<PAGE>
As filed with the Securities and Exchange Commission on March 29,
1995
=================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
___________________
FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
SOUTHERN UNION COMPANY Delaware 75-0571592
SOUTHERN UNION FINANCING I Delaware To Be Applied For
SOUTHERN UNION FINANCING II Delaware To Be Applied For
SOUTHERN UNION FINANCING III Delaware To Be Applied For
(Exact name of Registrant as (State or other (I.R.S. Employer
specified in its Charter) Jurisdiction of Identification
Incorporation Number)
or Organization)
504 Lavaca Street, Suite 800
Austin, Texas 78701
(512) 477-5852
(Address, including zip code, and telephone number,
including area code, of each registrant's principal
executive offices)
__________________
Dennis K. Morgan, Esq. With a copy to:
Vice President-Legal and Secretary Stephen A. Bouchard,Esq.
SOUTHERN UNION COMPANY Fleischman and Walsh, L.L.P.
504 Lavaca Street, Suite 800 1400 Sixteenth Street, N.W.,
Suite 600
Austin, Texas 78701 Washington, D.C. 20036
(512) 477-5852 (202) 939-7911
(Name, address, including zip code,
and telephone number, including
area code, of agent for service
for each registrant)
________________________
Approximate Date of Commencement of Proposed Sale to Public:
From time to time after the effective date of the Registration
Statement, as determined by market conditions.
________________________
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans, please
check the following blank:
_____
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, other than securities offered only in
connection with dividend or interest reinvestment plans, please
check the following blank: X
_____
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Maximum Maximum
Offering Aggregate Amount of
Title of Each Class Amount to Price Per Offering Registra-
of Securities to be be Regis- Unit Price tion Fee
Registered tered (1) (1)(2)(3) (1)(2)(3) (2)
___________________ _________ _________ _________ _________
Preferred Securities
of Southern Union
Financing I. . . .
Preferred Securities
of Southern Union
Financing II . . .
Preferred Securities
of Southern Union
Financing III. . .
Senior Debt Securi-
ties of Southern
Union Company. . .
Guarantees of Pre-
ferred Securities
of Southern Union
Financing I,
Southern Union
Financing II,
Southern Union
Financing III by
Southern Union
Company (4). . . .
_________________________________________________________________
Total $300,000,000 100% $300,000,000 $103,449.00
(1) Such indeterminate number of Preferred Securities of Southern
Union Financing I, Southern Union Financing II and Southern
Union Financing III and such indeterminate principal amount of
Senior or Subordinated Debt Securities of Southern Union
Company as may from time to time be issued at indeterminate
prices. Subordinated Debt Securities may be issued and sold
to Southern Union Financing I, Southern Union Financing II and
Southern Union Financing III, in which event such Subordinated
Debt Securities may later be distributed to the holders of
Preferred Securities upon a dissolution of Southern Union
Financing I, Southern Union Financing II and Southern Union
Financing III and the distribution of the assets thereof.
(2) Estimated solely for the purpose of calculating the
registration fee pursuant to Rule 457. The aggregate public
offering price of the Preferred Securities of Southern Union
Financing I, Southern Union Financing II and Southern Union
Financing III and the Senior or Subordinated Debt Securities
of Southern Union Company registered hereby will not exceed
$300,000,000.
(3) Exclusive of accrued interest and distributions, if any.
(4) No separate consideration will be received for any Guarantees.
The Registrants hereby amend this Registration Statement on such
date or dates as may be necessary to delay its effective date until
the Registrants shall file a further amendment that specifically
states that this Registration Statement shall thereafter become
effective in accordance with Section 8(a) of the Securities Act of
1933 or until the Registration Statement shall become effective
on such date as the Commission, acting pursuant to said Section
8(a) may determine.
=================================================================
<PAGE>
SUBJECT TO COMPLETION, DATED MARCH 29, 1995
PROSPECTUS
__________
$300,000,000
SOUTHERN UNION COMPANY
Senior Debt Securities and Subordinated Debt Securities
Southern Union Financing I
Southern Union Financing II
Southern Union Financing III
Preferred Securities guaranteed to the extent set forth herein by
Southern Union Company
____________________
Southern Union Company ("Southern Union" and, together with its
subsidiaries, the "Company"), a Delaware corporation, may offer,
from time to time, (i) unsecured senior debt securities (the
"Senior Debt Securities") consisting of debentures, notes or other
evidence of indebtedness, and (ii) unsecured subordinated debt
securities (the "Subordinated Debt Securities") consisting of
debentures, notes or other evidence of indebtedness (item (i) or
(ii) above being referred to herein as the "Debt Securities") or
any combination of the foregoing, in each case in one or more
series and in amounts, at prices and on terms to be determined at
or prior to the time of any such offering.
Southern Union Financing I, Southern Union Financing II and
Southern Union Financing III (each, a "Southern Union Trust") each
a Delaware business trust, may offer, from time to time, preferred
securities, representing undivided beneficial interests in the
assets of the respective Southern Union Trust ("Preferred
Securities"). The payment of periodic cash distributions
("distributions") with respect to Preferred Securities out of
moneys held by each of the Southern Union Trusts, and payments on
liquidation, redemption or maturity with respect to the Preferred
Securities, will be guaranteed by Southern Union to the extent
described herein (each a "Guarantee"). See "Description of the
Guarantees" below. Southern Union's obligations under the
Guarantees are subordinate and junior in right of payment to all
other liabilities of Southern Union and rank pari passu with the
most senior preferred stock, if any, issued from time to time by
Southern Union. Subordinated Debt Securities may be issued and
sold from time to time in one or more series by Southern Union to
a Southern Union Trust in connection with the investment of the
proceeds from the offering of Preferred Securities and Common
Securities (as defined herein) of such Southern Union Trust.
The Subordinated Debt Securities purchased by a Southern Union
Trust may be subsequently distributed pro rata to holders of
Preferred Securities and Common Securities in connection with the
dissolution of such Southern Union Trust, upon the occurrence of
certain events as may be described in an accompanying Prospectus
Supplement (a "Prospectus Supplement").
Specific terms of the Debt Securities of any series or the
Preferred Securities of any Southern Union Trust described in this
Prospectus (the "Offered Securities") will be set forth in a
Prospectus Supplement with respect to such Offered Securities,
which will describe, without limitation and where applicable, the
following: (i) in the case of Debt Securities, the specific
designation, aggregate principal amount, denomination, maturity,
premium, if any, any exchange, conversion, redemption or sinking
fund provisions, if any, interest rate (which may be fixed or
variable), if any, the time and method of calculating interest
payments, if any, dates on which premium, if any, and interest,
if any, will be payable, the right of Southern Union, if any, to
defer payment of interest on the Debt Securities and the maximum
length of such deferral period, the initial public offering price,
subordination terms, and any listing on a securities exchange and
other specific terms of the offering; and (ii) in the case of Pre-
ferred Securities, the designation, number of securities,
liquidation preference per security, initial public offering price,
any listing on a securities exchange, distribution rate (or method
of calculation thereof), dates on which distributions shall be
payable and dates from which distributions shall accrue, any voting
rights, terms for any conversion or exchange into other securities,
any redemption, exchange or sinking fund provisions, any other
rights, preferences, privileges, limitations or restrictions
relating to the Preferred Securities and the terms upon which the
proceeds of the sale of the Preferred Securities shall be used to
purchase a specific series of Subordinated Debt Securities of
Southern Union.
The Offered Securities may be offered in amounts, at prices and on
terms to be determined at the time of offering; provided, however,
that, the aggregate initial public offering price of all Offered
Securities shall not exceed $300,000,000. Any Prospectus
Supplement relating to any series of Offered Securities will
contain information concerning certain United States federal income
tax considerations, if applicable, to the Offered Securities.
Southern Union and/or each of the Southern Union Trusts may sell
the Offered Securities directly, through agents designated from
time to time or through underwriters or dealers. See "Plan of
Distribution" below. If any agents of Southern Union and/or any
Southern Union Trust or any underwriters or dealers are involved in
the sale of the Offered Securities, the names of such agents,
underwriters or dealers and any applicable commissions and
discounts will be set forth in any related Prospectus Supplement.
______________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE. THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF
SECURITIES UNLESS ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
______________________
The date of this Prospectus is , 1995.
<PAGE>
Information contained herein is subject to completion or amendment.
A registration statement relating to these securities has been
filed with the Securities and Exchange Commission. These
securities may not be sold, nor may offers to buy be accepted,
prior to the time the registration statement becomes effective.
This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of
these securities in any State in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under
the securities laws of any such State.
<PAGE>
No dealer, salesperson or any other individual has been authorized
by Southern Union or any of the Southern Union Trusts to give any
information or to make any representation other than those
contained or incorporated by reference in this Prospectus or any
accompanying Prospectus Supplement and, if given or made, such
information or representation must not be relied upon as having
been authorized. This Prospectus does not constitute an offer to
sell or a solicitation of an offer to buy any of the securities
offered hereby in any jurisdiction to any person to whom it is
unlawful to make such offer or solicitation in such jurisdiction.
Neither the delivery of this Prospectus nor any sale made hereunder
shall, under any circumstances, create any implication that there
has been no change in the affairs of Southern Union or any of the
Southern Union Trusts since the date hereof.
_______________________
AVAILABLE INFORMATION
This Prospectus constitutes a part of a Registration Statement on
Form S-3 (together with all amendments and exhibits thereto, the
"Registration Statement") filed by Southern Union and the Southern
Union Trusts with the Securities and Exchange Commission (the
"SEC") under the Securities Act of 1933, as amended (the
"Securities Act"), with respect to the Offered Securities. This
Prospectus does not contain all of the information set forth in
such Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the SEC. Reference is
made to such Registration Statement and to the exhibits relating
thereto for further information with respect to the Company, the
Southern Union Trusts and the Offered Securities. Any statements
contained herein concerning the provisions of any document filed as
an exhibit to the Registration Statement or otherwise filed with
the SEC or incorporated by reference herein are not necessarily
complete, and, in each instance, reference is made to the copy of
such document so filed for a more complete description of the
matter involved. Each such statement is qualified in its entirety
by such reference.
Southern Union is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and in accordance therewith files reports, proxy statements and
other information with the SEC. Reports, proxy statements and
other information concerning Southern Union can be inspected and
copied at prescribed rates at the SEC's Public Reference Room,
Judiciary Plaza, 450 Fifth Street, Northwest, Washington, D.C.
20549, as well as the following Regional Offices of the SEC: 7
World Trade Center, New York, New York 10048; and Northwestern
Atrium Center, 500 West Madison Street, Chicago, Illinois
60661-2511. [Such reports, proxy statements and other information
may also be inspected at the offices of the NYSE, on which Southern
Union common stock is traded, at 20 Broad Street, New York, New
York 10005.]
No separate financial statements of any of the Southern Union
Trusts have been included herein. Southern Union does not consider
that such financial statements would be material to holders of the
Preferred Securities because (i) all of the voting securities of
each of the Southern Union Trusts will be owned, directly or
indirectly, by Southern Union, a reporting company under the
Exchange Act, (ii) each of the Southern Union Trusts has no
independent operations but exists for the sole purpose of issuing
securities representing undivided beneficial interests in the
Southern Union Trusts and investing the proceeds thereof in
Subordinated Debt Securities issued by Southern Union, and (iii)
the obligations of each of the Southern Union Trusts under the
Trust Securities (as defined herein) are fully and unconditionally
guaranteed by Southern Union to the extent that funds are avail-
able. See "Particular Terms of the Subordinated Debt Securities"
and "Description of the Guarantees."
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by Southern Union (File No. 1-6407)
with the SEC pursuant to the Exchange Act are incorporated by
reference herein and made a part hereof:
1. Transition Report on Form 10-K for the year ended June 30, 1994
(the "1994 Form 10-K").
2. Quarterly Reports on Form 10-Q for the quarters ended
September 30, 1994 (the "First Quarter Form 10-Q") and
December 31, 1994 (the "Second Quarter Form 10-Q").
<PAGE>
All documents filed by Southern Union pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date
hereof and prior to the termination of the offering of the Offered
Securities pursuant hereto shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date
of filing of such documents.
Any statement contained herein or in a document incorporated or
deemed to be incorporated by reference herein or in any Prospectus
Supplement shall be deemed to be modified or superseded for
purposes of this Prospectus, or in any Prospectus Supplement, to
the extent that a statement contained herein or therein (or in any
other subsequently filed document that also is or is deemed to be
incorporated by reference herein or therein) modifies or supersedes
such statement. Any statement so modified or superseded shall not
be deemed, except as so modified or superseded, to constitute a
part of this Prospectus or any Prospectus Supplement.
Southern Union undertakes to provide without charge to each person
to whom a copy of this Prospectus has been delivered, upon the
written or oral request of any such person, a copy of any or all of
the foregoing documents incorporated herein by reference, other
than exhibits to such documents, unless such exhibits are
specifically incorporated by reference into such documents. Such
requests should be directed to Dennis K. Morgan, Vice President --
Legal and Secretary, Southern Union Company, at 504 Lavaca Street,
Suite 800, Austin, Texas 78701, telephone (512) 477-5852.
