources, Inc., a Delaware corporation (the "Company"), proposes,
subject to the terms and conditions stated herein and in the Underwriting
Agreement, dated March 26, 1999 (the "Underwriting Agreement"), between the
Company on the one hand and [Name of Underwriter(s)] on the other hand, to issue
and sell to the Underwriters named in Schedule I hereto (the "Underwriters") the
Securities specified in Schedule II hereto (the "Designated Securities"). Each
of the provisions of the Underwriting Agreement is incorporated herein by
reference in its entirety, and shall be deemed to be a part of this Agreement to
the same extent as if such provisions had been set forth in full herein; and
each of the representations and warranties set forth therein shall be deemed to
have been made at and as of the date of this Pricing Agreement, except that each
representation and warranty which refers to the Prospectus in Section 2 of the
Underwriting Agreement shall be deemed to be a representation or warranty as of
the date of the Underwriting Agreement in relation to the Prospectus (as therein
defined), and also a representation and warranty as of the date of this Pricing
Agreement in relation to the Prospectus as amended or supplemented relating to
the Designated Securities which are the subject of this Pricing Agreement. Each
reference to the Representatives herein and in the provisions of the
Underwriting Agreement so incorporated by reference shall be deemed to refer to
you. Unless otherwise defined herein, terms defined in the Underwriting
Agreement are used herein as therein defined. The Representatives designated to
act on behalf of the Representatives and on behalf of each of the Underwriters
of the Designated Securities pursuant to Section 12 of the Underwriting
Agreement and the address of the Representatives referred to in such Section 12
are set forth at the end of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the time and place
and at the purchase price to the Underwriters set forth in Schedule II hereto,
the principal amount of Designated Securities set forth opposite the name of
such Underwriter in Schedule I hereto.
If the foregoing is in accordance with your understanding, please sign and
return to us five counterparts hereof, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding agreement between each of the Underwriters
and the Company. It is understood that your acceptance of this letter on behalf
of each of the Underwriters is or will be pursuant to the authority set forth in
a form of Agreement among
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<PAGE>
Underwriters, the form of which shall be submitted to the Company for
examination upon request, but without warranty on the part of the
Representatives as to the authority of the signers thereof.
Very truly yours,
Vastar Resources, Inc.
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
Accepted as of the date hereof:
[Name of Underwriter(s)]
By:
----------------------------------
On behalf of each of the Underwriters
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<PAGE>
SCHEDULE I
Principal
Amount of
Designated
Securities
to be
Underwriter Purchased
[Name of Underwriter(s)] $
Total $
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<PAGE>
SCHEDULE II
TITLE OF DESIGNATED SECURITIES:
[ %] [Floating Rate] [Zero Coupon] [Notes]
[Debentures] due
AGGREGATE PRINCIPAL AMOUNT:
[$]
PRICE TO PUBLIC:
% of the principal amount of the Designated Securities, plus accrued
interest[, if any,] from to [and accrued amortization[, if
any,] from to ]
PURCHASE PRICE BY UNDERWRITERS:
% of the principal amount of the Designated Securities, plus accrued
interest from to [and accrued amortization[, if any,]
from to ]
FORM OF DESIGNATED SECURITIES:
[Definitive form to be made available for checking and packaging at least
twenty-four hours prior to the Time of Delivery at the office of [The
Depository Trust Company or its designated custodian] [the
Representatives]]
[Book-entry only form represented by one or more global securities
deposited with The Depository Trust Company ("DTC") or its designated
custodian, to be made available for checking by the Representatives at
least twenty-four hours prior to the Time of Delivery at the office of
DTC.]
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
[[New York] Clearing House (next day)] [Immediately available] funds
TIME OF DELIVERY:
a.m. (New York City time), , 19
INDENTURE:
Indenture dated , 19 , between the Company and , as Trustee
MATURITY:
INTEREST RATE:
[ %] [Zero Coupon] [See Floating Rate Provisions]
INTEREST PAYMENT DATES:
[months and dates, commencing ....................., 19..]
