<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 8, 1999
REGISTRATION NO. 333-61039
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------
EL PASO ENERGY CORPORATION
(Exact name of co-registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 76-0568816
(State or other jurisdiction of incorporation or (I.R.S. Employer Identification No.)
organization)
</TABLE>
---------------------
1001 LOUISIANA STREET, HOUSTON, TEXAS, 77002
(713) 420-2131
(Address, including zip code, and telephone number, including area code, of
co-registrant's principal executive offices)
---------------------
DEEPTECH INTERNATIONAL INC.
(Exact name of co-registrant as specified in its charter)
---------------------
<TABLE>
<S> <C>
DELAWARE 76-0289338
(State or other jurisdiction of incorporation or (I.R.S. Employer Identification Number)
organization)
</TABLE>
---------------------
1001 LOUISIANA STREET, HOUSTON, TEXAS, 77002
(713) 420-2131
(Address, including zip code, and telephone number, including
area code, of co-registrant's principal executive offices)
---------------------
BRITTON WHITE, JR., ESQ.
EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL
EL PASO ENERGY CORPORATION
1001 LOUISIANA STREET, HOUSTON, TEXAS, 77002
(713) 420-2131
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
---------------------
Copy to:
GARY P. COOPERSTEIN, ESQ.
FRIED, FRANK, HARRIS, SHRIVER & JACOBSON
ONE NEW YORK PLAZA
NEW YORK, NY 10004
(212) 859-8000
---------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement.
---------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
---------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
PROSPECTUS
- -----------------
DEEPTECH INTERNATIONAL INC.
$77,600,000 12% SENIOR NOTES DUE 2000
FULLY AND UNCONDITIONALLY GUARANTEED BY
EL PASO ENERGY CORPORATION
---------------------
The $77,600,000 12% Senior Notes Due 2000 (the "Senior Notes," or the
"Securities") of DeepTech International Inc. ("DeepTech") and the guarantees
associated with the Senior Notes (the "Guarantees," and together with the
Securities, the "Guaranteed Securities"), to which this Prospectus relates will
be offered (the "Offering") by certain holders of the Senior Notes (the "Selling
Holders"). All of the Selling Holders do not necessarily intend to sell their
Guaranteed Securities, but they may decide to do so in the future. See "Selling
Holders." The Guaranteed Securities offered by the Selling Holders may be sold
from time to time at prices then prevailing, in negotiated transactions or in
the over-the-counter market, or in brokerage transactions, or in a combination
of such transactions. Neither El Paso Energy Corporation ("El Paso Energy" or
the "Company") nor DeepTech will receive any proceeds from the sale of the
Guaranteed Securities offered hereby.
Interest on the Senior Notes is payable semi-annually on June 15 and
December 15 of each year. The Senior Notes may be redeemed at the option of
DeepTech, in whole or in part, at any time on or after June 15, 1999 upon not
less than 30 days' nor more than 60 days' notice, at 106% of their principal
amount, plus accrued interest, and at 100% of such principal amount, plus
accrued and unpaid interest, to the date of redemption from and after June 15,
2000. The Senior Notes rank pari passu in right of payment with all other senior
Indebtedness (defined herein) and senior to all other Indebtedness of DeepTech.
As a result of a holding company reorganization effected on August 1, 1998,
El Paso Natural Gas Company ("EPNG") became a wholly owned subsidiary of El Paso
Energy and El Paso Energy succeeded EPNG as the publicly traded corporation. In
conjunction with the merger of DeepTech with EPNG or El Paso Energy (the
"Merger") pursuant to the Agreement and Plan of Merger dated as of February 27,
1998, as amended, and the solicitations (the "Solicitations") of consents to
certain waivers (the "Waivers") and amendments (the "Amendments") from the
holders of the Senior Notes (the "Holders") by EPNG and DeepTech pursuant to a
consent solicitation statement (the "Statement") and a Consent Letter (the
"Consent Letter") with respect to the Securities, EPNG agreed that EPNG or El
Paso Energy, as successor to EPNG, would guarantee the Securities and would
register the resales of such Guarantees under the Securities Act of 1933, as
amended (the "Securities Act"), if the Merger were effected between DeepTech and
a subsidiary of El Paso Energy. Based upon elections made by stockholders of
DeepTech, on August 14, 1998 the Merger was effected as a merger of a subsidiary
of El Paso Energy into DeepTech, and El Paso Energy issued the Guarantees on
that date. The Registration Statement of which this Prospectus forms a part is
being filed to permit the resale under the Securities Act of the Securities as
well as the resale of the Guarantees.
