As filed with the Securities and Exchange Commission on February 4, 2000.
Registration No.333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
SOUTHWESTERN ENERGY COMPANY
(Exact name of registrant as specified in its charter)
Arkansas 71-0205415
(State or other jurisdiction of (I.R.S. employer identification no.)
incorporation or organization)
1083 Sain Street
Fayetteville, Arkansas 72703
(Address of principal executive offices including zip code)
Employee Stock Option and Restricted Stock Agreements
(Full title of the plan)
George A. Taaffe, Jr.
1083 Sain Street
Fayetteville, Arkansas 72703
(501) 521-1141
(Name, address and telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
============== ================ ================ ================ ==============
Title of Amount Proposed Proposed
secturities to be maximum maximum Amount of
to be registered offering price aggregate registration
registered (1)(2)(3) per share offering price fee
- -------------- ---------------- ---------------- ---------------- --------------
Common Stock, 206,785 shares $5.6875(4) $1,176,089.69(4) $310.50
$.10 par value
============== ================ ================ ================ ==============
(1) Pursuant to Rule 416, this Registration Statement also covers such
indeterminable number of additional shares of common stock as may become
issuable pursuant to terms designed to prevent dilution resulting from stock
splits, stock dividends, merger or combination or similar events.
(2) Each share is accompanied by a common stock purchase right pursuant to the
Amended and Restated Rights Agreement, dated April 12, 1999, with First Chicago
Trust Company of New York, as Rights Agent.
(3) Does not include an additional:
(a) 1,275,000 shares of common stock being carried forward pursuant to Rule 429
from the Registration Statement on Form S-8, File No. 333-03787 (a registration
fee of $6,397.85 was paid in connection with the filing of such registration
statement) and (b) 616,480 shares of common stock being carried forward pursuant
to Rule 429 from the Registration Statement on Form S-8, File No. 333-64961 (a
registration fee of $1,771.00 was paid in connection with the filing of such
registration statement).
(4) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457 based on (a) an aggregate of 147,000 shares presently
subject to stock options at an exercise price of $6.00 per share and (b) the
average of the high and low sale prices reported on the New York Stock Exchange
on February 1, 2000, of $5.6875 per share with respect to the reoffering or
resales of 59,785 shares awarded under certain restricted stock agreements.
<PAGE>
STATEMENT OF INCORPORATION BY REFERENCE AND EXPLANATORY NOTE
This Registration Statement on Form S-8 incorporates by reference the
contents of the Registration Statement on Form S-8, File No. 333-03787, filed by
Southwestern Energy Company (the "Company") with the Securities and Exchange
Commission (the "SEC") on May 15, 1996, relating to the Company's 1993 Stock
Incentive Plan and the Registration Statement on Form S-8, File No. 333-64961,
filed by the Company with the SEC on September 30, 1998, relating to the
Company's 1993 Stock Incentive Plan, shares of the Company's common stock which
may be issued upon the exercise of stock option agreements granted by the
Company to certain employees and shares of the Company's common stock awarded by
the Company to certain employees pursuant to restricted stock agreements and
which may be resold by these employees pursuant to the prospectus filed as a
part of this Registration Statement . This Registration Statement on Form S-8
registers an additional (i) 147,000 shares of the Company's common stock which
may be issued upon the exercise of stock option agreements granted by the
Company and (ii) 59,785 shares of the Company's common stock issued to certain
employees pursuant to restricted stock agreements and which may be resold by
these employees pursuant to the prospectus filed as a part of this Registration
Statement.
The information required by Part I of Form S-8 to be contained in the
Section 10(a) prospectus to be used for offers and sales of the Company's common
stock covered by this Registration Statement has been omitted in accordance with
Rule 428 under the Securities Act of 1933, as amended, and the Note to Part I of
Form S-8. The prospectus filed as a part of this Registration Statement (the
"Reoffer Prospectus") has been prepared in accordance with the requirements of
Part I of Form S-3 pursuant to the Instructions to Form S-8, and the Reoffer
Prospectus may be used for reofferings and resales of the Company's common stock
owned or acquired by the persons named therein.
<PAGE>
PROSPECTUS
Southwestern Energy Company
1,455,627 Shares of Common Stock
This prospectus relates to up to 1,455,627 shares of common stock of
Southwestern Energy Company which may be offered for resale by certain of our
officers and employees. See "Selling Shareholders." The selling shareholders
have acquired the shares through the exercise of stock options granted to them
under our 1993 Stock Incentive Plan and or under separate stock option
agreements or through awards of shares under separate restricted stock
agreements.
It is anticipated that the selling shareholders will offer the shares
for sale at prevailing prices on the New York Stock Exchange on the date of
sale. We will not receive any of the proceeds from the sale of the shares by the
selling shareholders. All expenses of registration incurred in connection
herewith are being borne by us, however, all selling commissions and other
expenses incurred by any selling shareholder in connection with the sale of
shares will be borne by the selling shareholder.
The selling shareholders and any broker or dealer participating in the
sale of shares on behalf of the selling shareholders may be deemed to be
"underwriters" within the meaning of the Securities Act, in which case any
profit on the sale of shares by them or commissions received by such broker or
dealer may be deemed to be underwriting commissions under the Securities Act of
1933.
Our common stock is listed on the New York Stock Exchange under the
symbol "SWN." The last reported sale price of our common stock on the New York
Stock Exchange on February 3, 2000, was $6.25.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined whether
this prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this Prospectus is February 4, 2000
<PAGE>
You should rely only on the information contained or incorporated by
reference in this prospectus or any supplement. We have not authorized anyone to
provide you with different information. Shares of common stock are being offered
and sold only in states where offers and sales are permitted. You should not
assume that the information contained in this prospectus is accurate as of any
date other than the date of this prospectus.
TABLE OF CONTENTS
Page
Where You Can Find More Information . . . . . . . . . . . . . . . . . . . . 2
Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Selling Shareholders. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Plan of Distribution. . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Legal Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission (the "SEC"). You
may read and copy any reports, statements or other information we file at the
SEC's public reference room at 450 Fifth Street, N.W., Washington, D.C. 20549,
or at the SEC's public reference rooms in New York, New York and Chicago,
Illinois. Please call the SEC at 1-800-SEC-0330 for further information on the
public reference rooms. Our filings with the SEC are also available to the
public from the SEC's web site at http://www.sec.gov. Our reports, proxy
statements and other information filed with the SEC can also be inspected at the
New York Stock Exchange, 20 Broad Street, New York, New York 10005.
This prospectus constitutes a part of a registration statement on Form
S-8 filed by us with the SEC. As allowed by the rules and regulations of the
SEC, this prospectus does not contain all the information you can find in the
registration statement and the exhibits to the registration statement. For
further information with respect to us and the securities described in this
prospectus, you should refer to the registration statement, including its
exhibits. Furthermore, the statements contained in this prospectus concerning
any document filed as an exhibit are not necessarily complete and, in each
instance, we refer you to a copy of the document filed as an exhibit to the
registration statement.
The SEC allows us to "incorporate by reference" the information we file
with them into this prospectus, which means we can disclose important
information to you by referring you to those documents. The information
incorporated by reference is considered to be a part of this prospectus (except
for any information that is superseded by the information included directly in
this prospectus), and information that we file later with the SEC will
automatically update and supersede the information in this prospectus. We
incorporate by reference the documents listed
2
<PAGE>
below and any future filings we make with the SEC under Sections 13(a), 13(c),
14 or 15(d) of the Securities Exchange Act of 1934 until all the securities are
sold:
- Our Annual Report on Form 10-K for the year ended December 31,
1998;
- Our Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1999, June 30, 1999 and September 30, 1999;
- Our Current Reports on Form 8-K filed with the SEC on April 8,
1999 and October 20, 1999;
- The description of our common stock contained in our
Registration Statement on Form 8-A dated October 23, 1981, as
updated by our Current Report on Form 8-K dated July 8, 1993;
and
- The description of our common stock purchase rights contained
in Amendment No. 1 to our Registration Statement on Form 8-A
dated April 26, 1999.
We will provide you with a copy of these filings incorporated by
reference, at no cost, upon written or oral request. Written requests should be
directed to Southwestern Energy Company, P. O. Box 1408, Fayetteville, Arkansas
72702-1408, Attention: Corporate Secretary. Telephone requests may be directed
to (501) 521-1141.
USE OF PROCEEDS
Shares which may be sold pursuant to this prospectus will be sold by
the selling shareholders for their own accounts and they will receive all
proceeds from any such sale. We will not receive any of the proceeds from any
sale of the shares, but we may receive funds upon the exercise of any of the
stock options granted to the selling shareholders. Any funds we receive on
option exercises will be added to our general funds for working capital and
general corporate purposes. See "Selling Shareholders" and "Plan of
Distribution."
SELLING SHAREHOLDERS
The shares offered under this prospectus are being registered for
reoffers and resales by selling shareholders who may acquire or have acquired
the shares pursuant to stock grants or pursuant to the exercise of stock options
granted to them. The selling shareholders named in the following table may
resell all, a portion of, or none of the shares they may acquire.
Participants under our 1993 Stock Incentive Plan who are deemed to be
"affiliates" of Southwestern Energy Company who acquire shares or options to
acquire shares may be added to the selling shareholders listed below from time
to time, and the number of shares eligible to be reoffered by the selling
shareholders listed below may be adjusted, either by means of a post-effective
amendment hereto or by use of a prospectus supplement filed pursuant to Rule
424(b) under the Securities Act.
