SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (date of earliest event reported)
NOVEMBER 24, 1998
Halliburton Company
(Exact name of registrant as specified in its charter)
State or other Commission IRS Employer
jurisdiction File Number Identification
of incorporation Number
Delaware 1-3492 No. 75-2677995
3600 Lincoln Plaza
500 North Akard Street
Dallas, Texas 75201-3391
(Address of principal executive offices)
Registrant's telephone number,
including area code - 214/978-2600
Page 1 of 27 Pages
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INFORMATION TO BE INCLUDED IN REPORT
Item 5. Other Events
The registrant may, at its option, report under this item any events,
with respect to which information is not otherwise called for by this form, that
the registrant deems of importance to security holders.
In connection with the offering, sale and delivery by Registrant of
$150 million principal amount Registrant's 5 5/8% Notes due December 1, 2008
(the "Notes") on November 24, 1998, Registrant is filing herewith as exhibits
the final copy of the Terms Agreement and the form of Note. The offering, sale
and delivery of the Notes, which constitute a part of Registrant's Medium Term
Notes Due Nine Months or More From Date of Issue, Series A, have been registered
pursuant to the registration provisions of the Securities Act of 1933, as
amended, by virtue of Registrant's Registration Statement on Form S-3 (File No.
33-65772) which, as amended by Post-effective Amendment No. 2, became effective
on December 19, 1996.
Item 7. Financial Statements and Exhibits
List below the financial statements, pro forma financial information
and exhibits, if any, filed as part of this report.
(c) Exhibits.
Exhibit 1.1 - Terms Agreement dated November 19, 1998 between
Halliburton Company and Merrill Lynch, Pierce, Fenner & Smith
Incorporated and the other agents signatory thereto.
Exhibit 4.1 - Form of Note.
Page 2 of 27 Pages
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HALLIBURTON COMPANY
Date: December 18, 1998 By: /s/ Susan S. Keith
---------------------------
Susan S. Keith
Vice President, Secretary and
Corporate Counsel
Page 3 of 27 Pages
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EXHIBIT INDEX
Exhibit Sequentially
Number Description Numbered Page
1.1 Terms Agreement 5 of 27
4.1 Form of Note 16 of 27
Page 4 of 27 Pages
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Exhibit 1.1
HALLIBURTON COMPANY
Medium-Term Notes
Due 9 Months or More from Date of Issue
TERMS AGREEMENT
November 19, 1998
Halliburton Company
3600 Lincoln Plaza
500 N. Akard Street
Dallas, Texas 75201-3391
Attention: Vice President and Secretary
Subject in all respects to the terms and conditions of the Distribution
Agreement dated January 13, 1997 among Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated, Lehman Brothers Inc., Morgan Stanley & Co.
Incorporated, NationsBanc Capital Markets, Inc. and you (the "Agreement"), the
undersigned (collectively, the "Purchasers") agree to purchase the Notes
described below of Halliburton Company (the "Company").
THE NOTES
Aggregate Principal Amount: $150,000,000
Purchase Price: 99.326% of Principal Amount
Priority: Senior
Issue Price: 99.976% of Principal Amount
Currency or Currency Unit: United States Dollars
Interest Rate or 5-5/8% per annuam, accruing
Method of Determining: from November 24, 1998
Page 5 of 27 Pages
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Date of Maturity: December 1, 2008
Interest Payment Dates: December 1 and June 1 of each
year, except as provided in
the Pricing Supplement
Closing Date: November 24, 1998
Method of Payment: Immediately available funds
Trustee: Texas Commerce Bank, National
Association
Registrar, Paying Agent The Chase Manhattan Bank
and Authenticating Agent: (National Association)
Modification, if any, Each of the documents
in the requirements to specified in Sections 7(b),
deliver the documents (c) and (d)of the Agreement
specified in Sections shall be dated as of, and
7 (b) , (c) and (d) of delivered to the undersigned
the Agreement: on, the Closing Date
Other terms: The Notes shall have such
additional terms as are
specified in the form of
Pricing Supplement, attached
hereto as Annex A
Allocation among Each of the purchasers
Purchasers: severally agrees to purchase
the respective principal
amount of Notes set forth
next to its name in Annex B
Default of Purchasers: The provisions set forth in
Annex-C hereto are
incorporated herein by
reference
Page 6 of 27 Pages
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MERRILL LYNCH,
PIERCE, FENNE &
SMITH INCORPORATED
LEHMAN BROTHERS INC.
MORGAN STANLEY &
CO. INCORPORATED
By: Merrill Lynch, Pierce,
Fenner & Smith Incorporated
By:
--------------------------
Title:
Accepted:
HALLIBURTON COMPANY
By: /s/ Lester L. Coleman
---------------------
Page 7 of 27 Pages
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ANNEX A
PRICING SUPPLEMENT
(To prospectus dated December 19, 1996 and
prospectus supplement dated August 1, 1997)
$150,000,000
5 5/8 % Notes Due December 1, 2008
The notes bear interest at a rate of 5 5/8% per year. Interest on the notes
is payable on June 1 and December 1 of each year, commencing June 1, 1999. The
notes will mature on December 1, 2008.