SOUTHERN UNION COMPANY
The Company's principal line of business is the distribution of
natural gas as a public utility through Southern Union Gas Company
("Southern Union Gas") and Missouri Gas Energy, each of which is a
division of Southern Union. Southern Union Gas serves
approximately 495,000 residential, commercial, industrial,
agricultural and other customers in Texas (including the cities of
Austin, Brownsville, El Paso, Galveston and Port Arthur) and
Oklahoma. Missouri Gas Energy, acquired on January 31, 1994,
serves approximately 473,000 customers in central and western
Missouri (including the cities of Kansas City, St. Joseph, Joplin
and Monett).
Subsidiaries of Southern Union have been established to support and
expand natural gas sales and to capitalize on the Company's gas
energy expertise. These subsidiaries market natural gas to end-
users, sell natural gas as a vehicular fuel, convert vehicles to
operate on natural gas, operate intrastate and interstate natural
gas pipeline systems, and sell commercial gas air conditioning and
other gas-fired engine-driven applications. By providing "one-stop
shopping," the Company can serve its various customers' particular
energy needs, which encompass substantially all of the natural gas
distribution and sales businesses from natural gas sales to
specialized energy consulting services. Certain subsidiaries also
hold investments in real estate and other assets, which are
primarily used in Southern Union's utility business.
The Company is a sales and market-driven energy company whose
management is committed to achieving profitable growth of its
natural gas energy businesses in an increasingly competitive
business environment. Management's strategies for achieving these
objectives principally consist of (i) promoting new sales
opportunities and markets for natural gas, (ii) enhancing financial
and operating performance, and (iii) expanding the Company through
development of existing systems and selectively acquiring new
systems. Management develops and continually evaluates these
strategies, and the Company's implementation of them, by applying
its experience and expertise in analyzing the energy industry,
technological advances, market opportunities and general business
trends. Each of these strategies, as implemented throughout the
Company's businesses, reflects the Company's commitment to its core
natural gas utility business. Central to all of the Company's
businesses and strategies is the sale and transportation of natural
gas.
Consistent with this strategy, the Company has actively pursued
selected acquisitions in the natural gas distribution,
transportation and sales industries where management believes there
are opportunities to promote new sales of and markets for natural
gas and/or synergies that permit enhanced financial and operating
performance. Since 1990, Southern Union has acquired seven gas
distribution systems in Texas and one in Missouri. Collectively,
these systems have added nearly 587,000 of the Company's present
customers, representing approximately $289,293,000 of annual sales
revenue to Southern Union. See "Acquisitions and Divestiture" in
the Notes to Southern Union's Consolidated Financial Statements
<PAGE>
included in the 1994 Form 10-K. Southern Union's most recent
acquisition was consummated on January 31, 1994, when it acquired
Missouri Gas Energy.
Southern Union was incorporated under the laws of the State of
Delaware in 1932. The Company's corporate headquarters are located
at 504 Lavaca Street, Suite 800, Austin, Texas 78701, and its
telephone number is (512) 477-5852.
THE SOUTHERN UNION FINANCING TRUSTS
Each of Southern Union Financing I, Southern Union Financing II and
Southern Union Financing III is a business trust formed under
Delaware law pursuant to (i) a separate Declaration (each, a
"Declaration") executed by Southern Union, as sponsor for such
trust (the "Sponsor"), and the Southern Union Trustees (as defined
herein) of such trust and (ii) the filing of a certificate of trust
with the Secretary of State of the State of Delaware on March 28,
1995. Each Southern Union Trust exists for the exclusive purposes
of (i) issuing the Preferred Securities and common securities
representing undivided beneficial interests in the assets of the
Trust (the "Common Securities" and, together with the Preferred
Securities, the "Trust Securities") and (ii) investing the gross
proceeds from the sale of the Trust Securities in the Subordinated
Debt Securities. All of the Common Securities will be directly or
indirectly owned by Southern Union. The Common Securities will
rank pari passu, and payments will be made thereon pro rata, with
the Preferred Securities, except that, upon an Event of Default (as
defined herein) under the Indenture (as defined herein), the rights
of the holders of the Common Securities to payment in respect of
distributions and payments upon liquidation, redemption and
maturity will be subordinated to the rights of the holders of the
Preferred Securities. Southern Union will directly or indirectly
acquire Common Securities in an amount equal to 3% of the total
capital of each Southern Union Trust. Each Southern Union Trust
has a term of approximately 55 years, but shall terminate earlier,
as provided in the Declaration. Each Southern Union Trust's
business and affairs will be conducted by the trustees (the
"Southern Union Trustees") appointed by Southern Union as the
direct or indirect holder of all the Common Securities. The holder
of the Common Securities will be entitled to appoint or remove any
of, or increase or reduce the number of, the Southern Union
Trustees of a Southern Union Trust. The duties and obligations of
the Southern Union Trustees shall be governed by the Declaration of
such Southern Union Trust. A majority of the Southern Union
Trustees of each Southern Union Trust will be persons who are
employees or officers of or affiliated with Southern Union (the
"Regular Trustees"). One Southern Union Trustee of each Southern
Union Trust will be a financial institution or an affiliate thereof
who maintains its principal place of business in or who maintains
a residence in the State of Delaware (the "Delaware Trustee"). In
addition, one Southern Union Trustee of each Southern Union Trust,
which shall be an independent trustee that is a bank that has a
specified minimum amount of aggregate capital, surplus, and
undivided profits of not less than $50,000,000, which may also be
the Delaware Trustee, will be designated as a property trustee (the
"Property Trustee"), pursuant to the terms set forth in a
Prospectus Supplement. Southern Union will pay all fees and
expenses related to the creation and administration of the Southern
Union Trusts and to the offering of the Trust Securities. Each
Southern Union Trust's registered office in the State of Delaware
is Wilmington Trust Company, Rodney Square North, 1100 North Market
Street, Wilmington, Delaware 19890. The principal place of
business of each Southern Union Trust is c/o Southern Union
Company, 504 Lavaca Street, Suite 800, Austin, Texas 78701,
telephone (512) 477-5852.
USE OF PROCEEDS
Each Southern Union Trust will use all proceeds received from the
sale of its Preferred Securities to purchase Subordinated Debt
Securities from Southern Union. The Company intends to add the net
proceeds from the sale of the Debt Securities to Southern Union's
general funds, to be used for general corporate purposes, including
repurchases of outstanding long-term debt securities, capital
expenditures, investments in subsidiaries, working capital, repay-
ment of borrowings under bank credit agreements and other business
opportunities or as otherwise disclosed in any Prospectus
Supplement.
<PAGE>
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of earnings to fixed
charges for Southern Union on an historical basis for the year
ended June 30, 1994, and each of the four years in the period ended
December 31, 1993, and for the six-month and twelve-month periods
ended December 31, 1994. Such ratios are also presented on a pro
forma basis for the year ended June 30, 1994 and the twelve-month
periods ended December 31, 1994. For the purpose of calculating
such ratios, "earnings" consist of income from continuing
operations before income taxes and "fixed charges" consist of
interest expense, amortization of debt discount or premium and an
estimate of interest implicit in rentals.
Twelve Six
Months Months
Ended Year Ended
Decem- Ended Decem- Year Ended
ber 31, June 30, ber 31, December 31,
______________________
1994 1994(a) 1994 1993 1992 1991 1990
______ _______ _______ ____ ____ ____ ____
Ratio of
Earnings to
Fixed Charges. . 1.21 1.49 1.03 1.76 1.77 1.82 1.10
==== ==== ==== ==== ==== ==== ====
Pro Forma -
Ratio of
Earnings to
Fixed
Charges(b) . . . 1.38 1.39
==== ====
________________________
(a) During 1994, the Company changed its fiscal year-end from
December 31 to June 30.
(b) This pro forma ratio gives effect to an increase in
outstanding debt, as of the beginning of the period presented,
primarily as a result of the January 31, 1994 acquisition of
Missouri Gas Energy, which was financed through the sale of
$475 million of 7.60% Senior Notes. Those debt proceeds,
along with proceeds of a $50 million common stock rights
offering and working capital from operations, were also used
to retire approximately $105 million of long-term debt. This
ratio also assumes the acquisition of Missouri Gas Energy
occurred as of the beginning of the period presented, as
reflected in the pro forma condensed statement of consolidated
operations included in the 1994 Form 10-K and the December 31,
1994 Second Quarter Form 10-Q.
DESCRIPTION OF SOUTHERN UNION DEBT SECURITIES
The following description sets forth certain general terms and
provisions of the Debt Securities to which any Prospectus
Supplement may relate. The particular terms of the Debt Securities
offered by any Prospectus Supplement and the extent, if any, to
which such general provisions may apply to the Debt Securities so
offered will be described in the Prospectus Supplement relating to
such Debt Securities.
The Debt Securities may be issued, from time to time, in one or
more series, and will constitute either Senior Debt Securities or
Subordinated Debt Securities. Senior Debt Securities may be issued
under an Indenture dated as of January 31, 1994 (the "Senior Debt
Securities Indenture"), between the Company and The Chase Manhattan
Bank, N. A., as trustee (the "Senior Debt Securities Trustee").
The Subordinated Debt Securities may be issued from time to time
under an Indenture dated as of , 1995 (the
_________________
"Subordinated Debt Securities Indenture") between the Company and
as trustee (the "Subordinated Debt
_________________________
Securities Trustee").
The Senior Debt Securities Indenture and the Subordinated Debt
Securities Indenture are referred to herein individually as an
"Indenture" and, collectively, as the "Indentures," and the Senior
Debt Securities Trustee and the Subordinated Debt Securities
Trustee are each referred to herein as the "Trustee." Copies of
the Indentures are filed as an exhibit to the Registration
Statement. Capitalized terms used in this section which are not
otherwise defined in this Prospectus shall have the meanings set
forth in the Indentures to which they relate.
The following summaries of certain provisions of the Debt
Securities and the Indentures do not purport to be complete and are
subject to, and are qualified in their entirety by express
reference to all the provisions of the Indentures, including the
definitions therein of certain terms.
<PAGE>
General
The Debt Securities will be direct, unsecured obligations of
Southern Union.
The Indentures do not limit the aggregate principal amount of Debt
Securities that may be issued thereunder and provide that Debt
Securities may be issued thereunder from time to time in one or
more series.
Unless otherwise indicated in the Prospectus Supplement relating
thereto, the principal of, and any premium or interest on, the Debt
Securities will be payable, and the Debt Securities will be
exchangeable and transfers thereof will be registrable, at the
Place of Payment; provided that, at the option of Southern Union,
payment of interest may be made by check mailed to the address of
the person entitled thereto as it appears in the Security Register.
The Indentures do not contain any provisions that may afford the
Holders of Debt Securities protection in the event of a highly
leveraged transaction or other transaction involving Southern Union
that may occur in connection with a takeover attempt resulting in
a decline in the credit rating of the Debt Securities. Any
provision that does provide such protection, if applicable to the
Debt Securities, will be described in any Prospectus Supplement
relating thereto.
The Debt Securities may be issued under the Indentures as Original
Issue Discount Securities to be offered and sold at a substantial
discount below their principal amount. Special United States
federal income tax, accounting and other considerations applicable
to any such Original Issue Discount Securities will be described in
any Prospectus Supplement relating thereto. "Original Issue
Discount Security" means any security that provides for an amount
less than the principal amount thereof to be due and payable upon
a declaration of acceleration of the maturity thereof as a result
of the occurrence of an Event of Default and the continuation
thereof. In addition, the Subordinated Debt Securities may, for
United States federal income tax purposes, be deemed to have been
issued with "original issue discount" ("OID") even if such
securities are offered and sold at an amount equal to their stated
principal amount. The United States federal income tax
consequences of Subordinated Debt Securities deemed to be issued
with OID will be described in any Prospectus Supplement relating
thereto.
The Indenture does not contain any provisions that would limit the
ability of Southern Union to incur indebtedness. Reference is made
to any Prospectus Supplement relating to the Debt Securities
offered thereby for information with respect to any deletions from,
modifications of or additions to the Events of Default or covenants
of Southern Union applicable to such Debt Securities that are
described herein.
Under the Indentures, Southern Union will have the ability to issue
Debt Securities with terms different from those of Debt Securities
previously issued, without the consent of the Holders of previously
issued series of Debt Securities, in an aggregate principal amount
determined by Southern Union.
Registration and Transfer
The Debt Securities may be issued as Registered Securities or
Bearer Securities. Registered Securities will be exchangeable for
other Registered Securities of the same series and of a like
aggregate principal amount and tenor of different authorized
denominations. If (but only if) provided for in any Prospectus
Supplement, Bearer Securities (with all unmatured coupons, except
as provided below, and all matured coupons in default) of any
series may be exchanged for Registered Securities of the same
series of any authorized denominations and of a like aggregate
principal amount and tenor. In such event, Bearer Securities
surrendered in a permitted exchange for Registered Securities
between a Regular Record Date or a Special Record Date and the
relevant date for payment of interest shall be surrendered without
the coupon relating to such date for payment of interest, and
interest will not be payable on such date for payment of interest
in respect of the Registered Security issued in exchange for such
Bearer Security, but will be payable only to the holder of such
coupon when due, in accordance with the terms of the Indenture.
Unless otherwise specified in any Prospectus Supplement, Bearer
Securities will not be issued in exchange for Registered
Securities.
