Document:

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EXHIBIT 4.1

EXECUTION VERSION

Pioneer Natural Resources Company

6.875% Senior Notes due 2018

Debt Securities

Underwriting Agreement

April 26, 2006

Deutsche Bank Securities Inc.

As Representative of the several

Underwriters named in Schedule II hereto

c/o Deutsche Bank Securities Inc.

60 Wall Street, New York, New York 10005

Ladies and Gentlemen:

     Pioneer Natural Resources Company, a Delaware corporation (the “Company”), proposes to sell to
the several underwriters named in Schedule II hereto (the “Underwriters”), for whom you
(the “Representative”) are acting as representative, the principal amount of its 6.875% Senior
Notes due 2018, as described in Schedule I hereto (the “Securities”), to be issued under an
indenture dated as of January 13, 1998, as amended and supplemented (the “Original Indenture”),
between The Bank of New York Trust Company, N.A., as successor trustee (the “Trustee”) and the
Company, as to be supplemented with respect to the Securities by the Sixth Supplemental Indenture
to be dated as of the Closing Date (as defined below), among the Trustee and the Company (the
“Sixth Supplemental Indenture” and, together with the Original Indenture, the “Indenture”). To the
extent there are no additional Underwriters listed on Schedule II other than you, the term
Representative as used herein shall mean you, as Underwriters, and the terms Representative and
Underwriters shall mean either the singular or plural as the context requires. Any reference
herein to the Registration Statement, the Basic Prospectus, any Preliminary Final Prospectus or the
Final Prospectus shall be deemed to refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 that were filed under the Exchange Act on or before the
Effective Date of the Registration Statement or the issue date of the Basic Prospectus, any
Preliminary Final Prospectus or the Final Prospectus, as the case may be; and any reference herein
to the terms “amend”, “amendment” or “supplement” with respect to the Registration Statement, the
Basic Prospectus, any Preliminary Final Prospectus or the Final Prospectus shall be deemed to refer
to and include the filing of any document under the Exchange Act after the Effective Date of the
Registration Statement or the issue date of the Basic Prospectus, any Preliminary Final Prospectus
or the Final Prospectus, as the case may be, deemed to be incorporated therein by reference.
Certain terms used herein are defined in Section 17 hereof.

 

 

          1.      Representations and Warranties. The Company represents and warrants to, and agrees
with, each Underwriter as set forth below in this Section 1 that:

          (a)      Registration Requirement Compliance. The Company meets the eligibility
requirements for use of Form S-3, has filed a registration statement on Form S-3 (File No. 333-88478)
in respect of the Securities and has caused the Trustee to prepare and file with the
Commission a Statement of Eligibility and Qualification on Form T-1 (the “Form T-1”); such
registration statement and any post-effective amendment thereto, in each case including the Basic
Prospectus (with such deletions therefrom and additions thereto as are permitted or required by
Form S-3 and the applicable rules and regulations of the Commission), each in the form heretofore
delivered or to be delivered to the Representative, including exhibits to such registration
statement and any documents incorporated by reference in the prospectus contained therein, for
delivery by them to each of the other Underwriters, became effective under the Act in such form; no
other document with respect to such registration statement or documents incorporated by reference
therein has heretofore been filed or transmitted for filing with the Commission; no stop order
suspending the effectiveness of such registration statement has been issued and, to the Company’s
knowledge, no proceeding for that purpose has been initiated or threatened by the Commission; the
various parts of such registration statement, including all exhibits thereto and the documents
incorporated by reference in the prospectus contained in the registration statement at the time
such part of the registration statement became effective but excluding the Form T-1 of the Trustee,
each as amended at the time such part of the registration statement became effective and including
any post effective amendment thereto, and including any prospectus supplement relating to the
Securities that is filed with the Commission and deemed part of such registration statement, 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 Execution Time, being hereinafter called the “Basic Prospectus”;
with respect to the Securities, “Final Prospectus” means the Basic Prospectus as amended or
supplemented prior to the Execution Time, until such time after the Execution Time as the first
prospectus supplement containing pricing information with respect to the Securities relating to the
offering of the Securities is filed with the Commission, at which time “Final Prospectus” with
respect to such Securities, shall mean the Basic Prospectus including such supplement; any
reference herein to any Basic Prospectus, Preliminary Final Prospectus, or Final Prospectus shall
be deemed to refer to and include the documents incorporated by reference therein as of the date of
such Basic Prospectus, Preliminary Final Prospectus or Final Prospectus, as the case may be; any
reference to any amendment or supplement to any Basic Prospectus, Basic Prospectus, Preliminary
Final Prospectus or Final Prospectus shall be deemed to refer to and include any documents filed as
of the date of such amendment or supplement under the Exchange Act and incorporated by reference in
such amendment or supplement;

          (b)      Incorporated Documents. The documents included or incorporated by reference in
the Registration Statement and the Final Prospectus, when they became effective or were filed with
the Commission, as the case may be, conformed in all material respects to any applicable
requirements of the Exchange Act and the rules and regulations of the Commission thereunder and any
further documents so filed and incorporated by reference in the Final Prospectus or any amendment
or supplement

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thereto, when such documents are filed with the Commission, will conform in all material
respects to the requirements of the Exchange Act;

          (c)      Disclosure Conformity. On the Effective Date, the Registration Statement did, and
on the date it was first filed and on the Closing Date, the Final Prospectus did and will conform
in all material respects with the Act and the Trust Indenture Act and the rules and regulations of
the Commission under both the Act and the Trust Indenture Act; on the date each was first filed,
the Basic Prospectus did and the Final Prospectus will, and on the Closing Date each will, conform
in all material respects with the applicable requirements of the rules and regulations of the
Commission; the Registration Statement, as of the Effective Date, and the Basic Prospectus as of
its filing date, and in each case at the Execution Time, did not 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, in light of the circumstances under which they were made,
not misleading; and the Final Prospectus will not, as of its filing date and as of the Closing
Date, 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, in light of the circumstances under
which they were made, 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 or on behalf of any Underwriter through the
Representative specifically for inclusion in the Registration Statement, the Final Prospectus, or
to the Form T-1 of the Trustee;

          (d)      Disclosure Package. As of 5:00 pm (Eastern time) on the date of this Agreement
(the “Initial Sale Time”) and as of the Closing Date, the Disclosure Package does not and will not
contain any 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,
not misleading. The preceding sentence does not apply to statements in or omissions from the
Disclosure Package made in reliance upon and in conformity with information furnished in writing to
the Company or on behalf of any Underwriter through the Representative specifically for inclusion
therein;

          (e)      Company not Ineligible Issuer. (i) At the earliest time after the filing of the
Registration Statement that the Company or another offering participant made a bona fide offer
(within the meaning of Rule 164(h)(2) under the Act) of the Securities and (ii) as of the Execution
Time (with such date being used as the determination date for purposes of this clause (ii)), the
Company was not and is not an Ineligible Issuer (as defined in Rule 405 under the Act), without
taking account of any determination by the Commission pursuant to Rule 405 under the Act that it is
not necessary that the Company be considered an Ineligible Issuer;

          (f)      Issuer Free Writing Prospectuses. Each Issuer Free Writing Prospectus does not
include any information that conflicts with the information contained in the Registration
Statement, including any document incorporated therein and any prospectus supplement deemed to be a
part thereof that has not been superseded or modified. If there occurs an event or development as
a result of which the Disclosure Package would include an untrue statement of a material fact or
would omit to state a material fact necessary in order to make the statements therein, in the light
of the

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circumstances then prevailing, not misleading, the Company will notify promptly the
Representative so that any use of the Disclosure Package may cease until it is amended or
supplemented. The foregoing two sentences do not apply to statements in or omissions from the
Disclosure Package made in reliance upon and in conformity with information furnished in writing to
the Company by or on behalf of any Underwriter through the Representative specifically for use
therein;

          (g)      Company Good Standing. The Company has been duly incorporated and is validly
existing as a corporation under the laws of the State of Delaware with full corporate power and
authority to own or lease, as the case may be, and to operate its properties and conduct its
business as described in the Disclosure Package and the Final Prospectus, and is duly qualified to
transact business and is in good standing in each jurisdiction in which the conduct of its business
or its ownership or leasing of property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a material adverse effect on the
condition (financial or otherwise), earnings, business or properties of the Company and its
subsidiaries, taken as a whole;

          (h)      Subsidiary Good Standing. Each subsidiary of the Company has been duly
incorporated or otherwise organized and is an existing corporation or other entity in good standing
under the laws of the jurisdiction of its incorporation or organization, with power and authority
(corporate and other) to own its properties and conduct its business as described in the Disclosure
Package and the Final Prospectus (or as presently conducted, if not so described therein); and each
subsidiary of the Company is duly qualified to do business as a foreign corporation or other entity
in good standing in all other jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification; all of the issued and outstanding capital
stock or other ownership interest of each subsidiary of the Company has been duly authorized and
validly issued and is fully paid and nonassessable; and the capital stock or other ownership
interest of each subsidiary owned by the Company, directly or through subsidiaries, is owned free
from liens, encumbrances and defects, other than those arising under the Company’s bank line of
credit;

          (i)      Authorized Capitalization. The Company has an authorized capitalization as
described in the Disclosure Package and the Final Prospectus;

          (j)      Agreement, Securities and Indenture Authorization. The Company has full corporate
power and authority to execute, deliver and perform its obligations under this Agreement and this
Agreement has been duly authorized, executed and delivered by the Company; the Securities have been
duly authorized and, when the Securities are issued and delivered pursuant to this Agreement, such
Securities will have been duly executed, authenticated, issued and delivered and, upon payment for
the Securities by the Representative to the Company, will constitute valid and legally binding
obligations of the Company entitled to the benefits of the Indenture; the Indenture, which was
incorporated by reference as an exhibit to the Registration Statement, has been duly authorized and
duly qualified under the Trust Indenture Act and constitutes a valid and legally binding
instrument, enforceable against the Company in accordance with its terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyances or
transfer, moratorium or similar laws affecting creditors’ rights generally and subject to general
principles of equity (regardless of

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whether enforceability is considered in a proceeding in equity or at law); and the Indenture
conforms, and the Securities will conform in all material respects to the descriptions thereof
contained in the Disclosure Package and the Final Prospectus with respect to such Securities;

          (k)      Material Changes. Since the respective dates as of which information is given in
the Registration Statement, the Disclosure Package and the Final Prospectus, except as may
otherwise be stated therein or contemplated thereby, there has been no material adverse change,
actual or to the knowledge of the Company, pending, in the condition (financial or otherwise),
earnings, business or properties of the Company and its subsidiaries, taken as a whole, whether or
not arising in the ordinary course of business;

          (l)      Financial Statements. The consolidated historical financial statements of the
Company included or incorporated by reference in the Disclosure Package, the Final Prospectus and
the Registration Statement present fairly in all material respects the financial condition, results
of operations and cash flows of the Company as of the dates and for the periods indicated, comply
as to form with the applicable accounting requirements of the Act and have been prepared in
conformity with U.S. generally accepted accounting principles applied on a consistent basis
throughout the periods involved (except as otherwise noted therein); and, if pro forma financial
statements are included or incorporated by reference in the Disclosure Package, the Final
Prospectus and the Registration Statement, then the assumptions used in preparing the pro forma
financial statements included therein provide a reasonable basis for presenting the significant
effects directly attributable to the transactions or events described therein, the related pro
forma adjustments give appropriate effect to those assumptions, and the pro forma columns therein
reflect the proper application of those adjustments to the corresponding historical financial
statement amounts; and

          (m)      Officers’ Certificates. Any certificate signed by any officer of the Company and
delivered to the Representative or counsel for the Underwriters in connection with the offering of
the Securities shall be deemed a representation and warranty by the Company (and not a
representation or warranty by the signing officer in his or her individual capacity), as to matters
covered thereby, to each Underwriter.