The Senior Notes are not listed on any securities exchange or authorized
for quotation on the Nasdaq system.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
---------------------
THE DATE OF THIS PROSPECTUS IS MARCH 8, 1999.
<PAGE> 3
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER
CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY
OR BY ANY AGENT, UNDERWRITER OR DEALER. NEITHER THE DELIVERY OF THIS PROSPECTUS,
NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY
IMPLICATION THAT THERE
HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATES AS OF WHICH
INFORMATION IS GIVEN IN THIS PROSPECTUS. THIS PROSPECTUS DOES NOT CONSTITUTE AN
OFFER OR SOLICITATION BY ANYONE IN ANY STATE IN WHICH SUCH OFFER OR SOLICITATION
IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS
NOT QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH
OFFER OR SOLICITATION. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY ANY SECURITY OTHER THAN THOSE TO WHICH THIS
PROSPECTUS RELATES.
---------------------
AVAILABLE INFORMATION
Each of the Company, EPNG and Leviathan Gas Pipeline Partners, L.P.
("Leviathan"), of which Leviathan Gas Pipeline Company, an indirect subsidiary
of DeepTech, is the general partner and the holder of a 27.3% ownership
interest, is, and DeepTech was, subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in
accordance therewith, each of the Company, EPNG and Leviathan files, and
DeepTech filed, reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information may be inspected and copied at the public
reference facilities maintained by the Commission, at 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the following Regional Offices of the Commission:
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661;
and 7 World Trade Center, Suite 1300, New York, New York 10048. Copies of such
material also may be obtained from the Public Reference Section of the
Commission, at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed
rates. The Commission also maintains a World Wide Web site that contains
reports, proxy and information statements and other information regarding
registrants that file electronically with the Commission (at
http://www.sec.gov). The Company's common stock and the common units and
preference units of Leviathan are listed on the NYSE (as was the common stock of
EPNG), and the common stock of DeepTech prior to the Merger was listed on the
Nasdaq National Market, and reports, proxy statements and other information (i)
concerning the Company, El Paso and Leviathan can be inspected at the offices of
the NYSE, 20 Broad Street, New York, New York 10005 and (ii) concerning DeepTech
can be inspected at the offices of NASD Operations, 1735 K Street, N.W.,
Washington, D.C.
This Prospectus does not contain all of the information set forth in the
Registration Statement filed with the Commission by the Company and DeepTech,
certain parts of which are omitted in accordance with the rules and regulations
of the Commission. Reference is made to the Registration Statement and the
exhibits thereto for further information. Exhibits to the Registration Statement
that are omitted from this Prospectus may also be obtained at the Commission's
World Wide Web site described above. Statements contained or incorporated by
reference herein concerning the provisions of any agreement or other document
filed as an exhibit to the Registration Statement or otherwise filed with the
Commission are not necessarily complete, and readers are referred to the copy so
filed for more detailed information, each such statement being qualified in its
entirety by such reference.
2
<PAGE> 4
PRIVATE SECURITIES LITIGATION REFORM ACT SAFE HARBOR STATEMENT
This Prospectus (including the documents incorporated by reference herein)
contains forward-looking statements within the meaning of Section 27A of the
Securities Act and Section 21E of the Exchange Act. Where any such
forward-looking statement includes a statement of the assumptions or bases
underlying such forward-looking statement, the Company and DeepTech caution
that, while such assumptions or bases are believed to be reasonable and are made
in good faith, assumed facts or bases almost always vary from the actual
results, and the differences between assumed facts or bases and actual results
can be material, depending upon the circumstances. Where, in any forward-looking
statement, the Company or DeepTech, including their respective subsidiaries, or
their respective management, expresses an expectation or belief as to future
results, such expectation or belief is expressed in good faith and is believed
to have a reasonable basis, but there can be no assurance that the statement of
expectation or belief will result or be achieved or accomplished. The words
"believe," "expect," "estimate," "anticipate" and similar expressions may
identify forward-looking statements.
