ConocoPhillips Announces Transaction Details for Debt Exchange Offers for up to $3.0 Billion of Debt Securities

HOUSTON--(BUSINESS WIRE)--ConocoPhillips (NYSE: COP) (“COP”) announced today that it is commencing a private offer to exchange (the “Pool 1 Offer”) four series of notes issued by COP, ConocoPhillips Company (“CPCo”) and Burlington Resources LLC (“Burlington”) as described in the table below (collectively, the “Pool 1 Notes”) for a combination of cash and a new series of CPCo’s senior notes due 2062 (the “New 2062 Notes”). The aggregate principal amount of Pool 1 Notes of each series that are accepted for exchange will be based on the order of acceptance priority for such series as set forth in the table below, such that the aggregate principal amount of Pool 1 Notes accepted in the Pool 1 Offer results in the issuance of New 2062 Notes in an amount not exceeding $2,000,000,000 (the “2062 Notes Cap”).

Pool 1 Notes
Acceptance Priority Level	CUSIP Number(s)	Title of Security	Issuer	Principal Amount Outstanding	Reference UST Security	Bloomberg Reference Page	Fixed Spread (basis points)(1)	Cash Payment Percent of Premium(2)
1	20825CAQ7	6.50% Notes due 2039	COP	$2,750,000,000	2.375% U.S. Treasury due February 15, 2042	FIT1	115	100%
2	20825VAB8	5.95% Notes due 2036	Burlington	$500,000,000	1.875% U.S. Treasury due February 15, 2032	FIT1	150	100%
3	20825CAP9	5.90% Notes due 2038	COP	$600,000,000	2.375% U.S. Treasury due February 15, 2042	FIT1	115	100%
4	20826FAR7	5.95% Notes due 2046*	CPCo	$500,000,000	1.875% U.S. Treasury due November 15, 2051	FIT1	125	80%

(1)	The Early Participation Payment for the Pool 1 Offer will be $30 of principal amount of New 2062 Notes per $1,000 principal amount of Pool 1 Notes and is included in the Total Consideration.
(2)	The Cash Payment Percent of Premium is the percentage of the amount by which the Total Consideration exceeds $1,000 in principal amount of such Pool 1 Notes to be paid in cash.
*	Denotes a series of Pool 1 Notes for which the Total Consideration and Exchange Consideration will be determined taking into account the par call date, instead of the maturity date, in accordance with market practice.

COP also announced today that it is commencing a private offer to exchange (the “Pool 2 Offer” and, together with the Pool 1 Offer, the “Exchange Offers”) five series of notes issued by CPCo, Burlington and Burlington Resources Oil & Gas Company LP (“BRO&G”) as described in the table below (collectively, the “Pool 2 Notes” and, together with the Pool 1 Notes, the “Old Notes”) for a combination of cash and a new series of CPCo’s senior notes due 2042 (the “New 2042 Notes” and, together with the New 2062 Notes, the “New Notes”). The aggregate principal amount of Pool 2 Notes of each series that are accepted for exchange will be based on the order of acceptance priority for such series as set forth in the table below, such that the aggregate principal amount of Pool 2 Notes accepted in the Pool 2 Offer results in the issuance of New 2042 Notes in an amount not exceeding $1,000,000,000 (the “2042 Notes Cap”).

Pool 2 Notes
Acceptance Priority Level	CUSIP Number(s)	Title of Security	Issuer	Principal Amount Outstanding	Reference UST Security	Bloomberg Reference Page	Fixed Spread (basis points)(1)	Cash Payment Percent of Premium(2)
1	208251AE8	6.95% Notes due 2029	CPCo	$1,549,114,000	1.875% U.S. Treasury due February 15, 2032	FIT1	75	100%
2	12201PAN6	7.40% Notes due 2031	Burlington	$500,000,000	1.875% U.S. Treasury due February 15, 2032	FIT1	95	100%
3	20825UAC8	7.25% Notes due 2031	BRO&G	$500,000,000	1.875% U.S. Treasury due February 15, 2032	FIT1	95	100%
4	12201PAB2	7.20% Notes due 2031	Burlington	$575,000,000	1.875% U.S. Treasury due February 15, 2032	FIT1	95	100%
5	718507BK1	7.00% Notes due 2029	CPCo	$200,000,000	1.875% U.S. Treasury due February 15, 2032	FIT1	85	110%