          2.      Purchase and Sale. Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company agrees to sell to each Underwriter,
and each Underwriter agrees, severally and not jointly, to purchase from the Company, at the
purchase price set forth in Schedule I hereto the principal amount of the Securities set
forth opposite such Underwriter’s name in Schedule II hereto.

          3.      Delivery and Payment. (a) Delivery of and payment for the Securities shall be made
on the date and at the time specified in Schedule I hereto or at such time on such later
date not more than three Business Days after the foregoing date as the Representative shall
designate, which date and time may be postponed by agreement between the Representative and the
Company or as provided in Section 8 hereof (such date and time of delivery and payment for the
Securities being herein called the “Closing Date”). Delivery of the Securities shall be made to
the Representative for the respective accounts of the several Underwriters against payment by the
several Underwriters

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through the Representative of the purchase price thereof to or upon the order of the Company
by wire transfer payable in same-day funds to an account specified by the Company. Delivery of the
Securities shall be made through the facilities of The Depository Trust Company unless the
Representative shall otherwise instruct and agree to with the Company; and

          (b)      As compensation for the services rendered by the Underwriters to the Company in respect of
the issuance and sale of the Securities, the Company on the Closing Date will pay to the
Representative for the respective accounts of the several Underwriters a commission of 0.650% of
the principal amount of Securities sold to the Underwriters under this Agreement. The Underwriters
agree to reimburse expenses incurred by the Company in connection with the issuance and sale of the
Securities in the amount of $962,500. Payment to the Representative shall be made by wire
transfer payable in same-day funds to an account specified by the Representative, net of the
$962,500 expense reimbursement. All payments to be made by the Company to the Representative as
compensation for the services rendered by the Underwriters to the Company in respect of the
issuance and sale of the Securities hereunder shall be made without withholding or deduction for or
on account of any present or future taxes, duties or governmental charges whatsoever, provided that
each Underwriter deals at arm’s length with the Company and (i) any such commission or fee is
payable in respect of services rendered by an Underwriter that are performed in the ordinary course
of business carried on by the Underwriter, which includes the performance of such services for a
fee, and (ii) any such amount is reasonable under the circumstances.

          4.      Agreements. The Company agrees with the Representative and the several
Underwriters that:

          (a)      Prior to the termination of the offering of the Securities, the Company will not file any
amendment or supplement to the Registration Statement or the Basic Prospectus (including the Final
Prospectus or any Preliminary Final Prospectus) unless the Company has furnished a copy to the
Representative for its review prior to filing and will not file any such proposed amendment or
supplement to which the Representative reasonably objects unless filing is immediately required by
law without right of appeal. Subject to the foregoing sentence, the Company will prepare the Final
Prospectus setting forth the principal amount of Securities covered thereby, the terms not
otherwise specified in the Basic Prospectus and Basic Prospectus pursuant to which the Securities
are being issued, the names of the Underwriters participating in the offering and the principal
amount of Securities which each severally has agreed to purchase, the names of the Underwriters
acting as co-managers in connection with the offering, the price at which the Securities are to be
purchased by the Underwriters from the Company, the initial public offering price, and the selling
concession and reallowance, if any, in a form approved by the Representative and shall file such
Final Prospectus with the Commission not later than the Commission’s close of business on the
second business day following the Execution Time. The Company will promptly file all reports
required to be filed by it with the Commission pursuant to Section 13(a), 13(c) or 15(d) of the
Exchange Act for so long as the delivery of a prospectus is required (including in circumstances
where such requirement may be satisfied pursuant to Rule 172 of the Act) in connection with the
offering or sale of the Securities, and during such same period will advise the Representative,
promptly after it receives notice thereof, of the time when any

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amendment to the Registration Statement has been filed or becomes effective or any supplement
to the Basic Prospectus or any amended Final 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 sale in any jurisdiction, of the initiation or threatening, to the
knowledge of the Company, of any proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration Statement, the Final Prospectus or
for additional information relating to the Securities; and the Company will use its commercially
reasonable best efforts to prevent the issuance of any such stop order or any such order preventing
or suspending the use of any prospectus relating to the Securities or the suspension of any such
qualification 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 use its commercially reasonable best efforts to obtain the withdrawal of
such order as soon as possible;

          (b)      Notwithstanding the provisions of paragraph (a) above, if, at any time when a prospectus
relating to the Securities is required to be delivered under the Act (including in circumstances
where such requirement may be satisfied pursuant to Rule 172), any event occurs as a result of
which the Final Prospectus, as then supplemented, would include any untrue statement of a material
fact or omit to state any material fact necessary to make the statements therein in the light of
the circumstances under which they were made not misleading, or if it shall be necessary to amend
the Registration Statement or supplement the Final Prospectus to comply with the Act or the
Exchange Act, or the respective rules thereunder, the Company will promptly (i) notify the
Representative of such event, (ii) prepare and file with the Commission an amendment or supplement
which will correct such statement or omission or effect such compliance and (iii) supply any
supplemented Final Prospectus to the Representative in such quantities as they may reasonably
request;

          (c)      As soon as practicable, the Company will make generally available to its security holders
an earnings statement or statements of the Company and its subsidiaries which will satisfy the
provisions of Section 11(a) of the Act and Rule 158 under the Act;

          (d)      The Company will furnish to the Representative and counsel for the Underwriters, without
charge, copies of the Registration Statement (including exhibits thereto) and to the Representative
for delivery to each other Underwriter a copy of the Registration Statement (without exhibits
thereto) and, so long as delivery of a prospectus by an Underwriter or dealer may be required by
the Act (including in circumstances where such requirement may be satisfied pursuant to Rule 172),
as many copies of each Preliminary Final Prospectus, Issuer Free Writing Prospectus and Final
Prospectus and any supplement thereto as the Representative may reasonably request. The Company
will pay the expenses of printing or other production of all documents relating to the offering;

          (e)      The Company will arrange, if necessary, for the qualification of the Securities for sale
under the laws of such jurisdictions in the United States of America as the Representative may
designate upon consultation with the Company and will maintain such qualifications in effect so
long as required for the distribution of the Securities and

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will pay any fee of the National Association of Securities Dealers, Inc., in connection with
its review of the offering; provided that in no event shall the Company be obligated to qualify to
do business in any jurisdiction where it is not now so qualified or to take any action that would
subject it to service of process in suits, other than those arising out of the offering or sale of
the Securities, in any jurisdiction where it is not now so subject;

          (f)      The Company agrees that, unless it obtains the prior written consent of the
Representative, and each Underwriter, severally and not jointly, agrees with the Company that,
unless it has obtained or will obtain, as the case may be, the prior written consent of the
Company, it has not made and will not make any offer relating to the Securities that would
constitute an Issuer Free Writing Prospectus or that would otherwise constitute a “free writing
prospectus” (as defined in Rule 405 under the Act) required to be filed by the Company with the
Commission or retained by the Company under Rule 433 under the Act; provided that the prior written
consent of the parties hereto shall be deemed to have been given in respect of the Free Writing
Prospectuses included in Schedule III hereto. Any such free writing prospectus consented
to by the Representative or the Company is hereinafter referred to as a “Permitted Free Writing
Prospectus.” The Company agrees that (x) it has treated and will treat, as the case may be, each
Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus and (y) it has complied and
will comply, as the case may be, with the requirements of Rules 164 and 433 under the Act
applicable to any Permitted Free Writing Prospectus, including in respect of timely filing with the
Commission, legending and record keeping;

          (g)      The Company will not, without the prior written consent of the Representative, offer,
sell, contract to sell, pledge, or otherwise dispose of (or enter into any transaction which is
designed to, or might reasonably be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash settlement or otherwise) by the Company
or any affiliate of the Company or any person in privity with the Company or any affiliate of the
Company) directly or indirectly, including the filing (or participation in the filing) of a
registration statement with the Commission in respect of, or establish or increase a put equivalent
position or liquidate or decrease a call equivalent position within the meaning of Section 16 of
the Exchange Act, any debt securities with a term in excess of nine months issued or guaranteed by
the Company (other than the Securities) or publicly announce an intention to effect any such
transaction within the U.S. marketplace until the Business Day set forth in Schedule I
hereto;

          (h)      The Company will use the net proceeds received by it from the sale of any Securities in
the manner specified in the Final Prospectus and the Disclosure Package under the caption “Use of
Proceeds”;

          (i)      In connection with each offering of Securities, the Company will take such steps as it
deems necessary to ascertain promptly whether each Preliminary Final Prospectus that supplements
the Basic Prospectus and the Final Prospectus prepared in connection with such offering and
transmitted for filing, in each case, was received for filing by the Commission, and, in the event
that any such prospectuses were not received for filing, it will promptly file any such prospectus
not then received for filing;

          (j)      The Company agrees to pay the costs and expenses relating to the following matters: (i)
the preparation, printing or reproduction and filing with the

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Commission of the Registration Statement (including financial statements and exhibits
thereto), any Issuer Free Writing Prospectus, each Preliminary Final Prospectus and Final
Prospectus, and each amendment or supplement to any of them; (ii) the printing (or reproduction)
and delivery (including postage, air freight charges and charges for counting and packaging) of
such copies of the Registration Statement, each Preliminary Final Prospectus, each Issuer Free
Writing Prospectus and Final Prospectus, and all amendments or supplements to any of them, as may,
in each case, be reasonably requested for use in connection with the offering and sale of the
Securities; (iii) the preparation, printing, authentication, issuance and delivery of certificates
for the Securities, including any stamp or transfer taxes in connection with the original issuance
and sale of the Securities; (iv) the printing (or reproduction) and delivery of this Agreement and
all other agreements or documents printed (or reproduced) and delivered in connection with the
offering of the Securities; (v) the transportation and other expenses of the Company’s officers and
employees in connection with presentations to prospective purchasers of the Securities; (vi) the
fees and expenses of the Company’s accountants and the fees and expenses of counsel for the
Company; (vii) any fees and expenses of the Trustee and any agent of the Trustee and the fees and
disbursements of counsel for the Trustee in connection with the Indenture and the Securities;
(viii) any fees charged by securities rating services for rating the Securities; and (ix) all other
costs and expenses of the Company and its representatives incident to the performance by the
Company of its obligations hereunder; and

          (k)      The Company will not take, directly or indirectly, any action designed to or that would
constitute or that might reasonably be expected to cause or result in, under the Exchange Act or
otherwise, stabilization or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities.