The notes will be redeemable prior to maturity, in whole or in part, as
described in this pricing supplement. The notes do not have the benefit of any
sinking fund.
The notes will be issued in book entry form through the facilities of The
Depository Trust Company in minimum denominations of $1,000 and integral
multiples thereof. We do not intend to list the notes on any securities
exchange.
Investing in the notes involves risks which are described in the "Risk
Factors" section beginining on page S-2 of the accompanying Prospectus
Supplement.
Price to Underwriting Proceeds to
------------ ------------ -----------
Public Discount Halliburton Company
------ -------- -------------------
Per Note (1).... 99.976% .65% 99.326%
Total........... $149,964,000 $975,000 $148,989,000
(1) Purchasers will also be required to pay accrued interest from November
24, 1998, if settlement occurs after that date.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
pricing supplement and the accompanying prospectus supplement and prospectus are
truthful or complete. Any representation to the contrary is a criminal offense.
We expect that the notes will be ready for delivery in New York, New York,
on or about November 24, 1998.
Merrill Lynch & Co.
Lehman Brothers
---------------
Morgan Stanley Dean Witter
The date of this pricing supplement is November 19, 1998.
Page 8 of 27 Pages
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TABLE OF CONTENTS
Pricing Supplement
Page
----
Recent Developments.......................................... PS-3
Use of Proceeds.............................................. PS-3
Ratio of Earnings to Fixed Charges........................... PS-4
Certain Terms of the Notes................................... PS-4
Supplemental Plan of Distribution............................ PS-5
Prospectus Supplement
Risk Factors................................................. S-2
Description of Notes......................................... S-4
Certain United States Federal Income Tax Considerations...... S-19
Plan of Distribution......................................... S-26
Prospectus
Available Information........................................ 2
Incorporation of Certain Documents By Reference.............. 3
The Company.................................................. 4
Use of Proceeds.............................................. 5
Ratio of Earnings to Fixed Charges........................... 5
Description of Debt Securities............................... 5
Description of Capital Stock................................. 15
Distribution................................................. 18
Legal Matters................................................ 18
Experts...................................................... 18
No dealer, salesperson or other person is authorized to give any
information or to represent anything not contained in this pricing supplement or
the accompanying prospectus supplement and prospectus. You must not rely on any
unauthorized information or representations. This pricing supplement and the
accompanying prospectus supplement and prospectus is an offer to sell or to buy
only the notes offered hereby, but only under circumstances and in jurisdictions
where it is lawful to do so. The information contained in this pricing
supplement is current only as of the date hereof.
Page 9 of 27 Pages
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RECENT DEVELOPMENTS
Acquisition of Dresser Industries, Inc.
On September 29, 1998, the Company completed the acquisition of Dresser
Industries, Inc. ("Dresser") pursuant to the Agreement and Plan of Merger dated
as of February 25, 1998 by and among the Company, Halliburton N.C., Inc., a
wholly owned direct subsidiary of Halliburton ("Merger Sub"), and Dresser (the
"Merger Agreement"). Pursuant to the Merger Agreement, Merger Sub was merged
(the "Merger") with and into Dresser, with Dresser surviving as a subsidiary of
the Company. In the aggregate, the Company issued approximately 176 million
shares of Common Stock in the Merger. In addition, as part of the Merger,
Halliburton is reserving approximately 7.3 million shares of Common Stock in
exchange for certain rights relating to Dresser's employee and directors plans.
The Company sold its 36% ownership interest in M-I L.L.C. ("M-I") to Smith
International, Inc. ("Smith") on August 31, 1998. This transaction completed the
Company's commitment to the United States Department of Justice ("DOJ") to sell
its M-I interest in connection with the Merger. The purchase price of $265
million was paid by Smith in the form of a non-interest bearing promissory note
due 240 days from the date of the closing. All of M-I's debt remains an
obligation of M-I. In connection with the Merger, the Company entered into a
consent decree with the DOJ requiring divestiture of the Company's current
worldwide logging-while-drilling ("LWD") business. In 1997 the affected business
had revenues of less than $50 million, or approximately 0.4% of the combined
revenues of the Company and Dresser. The Company's existing directional drilling
service line and Dresser's Sperry-Sun division are not impacted by the decree.
While the Company agreed in the consent decree to divest one-half of its sonic
LWD tools, it will continue to provide customers with sonic LWD services using
its existing sonic technologies. The consent decree requires the Company to
divest such LWD business by March 28, 1999.
Dresser, which was previously publicly traded, is a leading global supplier
to the total hydrocarbon energy stream. Dresser's product and service offerings
encompass sophisticated drilling and well construction systems as well as
technologies, engineered equipment and project management for the transportation
and conversion of oil and natural gas. The Company currently intends to continue
Dresser's business activities.