3
<PAGE>
The following table sets forth information concerning the selling
shareholders and the number of shares that may be offered hereby by each selling
shareholder as of the date of this prospectus.
<TABLE>
<CAPTION>
Number of Shares
That May be
Selling Shareholder Position with the Company Offered Hereby
<S> <C> <C>
Charles E. Scharlau Chairman of the Board 414,996(1)
Harold M. Korell President and Chief Executive Officer 350,132(1)
Alan H. Stevens President and COO, Southwestern Energy 211,000(2)
Production Company, SEECO, Inc. and
Diamond "M" Production Company
Gregory D. Kerley Executive Vice President and 174,273(1)
Chief Financial Officer
Debbie J. Branch Senior Vice President, Southwestern Energy Services 49,920(1)
Company and Southwestern Energy
Pipeline Company
Charles V. Stevens Senior Vice President, Arkansas Western Gas 64,643(1)
Company
George A. Taaffe Senior Vice President, General Counsel and Secretary 22,800(1)
Richard F. Lane Vice President--Exploration, Southwestern Energy 51,820(3)
Production Company
Timothy J. O'Donnell Vice President--Human Resources, Treasurer and 22,130(1)
Assistant Secretary
Stanley T. Wilson Controller and Chief Accounting Officer 20,668(1)
John W. Batson Staff Geophysicist, Southwestern Energy 2,500(4)
Production Company
Wilfred W. Baumann Manager, E & P Accounting, Southwestern Energy 420(4)
Production Company
Charles A. Bayles Manager, Pipeline Systems, Arkansas Western Gas 420(4)
Company
Alan E. Bearden, Jr. Manager, Accounting 420(4)
Thomas A. Brock Senior Landman, Southwestern Energy Production 1,000(4)
Company
Susan D. Burks Manager, Gas Accounting and Analysis, Arkansas 1,000(4)
Western Gas Company
William K. Butler Senior Production Engineer, Southwestern Energy 1,420(4)
Production Company
4
<PAGE>
Number of Shares
That May be
Selling Shareholder Position with the Company Offered Hereby
<S> <C> <C>
Donna R. Campbell Utility Rate Analyst, Arkansas Western Gas Company 420(4)
Alan R. Clemens Staff Geophysicist, Southwestern Energy 2,500(4)
Production Company
W. Brooks Clower, Jr. Attorney 420(4)
Jeffrey L. Dangeau General Counsel and Secretary, Arkansas Western Gas 1,000(4)
Company
Terrence T. Darilek Senior Landman, Southwestern Energy Production 1,100(4)
Company
James H. Denney, Jr. Senior Geologist, Southwestern Energy Production 1,000(4)
Company
Jimmy R. Dewbre Land Manager, Southwestern Energy Production 4,500(4)
Company
Daniel J. Diebolt Manager, Marketing & Transportation, Southwestern 450(4)
Energy Services Company
Patric W. Dixon Manager, Gas Supply, Southwestern Energy Services 450(4)
Company
Terry M. England Division Operating Manager, Arkansas Western Gas 420(4)
Company
Ronald R. Foshee Senior Geologist, Southwestern Energy Production 1,000(4)
Company
John C. Gargani Manager, Economic Planning & Acquisitions, 2,000(4)
Southwestern Energy Production Company
Michael K. Garner Senior Manager, Procurement & Facility Services 420(4)
Ronnie R. Gilbreath District Production Engineer, Southwestern Energy 500(4)
Production Company
Patrick T. Gordon Senior Production Geologist, Southwestern Energy 1,590(4)
Production Company
Teresa L. Grant Senior Landman, Southwestern Energy Production 660(4)
Company
Sheila K. Green Manager, Application Services 420(4)
Ricky A. Gunter Vice President--Rates and Regulation and Assistant 1,000(4)
Secretary, Arkansas Western Gas Company
5
<PAGE>
Number of Shares
That May be
Selling Shareholder Position with the Company Offered Hereby
<S> <C> <C>
Michael Z. Hays Director, Pipeline Operations, Arkansas Western Gas 500(4)
Company
Dee W. Hency Vice President--Administration and Chief Information 3,500(4)
Officer
Mark A. Hill Senior Landman, Southwestern Energy Production 420(4)
Company
Mark A. Janik Senior Reservoir Engineer, Southwestern Energy 1,200(4)
Production Company
Carol S. Johnston Manager, Division Orders, Southwestern Energy 420(4)
Production Company
Dale J. Kardash District Engineer, Southwestern Energy Production 1,790(4)
Company
John R. Kehn, Jr. Vice President--Distribution Operations, Arkansas 675(4)
Western Gas Company
Robin A. Kisling Superintendent--Production, Southwestern Energy 240(4)
Production Company
Karl A. Knudson Senior Reservoir Engineer, Southwestern Energy 2,200(4)
Production Company
Richard J. Kurtz Gas Marketing Representative, Southwestern Energy 450(4)
Services Company
Bob J. Lamb Vice President--Community Development, Arkansas 1,200(4)
Western Gas Company
Steven K. McFarland Manager, Network Services 420(4)
Terry G. McMillin Safety/Health Environmental Coordinator, 420(4)
Southwestern Energy Production Company
Richard C. Merrill Staff Exploration Geologist, Southwestern Energy 1,750(4)
Production Company
James W. Mitchell Manager, Field Procurement Services, Southwestern 420(4)
Energy Production Company
Glenn M. Morgan Treasurer and Controller, Arkansas Western Gas 1,000(4)
Company
James L. Mullins, Jr. Director, Human Resources, Arkansas Western Gas 420(4)
Company
Michael E. Navolio Staff Geophysicist, Southwestern Energy Production 1,200(4)
Company
6
<PAGE>
Number of Shares
That May be
Selling Shareholder Position with the Company Offered Hereby
<S> <C> <C>
Freda R. O'Brien Staff Reservoir Engineer, Southwestern Energy 1,950(4)
Production Company
Robert C. Pace Staff Geologist, Southwestern Energy Production 2,200(4)
Company
Anita M. Parisi Manager, Application Services 420(4)
David L. Rader Manager, Accounting, Arkansas Western Gas 420(4)
Company
David L. Rolando Division Properties Manager, Southwestern Energy 420(4)
Production Company
Debra Rutan Senior Geologist, Southwestern Energy Production 1,000(4)
Company
George E. Schneider Manager, Transmission Operations, Arkansas Western 420(4)
Gas Company
Phillip R. Shelby Senior Production Geologist, Southwestern Energy 840(4)
Production Company
Bruce A. Smallwood Manager, Taxation 1,000(4)
Joe A. Stubblefield Exploitation and Drilling Manager, Southwestern 5,000(4)
Energy Production Company
Elsie C. Sullivan Staff Geologist, Southwestern Energy Production 2,200(4)
Company
Bradley D. Sylvester Investor Relations Coordinator 1,000(4)
John D. Thaeler SEECO Exploitation Manager, Southwestern Energy 900(4)
Production Company
Samuel G. Thompson Senior Landman, Southwestern Energy Production 1,000(4)
Company
James M. Tully Senior Drilling Engineer, Southwestern Energy 1,200(4)
Production Company
Ricardo Vasquez Staff Geologist, Southwestern Energy Production 1,600(4)
Company
Eric M. Vaughn Manager--Audit Services 420(4)
Matt B. Williams Senior Geologist, Southwestern Energy Production 1,800(4)
Company
Paul W. Williams Manager, Financial Reporting & Budgeting 1,000(4)
7
<PAGE>
Number of Shares
That May be
Selling Shareholder Position with the Company Offered Hereby
<S> <C> <C>
William J. Winkelmann Staff Geologist, Southwestern Energy Production 1,000(4)
Company
Daniel R. Zebrowski Staff Geophysicist, Southwestern Energy 2,200(4)
Production Company
</TABLE>
[FN]
(1) Represents shares of common stock which may be acquired upon the exercise
of options granted under the 1993 Stock Incentive Plan and shares of restricted
common stock issued under the 1993 Stock Incentive Plan.
(2) Includes 88,250 shares of common stock which may be acquired upon the
exercise of options granted under the 1993 Stock Incentive Plan, 7,750 shares of
restricted common stock issued under the 1993 Stock Incentive Plan, 100,000
shares of common stock which may be acquired upon the exercise of options
granted pursuant to a non-qualified stock option and limited stock appreciation
right agreement and 15,000 shares of restricted common stock issued pursuant to
a restricted stock agreement.
(3) Includes 28,000 shares of common stock which may be acquired upon the
exercise of options granted under the 1993 Stock Incentive Plan, 7,000 shares of
restricted common stock issued under the 1993 Stock Incentive Plan, 15,000
shares of common stock which may be acquired upon the exercise of options
granted pursuant to a non-qualified stock option and limited stock appreciation
right agreement and 1,820 shares of restricted common stock issued pursuant to a
restricted stock agreement.
(4) Represents shares of restricted common stock issued pursuant to restricted
stock agreements.