          5.      Conditions to the Obligations of the Underwriters. The obligations of the
Underwriters to purchase the Securities shall be subject to the accuracy of the representations and
warranties on the part of the Company contained herein as of the Execution Time and the Closing
Date, to the accuracy of the statements of the Company made in any certificates pursuant to the
provisions of this Section, to the performance by the Company of its obligations hereunder, and to
the following additional conditions:

          (a)      (i) Each Preliminary Final Prospectus that supplements the Basic Prospectus and the Final
Prospectus shall have been filed with the Commission, in each case, within the applicable time
period prescribed for such filing and in accordance with Section 4(a) hereof; no stop order
suspending the effectiveness of the Registration Statement or any part thereof shall have been
issued and no order preventing or suspending the use of any prospectus relating to the Securities
shall have been issued and no proceeding for any such purpose shall have been initiated or
threatened by the Commission;

          (b)      The Representative shall have received from Vinson & Elkins LLP, counsel for the Company,
their opinion, dated the Closing Date and addressed to the Representative, to the effect set forth
in Annex I hereto;

          (c)      The Representative shall have received from the General Counsel to the Company, his
opinion, dated the Closing Date and addressed to the Representative, to the effect set forth in
Annex II hereto;

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          (d)      The Representative shall have received from Milbank, Tweed, Hadley & McCloy LLP, counsel
for the Underwriters, such opinion or opinions, dated the Closing Date and addressed to the
Representative, with respect to the issuance and sale of the Securities, the Indenture (if
applicable), the Registration Statement, the Disclosure Package, the Final Prospectus (together
with any supplement thereto) and other related matters as the Representative may reasonably
require, and the Company shall have furnished to such counsel such documents as they reasonably
require and request for the purpose of enabling them to pass upon such matters;

          (e)      The Company shall have furnished to the Representative a certificate of the Company,
signed in their representative capacities by the Chief Executive Officer and Chief Financial
Officer of the Company, dated the Closing Date, to the effect that:

     (i)      the representations and warranties of the Company in this Agreement are true and
correct in all material respects on and as of the Closing Date with the same effect as if
made on the Closing Date and the Company has complied with all the agreements and satisfied
all the conditions on its part to be performed or satisfied at or prior to the Closing
Date;

     (ii)      no stop order suspending the effectiveness of the Registration Statement or stop
order preventing or suspending the use of any prospectus relating to the Securities has
been issued and no proceedings for that purpose have been, to the Company’s knowledge,
instituted or threatened by the Commission; and

     (iii)      since the date of the most recent financial statements included or incorporated
by reference in the Final Prospectus, as amended or supplemented prior to the Execution
Time, there has been no material adverse effect on the condition (financial or otherwise),
earnings, business or properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Final Prospectus, as amended or supplemented prior to the
Execution Time, or as described in such certificate;

          (f)      At the Execution Time and the Closing Date, the Representative shall have received from
Ernst & Young LLP a letter or letters dated such date or dates, in form and substance reasonably
satisfactory to the Representative, together with signed or reproduced copies of such letter or
letters for each of the other Underwriters containing statements and information of the type
ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial
statements and certain financial information contained in the Registration Statement, the Final
Prospectus, the Disclosure Package and any Issuer Free Writing Prospectus;

          (g)      Subsequent to the Execution Time or, if earlier, the dates as of which information is
given in the Registration Statement as amended or supplemented prior to the Execution Time, the
Final Prospectus as amended or supplemented prior to the Execution Time or any Issuer Free Writing
Prospectus, there shall not have been (i) any change or decrease specified in the letter or letters
referred to in paragraph (f) of this Section 5 or (ii) any change, or any development involving a
prospective change, in

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or affecting the condition (financial or otherwise), earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in the Final Prospectus, as
amended or supplemented prior to the Execution Time, the effect of which, in any case referred to
in clause (i) or (ii) above, is, in the sole judgment of the Representative, so material and
adverse as to make it impractical or inadvisable to proceed with the offering or delivery of the
Securities as contemplated by the Registration Statement, the Final Prospectus and any Issuer Free
Writing Prospectus;

          (h)      Subsequent to the Execution Time, there shall not have been any decrease in the rating of
any of the Company’s debt securities by any “nationally recognized statistical rating organization”
(as defined for purposes of Rule 436(g) under the Act) or any notice given of any intended or
potential decrease in any such rating or of a possible change in any such rating that does not
indicate the direction of the possible change; and

          (i)      Prior to the Closing Date, the Company shall have furnished to the Representative such
further information, certificates and documents as the Representative may reasonably request.

     If any of the conditions specified in this Section 5 shall not have been fulfilled in all
material respects when and as provided in this Agreement, or if any of the opinions and
certificates mentioned above or elsewhere in this Agreement shall not be in all material respects
reasonably satisfactory in form and substance to the Representative, this Agreement and all
obligations of the Underwriters hereunder may be canceled at, or at any time prior to, the Closing
Date by the Representative. Notice of such cancellation shall be given to the Company in writing
or by telephone or facsimile confirmed in writing.

     The documents required to be delivered by this Section 5 shall be delivered to the offices of
Milbank, Tweed, Hadley & McCloy LLP at One Chase Manhattan Plaza, New York, New York 10005 on the
Closing Date or such other place as the Representative shall so instruct.

          6.      Reimbursement of Underwriters’ Expenses. If the sale of the Securities provided
for herein is not consummated because any condition to the obligations of the Underwriters set
forth in Section 5 hereof is not satisfied, or because of any refusal, inability or failure on the
part of the Company to perform any agreement herein or comply with any provision hereof other than
by reason of a default by any of the Underwriters, the Company will reimburse the Underwriters
severally through the Representative on demand for all reasonable out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been incurred by them in connection
with the proposed purchase and sale of the Securities.

          7.      Indemnification and Contribution. (a) The Company agrees to indemnify and hold
harmless each Underwriter, the directors, officers, employees and agents of each Underwriter and
each person, if any, who controls any Underwriter within the meaning of the Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any of them may become
subject under the Act, the Exchange Act or other federal or state statutory law or regulation, at
common law or otherwise,

11

 

insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement as originally filed, the Basic Prospectus, any Preliminary
Final Prospectus, the Final Prospectus or any Issuer Free Writing Prospectus, or in all cases any
amendment thereof 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 agrees to reimburse each such indemnified party, as
incurred, for any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action; provided, however,
that the Company will 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 any such untrue statement or alleged untrue
statement or omission or alleged omission made therein in reliance upon and in conformity with
written information furnished to the Company by or on behalf of any Underwriter through the
Representative specifically for inclusion therein. This indemnity agreement will be in addition to
any liability which the Company may otherwise have;

          (b)      Each Underwriter severally and not jointly agrees to indemnify and hold harmless the
Company, each of its directors, its officers, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, to the same extent as the foregoing indemnity from
the Company to each Underwriter, but only with reference to written information relating to such
Underwriter furnished to the Company by or on behalf of such Underwriter through the Representative
specifically for inclusion in the documents referred to in the foregoing indemnity. This indemnity
agreement will be in addition to any liability which any Underwriter may otherwise have. The
Company acknowledges that the statements set forth in the last paragraph of the cover page
regarding delivery of the Securities and, under the heading “Underwriting”, (i) the names listed in
the table included in the first paragraph of the text, (ii) the third paragraph of text concerning
concessions, (iii) the sixth paragraph of text concerning confirmation of sales to any account over
which the Underwriters exercise discretionary authority, (iv) the third sentence in the seventh
paragraph of text concerning market making by the Underwriters and (v) the eighth, ninth and tenth
paragraphs of text concerning stabilizing transactions, penalty bids and transactions with the
Company or interests in the proceeds of the offering, in any Preliminary Final Prospectus and Final
Prospectus constitute the only information furnished in writing by or on behalf of the several
Underwriters for inclusion in any Preliminary Final Prospectus, the Registration Statement, the
Disclosure Package or the Final Prospectus;

          (c)      Promptly after receipt by an indemnified party under this Section 7 of notice of the
commencement of any action, such indemnified party will, if a claim in respect thereof is to be
made against the indemnifying party under this Section 7, notify the indemnifying party in writing
of the commencement thereof; but the failure so to notify the indemnifying party (i) will not
relieve it from liability under paragraph (a) or (b) above unless and to the extent the
indemnifying party did not otherwise learn of such action and such failure results in the
forfeiture by the indemnifying party of substantial rights and defenses and (ii) will not, in any
event, relieve the indemnifying party from any obligations to any indemnified party other than the
indemnification obligation provided in paragraph (a) or (b) above. The indemnifying party shall be
entitled to assume the defense thereof and to appoint counsel of the indemnifying party’s

12

 

choice at the indemnifying party’s expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not thereafter be responsible
for the fees and expenses of any separate counsel retained by the indemnified party or parties
except as set forth below); provided, however, that such counsel shall be reasonably satisfactory
to the indemnified party. Notwithstanding the indemnifying party’s election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall have the right to employ
separate counsel, and the indemnifying party shall bear the reasonable fees, costs and expenses of
such separate counsel (including local counsel) if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such counsel with a conflict of
interest, (ii) the actual or potential defendants in, or targets of, any such action include both
the indemnified party and the indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it and/or other indemnified parties which
are different from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified party
to represent the indemnified party within a reasonable time after notice of the institution of such
action or (iv) the indemnifying party shall authorize the indemnified party to employ separate
counsel at the expense of the indemnifying party. An indemnifying party will not, without the
prior written consent of the indemnified parties, settle or compromise or consent to the entry of
any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect
of which indemnification or contribution may be sought hereunder (whether or not the indemnified
parties are actual or potential parties to such claim or action) unless such settlement, compromise
or consent includes an unconditional release of each indemnified party from all liability arising
out of such claim, action, suit or proceeding; and