Results of Operations
Before recognition of special charges, the Company earned $195 million
($0.44 per share of Common Stock on a fully diluted basis) in the quarter ended
September 30, 1998 as compared to $218 million ($0.50 per share of Common Stock
on a fully diluted basis) in the quarter ended September 30, 1997. FInancial
results for both years have been restated to reflect the combined results of
operation of the Company and Dresser on a pooling of interests basis. Revenues
for the third quarter of 1998 were $4,224 million, approximately one percent
greater than the $4,177 million in revenues of the combined companies in the
third quarter of 1997.
The results of operations of the Company for the third quarter of 1998
include a special charge of $945 million ($722 million after tax or $1.64 per
share of Common Stock on a fully diluted basis) to provide for consolidation,
restructuring and merger related expenses. Components of the special charge
include $509 million of asset related writeoffs, writedowns and charges; $205
million related to personnel reduction costs; $121 million of facility
consolidation charges; $64 million of merger transaction costs; and $46 million
of other merger related costs.
After the special charge, the Company reported a net loss for the third
quarter of 1998 of $527 million or $1.20 per share of Common Stock on a fully
diluted basis.
Page 10 of 27 Pages
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USE OF PROCEEDS
The net proceeds from the sale of the notes offered hereby will be added to
the Company's general funds and used for general corporate purposes, which may
include repayment of debt, acquisitions by the Company and loans and advances
to, and investments in, subsidiaries of the Company to provide funds for working
capital, repayment of debt and capital expenditures. Until the net proceeds are
utilized, it is expected that such net proceeds will be placed in interest
bearing time deposits or invested in short-term marketable securities.
RATIO OF EARNINGS TO FIXED CHARGES (a)
Nine Months
Ended
Years Ended December 31, September 30,
---------------------------------------------- -------------
1993 1994 1995 1996 1997 1998
------ ------ ------ ------ ------ ------
1.1 6.3 5.6 6.3 8.0 1.2
(a) Includes the effect of the acquisition of Dresser on September 29, 1998,
which was accounted for as a pooling of interests. Historical restated
financial statements have been issued and filed with the Securities and
Exchange Commission in a Current Report on Form 8-K/A dated September 29,
1998.
For purposes of computing the ratio of earnings to fixed charges: (i) fixed
charges consist of interest on debt (whether expensed or capitalized),
amortization of debt discount and expense and a portion of rental expense
determined to be representative of interest and (ii) earnings consist of income
(loss) from continuing operations before provision for income taxes, minority
interest, cumulative effects of accounting changes and extraordinary items plus
fixed charges as described above, adjusted to exclude capitalized interest and
by the excess or deficiency of dividends over income of 50 percent or less owned
entities accounted for by the equity method.
CERTAIN TERMS OF THE NOTES
The following description of the particular terms of the notes offered
hereby supplements, and to the extent inconsistent therewith, replaces, the
description of the general terms and provisions of the Medium-Term Notes as set
forth and described in the accompanying prospectus and prospectus supplement, to
which description reference is hereby made.
General
The notes are Fixed Rate Notes (as defined in the accompanying prospectus
supplement) and are part of a series of Medium-Term Notes Due Nine Months or
More From Date of Issue, Series A, of the Company described in the accompanying
prospectus and prospectus supplement. The notes will bear interest at the rate
per annum shown on the cover page of this pricing supplement from November 24,
1998, or from the most recent date to which interest has been paid. Interest
will be payable semiannually on June 1 and December 1 of each year (each, an
"Interest Payment Date"), commencing on June 1, 1999, to the persons in whose
names the notes are registered at the close of business on the fifteenth
calendar day (whether or not a Business Day, as defined in the accompanying
prospectus supplement) immediately preceding such Interest Payment Date.
Interest payable at maturity will be payable to the person to whom principal
shall be payable. The notes will mature on December 1, 2008, and will be subject
to redemption at the option of the Company prior to maturity.
The notes will be issued in book-entry form through the facilities of The
Depository Trust Company in minimum denominations of $1,000 and integral
multiples thereof.
Page 11 of 27 Pages
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Redemption
The notes will be redeemable as a whole or in part, at the option of the
Company at any time, at a redemption price equal to the greater of (i) 100% of
the principal amount of such notes and (ii) the sum of the present values of the
remaining scheduled payments of principal and interest thereon discounted to the
redemption date on a semiannual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Treasury Rate plus 15 basis points, plus in each
case accrued interest thereon to the date of redemption.
"Treasury Rate" means, with respect to any redemption date, the rate per
annum equal to the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as
a percentage of its principal amount) equal to the Comparable Treasury Price for
such redemption date.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity comparable to
the remaining term of the notes to be redeemed that would be utilized, at the
time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of a comparable maturity to the
remaining term of such notes. "Independent Investment Banker" means one of the
Reference Treasury Dealers appointed by the Trustee after consultation with the
Company.