REDEMPTION PROVISIONS:
[No provisions for redemption]
[The Designated Securities may be redeemed, otherwise than through the
sinking fund, in whole or in part at the option of the Company, in the
amount of [$ ] or an integral multiple thereof,
[on or after , at the following redemption prices (expressed in
percentages of principal amount). If [redeemed on or before , %,
and if] redeemed during the 12-month period beginning ,
Redemption
Year Price
---- -----
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<PAGE>
and thereafter at 100% of their principal amount, together in each case with
accrued interest to the redemption date.]
[on any interest payment date falling on or after , , at
the election of the Company, at a redemption price equal to the principal
amount thereof, plus accrued interest to the date of redemption.]]
[Other possible redemption provisions, such as mandatory redemption upon
occurrence of certain events or redemption for changes in tax law]
[Restriction on refunding]
SINKING FUND PROVISIONS:
[No sinking fund provisions]
[The Designated Securities are entitled to the benefit of a sinking fund to
retire [$ ] principal amount of Designated Securities on
in each of the years through at 100% of their
principal amount plus accrued interest[, together with [cumulative]
[noncumulative] redemptions at the option of the Company to retire an
additional [$ ] principal amount of Designated Securities in the
years through at 100% of their principal amount plus
accrued interest.]
[If Designated Securities are extendable debt securities, insert--
EXTENDABLE PROVISIONS:
Designated Securities are repayable on , [insert date
and years], at the option of the holder, at their principal amount with
accrued interest. The initial annual interest rate will be %, and
thereafter the annual interest rate will be adjusted on ,
and to a rate not less than % of the effective annual
interest rate on U.S. Treasury obligations with -year maturities as
of the [insert date 15 days prior to maturity date] prior to such [insert
maturity date].]
[If Designated Securities are floating rate debt securities, insert--
FLOATING RATE PROVISIONS:
Initial annual interest rate will be % through [and
thereafter will be adjusted [monthly] [on each , ,
and ] [to an annual rate of % above the average rate for
-year [month][securities][certificates of deposit] issued by and
[insert names of banks].] [and the annual interest rate [thereafter] [from
through ] will be the interest yield equivalent of the weekly
average per annum market discount rate for -month Treasury
bills plus % of Interest Differential (the excess, if any, of (i)
the then current weekly average per annum secondary market yield for
-month certificates of deposit over (ii) the then current interest yield
equivalent of the weekly average per annum market discount rate for
-month Treasury bills); [from and thereafter the rate will be the then
current interest yield equivalent plus % of Interest Differential].]
DEFEASANCE PROVISIONS:
[As described in the Prospectus.]
CLOSING LOCATION FOR DELIVERY OF DESIGNATED SECURITIES:
ADDITIONAL CLOSING CONDITIONS:
Paragraph 7(g) of the Underwriting Agreement should be modified in the
event that the Securities are denominated in, indexed to, or principal or
interest are paid in, a currency other than the U.S. dollar, more
-5-
<PAGE>
than one currency or in a composite currency. The country or countries
issuing such currency should be added to the banking moratorium and
hostilities clauses and the following additional clause should be added to
the paragraph (the entire paragraph should be restated, as amended):
"; ( ) the imposition of the proposal of exchange controls by any
governmental authority in [insert the country or countries issuing such
currency, currencies or composite currency]."
NAMES AND ADDRESSES OF REPRESENTATIVES:
Designated Representatives:
Address for Notices, etc.:
[OTHER TERMS]*:
- --------------------
* A description of particular tax, accounting or other unusual features (such as
the addition of event risk provisions) of the Designated Securities should be
set forth, or referenced to an attached and accompanying description, if
necessary, to ensure agreement as to the terms of the Designated Securities to
be purchased and sold. Such a description might appropriately be in the form
in which such features will be described in the Prospectus Supplement for the
offering.