          (d)      In the event that the indemnity provided in paragraph (a) or (b) of this Section 7 is
unavailable to or insufficient to hold harmless an indemnified party for any reason, the Company
and the Underwriters severally agree to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in connection with investigating
or defending same) (collectively “Losses”) to which the Company and one or more of the Underwriters
may be subject in such proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and by the Underwriters on the other from the offering of the
Securities; provided, however, that in no case shall any Underwriter (except as may be provided in
any agreement among underwriters relating to the offering of the Securities) be responsible for any
amount in excess of the total price at which the Securities underwritten and distributed to the
public by such Underwriter was offered to the public. If the allocation provided by the
immediately preceding sentence is unavailable for any reason, the Company and the Underwriters
severally shall contribute 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 of the Underwriters on the
other in connection with the statements or omissions which resulted in such Losses as well as any
other relevant equitable considerations. Benefits received by the Company shall be deemed to be
equal to the total net proceeds from the offering (before deducting expenses) received by it, and
benefits received by the Underwriters shall be deemed to be equal to the total underwriting
discounts and commissions, in each case as set forth on the cover page of the Final Prospectus.
Relative fault shall be determined by reference to, among other

13

 

things, whether any untrue or any alleged untrue statement of a material fact or the omission
or alleged omission to state a material fact relates to information provided by the Company on the
one hand or the Underwriters on the other, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such untrue statement or omission. The
Company and the Underwriters agree that it would not be just and equitable if contribution were
determined by pro rata allocation or any other method of allocation which does not take account of
the equitable considerations referred to above. Notwithstanding the provisions of this paragraph
(d), 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. For purposes of this Section 7, each person who controls an Underwriter within
the meaning of the Act and each director, officer, employee and agent of an Underwriter shall have
the same rights to contribution as such Underwriter, and each person who controls the Company
within the meaning of the Act, each officer of the Company and each director of the Company shall
have the same rights to contribution as the Company, subject in each case to the applicable terms
and conditions of this paragraph (d).

          8.      Default by an Underwriter. If any one or more Underwriters shall fail to purchase
and pay for any of the Securities agreed to be purchased by such Underwriter or Underwriters
hereunder and such failure to purchase shall constitute a default in the performance of its or
their obligations under this Agreement, then the Representative shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting Underwriters, or any
other underwriters, to purchase all, but not less than all of the unsold Securities in such amounts
as may be agreed upon and upon the terms herein set forth; if, however, the Representative shall
not have completed such arrangements within such 24-hour period, then the non-defaulting
Underwriters shall be obligated severally to take up and pay for (in the respective proportions
which the principal amount of Securities set forth opposite their names in Schedule II
hereto bears to the aggregate principal amount of Securities set forth opposite the names of all
the non-defaulting Underwriters) the Securities which the defaulting Underwriter or Underwriters
agreed but failed to purchase. Nothing contained in this Agreement shall relieve any defaulting
Underwriter of its liability, if any, to the Company and any non-defaulting Underwriter for damages
occasioned by its default hereunder.

          9.      Termination. This Agreement shall be subject to termination in the absolute
discretion of the Representative, by notice given to the Company prior to delivery of and payment
for the Securities, if at any time prior to such time, (i) trading in securities generally on the
New York Stock Exchange or the Nasdaq National Market shall have been suspended or limited or
minimum prices shall have been established on any of such Exchanges, (ii) a banking moratorium
shall have been declared either by authorities in the United States or New York state, (iii) there
shall have occurred a change or development involving a prospective change in United States
taxation affecting the Securities or the transfer thereof or the imposition of exchange controls by
the United States, or (iv) there shall have occurred any outbreak or escalation of hostilities,
except as existing with similar severity on the date hereof involving the United States,
declaration by the United States of a national emergency or war, or other calamity or crisis,
except as existing with similar severity on the date hereof the effect of which on financial markets

14

 

is such as to make it, in the sole judgment of the Representative, impractical or inadvisable
to proceed with the offering or delivery of the Securities as contemplated by the Disclosure
Package and the Final Prospectus.

          10.      Representations and Indemnities to Survive. The respective agreements,
representations, warranties, indemnities and other statements of the Company or its officers and of
the Underwriters set forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation made by or on behalf of any Underwriter or the Company or
any of the officers, directors, employees, agents or controlling persons referred to in Section 7
hereof, and will survive delivery of and payment for the Securities. The provisions of Sections 6
and 7 hereof shall survive the termination or cancellation of this Agreement.

          11.      Notices. All communications hereunder will be in writing and effective only on
receipt, and, if sent to the Representative, will be mailed, delivered or telefaxed to Deutsche
Bank Securities Inc., office of the Legal Department (fax no.: (212) 797-4564) and confirmed to
Senior Counsel, Deutsche Bank Securities Inc. at 60 Wall Street, Floor 36, New York, New York,
10005; or, if sent to the Company, will be mailed, delivered or telefaxed to Pioneer Natural
Resources Company (fax no.: (972) 969-3552) and confirmed to it at 5205 N. O’Connor Boulevard,
Suite 900, Irving, Texas 75039, Attention: General Counsel.

          12.      Successors. This Agreement will inure to the benefit of and be binding upon the
parties hereto and their respective successors and the officers, directors, employees, agents and
controlling persons referred to in Section 7 hereof, and no other person will have any right or
obligation hereunder.

          13.      No Advisory or Fiduciary Responsibility. The Company acknowledges and agrees that
(i) the purchase and sale of the Securities pursuant to this Agreement is an arm’s-length
commercial transaction between the Company, on the one hand, and the Underwriters, on the other,
(ii) in connection therewith and with the process leading to such transaction each Underwriter is
acting solely as a principal and not the agent or fiduciary of the Company, (iii) no Underwriter
has assumed an advisory or fiduciary responsibility in favor of the Company with respect to the
offering contemplated hereby or the process leading thereto (irrespective of whether such
Underwriter has advised or is currently advising the Company on other matters) or any other
obligation to the Company except the obligations expressly set forth in this Agreement and (iv) the
Company has consulted its own legal and financial advisors to the extent it deemed appropriate.
The Company agrees that it will not claim that any Underwriter has rendered advisory services of
any nature or respect, or owes a fiduciary or similar duty to the Company, in connection with such
transaction or the process leading thereto.

          14.      APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED WITHIN THE
STATE OF NEW YORK WITHOUT REGARD TO ANY APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS.

15

 

          15.      Counterparts. This Agreement may be signed in one or more counterparts, each of
which shall constitute an original and all of which together shall constitute one and the same
agreement.

          16.      Headings. The section headings used herein are for convenience only and shall not
affect the construction hereof.

          17.      Definitions. The terms which follow, when used in this Agreement, shall have the
meanings indicated.

     “Act” shall mean the Securities Act of 1933 and the rules and regulations of the
Commission promulgated thereunder.

     “Basic Prospectus” shall mean the final short form shelf prospectus as most recently
amended, if applicable, filed with the Commission, in accordance with the Act.

     “Business Day” shall mean any day other than a Saturday, a Sunday or a day on which
banking institutions are authorized or obligated by law or regulation to close in New York
City.

     “Commission” shall mean the Securities and Exchange Commission.

     “Disclosure Package” shall mean (i) the Basic Prospectus, together with each
Preliminary Final Prospectus that supplements the Basic Prospectus, as amended and
supplemented to the Execution Time, (ii) the Issuer Free Writing Prospectuses, if any,
identified in Schedule III hereto, and (iii) any other Free Writing Prospectus that
the parties hereto shall hereafter expressly agree in writing to treat as part of the
Disclosure Package.

     “Effective Date” shall mean each date and time that any part of the Registration
Statement, any post-effective amendment or amendments thereto became or becomes effective.

     “Environmental Laws” shall mean any United States and other applicable foreign,
federal, provincial, state, local or municipal laws and regulations relating to the
protection of human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants.

     “Exchange Act” shall mean the Securities Exchange Act of 1934 and the rules and
regulations of the Commission promulgated thereunder.

     “Execution Time” shall mean the date and time that this Agreement is executed and
delivered by the parties hereto.

     “Free Writing Prospectus” shall mean a free writing prospectus, as defined in Rule 405
under the Act.

     “Issuer Free Writing Prospectus” shall mean an issuer free writing prospectus, as
defined in Rule 433 under the Act.

16

 

     “Governmental Authority” shall mean any court or governmental agency or body or any
arbitrator of any kind having jurisdiction over the Company or any of its subsidiaries or
any of their properties.

     “Governmental Authorization” shall mean any consent, approval, authorization, order,
permit, license, filing, registration, clearance or qualification of, or with any statute,
order, rule or regulation of any Governmental Authority.

     “Preliminary Final Prospectus” shall mean any preliminary prospectus supplement to the
Basic Prospectus that describes the Securities and the offering thereof and is used by the
Underwriters prior to filing of the Final Prospectus, together with the Basic Prospectus.

     “Trust Indenture Act” shall mean the Trust Indenture Act of 1939, as amended, and the
rules and regulations of the Commission promulgated thereunder.

17

 

If the foregoing is in accordance with your understanding of our agreement, please sign and return
to us the enclosed duplicate hereof, whereupon this letter and your acceptance shall represent a
binding agreement among the Company and the several Underwriters.

	 	 	 	 	 
	 	Very truly yours,
	 
	 
	 	PIONEER NATURAL RESOURCES COMPANY

 	 
	 	By:  	/s/ Richard P. Dealy	 
	 	 	Name: Richard P. Dealy	 	 
	 	 	Title: Executive Vice President	 	 

 

 

	 	 	 	 	 

The foregoing Agreement is hereby confirmed and accepted as of the date first above written.

	 	 	 	 	 
	 	DEUTSCHE BANK SECURITIES INC.

 	 
	 	By:  	/s/ Ben
Smilehensky	 
	 	 	Name: Ben
Smilehensky	 	 
	 	 	Title: MD	 	 
	 

	 	 	 	 	 
	 	 	 
	 	By: 	/s/ Scott Flieger	 
	 	 	Name: Scott Flieger	 	 
	 	 	Title: MD	 	 
	 

For itself and the other several Underwriters

     named in Schedule II to the foregoing

     Agreement.