"Comparable Treasury Price" means, with respect to any redemption date, (A)
the average of the Reference Treasury Dealer Quotations for such redemption
date, after excluding the highest and lowest such Reference Treasury Dealer
Quotations, or (B) if the Trustee obtains fewer than four such Reference
Treasury Dealer Quotations, the average of all such quotations. "Reference
Treasury Dealer Quotations" means, with respect to each Reference Treasury
Dealer and any redemption date, the average, as determined by the Trustee, of
the bid and asked prices for the Comparable Treasury Issue (expressed in each
case as a percentage of its principal amount) quoted in writing to the Trustee
by such Reference Treasury Dealer at 3:30 p.m. New York time on the third
business day preceding such redemption date.
"Reference Treasury Dealer" means each of Goldman, Sachs & Co., Lehman
Brothers Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan
Stanley & Co. Incorporated and Salomon Smith Barney Inc. and their respective
successors; provided, however, that if any of the foregoing or their affiliates
shall cease to be a primary U.S. Government securities dealer in The City of New
York (a "Primary Treasury Dealer"), the Company shall substitute therefor
another Primary Treasury Dealer.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each holder of notes to be redeemed.
Unless the Company defaults in payment of the redemption price, on and
after the redemption date interest will cease to accrue on the notes or portions
thereof called for redemption.
All questions regarding the validity, form, eligibility (including time of
receipt) and acceptance of any Note for repayment will be determined by the
Company, whose determination will be final and binding.
For further information regarding the terms of the notes, see "Description
of Notes" in the accompanying Prospectus Supplement.
SUPPLEMENTAL PLAN OF DISTRIBUTION
Subject to the terms and conditions set forth in the Terms Agreement dated
November 19, 1998, which incorporates provisions from the Distribution Agreement
dated January 13, 1997, the Company has agreed to sell to each of the
Underwriters named below (the "Underwriters"), and each of the Underwriters has
severally agreed to purchase, the respective principal amount of the notes set
forth opposite its name below:
Page 12 of 27 Pages
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Principal Amount
Underwriter of Notes
----------- ----------------
Merrill Lynch, Pierce, Fenner & Smith
Incorporated.......................... $ 90,000,000
Lehman Brothers Inc................................. 30,000,000
Morgan Stanley & Co. Incorporated................... 30,000,000
--------------
Total $ 150,000,000
==============
The Underwriters have advised the Company that they propose initially to
offer the notes to the public at the public offering price set forth on the
cover page of this pricing supplement, and to certain dealers at such price less
a concession not in excess of .4 % of the principal amount per note. The
Underwriters may allow, and such dealers may reallow, a discount not in excess
of .25 % of the principal amount per note to certain other dealers. After the
initial public offering, the public offering price, concession and discount may
be changed.
The notes are a new issue of securities with no established trading market.
The Company has been advised by the Underwriters that they intend to make a
market in the notes but are not obligated to do so and may discontinue any
market making at any time without notice. The notes will not be listed on any
stock exchange, and there can be no assurance that there will be a secondary
market for the notes or that there will be liquidity in such market if one
develops.
The Company has agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as amended.
See "Distribution" in the accompanying prospectus and "Plan of Distribution" in
the accompanying prospectus supplement.
Page 13 of 27 Pages
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ANNEX B
Purchaser Principal Amount
- --------- ----------------
Merrill Lynch, Pierce, Fenner &
Smith Incorporated.......................... $ 90,000,000
Lehman Brothers Inc.................................. $ 30,000,000
Morgan Stanley & Co.
Incorporated................................ $ 30,000,000
------------
Total $150,000,000
Page 14 of 27 Pages
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ANNEX C
If any Purchaser or Purchasers default in their obligations to purchase
Notes agreed to be purchased by such Purchaser or Purchasers hereunder and the
aggregate principal amount of Notes which such defaulting Purchaser or
Purchasers agreed but failed to purchase does not exceed 10% of the total
principal amount of Notes, the Purchasers may make arrangements satisfactory to
the Company for the purchase of such Notes by other persons, including any of
the Purchasers, but if no such arrangements are made by the Closing Date, the
nondefaulting Purchasers shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Notes which such defaulting
Purchasers agreed but failed to purchase. If any Purchaser or Purchasers so
default and the aggregate principal amount of Notes with respect to which such
default or defaults occur exceeds 10% of the total principal amount of Notes and
arrangements satisfactory to the Purchasers and the Company for the purchase of
such Notes by other persons are not made within 36 hours after such default,
this Terms Agreement will terminate without liability on the part of any
nondefaulting Purchaser or the Company. As used herein, the term "Purchaser"
includes any person substituted for a Purchaser under the terms of this
paragraph. Nothing herein will relieve a defaulting Purchaser from liability for
its default.
Page 15 of 27 Pages
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Exhibit 4.1
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (THE "DEPOSITARY") (55 WATER STREET, NEW YORK, NEW YORK) TO THE
ISSUER HEREOF OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME
AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY AND ANY PAYMENT
IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY.