The Debt Securities may be presented for exchange as described
above, and Registered Securities may be presented for registration
of transfer (duly endorsed or accompanied by a written instrument
<PAGE>
of transfer), at the corporate trust office of the Trustee in New
York, New York, or at the office of any transfer agent designated
by Southern Union for such purpose with respect to any series of
Debt Securities and referred to in any Prospectus Supplement. No
service charge will be made for any transfer or exchange of Debt
Securities, but Southern Union may require payment of a sum
sufficient to cover any tax or other governmental charge payable in
connection therewith. If any Prospectus Supplement refers to any
transfer agent (in addition to the Trustee) initially designated by
Southern Union with respect to any series of Debt Securities,
Southern Union may at any time rescind the designation of any such
transfer agent or approve a change in the location at which any
such transfer agent acts, except that, if Debt Securities of a
series are issuable solely as Registered Securities, Southern Union
will be required to maintain a transfer agent in each Place of
Payment for such series and, if Debt Securities of a series may be
issuable both as Registered Securities and as Bearer Securities,
Southern Union will be required to maintain (in addition to the
Trustee) a transfer agent in a Place of Payment for such series
located outside the United States. Southern Union may at any time
designate additional transfer agents with respect to any series of
Debt Securities.
Southern Union shall not be required to: (i) issue, register the
transfer of or exchange Debt Securities of any series during a
period beginning at the opening of business 15 days before any
selection of Debt Securities of that series to be redeemed and
ending at the close of business on (A) if Debt Securities of the
series are issuable only as Registered Securities, the day of
mailing of the relevant notice of redemption and (B) if Debt
Securities of the series are issuable as Bearer Securities, the day
of the first publication of the relevant notice of redemption or,
if Debt Securities of the series are also issuable as Registered
Securities and there is no publication, the day of mailing of the
relevant notice of redemption; (ii) register the transfer of or
exchange any Registered Security, or portion thereof, called for
redemption, except the unredeemed portion of any Registered
Security being redeemed in part; (iii) exchange any Bearer Security
selected for redemption, except to exchange such Bearer Security
for a Registered Security of that series and like tenor that is
simultaneously surrendered for redemption; or (iv) issue, register
the transfer of or exchange any Debt Securities that has been
surrendered for repayment at the option of the Holder, except the
portion if any, thereof not to be so repaid.
Global Securities
The Debt Securities of a series may be issued in whole or in part
in the form of one or more Global Securities (as such term is
defined below), which will be deposited with, or on behalf of, a
depositary ("Depositary") or its nominee identified in the
applicable Prospectus Supplement. In such case, one or more Global
Securities will be issued in a denomination or aggregate
denomination equal to the portion of the aggregate principal amount
of outstanding Debt Securities of the series to be represented by
such Global Security or Global Securities. Unless and until it is
exchanged in whole or in part for Debt Securities in registered
form, a Global Security may not be registered for transfer or
exchange except as a whole by the Depositary for such Global
Security to a nominee of such Depositary, by a nominee of such
Depositary to such Depositary or another nominee to such Depositary
or by such Depositary, or by any nominee to a successor Depositary
or a nominee of such successor Depositary and, in the circumstances
described in the applicable Prospectus Supplement. The term
"Global Security," when used with respect to any series of Debt
Securities, means a Debt Security that is executed by Southern
Union and authenticated and delivered by the Trustee to the
Depositary or pursuant to the Depositary's instruction, which shall
be registered in the name of the Depositary or its nominee and
which shall represent, and shall be denominated in an amount equal
to the aggregate principal amount of, all of the Outstanding Debt
Securities of such series or any portion thereof, in either case
having the same terms, including, without limitation, the same
original issue date, date or dates on which principal is due, and
interest rate or method of determining interest.
The specific terms of the depositary arrangement with respect to
any portion of a series of Debt Securities to be represented by a
Global Security will be described in the applicable Prospectus
Supplement. Southern Union expects that the following provisions
will apply to depositary arrangements.
Unless otherwise specified in the applicable Prospectus Supplement,
Debt Securities that are to be represented by a Global Security to
be deposited with or on behalf of a Depositary will be represented
by a Global Security registered in the name of such Depositary or
its nominee. Upon the issuance of such Global Security, and the
deposit of such Global Security with or on behalf of the Depositary
for such Global Security, the Depositary will credit on its book-
entry registration and transfer system the respective principal
amounts of the Debt Securities represented by such Global Security
<PAGE>
to the accounts of institutions that have accounts with such
Depositary or its nominee ("participants"). The accounts to be
credited will be designated by the underwriters or agents of such
Debt Securities or, if such Debt Securities are offered and sold
directly by Southern Union, by Southern Union. Ownership of
beneficial interests in such Global Security will be limited to
participants or Persons that may hold Interests through
participants. Ownership of beneficial interests by participants in
such Global Security will be shown on, and the transfer of that
ownership interest will be effected only through, records
maintained by the Depositary or its nominee for such Global
Security. Ownership of beneficial interests in such Global
Security by Persons that hold through participants will be shown
on, and the transfer of that ownership interest within such
participant will be effected only through, records maintained by
such participant. The laws of some jurisdictions require that
certain purchasers of securities take physical delivery of such
securities in certificated form. The foregoing limitations and
such laws may impair the ability to transfer beneficial interests
in such Global Securities.
So long as the Depositary for a Global Security, or its nominee, is
the registered owner of such Global Security, such Depositary or
such nominee, as the case may be, will be considered the sole owner
or Holder of the Debt Securities represented by such Global
Security for all purposes under the Indenture. Unless otherwise
specified in the applicable Prospectus Supplement, owners of
beneficial interests in such Global Security will not be entitled
to have Debt Securities of the series represented by such Global
Security registered in their names, will not receive or be entitled
to receive physical delivery of Debt Securities of such series in
certificated form and will not be considered the Holders thereof
for any purposes under the Indenture. Accordingly, each Person
owning a beneficial interest in such Global Security must rely on
the procedures of the Depositary and, if such Person is not a
participant, on the procedures of the participant through which
such Person owns its interest to exercise any rights of a Holder
under the Indenture. Southern Union understands that under
existing industry practices, if Southern Union requests any action
of Holders or an owner of a beneficial interest in such Global
Security desires to give any notice or take any action a Holder is
entitled to give or take under the Indenture, then the Depositary
would authorize the participants to give such notice or take such
action, and participants would authorize beneficial owners owning
through such participants to give such notice or take such action
or would otherwise act upon the instructions of beneficial owners
owning through them.
Principal of and any premium and interest on a Global Security will
be payable in the manner described in the applicable Prospectus
Supplement.
Restrictions
The Debt Securities Indentures provide that Southern Union shall
not consolidate with or merge with or into any other corporation,
or convey, transfer or lease, or permit one or more of its
Subsidiaries to convey, transfer or lease, all or substantially all
of the properties and assets of the Company on a consolidated basis
to any Person, unless either Southern Union is the continuing
corporation or such corporation or Person assumes by supplemental
indenture all the obligations of Southern Union under the
Indentures and the Debt Securities, no default or Event of Default
shall exist immediately after the transaction, and the surviving
corporation or such Person is a corporation, partnership or trust
organized and validly existing under the laws of the United States
of America, any state thereof or the District of Columbia.
Pursuant to the Indentures, Southern Union will not, nor will it
permit any Subsidiary to, create, incur, issue or assume any Debt
secured by any Lien on any property or assets owned by Southern
Union or any Subsidiary, and Southern Union will not, nor will it
permit any Subsidiary to, create, incur, issue or assume any Debt
secured by any Lien on any shares of stock or Debt of any
Subsidiary (such shares of stock or Debt of any Subsidiary being
called "Restricted Securities"), unless (i) in the case of Debt
which is expressly by its terms subordinate or junior in right of
payment to the applicable series of Debt Securities, such Debt
Securities are secured by a Lien on such property or assets that is
senior to such other Lien with the same relative priority as such
subordinated Debt has with respect to the applicable series of Debt
Securities or (ii) in the case of Liens securing Debt which is
ranked pari passu with the applicable series of Debt Securities,
such Debt Securities are secured by a Lien on such property or
assets that is equal and ratable with such other Lien, except that
any Lien securing such Debt Securities may be junior to any Lien
<PAGE>
on Southern Union's accounts receivable, inventory and related
contract rights securing Debt under Southern Union's revolving
credit facility, entered into on September 30, 1993 with Texas
Commerce Bank, N. A., as amended on November 15, 1993 and July 1,
1994; provided, however, that, nothing contained in Section
____
of the Indenture shall prevent, restrict or apply to, and there
shall be excluded from secured Debt in any computation under that
Section, Debt secured by:
(a) Liens on any property or assets or Restricted Securities of
Southern Union or any Subsidiary existing as of the date of
the first issuance by Southern Union of the applicable Debt
Securities issued pursuant to an Indenture or such other date
as may be specified in a Prospectus Supplement for an
applicable series of Debt Securities issued pursuant to an
Indenture, subject to the provisions of subsection (h) below;
(b) Liens on any property or assets or Restricted Securities of
any corporation existing at the time such corporation becomes
a Subsidiary, or arising thereafter (i) otherwise than in
connection with the borrowing of money arranged thereafter and
(ii) pursuant to contractual commitments entered into prior to
and not in contemplation of such corporation's becoming a
Subsidiary;
(c) Liens on any property or assets or Restricted Securities of
Southern Union or any Subsidiary existing at the time of
acquisition thereof, or securing the payment of all or any
part of the purchase price or construction cost thereof. or
securing any Debt incurred prior to, at the time of or within
120 days after, the acquisition of such property or assets or
Restricted Securities or the completion of any such
construction, whichever, is later, for the purpose of
financing all or any part of the purchase price or
construction cost thereof;
(d) Liens on any property or assets to secure all or any part
of the cost of development, operation, construction,
alteration, repair or improvement of all or any part of such
property or assets or to secure Debt incurred by Southern
Union or any Subsidiary prior to, at the time of or within 120
days after, the completion of such development, operation,
construction, alteration, repair or improvement, whichever is
later, for the purpose of financing all or any part of such
cost;
(e) Liens in favor of the Trustee for the benefit of the Holders
and subsequent holders of the Debt Securities securing the
Debt Securities;
(f) Liens secured by property or assets of Southern Union or
any Subsidiary that comprise no more than 20% of Consolidated
Net Tangible Assets (as defined below);
(g) Liens which secure Senior Indebtedness owing by a
Subsidiary to Southern Union or to another Subsidiary; and
(h) Any extension, renewal, substitution or replacement (or
successive extensions, renewals, substitutions or
replacements), in whole or in part, of any of the Liens
referred to in paragraphs (a) through (g) above or the Debt
secured thereby; provided, that (1) such extension, renewal,
substitution or replacement Lien shall be limited to all or
any part of the same property or assets or Restricted
Securities that secured the Lien extended, renewed,
substituted or replaced (plus improvements on such property
and plus any other property or assets not then owned by
Southern Union or a Subsidiary or constituting Restricted
Securities) and (2) in the case of paragraphs (a) through (c)
above, the Debt secured by such Lien at such time is not
increased.
For the purposes of Section , the giving of a guarantee
________
that is secured by a Lien on any property or assets or Restricted
Securities, and the creation of a Lien on any property or assets or
Restricted Securities to secure Debt that existed prior to the
creation of such Lien, shall be deemed to involve the creation of
Debt in an amount equal to the principal amount guaranteed or
secured by such Lien; but the amount of Debt secured by Liens on
property or assets and Restricted Securities shall be computed
without cumulating the underlying indebtedness with any guarantee
thereof or Lien securing the same.
<PAGE>
Limitation on Sale and Leaseback Transactions
Southern Union will not, and will not permit any Subsidiary to,
enter into any arrangement after the date of the original issuance
by Southern Union of the applicable series of Debt Securities
issued pursuant to an Indenture, or such other date as may be
specified in any Prospectus Supplement for an applicable series of
Debt Securities issued pursuant to an Indenture, with any Person
(other than Southern Union or another Subsidiary) providing for the
leasing by Southern Union or any such Subsidiary of any property
(except a lease for a temporary period not to exceed three years by
the end of which it is intended that the use of such property by
the lessee will be discontinued) that was or is owned or leased by
Southern Union or a Subsidiary and that has been or is to be sold
or transferred by Southern Union or such Subsidiary to such Person
(herein referred to as a "sale and leaseback transaction") unless
either --
(a) after giving pro forma effect to such transaction, the
Attributable Debt (as defined below) of Southern Union and its
Subsidiaries in respect of such sale and leaseback transaction
and all other sale and leaseback transactions entered into
after the date of the first issuance by Southern Union of Debt
Securities issued pursuant to the Indenture (other than such
sale and leaseback transactions as are permitted by paragraph
(b) below) would not exceed 20% of Consolidated Net Tangible
Assets, or
(b) Southern Union, within 180 days after the sale and
leaseback transaction, applies or causes a Subsidiary to
apply an amount equal to the greater of the net proceeds from
the sale of the property subject to the sale and leaseback
transaction or the fair market value of the property so sold
and leased back at the time of the sale and leaseback
transaction to the retirement of Debt Securities of any series
or any other Debt of Southern Union (other than Debt
subordinated to the Debt Securities) or Debt of a
Subsidiary having a stated maturity more than 12 months from
the date of such application or which is extendible at the
option of the obligor thereon to a date more than 12 months
from the date of such application (and, unless otherwise
expressly provided with respect to any one or more series of
Debt Securities, any redemption of Debt Securities pursuant to
this provision shall not be deemed to constitute a refunding
operation or anticipated refunding operation for the purposes
of any provision limiting Southern Union's right to redeem
Debt Securities of any one or more such series when such
redemption involves a refunding operation or anticipated
refunding operation); provided that, the amount to be
so applied shall be reduced by (i) the principal amount of
Debt Securities delivered within 180 days after such sale or
transfer to the Trustee for retirement and cancellation and
(ii) the principal amount of any such Debt of Southern Union
or a Subsidiary, other than Debt Securities, is voluntarily
retired by Southern Union or a Subsidiary within 180 days
after such sale or transfer. Notwithstanding the foregoing,
no retirement referred to in this paragraph (b) may be
effected by payment at maturity or pursuant to any mandatory
sinking fund payment or any mandatory prepayment provision.