-6-
<PAGE>
ANNEX II
Pursuant to Section 7(d) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect
to the Company and its Subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules examined by them and included or
incorporated by reference in the Registration Statement or the Prospectus
comply as to form in all material respects with the applicable accounting
requirements of the Act or the Exchange Act, as applicable, and the related
published rules and regulations thereunder; and, if applicable, they have
made a review in accordance with standards established by the American
Institute of Certified Public Accountants of the unaudited consolidated
interim financial statements, selected financial data, pro forma financial
information and/or condensed financial statements derived from audited
financial statements of the Company for the periods specified in such
letter, as indicated in their reports thereon, copies of which have been
furnished to the representative or representatives of the Underwriters (the
"Representatives") such term to include an Underwriter or Underwriters who
act without any firm being designated as its or their representatives;
(iii) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets
and consolidated statements of cash flows included in the Prospectus and/or
included in the Company's quarterly report on Form 10-Q incorporated by
reference into the Prospectus as indicated in their reports thereon copies
of which have been furnished to the Representatives; and on the basis of
specified procedures including inquiries of officials of the Company who
have responsibility for financial and accounting matters regarding whether
the unaudited condensed consolidated financial statements referred to in
paragraph (vi)(A)(i) below comply as to form in all material respects with
the applicable accounting requirements of the Act and the Exchange Act and
the related published rules and regulations, nothing came to their
attention that caused them to believe that the unaudited condensed
consolidated financial statements do not comply as to form in all material
respects with the applicable accounting requirements of the Act and the
Exchange Act and the related published rules and regulations;
(iv) The unaudited selected financial information with respect to the
results of operations and financial position of the Company for the five
most recent fiscal years included in the Prospectus and included or
incorporated by reference in Item 6 of the Company's Annual Report on Form
10-K for the most recent fiscal year agrees with the corresponding amounts
(after restatement where applicable) in the audited financial statements
for five such fiscal years which were included or incorporated by reference
in the Company's Annual Reports on Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and on
the basis of limited procedures specified in such letter nothing came to
their attention as a result of the foregoing procedures that caused them to
believe that this information does not conform in all material respects
with the disclosure requirements of Items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its Subsidiaries, inspection of the
minute books of the Company and its Subsidiaries since the date of the
latest audited financial statements included or incorporated by reference
in the Prospectus, inquiries of officials
-1-
<PAGE>
of the Company and its Subsidiaries responsible for financial and
accounting matters and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention that caused them
to believe that:
(A) (i) the unaudited interim consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus and/or included or incorporated by reference
in the Company's Quarterly Reports on Form 10-Q incorporated by
reference in the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the Exchange
Act and the related published rules and regulations, or (ii) any
material modifications should be made to the unaudited interim
statements of income, consolidated balance sheets and consolidated
statements of cash flows included in the Prospectus or included in the
Company's Quarterly Reports on Form 10-Q incorporated by reference in
the Prospectus for them to be in conformity with generally accepted
accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited interim consolidated financial statements from
which such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited combined financial
statements included or incorporated by reference in the Prospectus;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited income
statement data and balance sheet items included in the Prospectus and
referred to in Clause (B) were not determined on a basis substantially
consistent with the basis for the audited financial statements included
or incorporated by reference in the Prospectus;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of those
statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the consolidated
capital stock (other than issuances of capital stock upon exercise of
options and stock appreciation rights, upon earn-outs of performance
shares and upon conversions of convertible securities, in each case
which were outstanding on the date of the latest balance sheet included
or incorporated by reference in the Prospectus) or any increase in the
consolidated long-term debt of the Company and its subsidiaries, or any
decreases in consolidated net current assets or consolidated
stockholders' equity or other items specified by the Representatives,
or any increases in any items specified by the Representatives, in each
case as compared with amounts shown in the latest balance sheet
included or incorporated by reference in the Prospectus, except in each
case for changes, increases or decreases which the Prospectus discloses
have occurred or may occur or which are described in such letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in Clause (E) there were any decreases
in consolidated sales or other operating revenues or operating profit
or the total or per share amounts of consolidated net income or other
items specified by the Representatives, or any increases in any items
specified by the Representatives, in each case as compared with the
comparable period of the preceding year and with any other period of
corresponding length specified by the
-2-
<PAGE>
Representatives, except in each case for increases or decreases which
the Prospectus discloses have occurred or may occur or which are
described in such letter; and
(vii) In addition to the examination referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures
referred to in paragraphs (iii) and (vi) above, they have carried out
certain specified procedures, not constituting an examination in accordance
with generally accepted auditing standards, with respect to certain
amounts, percentages and financial information specified by the
Representatives which are derived from the general accounting records of
the Company and its subsidiaries, which appear in the Prospectus (excluding
documents incorporated by reference), or in Part II of, or in exhibits and
schedules to, the Registration Statement specified by the Representatives
or in documents incorporated by reference in the Prospectus specified by
the Representatives, and have compared certain of such amounts, percentages
and financial information with the accounting records of the Company and
its Subsidiaries and have found them to be in agreement.