</FN>
PLAN OF DISTRIBUTION
The selling shareholders have not advised us of any specific plans for
the sale of the shares offered under this prospectus but, if and when such
shares are sold, it is anticipated that the shares will be sold from time to
time primarily in transactions on the New York Stock Exchange at the market
price then prevailing. Sales also may be made through negotiated transactions or
otherwise, at prices related to the prevailing market price or otherwise. If
shares are sold through brokers, the selling shareholders may pay customary
brokerage commissions and charges. The selling shareholders may effect these
transactions by selling shares to or through broker-dealers and such
broker-dealers may receive compensation in the form of discounts, concessions or
commissions from the selling shareholders and or the purchaser of the shares so
sold for whom such broker-dealers may act or to whom they may sell as principal
or both (which compensation, as to a particular broker-dealer, may be in excess
of customary commissions). Shares covered by this prospectus also may be sold
under Rule 144 or another exemption under the Securities Act rather than
pursuant to this prospectus.
In connection with the sale of shares, the selling shareholders and any
participating broker or dealer may be deemed to be "underwriters" within the
meaning of the Securities Act, and any profits on the sale of shares or
commissions they receive may be deemed to be underwriting discounts and
commissions under the Securities Act.
8
<PAGE>
There is no assurance that the selling shareholders will sell any or
all of the shares offered by them hereby.
EXPERTS
Our consolidated financial statements as of December 31, 1998, and for
each of the three years in the period ended December 31, 1998, included in our
Annual Report on Form 10-K for the year ended December 31, 1998, incorporated by
reference herein, have been audited by Arthur Andersen LLP, independent public
accountants, as indicated in their report with respect thereto and have been
incorporated by reference herein in reliance upon the authority of said firm as
experts in giving said report.
LEGAL MATTERS
The validity of the shares being offered hereby will be passed upon for
us by Conner & Winters, P.L.L.C., Fayetteville, Arkansas.
INDEMNIFICATION
The Arkansas Business Corporation Act provides that a corporation shall
have the power to indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action or proceeding
(other than an action by or in the right of the corporation) by reason of the
fact that he is or was a director, officer, employee or agent of the
corporation, against expenses, judgments, fines and amounts paid in settlements
reasonably incurred by him in connection with such action or proceeding if he
acted in good faith in a manner reasonably believed to be in or not opposed to
the best interests of the corporation. In addition, a corporation shall have the
power to indemnify any person who was or is a party or is threatened to be made
a party to any threatened, pending or completed action or suit by or in the
right of the corporation to procure a judgment in its favor by reason of the
fact that he is or was a director, officer, employee or agent of the corporation
against expenses actually reasonably incurred by him in connection with the
defense or settlement of such action if he acted in good faith in a manner
reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made in respect of any
claim as to which such person shall have been adjudged to be liable for
negligence or misconduct unless and only to the extent the court in which such
action was brought shall determine that, despite the adjudication of liability,
but in view of all circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the court shall deem
proper.
Our bylaws provide that our officers and directors shall be indemnified
to the fullest extent permitted by law in connection with any actual or
threatened action or proceeding arising out of their service to us (including
service to a subsidiary of ours) or to any other organization at our request.
We have entered into indemnification agreements with each of our
directors and officers pursuant to which we have has agreed to indemnify our
directors and officers against liabilities
9
<PAGE>
and litigation costs resulting from their service to us. We also maintain
directors' and officers' liability insurance.
Our 1993 Stock Incentive Plan provides:
No member of the Committee shall be liable for any action, omission or
determination relating to the Plan, and the Company shall indemnify and
hold harmless each member of the Committee and each other director or
employee of the Company to whom any duty or power relating to the
administration or interpretation of the Plan has been delegated against
any cost or expense (including counsel fees) or liability (including
any sum paid in settlement of a claim with the approval of the
Committee) arising out of any action, omission or determination
relating to the Plan, unless, in either case, such action, omission or
determination was taken or made by such member, director or employee in
bad faith and without reasonable belief that it was in the best
interests of the Company.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers or controlling persons pursuant
to the foregoing provisions, we have been informed that, in the opinion of the
SEC, such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than our payment of expenses
incurred or paid by one of our directors, officers or controlling persons in the
successful defense of any action, suit or proceeding) is asserted by a director,
officer or controlling person in connection with the securities being
registered, we will, unless in the opinion of our counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by us is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
10
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents which have been filed by Southwestern Energy
Company (the "Company") with the Securities and Exchange Commission (the
"Commission") are incorporated by reference in this Registration Statement:
(1) The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1998;
(2) The Company's Quarterly Reports on Form 10-Q for the quarters
ended March 31, 1999, June 30, 1999, and September 30, 1999;
(3) The Company's Current Reports on Form 8-K filed with the
Commission on April 8, 1999, and October 20, 1999;
(4) The description of the Company's common stock contained in the
Registration Statement on Form 8-A dated October 23, 1981, as
updated by the Company's Current Report on Form 8-K dated July
8, 1993; and
(5) The description of the common stock purchase rights contained
in Amendment No. 1 to the Company's Registration Statement on
Form 8-A dated April 26, 1999.
In addition, all documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), prior to the filing of a post-effective
amendment which indicates that all securities offered hereby have been sold or
which deregisters all securities offered hereby then remaining unsold, shall be
deemed to be incorporated by reference in this Registration Statement and to be
a part hereof from their respective dates of filing. Any statement contained in
this Registration Statement, or in a document incorporated by reference herein,
shall be deemed to be modified or superseded for purposes of this Registration
Statement to the extent that a statement contained in any other subsequently
filed incorporated document modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Registration Statement.
Item 4. Description of Securities.
Not applicable.
II-1
<PAGE>
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Section 4-27-850 of the Arkansas Code Annotated provides that the
Company shall have the power to indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
proceeding (other than an action by or in the right of the Company) by reason of
the fact that he is or was a director, officer, employee or agent of the
Company, against expenses, judgments, fines and amounts paid in settlements
reasonably incurred by him in connection with such action or proceeding if he
acted in good faith in a manner reasonably believed to be in or not opposed to
the best interests of the Company. In addition, the Company shall have the power
to indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action or suit by or in the right
of the Company to procure a judgment in its favor by reason of the fact that he
is or was a director, officer, employee or agent of the Company against expenses
actually reasonably incurred by him in connection with the defense or settlement
of such action if he acted in good faith in a manner reasonably believed to be
in or not opposed to the best interests of the Company and except that no
indemnification shall be made in respect of any claim as to which such person
shall have been adjudged to be liable for negligence or misconduct unless and
only to the extent the court in which such action was brought shall determine
that, despite the adjudication of liability, but in view of all circumstances of
the case, such person is fairly and reasonably entitled to indemnity for such
expenses which the court shall deem proper.
Article VII, Section 6, of the Company's Bylaws provides that the
Company's officers and directors shall be indemnified to the fullest extent
permitted by law in connection with any actual or threatened action or
proceeding arising out of their service to the Company (including service to a
subsidiary of the Company) or to any other organization at the Company's
request.
The Company has entered into indemnification agreements with each of
its directors and officers under which the Company has agreed to indemnify its
directors and officers against liabilities and litigation costs resulting from
their service to the Company. The Company also maintains directors' and
officers' liability insurance.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or controlling persons of the
Company pursuant to the foregoing provisions, the Company has been informed
that, in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Company of expenses
incurred or paid by a director, officer or controlling person of the Company 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 Company will, unless in the opinion of its counsel the matter
has been settled by controlling
II-2
<PAGE>
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
Item 7. Exemption from Registration Claimed.
Prior to the effectiveness of the initial filing of this Registration
Statement, the Company awarded to certain employees (i) options to purchase
147,000 shares of its common stock pursuant to stock option agreements and (ii)
59,785 shares of its common stock pursuant to restricted stock agreements.
Registration of the shares of common stock was not required because the awards
of the options and shares did not constitute a "sale" for purposes of the
Securities Act as no cash or other tangible or definable consideration was paid
for such awards. See SEC Release 33-6188, SEC Docket Volume 19, No. 7 at 482
(February 19, 1980). In addition, such transactions did not involve a public
offering and were therefore exempt pursuant to the provisions of Section 4(2) of
the Securities Act.
Item 8. Exhibits.
Exhibit Number Description
4.1 Southwestern Energy Company 1993 Stock Incentive Plan,
as amended and restated as of February 18, 1998
(incorporated by reference herein by reference to
Exhibit 10.2(d) to the Company's Annual Report on Form
10-K for the year ended December 31, 1998).
4.2 Form of Restricted Stock Agreement between Southwestern
Energy Company and employees awarded shares of
restricted stock.
4.3 Form of Non-qualified Stock Option and Limited Stock
Appreciation Right Certificate between Southwestern
Energy Company and employees granted stock options.
5.1 Opinion of Conner & Winters, P.L.L.C.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Conner & Winters, P.L.L.C. (contained in the
opinion included in Exhibit 5.1).
24 Power of Attorney (included on the signature page to
this Registration Statement).
II-3
<PAGE>
Item 9. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made of the securities registered hereby, 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 this Registration
Statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in this
Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected
in the form of a prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in the volume
and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of
Registration Fee" table in this Registration Statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed
in this Registration Statement or any material change to such
information in this Registration Statement;
provided, however, that the undertakings set forth in paragraphs
(a)(1)(i) and (a)(1)(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 the registrant 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.
(b) The undersigned Registrant hereby further undertakes that, for
purposes of determining any liability under the Securities Act, each filing of
the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each
II-4
<PAGE>
filing of an employee benefit plan's annual report pursuant to Section 15(d) of
the Exchange Act) that is incorporated by reference in this 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.