Notwithstanding the foregoing, where Southern Union or any
Subsidiary is the lessee in any sale and leaseback transaction,
Attributable Debt shall not include any Debt resulting from the
guarantee by Southern Union or any other Subsidiary of the lessee's
obligation thereunder.
Events of Default
The Indentures provide, with respect to any series of Debt
Securities outstanding thereunder, that the following shall
constitute Events of Default: (i) default in the payment of any
interest upon or any Additional Amounts payable in respect of any
Debt Security of that series, or of any coupon appertaining
thereto, when the same becomes due and payable and continues for 30
days; provided, however, that, a valid extension of the interest
payment period by Southern Union for the Subordinated Debt
Securities shall not constitute a default in the payment of
interest for this purpose; (ii) default in the payment of the
principal of or any premium on any Debt Security of that series
when due, whether at maturity, upon redemption by declaration or
otherwise; provided, however, that, a valid extension of the
maturity of the Subordinated Debt Securities shall not constitute
a default for this purpose; (iii) default in the deposit of any
sinking fund payment, when and as due by the terms of any Debt
Securities of that series; (iv) default in the performance or
breach of any covenant or agreement of Southern Union in the
Indenture with respect to any Debt Security of that series,
continued for 60 days after written notice to Southern Union; (v)
<PAGE>
cross-acceleration of other Debt of Southern Union in excess of 10%
of Consolidated Net Worth; (vi) certain events in bankruptcy,
insolvency or reorganization of Southern Union; (vii) the voluntary
or involuntary dissolution, winding-up or termination of such
Southern Union Trust to which Subordinated Debt Securities were
issued in connection with the issuance of Trust Securities by such
Southern Union Trust, except in connection with the distribution of
Subordinated Debt Securities to the holders of Trust Securities in
liquidation of such Southern Union Trust and in connection with
certain mergers, consolidations or amalgamations permitted by the
Declaration of such Southern Union Trust; and (viii) any other
Event of Default provided with respect to Debt Securities of that
series. Southern Union is required to file annually with the
Trustee an officer's certificate as to Southern Union's compliance
with all conditions and covenants under the Indenture. The
Indenture provides that the Trustee may withhold notice to the
Holders of Debt Securities of any default if it considers it in the
interest of the Holders of Debt Securities to do so.
If an Event of Default, other than certain events with respect to
bankruptcy, insolvency and reorganization of Southern Union or any
significant Subsidiary, occurs and is continuing with respect to
Debt Securities of a particular series, the Trustee or the Holders
of not less than 25% in principal amount of Outstanding Debt
Securities of that series may declare the Outstanding Debt
Securities of that series due and payable immediately. If an Event
of Default with respect to certain events of bankruptcy, insolvency
or reorganization of Southern Union or any Significant Subsidiary
with respect to Debt Securities of a particular series shall occur
and be continuing, then the principal of all the Outstanding Debt
Securities of that series, and accrued and unpaid interest thereon,
shall automatically be due and payable without any act on the part
of the Trustee or any Holders.
Subject to the provisions relating to the duties of the Trustee, if
an Event of Default with respect to Debt Securities of a particular
series occurs and is continuing, the Trustee shall be under no
obligation to exercise any of its rights or powers under the
Indenture at the request, order or direction of any of the Holders
of Debt Securities of such series, unless such Holders shall have
offered to the Trustee reasonable indemnity and security against
the costs, expenses and liabilities that might be incurred by it in
compliance with such request. Subject to such provisions for the
indemnification of the Trustee, the Holders of a majority in
principal amount of the Outstanding Debt Securities of such series
shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee
under the Indenture, or exercising any trust or power conferred on
the Trustee with respect to the Debt Securities of that series.
The Trustee may refuse to follow directions in conflict with law or
the Indenture which may involve Trustee in personal liability or
may be unduly prejudicial to Holders not joining therein.
The Holders of not less than a majority in principal amount of the
Outstanding Debt Securities of any series may, on behalf of the
Holders of all the Debt Securities of such series and any related
coupons, waive any past default under the applicable Indenture with
respect to such series and its consequences, except a default (i)
in the payment of the principal of (or premium, if any) or interest
on or Additional Amounts payable in respect of any Debt Security of
such series or (ii) in respect of a covenant or provision that
cannot be modified or amended without the consent of the Holder of
each Outstanding Debt Security of such series affected thereby.
Modification or Waiver
Modification and amendment of each of the Indentures may be made by
Southern Union and the applicable Trustee with the consent of the
Holders of not less than a majority in principal amount of all
Outstanding Indenture Securities or any series that are affected by
such modification or amendment; provided that, no such modification
or amendment may, without the consent of the Holder of each
Outstanding Debt Security of such series, among other things, (i)
change the Stated Maturity of the principal of (or premium, if any,
on) or any installment of principal of or interest on any Debt
Security of such series, (ii) reduce the principal amount or the
rate of interest on or any Additional Amounts payable in respect
of, or any premium payable upon the redemption of, any Debt
Security of such series, (iii) change any obligation of Southern
Union to pay Additional Amounts in respect of any Debt Security of
such series, (iv) reduce the amount of principal of an original
issue discount Debt Security of such series that would be due and
payable upon a declaration of acceleration of the Maturity thereof,
(v) adversely affect any right of repayment at the option of the
Holder of any Debt Security of such series, (vi) change the place
<PAGE>
or currency of payment of principal of, or any premium or interest
on, any Debt Security of such series, (vii) impair the right to
institute suit for the enforcement of any such payment on or after
the Stated Maturity thereof or any Redemption Date or Repayment
Date therefor, (viii) reduce the above-stated percentage of Holders
of Outstanding Debt Securities of such series necessary to modify
or amend the Indenture or to consent to any waiver thereunder or
reduce the requirements for voting or quorum described below, (ix)
modify the change of control provisions, if any, or (x) modify the
foregoing requirements or reduce the percentage of Outstanding Debt
Securities of such series necessary to waive any past default.
Modification and amendment of the Indenture may be made by Southern
Union and the applicable Trustee without the consent of any Holder,
for any of the following purposes: (i) to evidence the succession
of another Person to Southern Union as obligor under an Indenture;
(ii) to add to the covenants of Southern Union for the benefit of
the Holders of all or any series of Debt Securities; (iii) to add
Events of Default for the benefit of the Holders of all or any
series of Debt Securities; (iv) to add or change any provisions of
the applicable Indenture to facilitate the issuance of Bearer
Securities; (v) to change or eliminate any provisions of the
applicable Indenture, provided that any such change or elimination
shall become effective only when there are no Outstanding Debt
Securities of any series created prior thereto that is entitled to
the benefit of such provision; (vi) to establish the form or terms
of Debt Securities of any series and any related coupons; (vii) to
secure the Debt Securities; (viii) to provide for the acceptance of
appointment by a successor Trustee or facilitate the administration
of the trusts under the applicable Indenture by more than one
Trustee; (ix) to close the applicable Indenture with respect to the
authentication and delivery of additional series of Debt
Securities, in order to cure any ambiguity, defect or inconsistency
in the applicable Indenture, provided such action does not
adversely affect the interest of Holders of Debt Securities of any
series in any material respect.
The applicable Indenture contains provisions for convening meetings
of the Holders of Debt Securities of a series if Debt Securities of
that series are issuable as Bearer Securities. A meeting may be
called at any time by the applicable Trustee and also, upon
request, by Southern Union or the Holders of at least 10% in
principal amount of the Debt Securities of such series Outstanding,
but in any case, notice shall be given as provided in the
applicable Indenture. Except for any consent that must be given by
the Holder of each Debt Security affected thereby, as described
above, any resolution presented at a meeting or adjourned meeting
duly reconvened at which a quorum is present may be adopted by the
affirmative vote of the Holders of a majority in principal amount
of the Debt Securities of that series Outstanding; provided,
however, that, any resolution with respect to any request, demand,
authorization, direction, notice, consent, waiver or other action
that may be made, given or taken by the Holders of a specified
percentage, that is less than a majority in principal amount of
Debt Securities of a series Outstanding may be adopted at a meeting
or adjourned meeting, duly reconvened and at which a quorum is
present, by the affirmative vote of the Holders of such specified
percentage in principal amount of the Debt Securities of that
series Outstanding. Any resolution passed or decision taken at any
meeting of Holders of Debt Securities of any series duly held in
accordance with the Indenture will be binding on all Holders of
Debt Securities of that series and the related coupons. The quorum
at any meeting called to adopt a resolution, and at any reconvened
meeting, will consist of persons entitled to vote a majority in
principal amount of the Debt Securities of a series Outstanding;
provided, however, that, if any action is to be taken at such
meeting with respect to a consent or waiver that may be given by
the Holders of not less than a specified percentage in principal
amount of the Debt Securities of a series Outstanding, the Persons
entitled to vote such specified percentage in principal amount of
the Debt Securities of such series Outstanding will constitute a
quorum. Notwithstanding the foregoing provisions, if any action is
to be taken at a meeting of Holders of Debt Securities of any
series with respect to any request, demand, authorization, direc-
tion, notice, consent, waiver or other action that the applicable
Indenture expressly provides may be made, given or taken by the
Holders of a specified percentage in principal amount of all
Outstanding Debt Securities affected thereby, or of the Holders of
such series and one or more additional series, then (i) there shall
be no minimum quorum requirement for such meeting; and (ii) the
principal amount of the Outstanding Debt Securities of such series
that vote in favor of such request, demand, authorization,
direction, notice, consent, waiver or other action shall be taken
into account in determining whether such request, demand,
authorization, direction, notice, consent, waiver or other action
has been made, given or taken under the applicable Indenture.
<PAGE>
Financial Information
So long as any of the Debt Securities are outstanding, Southern
Union will file with the Commission, to the extent permitted under
the Exchange Act, the annual reports, quarterly reports and other
documents otherwise required to be filed with the Commission
pursuant to Section 13(a) or 15(d) of the Exchange Act as if
Southern Union were subject to such Sections, and Southern Union
will also provide to all Holders and file with the Trustees copies
of such reports and documents within 15 days after it files them
with the Commission or, if filing such reports and documents by
Southern Union with the Commission is not permitted under the
Exchange Act, within 15 days after it would otherwise have been
required to file such reports and documents if permitted, in each
case at Southern Union's cost.
Certain Definitions
"Attributable Debt" means, as to any specified lease under which
any Person is at the time liable for a term of more than 12 months,
at any date as of which the amount thereof is to be determined, the
total net amount of rent required to be paid by such Person under
such lease during the remaining term thereof (excluding any
subsequent renewal or other extension options held by the lessee),
discounted from the respective due dates thereof to such date at a
rate equal to the weighted average of the interest rates borne by
the Outstanding Debt Securities, compounded monthly. The net
amount of rent required to be paid under any such lease for any
such period shall be the aggregate amount of the rent payable by
the lessee with respect to such period after excluding any amounts
required to be paid on account of maintenance and repairs,
services, insurance, taxes, assessments, water rates and similar
charges and contingent rents (such as those based on sales). In
the case of any lease that is terminable by the lessee upon the
payment of a penalty, such net amount of rent shall include the
lesser of (i) the total discounted net amount of rent required to
be paid from the later of the first date upon which such lease may
be so terminated or the date of the determination of such net
amount of rent, as the case may be, and (ii) the amount of such
penalty (in which event no rent shall be considered as required to
be paid under such lease subsequent to the first date upon which it
may be so terminated).
"Consolidated Net Tangible Assets" means the total amount of assets
(less applicable reserves and other property deductible items) of
Southern Union and its consolidated Subsidiaries after deducting
therefrom (i) all current liabilities (excluding any current
liabilities which are by their terms extendible or renewable at the
option of the obligor thereon to a time more than 12 months after
the time as of which the amount thereof is being computed) and (ii)
all goodwill, trade names, trademarks, patents, unamortized debt
discount and expense and other like intangibles, all as set forth
on the most recent balance sheet of Southern Union and its
consolidated subsidiaries and computed in accordance with generally
accepted accounting principles.
PARTICULAR TERMS OF THE SENIOR DEBT SECURITIES
The following description of the Senior Debt Securities sets forth
certain general terms and provisions of the Senior Debt Securities
to which any Prospectus Supplement may relate. The particular
terms of the Senior Debt Securities offered by any Prospectus
Supplement, and the extent, if any, to which such general
provisions may apply to the Senior Debt Securities so offered, will
be described in the Prospectus Supplement relating to such Senior
Debt Securities.
General
The Senior Debt Securities Indenture provides for the issuance of
Senior Debt Securities from time to time, in one or more series.