Important factors that could cause actual results to differ materially from
those in the forward-looking statements herein include increasing competition
within the Company's and DeepTech's industry, the timing and extent of changes
in commodity prices for natural gas and power, uncertainties associated with
acquisitions and joint ventures, potential environmental liabilities, potential
contingent liabilities and tax liabilities related to the Company's and
DeepTech's acquisitions, political and economic risks associated with current
and future operations in foreign countries, conditions of the equity and other
capital markets during the periods covered by the forward-looking statements,
and other risks, uncertainties and factors, including the effect of the year
2000 date change, discussed more completely in the other filings of the Company,
EPNG, as predecessor of the Company, DeepTech and Leviathan with the Commission,
including the Annual Report on Form 10-K for the year ended December 31, 1997
for the Company and Leviathan and the Annual Report on Form 10-K for the year
ended June 30, 1997 for DeepTech.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents heretofore filed with the Commission by the
Company, EPNG, DeepTech and Leviathan pursuant to the Exchange Act are
incorporated herein by reference:
EPNG (FILE NO. 1-2700) AND COMPANY COMMISSION FILINGS (FILE NO. 1-14365)
1. EPNG's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997 (the "Form 10-K");
2. EPNG's Quarterly Reports on Form 10-Q for the quarterly periods
ended March 31, 1998, June 30, 1998 and September 30, 1998, and the
Company's Quarterly Report on Form 10-Q for the quarterly period ended
September 30, 1998;
3. The portions of EPNG's definitive Proxy Statement for the Annual
Meeting of Stockholders held on May 12, 1998 that have been incorporated by
reference into the Form 10-K and the Company's Preliminary Proxy Statement
on Schedule 14A dated on February 26, 1999; and
4. EPNG's Current Reports on Form 8-K dated December 26, 1996, March
17, 1998, August 3, 1998, October 16, 1998 and January 14, 1999 and Form
8-K/A dated January 21, 1997 and January 22, 1997, and the Company's
Current Reports on Form 8-K dated August 3, 1998 and August 25, 1998.
DEEPTECH COMMISSION FILINGS (FILE NO. 1-959)
1. The DeepTech Proxy Statement on Schedule 14A dated November 24,
1997;
2. The DeepTech Annual Report on Form 10-K/A for the year ended June
30, 1997;
3. The DeepTech Quarterly Reports on Form 10-Q for the quarterly
periods ended September 30, 1997, December 31, 1997 and March 31, 1998; and
3
<PAGE> 5
4. The DeepTech Current Reports on Form 8-K dated July 23, 1997,
December 31, 1997 and August 28, 1998.
LEVIATHAN COMMISSION FILINGS (FILE NO. 1-11680)
1. The Leviathan Annual Report on Form 10-K for the year ended
December 31, 1997;
2. The Leviathan Quarterly Reports on Form 10-Q for the quarterly
periods ended March 31, 1998, June 30, 1998 and September 30, 1998;
3. The Leviathan Definitive Proxy Statement on Schedule 14A dated
February 8, 1999; and
4. The Leviathan Current Report on Form 8-K dated September 16, 1998.
All documents filed by the Company or Leviathan pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus
and prior to the termination of the offering of the Guaranteed Securities
offered hereby shall be deemed to be incorporated by reference in this
Prospectus and to be part hereof from the date of filing of such documents. Any
statement contained in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained therein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein 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 Prospectus. The Company will provide without charge
to each person, including any beneficial owner of the Guaranteed Securities, to
whom a copy of this Prospectus is delivered, upon written or oral request of
such person, a copy of any or all documents incorporated by reference in this
Prospectus (other than exhibits to such documents unless such exhibits are
specifically incorporated by reference into such documents). Written requests
for such copies should be directed to the Vice President, Investor and Public
Relations, El Paso Energy Corporation, 1001 Louisiana Street, Houston, Texas
77002 (telephone (713) 420-2131).