(1)	The Early Participation Payment for the Pool 2 Offer will be $30 of principal amount of New 2042 Notes per $1,000 principal amount of Pool 2 Notes and is included in the Total Consideration.
(2)	The Cash Payment Percent of Premium is the percentage of the amount by which the Total Consideration exceeds $1,000 in principal amount of such Pool 2 Notes to be paid in cash.

Set forth below is a table summarizing the terms of the New Notes:

Title of Series	Maturity Date	Benchmark Security	Spread to Benchmark Security
New 2062 Notes	March 15, 2062	1.875% U.S. Treasury due November 15, 2051	175 bps
New 2042 Notes	March 15, 2042	2.375% U.S. Treasury due February 15, 2042	140 bps

The Exchange Offers are being conducted upon the terms and subject to the conditions set forth in an offering memorandum, dated February 22, 2022 (the “Offering Memorandum”). Capitalized terms used in this news release and not defined herein have the meanings given to them in the Offering Memorandum.

The “Total Consideration” for each of the Pool 1 Offer and the Pool 2 Offer for each $1,000 principal amount of each series of Old Notes validly tendered pursuant to the Pool 1 Offer or the Pool 2 Offer, as the case may be, at or prior to the Early Participation Deadline (as defined below) and accepted for purchase will be equal to an amount that would reflect a yield to the maturity date or, if applicable, the par call date of such series of Old Notes (excluding accrued and unpaid interest to, but not including the applicable Settlement Date) equal to the sum of (i) the bid-side yield on the applicable Reference U.S. Treasury Security as calculated by the Dealer Managers in accordance with market practice, as of the Pricing Determination Date, plus (ii) a Fixed Spread with respect to such series of Old Notes set forth in the tables above. The Total Consideration (which will include an Early Participation Payment of $30 of principal amount of the New 2062 Notes or New 2042 Notes, as applicable) for each of the Exchange Offers for holders tendering and not validly withdrawing their Old Notes at or prior to the Early Participation Deadline will be divided into (i) a cash payment equal to the product of (x) the applicable Cash Payment Percent of Premium set forth in the tables above for such series of Old Notes and (y) the applicable Total Consideration for such series of Old Notes less $1,000 (the “Cash Payment”) and (ii) a principal amount of the New Notes determined by multiplying each $1,000 principal amount of Old Notes tendered by an exchange ratio equal to the quotient obtained by dividing (a) the Total Consideration of the series of outstanding Old Notes tendered minus such Cash Payment by (b) the New Issue Price. The “New Issue Price” for each series of New Notes will be deemed to be $1,000 per $1,000 principal amount of New Notes. The amount of the Cash Payment is subject to adjustment as described in the Offering Memorandum.

Each series of New Notes will bear interest at a rate per annum equal to the sum of (a) the bid-side yield on the applicable Benchmark Security as calculated by the Dealer Managers in accordance with market practice, as of the Pricing Determination Date, plus (b) a fixed spread with respect to such series of New Notes.

In addition, holders whose Old Notes are accepted for exchange will receive in cash accrued and unpaid interest from the last applicable interest payment date to, but excluding, the date on which the exchange of such Old Notes is settled, less the amount of any pre-issuance interest on the New Notes exchanged therefor on the Final Settlement Date only, and amounts due in lieu of fractional amounts of New Notes. In the case of any New Notes issued on the Final Settlement Date, if the pre-issuance interest accrued on such New Notes exceeds the accrued and unpaid interest on the Old Notes exchanged therefor, then no accrued and unpaid interest on such Old Notes will be paid.

COP reserves the right, in its sole and absolute discretion, to increase the 2062 Notes Cap or the 2042 Notes Cap without extending the Withdrawal Deadline (as defined below) or otherwise reinstating withdrawal rights.