(h) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that, in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant 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 Registrant will, unless in
the opinion of its 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 Securities
Act and will be governed by the final adjudication of such issue.
II-5
<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 all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Fayetteville, State of Arkansas on the 4th day of
February, 2000.
SOUTHWESTERN ENERGY COMPANY
By: /s/ Harold M. Korell
Harold M. Korell
President and
Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature
appears below constitutes and appoints Harold M. Korell and Greg D. Kerley, each
of them, his true and lawful attorneys-in-fact and agents with full power of
substitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with all exhibits thereto,
and all documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in and about the premises, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or his or their substitutes, may lawfully do or
cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/s/ Harold M. Korell President, Chief Executive February 4, 2000
Harold M. Korell Officer and Director
(Principal Executive Officer)
/s/ Greg D. Kerley Executive Vice President and February 4, 2000
Greg D. Kerley Chief Financial Officer
(Principal Financial Officer)
/s/Stanley T. Wilson Controller and Chief Accounting February 4, 2000
Stanley T. Wilson Officer (Principal Accounting Officer)
II-6
<PAGE>
Signature Title Date
<S> <C> <C>
/s/ Lewis E. Epley, Jr. Director February 4, 2000
Lewis E. Epley, Jr.
/s/ John Paul Hammerschmidt Director February 4, 2000
John Paul Hammerschmidt
/s/ Robert L. Howard Director February 4, 2000
Robert L. Howard
/s/ Kenneth R. Mourton Director February 4, 2000
Kenneth R. Mourton
/s/ Charles E. Scharlau Director and Chairman February 4, 2000
Charles E. Scharlau
</TABLE>
II-7
<PAGE>
EXHIBIT INDEX
Exhibit Number Description
4.1 Southwestern Energy Company 1993 Stock Incentive Plan,
as amended and restated as of February 18, 1998
(incorporated by reference herein by reference to
Exhibit 10.2 (d) to the Company's Annual Report on
Form 10-K for the year ended December 31, 1998).
4.2 Form of Restricted Stock Agreement between
Southwestern Energy Company and employees awarded
shares of restricted stock.
4.3 Form of Non-qualified Stock Option and Limited Stock
Appreciation Right Certificate between Southwestern
Energy Company and employees granted stock options.
5.1 Opinion of Conner & Winters, P.L.L.C.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Conner & Winters, P.L.L.C. (contained in
the opinion included in Exhibit 5.1).
24 Power of Attorney (included on the signature page to
this Registration Statement).
RESTRICTED STOCK AGREEMENT
THIS AGREEMENT, made as of this ____ day of _________________, ____, by
and between Southwestern Energy Company, a corporation (the "Company") and
_______________________ (the "Grantee").
WITNESSETH:
WHEREAS, the Grantee is now serving as an officer or key employee of
the Company and the Company desires to afford the Grantee the opportunity to
acquire, or enlarge, the Grantee's stock ownership in the Company so that the
Grantee may have a direct proprietary interest in the Company's success;
NOW, THEREFORE, in consideration of the covenants and agreement herein
contained, the parties hereto hereby agree as follows:
1. Grant of Restricted Stock
The Company hereby grants to the Grantee, subject to the terms and
conditions herein set forth, the right to receive from the Company _____ shares
of Restricted Stock ($.10 par value) of the Company to be issued from treasury
shares separate and apart from the Southwestern Energy Company 1993 Stock
Incentive Plan.
2. Definitions
a. "Change in Control" shall mean the occurrence of any of the
following:
(i) any "person" (as such term is used in Sections
13(d) and 14(d) of the Exchange Act, an "Acquiring Person")
becomes the "beneficial owner" (as such term is defined in
Rule 13d-3 promulgated under the Exchange Act), directly or
indirectly, of securities of the Company representing 20% or
more of the combined voting power of the Company's then
outstanding securities, excluding any employee benefit plan
sponsored or maintained by the Company (or any trustee of such
plan acting as trustee);
(ii) the Company's stockholders approve an agreement
to merge or consolidate the Company with another corporation
(other than a corporation 50% or more of which is controlled
by, or is under common control with, the Company);
<PAGE>
(iii) any individual who is nominated by the Board of
Directors for election to the Board of Directors on any date
fails to be so elected as a direct or indirect result of any
proxy fight or contested election for positions on the Board;
(iv) a "change in control" of the Company of a nature
that would be required to be reported in response to Item 6(e)
of Schedule 14A of Regulation 14A promulgated under the
Exchange Act occurs; or
(v) a majority of the Board determines in its sole
and absolute discretion that there has been a Change in
Control of the Company or that there will be a Change in
Control of the Company upon the occurrence of certain
specified events and such events occur.
b. "Committee" shall mean the Compensation Committee of the Board
of Directors or such other committee as the Board of Directors
shall appoint from time to time to administer the Plan;
provided, however, that the Committee shall at all times
consist of two or more persons, each of whom shall be a
"disinterested person" within the meaning of Rule 16b-3
promulgated under Section 16 of the Exchange Act.
c. "Company" shall mean Southwestern Energy Company, an Arkansas
corporation, and each of its Subsidiaries.
d. "Company Stock" shall mean the common stock of the Company.
e. "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
f. "Issue Date" shall mean the date established by the Committee
on which certificates representing shares of Restricted Stock
shall be issued by the Company pursuant to the terms hereof.
g. "Person" shall mean a "person," as such term is used in
Sections 13(d) and 14(d) of the Exchange Act.
h. "Restricted Stock" shall mean a share of Company Stock which
is granted pursuant to the terms hereof and which is subject
to the restrictions set forth herein for so long as such
restrictions continue to apply to such share.
i. "Securities Act" shall mean the Securities Act of 1933, as
amended.
j. "Vesting Date" shall mean the date established by the
Committee on which a share of Restricted Stock or Phantom
Stock may vest.
2
<PAGE>
3. Term and Restrictions
(a) Issue Date and Vesting Date
The Issue Date of the Restricted Stock granted hereunder shall be the
effective date of this agreement. Except as provided in Sections 3(c) and 3(f),
stock certificates representing the shares of Restricted Stock granted hereunder
shall be issued in accordance with Section 3(d) hereof. Such shares shall vest
ratably over a three year period from the date hereof (the "Vesting Dates").
Except as provided in Sections 3(c) and 3(f), and provided that all conditions
to the vesting of a share of Restricted Stock imposed pursuant to Section 3(b)
hereof are satisfied, upon the occurrence of the Vesting Date with respect to a
share of Restricted Stock, such share shall vest and the restrictions of Section
3(c) hereof shall cease to apply to such share.
(b) Conditions to Vesting
Except for continuation of employment with the Company as provided in
Section 3(f) hereof, there are no conditions to the vesting of the shares of
Restricted Stock granted hereunder.
(c) Restrictions on Transfer Prior to Vesting
Prior to the vesting of a share of Restricted Stock, no transfer of
Grantee's rights with respect to such share, whether voluntary or involuntary,
by operation of law or otherwise, shall vest the transferee with any interest or
right in or with respect to such share, but immediately upon any attempt to
transfer such rights, such share, and all of the rights related thereto, shall
be forfeited by the Grantee, and the transfer shall be of no force or effect.
(d) Issuance of Certificates
(1) Except as provided in Sections 3(c) or 3(f) hereof, reasonably
promptly after the Issue Date with respect to shares of Restricted Stock, the
Company shall cause to be issued a stock certificate, registered in the name of
the Grantee to whom such shares were granted, evidencing such shares; provided,
that the Company shall not cause to be issued such a stock certificate unless it
has received a stock power duly endorsed in blank with respect to such shares.
Each such stock certificates shall bear the following legend:
The transferability of this certificate and the shares of
stock represented hereby are subject to the restrictions,
terms and conditions (including forfeiture provisions and
restrictions against transfer) contained in an Agreement
entered into between the registered owner of such shares and
Southwestern Energy Company. A copy of the Agreement is on
file in the office of the Secretary of Southwestern Energy
Company, 1083 Sain Street, Fayetteville, Arkansas 72703.
3
<PAGE>
Such legend shall not be removed from the certificate evidencing such shares
until such shares vest pursuant to the terms hereof.
(2) Each certificate issued pursuant to Section 3(d)(1) hereof,
together with the stock powers relating to the shares of Restricted Stock
evidenced by such certificate, shall be deposited by the Company with a
custodian designated by the Company. The Company shall cause such custodian to
issue to the Grantee a receipt evidencing the certificates held by it which are
registered in the name of the Grantee.
(e) Consequences Upon Vesting
Upon the vesting of a share of Restricted Stock pursuant to the terms
hereof, the restrictions of Section 3(c) hereof shall cease to apply to such
share. Reasonably promptly after a share of Restricted Stock vests pursuant to
the terms hereof, the Company shall cause to be issued and delivered to the
Grantee, a certificate evidencing such share, free of the legend set forth in
Section 3(d)(1) hereof, together with any other property of the Grantee held by
the custodian pursuant to Section 4(b) hereof.
(f) Effect of Termination of Employment
In the event that the employment of the Grantee with the Company shall
terminate for any reason prior to the vesting of shares of the Restricted Stock,
all shares of Restricted Stock granted to the Grantee hereunder which have not
vested as of the date of such termination shall immediately be forfeited.
(g) Effect of Change in Control
Upon the occurrence of a Change in Control, all shares of Restricted
Stock granted hereunder which have not theretofore vested, or been canceled or
forfeited pursuant to any provision hereof or of the Plan, shall immediately
vest.