---------------------
4
<PAGE> 6
THE COMPANIES
GENERAL
THE COMPANY. The Company is a Delaware corporation which was incorporated
in 1998. As a result of a holding company reorganization effected on August 1,
1998, the Company succeeded EPNG, a Delaware corporation formed in 1928, as the
publicly traded corporation, and EPNG and its subsidiaries became direct and
indirect subsidiaries of the Company.
The Company's principal operations include the interstate and intrastate
transportation, gathering and processing of natural gas; the marketing of
natural gas, power, and other commodities; and the development and operation of
energy infrastructure facilities worldwide. The Company owns or has interests in
over 28,200 miles of interstate and intrastate pipeline connecting the nation's
principal natural gas supply regions to the four largest consuming regions in
the United States, namely the Gulf Coast, California, the Northeast and the
Midwest. The Company's natural gas transmission operations include one of the
nation's largest mainline natural gas transmission systems which is comprised of
five interstate pipeline systems: the El Paso Natural Gas pipeline, the
Tennessee Gas pipeline, Midwestern Gas Transmission pipeline, the East Tennessee
Natural Gas pipeline, and the Mojave Pipeline pipeline. Intrastate transmission
operations are conducted through the Company's interests in Oasis Pipe Line
Company, Channel Industries, and Gulf States Gas Pipeline Company.
In addition to its interstate and intrastate transmission services, the
Company provides services including natural gas gathering, products extraction,
dehydration, purification and compression. These operations include interests in
41 gathering systems, 25 natural gas processing and treating facilities located
in the most prolific and active production areas of the United States (including
the San Juan and Permian Basins and in East Texas, South Texas, Louisiana, and
the Gulf of Mexico). The Company's marketing activities include the marketing
and trading of natural gas, power and petroleum products, as well as providing
integrated price risk management services associated with these commodities.
Also, the Company participates in the development and ownership of domestic
power generation facilities and other power-related assets and joint ventures.
The Company's international activities are focused on the development and
operation of international energy infrastructure projects and include ownership
interests in (i) three major existing natural gas transmission systems in
Australia, (ii) natural gas transmission systems and power generation facilities
currently in operation or under construction in Argentina, Bolivia, Brazil,
Chile, Czech Republic, Hungary, Indonesia, Mexico, Pakistan and Peru, and (iii)
three operating domestic power generation plants.
The Company's principal executive offices are located at 1001 Louisiana
Street, Houston, Texas 77002, and its telephone number at that address is (713)
420-2131.
DEEPTECH. DeepTech is a holding company which is engaged, through its
general and limited partnership interests in Leviathan in the acquisition,
development, production, processing, transportation and marketing of, and the
exploration for, oil and gas located offshore the United States in the Gulf of
Mexico. DeepTech's principal executive offices are located at 1001 Louisiana
Street, Houston, Texas 77002, and its telephone number at that address is (713)
420-2131.
THE MERGER AND RELATED TRANSACTIONS
General
On February 27, 1998, EPNG, El Paso Acquisition Company ("Merger Sub"), a
direct wholly owned subsidiary of EPNG, and DeepTech entered into an Agreement
and Plan of Merger (as amended from time to time, the "Merger Agreement"),
providing for the merger (the "Merger") of DeepTech with EPNG or a subsidiary of
EPNG. The Merger Agreement was amended on June 16, 1998 to add the Company as a
party, and to provide for the issuance of the common stock, par value $3.00 per
share, of the Company (the "Company Common Stock") in lieu of common stock of
EPNG and for the merger of DeepTech with the Company or a subsidiary of the
Company, if the holding company reorganization were to occur prior to the
Merger. Prior to the Merger, DeepTech disposed of substantially all of its
assets other than its general and limited partnership interests in Leviathan,
through the contribution of its offshore drilling services business to its
94%-owned subsidiary, Tatham Offshore, Inc. ("Tatham Offshore"), and a rights
offering (the "Rights
5
<PAGE> 7
Offering") to DeepTech stockholders of the shares of Tatham Offshore owned by
DeepTech and its subsidiaries. As a result of the foregoing transactions,
DeepTech has no material assets other than its Leviathan interests and cash. The
Merger occurred on August 14, 1998.