Reference is made to the Prospectus Supplement relating to a
particular issuance of a series of Senior Debt Securities being
offered (the "Senior Debt Securities") for, among other things, the
following terms thereof: (1) the title of the Senior Debt
Securities; (2) any limit on the aggregate principal amount of such
Senior Debt Securities; (3) the percentage of the principal amount
at which such Senior Debt Securities will be issued and, if other
than the principal amount thereof, the portion of the principal
amount payable upon declaration of acceleration of the maturity
thereof, or the method by which such portion shall be determined;
(4) the date or dates on which the principal of such Senior Debt
Securities will be payable; (5) the rate or rates at which such
<PAGE>
Senior Debt Securities will bear interest, or the method by which
such rate or rates shall be determined, and the date such interest
shall accrue, or the method by which such date or dates shall be
determined; (6) the dates on which such interest will be payable
and the Regular Record Dates for any Interest Payment Dates and the
basis on which interest shall be calculated; (7) the dates, if any,
on which, and the price or prices at which, the Senior Debt
Securities may, pursuant to any mandatory or optional sinking fund
provisions, be redeemed by Southern Union and other detailed terms
and provisions of such sinking funds; (8) the date, if any, after
which, and the price or prices at which, the Senior Debt Securities
may, pursuant to any optional redemption provisions, be redeemed at
the option of Southern Union or of the Holder thereof and other
detailed terms and provisions of such optional redemption; (9) the
applicability, if at all, to such Senior Debt Securities of the
provisions of Article Fourteen of the Senior Debt Securities
Indenture described under "Defeasance and Covenant Defeasance" and
any provisions in modification of, in addition to or in lieu of any
of the provisions of such Article; (10) whether and under what
circumstances Southern Union will pay Additional Amounts, as
contemplated by Section [1005] of the Senior Debt Securities
Indenture, on such Senior Debt Securities to any Holder who is not
a United States person (including any modification to the
definition of such term as contained in the Senior Debt Securities
Indenture as originally executed) in respect to any tax, assessment
or governmental charge and, if so, whether Southern Union will have
the option to redeem such Senior Debt Securities rather than pay
such Additional Amounts (and the terms of any such option); (11)
any deletions from, modifications of or additions to the Events of
Default or covenants of Southern Union with respect to such Senior
Debt Securities, whether or not such Events of Default or covenants
are consistent with the Events of Default or covenants set forth
herein; and (12) any other terms of such Senior Debt Securities.
For a description of the terms of any series of Senior Debt
Securities, reference must be made to both the Prospectus
Supplement relating thereto and the description of Debt Securities
set forth herein.
Unless otherwise indicated in the Prospectus Supplement relating
thereto, the Senior Debt Securities will be issued in United States
dollars in fully registered form, without coupons, in denominations
of $1,000, or any integral multiple thereof. No service charge
will be made for any transfer or exchange of the Senior Debt
Securities, but Southern Union may require payment of a sum
sufficient to cover any tax or other governmental charge payable in
connection therewith.
Denominations
Senior Debt Securities may be issuable as Registered Securities
solely, as Bearer Securities solely, or as both. Registered
Securities will be issuable in denominations of $1,000 and integral
multiples of $1,000, and Bearer Securities will be issuable in the
denomination of $5,000 or, in each case, in such other
denominations as may be in the terms of the Senior Debt Securities.
The Senior Debt Securities Indenture also provides that Senior Debt
Securities may be issuable in global form. Unless otherwise
indicated in any Prospectus Supplement, Bearer Securities will have
interest coupons attached.
Defeasance and Covenant Defeasance
The Senior Debt Securities Indenture provides that, if the
provisions of Article Fourteen are made applicable to the Senior
Debt Securities of or within any series and any related coupons
pursuant to Section 1401 of the Senior Debt Securities Indenture,
Southern Union may elect either (a) to defease and be discharged
from any and all obligations with respect to such Senior Debt
Securities and any related coupons (except for the obligation to
pay Additional Amounts, if any, upon the occurrence of certain
events of tax, assessment or governmental charge with respect to
payments on such Senior Debt Securities and the obligations to
register the transfer or exchange of such Senior Debt Securities
and any related coupons, to replace temporary or mutilated,
destroyed, lost or stolen Senior Debt Securities and any related
coupons, to maintain an office or agency in respect of such Senior
Debt Securities and any related coupons and to hold moneys for
payment in trust) ("defeasance") or (b) to be released from its
obligations with respect to such Senior Debt Securities and any
related coupons under Section [1402] (being the restriction
described under "Limitation on Liens") or, if provided pursuant to
Section [1403] of the Senior Debt Securities Indenture, its
obligations with respect to any other covenant, and any omission to
comply with such obligations shall not constitute a default or an
Event of Default with respect to such Senior Debt Securities and
any related coupons ("covenant defeasance"), in either case upon
the irrevocable deposit by Southern Union with the Senior Debt
Securities Trustee (or other qualifying trustee), in trust, of an
<PAGE>
amount, in such Currency in which such Senior Debt Securities and
any related coupons are then specified as payable at Stated
Maturity, or Government Obligations (as defined below), or both,
applicable to such Senior Debt Securities and any related coupons
(with such applicability being determined on the basis of the
currency, currency unit or composite currency in which such Senior
Debt Securities are then specified as payable at Stated Maturity)
which through the scheduled payment of principal and interest in
accordance with their terms will provide money in an amount
sufficient to pay the principal of (and premium, if any) and
interest, if any, on such Senior Debt Securities and any related
coupons, and any mandatory sinking fund or analogous payments
thereon, on the scheduled due dates therefor.
Such a trust may only be established if, among other things,
Southern Union has delivered to the Senior Debt Securities Trustee
an Opinion of Counsel (as specified in the Senior Debt Securities
Indenture) to the effect that the Holders of such Senior Debt
Securities and any related coupons will not recognize income gain
or loss for United States federal income tax purposes as a result
of such defeasance or covenant defeasance and will be subject to
United States federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such
defeasance or covenant defeasance had not occurred; provided that,
such Opinion of Counsel, in the case of defeasance under clause (a)
above, must refer to and be based upon a revenue ruling of the
Internal Revenue Service or a change in applicable United States
federal income tax law occurring after the date of the Senior Debt
Securities Indenture.
"Government Obligations" means securities that are (i) direct
obligations of the government that issued the Currency in which the
Senior Debt Securities of a particular series are payable, for the
payment of which its full faith and credit is pledged, or (ii)
obligations of a Person controlled or supervised by and acting as
an agency or instrumentality of the government that issued the
Currency in which the Senior Debt Securities of such series are
payable, the payment of which is unconditionally guaranteed as a
full faith and credit obligation by the United States of America or
such other government, which, in either case, are not callable or
redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank or trust company as
custodian with respect to any such Government Obligation or a
specific payment of interest on or principal of any such Government
Obligation held by such custodian for the account of the holder of
a depository receipt; provided that (except as required by law),
such custodian is not authorized to make any deduction from the
amount payable to the holder of such depository receipt from any
amount received by the custodian in respect of the Government
Obligation or the specific payment of interest in or principal of
the Government Obligation evidenced by such depository receipt.
Unless otherwise provided in the Prospectus Supplement, if, after
Southern Union has deposited funds and/or Government Obligations to
effect defeasance or covenant defeasance relating thereto with
respect to Senior Debt Securities of any series, (a) the Holder of
a Debt Security of such series is entitled to and does elect,
pursuant to the terms of such Debt Security, to receive payment in
a currency other than that in which such deposit has been made in
respect of such Debt Security or (b) the currency in which such
deposit has been made in respect of any Debt Security of such
series ceases to be used by its government of issuance, then the
indebtedness represented by such Debt Security shall be deemed to
have been, and will be, fully discharged and satisfied through the
payment of the principal of (and premium, if any) and interest, if
any, on such Debt Security as they become due out of the proceeds
yielded by converting the amount so deposited in respect of such
Debt Security into the Currency in which such Debt Security becomes
payable as a result of such election or such cessation of usage
based on the applicable Market Exchange Rate. Unless otherwise
provided in the Prospectus Supplement, all payments of principal of
(and premium, if any) and interest, if any, and Additional Amounts,
if any, on any Debt Security that is payable in a Foreign Currency
that ceases to be used by its government of issuance shall be made
in U. S. Dollars.
In the event Southern Union effects covenant defeasance with
respect to (i) any Senior Debt Securities and any related coupons
and (ii) such Senior Debt Securities and any related coupons are
declared due and payable because of the occurrence of any Event of
Default, other than the Event of Default described in clause (iii)
or (vi) under "Events of Default," with respect to any covenant for
which there has been defeasance, the Currency and/or Government
Obligations on deposit with the Trustee will be sufficient to pay
amounts due on such Senior Debt Securities and any related coupons
at the time of their Stated Maturity but may not be sufficient to
pay amounts due on such Senior Debt Securities and any related
coupons at the time of the acceleration resulting from such Event
<PAGE>
of Default. However, Southern Union would remain liable to make
payment of such amounts due at the time of acceleration.
The Prospectus Supplement may further describe the provisions, if
any, permitting such defeasance or covenant defeasance, including
any modifications to the provisions described above, with respect
to the Senior Debt Securities of or within a particular series and
any related coupons.
Ranking of Senior Debt Securities
The Senior Debt Securities will rank pari passu with all other
unsecured indebtedness of the Company, except that the Senior Debt
Securities will be senior in right of payment to any subordinated
indebtedness which, by its terms, is subordinate to the Senior Debt
Securities.
PARTICULAR TERMS OF THE SUBORDINATED DEBT SECURITIES
The following description of the Subordinated Debt Securities sets
forth the general terms and provisions of the Subordinated Debt
Securities to which any Prospectus Supplement may relate. The
particular terms of the Subordinated Debt Securities offered by any
Prospectus Supplement and the extent, if any, to which such general
provisions may apply will be described in the Prospectus Supplement
relating to such Subordinated Debt Securities.
For purposes of the description of the Subordinated Debt
Securities, certain defined terms have the following meanings:
The term "Senior Indebtedness" means, with respect to Southern
Union (i) the principal, premium, if any, and interest in respect
of (A) indebtedness [of such obligor] for money borrowed and (B)
indebtedness evidenced by securities, debentures, bonds or other
similar instruments issued [by such obligor] including, without
limitation all obligations under its 7.60% Senior Notes due 2024,
(ii) all capital lease obligations of such obligor, (iii) all
obligations of such obligor issued or assumed as the deferred
purchase price of property, all conditional sale obligations of
such obligor and all obligations of such obligor under any title
retention agreement (but excluding trade accounts payable arising
in the ordinary course of business), (iv) all obligations of such
obligor for the reimbursement on any letter of credit, banker's
acceptance, security purchase facility or similar credit trans-
action, (v) all obligations of the type referred to in clauses (i)
through (iv) of other persons for the payment of which such obligor
is responsible or liable as obligor, guarantor or otherwise, and
(vi) all obligations of the type referred to in clauses (i) through
(v) of other persons secured by any lien on any property or asset
of such obligor (whether or not such obligation is assumed by such
obligor), except for (1) any such indebtedness, guarantee or other
obligation that is by its terms subordinated to or ranked pari
passu with the Subordinated Debt Securities and (2) any
indebtedness, guarantee or other obligation between or among such
obligor and its affiliates. Such Senior Indebtedness shall
continue to be Senior Indebtedness and entitled to the benefits of
the subordination provisions of the Subordinated Debt Securities
Indenture irrespective of any amendment, modification or waiver of
any term of such Senior Indebtedness.
General
In the event Subordinated Debt Securities are issued to any
Southern Union Trust in connection with the issuance of Trust
Securities by any such Southern Union Trust, such Subordinated Debt
Securities subsequently may be distributed pro rata to the holders
of such Trust Securities in connection with the dissolution of such
Southern Union Trust upon the occurrence of certain events
described in the Prospectus Supplement relating to such Trust
Securities. Only one series of Subordinated Debt Securities will
be issued to each Southern Union Trust in connection with the
issuance of Trust Securities by such Southern Union Trust.
The Subordinated Debt Securities are issuable in one or more series
pursuant to an indenture supplement to the Subordinated Debt
Securities Indenture or a resolution of Southern Union's Board of
Directors or a special committee thereof (each a "Supplemental
Indenture").
<PAGE>
Reference is made to the Prospectus Supplement relating to any
Subordinated Debt Securities being offered for, among other things,
the following terms thereof: (1) the title of the Subordinated
Debt Securities; (2) any limit on the aggregate principal amount of
such Subordinated Debt Securities; (3) the percentage of the
principal amount at which such Subordinated Debt Securities will be
issued and, if other than the principal amount thereof, the portion
of the principal amount thereof payable upon acceleration of the
maturity thereof, or the method by which such portion shall be
determined; (4) the date or dates, on which the principal of such
Subordinated Debt Securities will be payable; (5) the rate or rates
at which such Subordinated Debt Securities will bear interest, or
the method by which such rate or rates shall be determined, and the
date such interest shall accrue, or the method by which such date
or dates shall be determined; (6) the dates on which such interest
will be payable and the Regular Record Dates for any Interest
Payment Dates and the basis on which interest shall be calculated;
(7) the dates, if any, on which, the price or prices at which the
Subordinated Debt Securities may, pursuant to any mandatory or
optional sinking fund provisions, be redeemed by Southern Union and
other detailed terms and provisions of such sinking funds; (8) the
date, if any, after which, and the price or prices at which, the
Subordinated Debt Securities may, pursuant to any optional
redemption provisions, be redeemed at the option of Southern Union
or of the Holder thereof, and other detailed terms and provisions
of such optional redemption; (9) whether and under what circum-
stances Southern Union will pay Additional Amounts as contemplated
by Section of the Indenture on such Subordinated Debt
________
Securities to any Holder who is not a United States person
(including any modification to the definition of such term as
contained in the Subordinated Debt Securities Indenture as
originally executed) in respect to any tax, assessment or
governmental charge and, if so, whether Southern Union will have
the option to redeem such Subordinated Debt Securities rather than
pay such Additional Amounts (and the terms of any such option);
(10) any deletions from, modifications of or additions to the
Events of Default or covenants of Southern Union with respect to
such Subordinated Debt Securities, whether or not such Events of
Default or covenants are consistent with the Events of Default or
covenants set forth herein; and (11) any other terms of such
Subordinated Debt Securities. For a description of the terms of
any series of the Subordinated Debt Securities, reference must be
made to both the Prospectus Supplement relating thereto and to the
description of Subordinated Debt Securities set forth herein.