4. Adjustment Upon Changes in Company Stock
(a) Outstanding Restricted Stock
Unless the Committee in its absolute discretion otherwise determines,
any securities or other property (including dividends paid in cash) received by
Grantee with respect to a share of Restricted Stock, the Issue Date with respect
to which occurs prior to such event, but which has not vested as of the date of
such event, as a result of any dividend, stock split, reverse stock split,
recapitalization, merger, consolidation, combination, exchange of shares or
otherwise will not vest until such share of Restricted Stock vests, and shall be
promptly deposited with the custodian
4
<PAGE>
designated pursuant to Paragraph 3(d)(2) hereof. The Committee has determined
that the right to receive cash dividends paid on the shares of Restricted Stock
shall vest on the Issue Date.
The Committee may, in its absolute discretion, adjust the grant of
shares of Restricted Stock made hereunder, provided the Issue Date has not
occurred as of the date of the occurrence of any of the following events, to
reflect any dividend, stock split, reverse stock split, recapitalization,
merger, consolidation, combination, exchange of shares or similar corporate
change as the Committee may deem appropriate to prevent the enlargement or
dilution of rights of Grantee under the grant.
(b) No Other Rights
Except as expressly provided herein, the Grantee shall have no rights
by reason of any subdivision or consolidation of shares of stock of any class,
the payment of any dividend, any increase or decrease in the number of shares of
stock of any class or any dissolution, liquidation, merger or consolidation of
the Company or any other corporation. Except as expressly provided herein, no
issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number of shares of Company
Stock subject to the Restricted Stock granted hereunder.
5. Rights as a Shareholder
The Grantee shall have no rights as a stockholder with respect to any
shares of Company Stock covered by or relating to the Restricted Stock granted
hereunder until the date of the issuance of a stock certificate with respect to
such shares. Except as otherwise expressly provided in Section 4 hereof, no
adjustment to the Restricted Stock shall be made for dividends or other rights
for which the record date occurs prior to the date such stock certificate is
issued.
6. No Special Employment Rights; No Right To Restricted Stock
Nothing contained herein shall confer upon Grantee any right with
respect to continuation of his employment by the Company or interfere in any way
with the right of the Company, subject to the terms of any separate employment
agreement to the contrary, at any time to terminate such employment or to
increase or decrease the compensation of Grantee from the rate in existence on
the date hereof. The grant of the Restricted Stock hereunder shall neither
require or prevent the granting of any subsequent Restricted Stock to Grantee or
any other person.
5
<PAGE>
7. Securities Matters
(a) The Company shall be under no obligation to effect the registration
pursuant to the Securities Act of any interests in the Plan or this Agreement or
any shares of Company Stock to be issued hereunder or to effect similar
compliance under any state laws. Notwithstanding anything herein to the
contrary, the Company shall not be obligated to cause to be issued or delivered
any certificates evidencing shares of Company Stock pursuant to this Agreement
unless and until the Company is advised by its counsel that the issuance and
delivery of such certificates is in compliance with all applicable laws,
regulations of governmental authority and the requirements of the New York Stock
Exchange and any other securities exchange on which shares of Company Stock are
traded. The Committee may require, as a condition of the issuance and delivery
of certificates evidencing shares of Company Stock pursuant to the terms hereof,
that the recipient of shares make such agreements and representations, and that
such certificates bear such legends as the Committee, in its sole discretion,
deems necessary or desirable.
8. Withholding Taxes
(a) Cash Remittance
Whenever shares of Company Stock are to be issued upon the occurrence
of the Issue Date or the Vesting Date and whenever dividends are paid in respect
of non-vested shares of restricted stock, the Company shall have the right to
require the Grantee to remit to the Company in cash an amount sufficient to
satisfy federal, state and local withholding tax requirements, if any,
attributable to such occurrence prior to the delivery of any certificate or
certificates for such shares.
(b) Stock Remittance
Subject to Section 8(d) hereof, at the election of the Grantee, subject
to the approval of the Committee, when shares of Company Stock are to be issued
upon the occurrence of the Issue Date or the Vesting Date, in lieu of the
remittance required by Section 8(a) hereof, the Grantee may tender to the
Company a number of shares of Company Stock determined by such Grantee, the Fair
Market Value of which at the tender date the Committee determines to be
sufficient to satisfy the federal, state and local withholding tax requirements,
if any, attributable to such exercise and not greater than the Grantee's
estimated total federal, state and local tax obligations associated with such
exercise.
(c) Stock Withholding
The Company shall have the right, when shares of Company Stock are to
be issued upon the occurrence of the Issue Date or the Vesting Date, in lieu of
requiring the remittance required by Section 8(a) hereof, to withhold a number
of such shares, the Fair Market Value of which at
6
<PAGE>
the exercise date the Committee determines to be sufficient to satisfy the
federal, state and local withholding tax requirements, if any, attributable to
such occurrence and is not greater than the Grantee's estimated total federal,
state and local tax obligations associated with such exercise.
(d) Timing and Method of Elections
Notwithstanding any other provisions hereof, if the Grantee is subject
to Section 16(b) of the Exchange Act, the Grantee may not make the election
described in Section 8(b) hereof prior to the expiration of six months after the
date of this Agreement, except in the event of the death or Disability of the
Grantee. If the Grantee is subject to Section 16(b) of the Exchange Act, the
Grantee may not make such election other than (i) during the 10-day window
period beginning on the third business day following the date of release for
publication of the Company's quarterly and annual summary statements of sales
and earnings and ending on the twelfth business day following such date or (ii)
at least six months prior to the date such election is made. Such election shall
be irrevocable and shall be made by the delivery to the Company's principal
office, to the attention of its Secretary, of a written notice signed by the
Grantee.
9. Transfers Upon Death
No transfer by will or the laws of descent and distribution of the
Restricted Stock granted hereunder, shall be effective to bind the Company
unless the Committee shall have been furnished with (a) written notice thereof
and with a copy of the will and/or such evidence as the Committee may deem
necessary to establish the validity of the transfer and (b) an agreement by the
transferee to comply with all the terms and conditions of this Agreement that
are or would have been applicable to the Grantee and to be bound by the
acknowledgments made by the Grantee in connection with the grant of the
Restricted Stock.
10. Failure to Comply
In addition to the remedies of the Company elsewhere provided for
herein, failure by the Grantee (or beneficiary) to comply with any of the terms
and conditions of this Agreement, unless such failure is remedied by the Grantee
(or beneficiary) within ten days after having been notified of such failure by
the Committee, shall be grounds for the cancellation and forfeiture of the
Restricted Stock, in whole or in part as the Committee, in its absolute
discretion, may determine.
11. Applicable Law
Except to the extent preempted by any applicable federal law, this
Agreement will be construed and administered in accordance with the laws of the
State of Arkansas, without reference to the principles of conflicts of law.
7
<PAGE>
12. Notices
Any notice hereunder to the Company shall be addressed to it at its
office, P. O. Box 1408, Fayetteville, AR 72702-1408: Attention: Secretary,
and any notice hereunder to Grantee shall be addressed to the Grantee
at __________________________________________. Either party may designate at
any time hereafter in writing some other address.
IN WITNESS WHEREOF, Southwestern Energy Company has caused this
Agreement to be executed by its undersigned duly authorized officer as of the
____ day of ____________, ____.
SOUTHWESTERN ENERGY COMPANY
ATTEST: (Seal) By: _____________________________________
President and Chief Executive Officer
By: _______________________________
Senior Vice President
_____________________________________
(Grantee)
8
SOUTHWESTERN ENERGY COMPANY
NON-QUALIFIED STOCK OPTION
AND
LIMITED STOCK APPRECIATION RIGHT CERTIFICATE
(Not Transferable)
THIS CERTIFIES, that SOUTHWESTERN ENERGY COMPANY, an Arkansas
corporation (the "Company"), has, as of the ___ day of __________, ____, granted
to _____________________________ (the "Grantee"), (1) a Non-Qualified Stock
Option to purchase _____ shares (the "Optioned Shares") of the Company's Common
Stock ($.10 par value) ("Company Stock") and (2) a Limited Stock Appreciation
Right (the "LSAR") with respect to _____ shares of Company Stock (the "LSAR
Shares"), in each case, on the terms and conditions of the NQO/LSAR Terms and
Conditions attached hereto and made a part hereof ("T & C").
This Non-Qualified Stock Option and LSAR is granted separate and
apart from the Southwestern Energy Company 1993 Stock Incentive Plan, and any
shares issued to Grantee upon exercise of this option shall be issued from
treasury shares.
This Non-Qualified Stock Option and LSAR shall be exercisable
only in accordance with the provisions of this Certificate and the T & C.
The exercise price of the Optioned Shares and LSAR Shares shall
be $_____ per share.
The exercise of this LSAR with respect to a number of LSAR
Shares shall cause the immediate and automatic cancellation of this
Non-Qualified Stock Option with respect to an equal number of Optioned Shares.
The exercise of this Non-Qualified Stock Option, or the cancellation,
termination or expiration of this Non-Qualified Stock Option (other than
pursuant to Section 4(b)(2) of the T & C), with respect to a number of Optioned
Shares, shall cause the cancellation of this LSAR with respect to an equal
number of LSAR Shares.
This Non-Qualified Stock Option and LSAR is not transferable
except by will or the laws of descent and distribution.