Each Exchange Offer is subject to certain conditions, including, (i) with respect to the Pool 1 Offer, a minimum of $500,000,000 aggregate principal amount of New 2062 Notes being issued in the Pool 1 Offer, (ii) with respect to the Pool 2 Offer, a minimum of $500,000,000 aggregate principal amount of New 2042 Notes being issued in the Pool 2 Offer, (iii) as of 10:00 a.m. New York City time on March 8, 2022, the combination of the yield of the New Notes and the Total Consideration or Exchange Consideration, as applicable, for the applicable series of Old Notes would result in the New Notes and such Old Notes not considered as “substantially different” under Financial Accounting Standards Board Accounting Standards Codification Subtopic 470-50, (iv) COP receiving aggregate gross proceeds of at least $2.7 billion from the public offering, commenced substantially concurrently with the Exchange Offers, of three series of senior debt securities issued by CPCo and guaranteed by COP on or prior to March 11, 2022, the date currently expected to be the Early Settlement Date, on terms acceptable to COP, in its sole discretion, and (v) with respect to any Old Notes validly tendered pursuant to any Exchange Offer that will be exchanged on the Final Settlement Date (as defined below), COP determines that the New Notes to be issued on the Final Settlement Date in such Exchange Offer will be treated as part of the same issue as the New Notes, if any, issued on the Early Settlement Date for U.S. federal income tax purposes pursuant to specified tests.

Only Eligible Holders (as defined below) of Old Notes who validly tender their Old Notes at or before 5:00 p.m. New York City time on March 7, 2022, subject to any extension by COP (the “Early Participation Deadline”), who do not validly withdraw their tenders and whose Old Notes are accepted for exchange, will receive the Early Participation Payment.

The Exchange Offers will expire at one minute after 11:59 p.m., New York City time, on March 21, 2022, unless extended (the “Expiration Date”) or earlier terminated. Tenders of Old Notes submitted in the Exchange Offers at or prior to 5:00 p.m. New York City time on March 7, 2022, subject to any extension by COP (the “Withdrawal Deadline”), may be validly withdrawn at any time prior to the Withdrawal Deadline, but thereafter will be irrevocable, except in certain limited circumstances where additional withdrawal rights are required by law (as determined by COP). Tenders submitted in the Exchange Offers after the Withdrawal Deadline will be irrevocable except in the limited circumstances where additional withdrawal rights are required by law (as determined by COP).

COP reserves the right, but is under no obligation, at any point following the Early Participation Deadline and before the Expiration Date, to accept for exchange any Old Notes validly tendered at or prior to the Early Participation Deadline (the date of such exchange, the “Early Settlement Date”). The Early Settlement Date will be determined at COP’s option and is currently expected to occur on March 11, 2022, the third business day immediately following the Pricing Determination Date. If, after the Early Participation Deadline, COP chooses to exercise its option to have an Early Settlement Date and all conditions to the relevant Exchange Offers have been or are concurrently satisfied or waived by COP, COP will, subject to the terms of the Exchange Offers, accept for exchange all Old Notes validly tendered in the Exchange Offers prior to the Early Participation Deadline subject to proration, and the exchange for such Old Notes will be made on the Early Settlement Date.

The Final Settlement Date for the Exchange Offers will be promptly after the Expiration Date and is currently expected to occur on March 23, 2022, the second business day immediately following the Expiration Date (the “Final Settlement Date”).