Unless otherwise indicated in the Prospectus Supplement relating
thereto, the Subordinated Debt Securities will be issued in United
States dollars in fully registered form, without coupons, in
denominations of $25 or any integral multiple thereof. No service
charge will be made for any transfer or exchange of the
Subordinated Debt Securities, but Southern Union may require
payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.
Certain Covenants
If Southern Union elects to extend the interest payment period with
respect to one series of Subordinated Debt Securities issued to a
Southern Union Trust, it must also elect to extend the interest
payment period for all series of Subordinated Debt Securities
issued to other Southern Union Trusts, until deferred interest on
all Subordinated Debt Securities issued to Southern Union Trusts is
paid in full.
Denomination
Subordinated Debt Securities may be issuable as Registered
Securities solely, as Bearer Securities solely, or as both.
Registered Securities will be issuable in denominations of $25 and
integral multiples of $25 and Bearer Securities will be issuable in
the denomination of $5,000 or, in each case, in such other
denominations as may be in the terms of the Subordinated Debt
Securities. The Subordinated Debt Securities Indenture also
provides that Subordinated Debt Securities may be issued in global
form. Unless otherwise indicated in any Prospectus Supplement,
Bearer Securities will have interest coupons attached.
Subordination
The Subordinated Debt Securities will be subordinated and junior in
right of payment to certain other indebtedness of Southern Union to
the extent set forth in the Prospectus Supplement that will
accompany this Prospectus.
<PAGE>
DESCRIPTION OF THE SOUTHERN UNION TRUSTS' PREFERRED SECURITIES
Each Southern Union Trust may issue, from time to time, only one
series of Preferred Securities having terms described in the
Prospectus Supplement relating thereto. The Declaration of each
Southern Union Trust authorizes the Regular Trustees of such
Southern Union Trust to issue one series of Preferred Securities,
having such terms, including distributions, redemption, voting,
liquidation rights and such other preferred, deferred or other
special rights or such restrictions as shall be set forth therein.
Reference is made to any Prospectus Supplement relating to the
Preferred Securities of each Southern Union Trust for specific
terms, including (i) the distinctive designation of such Preferred
Securities, (ii) the number of Preferred Securities issued by such
Southern Union Trust, (iii) the annual distribution rate (or method
of determining such rate) for Preferred Securities issued by such
Southern Union Trust and the date or dates upon which such
distributions shall be payable (provided, however, that,
distributions on such Preferred Securities shall be payable on a
monthly basis to holders of such Preferred Securities as of a
record date in each month during which such Preferred Securities
are outstanding) (iv) whether distributions on Preferred Securities
issued by such Southern Union Trust shall be cumulative, and, in
the case of Preferred Securities having cumulative distribution
rights, the date or dates or method of determining the date or
dates from which distributions on Preferred Securities issued by
such Southern Union Trust shall be cumulative, (v) the amount or
amounts which shall be paid out of the assets of such Southern
Union Trust to the holders of Preferred Securities of such Southern
Union Trust upon voluntary or involuntary dissolution, winding-up
or termination of such Southern Union Trust, (vi) the obligation,
if any, of such Southern Union Trust to purchase or redeem
Preferred Securities issued by such Southern Union Trust and the
price or prices at which, the period or periods within which and
the terms and conditions upon which Preferred Securities issued by
such Southern Union Trust shall be purchased or redeemed, in whole
or in part, pursuant to such obligation, (vii) the voting rights,
if any, of Preferred Securities issued by such Southern Union Trust
in addition to those required by law, including the number of votes
per Preferred Security and any requirement for the approval by the
holders of Preferred Securities, or of Preferred Securities issued
by one or more Southern Union Trusts, or of both, as a condition to
specified action or amendments to the Declaration of such Southern
Union Trust, and (viii) any other relative rights, preferences,
privileges, limitations or restrictions of Preferred Securities
issued by such Southern Union Trust consistent with the Declaration
of such Southern Union Trust or with applicable law. All Preferred
Securities offered hereby will be guaranteed by Southern Union to
the extent set forth below under "Description of the Guarantees."
Certain United States federal income tax considerations applicable
to any offering of Preferred Securities will be described in the
Prospectus Supplement relating thereto.
In connection with the issuance of Preferred Securities, each
Southern Union Trust will issue one series of Common Securities.
The Declaration of each Southern Union Trust authorizes the Regular
Trustees of such trust to issue one series of Common Securities
having such terms including distributions, redemption, voting,
liquidation rights or such restrictions as shall be set forth
therein. The terms of the Common Securities issued by a Southern
Union Trust will be identical to the terms of the Preferred
Securities issued by such trust and the Common Securities will rank
pari passu, and payments will be made thereon pro rata with the
Preferred Securities except that, upon an Event of Default, the
rights of the holders of the Common Securities to payment in
respect of distributions and payments upon liquidation, redemption
and maturity will be subordinated to the rights of the holders of
the Preferred Securities. The Common Securities will also carry
the right to vote and to appoint or remove any of the Southern
Union Trustees of a Southern Union Trust. All of the Common
Securities of a Southern Union Trust will be directly or indirectly
owned by Southern Union.
DESCRIPTION OF THE GUARANTEES
Set forth below is a summary of information concerning the
Guarantees that will be executed and delivered by Southern Union
for the benefit of the holders, from time to time, of Preferred
Securities. The summary does not purport to be complete and is
subject in all respects to the provisions of, and is qualified in
its entirety by reference to, the form of Guarantee, which is filed
as an exhibit to the Registration Statement of which this
Prospectus forms a part.
<PAGE>
General
Pursuant to each Guarantee, Southern Union will irrevocably and
unconditionally agree, to the extent set forth herein, to pay in
full to the holders of the Preferred Securities issued by a
Southern Union Trust, the Guarantee Payments (as defined herein)
(except to the extent paid by such Southern Union Trust), as and
when due, regardless of any defense, right of set-off or
counterclaim which such Southern Union Trust may have or assert.
The following payments with respect to Preferred Securities issued
by a Southern Union Trust (the "Guarantee Payments"), to the extent
not paid by such Southern Union Trust will be subject to the
Guarantee (without duplication): (i) any accrued and unpaid
distributions that are required to be paid on such Preferred
Securities, to the extent such Southern Union Trust shall have
funds available therefor, (ii) the redemption price, including all
accrued and unpaid distributions (the "Redemption Price"), payable
out of funds available therefor with respect to any Preferred
Securities called for redemption by such Southern Union Trust and
(iii) upon a voluntary or involuntary dissolution, winding-up or
termination of such Southern Union Trust, the lesser of (a) the
aggregate of the liquidation amount and all accrued and unpaid
distributions on such Preferred Securities to the date of payment
or (b) the amount of assets of such Southern Union Trust remaining
available for distribution to holders of such Preferred Securities
in liquidation of such Southern Union Trust. Southern Union's
obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by Southern Union to the holders of
Preferred Securities or by causing the applicable Southern Union
Trust to pay such amounts to such holders.
Each Guarantee will be a full and unconditional guarantee with
respect to the Preferred Securities issued by the applicable
Southern Union Trust from the time of issuance of such Preferred
Securities but will not apply to any payment of distributions
except to the extent such Southern Union Trust shall have
sufficient cash on hand to permit such payment and funds legally
available therefor. If Southern Union does not make interest
payments on the Subordinated Debt Securities purchased by a
Southern Union Trust, such Southern Union Trust will not pay
distributions on the Preferred Securities issued by such Southern
Union Trust. See "Particular Terms of the Subordinated Debt
Securities."
Southern Union has also agreed to irrevocably and unconditionally
guarantee the obligations of the Southern Union Trusts (the "Common
Securities Guarantees") with respect to the Common Securities to
the same extent as the Guarantees, except that, upon an Event of
Default, holders of Preferred Securities shall have priority over
holders of Common Securities with respect to distributions and
payments on liquidation, redemption or maturity.
Certain Covenants of Southern Union
In each Guarantee, Southern Union will covenant that, so long as
any Preferred Securities issued by the applicable Southern Union
Trust remain outstanding, Southern Union will not declare or pay
any dividend on, or make any distribution with respect to, or
redeem, purchase, acquire or make a liquidation payment with
respect to, any of its capital stock, or make any guarantee payment
with respect to the foregoing, if at such time Southern Union shall
be in default with respect to its payment or other obligations
under the Guarantee or there shall have occurred any event that,
with the giving of notice or lapse of time or both, would
constitute an Event of Default under the Subordinated Debt
Securities Indenture. However, each Guarantee will except from the
foregoing any stock dividends paid by Southern Union where the
dividend stock is of the same class as that of the stock held by
the holders receiving the dividend.
Amendments and Assignment
Except with respect to any changes that do not adversely affect the
rights of holders of Preferred Securities (in which case no vote
will be required), each Guarantee may be amended only with the
prior approval of the holders of not less than 66 2/3% in liquidation
amount of the outstanding Preferred Securities issued by the
applicable Southern Union Trust. The manner of obtaining any such
approval of holders of such Preferred Securities will be set forth
in an accompanying Prospectus Supplement. All guarantees and
agreements contained in a Guarantee shall bind the successors,
assignees, receivers, trustees and representatives of Southern
Union and shall inure to the benefit of the holders of the
Preferred Securities of the applicable Southern Union Trust then
outstanding.
<PAGE>
Termination of the Guarantees
Each Guarantee will terminate and be of no further force and effect
as to the Preferred Securities issued by the applicable Southern
Union Trust upon full payment of the Redemption Price of all
Preferred Securities of such Southern Union Trust, upon
distribution of the Subordinated Debt Securities held by such
Southern Union Trust to the holders of the Preferred Securities of
such Southern Union Trust or upon full payment of the amounts
payable in accordance with the Declaration of such Southern Union
Trust upon liquidation of such Southern Union Trust. Each
Guarantee will continue to be effective or will be reinstated, as
the case may be, if at any time any holder of Preferred Securities
issued by the applicable Southern Union Trust must restore payment
of any sums paid under such Preferred Securities or the Guarantee.
Status of the Guarantees
Each Guarantee will constitute an unsecured obligation of Southern
Union and will rank (i) subordinate and junior in right of payment
to all other liabilities of Southern Union, (ii) pari passu with
the most senior preferred or preference stock now or hereafter
issued by Southern Union and with any guarantee now or hereafter
entered into by Southern Union in respect of any preferred or
preference stock of any affiliate of Southern Union and (iii)
senior to Southern Union's common stock. The Declaration of each
Southern Union Trust provides that each holder of Preferred Securi-
ties issued by such Southern Union Trust by acceptance thereof
agrees to the subordination provisions and other terms of the
applicable Guarantee.
Each Guarantee will constitute a guarantee of payment and not of
collection (that is, the guaranteed party may institute a legal
proceeding against the guarantor to enforce its rights under a
Guarantee without instituting a legal proceeding against any other
person or entity). Each Guarantee will be deposited with the
Regular Trustees of the applicable Southern Union Trust to be held
for the benefit of the holders of Preferred Securities issued by
such Southern Union Trust. In the event of the appointment of a
special representative by the Preferred Securities holders of a
Southern Union Trust (a "Special Representative") to, among other
things, enforce the Guarantee relating to the Preferred Securities
issued by such Southern Union Trust, the Special Representative may
take possession of such Guarantee for such purpose. If no Special
Representative has been appointed to enforce such Guarantee, or if
the appointed Special Representative fails to enforce the rights of
Preferred Securities holders under such Guarantee, the Regular
Trustees of such Southern Union Trust shall have the right to
enforce such Guarantee on behalf of the holders of such Preferred
Securities. The holders of not less than a majority in aggregate
liquidation amount of such Preferred Securities shall have the
right to direct the time, method and place of conducting any
proceeding for any remedy available in respect of the Guarantee,
including the giving of directions to the Regular Trustees or the
Special Representative, as the case may be. If the Regular
Trustees or the Special Representative fail to enforce a Guarantee
as provided above, any holder of such Preferred Securities may,
after a period of 30 days has elapsed from such holder's written
request to the Regular Trustees or the Special Representative, as
the case may be, to enforce such Guarantee, institute a legal
proceeding directly against Southern Union to enforce its rights
under a Guarantee without first instituting a legal proceeding
against the Southern Union Trust or any other person or entity. A
Guarantee will not be discharged except by payment of the Guarantee
Payments in full to the extent not paid by the applicable Southern
Union Trust.
Governing Law
The Guarantees will be governed by and construed in accordance with
the internal laws of the State of New York.