All references in this Annex II to the Prospectus shall be deemed to refer
to the Prospectus (including the documents incorporated by reference therein) as
defined in the Underwriting Agreement as of the date of the letter delivered on
the date of the Pricing Agreement for purposes of such letter and to the
Prospectus as amended or supplemented (including the documents incorporated by
reference therein) in relation to the applicable Designated Securities for
purposes of the letter delivered at the Time of Delivery for such Designated
Securities.
-3-
<PAGE>
[LETTERHEAD VASTAR RESOURCES, INC. APPEARS HERE]
EXHIBIT 5
May 27, 1999
Board of Directors
Vastar Resources, Inc.
15375 Memorial Drive
Houston, Texas 77079
OPINION OF COUNSEL
As Vice President, General Counsel and Secretary of Vastar Resources, Inc.
(the "Company"), I have acted as counsel for the Company in connection with
its Registration Statement on Form S-3 (the "Registration Statement") relating
to the registration under the Securities Act of 1933 of the offering and sale
from time to time of up to $300,000,000 aggregate principal amount (subject to
increase as indicated on the front cover page of the Registration Statement)
of debt securities (the "Securities").
As the basis for the opinion hereinafter expressed, I have examined such
statutes, regulations, the indenture relating to the Securities (the
"Indenture"), records and documents, certificates of corporate and public
officials and other instruments as I have deemed necessary or advisable for the
purposes of this opinion. In such examination I have assumed the authenticity of
all documents submitted to me as originals and the conformity with the original
documents of all documents submitted to me as copies.
Based on the foregoing, certain consultations with officers, employees and
agents of the Company and on such legal considerations as I deem relevant, I
am of the opinion that the Securities have been duly and validly authorized by
all necessary corporate action by the Company and, when executed and
authenticated as specified in the Indenture and delivered, against payment
therefor, will constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, and be
entitled to the benefit of the Indenture, except to the extent the
enforceability thereof may be limited by (i) the exercise of judicial
discretion in accordance with general equitable principles; (ii) laws relating
to the bankruptcy, insolvency, moratorium, reorganization, fraudulent
conveyance or similar laws affecting creditors' rights generally; and (iii)
the extent to which certain equitable remedies, including specific
performance, may be unavailable.
I am licensed to practice law in the States of Colorado, Missouri and Texas
and the opinions set forth above are based upon and limited to the laws of
such states, as they may be applicable, and of the United States and a reading
of the General Corporation Law of the State of Delaware.
I hereby consent to the use of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Albert D. Hoppe
<PAGE>
EXHIBIT 12
VASTAR RESOURCES, INC.
STATEMENT SETTING FORTH DETAIL OF COMPUTATION OF
RATIO OF EARNINGS TO FIXED CHARGES
(Unaudited)
<TABLE>
<CAPTION>
For the
three months
ended
March 31, For the years ended December 31,
------------ ----------------------------------
1999 1998 1997 1996 1995 1994
------------ ------ ------ ------ ------ ------
(in millions)
<S> <C> <C> <C> <C> <C> <C>
Income from continuing
operations before income
taxes, minority interest and
cumulative effect of change in
accounting principle(1)....... $(5.4) $ 51.2 $234.6 $212.7 $ 56.2 $153.6
Fixed charges:
Interest expense charged to
income, and portion of
rental representative of
interest(2)................. 21.6 63.5 47.8 52.3 57.0 66.3
Capitalized interest........... -- -- -- -- -- --
------ ------ ------ ------ ------ ------
Total fixed charges........ $21.6 $ 63.5 $ 47.8 $ 52.3 $ 57.0 $ 66.3
------ ------ ------ ------ ------ ------
Earnings (1) + (2)............. $16.2 $114.7 $282.4 $265.0 $113.2 $219.9
====== ====== ====== ====== ====== ======
Ratio of earnings to fixed
charges....................... 0.75 1.81 5.91 5.07 1.99 3.32
====== ====== ====== ====== ====== ======
</TABLE>
The Company has never issued preferred stock.