REGISTERED CUSIP No.: PRINCIPAL AMOUNT:
No. FXR - 0005 40621P AE9 $150,000,000
HALLIBURTON COMPANY
MEDIUM-TERM NOTE
(Fixed Rate)
- ----------------------------------------------------------------------------------------------------------------------
ORIGINAL ISSUE DATE: INTEREST RATE: 5 5/8 % STATED MATURITY DATE:
November 24, 1998 December 1, 2008
- ----------------------------------------------------------------------------------------------------------------------
INTEREST PAYMENT DATE(S) DEFAULT RATE: 5 5/8 %
[X] June 1 and December 1
[ ] Other:
- ----------------------------------------------------------------------------------------------------------------------
INITIAL REDEMPTION INITIAL REDEMPTION ANNUAL REDEMPTION PERCENTAGE
DATE: See Addendum A hereto. PERCENTAGE: See Addendum A hereto. REDUCTION: Not applicable.
- ----------------------------------------------------------------------------------------------------------------------
OPTIONAL REPAYMENT DATE(S):See [ ] CHECK IF AN ORIGINAL ISSUE
Addendum A hereto. DISCOUNT NOTE
Issue Price: %
- ----------------------------------------------------------------------------------------------------------------------
SPECIFIED CURRENCY: AUTHORIZED DENOMINATION: EXCHANGE RATE
[X] United States dollars [X] $1,000 and integral multiples AGENT: Not Applicable.
thereof
[ ] Other
- ----------------------------------------------------------------------------------------------------------------------
ADDENDUM ATTACHED OTHER/ADDITIONAL PROVISIONS:
[X] Yes Not Applicable.
[ ] No
- ----------------------------------------------------------------------------------------------------------------------
Page 16 of 27 Pages
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Halliburton Company, a Delaware corporation (the "Company," which term
includes any successor corporation under the Indenture hereinafter referenced),
for value received, hereby promises to pay to The Depositary Trust Company, or
registered assigns, the principal sum of One Hundred Fifty Million Dollars
($150,000,000), on the Stated Maturity Date specified above (or any Redemption
Date or Repayment Date, each as defined on the reverse hereof) (each such Stated
Maturity Date, Redemption Date or Repayment Date being hereinafter referred to
as the "Maturity Date" with respect to the principal repayable on such date) and
to pay interest thereon, at the Interest Rate per annum specified above, until
the principal hereof is paid or duly made available for payment, and (to the
extent that the payment of such interest shall be legally enforceable) at the
Default Rate per annum specified above on any overdue principal, premium, if
any, and interest, if any. The Company will pay interest in arrears on each
Interest Payment Date, if any, specified above (each, an "Interest Payment
Date"), commencing with the first Interest Payment Date next succeeding the
Original Issue Date specified above, and on the Maturity Date; provided,
however, that, if the Original Issue Date occurs between a Record Date (as
defined below) and the next succeeding Interest Payment Date, interest payments
will commence on the second Interest Payment Date. Interest on this Note will be
computed on the basis of a 360-day year of twelve 30-day months.
Interest on this Note will accrue from, and including, the immediately
preceding Interest Payment Date to which interest has been paid or duly provided
for (or from, and including, the Original Issue Date if no interest has been
paid or duly provided for) to, but excluding, the applicable Interest Payment
Date or the Maturity Date, as the case may be (each, an "Interest Payment
Period"). The interest so payable, and punctually paid or duly provided for, on
any Interest Payment Date will, subject to certain exceptions described herein,
be paid to the person in whose name this Note (or one or more predecessor Notes)
is registered at the close of business on the fifteenth calendar day (whether or
not a Business Day, as defined below) immediately preceding such Interest
Payment Date (the "Record Date"); provided, however, that Interest payable on
the Maturity Date will be payable to the person to whom the principal hereof and
premium, if any, hereon shall be payable. Any such interest not so punctually
paid or duly provided for ("Defaulted Interest") will forthwith cease to be
payable to the Holder on any Record Date, and shall be paid to the person in
whose name this Note is registered at the close of business on a special record
date (the "Special Record Date") for the payment of such Defaulted Interest to
be fixed by a New York affiliate of the Trustee (the "Issuing and Paying Agent")
hereinafter referred to, notice whereof shall be given to the Holder of this
Note by the Issuing and Paying Agent not less than 10 calendar days prior to
such Special Record Date or may be paid at any time in any other lawful manner
not inconsistent with the requirements of any securities exchange on which this
Note may be listed, and upon such notice as may be required by such exchange,
all as more fully provided for in the Indenture.