 

 

SCHEDULE I

Underwriting Agreement dated April 26, 2006

Registration Statement No. 333-88478

Representative: Deutsche Bank Securities Inc.

Title, Purchase Price, Underwritten Commission and Description of Securities:

Title: 6.875% Senior Notes due 2018

Principal amount: US$450,000,000

Purchase price (include accrued interest or amortization, if any): 99.253%

Underwriting commission: 0.650% of the principal amount of Securities

     sold to the Underwriters under this Agreement. The Underwriters

     agree to reimburse expenses incurred by the Company in connection

     with the issuance and sale of the Securities in the amount of $962,500.

Sinking fund provisions: None

Redemption provisions: Make-Whole Call + 50 basis points

Other provisions: None

	 	 	 
	Closing Date, Time and Location:

	 	May 1, 2006 at 10:00 a.m. (Eastern time) at

Milbank, Tweed, Hadley & McCloy LLP

One Chase Manhattan Plaza

New York, New York 10005

Type of Offering: Non-delayed

Date referred to in Section 4(g) after which the Company may offer or sell debt
securities issued or guaranteed by the Company without the consent of the
Representative(s) shall be the earlier of:

(A) 5 days from the date of this Agreement, provided that (i) the Representative
receives written notification in advance of any new offering of debt securities
issued or guaranteed by the Company and (ii) the Underwriters’ selling efforts
with respect to the debt securities offered pursuant to this Agreement have
concluded and trading in such debt securities is continuing; or (B) 30 days from
the date of this Agreement.

Modification of items to be covered by the letter from Ernst & Young LLP delivered
pursuant to Section 5(g) at the Execution Time: None

 

 

SCHEDULE II

	 	 	 	 	 
	 	 	Principal Amount	 
	 	 	of Securities to be	 
	Underwriters	 	Purchased	 
	Deutsche Bank Securities Inc.
	 	US$	283,757,962	 
	Morgan Stanley & Co. Incorporated
	 	 	114,649,682	 
	ABN AMRO Incorporated
	 	 	17,197,452	 
	Barclays Capital Inc.
	 	 	17,197,452	 
	Harris Nesbitt Corp.
	 	 	17,197,452	 
	 
	 	 	 
	 
	 	 	 	 
	Total
	 	US$	450,000,000	 

 

 

SCHEDULE III

Filed Pursuant to Rule 433 of the Act

Registration No. 333-88478

April 26, 2006

Pioneer Natural Resources Company

Pricing Term Sheet

	 	 	 
	Issuer:
	 	Pioneer Natural Resources Company
	Security Type:
	 	SEC Registered
	Principal Amount:
	 	$450,000,000
	Coupon:
	 	6.875%
	Stated Maturity Date:
	 	May 1, 2018
	Issue Price:
	 	99.903% of face amount
	Yield to Maturity:
	 	6.887%
	US Treasury Benchmark:
	 	4.500% due February 2016
	US Treasury Yield:
	 	5.107%
	Spread to US Treasury:
	 	1.78%
	Trade Date:
	 	April 26, 2006
	Original Issue/Settlement Date:
	 	May 1, 2006
	Interest Payment Dates:
	 	May 1 and November 1, commencing
	 
	 	November 1, 2006
	Make Whole Call:
	 	T+ 50 bps
	Sole Book-Running Joint Lead Manager:
	 	Deutsche Bank Securities Inc.
	Joint Lead Manager:
	 	Morgan Stanley & Co. Incorporated
	Co-Managers:
	 	ABN AMRO Incorporated
	 
	 	Barclays Capital Inc.
	 
	 	Harris Nesbitt Corp.

Note: A securities rating is not a recommendation to buy, sell or hold
securities and may be subject to revision or withdrawal at any time.

The issuer has filed a registration statement (including a prospectus) with the SEC for the
offering to which this communication relates. Before you invest, you should read the prospectus in
that registration statement and other documents the issuer has filed with the SEC for more complete
information about the issuer and this offering. You may get these documents for free by visiting
EDGAR on the SEC Web site at www.sec.gov. Alternatively, the issuer, any underwriter or any dealer
participating in the offering will arrange to send you the prospectus if you request it by calling
Deutsche Bank Securities Inc. toll free at 1-800-503-4611.

 

 

ANNEX I

Opinion of Vinson & Elkins, LLP

Counsel to the Company

     (i)      The Company has been duly incorporated and is an existing corporation in good
standing under the laws of the State of Delaware. The Company has corporate power and
authority to own and lease its properties and conduct its business as described in the Disclosure Package and the Final Prospectus.

     (ii)      Pioneer Natural Resources USA, Inc. (“Pioneer USA”) has been duly incorporated and
is an existing corporation in good standing under the laws of the State of Delaware. Pioneer
USA has corporate power and authority to own and lease its properties and conduct its
business as described in the Disclosure Package and the Final Prospectus.

     (iii)      The Company has an authorized capitalization as described in the Disclosure
Package and the Final Prospectus.

     (iv)      The Securities, when issued and delivered, will conform in all material respects
as to legal matters to the description contained in the Disclosure Package and the Final
Prospectus, under the caption “Description of Notes” and “Description of Debt Securities”.

     (v)      The Company has duly authorized, executed and delivered the Underwriting Agreement.

     (vi)      No consent, approval, authorization or order of, or filing with, any governmental
agency or body or any court is required for the consummation of the transactions
contemplated by the Underwriting Agreement in connection with the issuance or sale of the
Securities by the Company, except such as have been obtained and made under the Act, the
Exchange Act or the Trust Indenture Act and such as may be required under state securities
laws.

     (vii)      The execution, delivery and performance of the Underwriting Agreement by the
Company and the issuance and sale of the Securities by the Company will not result in a
breach or violation of any of the terms and provisions of the Restated Certificate of
Incorporation or Bylaws of the Company.

     (viii)      The execution, delivery and performance of the Underwriting Agreement by the
Company and the issuance and sale of the Securities by the Company will not result in a
violation of any statute, any rule or, to our knowledge, any regulation of any governmental
agency or body having jurisdiction over the Company or any subsidiary of the Company or any
of its properties.

I-1

 

     (ix)      The execution, delivery and performance of the Underwriting Agreement and the
issuance and sale of the Securities will not result in a breach or violation of any of the
terms and provisions of, or constitute a default under, any order known to us of any
governmental agency or body in any court having jurisdiction over the Company or any
subsidiary of the Company or any of its properties, or any agreement or instrument included
as an exhibit to a Form 10-K, Form 10-Q or Form 8-K filed by the Company with the Commission
under the Exchange Act, to which the Company or any subsidiary is a party or by which the
Company or any subsidiary is bound or to which any of the properties of the Company or any
such subsidiary is subject.

     (x)      The Company has full corporate power and authority to authorize, issue and sell the
Securities as contemplated by the Underwriting Agreement.

     (xi)      The Registration Statement has become effective under the Act.

     (xii)      The Final Prospectus was filed with the Commission pursuant to Rule 424(b)(5) on
April  , 2006.

     (xiii)      To the best of our knowledge, no stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued and no proceedings for that
purpose have been instituted or are pending or contemplated under the Act.

     (xiv)      The Registration Statement, as of its effective date and as of the date of the
Underwriting Agreement, appears on its face to comply as to form in all material respects
with the requirements of the Act and the rules and regulations issued by the Commission
thereunder.

     (xv)      The Final Prospectus, as of its date, appears on its face to comply as to form in
all material respects with the requirements of the Act and the rules and regulations issued
by the Commission thereunder.

     (xvi)      The Disclosure Package, as of the Initial Sale Time, appears on its face to
comply as to form in all material respects with the requirements of the Act and the rules
and regulations issued by the Commission thereunder.

     (xvii)      The Indenture and the Sixth Supplemental Indenture each have been duly
authorized, executed and delivered by the Company.

     (xviii)      The Indenture has been duly qualified under the Trust Indenture Act.

     (xix)      The Indenture and the Sixth Supplemental Indenture constitute legal, valid and
binding obligations of the Company enforceable against the Company in accordance with their
terms (subject, as to enforcement of legal remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting creditors’ rights generally
from time to time in effect, and, as to remedies of specific performance and injunctive

I-2

 

and other forms of equitable relief, to equitable defenses or principles and to the
discretion of the court before which any proceeding may therefor be brought).

     (xx)      The Securities have been duly authorized and executed and, when authenticated in
accordance with the Indenture and the Sixth Supplemental Indenture and delivered to and paid
for by the Underwriters pursuant to the Underwriting Agreement, will constitute legal, valid
and binding obligations of the Company entitled to the benefits of the Indenture and
enforceable against the Company in accordance with their terms (subject, as to enforcement
of legal remedies, to applicable bankruptcy, reorganization, insolvency, moratorium or other
laws affecting creditors’ rights generally from time to time in effect, and, as to remedies
of specific performance and injunctive and other forms of equitable relief, to equitable
defenses or principles and to the discretion of the court before which any proceeding may
therefor be brought).

     We have participated in conferences with officers and other representatives of the Company,
in-house attorneys for the Company, representatives of the registered public accountants for the
Company, representatives of the Underwriters and counsel for the Underwriters at which the contents
of the Registration Statement, the Disclosure Package, the Final Prospectus and related matters
were discussed and, although we did not verify such information and are not passing on and do not
assume responsibility for, or express any opinion regarding the accuracy, completeness or fairness
of the statements contained in the Registration Statement, the Disclosure Package or the Final
Prospectus, on the basis of the foregoing in the course of acting as counsel to the Company in this
transaction (and relying as to materiality as to factual matters on officers, employees and other
representatives of the Company), no facts have come to our attention that have caused us to believe
that (a) the Registration Statement, at the time it became effective or on the date of the
Underwriting Agreement, 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, (b) the Final Prospectus, as of the date the Final Prospectus was issued and as of the
Closing Date, contained an untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading or (c) the Disclosure Package as of the Initial Sale Time and as of
the Closing Date, contained an untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. We express no opinion, view belief or comment with
respect to the form, accuracy, completeness or fairness of the financial statements, notes or
schedules thereto, other financial data, natural resource reserves or engineering information or
data or estimated future net revenues therefrom, whether or not discounted, included in the
Registration Statement, the Disclosure Package or the Final Prospectus.

I-3

 

ANNEX II

Opinion of General Counsel to the Company

     (i)      The Company is duly qualified to do business as a foreign corporation in good standing in
all jurisdictions where its ownership or leasing of properties or the conduct of its business
requires such qualification, except where the failure so to register or qualify does not have a
material adverse effect on the condition (financial or other), business or results of operations of
the Company and its subsidiaries considered as a whole.