PLAN OF DISTRIBUTION
Southern Union may sell any series of the Debt Securities and the
Southern Union Trusts may sell the Preferred Securities in one or
more of the following ways from time to time (i) to or through
underwriters or dealers, (ii) directly to purchasers, or (iii)
through agents. The Prospectus Supplement with respect to any
Offered Securities will set forth (i) the terms of the offering of
the Offered Securities, including the name or names of any under-
writers, dealers or agents, (ii) the purchase price of the Offered
Securities and the proceeds to Southern Union or the applicable
Southern Union Trust as the case may be from such sale, (iii) any
underwriting discounts and commissions or agency fees and other
items constituting underwriters' or agents' compensation, (iv) any
initial public offering prices, (v) any discounts or concessions
allowed or reallowed or paid to dealers, and (vi) any securities
exchange on which such Offered Securities may be listed. Any
initial public offering price, discounts or concessions allowed or
reallowed or paid to dealers may be changed from time to time.
If underwriters are used in the sale, the Offered Securities will
be acquired by the underwriters for their own account and may be
resold from time to time in one or more transactions, including
negotiated transactions, at a fixed public offering price or at
varying prices determined at the time of sale. The Offered
Securities may be offered to the public either through underwriting
syndicates represented by one or more managing underwriters or
directly by one or more firms acting as underwriters. The
underwriter or underwriters with respect to a particular
underwritten offering of Offered Securities will be named in the
Prospectus Supplement relating to such offering and, if an
underwriting syndicate is used, the managing underwriter or
underwriters will be set forth on the cover of such Prospectus
Supplement. Unless otherwise set forth in the Prospectus
Supplement relating thereto, the obligations of the underwriters to
purchase the Offered Securities will be subject to certain
conditions precedent, and the underwriters will be obligated to
purchase all the Offered Securities if any are purchased.
If dealers are utilized in the sale of Offered Securities, Southern
Union and/or the applicable Southern Union Trust will sell such
Offered Securities to the dealers as principals. The dealers may
then resell such Offered Securities to the public at varying prices
to be determined by such dealers at the time of resale. The names
of the dealers and the terms of the transaction will be set forth
in the Prospectus Supplement relating thereto.
Any series of Debt Securities may be sold from time to time either
directly by Southern Union or through agents designated by Southern
Union. Any series of Preferred Securities may be sold from time to
time either directly by the applicable Southern Union Trust or by
agents designated by such trust. Any agent involved in the offer
or sale of the Offered Securities in respect to which this
Prospectus is delivered will be named, and any commissions payable
to Southern Union and/or the applicable Southern Union Trust to
such agent will be set forth, in the Prospectus Supplement relating
thereto. Unless otherwise indicated in the Prospectus Supplement,
any such agent will be acting on a best efforts basis for the
period of its appointment.
The Debt Securities may be sold directly by Southern Union and the
Preferred Securities may be sold directly by the applicable
Southern Union Trust to institutional investors or others who may
be deemed to be underwriters within the meaning of the Securities
Act with respect to any resale thereof. The terms of any such
sales will be described in the Prospectus Supplement relating
thereto.
If so indicated in the Prospectus Supplement, Southern Union and/or
the applicable Southern Union Trust will authorize agents,
underwriters or dealers to solicit offers from certain types of
institutions to purchase Offered Securities from Southern Union
and/or the applicable Southern Union Trust at the public offering
price set forth in the Prospectus Supplement pursuant to delayed
delivery contracts providing for payment and delivery on a
specified date in the future. Such contracts will be subject only
to those conditions set forth in the Prospectus Supplement, and the
Prospectus Supplement will set forth the commission payable for
solicitation of such contracts.
Agents, dealers and underwriters may be entitled under agreements
with Southern Union and/or the applicable Southern Union Trust to
indemnification by Southern Union and/or such Southern Union Trust
against certain civil liabilities, including liabilities under the
Securities Act, or to contribution with respect to payments that
such agents, dealers or underwriters may be required to make in
respect thereof. Agents, dealers and underwriters may be customers
of, engage in transactions with, or perform services for Southern
Union and/or the applicable Southern Union Trust in the ordinary
course of business.
Each series of Offered Securities will be a new issue of securities
and will have no established trading market. Any underwriters to
whom Offered Securities are sold for public offering and sale may
make a market in such Offered Securities, but such underwriters
will not be obligated to do so and may discontinue any market
making at any time without notice. The Offered Securities may or
may not be listed on a national securities exchange. No assurance
can be given that there will be a market for the Offered
Securities.
<PAGE>
VALIDITY OF SECURITIES
The validity of the Offered Securities offered hereby will be
passed upon for Southern Union by Fleischman and Walsh, L.L.P.,
Washington, D. C. Aaron I. Fleischman, Senior Partner of
Fleischman and Walsh, L.L.P., is a director of Southern Union.
Mr. Fleischman, Fleischman and Walsh, L.L.P., and other attorneys
in that firm beneficially own shares of common stock that, in the
aggregate, represent less than two percent (2%) of the shares of
common stock outstanding.
EXPERTS
The consolidated financial statements and related financial
statement schedules included in Southern Union Company's Transition
Report on Form 10-K for the year ended June 30, 1994 are
incorporated by reference in this Prospectus in reliance upon the
reports of Coopers & Lybrand L.L.P., given on the authority of that
firm as experts in accounting and auditing.
<PAGE>
_______________________________ _______________________________
No dealer, salesperson or other
individual has been authorized
to give any information or to
make any representations other
than those contained or incor-
porated by reference in this Southern Union Company
Prospectus in connection with
the offer made by this Senior Debt Securities and
Prospectus and, if given or Subordinated Debt Securities
made, such information or repre- and
sentations must not be Southern Union Financing I
relied upon as having been Southern Union Financing II
authorized by Southern Union Southern Union Financing III
Company, Southern Union Preferred Securities
Financing I, Southern Union guaranteed to the extent set
Financing II, or Southern Union forth herein by
Financing III or the Southern Union Company
Underwriters. Neither the
delivery of this Prospectus nor
any sale made hereunder and
thereunder shall under any
circumstance create an implica-
tion that there has been no
change in the affairs of
Southern Union Company or
Southern Union Financing I,
Southern Union Financing II or
Southern Union Financing III
since the date hereof. This
Prospectus does not constitute
an offer or solicitation by
anyone in any state in which _______________________
such offer or solicitation is
not authorized or in which the PROSPECTUS
person making such offer or
solicitation is not qualified _______________________
to do so or to anyone to whom
it is unlawful to make such
offer or solicitation.
____________________
TABLE OF CONTENTS
Page
____
Available Information. . .
Incorporation of Certain
Documents by Reference .
Southern Union Company . .
Southern Union Financing
Trusts . . . . . . . . .
Use of Proceeds. . . . . .
Ratio of Earnings to Fixed
Charges. . . . . . . . .
Description of Southern
Union Debt Securities. .
General. . . . . . . .
Registration and
Transfer . . . . . .
Global Securities. . .
Restrictions . . . . .
Limitation on Sale
and Leaseback
Transactions . . . .
Events of Default. . .
Modification or
Waiver . . . . . . .
Financial Information.
Certain Definitions. .
Particular Terms of the
Senior Debt Securities .
Particular Terms of the
Subordinated Debt
Securities . . . . . .
Description of the
Southern Union Trusts'
Preferred Securities . .
Description of the
Guarantees . . . . . . . March , 1995
Plan of Distribution . . .
Validity of Securities . .
Experts. . . . . . . . . .
_______________________________ _______________________________
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.*
Securities and Exchange Commission Filing Fee. . . $103,449.00
Rating Agency Fees. . . . . . . . . . . . . . . . *
Blue Sky Fees and Expenses. . . . . . . . . . . . *
Trustee's Expenses. . . . . . . . . . . . . . . . *
Printing and Engraving Fees . . . . . . . . . . . *
Accounting Fees and Expenses. . . . . . . . . . . *
Legal Fees and Expenses . . . . . . . . . . . . . *
Miscellaneous . . . . . . . . . . . . . . . . . . *
__________
Total. . . . . . . . . . . . . . . . . . . . *
==========
_________________________________
* All fees and expenses other than SEC Registration Fee are
estimated. To be completed by amendment.
Item 15. Indemnification of Directors and Officers.
Article Fourteenth of the Restated Certificate of Incorporation of
Southern Union eliminates personal liability of directors to the
fullest extent permitted by Delaware Law. Section 145 of the
Delaware Corporation Law provides that a Delaware corporation may
indemnify any person against expenses, fines and settlements
actually and reasonably incurred by any such person in connection
with a threatened, pending or completed action, suit or proceeding
in which he is involved by reason of the fact that he is or was a
director, officer, employee or agent of such corporation, provided
that (i) he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the
corporation and (ii) with respect to any criminal action or
proceeding, he had no reasonable cause to believe his conduct was
unlawful. If the action or suit is by or in the name of the
corporation, the corporation may indemnify any such person against
expenses actually and reasonably incurred by him in connection with
the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation, except that no
indemnification may be made in respect to any claim, issue or
matter as to which such person shall have been adjudged to be
liable for negligence or misconduct in the performance of his duty
to the corporation, unless and only to the extent that the Delaware
Court of Chancery or the court in which the action or suit is
brought determines upon application that, despite the adjudication
of liability but in the light of the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such
expense as the court deems proper.
The Declaration of each Southern Union Trust provides that no
Southern Union Trustee, affiliate of any Southern Union Trustee, or
any officers, directors, shareholders, members, partners,
employees, representatives or agents of any Southern Union Trustee,
or any employee or agent of such Southern Union Trust or its
affiliates (each an "Indemnified Person") shall be liable,
responsible or accountable in damages or otherwise to such Southern
Union Trust or any employee or agent of the trust or its affiliates
for any loss, damage or claim incurred by reason of any act or
omission performed or omitted by such Indemnified Person in good
faith on behalf of such Southern Union Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of
the authority conferred on such Indemnified Person by such
Declaration or by law, except that an Indemnified Person shall be
liable for any such loss, damage or claim incurred by reason of
such Indemnified Person's gross negligence or willful misconduct
with respect to such acts or omissions. The Declaration of each
Southern Union Trust also provides that to the fullest extent
permitted by applicable law, Southern Union shall indemnify and
hold harmless each Indemnified Person from and against any loss,
damage or claim incurred by such Indemnified Person by reason of
any act or omission performed or omitted by such Indemnified Person
in good faith on behalf of such Southern Union Trust and in a
manner such Indemnified Person reasonably believed to be within the
scope of authority conferred on such Indemnified Person by such
<PAGE>
Declaration, except that no Indemnified Person shall be entitled to
be indemnified in respect of any loss, damage or claim incurred by
such Indemnified Person by reason of gross negligence or willful
misconduct with respect to such acts or omissions. The Declaration
of each Southern Union Trust further provides that, to the fullest
extent permitted by applicable law, expenses (including legal fees)
incurred by an Indemnified Person in defending any claim, demand,
action, suit or proceeding shall, from time to time, be advanced by
Southern Union prior to the final disposition of such claim,
demand, action, suit or proceeding upon receipt by or an
undertaking by or on behalf of the Indemnified Person to repay such
amount if it shall be determined that the Indemnified Person is not
entitled to be indemnified for the underlying cause of action as
authorized by such Declaration.
The directors and officers of Southern Union and the Regular
Trustees are covered by insurance policies indemnifying against
certain liabilities, including certain liabilities arising under
the Securities Act of 1933, as amended (the "Securities Act"),
which might be incurred by them in such capacities and against
which they cannot be indemnified by Southern Union or the Southern
Union Trusts.
Any agents, dealers or underwriters who execute any of the
agreements filed as Exhibit 1 to this registration statement will
agree to indemnify Southern Union's directors and their officers
and
the Southern Union Trustees who signed the registration statement
against certain liabilities that may arise under the Securities Act
with respect to information furnished to Southern Union or any of
the Southern Union Trusts by or on behalf of any such indemnifying
party.
Item 16. Exhibits.
Exhibits identified in parentheses below are on file with the SEC
and are incorporated herein by reference to such previous filings.
All other exhibits are provided as part of this electronic
transmission.
*1 - Form of Underwriting Agreement for offering of
Preferred Securities.
4-A - Certificate of Trust of Southern Union Financing I.
4-B - Certificate of Trust of Southern Union Financing II.
4-C - Certificate of Trust of Southern Union Financing III.
*4-D - Form of Declaration of Trust of Southern Union
Financing I.
*4-E - Form of Declaration of Trust of Southern Union
Financing II.
*4-F - Form of Declaration of Trust of Southern Union
Financing III.
*4-G - Form of Subordinated Debt Securities Indenture among
Southern Union Company and __________________________,
as Trustee.
*4-H - Form of Supplemental Indenture to Indenture to be used
in connection with the issuance of Subordinated Debt
Securities and Preferred Securities.
*4-I - Form of Preferred Security (included in 4-D above).
*4-J - Form of Subordinated Debt Security (included in 4-H
above).
*4-K - Form of Guarantee with respect to Preferred Securities.
4-L - Senior Debt Securities Indenture between Chase
Manhattan Bank, N.A., as trustee, and Southern Union
Company dated January 31, 1994. (Filed as Exhibit 4.1
to Southern Union's Current Report on Form 8-K dated
February 15, 1994 and incorporated herein by
reference.)
*5 - Opinion of Fleischman and Walsh, L.L.P.
12 - Computation of Ratio of Earnings to Fixed Charges of
Southern Union Company.
23-A - Consent of Independent Accountants, Coopers & Lybrand
L.L.P.
23-B - Consent of Fleischman and Walsh, L.L.P. is contained in
the opinion of counsel filed as Exhibit 5.