This Non-Qualified Stock Option and LSAR shall be exercisable in
whole or in part; provided, that no partial exercise shall be for an aggregate
exercise price of less than $1,000. The partial exercise of this Non-Qualified
Stock Option or LSAR shall not cause the expiration, termination or cancellation
of the remaining portion hereof.
This Non-Qualified Stock Option and LSAR shall be exercised by
delivering notice to the Company's principal office, to the attention of its
Secretary, no less than one
<PAGE>
business day in advanc of the effective date of the proposed exercise. Such
notice shall be accompanied by this Certificate, shall specify the number of
Optioned Shares and/or LSAR Shares with respect to which this Non-Qualified
Stock Option and LSAR is being exercised and the effective date of the proposed
exercise and shall be signed by the Grantee. The Grantee may withdraw such
notice at any time prior to the close of business on the business day
immediately preceding the effective date of the proposed exercise.
Payment for Optioned Shares purchased upon the exercise of this
Non-Qualified Stock Option shall be made on the effective date of such exercise
in accordance with the T & C.
THIS NON-QUALIFIED STOCK OPTION SHALL FIRST BECOME EXERCISABLE
WITH RESPECT TO THE FOLLOWING PERCENTAGE OF THE TOTAL SHARES SUBJECT HERETO ON
THE FOLLOWING DATES:
======================================= =======================================
First Date on Which Such Percentage
Percentage of Total Shares of Total Shares Becomes Exercisable
======================================= =======================================
======================================= =======================================
======================================= =======================================
======================================= =======================================
THIS NON-QUALIFIED STOCK OPTION SHALL BECOME FULLY VESTED AT THE
EARLIER OF ____________ ____, ____ OR UPON GRANTEE'S RETIREMENT PROVIDED GRANTEE
HAS REACHED NORMAL RETIREMENT AGE (SIXTY-FIVE (65)), AS DEFINED IN THE
SOUTHWESTERN ENERGY COMPANY PENSION PLAN. PROVIDED, HOWEVER, UPON THE OCCURRENCE
OF A CHANGE IN CONTROL, IF AND TO THE EXTENT IT STILL IS OUTSTANDING, THIS
NON-QUALIFIED STOCK OPTION SHALL BECOME FULLY AND IMMEDIATELY EXERCISABLE AND
SHALL REMAIN EXERCISABLE UNTIL ITS EXPIRATION, TERMINATION OR CANCELLATION
PURSUANT TO THE T & C.
THIS LSAR SHALL BE EXERCISABLE ONLY DURING THE PERIOD COMMENCING
ON THE FIRST DAY FOLLOWING THE OCCURRENCE OF A CHANGE IN CONTROL AND TERMINATING
ON THE EXPIRATION OF SIXTY DAYS AFTER SUCH DATE; PROVIDED, THAT IF GRANTEE IS OR
MAY BE SUBJECT TO THE PROVISIONS OF SECTION 16(b) OF THE EXCHANGE ACT AND AN
LSAR BECOMES EXERCISABLE PRIOR TO THE EXPIRATION OF SIX MONTHS FOLLOWING THE
DATE ON WHICH IT IS GRANTED, THEN THE
2
<PAGE>
LSAR SHALL ALSO BE EXERCISABLE DURING THE PERIOD COMMENCING ON THE FIRST DAY
IMMEDIATELY FOLLOWING THE EXPIRATION OF SUCH SIX MONTH PERIOD AND TERMINATING ON
THE EXPIRATION OF SIXTY DAYS FOLLOWING SUCH DATE.
THIS NON-QUALIFIED STOCK OPTION AND LSAR SHALL EXPIRE AND BE
VOID AND SHALL NOT BE EXERCISABLE AFTER THE EXPIRATION OF TEN (10) YEARS FROM
THE DATE AS OF WHICH IT WAS GRANTED AND MAY BE EXERCISED ONLY IN THE MANNER
PROVIDED IN THE T & C. THIS NON-QUALIFIED STOCK OPTION AND LSAR SHALL BE SUBJECT
TO EARLIER TERMINATION, EXPIRATION OR CANCELLATION AS PROVIDED IN THE T & C.
IN WITNESS WHEREOF, the Company has issued this Non-Qualified
Stock Option and Limited Stock Appreciation Right Certificate by its undersigned
duly authorized officer as of the ____ day of ___________, ____.
SOUTHWESTERN ENERGY COMPANY
ATTEST: (Seal) By: _____________________________________
President and Chief Executive Officer
By: _______________________________
Senior Vice President
_____________________________________
(Grantee)
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NQO/LSAR TERMS AND CONDITIONS
1. Definitions
As used herein, the following definitions apply to the terms indicated
below:
(a) "Cause," when used in connection with the termination of
the Grantee's employment with the Company, shall mean the termination
of the Grantee's employment by the Company on account of (i) the
willful and continued failure by the Grantee substantially to perform
his duties and obligations to the Company (other than any such failure
resulting from his incapacity due to physical or mental illness) or
(ii) the willful engaging by the Grantee in misconduct which is
materially injurious to the Company. For purposes of this Section 1(a),
no act, or failure to act, on a Grantee's part shall be considered
"willful" unless done, or omitted to be done, by the Grantee in bad
faith and without reasonable belief that his action or omission was in
the best interests of the Company.
(b) "Change in Control" shall mean the occurrence of any of
the following:
(i) any "person" (as such term is used in Sections
13(d) and 14(d) of the Exchange Act, and "Acquiring Person")
becomes the "beneficial owner" (as such term is defined in
Rule 13d-3 promulgated under the Exchange Act), directly or
indirectly, of securities of the Company representing 20% or
more of the combined voting power of the Company's then
outstanding securities, excluding any employee benefit plan
sponsored or maintained by the Company (or any trustee of such
plan acting as trustee);
(ii) the Company's stockholders approve an agreement
to merge or consolidate the Company with another corporation
(other than a corporation 50% or more of which is controlled
by, or is under common control with, the Company);
(iii) any individual who is nominated by the Board of
Directors for election to the Board of Directors on any date
fails to be so elected as a direct or indirect result of any
proxy fight or contested election for positions on the Board;
(iv) a "change in control" of the Company of a nature
that would be required to be reported in response to Item 6(e)
of Schedule 14A of Regulation 14A promulgated under the
Exchange Act occurs; or
(v) a majority of the Board determines in its sole
and absolute discretion that there has been a Change in
Control of the Company or that there will be a Change in
Control of the Company upon the occurrence of certain
specified events and such events occur.
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(c) "Code" shall mean the Internal Revenue Code of 1986.
(d) "Committee" shall mean the Compensation Committee of the
Board of Directors or such other committee as the Board of Directors
shall appoint from time to time to administer this agreement provided,
however, that the Committee shall at all times consist of two or more
persons, each of whom shall be a "disinterested person" within the
meaning of Rule 16b-3 promulgated under Section 16 of the Exchange Act.
(e) "Company" shall mean Southwestern Energy Company, an
Arkansas corporation, and each of its Subsidiaries.
(f) "Company Stock" shall mean the common stock of the
Company.
(g) "Disability" shall mean any physical or mental condition
that would qualify a participant for a disability benefit under the
long-term disability plan maintained by the Company and applicable to
him.
(h) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
(i) the "Fair Market Value" of a share of Company Stock with
respect to any day shall be (i) the closing sales price on the
immediately preceding business day of a share of Company Stock as
reported on the principal securities exchange on which shares of
Company Stock are then listed or admitted to trading or (ii) if not so
reported, the average of the closing bid and ask prices on the
immediately preceding business day as reported on the National
Association of Securities Dealers Automated Quotation System of (iii)
if not so reported, as furnished by any member of the National
Association of Securities Dealers, Inc. selected by the committee. In
the event that the price of a share of Company Stock shall not be so
reported, the Fair Market Value of a share of Company Stock shall be
determined by the Committee in its absolute discretion.
(j) "Incentive Stock Option" shall mean an Option that is an
"incentive stock option" within the meaning of Section 422 of the Code.
(k) "LSAR" shall mean a limited stock appreciation right that
is granted pursuant to the provisions of Section 4 hereof and which
related to an Option. Each LSAR shall be exercisable only upon the
occurrence of a Change in Control and only in the alternative to the
exercise of its related Option.
(l) "Non-Qualified Stock Option" shall mean an Option that is
not an Incentive Stock Option.
(m) "Option" shall mean an option to purchase shares of
Company Stock granted pursuant to Section 3 hereof.
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(n) "Person" shall mean a "person," as such term is used in
sections 13(d) and 14(d) of the Exchange Act.
(o) "Securities Act" shall mean the Securities Act of 1933, as
amended.
(p) "Subsidiary" shall mean any corporation in which, at the
time of reference, the Company owns, directly or indirectly, stock
comprising more than fifty percent of the total combined voting power
of all classes of stock of such corporation.
2. Administration
The Committee shall have full authority to administer this agreement,
including authority to interpret and construe any provision of this agreement.
Decisions of the committee shall be final and binding on all parties.
The Committee may, in its absolute discretion, without amendment to
this agreement, accelerate the date on which any Option granted hereunder
becomes exercisable or otherwise adjust any of the terms of such Option.