     (ii)      Pioneer Natural Resources USA, Inc. (“Pioneer USA”) is duly qualified to do business as a
foreign corporation in good standing in all jurisdictions where its ownership or leasing of
properties or the conduct of its business requires such qualification, except where the failure so
to register or qualify does not have a material adverse effect on the condition (financial or
other), Underwriters’ business or results of operations of the Company and its subsidiaries
considered as a whole.

     (iii)      All outstanding shares of capital stock of Pioneer USA have been duly authorized and
validly issued, are fully paid and nonassessable and are owned by the Company free and clear of any
liens, encumbrances, equities or claims, except as described in the Registration Statement, the
Disclosure Package and the Final Prospectus, and other than those arising under the Company’s bank
line of credit.

     I have participated in conferences with officers and other representatives of the Company,
representatives of counsel for the Company, representatives of the registered public accountants
for the Company, representatives of the Underwriters and counsel for the Underwriters at which the
contents of the Registration Statement, the Disclosure Package, the Final Prospectus and related
matters were discussed and, although I did not verify such information and am not passing on and do
not assume responsibility for, or express any opinion regarding the accuracy, completeness or
fairness of the statements contained in the Registration Statement, the Disclosure Package or the
Final Prospectus, on the basis of the foregoing in the course of acting as General Counsel to the
Company (and relying as to materiality as to factual matters on officers, employees and other
representatives of the Company), no facts have come to my attention that have caused me to believe
that (a) the Registration Statement, at the time it became effective or on the date of the
Underwriting Agreement, 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, (b) the Final Prospectus, as of the date the Final Prospectus was issued and as of the
Closing Date, contained an untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading or (c) the Disclosure Package as of the Initial Sale Time and as of
the Closing Date, contained an untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. I express no opinion, view belief or comment with
respect to the form, accuracy,

II-I

 

completeness or fairness of the financial statements, notes or schedules thereto, other
financial data, natural resource reserves or engineering information or data or estimated future
net revenues therefrom, whether or not discounted, included in the Registration Statement, the
Disclosure Package or the Final Prospectus.

II-2<PAGE>
                                                                   Exhibit 10.13

================================================================================

                         SAMCO REORGANIZATION AGREEMENT

                                      AMONG

                             PENSON WORLDWIDE, INC.

                               SAI HOLDINGS, INC.

                         PENSON FINANCIAL SERVICES, INC.

                                       AND

                           SAMCO CAPITAL MARKETS, INC.

                              SAMCO HOLDINGS, INC.

                            DATED ____________, 2006

================================================================================

<PAGE>

                         SAMCO REORGANIZATION AGREEMENT

      SAMCO REORGANIZATION AGREEMENT (this "Agreement"), dated as of
__________________, 2006, by and between Penson Worldwide, Inc. ("PWI"), SAI
Holdings, Inc. ("SAI") and Penson Financial Services, Inc. ("PFSI" and together
with PWI and SAI the "Contributors" and each a "Contributor") and SAMCO Capital
Markets, Inc. a Texas corporation ("SCMI") and SAMCO Holdings, Inc., a Texas
corporation (the "SHI").

      WHEREAS, SAI and PFSI are, direct or indirect, wholly owned subsidiaries
of PWI and are primarily engaged in the business of providing securities
processing infrastructure products and services.

      WHEREAS, in preparation for the initial public offering of PWI stock (the
"IPO"), the Contributors have determined that they should focus their activities
on their core business operations and have, therefore, determined to reorganize
certain of their non-core business operations (including the SAMCO Capital
Markets Business currently operated by PFSI) under a new holding company, SHI.

      WHEREAS, in conjunction with its IPO, and conditional upon the IPO
becoming effective, PWI intends to offer to its shareholders the opportunity to
exchange shares of common stock of PWI for the capital stock of SHI. The entire
capital stock of SHI will be offered in exchange for an aggregate of 2.5 million
(pre split) shares of common stock of PWI (the "Penson Exchange Stock").

      NOW, THEREFORE, in consideration of the foregoing, and the
representations, warranties, covenants and agreements herein contained, the
receipt and adequacy of which is hereby acknowledged, the parties hereto agree
as follows:

                                   ARTICLE I

                                   DEFINITIONS

      SECTION 1.01. Definitions. The following terms, as used herein, have the
following meanings:

      "Ancillary Agreements" means the conveyance documents as set forth in
Exhibit E, the Transition Services Agreement, the Confidentiality Agreement and
the Subleases.

      "Assumed Liabilities" means liabilities, obligations and commitments
identified on Exhibit C.

      "Bank Liens" means any Liens granted by any Contributor to the Guaranty
Bank.

      "Cash Contribution" means the capital contribution to be made by PWI to
SHI in cash in an amount equal to the sum of (1) the product of the Penson
Exchange Stock multiplied by the

                                       2
<PAGE>

Penson Offering Price minus (2) the sum of the SAMCO Net Book Value and the
Keefe Net Book Value.

      "Closing Date" means the date of the SCM Closing.

      "Confidentiality Agreement" means the Confidentiality and Non-Disclosure
Agreement, substantially in the form of Exhibit K.

      "Excluded Assets" means the assets, properties and rights of PFSI listed
on Exhibit B.

      "Excluded Liabilities" means any liabilities, obligations and commitments
of relating to or arising out of the following:

      (i) any liability in respect of any Excluded Asset;

      (ii) any liability in respect of bank credit facilities of the
Contributors; and

      (iii) except as otherwise expressly provided herein, liabilities for any
Tax relating to or arising out of PFSI's operation of the SCM Business or the
operations of SFSI, SFAI or SBD, which accrues, or with respect to any event or
time period occurring, at or prior to the Closing Date.

      "IRS" shall mean the Internal Revenue Service.

      "Keefe Securities" means the securities identified on Exhibit D.

      "Keefe Net Book Value" means the net book value, as shown in the books of
PWI at March 31, 2006, of the Keefe Securities.

      "Lien" means any mortgage, liability, lien (including any tax lien),
pledge, charge, security interest or encumbrance of any kind, other than a
Permitted Lien.

      "Material Agreements" means all contracts, agreements, leases, licenses,
commitments, sales and purchase orders described on Exhibit F.

      "Penson Offering Price" means the initial offering price of a share of
common stock of PWI in the IPO.

      "Person" means an individual, corporation, partnership, association, trust
or other entity or organization, including a government or political subdivision
or an agency or instrumentality thereof.

      "Permits" means the licenses, permits, certificates of authority,
authorizations, approvals and consents issued by any governmental or regulating
authority described on Exhibit G.

      "Permitted Lien" means (a) any Lien for Taxes, assessments and other
governmental charges not yet due and (b) unfiled mortgages, liabilities, liens,
pledges, charges, security interests or encumbrances of any kind arising or
incurred in the ordinary course of business.

                                       3
<PAGE>

      "PFSI Distribution" means the distribution by PFSI to SAI pursuant to
Section 3.01(a).

      "PWI Contribution" means the capital contribution by PWI to SHI pursuant
to Section 3.02.

      "SAI Distribution" means the distribution by SAI to PWI pursuant to
Section 3.01(b).

      "SAMCO Net Book Value" means the net book value, as shown in the books of
PWI at March 31, 2006, of the SFSI Securities, SFAI Securities and SBD
Securities and SCM Assets.

      "SAMCO Securities" means collectively the SCMI Securities, SFSI
Securities, SFAI Securities and SBD Securities.

      "SBD" means SAMCO BD LLC.

      "SBD Securities" means all of the membership interests in SBD.

      "SCM Assets" means the properties, assets and rights of every kind,
nature, character and description (whether tangible or intangible, whether
absolute, accrued, contingent, fixed or otherwise and wherever situated)
primarily used in the SCM Business including, without limitation, all right,
title and interest in and to the assets listed on Exhibit A, the Material
Agreements, the Permits and all goodwill associated with SCM Assets or the SCM
Business; provided, that "SCM Assets" shall not include the Excluded Assets.

      "SCM Business" means the activities primarily associated with the SAMCO
Capital Markets Division operated by PFSI prior to the SCM Closing.

      "SCM Closing" has the meaning ascribed in Section 2.05.

      "SCM Division Employee" means the persons employed by PFSI prior to the
date of the SCM Closing in the SCM Business, as further identified in Exhibit H.

      "SCMI Contribution Securities" means all of the securities of SCMI issued
to PFSI in respect of the contribution of the SCM Assets.

      "SCMI Securities" means all of the issued and outstanding securities of
SCMI.

      "SFAI" means SAMCO Financial Advisors Inc.

      "SFAI Securities" means all of the issued and outstanding securities of
SFAI.

      "SFSI" means SAMCO Financial Services Inc.

      "SFSI Securities" means all of the issued and outstanding securities of
SFSI.

      "SHI Securities" means the issued and outstanding securities of SHI.

      "Subleases" means those certain Sublease Agreements in respect of premises
occupied by SAMCO Companies identified on Exhibit J.

                                       4
<PAGE>

      "Tax" means any net income, alternative or add-on minimum, gross income,
gross receipts, sales, use, ad valorem, franchise, capital, paid-up capital,
profits, greenmail, license, withholding, payroll, employment, excise,
severance, stamp, occupation, premium, property, environmental or windfall
profit tax, custom, duty or other tax, governmental fee or other like assessment
or charge of any kind whatsoever, together with any interest or any penalty,
addition to tax or additional amount imposed by any governmental authority
(domestic or foreign) responsible for the imposition of any such tax.

      "Transition Services Agreement" means that certain Transition Services
Agreement between PWI and SHI substantially in the form attached as Exhibit I.

                                   ARTICLE II

                     REORGANIZATION OF SAMCO CAPITAL MARKETS

      SECTION 2.01. Contribution of SCM Assets. Upon the terms and subject to
the conditions set forth in this Agreement, effective as of the SCM Closing,
PFSI shall contribute and otherwise convey, transfer, assign and deliver to
SCMI, and SCMI shall purchase and accept from the PFSI all right, title and
interest of in and to the SCM Assets, wherever located, free and clear of all
Liens except Permitted Liens and the Assumed Liabilities. SCMI acknowledges and
agrees that Excluded Assets are not being acquired by SCMI and are not part of
the SCM Assets.

      SECTION 2.02. Assumption of Liabilities. At the SCM Closing, SCMI shall
assume, and from and after the Closing Date, shall agree to perform, pay, honor
and discharge when due the Assumed Liabilities; provided that SCMI shall not
assume, and the Assumed Liabilities shall not include, any Excluded Liabilities.