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of our report dated February 22, 1999 relating to the
financial statements, which appears in Vastar Resources, Inc.'s Annual Report on
Form 10-K for the year ended December 31, 1998. We also consent to the
references to us under the heading "Experts" in such Registration Statement.
/s/ PricewaterhouseCoopers LLP
Houston, Texas
May 26, 1999
<PAGE>
[LETTERHEAD OF RYDER SCOTT COMPANY APPEARS HERE]
EXHIBIT 23.3
CONSENT OF RYDER SCOTT COMPANY
We consent to the inclusion in this Registration Statement on Form S-3 of
our report dated January 14, 1999, on our audit of the remaining proved
reserves attributable to the properties owned by Vastar Resources, Inc. (the
"Company") as of December 31, 1998, included in the Company's Annual Report on
Form 10-K for the year ended December 31, 1998 and all references, if any, to
our firm included in this Registration Statement.
/s/ Ryder Scott Company Petroleum
Engineers
RYDER SCOTT COMPANY
PETROLEUM ENGINEERS
Houston, Texas
May 25, 1999
<PAGE>
EXHIBIT 25
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________________________________
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
Check if an Application to Determine Eligibility of a trustee Pursuant to
Section 305(b) ____
HARRIS TRUST AND SAVINGS BANK
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)
Illinois 16-1194448
(JURISDICTION OF INCORPORATION OR ORGANIZATION (I.R.S. EMPLOYER
IF NOT A U.S. NATIONAL BANK) IDENTIFICATION NUMBER)
111 West Monroe Street
Chicago, Illinois 60603
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
Mark F. McLaughlin
Harris Trust and Savings Bank
111 West Monroe Street, Chicago, Illinois
(312) 461-2531
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
____________________________________
VASTAR RESOURCES, INC.
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
Delaware 95-4446177
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
15375 Memorial Drive
Houston, Texas 77079
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
______________________________________
__% Senior Notes due ___
(Title of Indenture Securities)
================================================================================
<PAGE>
1. GENERAL INFORMATION.
Furnish the following information as to the Trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
Commissioner of Banks and Trust Companies, State of Illinois,
Springfield, Illinois; Chicago Clearing House Association, 164 West
Jackson Boulevard, Chicago, Illinois; Federal Deposit Insurance
Corporation, Washington, D.C.; The Board of Governors of the
Federal Reserve System, Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Harris Trust and Savings Bank is authorized to exercise corporate
trust powers.
2. AFFILIATIONS WITH OBLIGOR.
If the Obligor is an affiliate of the Trustee, describe each such
affiliation.
The Obligor is not an affiliate of the Trustee.
3. through 15.
NO RESPONSE NECESSARY
16. LIST OF EXHIBITS.
1. A copy of the articles of association of the Trustee is now in effect
which includes the authority of the trustee to commence business and to
exercise corporate trust powers.
A copy of the Certificate of Merger dated April 1, 1972 between Harris Trust
and Savings Bank, HTS Bank and Harris Bankcorp, Inc. which constitutes
the articles of association of the Trustee as now in effect and
includes the authority of the Trustee to commence business and to
exercise corporate trust powers was filed in connection with the
Registration Statement of Louisville Gas and Electric Company, File No.
2-44295, and is incorporated herein by reference.
2. A copy of the existing by-laws of the Trustee.
A copy of the existing by-laws of the Trustee was filed in connection
with the Registration Statement of Commercial Federal Corporation, File
No. 333-20711, and is incorporated herein by reference.
3. The consents of the Trustee required by Section 321(b) of the Act.
(included as Exhibit A on page 3 of this statement)
4. A copy of the latest report of condition of the Trustee published pursuant
to law or the requirements of its supervising or examining authority.
(included as Exhibit B on page 4 of this statement)
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the Trustee,
HARRIS TRUST AND SAVINGS BANK, a corporation organized and existing under the
laws of the State of Illinois, has duly caused this statement of eligibility to
be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago, and State of Illinois, on the 24th day of May, 1999.
HARRIS TRUST AND SAVINGS BANK
By: /S/ AMY ROBERTS
-------------------------
Amy Roberts
Vice President
2
<PAGE>
EXHIBIT A
The consents of the trustee required by Section 321(b) of the Act.