3. Options
(a) Term and Exercise of Options
(1) Each Option shall be exercisable in whole or in part; provided,
that no partial exercise of an Option shall be for an aggregate exercise price
of less than $1,000. The partial exercise of an Option shall not cause the
expiration, termination or cancellation of the remaining portion thereof. Upon
the partial exercise of an Option, the agreements evidencing such Option and any
related LSARs, marked with such notations as the Committee may deem appropriate
to evidence such partial exercise, shall be returned to the Grantee together
with the delivery of the certificates described in Section 3(a)(4) hereof.
(2) An Option shall be exercised by delivering notice to the Company's
principal office, to the attention of its Secretary, no less than one business
day in advance of the effective date of the proposed exercise. Such notice shall
be accompanied by the agreements evidencing the Option and any related LSARs,
shall specify the number of shares of Company Stock with respect to which the
Option is being exercised and the effective date of the proposed exercise and
shall be signed by the Grantee. The Grantee may withdraw such notice at any time
prior to the close of business on the business day immediately preceding the
effective date of the proposed exercise, in which case such agreements shall be
returned to him. Payment for shares of Company Stock purchased upon the exercise
of an Option shall be made on the effective date of such exercise either (i) in
cash, by certified check, bank cashier's check or wire transfer or (ii) subject
to the approval of the committee, in shares of Company Stock owned by the
Participant and valued at their Fair Market Value on the effective date of such
exercise, or partly in shares of Company
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Stock with the balance in cash, by certified check, bank cashier's check or wire
transfer. Any payment in shares of Company Stock shall be effected by the
delivery of such shares to the Secretary of the Company, duly endorsed in blank
or accompanied by stock powers duly executed in blank, together with any other
documents and evidences as the Secretary of the Company shall require from time
to time.
(3) During the lifetime of Grantee, each Option granted to him shall be
exercisable only by him. No Option shall be assignable or transferable otherwise
than by will or by the laws off descent and distribution, nor shall any option
be permitted to be pledged in any manner.
(4) Certificates for shares of Company Stock purchased upon the
exercise of an Option shall be issued in the name of Grantee or his beneficiary,
as the case may be, and delivered to the Grantee or his beneficiary, as the case
may be, as soon as practicable following the effective date on which the Option
is exercised.
(b) Effect of Termination of Employment
(1) In the event that the employment of Grantee with the Company shall
terminate for any reason other than Cause, Disability or death (I) Options
granted to such Grantee, to the extent that they were exercisable at the time of
such termination, shall remain exercisable until the expiration of three months
after such termination, on which date they shall expire, and (ii) Options
granted to such Grantee, to the extent that they were not exercisable at the
time of such termination, shall expire at the close of business on the date of
such termination; provided, however that no Option shall be exercisable after
the expiration of its term.
(2) In the event that the employment of Grantee with the Company shall
terminate on account of the Disability or death of the Grantee (i) Options
granted to Grantee, to the extent that they were exercisable at the time of such
termination, shall remain exercisable until the expiration of one year after
such termination, on which date they shall expire, and (ii) Options granted to
Grantee, to the extent that they were not exercisable at the time of such
termination, shall expire at the close of business on the date of such
termination; provided, however, that no Option shall be exercisable after the
expiration of its term.
(3) In the event of the termination of Grantee's employment for Cause,
all outstanding Options granted to Grantee shall expire at the commencement of
business on the date of such termination.
(c) Acceleration of Exercise Date Upon Change in Control
Upon the occurrence of a Change in Control, each Option granted
hereunder and outstanding at such time shall become fully and immediately
exercisable and shall remain exercisable until its expiration, termination or
cancellation pursuant to the terms hereof.
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4. Limited SARs
(a) Benefit Upon Exercise
(1) The exercise of an LSAR relating to a Non-Qualified Stock Option
with respect to any number of shares of Company Stock shall entitle Grantee to a
cash payment, for each such share, equal to the excess of (i) the greater of (A)
the highest price per share of Company Stock paid in the Change in Control in
connection with which such LSAR became exercisable and (B) the Fair Market Value
of a share of Company Stock on the date of such Change in Control over (ii) the
exercise price of the related Option. Such payment shall be made as soon as
practicable, but in no event later than the expiration of five business days
after the effective date of such exercise.
(b) Term and Exercise of LSARs
(1) An LSAR shall be exercisable only during the period commencing on
the first day following the occurrence of a Change in Control and terminating on
the expiration of sixty days after such date. Notwithstanding the preceding
sentence of this Section 4(b), in the event that an LSAR held by any Grantee who
is or may be subject to the provisions of Section 16(b) of the Exchange Act
becomes exercisable prior to the expiration of six months following the date on
which it is granted, then the LSAR shall also be exercisable during the period
commencing on the first day immediately following the expiration of such six
month period and terminating on the expiration of sixty days following such
date. Notwithstanding anything else herein, an LSAR may be exercised only if and
to the extent that the Option to which it relates is exercisable.
(2) The exercise of an LSAR with respect to a number of shares of
Company Stock shall cause the immediate and automatic cancellation of the Option
to which it relates with respect to an equal number of shares. the exercise of
an Option, or the cancellation, termination or expiration of an Option (other
than pursuant to this Paragraph (2)), with respect to a number of shares of
Company Stock, shall cause the cancellation of the LSAR related to it with
respect to an equal number of shares.
(3) Each LSAR shall be exercisable in whole or in part; provided, that
no partial exercise of an LSAR shall be for an aggregate exercise price of less
than $1,000. The partial exercise of an LSAR shall not cause the expiration,
termination or cancellation of the remaining portion thereof. Upon the partial
exercise of an LSAR, the agreements evidencing the LSAR and the related Option,
marked with such notations as the committee may deem appropriate to evidence
such partial exercise, shall be returned to the Grantee exercising such LSAR
together with the payment described in Paragraph 4(a)(1) hereof.
(4) During the lifetime of Grantee, each LSAR granted to him shall be
exercisable only by him. No LSAR shall be assignable or transferable otherwise
than by will or by the laws of descent and distribution and otherwise than
together with its related Option, nor shall any LSAR be permitted to be pledged
in any manner.
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(5) An LSAR shall be exercised by delivering notice to the Company's
principal office, to the attention of its Secretary, no less than one business
day in advance of the effective date of the proposed exercise. Such notice shall
be accompanied by the applicable agreements evidencing the LSAR and the related
Option, shall specify the number of shares of Company Stock with respect to
which the LSAR is being exercised and the effective date of the proposed
exercise and shall be signed by the Grantee. The Grantee may withdraw such
notice at any time prior to the close of business on the business day
immediately preceding the effective date of the proposed exercise, in which case
such agreement shall be returned to him.
5. Adjustment Upon Changes in Company Stock
(a) Outstanding Options and LSARs - Increase or Decrease in Issued
Shares Without Consideration
Subject to any required action by the shareholders of the Company, in
the event of any increase or decrease in the number of issued shares of Company
Stock resulting from a subdivision or consolidation of shares of Company Stock
or the payment of a stock dividend (but only on the shares of Company Stock), or
any other increase or decrease in the number of such shares effected without
receipt of consideration by the Company, the Committee shall proportionally
adjust the number of shares of Company Stock subject to each outstanding Option
and LSAR, and the exercise price per share of Company Stock of each such Option
and LSAR.
(b) Outstanding Options and LSARs - Certain Mergers
Subject to any required action by the shareholders of the Company, in
the event that the Company shall be the surviving corporation in any merger or
consolidation (except a merger or consolidation as a result of which the holders
of shares of Company Stock receive securities of another corporation), each
Option and LSAR outstanding on the date of such merger or consolidation shall
pertain to and apply to the securities which a holder of the number of shares of
Company Stock subject to such Option and LSAR would have received in such merger
or consolidation.
(c) Outstanding Options and LSARs - Certain Other Transactions
In the event of (i) a dissolution or liquidation of the Company, (ii) a
sale of all or substantially all of the Company's assets, (iii) a merger or
consolidation involving the company in which the Company is not the surviving
corporation or (iv) a merger or consolidation involving the Company in which the
Company is the surviving corporation but the holders of shares of Company Stock
receive securities of another corporation and/or other property, including cash,
the Committee shall, in its absolute discretion, have the power to:
(i) cancel, effective immediately prior to the occurrence of
such event, each Option (including each LSAR related thereto)
outstanding immediately prior to such event (whether or not then
exercisable), and, in full consideration of such cancellation, pay to
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Grantee an amount in cash, for each share of Company Stock subject to
such Option equal to the excess of (A) the value, as determined by the
committee in its absolute discretion, of the property (including cash)
received by the holder of a share of Company Stock as a result of such
event over (B) the exercise price of such Option; or
(ii) provide for the exchange of each Option (including any
related LSAR) outstanding immediately prior to such event (whether or
not then exercisable) for an option on or stock appreciation right with
respect to, as appropriate, some or all of the property for which such
Option is exchanged and, incident thereto, make an equitable adjustment
as determined by the Committee in its absolute discretion in the
exercise price of the option or stock appreciation right, or the number
of shares or amount of property subject to the option or stock
appreciation right or, if appropriate, provide for a cash payment to
Grantee in partial consideration for the exchange of the Option.
(d) Outstanding Options and LSARs - Other Changes
In the event of any change in the capitalization of the Company or a
corporate change other than those specifically referred to in Section 5(a), (b)
or (c) hereof, the Committee may, in its absolute discretion, make such
adjustments in the number and class of shares subject to Options and LSARs
outstanding on the date on which such change occurs and in the per-share
exercise price of each such Option and LSAR, as the Committee may consider
appropriate to prevent dilution or enlargement of rights.