      SECTION 2.03. Assignment of Contracts and Rights. Anything in this
Agreement to the contrary notwithstanding, this Agreement shall not constitute
an agreement to assign any SCM Asset or any claim or right or any benefit
arising thereunder or resulting therefrom if an attempted assignment thereof,
without consent of a third party thereto (which consent has not been obtained)
would constitute a breach or other contravention thereof or in any way adversely
affect the rights of SCMI or PFSI thereunder. SCMI and PFSI will use their
commercially reasonable efforts (but without any payment of money by SCMI or
PFSI) to obtain the consent of the other parties to any such SCM Asset or claim
or right or any benefit arising thereunder for the assignment thereof to SCMI as
SCMI may request. If such consent is not obtained, or if an attempted assignment
thereof would be ineffective or would adversely affect the rights of PFSI
thereunder so that SCMI would not in fact receive all such rights, SCMI and PFSI
will cooperate in a mutually agreeable arrangement under which SCMI would obtain
the benefits and assume the obligations thereunder in accordance with this
Agreement, including, without limitation, subcontracting, sub-licensing, or
subleasing to SCMI, or under which PFSI would enforce for the benefit of SCMI,
with SCMI assuming PFSI's obligations, any and all rights of PFSI against a
third party thereto.

      SECTION 2.04. Capital Contribution. In exchange for the capital
contribution by PFSI of the SCM Assets, upon and subject to the terms of this
Agreement, SCMI shall effective

                                       5
<PAGE>

as of the SCM Closing assume the Assumed Liabilities and issue to PFSI the SCMI
Contribution Securities.

      SECTION 2.05. Closing of SCM Asset Contribution. The closing (the "SCM
Closing") of the contribution and transfer of the SCM Assets and the assumption
of the Assumed Liabilities hereunder shall take place at the offices of PWI,
upon satisfaction of the conditions set forth in Article VIII, or at such other
time or place as PFSI shall specify. Unless a different time is specified by
PFSI, the timing of the SCM Closing shall be immediately upon the satisfaction
of the condition stated in Section 7.01(g) and shall be deemed to take place
immediately prior to the PFSI Distribution, SAI Distribution and PWI
Contribution and prior to the IPO becoming effective.

      At the SCM Closing,

            (a) SCMI shall issue to PFSI the SCMI Contribution Securities;

            (b) SCMI and PFSI shall enter into the Bill of Sale and Instrument
of Assignment in substantially the form attached hereto as Exhibit E, and PFSI
shall deliver to SCMI (i) such deeds, assignments of leases, bills of sale,
endorsements, consents, assignments and other good and sufficient instruments of
conveyance and assignment as the parties and their respective counsel shall deem
reasonably necessary or appropriate to vest in SCMI all right, title and
interest in, to and under the SCM Assets and (ii) all of the SCM Assets;

            (c) PFSI shall deliver, to the extent available, copies of all third
party consents required for the transfer of the SCM Assets and Assumed
Liabilities;

            (d) the applicable parties shall enter into the Subleases;

            (e) PWI and SHI shall enter into the Transition Services Agreement;

            (f) the Contributors, SCMI, SFSI, SFAI and SHI shall enter into the
Confidentiality Agreement; and

            (g) PFSI and SCMI shall also execute and deliver all such
instruments, documents and certificates as may be reasonably requested by the
other party that are necessary, appropriate or desirable for the consummation at
the SCM Closing of the transactions contemplated by this Agreement.

      SECTION 2.06. Employee Matters.

            (a) PFSI agrees to make SCM Division Employees an offer of transfer
of their employment to SCMI on terms initially no less favorable than presently
applicable to such employee ("Transfer Offer"). For those SCM Division Employees
who accept the Transfer Offer ("Transferred Employees"), PFSI shall transfer to
SCMI immediately after the SCM Closing, all personnel files and employment
information on each Transferred Employee, including the Transfer Offer signed by
each Transferred Employee. For those SCM Division Employees who do not accept
the Transfer Offer ("Terminated Employees"), PFSI shall terminate their
employment immediately prior to the SCM Closing, to be effective immediately
after the SCM

                                       6
<PAGE>

Closing. SCMI hereby agrees to assume any liability incurred by a Contributor as
a result of the termination (the "Termination Liability") of any SCM Division
Employee other than any liability for any wages, salary, benefits (other than
severance, pay in lieu of notice or other termination related claims) or related
employment taxes accrued prior to the Closing Date, and to indemnify and hold
the Contributors harmless from any such liability, which liability shall be
deemed to be an Assumed Liability hereunder.

            (b) Nothing contained in this Agreement shall confer upon any SCM
Division Employee any right with respect to employment, or continuance thereof,
with SCMI nor shall anything herein interfere with the right of SCMI to
terminate the employment of any of the SCM Division Employees at any time, with
or without cause, or restrict SCMI in the exercise of its independent business
judgment in modifying any of the terms and conditions of the employment of the
SCM Division Employees.

      SECTION 2.07. Closing Costs; Transfer Taxes and Fees; Proration

            (a) SCMI shall be responsible for (i) any documentary and transfer
taxes and any sales, use or other taxes imposed by reason of the transfers of
SCM Assets and any deficiency, interest or penalty asserted with respect
thereto, and (ii) the fees and costs of recording or filing all applicable
conveyancing instruments. The parties shall otherwise bear their own expenses.
PFSI and SCMI shall negotiate in good faith to mutually agree on the allocations
of basis or deemed purchase price required to arrive at any valuations upon
which such taxes are based. The parties shall co-operate with each other in the
production of any necessary Tax filings in connection with the foregoing.

                                  ARTICLE III

              CONTRIBUTION OF SAMCO SECURITIES AND KEEFE SECURITIES

      SECTION 3.01. Distribution of SCMI Securities.

            (a) Effective immediately following the SCM Closing, PFSI shall make
a distribution of the SCMI Contribution Securities to SAI.

            (b) Upon receipt of the PFSI Distribution, SAI shall make a
distribution of the SCMI Securities, SFSI Securities, SFAI Securities and Keefe
Securities to PWI.

      SECTION 3.02. Capital Contribution to SHI.

            (a) Effective immediately following the distributions set forth in
Section 3.01 and immediately prior to the effectiveness of the IPO, PWI shall
contribute to SHI, as a capital contribution, the SAMCO Securities and the Keefe
Securities.

            (b) Upon the SCM Closing, PWI agrees to make the Cash Contribution.

                                       7
<PAGE>

                                   ARTICLE IV

                 REPRESENTATIONS AND WARRANTIES OF CONTRIBUTORS

      EXCEPT AS EXPRESSLY SET FORTH IN THIS ARTICLE IV, NO CONTRIBUTOR MAKES ANY
WARRANTIES RELATED TO THE SCM ASSETS, THE ASSUMED LIABILITIES, THE SAMCO
SECURITIES OR OTHERWISE AND ALL SCM ASSETS AND SAMCO SECURITIES ARE SOLD,
LICENSED OR CONVEYED "AS IS" AND "WHERE IS" WITHOUT WARRANTY, EXPRESS OR
IMPLIED, AND ALL OTHER WARRANTIES INCLUDING, WITHOUT LIMITATION, IMPLIED
WARRANTIES AS TO TITLE, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND
NONINFRINGEMENT OF INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES ARE HEREBY
DISCLAIMED.

      Each Contributor hereby severally represents and warrants to SCMI and SHI,
as applicable, and as to itself only, that:

      SECTION 4.01. Organization and Qualification. Such Contributor is a
corporation duly organized, validly existing and in good standing under the laws
of its state of incorporation and has the requisite corporate power and
authority to enter into this Agreement and the Ancillary Agreements to which it
is party and to perform its obligations hereunder.

      SECTION 4.02. Corporate Authorization. The execution, delivery and
performance by such Contributor of this Agreement and each of the Ancillary
Agreements to which it is party, and the consummation by such Contributor of the
transactions contemplated hereby and thereby have been duly authorized by all
necessary corporate action on the part of such Contributor. This Agreement and
each of the Ancillary Agreements to which it is party, have been, or, in the
case of the Ancillary Agreements, will be, duly executed and delivered by such
Contributor and constitute valid and binding agreements of such Contributor,
enforceable against such Contributor in accordance with their respective terms,
except to the extent that enforceability may be limited by applicable
bankruptcy, moratorium, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally, and by principles of
equity.

      SECTION 4.03. Governmental Authorization. The execution, delivery and
performance by such Contributor of this Agreement and each of the Ancillary
Agreements to which it is party, and the consummation by such Contributor of the
transactions contemplated hereby and thereby, do not require any action by or in
respect of, or filing with, any governmental body, agency, official or
authority, other than with respect to the approvals required from the National
Association of Securities Dealers.

      SECTION 4.04. Title to Contributed Assets. Neither the SCM Assets not the
SAMCO Securities are subject to any Lien other than (i) Permitted Liens; and
(ii) the Bank Liens. Upon consummation of the transactions contemplated hereby,
Contributors will have transferred to SCMI or SHI as applicable good and
marketable title in and to, or a valid leasehold interest in, each of the SCM
Assets and SAMCO Securities, free and clear of all Liens other than Permitted
Liens and Assumed Liabilities.

                                       8
<PAGE>

                                   ARTICLE V

                 REPRESENTATIONS AND WARRANTIES OF SCMI AND SHI

      Each of SCMI and SHI hereby jointly and severally represents and warrants
to each Contributor that:

      SECTION 5.01. Organization and Qualification. Each of SCMI and SHI is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Texas and has the requisite corporate power and authority to
own, lease and operate its properties and to carry on its business as it is now
being conducted. Each of SCMI and SHI is duly qualified or licensed to do
business, and is in good standing (to the extent applicable), in each
jurisdiction where the nature of its business or proposed business makes such
qualification or licensing necessary.

      SECTION 5.02. Corporate Authorization. Each of SCMI and SHI has the
necessary corporate power and authority to execute and deliver this Agreement
and each of the Ancillary Agreements to which it is party, to perform its
obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby. The execution, delivery and performance by each
of SCMI and SHI of this Agreement, and each of the Ancillary Agreements to which
it is party, and the consummation by each of SCMI and SHI of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
corporate action on the part of each of SCMI and SHI. This Agreement and each of
the Ancillary Agreements to which they are party have been, or, in the case of
the Ancillary Agreements, will be, duly executed and delivered by each of SCMI
and SHI and constitute valid and binding agreements of each of SCMI and SHI,
enforceable against them in accordance with their respective terms, except to
the extent that enforceability may be limited by applicable bankruptcy,
moratorium, insolvency, reorganization or other similar laws affecting the
enforcement of creditors' rights generally, and by principles of equity.