24 - Powers of Attorney (the powers of attorney for the
Southern Union Trustees of Southern Union Financing I,
Southern Union Financing II and Southern Union
Financing III are included in Exhibits 4-A, 4-B and 4-
C, respectively).
*25-A - Statement of Eligibility under the Trust Indenture Act
of 1939, as amended, of ________________, as Trustee
under the Subordinated Debt Securities Indenture.
*25-B - Statement of Eligibility under the Trust Indenture Act
of 1939, as amended, of ________________, as Trustee
under the Senior Debt Securities Indenture.
________________________________
* To be filed by amendment.
<PAGE>
Item 17. Undertaking.
The Registrants hereby undertake that, for purposes of determining
any liability under the Securities Act, each filing of Southern
Union's Annual Report pursuant to Section 13(a) or Section 15(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act") (and where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Exchange Act)
that is incorporated by reference in the Registration Statement
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and
controlling persons of the Registrants pursuant to the provisions
referred to in Item 15 (other than the insurance policies referred
to therein), or otherwise, the Registrants have been advised that,
in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the Act
and
is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the Registrants of expenses incurred or paid by a director, officer
or controlling person of the Registrants in the successful defense
of any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities
being registered, the Registrants will, unless in the opinion of
their counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
The Registrants hereby undertake:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration
Statement
(i) to include any prospectus required by Section 10(a)(3)
of the Securities Act;
(ii) to reflect in the prospectus any facts or events
arising after the effective date of the Registration
Statement (or the most recent post-effective amendment
thereof) that, individually or in the aggregate,
represent a fundamental change in the information set
forth in the Registration Statement;
(iii) to include any material information with respect to the
Plan of Distribution not previously disclosed in the
Registration Statement or any material change to such
information in the Registration Statement;
provided, however, that the undertakings set forth in paragraphs
(i)
and (ii) above do not apply if the information required to be
included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by Southern Union pursuant to
Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
The Registrants hereby undertake that:
(1) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed
as part of a registration statement in reliance upon Rule 430A
and contained in the form of prospectus filed by the
registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under
the Securities Act shall be deemed to be part of the
registration statement as of the time it was declared
effective.
(2) For the purposes of determining any liability under the
Securities Act, each post-effective amendment that contains a
form of prospectus shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that
it meets the requirements for filing on Form S-3 and has duly
caused this Registration Statement to be signed on its behalf by
the undersigned, thereunto duly authorized in the City of Austin,
State of Texas, on March 29, 1995.
SOUTHERN UNION COMPANY
By RONALD J. ENDRES
_____________________________
Ronald J. Endres
Senior Vice President of
Administration and Chief
Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in
the capacities indicated on March 29, 1995.
Signature/Name Title
______________ _____
GEORGE L. LINDEMANN* Chairman of the Board,
Chief Executive Officer
and Director
JOHN E. BRENNAN* Director
FRANK W. DENIUS* Director
AARON I. FLEISCHMAN* Director
PETER H. KELLEY* Director
ADAM M. LINDEMANN* Director
ROGER J. PEARSON* Director
GEORGE ROUNTREE, III* Director
DAN K. WASSONG* Director
RONALD J. ENDRES Senior Vice President
________________
Ronald J. Endres of Administration, and
Chief Financial Officer
DAVID J. KVAPIL Vice President and
_______________
David J. Kvapil Controller
(Principal Accounting
Officer)
*By RONALD J. ENDRES
________________
Ronald J. Endres
Attorney-in-fact
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, each of
Southern Union Financing I, Southern Union Financing II and
Southern Union Financing III certifies that it has reasonable
grounds to believe that it meets all the requirements for filing on
Form S-3 and has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized,
in the City of Austin, State of Texas, on the 29th day of March,
1995.
SOUTHERN UNION FINANCING I
By RONALD J. ENDRES
________________
Ronald J. Endres, Trustee
By DAVID J. KVAPIL
_______________
David J. Kvapil, Trustee
SOUTHERN UNION FINANCING II
By RONALD J. ENDRES
________________
Ronald J. Endres, Trustee
By DAVID J. KVAPIL
_______________
David J. Kvapil, Trustee
SOUTHERN UNION FINANCING III
By RONALD J. ENDRES
________________
Ronald J. Endres, Trustee
By DAVID J. KVAPIL
_______________
David J. Kvapil, Trustee
<PAGE>
EXHIBIT INDEX
*1 - Form of Underwriting Agreement for offering of
Preferred Securities.
4-A - Certificate of Trust of Southern Union Financing I.
4-B - Certificate of Trust of Southern Union Financing II.
4-C - Certificate of Trust of Southern Union Financing III.
*4-D - Form of Declaration of Trust of Southern Union
Financing I.
*4-E - Form of Declaration of Trust of Southern Union
Financing II.
*4-F - Form of Declaration of Trust of Southern Union
Financing III.
*4-G - Form of Subordinated Debt Securities Indenture among
Southern Union Company and __________________________,
as Trustee.
*4-H - Form of Supplemental Indenture to Indenture to be used
in connection with the issuance of Subordinated Debt
Securities and Preferred Securities.
*4-I - Form of Preferred Security (included in 4-D above).
*4-J - Form of Subordinated Debt Security (included in 4-H
above).
*4-K - Form of Guarantee with respect to Preferred Securities.
4-L - Senior Debt Securities Indenture between Chase
Manhattan Bank, N.A., as trustee, and Southern Union
Company dated January 31, 1994. (Filed as Exhibit 4.1
to Southern Union's Current Report on Form 8-K dated
February 15, 1994 and incorporated herein by
reference.)
*5 - Opinion of Fleischman and Walsh, L.L.P.
12 - Computation of Ratio of Earnings to Fixed Charges of
Southern Union Company.
23-A - Consent of Independent Accountants, Coopers & Lybrand
L.L.P.
23-B - Consent of Fleischman and Walsh, L.L.P. is contained in
the opinion of counsel filed as Exhibit 5.
24 - Powers of Attorney (the powers of attorney for the
Southern Union Trustees of Southern Union Financing I,
Southern Union Financing II and Southern Union
Financing III are included in Exhibits 4-A, 4-B and 4-
C, respectively).
*25-A - Statement of Eligibility under the Trust Indenture Act
of 1939, as amended, of ________________, as Trustee
under the Subordinated Debt Securities Indenture.
*25-B - Statement of Eligibility under the Trust Indenture Act
of 1939, as amended, of ________________, as Trustee
under the Senior Debt Securities Indenture.
________________________________
* To be filed by amendment.
<PAGE>
EXHIBIT 4-A
CERTIFICATE OF TRUST
<PAGE>
EXHIBIT 4-A
CERTIFICATE OF TRUST
The undersigned, the trustees of Southern Union Financing I,
desiring to form a business trust pursuant to Delaware Business
Trust Act, 12 DEL. C. c. 38, hereby certify as follows:
1. The name of the business trust being formed hereby (the
"Trust") is Southern Union Financing I.
2. The name and business address of the trustee of the Trust
which has its principal place of business in the State of
Delaware is as follows:
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890
Dated: March 28, 1995
By RONALD J. ENDRES
________________
Ronald J. Endres, as Trustee
By DAVID J. KVAPIL
_______________
David J. Kvapil, as Trustee
By BRUCE L. BISSON
_______________
Wilmington Trust Company, as
Trustee
Name: Bruce L. Bisson
Title: Vice President
<PAGE>
EXHIBIT 4-B
CERTIFICATE OF TRUST
<PAGE>
EXHIBIT 4-B
CERTIFICATE OF TRUST
The undersigned, the trustees of Southern Union Financing II,
desiring to form a business trust pursuant to Delaware Business
Trust Act, 12 DEL. C. c. 38, hereby certify as follows:
1. The name of the business trust being formed hereby (the
"Trust") is Southern Union Financing II.
2. The name and business address of the trustee of the Trust
which has its principal place of business in the State of
Delaware is as follows:
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890
Dated: March 28, 1995
By RONALD J. ENDRES
________________
Ronald J. Endres, as Trustee
By DAVID J. KVAPIL
_______________
David J. Kvapil, as Trustee
By BRUCE L. BISSON
_______________
Wilmington Trust Company, as
Trustee
Name: Bruce L. Bisson
Title: Vice President
<PAGE>
EXHIBIT 4-C
CERTIFICATE OF TRUST
<PAGE>
EXHIBIT 4-C
CERTIFICATE OF TRUST
The undersigned, the trustees of Southern Union Financing III,
desiring to form a business trust pursuant to Delaware Business
Trust Act, 12 DEL. C. c. 38, hereby certify as follows:
1. The name of the business trust being formed hereby (the
"Trust") is Southern Union Financing III.
2. The name and business address of the trustee of the Trust
which has its principal place of business in the State of
Delaware is as follows:
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890
Dated: March 28, 1995
By RONALD J. ENDRES
________________
Ronald J. Endres, as Trustee
By DAVID J. KVAPIL
_______________
David J. Kvapil, as Trustee
By BRUCE L. BISSON
_______________
Wilmington Trust Company, as
Trustee
Name: Bruce L. Bisson
Title: Vice President
<PAGE>
EXHIBIT 12
RATIO OF EARNINGS TO FIXED CHARGES
<PAGE>
EXHIBIT 12
RATIO OF EARNINGS TO FIXED CHARGES
Twelve Six
Months Months
Ended Year Ended
Decem- Ended Decem- Year Ended
ber 31, June 30, ber 31, December 31,
________________________________
1994 1994(a) 1994 1993 1992 1991 1990
_______ ________ _______ _______ _______ _______ _______
(dollars in thousands)
EARNINGS:
Consoli-
dated
pretax
income
from
con-
tinuing
opera-
tions. .$ 8,759 $13,563 $ 611 $11,588 $10,831 $11,308 $ 1,413
Interest. 38,417 25,464 20,229 13,747 12,459 12,581 12,519
Net
amorti-
zation
of debt
discount
and pre-
mium and
issuance
expense. 1,183 941 568 604 495 462 450
Interest
portion
of ren-
tal ex-
pense. . 1,513 1,341 520 995 1,025 813 579
_______ _______ _______ _______ _______ _______ _______
Earnings.$49,872 $41,309 $21,928 $26,934 $24,810 $25,164 $14,961
======= ======= ======= ======= ======= ======= =======
FIXED CHARGES:
Interest.$38,417 $25,464 $20,229 $13,747 $12,459 $12,581 $12,519
Net
amorti-
zation
of debt
discount
and pre-
mium and
issuance
expense. 1,183 941 568 604 495 462 450
Interest
portion
of ren-
tal ex-
pense. . 1,513 1,341 520 995 1,025 813 579
_______ _______ _______ _______ _______ _______ _______
Fixed
charges.$41,113 $27,746 $21,317 $15,346 $13,979 $13,856 $13,548
======= ======= ======= ======= ======= ======= =======
Ratio of
earnings
to fixed
charges. 1.21 1.49 1.03 1.76 1.77 1.82 1.10
======= ======= ======= ======= ======= ======= =======
__________________________
(a) During 1994, the Company changed its fiscal year-end from
December 31 to June 30.
<PAGE>
EXHIBIT 12
RATIO OF EARNINGS TO FIXED CHARGES
Pro Forma (a)
_____________________________
Twelve Months Year
Ended Ended
December 31, June 30,
1994 1994
_____________ __________
(dollars in thousands)
EARNINGS:
Consolidated pretax income from
continuing operations. . . . . . . $ 16,194 $ 16,529
Interest . . . . . . . . . . . . . . 39,504 39,744
Net amortization of debt discount
and premium and issuance expense . 1,136 1,136
Interest portion of rental expense . 1,684 1,684
________ ________
Earnings . . . . . . . . . . . . $ 58,518 $ 59,093
======== ========
FIXED CHARGES:
Interest . . . . . . . . . . . . . . $ 39,504 $ 39,744
Net amortization of debt discount
and premium and issuance expense . 1,136 1,136
Interest portion of rental expense . 1,684 1,684
________ ________
Fixed charges. . . . . . . . . . $ 42,324 $ 42,564
======== ========
Ratio of earnings to fixed charges . 1.38 1.39
======== ========
_______________________________
(a) To give effect to increase in outstanding debt, as of the
beginning of the period presented, primarily as a result of
the January 31, 1994 acquisition of Missouri Gas Energy, which
was financed through the sale of $475 million of 7.60% Senior
Notes. Those debt proceeds, along with proceeds of a $50
million common stock rights offering and working capital from
operations, were also used to retire approximately $105
million of long-term debt. This ratio also assumes the
acquisition of Missouri Gas Energy occurred as of the
beginning of the period presented, as reflected in the pro
forma condensed statement of consolidated operations included
in the 1994 Form 10-K and the December 31, 1994 Second Quarter
Form 10-Q.
<PAGE>
EXHIBIT 23-A
CONSENT OF INDEPENDENT ACCOUNTANTS
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS Exhibit 23-A
We consent to the incorporation by reference in this registration
statement on Form S-3 (File No. 33-__________________) of our
report, which includes an explanatory paragraph concerning certain
accounting changes, dated September 15, 1994, on our audit of the
consolidated financial statements and financial statement schedules
of Southern Union Company and Subsidiaries as of June 30, 1994 and
December 31, 1993, and for each of the three years in the periods
ended June 30, 1994 and December 31, 1993 and 1992. We also
consent to the reference to our firm under the caption "Experts."
COOPERS & LYBRAND L.L.P.
Austin, Texas
March 27, 1995