(e) No Other Rights
Except as expressly provided herein, Grantee shall have any rights by
reason of any subdivision or consolidation of shares of stock of any class, the
payment of any dividend, any increase or decrease in the number of shares of
stock of any class or any dissolution, liquidation, merger or consolidation of
the Company or any other corporation. Except as expressly provided herein, no
issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number of shares of Company
Stock subject to the exercise price of any Option or LSAR.
6. Rights as a Stockholder
No person shall have any rights as a stockholder with respect to any
shares of Company Stock covered by or relating to any Option or LSAR granted
hereunder until the date of the issuance of a stock certificate with respect to
such shares. Except as otherwise expressly provided in Section 5 hereof, no
adjustment to any Option or LSAR shall be made for dividends or other rights for
with the record date occurs prior to the date such stock certificate is issued.
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7. No Special Employment Rights; No Right to Options or LSARs
Nothing contained herein shall confer upon Grantee any right with
respect to the continuation of his employment by the Company or interfere in any
way with the right of the Company, subject to the terms of any separate
employment agreement to the contrary, at any time to terminate such employment
or to increase or decrease the compensation of Grantee from the rate in
existence at the time of the grant hereunder.
Grantee shall have no claim or right to receive any additional Options
or LSARs hereunder. The Committee's granting of Options and LSARs to Grantee at
any time shall neither require the Committee to grant Options and LSARs to
Grantee at any time nor preclude the Committee from making subsequent grants to
Grantee.
8. Securities Matters
(a) The Company shall be under no obligation to effect the registration
pursuant to the Securities Act of any interests in any shares of Company Stock
to be issued hereunder or to effect similar compliance under any state laws.
Notwithstanding anything herein to the contrary, the Company shall not be
obligated to cause to be issued or delivered any certificates evidencing shares
of Company Stock pursuant to this agreement unless and until the Company is
advised by its counsel that the issuance and delivery of such certificates is in
compliance with all applicable laws, regulations of governmental authority and
the requirements of the New York Stock Exchange and any other securities
exchange on which shares of Company Stock are traded. The Committee may require,
as a condition of the issuance and delivery of certificates evidencing shares of
Company Stock pursuant to the terms hereof, that the recipient of such shares
make such covenants, agreements and representations, and that such certificates
bear such legends, as the Committee, in its sole discretion, deems necessary or
desirable.
(b) The exercise of any Option granted hereunder shall be effective
only at such time as counsel to the Company shall have determined that the
issuance and delivery of shares of Company Stock pursuant to such exercise is in
compliance with all applicable laws, regulations of governmental authority and
the requirements of the New York Stock Exchange and any other securities
exchange on which shares of Company Stock are traded. The Committee may, in its
sole discretion, defer the effectiveness of any exercise of an Option granted
hereunder in order to allow the issuance of shares of Company Stock pursuant
thereto to be made pursuant to registration or an exemption from registration or
other methods for compliance available under federal or state securities laws.
The Committee shall inform Grantee in writing of its decision to defer the
effectiveness of the exercise of an Option granted hereunder. During the period
that the effectiveness of the exercise of an Option has been deferred, Grantee
may, by written notice, withdraw such exercise and obtain the refund of any
amount paid with respect thereto.
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9. Withholding Taxes
(a) Cash Remittance
Whenever shares of Company Stock are to be issued upon the exercise of
an Option, the Company shall have the right to require Grantee to remit to the
Company in cash an amount sufficient to satisfy federal, state and local
withholding tax requirements, if any, attributable to such exercise, prior to
the delivery of any certificate or certificates for such shares. In addition,
upon the exercise of an LSAR, the Company shall have the right to withhold from
any cash payment required to be made pursuant thereto an amount sufficient to
satisfy the federal, state and local withholding tax requirements, if any,
attributable to such exercise.
(b) Stock Remittance
Subject to Section 9(d) hereof at the election of Grantee, subject to
the approval of the Committee, when shares of Company Stock are to be issued
upon the exercise of an Option, in lieu of the remittance required by Section
9(a) hereof, the Grantee may tender to the Company a number of shares of Company
Stock determined by Grantee, the Fair Market Value of which at the tender date
the Committee determines to be sufficient to satisfy the federal, state and
local withholding tax requirements, if any, attributable to such exercise, and
not greater than Grantee's estimated total federal, state and local tax
obligations associated with such exercise.
(c) Stock Withholding
The Company shall have the right, when shares of Company Stock are to
be issued upon the exercise of an Option, in lieu of requiring the remittance
required by Section 9(a) hereof, to withhold a number of such shares, the Fair
Market Value of which at the exercise date the Committee determines to be
sufficient to satisfy the federal, state and local withholding tax requirements,
if any, attributable to such exercise, and is not greater than Grantee's
estimated total federal, state and local tax obligations associated with such
exercise.
(d) Timing and Method of Elections
Notwithstanding any other provisions of the Plan, Grantee who is
subject to Section 16(b) of the Exchange Act may not make the election described
in Section 9(b) hereof prior to the expiration of six months after the date on
which the applicable Option, was granted, except in the event of the death or
Disability of Grantee. If Grantee is subject to Section 16(b) of the Exchange
Act, Grantee may not make such election other than (i) during the 10-day window
period beginning on the third business day following the date of release for
publication of the Company's quarterly and annual summary statements of sales
and earnings and ending on the twelfth business day following such date or (ii)
at least six months prior to the date such election is made. Such elections
shall be irrevocable and shall be made by the delivery to the Company's
principal office, to the attention of its Secretary, of written notice signed by
Grantee.
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10. No Obligation to Exercise
The grant to Grantee of an Option and LSAR, shall impose no obligation
upon such Grantee to exercise such Option or LSAR.
11. Transfers Upon Death
Upon the death of Grantee, outstanding Options and LSARs may be
exercised only by the executors or administrators of Grantee's estate of by any
person or persons who shall have acquired such right to exercise by will or by
the laws of descent and distribution. No transfer by will or the laws of descent
and distribution of any Option or LSAR, or the right to exercise any Option or
LSAR, shall be effective to bind the Company unless the Committee shall have
been furnished with (a) written notice thereof and with a copy of the will
and/or such evidence as the Committee may deem necessary to establish the
validity of the transfer and (b) an agreement by the transferee to comply with
all the terms and conditions of this agreement that are or would have been
applicable to Grantee and to be bound by the acknowledgments made by Grantee in
connection with the grant of the Option and LSAR. Except as provided in this
Section 11, no Option or LSAR shall be transferable, and shall be exercisable
only by a Grantee during the Grantee's lifetime.
12. Failure to Comply
In addition to the remedies of the Company elsewhere provided for
herein, failure by Grantee (or beneficiary) to comply with any of the terms and
conditions hereof, unless such failure is remedied by Grantee (or beneficiary)
within ten days after having been notified of such failure by the Committee,
shall be grounds for the cancellation and forfeiture of such Option and LSAR, in
whole or in part, as the Committee, in its absolute discretion, may determine.
13. Applicable Law
Except to the extent preempted by any applicable federal law, this
agreement will be construed and administered in accordance with the laws of the
State of Arkansas, without reference to the principles of conflicts of law.
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Exhibit 5.1
CONNER & WINTERS
P.L.L.C.
LAWYERS
100 WEST CENTER
SUITE 200
FAYETTEVILLE, ARKANSAS 72701
February 4, 2000
Southwestern Energy Company
1083 Sain Street
Fayetteville, Arkansas 72703
Re: Registration Statement of Form S-8
Ladies and Gentlemen:
We have acted as counsel to Southwestern Energy Company, an Arkansas
corporation (the "Company"), in connection with the preparation and filing with
the Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "Securities Act"), of the Registration Statement on
Form S-8 (the "Registration Statement"), relating to an aggregate of 206,785
shares of the Company's common stock, par value $.10 per share (the "Shares"),
which may be issued under the terms of the separate stock option agreements and
restricted stock agreements (collectively, the "Agreements") between the Company
and certain of its employees.
In rendering the following opinion, we have reviewed the originals or
copies certified or otherwise identified to our satisfaction of all such
corporate records of the Company and such other instruments and other
certificates of public officials, officers and representatives of the Company
and such other persons, and we have made such investigations of law, as we have
deemed appropriate as a basis for the opinion expressed below. In rendering the
opinion expressed below, we have assumed the authenticity of all documents
submitted to us as originals and the conformity to the originals of all
documents submitted to us as copies.
Based on the foregoing, we are of the opinion that the Shares have been
duly authorized by all necessary corporate action of the Company, and the
Shares, when issued and paid for in accordance with the terms of the Agreements
and at a price per share in excess of the par value per share for such Shares,
will be legally issued, fully paid, and nonassessable.
<PAGE>
February 4, 2000
Page 2
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to our firm under the caption "Legal
Matters" in the Registration Statement. In giving this consent, we do not
thereby admit that we are in a category of persons whose consent is required
under Section 7 of the Securities Act or the rules and regulations of the
Commission issued thereunder.
Very truly yours,
/s/ Conner & Winters
Conner & Winters, P.L.L.C.
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports dated February 3, 1999
included in Southwestern Energy Company's Form 10-K for the year ended December
31, 1998, and to all references to our Firm included in this registration
statement.
ARTHUR ANDERSEN LLP
February 4, 2000
Tulsa, Oklahoma