Payment of principal, premium, if any, and interest, if any, in respect to
this Note due on the Maturity Date will be made in immediately available funds
upon presentation and surrender of this Note (and, with respect to any
applicable repayment of this Note, a duly completed election form as
contemplated on the reverse hereof) at the corporate trust office
Page 17 of 27 Pages
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of the Issuing and Paying Agent, currently The Chase Manhattan Bank, 450 West
33rd Street, 15th Floor, New York, New York 10001, or, if no paying agent is
then appointed to act with respect to the Notes under the Indenture, at the
corporate trust office of the Trustee maintained for that purpose in the Borough
of Manhattan, The City of New York. Payment of interest due on any Interest
Payment Date other than the Maturity Date will be made by check mailed to the
address of the person entitled thereto as such address shall appear in the
Security Register maintained at the aforementioned office of the Paying Agent
or, if no paying agent is then appointed to act with respect to the Notes under
the Indenture, of the Trustee; provided, however, that a Holder of U.S.
$10,000,000 or more in aggregate principal amount of Notes (whether having
identical or different terms and provisions) will be entitled to receive
interest payments on such Interest Payment Date by wire transfer of immediately
available funds if appropriate wire transfer instructions have been received in
writing by the Issuing and Paying Agent not less than 15 calendar days prior to
such Interest Payment Date. Any such wire transfer instructions received by the
Issuing and Paying Agent shall remain in effect until revoked by such Holder.
If any Interest Payment Date or the Maturity Date falls on a day that is
not a Business Day, the required payment of principal, premium, if any, and
interest, if any, shall be made on the next succeeding Business Day with the
same force and effect as if made on the date such payment was due, and no
interest shall accrue with respect to such payment for the period from and after
such Interest Payment Date or the Maturity Date, as the case may be, to the date
of such payment on the next succeeding Business Day.
As used herein, "Business Day" means any day, other than a Saturday or
Sunday, that is neither a legal holiday nor a day on which banking institutions
are authorized or required by law, regulation or executive order to close in The
City of New York.
The Company is obligated to make payments of principal, premium, if any,
and interest, if any, in respect of this Note in United States dollars or such
other currency as is at the time of such payment legal tender for the payment of
public and private debts in the United States of America.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof and, if so specified on the face hereof, in an Addendum
hereto, which further provisions shall have the same force and effect as if set
forth on the face hereof.
Notwithstanding the foregoing, if an Addendum is attached hereto or
"Other/Additional Provisions" apply to this Note as specified above, this Note
shall be subject to the terms set forth in such Addendum or such
"Other/Additional Provisions."
Page 18 of 27 Pages
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Unless the Certificate of Authentication hereon has been executed by the
Issuing and Paying Agent by manual signature, this Note shall not be entitled to
any benefit under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, Halliburton Company has caused this Note to be duly
executed by one of its duly authorized officers.
HALLIBURTON COMPANY
By:
Name:
Title:
Dated: November 24, 1998
ISSUING AND PAYING AGENT'S CERTIFICATE OF AUTHENTICATION:
THIS IS ONE OF THE Debt Securities of the series designated therein referred to
in the within-mentioned Indenture.
THE CHASE MANHATTAN BANK
as Issuing and Paying Agent
By:
Authorized Signatory
Page 19 of 27 Pages
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[REVERSE OF NOTE]
HALLIBURTON COMPANY
MEDIUM-TERM NOTE
(Fixed Rate)
This Note is one of a duly authorized series of Debt Securities (the "Debt
Securities") of the Company issued and to be issued under a Second Senior
Indenture, dated as of December 1, 1996, as amended, modified or supplemented by
the First Supplemental Indenture dated as of December 5, 1996, and as further
amended, modified or supplemented from time to time (the "Indenture"), between
the Company and Texas Commerce Bank National Association (now Chase Bank of
Texas, National Association), as Trustee (the "Trustee"), which term includes
any successor trustee under the Indenture, to which Indenture and all Indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Company,
the Trustee and the Holders of the Debt Securities, and of the terms upon which
the Debt Securities are, and are to be, authenticated and delivered. This Note
is one of the series of Debt Securities designated as "Medium-Term Notes Due
Nine Months or More From Date of Issue, Series A" (the "Notes"). All terms used
but not defined in this Note or in an Addendum hereto shall have the meanings
assigned to such terms in the Indenture or on the face hereof, as the case may
be.
This Note is issuable only in registered form without coupons in minimum
denominations of U.S.$1,000 and integral multiples thereof or the minimum
Authorized Denomination specified on the face hereof.
This Note will not be subject to any sinking fund and, unless otherwise
specified on the face hereof in accordance with the provisions of the following
two paragraphs, will not be redeemable or repayable prior to the Stated Maturity
Date.