Merger Consideration
As a result of the Merger, based upon the elections which were made by
stockholders of DeepTech, each DeepTech stockholder received for each share of
DeepTech common stock, par value $0.01 per share (the "DeepTech Common Stock"),
(i) 0.4236 of a share of the Company Common Stock or (ii) $14.00 in cash,
without interest.
As of the effective time of the Merger, the Company agreed to guarantee the
Securities pursuant to the Guarantees.
For further information regarding the Merger and the related transactions
undertaken in connection therewith, see the Registration Statement on Form S-4
(Registration No. 333-49863), which has been filed with the Commission.
THE EL PASO REORGANIZATION
On August 1, 1998, EPNG effected the holding company reorganization whereby
EPNG and its subsidiaries became direct and indirect subsidiaries of the
Company. Pursuant to the holding company reorganization, holders of shares of
the common stock, par value $3.00 per share, of EPNG became holders on a
share-for-share basis of shares of the Company Common Stock with the result that
the Company replaced EPNG as the publicly held corporation. The change to a
holding company structure was tax free for federal income tax purposes to
stockholders of EPNG and was effected without a vote of stockholders under
applicable Delaware law.
USE OF PROCEEDS
The Guaranteed Securities offered hereby are being sold by the Selling
Holders named under the caption "Selling Holders." Neither El Paso Energy nor
DeepTech will receive any proceeds from the Offering.
EL PASO ENERGY CORPORATION
RATIO OF EARNINGS TO FIXED CHARGES AND RATIO OF
EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED AND PREFERENCE STOCK DIVIDEND REQUIREMENTS
<TABLE>
<CAPTION>
NINE MONTHS
ENDED YEAR ENDED DECEMBER 31,
SEPTEMBER 30, --------------------------------
1998(2) 1997 1996 1995 1994 1993
------------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges and Ratio of
Earnings to Combined Fixed Charges and
Preferred and Preference Stock Dividend
Requirements(1).............................. 2.02x 2.26x 1.59x 2.51x 2.87x 3.04x
</TABLE>
- ---------------
(1) The ratio of earnings to combined fixed charges and preferred and
preference stock dividend requirements for the periods presented is the
same as the ratio of earnings to fixed charges since El Paso Energy has no
outstanding preferred stock or preference stock and, therefore, no dividend
requirements.
(2) Because of the seasonal nature of El Paso Energy's business, the ratio for
the nine month period may not necessarily be indicative of the ratio that
will result for the full year 1998.
For purposes of calculating these ratios: (i) "fixed charges" represent
interest cost (exclusive of interest on rate refunds), amortization of debt
costs, the estimated portion of rental expense representing the interest
6
<PAGE> 8
factor, and pre-tax preferred stock dividend requirements of majority owned
subsidiaries; and (ii) "earnings" represent the aggregate of income from
continuing operations before income taxes, interest expense (exclusive of
interest on rate refunds), amortization of debt costs, the estimated portion of
rental expense representing the interest factor, and the actual amount of any
preferred stock dividend requirements of majority owned subsidiaries, adjusted
to reflect actual distributions from equity investments.
DESCRIPTION OF THE SENIOR NOTES
The Senior Notes were issued under an indenture dated as of March 21, 1994,
as amended by the First Supplemental Indenture dated August 14, 1998 (the
"Indenture"), between DeepTech and the Bank of New York, successor in interest
to the First Interstate Bank of Texas, N.A., as trustee (the "Trustee"). The
terms of the Senior Notes include those made part of the Indenture by reference
to the Trust Indenture Act of 1939, as amended, as in effect on the date of the
Indenture (the "Trust Indenture Act"). The Senior Notes are subject to all such
terms, and holders of the Senior Notes are referred to the Indenture and the
Trust Indenture Act for a statement of those terms. The following is a summary
of the material provisions of the Indenture. Copies of the Indenture
substantially in the form in which it was executed as of March 21, 1994 and the
First Supplemental Indenture have been filed with the Commission as exhibits to
the Registration Statement (the "Registration Statement") of which this
Prospectus (the "Prospectus") is a part. Capitalized terms used in this section
and not otherwise defined below have the respective meanings assigned to them in
the Indenture.