Harris Trust and Savings Bank, as the Trustee herein named, hereby consents
that reports of examinations of said trustee by Federal and State
authorities may be furnished by such authorities to the Securities and
Exchange Commission upon request therefor.
HARRIS TRUST AND SAVINGS BANK
By: /S/ AMY ROBERTS
-------------------------
Amy Roberts
Vice President
3
<PAGE>
EXHIBIT B
Attached is a true and correct copy of the statement of condition of Harris
Trust and Savings Bank as of June 30, 1998, as published in accordance with a
call made by the State Banking Authority and by the Federal Reserve Bank of the
Seventh Reserve District.
[LOGO APPEARS HERE] HARRIS BANK
Harris Trust and Savings Bank
111 West Monroe Street
Chicago, Illinois 60603
of Chicago, Illinois, And Foreign and Domestic Subsidiaries, at the close of
business on June 30, 1998, a state banking institution organized and operating
under the banking laws of this State and a member of the Federal Reserve System.
Published in accordance with a call made by the Commissioner of Banks and Trust
Companies of the State of Illinois and by the Federal Reserve Bank of this
District.
Bank's Transit Number 71000288
<TABLE>
<CAPTION>
THOUSANDS
ASSETS OF DOLLARS
Cash and balances due from depository institutions:
<S> <C> <C>
Non-interest bearing balances and currency and coin..................... $ 1,417,965
Interest bearing balances............................................... $ 303,574
Securities:....................................................................
a. Held-to-maturity securities $ 0
b. Available-for-sale securities $ 4,490,777
Federal funds sold and securities purchased under agreements to resell $ 263,100
Loans and lease financing receivables:
Loans and leases, net of unearned income................................ $ 9,238,306
LESS: Allowance for loan and lease losses.............................. $ 103,410
-----------
Loans and leases, net of unearned income, allowance, and reserve
(item 4.a minus 4.b).................................................... $ 9,134,896
Assets held in trading accounts................................................ $ 192,782
Premises and fixed assets (including capitalized leases)....................... $ 230,242
Other real estate owned........................................................ $ 244
Investments in unconsolidated subsidiaries and associated companies............ $ 23
Customer's liability to this bank on acceptances outstanding................... $ 39,065
Intangible assets.............................................................. $ 262,703
Other assets................................................................... $ 1,090,011
-----------
TOTAL ASSETS $17,425,382
===========
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES
Deposits:
<S> <C> <C>
In domestic offices.......................................................... $ 9,411,411
Non-interest bearing.................................................... $ 3,093,738
Interest bearing........................................................ $ 6,317,673
In foreign offices, Edge and Agreement subsidiaries, and IBF's............... $ 1,501,440
Non-interest bearing.................................................... $ 33,412
Interest bearing........................................................ $ 1,468,028
Federal funds purchased and securities sold under agreements to repurchase in
domestic offices of the bank and of its Edge and Agreement subsidiaries, and
in IBF's:
Federal funds purchased & securities sold under agreements to repurchase....... $ 3,465,000
Trading Liabilities 83,843
Other borrowed money:..........................................................
a. With remaining maturity of one year or less $ 1,016,061
b. With remaining maturity of more than one year $ 0
Bank's liability on acceptances executed and outstanding $ 39,065
Subordinated notes and debentures.............................................. $ 225,000
Other liabilities.............................................................. $ 408,338
TOTAL LIABILITIES $16,150,158
===========
EQUITY CAPITAL
Common stock................................................................... $ 100,000
Surplus........................................................................ $ 601,594
a. Undivided profits and capital reserves..................................... $ 562,502
b. Net unrealized holding gains (losses) on available-for-sale securities $ 11,128
TOTAL EQUITY CAPITAL $ 1,275,224
===========
Total liabilities, limited-life preferred stock, and equity capital............ $17,425,382
===========
</TABLE>
I, Pamela Piarowski, Vice President of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the Board of Governors of the Federal Reserve System and
is true to the best of my knowledge and belief.
PAMELA PIAROWSKI
7/30/98
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and, to the best of our
knowledge and belief, has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and the
Commissioner of Banks and Trust Companies of the State of Illinois and is true
and correct.
EDWARD W. LYMAN,
ALAN G. McNALLY,
RICHARD E. TERRY
Directors.
5