This Note will be subject to redemption at the option of the Company on any
date on or after the Initial Redemption Date, if any, specified on the face
hereof, in whole or from time to time in part, in increments of U.S.$1,000
(provided that any remaining principal amount hereof shall be at least
U.S.$1,000), at the Redemption Price (as defined below), together with unpaid
interest accrued hereon to the date fixed for redemption (each, a "Redemption
Date"), on notice given no more than 60 nor less than 30 calendar days prior to
the Redemption Date and in accordance with the provisions of the Indenture. The
"Redemption Price" shall initially be the Initial Redemption Percentage
specified on the face hereof multiplied by the unpaid principal amount of this
Note to be redeemed. The Initial Redemption Percentage shall decline at each
anniversary of the Initial Redemption Date by the Annual Redemption Percentage
Reduction, if any, specified on the face hereof until the Redemption Price is
100% of unpaid principal amount to be redeemed. In the event of redemption of
this Note in part only, a new Note of like tenor for the unredeemed portion
hereof and otherwise having the same terms as this Note shall be issued in the
name of the Holder hereof upon the presentation and surrender hereof.
Page 20 of 27 Pages
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This Note will be subject to repayment by the Company at the option of the
Holder hereof on the Optional Repayment Date(s), if any, specified on the face
hereof, in whole or in part in increments of U.S.$1,000 (provided that any
remaining principal amount hereof shall be at least U.S.$1,000), at a repayment
price equal to 100% of the unpaid principal amount to be repaid, together with
unpaid interest accrued thereon to the date fixed for repayment (each, a
"Repayment Date"). For this Note to be repaid, this Note must be received,
together with the form hereon entitled "Option to Elect Repayment" duly
completed, by the Issuing and Paying Agent at its corporate trust office not
more than 60 nor less than 30 calendar days prior to the Repayment Date.
Exercise of such repayment option by the Holder hereof will be irrevocable. In
the event of repayment of this Note in part only, a new Note of like tenor for
the unrepaid portion hereof and otherwise having the same terms as this Note
shall be issued in the name of the Holder hereof upon the presentation and
surrender hereof.
If this Note is an Original Issue Discount Note as specified on the face
hereof, the amount payable to the Holder of this Note in the event of
redemption, repayment or acceleration of maturity will be equal to the sum of
(1) the Issue Price specified on the face hereof (increased by any accruals of
the Discount, as defined below) and, in the event of any redemption of this Note
(if applicable, multiplied by the Initial Redemption Percentage (as applicable),
multiplied by the Initial Redemption Percentage (as adjusted by the Annual
Redemption Percentage Reduction, if applicable) and (2) any unpaid Interest on
this Note accrued from the Original Issue Date to the Redemption Date, Repayment
Date or date of acceleration of maturity, as the case may be. The difference
between the Issue Price and 100% of the principal amount of this Note is
referred to herein as the "Discount."
For purposes of determining the amount of Discount that has accrued as of
any Redemption Date, Repayment Date or date of acceleration of maturity of this
Note, such Discount will be accrued so as to cause the yield on the Note to be
constant. The constant yield will be calculated using a 30-day month, 360-day
year convention, a compounding period that, except for the Initial Period (as
defined below), corresponds to the shortest period between Interest Payment
Dates (with ratable accruals within a compounding period) and an assumption that
the maturity of this Note will not be accelerated. If the period from the
Original Issue Date to the Initial Interest Payment Date (the "Initial Period")
is shorter than the compounding period for this Note, a proportionate amount of
the yield for an entire compounding period will be accrued. If the Initial
Period is longer than the compounding period, then such period will be divided
into a regular compounding period and a short period, with the short period
being treated as provided in the preceding sentence.
If an Event of Default, as defined in the Indenture, shall occur and be
continuing, the principal of this Note may be accelerated in the manner and with
the effect provided in the Indenture.
Page 21 of 27 Pages
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The Indenture contains provisions for defeasance of (i) the entire
indebtedness of the Notes or (ii) certain covenants and Events of Default with
respect to the Notes, in each case upon compliance with certain conditions set
forth therein, which provisions apply to the Notes.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Debt Securities at any time by the
Company and the Trustee with the consent of the Holders of not less than a
majority of the aggregate principal amount of all Debt Securities at the time
outstanding and affected thereby. The Indenture also contains provisions
permitting the Holders of not less than a majority of the aggregate principal
amount of the outstanding Debt Securities of any series, on behalf of the
Holders of all such Debt Securities, to waive compliance by the Company with
certain provisions of the Indenture. Furthermore, provisions in the Indenture
permit the Holders of not less than a majority of the aggregate principal amount
of the outstanding Debt Securities of any series, in certain instances, to
waive, on behalf of all of the Holders of Debt Securities of such series,
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Note shall be conclusive and binding
upon such Holder and upon all future Holders of this Note and other Notes issued
upon the registration of transfer hereof or in exchange heretofore or in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Note.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay principal, premium, if any, and interest, if
any, in respect of this Note at the times, places and rate or formula, and in
the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein and
herein set forth, the transfer of this Note is registrable in the Security
Register of the Company upon surrender of this Note for registration of transfer
at the office or agency of the Company in any place where the principal hereof
and any premium or interest hereon are payable, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by the Holder hereof or by his attorney duly
authorized in writing, and thereupon one or more new Notes, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees.