GENERAL
The Senior Notes are general obligations of DeepTech, limited to $82
million in aggregate principal amount. The Senior Notes will mature on December
15, 2000 and bear interest at 12% per annum, payable semiannually in arrears on
June 15 and December 15 of each year, to the persons who are registered holders
thereof at the close of business on May 31 or November 30, immediately preceding
such interest payment date. Interest on the Senior Notes is computed on the
basis of a 360-day year of twelve 30-day months. The Trustee acts as Paying
Agent and Registrar. Principal and premium, if any, and interest are payable at
the offices of the Trustee but, at the option of DeepTech, interest may be paid
by check mailed to the persons who are registered holders of Senior Notes at
their registered addresses. Holders of the Senior Notes must surrender such
Senior Notes to the Paying Agent to collect principal payments. The Senior Notes
may be presented for registration of transfer or for exchange at the offices of
the Trustee and are issued in fully registered form, in denominations of $1,000
and any integral multiple thereof. DeepTech may require payment of a sum
sufficient to cover any tax or governmental charge payable in connection with
certain transfers and exchanges.
The Senior Notes rank senior in right of payment to all existing and future
subordinated Indebtedness of DeepTech and pari passu in right of payment with
all other Indebtedness of DeepTech.
OPTIONAL REDEMPTION
At any time on or after June 15, 1999, DeepTech may, at its option, redeem
all or any portion of the Senior Notes at the redemption prices (expressed as
percentages of the principal amount of the Senior Notes) set forth below, plus,
in each case, accrued and unpaid interest thereon to the applicable redemption
date, if redeemed during the 12-month period beginning June 15 of the years
indicated below:
<TABLE>
<CAPTION>
YEAR PERCENTAGE
---- ----------
<S> <C>
1999..................................................... 106%
2000 and thereafter...................................... 100%
</TABLE>
If less than all of the Senior Notes are to be redeemed pursuant to the
immediately preceding paragraph, the Trustee shall select pro rata, by lot or in
such other manner as it deems appropriate or fair, the Senior Notes to be
redeemed in integral multiples of $1,000. Senior Notes in denominations larger
than $1,000 may be redeemed in part, provided such part is an integral multiple
of $1,000.
Notice of redemption will be sent by first-class mail, at least 30 days and
not more than 60 days prior to the date fixed for redemption to each holder of
Senior Notes to be redeemed at the last address for such holder
7
<PAGE> 9
then shown on the registry books. Any notice that relates to a Senior Note to be
redeemed in part only shall state the portion of the principal amount to be
redeemed and that on and after the redemption date, upon surrender of the Senior
Note, a new Senior Note or Senior Notes will be issued in a principal amount
equal to the unredeemed portion thereof. On and after the redemption date
(unless DeepTech shall default in the payment of such Senior Notes at the
redemption price, together with accrued interest to the redemption date),
interest will cease to accrue on the Senior Notes or part thereof called for
redemption.
MANDATORY SINKING FUND
There are no mandatory sinking fund payments for the Senior Notes.
CERTAIN COVENANTS
The Indenture contains certain customary covenants regarding DeepTech's
business and operations and includes, among others, the following covenants.
Limitation on Consolidation or Merger. The Indenture provides that DeepTech
will not, in a single transaction or a series of related transactions,
consolidate with or merge with or into, or sell, assign, transfer, lease, convey
or otherwise dispose of its assets substantially as an entirety to, any Person
or group of affiliated Persons, unless at the time and after giving effect
thereto (i) either (a) DeepTech is the continuing or surviving corporation or
(b) the Person (if other than DeepTech) formed by or surviving such
consolidation into which DeepTech is merged or the person that acquires by
conveyance, transfer or lease the properties and assets of DeepTech
substantially as an entirety is a corporation organized and validly existing
under the laws of the United States or any state thereof or the District of
Columbia, and shall expressly assume, by a supplemental indenture, the due and
punctual payment of the principal of, premium, if any, and interest on, all the
securities and the performance of every other Obligation and covenant of
DeepTech under the Securities and the Indenture; (ii) immediately after giving
effect to such transaction, no Default or Event of Default shall have occurred
and be continuing; and (iii) DeepTech has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger or transfer and, if a supplemental indenture is required in connection
with such transaction, such supplemental indenture, comply with the Indenture
and that all conditions precedent therein (in the case of clause (ii) above, to
such counsel's knowledge) relating to such transaction have been satisfied.
