Anadarko Petroleum Corporation 6 1/8% Notes Due 2012 Terms Agreement with Salomon Smith Barney Inc.

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Summary

Anadarko Petroleum Corporation has agreed to sell $400 million in 6 1/8% Notes due 2012 to Salomon Smith Barney Inc. under the terms of an existing Underwriting Agreement. The notes mature on March 15, 2012, and pay interest semi-annually. The agreement includes provisions for early redemption with a make-whole premium, no sinking fund, and no conversion rights. The offering price is 98.698% of principal, and the purchase price is 98.048%. The agreement also amends certain terms of the Underwriting Agreement, including conditions related to credit ratings and market disruptions.

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EX-1.1 3 h94829ex1-1.txt TERMS AGREEMENT DATED 3/5/2002 EXHIBIT 1.1 ANADARKO PETROLEUM CORPORATION DEBT SECURITIES TERMS AGREEMENT Dated: March 5, 2002 To: Anadarko Petroleum Corporation 17001 Northchase Drive Houston, Texas 77060 Attention: Vice President and Treasurer Re: Underwriting Agreement (Standard Provisions) Debt Securities 2001 Title of Securities: 6 1/8% Notes due 2012 Indenture: Dated as of March 9, 2001 between Anadarko Petroleum Corporation (the "Company") and The Bank of New York Principal amount to be issued: $400,000,000 Current ratings: Baa1/BBB+ Interest rate: Payable: March 15 and September 15 beginning September 15, 2002 Date of maturity: March 15, 2012 Public offering price: 98.698% Purchase price: 98.048% Specified funds for payment of purchase price: Same day DTC funds Closing date and location: March 8, 2002 in the City of New York Lock-up Period: None Additional co-managers, if any: None Subject to the terms and provisions of the above referenced Underwriting Agreement, which is incorporated herein in its entirety and made a part hereof to the same extent as if such terms and provisions had been set forth in full herein, the Company agrees to sell and Salomon Smith Barney Inc. agrees to purchase the principal amount of Firm Securities set forth opposite its name.
NAME PRINCIPAL AMOUNT ---- ---------------- Salomon Smith Barney Inc. $400,000,000 Redemption provisions: The Company may redeem the Securities prior to maturity, in whole or in part, at a redemption price equal to the sum of 100% of the principal amount, plus accrued interest to the redemption date, plus a make-whole premium. The make-whole premium is based on the present values of interest and principal payments that, but for the redemption, would have been payable, discounted at a rate equal to the Treasury Yield (as defined in the prospectus supplement) plus 20 basis points. Sinking fund requirements: None Conversion provisions: None Initial conversion price: N/A Initial conversion date: N/A Final conversion date: N/A Delivery date: N/A Minimum Contract: N/A Maximum aggregate principal amount: Fee: 65 basis points
2 Other terms: Salomon Smith Barney Inc. will reimburse the Company for certain expenses so that the all-in cost of this offering will not exceed an annualized rate of 6.3398%. Section 4 of the Underwriting Agreement is hereby amended by adding the following section: "(f) At the applicable Closing Time, there shall not have been any downgrading from the ratings specified in the Terms Agreement of any debt securities of the Company by any `nationally recognized statistical rating organization' (as defined for purposes of Rule 436(g) under the Act), or any public announcement that any such organization has under surveillance or review its rating of any debt securities of the Company (other than an announcement with positive implications of a possible upgrading, and no implication of a possible downgrading, of such rating)." Section 8 of the Underwriting Agreement is hereby amended as follows: 1. Replace the words "any new outbreak of hostilities" in the second sentence with the words "any attack on, outbreak or escalation of hostilities or act of terrorism involving the United States, any declaration of war by Congress". 2. Add the words at the end of the second sentence "or (iii) any major disruption of settlements of securities or clearance services in the United States." [The remainder of this page is intentionally left blank] 3 SALOMON SMITH BARNEY INC. By /s/ J.P. BUYZE --------------------------------------- Address for Notices: 338 Greenwich Street, 34th Floor New York, New York 10013 Accepted: ANADARKO PETROLEUM CORPORATION By /s/ AL RICHEY ------------------------------------ Title: Vice President and Treasurer 4