As provided in the Indenture and subject to certain limitations therein and
herein set forth, this Note is exchangeable for a like aggregate principal
amount of Notes of different authorized denominations but otherwise having the
same terms and conditions, as requested by the Holder hereof surrendering the
same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Page 22 of 27 Pages
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Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Holder in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Indenture and this Note shall be governed by and construed in
accordance with the laws of the State of New York applicable to agreements made
and to be performed entirely in such State.
Page 23 of 27 Pages
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ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this Note, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
------ -------
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with under Uniform Gifts to Minors
right of survivorship and not Act
as tenants in common -------------------------
(State)
Additional abbreviations may also be used though not in the above list.
--------------------------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
(Please print or typewrite name and address, including postal zip code, of
assignee)
- -----------------------------------------------------------------------------
this Note and all rights thereunder hereby irrevocably constituting and
appointing
Attorney
- ----------------------------------------------------------------------
to transfer this Note on the books of the Trustee, with full power of
substitution in the premises.
Dated:
--------------- -------------- ---------------
-------------- ---------------
Notice: The signature(s) on this Assignment
must correspond with the name(s) as written
upon the face of this Note in very
particular, without alteration or
enlargement or any change whatsoever.
Page 24 of 27 Pages
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OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instruct(s) the Company
to repay this Note (or portion hereof specified below) pursuant to its terms at
a price equal to 100% of the principal amount to be repaid, together with unpaid
Interest accrued hereon to the Repayment Date, to the undersigned, at
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Please print or typewrite name and address of the undersigned)
For this Note to be repaid, the Issuing and Paying Agent must receive at
its corporate trust office in the Borough of Manhattan, The City of New York,
currently located at The Chase Manhattan Bank, 450 West 33rd Street, 15th Floor,
New York, New York 10001, not more than 60 nor less than 30 calendar days prior
to the Repayment Date, this Note with this "Option to Elect Repayment" form duly
completed.
If less than the entire principal amount of this Note is to be repaid,
specify the portion hereof (which shall be increments of U.S.$1,000) which the
Holder elected to have repaid and specify the denomination or denominations
(which shall be an Authorized Denomination) of the Notes to be issued to the
Holder for the portion of this Note not being repaid (in the absence of any such
specification, one such Note will be issued for the portion not being repaid).
Principal Amount
to be Repaid: $
----------------- -----------------------------------
Notice: The signature(s) on this
Option to Elect Repayment must
Date: correspond with the name(s) as
----------------------------- written upon the face of this Note
in every particular, without
alternation or enlargement or any
change whatsoever.
Page 25 of 27 Pages
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ADDENDUM
Redemption of Notes
The Notes will be redeemable as a whole or in part, at the option of the Company
at any time, at a redemption price equal to the greater of (i) 100% of the
principal amount of such Notes and (ii) the sum of the present values of the
remaining scheduled payments of principal and interest thereon discounted to the
redemption date on a semiannual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Treasury Rate plus 15 basis points, plus in each
case accrued interest thereon to the date of redemption.
"Treasury Rate" means, with respect to any redemption date, the rate per annum
equal to the semiannual equivalent yield to maturity of the Comparable Treasury
Issue, assuming a price for the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable Treasury Price for
such redemption date.
"Comparable Treasury Issue" means the United States Treasury security selected
by an Independent Investment Banker as having a maturity comparable to the
remaining term of the Notes to be redeemed that would be utilized, at the time
of selection and in accordance with customary financial practice, in pricing new
issues of corporate debt securities of a comparable maturity to the remaining
term of such Notes. "Independent Investment Banker" means one of the Reference
Treasury Dealers appointed by the Trustee after consultation with the Company.
"Comparable Treasury Price" means, with respect to any redemption date, (A) the
average of the Reference Treasury Dealer Quotations for such redemption date,
after excluding the highest and lowest such Reference Treasury Dealer Quotations
or (B), if the Trustee obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such quotations. "Reference Treasury Dealer
Quotations" means, with respect to each Reference Treasury Dealer and any
redemption date, the average, as determined by the Trustee, of the bid and asked
prices for the Comparable Treasury Issue (expressed in each case as a percentage
of its principal amount) quoted in writing to the Trustee by such Reference
Treasury Dealer at 3:30 p.m. New York time on the third business day preceding
such redemption date.
"Reference Treasury Dealer" means each of Goldman, Sachs & Co., Lehman Brothers
Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co.
Incorporated and Salomon Smith Barney Inc. and their respective successors;
provided, however, that, if any of the foregoing or their affiliates shall cease
to be a primary U.S. Government securities dealer in The City of New York (a
"Primary Treasury Dealer"), the Company shall substitute therefor another
Primary Treasury Dealer.
Notice of any redemption will be mailed at least 30 days but not more than 60
days before the redemption date to each holder of Notes to be redeemed.
Page 26 of 27 Pages
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Unless the Company defaults in payment of the redemption price, on and after the
redemption date interest will cease to accrue on the Notes or portions thereof
called for redemption.
(The remainder of this page left blank intentionally.)
Page 27 of 27 Pages
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