CERTAIN DEFINITIONS
Set forth below is a summary of certain of the defined terms used in the
Indenture. Reference is made to the Indenture for the full definition of all
such terms, as well as any other terms used herein for which no definition is
provided.
"Capital Lease Obligations" of a Person means any obligation which is
required to be classified and accounted for as a capital lease on the face of a
balance sheet of such Person prepared in accordance with GAAP; the amount of
such obligations shall be the capitalized amount thereof, determined in
accordance with GAAP; and the Stated Maturity thereof shall be the date of the
last payment of rent or any other amount due under such lease prior to the first
date upon which such lease may be terminated by the lessee without payment of a
penalty.
"Capital Stock" means, with respect to any Person, any capital stock
(including preferred stock), shares, interests, participations or other
ownership interests (however designated) of such Person and any rights (other
than debt securities convertible into or exchangeable for capital stock),
warrants or options to purchase any thereof.
"Code" means the Internal Revenue Code of 1986, as amended.
"Currency Agreement" means any foreign exchange contract, currency swap
agreement or other similar agreement or arrangement designed to protect against
fluctuation in currency values.
8
<PAGE> 10
"Date of Determination" means the date on which a calculation is required
to be made pursuant to the terms of the Indenture.
"Default" means any event which with the giving of notice or the passage of
time or both would become an Event of Default.
"Disqualified Stock" means, with respect to any Person, any Capital Stock
of such Person which by its terms (or by the terms of any security into which it
is convertible or for which it is exchangeable or excercisable), or upon the
happening of any event or otherwise (i) matures or is mandatorily redeemable,
pursuant to a sinking fund obligation or otherwise, (ii) is convertible into or
exchangeable or exercisable for Indebtedness or Disqualified Stock or (iii) is
redeemable at the option of the holder thereof in whole or in part, in each case
on or prior to the Stated Maturity of the Senior Notes.
"GAAP" means generally accepted accounting principles, as in effect in the
United States of America on the date of issuance of the Senior Notes.
"Indebtedness" of any Person means, without duplication, all liabilities
for (i) indebtedness of such Person for money borrowed; (ii) indebtedness
evidenced by bonds, notes, debentures, or similar instruments for the payment of
which such Person is responsible or liable, (iii) all obligations of such Person
issued or assumed as the deferred purchase price of Property or services (except
to the extent such obligations constitute trade payables or accrued expenses if
and to the extent that such obligations would appear as a liability on the
balance sheet of such Person in accordance with GAAP), all conditional sale
obligations of such Person and all obligations under any title retention
agreement; (iv) all obligations of such Person in respect of Currency Agreements
or Interest Swap Obligations; (v) the principal amount of all obligations of
such Person with respect to the redemption, repayment or other repurchase of any
Disqualified Stock; (vi) all Capitalized Lease Obligations of such Person; (vii)
all obligations of the type referred to in this definition of Indebtedness of
other Persons, together with all dividends of other Persons for the payment of
which, in either case, such Person is responsible or liable as obligor,
guarantor or otherwise; and (viii) all obligations of the type referred to in
this definition of Indebtedness of other Persons secured by any Lien on, or in
respect of which there is recourse to, any Property of the Person whose
Indebtedness is determined hereunder (whether or not such obligation is assumed
by such Person), the amount of such obligation being deemed to be the lesser of
the value of such Property or the amount of the obligation so secured or in
respect of which there is such recourse.
"Interest Swap Obligations" means the obligations of any Person pursuant to
any interest rate swap, cap, collar or other similar agreement or arrangement
designed to provide protection against fluctuations in interest rates.
"Lien" means, with respect to any asset, any mortgage, pledge, lien,
charge, adverse claim affecting title, deed of trust, security interest, option
or other agreement to sell or any other similar encumbrance (including any
agreement to give any of the foregoing). For purposes of the Indenture, a Person
shall be deemed to own subject to a Lien any Property that it has acquired or
holds subject to the interest of a vendor or lessor under any conditional sale
agreement, Capitalized Lease Obligation or other title retention agreement
(including any lease in the nature thereof) relating to such Property.