      SECTION 5.03. Governmental Authorization. The execution, delivery and
performance by each of SCMI and SHI of this Agreement and each of the Ancillary
Agreements to which they are party, and the consummation by each of SCMI and SHI
of the transactions contemplated hereby and thereby, do not require any action
by or in respect of, or filing with, any governmental body, agency, official or
authority, other than with respect to the approvals required from the National
Association of Securities Dealers.

      SECTION 5.04. Title to SAMCO Securities and SHI Securities . All of the
SAMCO Securities and SHI Securities have been duly authorized and validly issued
and are fully paid and nonassessable. None of the SAMCO Securities or SHI
Securities were issued in violation of the Securities Act of 1933 or any other
law or regulation applicable to SCMI or SHI. Upon consummation of the
transactions contemplated hereby, PWI will have good and marketable title in and
to the SHI Securities, free and clear of all Liens.

                                       9
<PAGE>

                                   ARTICLE VI

                            COVENANTS OF THE PARTIES

      SECTION 6.01. Further Assurances.

            (a) Subject to the terms and conditions of this Agreement, each
party will use its reasonable commercial efforts to take, or cause to be taken,
all actions and to do, or cause to be done, all things necessary or desirable
under applicable laws and regulations to consummate the transactions
contemplated by this Agreement. Each party shall execute and deliver such other
documents, certificates, agreements and other writings and take such other
actions as may be necessary or desirable in order to consummate or implement
expeditiously the transactions contemplated by this Agreement and to vest good
and marketable title to the SCM Assets and SAMCO Securities and SHI Securities.

            (b) After the Closing Date, upon reasonable written notice, each
party shall furnish or cause to be furnished to each other and their employees,
counsel, auditors and representatives access, during normal business hours, such
information and assistance relating to or affecting the SCM Assets and SAMCO
Securities (to the extent within the control of such party) as is reasonably
necessary for financial reporting and accounting matters.

            (c) After the Closing Date, upon reasonable written notice, each
party shall furnish or cause to be furnished to each other, as promptly as
practicable, such information and assistance (to the extent within the control
of such party) relating to the SCM Assets and SAMCO Securities (including,
access to books and records) as is reasonably necessary for the filing of all
Tax returns, and making of any election related to Taxes, the preparation for
any audit by any taxing authority, and the prosecution or defense of any claim,
suit or proceeding related to any Tax return. The parties shall cooperate with
each other in the conduct of any audit or other proceeding relating to Taxes
involving the SCM Business or the SAMCO Securities.

            (d) Neither party shall be required by this section to take any
action that would unreasonably interfere with the conduct of its business or
unreasonably disrupt its normal operations. Any information received by a
Contributor relating to SCMI, SFSI, SFAI or SHI, and all information relating to
a Contributor received by SCMI, SFSI, SFAI or SHI, shall be subject to the
Confidentiality Agreement.

      SECTION 6.02. Certain Filings. The parties shall cooperate with one
another (a) in determining whether any action by, or in respect of, or filing
with, any governmental body, agency, official or authority is required, or any
actions, consents, approvals or waivers are required to be obtained from parties
to any material contracts, in connection with the consummation of the
transactions contemplated by this Agreement and the Ancillary Agreements and (b)
in taking such actions or making any such filings, furnishing information
required in connection therewith and seeking timely to obtain any such actions,
consents, approvals or waivers.

      SECTION 6.03. Confidentiality. The parties hereto shall comply with, and
shall cause their respective officers, directors , employees and representatives
to comply with, all of

                                       10
<PAGE>

their respective obligations under the Confidentiality Agreement with respect to
the information disclosed in connection with or pursuant to this Agreement

      SECTION 6.04. Allocation of Tax Costs. In the Event that the Penson Stock
Exchange shall be determined to be a taxable transaction rather than a tax free
split off, SHI and PWI acknowledge and agree that the costs of any taxes that
have to be paid by any Contributor or by SHI or its subsidiaries shall be for
the account of SHI and SHI agrees to indemnify and hold harmless PWI and the
other Contributors from any such taxes paid by them in connection with the
Penson Stock Exchange or the transactions contemplated by this Agreement.

                                  ARTICLE VII

                              CONDITIONS TO CLOSING

      SECTION 7.01. Conditions to the Obligations of Each Party. The obligations
of the parties to consummate the transactions contemplated hereby are subject to
the satisfaction of the following conditions:

            (a) No judgment, injunction, order or decree shall have been issued
declaring this Agreement invalid, nor shall any judgment, injunction, order,
decree or applicable Law prohibit the consummation of the transactions
contemplated hereby;

            (b) SCMI and SHI and each Contributor shall have executed and
delivered to the other each of the Ancillary Agreements to which it is party;

            (c) The approval of Guaranty Bank to the transactions contemplated
by this Agreement, and the release of all Bank Liens and any other related
encumbrances upon the SCM Assets, SAMCO Securities and Keefe Securities;

            (d) All actions by or in respect of or filings with any governmental
body, agency, official or authority required to permit the consummation of the
transactions contemplated hereby shall have been obtained;

            (e) (i) Each party shall have performed in all material respects all
of its covenants and obligations hereunder required to be performed by it at or
prior to the Closing Date, (ii) the representations and warranties of the
parties contained in this Agreement and in any certificate or other writing
delivered pursuant hereto shall be true and correct in all material respects;

            (f) SHI, SCMI, SFSI and SFAI shall have received all consents,
authorizations or approvals from the NASD in form and substance satisfactory to
the parties for the transfer of the SCM Assets and SAMCO Securities and no such
authorization or approval shall have been withdrawn; and

            (g) The Securities and Exchange Commission shall have confirmed to
PWI its agreement to declare the S-1 Registration Statement relating to PWI's
IPO effective upon PWI's request.

                                       11
<PAGE>

                                  ARTICLE VIII

                                   TERMINATION

      SECTION 8.01. Grounds for Termination. This Agreement may be terminated at
any time prior to the SCM Closing by mutual written agreement of PWI and SHI.

                                   ARTICLE IX

                                  MISCELLANEOUS

      SECTION 9.01. Notices. All notices, requests and other communications to
either party hereunder shall be in writing (including telex, telecopy or similar
writing) and shall be given,

         if to SHI or SCMI, to:

                  SAMCO Holdings, Inc.
                  6805 Capitol of Texas Highway
                  Suite 350
                  Austin, Texas 78701
                  Attention: Chairman

         if to a Contributor, to:

                  Penson Worldwide, Inc.
                  1700 Pacific Avenue, Suite 1400
                  Dallas Texas 75201
                  Attention: President

      SECTION 9.02. Amendments; No Waivers.

            (a) Any provisions of this Agreement may be amended or waived prior
to the SCM Closing Date if, and only if, such amendment or waiver is in writing
and signed, in the case of an amendment, by the parties, or in the case of a
waiver, by the party waiving its right or claim.

            (b) No failure or delay by any party in exercising any right, power
or privilege hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise thereof preclude any other or further exercise thereof or
the exercise of any other right, power or privilege. The rights and remedies
herein provided shall be cumulative and not exclusive of any rights or remedies
provided by law.

      SECTION 9.03. Expenses. Except as otherwise provided herein, all costs and
expenses incurred in connection with this Agreement shall be paid by the party
incurring such

                                       12
<PAGE>

cost or expense. PFSI shall pay all recording and filing fees that may be
imposed by reason of the sale, transfer, assignment and delivery of the SCM
Assets.

      SECTION 9.04. Successors and Assigns. Except as otherwise provided in this
Agreement, no party hereto shall assign this Agreement or any rights or
obligations hereunder without the prior written consent of the other parties
hereto and any such attempted assignment without such prior written consent
shall be void and of no force and effect. The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.

      SECTION 9.05. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS OTHER
THAN CONFLICT OF LAWS PRINCIPLES THEREOF DIRECTING THE APPLICATION OF ANY LAW
OTHER THAN THAT OF THE STATE OF TEXAS.

      SECTION 9.06. Counterparts; Effectiveness. This Agreement may be signed in
any number of counterparts (including by facsimile), each of which shall be an
original, with the same effect as if the signatures thereto and hereto were upon
the same instrument. This Agreement shall become effective when each party
hereto shall have received a counterpart hereof signed by the other party
hereto.

      SECTION 9.07. Entire Agreement; Severability. This Agreement (including
the Exhibits and Schedules hereto) and the Ancillary Agreements all constitute
the entire agreement between the parties with respect to the subject matter
hereof and supersede all prior agreements, understandings and negotiations, both
written and oral, between the parties with respect to the subject matter of this
Agreement. None of this Agreement nor the Ancillary Agreements are intended to
confer upon any person other than the parties hereto any rights or remedies
hereunder. If any term or other provision of this Agreement is invalid, illegal
or incapable of being enforced by any rule of law or public policy, all other
terms and provisions of this Agreement shall nevertheless remain in full force
and effect. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in a mutually acceptable manner to the fullest
extent permitted by applicable law.

      SECTION 9.08. Bulk Sales Laws. SCMI, SHI and the Contributors each hereby
waive compliance by the Contributors with the provisions of the "bulk sales",
"bulk transfer" or similar laws of any state.

      SECTION 9.09. Headings; Interpretation. The descriptive headings contained
in this Agreement are included for convenience of reference only and shall not
affect in any way the meaning or interpretation of this Agreement. The parties
have participated jointly in the negotiation and drafting of this Agreement. In
the event an ambiguity or question of intent or interpretation arises, this
Agreement shall be construed as if drafted jointly by the parties, and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any provisions of this Agreement.

                                       13
<PAGE>

      SECTION 9.10. Incorporation of Exhibits and Schedules. The Exhibits and
Schedules referred to in this Agreement are incorporated herein and made a part
hereof.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

                                       14
<PAGE>

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers on the day and year first
above written.

                                     PENSON WORLDWIDE, INC.

                                     By:
                                        ---------------------------------------
                                     Name:
                                     Title:

                                     SAI HOLDINGS, INC.

                                     By:
                                        ---------------------------------------
                                     Name:
                                     Title:

                                     PENSON FINANCIAL SERVICES, INC.

                                     By:
                                        ---------------------------------------
                                     Name:
                                     Title:

                                     SAMCO HOLDINGS, INC.

                                     By:
                                        ---------------------------------------
                                     Name:
                                     Title:

                                     SAMCO CAPITAL MARKETS, INC.

                                     By:
                                        ---------------------------------------
                                     Name:
                                     Title:

               [Signature Page to SAMCO Reorganization Agreement]

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