The Exchange Offers are only being made, and the New Notes are only being offered and will only be issued, and copies of the offering documents will only be made available, to holders of Old Notes (1) either (a) in the United States, that are “qualified institutional buyers,” or “QIBs,” as that term is defined in Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), in a private transaction in reliance upon an exemption from the registration requirements of the Securities Act or (b) outside the United States, that are persons other than “U.S. persons,” as that term is defined in Rule 902 under the Securities Act, in offshore transactions in reliance upon Regulation S under the Securities Act, or a dealer or other professional fiduciary organized, incorporated or (if an individual) residing in the United States holding a discretionary account or similar account (other than an estate or a trust) for the benefit or account of a non-“U.S. person,” and (2) (a) if located or resident in any Member State of the European Economic Area, who are persons other than “retail investors” (for these purposes, a retail investor means a person who is one (or more) of: (i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended, “MiFID II”); or (ii) a customer within the meaning of Directive (EU) 2016/97, where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II; or (iii) not a “qualified investor” as defined in Regulation (EU) 2017/1129), and consequently no key information document required by Regulation (EU) No 1286/2014 (as amended, the “PRIIPs Regulation”) for offering or selling the New Notes or otherwise making them available to retail investors in the European Economic Area has been prepared and therefore offering or selling the New Notes or otherwise making them available to any retail investor in the European Economic Area may be unlawful under the PRIIPs Regulation; or (b) if located or resident in the United Kingdom, who are persons other than “retail investors” (for these purposes, a retail investor means a person who is one (or more) of: (i) a retail client, as defined in point (8) of Article 2 of Regulation (EU) No 2017/565 as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018 (“EUWA”); or (ii) a customer within the meaning of the provisions of the Financial Services and Markets Act 2000 (the “FSMA”) and any rules or regulations made under the FSMA to implement Directive (EU) 2016/97, where that customer would not qualify as a professional client, as defined in point (8) of Article 2(1) of Regulation (EU) No 600/2014 as it forms part of domestic law by virtue of the EUWA; or (iii) not a qualified investor as defined in Article 2 of Regulation (EU) 2017/1129 as it forms part of domestic law by virtue of the EUWA), and consequently no key information document required by Regulation (EU) No 1286/2014 as it forms part of domestic law by virtue of the EUWA (the “UK PRIIPs Regulation”) for offering or selling the New Notes or otherwise making them available to retail investors in the United Kingdom has been prepared and therefore offering or selling the New Notes or otherwise making them available to any retail investor in the United Kingdom may be unlawful under the UK PRIIPs Regulation (“Eligible Holders”). The Exchange Offers will not be made to holders of Old Notes who are located in Canada. Only Eligible Holders who have completed and returned the eligibility certification are authorized to receive or review the Offering Memorandum or to participate in the Exchange Offers. There is no separate letter of transmittal in connection with the Offering Memorandum.

The New Notes have not been registered under the Securities Act or any state securities laws. Therefore, the New Notes may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and any applicable state securities laws.

Holders are advised to check with any bank, securities broker or other intermediary through which they hold Old Notes as to when such intermediary needs to receive instructions from a holder in order for that holder to be able to participate in, or (in the circumstances in which revocation is permitted) revoke their instruction to participate in the Exchange Offers before the deadlines specified herein and in the Offering Memorandum and eligibility certification. The deadlines set by each clearing system for the submission and withdrawal of exchange instructions will also be earlier than the relevant deadlines specified herein and in the Offering Memorandum and eligibility certification.

This press release is not an offer to sell or a solicitation of an offer to buy any of the securities described herein. The Exchange Offers are being made solely by the Offering Memorandum and eligibility certification and only to such persons and in such jurisdictions as is permitted under applicable law.

Global Bondholder Services Corporation has been appointed as the exchange agent and information agent for the Exchange Offers. Documents relating to the Exchange Offers will only be distributed to holders of Old Notes who certify that they are Eligible Holders. Questions or requests for assistance related to the Exchange Offers or for additional copies of the Offering Memorandum and eligibility certification may be directed to Global Bondholder Services Corporation at [phone] (toll-free) or [phone] (banks and brokers) or by email at [e-mail]. You may also contact your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Exchange Offers. The Offering Memorandum and eligibility certification can be accessed at the following link: https://gbsc-usa.com/eligibility/cop.

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About ConocoPhillips

ConocoPhillips is one of the world’s leading exploration and production companies based on both production and reserves, with a globally diversified asset portfolio. Headquartered in Houston, Texas, ConocoPhillips had operations and activities in 14 countries, $91 billion of total assets and approximately 9,900 employees at Dec. 31, 2021. Production including Libya averaged 1,567 MBOED for the 12 months ended Dec. 31, 2021, and proved reserves were 6.1 BBOE as of Dec. 31, 2021. For more information, go to www.conocophillips.com.

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