"Officers' Certificate" means, with respect to any Person, a certificate
signed by two of the following officers: the Chairman of the Board, the Chief
Executive Officer, the President, any Vice President, the Chief Financial
Officer or the Treasurer of such Person.
"Person" means any individual, corporation, partnership, joint venture,
trust, estate, unincorporated organization or government or any agency or
political subdivision thereof.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Significant Subsidiary" means a "significant subsidiary" as defined in
Section 1-02(v) of Regulation S-X under the Securities Act and the Exchange Act.
9
<PAGE> 11
"Stated Maturity" means, with respect to any security, the date specified
in such security as the fixed date on which the principal of such security is
due and payable, including pursuant to any mandatory redemption provision.
"Subordinated Debt" means the subordinated debt of DeepTech that is
outstanding on the date of issuance of the Senior Notes.
"Subsidiary" of DeepTech means a corporation more than 50% of the
outstanding Voting Stock of which is owned, directly or indirectly, by DeepTech
or by one or more other Subsidiaries, or by DeepTech and one or more other
Subsidiaries of DeepTech.
"U.S. Government Obligations" means direct obligations (or certificates
representing an ownership interest in such obligations) of, or obligations
unconditionally and irrevocably guaranteed by, the United States of America
(including any agency or instrumentality thereof) for the payment of which the
full faith and credit of the United States of America is pledged and which are
not callable at the issuer's option.
"Voting Stock" means securities of any class or classes of a Person, the
holders of which are ordinarily, in the absence of contingencies, entitled to
vote for corporate directors (or Persons performing equivalent functions).
EVENTS OF DEFAULT
The following events are defined in the Indenture as "Events of Default":
(i) DeepTech defaults in the payment of any installment of interest on any
Security when due and payable and continuance of such default for 30 days; (ii)
DeepTech defaults in the payment of the principal of or the premium, if any, on
any Security when due and payable at Stated Maturity, upon acceleration, upon
optional redemption of the Securities, upon declaration or otherwise; (iii)
DeepTech fails to observe, perform or comply with any of its other agreements or
covenants in or provisions of the Securities or the Indenture and such failure
to observe, perform or comply continues for a period of 60 days after receipt by
DeepTech of written notice thereof from the Trustee or Holders of at least 25%
in principal amount of the Securities then outstanding, specifying such default
and requiring that it be remedied; (iv) DeepTech or any Subsidiary fails to make
any payment in the amount of $50,000 or more constituting principal of, or
premium, if any, in respect of, or interest on, any Indebtedness when due (after
giving effect to any grace period applicable thereto), and the aggregate
principal amount of such Indebtedness with respect to which any such failure to
pay has occurred exceeds $25 million or its foreign currency equivalent in the
aggregate; (v) any Indebtedness of DeepTech or any of its Subsidiaries is
accelerated or becomes due or is declared due and payable because of a default,
and the aggregate principal amount of such Indebtedness with respect to which
any such failure to pay has occurred exceeds $25 million or its foreign currency
equivalent in the aggregate; (vi) DeepTech or any Significant Subsidiary
pursuant to or within the meaning of any Bankruptcy Law: (A) commences a
voluntary case or proceeding, (B) consents to the entry of an order for relief
against it in an involuntary case or proceeding, (C) consents to the appointment
of a Custodian of it or for all or substantially all of its property, (D) makes
a general assignment for the benefit of its creditors, or (E) admits in writing
that it generally is unable to pay its debts as the same become due; or (vii) a
court of competent jurisdiction enters an order or decree under any Bankruptcy
Law that: (A) is for relief (with respect to the petition commencing such case)
against DeepTech or any Significant Subsidiary in an involuntary case or
proceeding, (B) appoints a Custodian for DeepTech or any Significant Subsidiary
or for all or substantially all of its respective property, or (C) orders the
liquidation of DeepTech or any Significant Subsidiary, and the order or decree
remains unstayed and in effect for 60 days.
The terms "Bankruptcy Law" means Title 11, U.S. Code or any similar federal
or state law for the relief of debtors. The term "Custodian" means any receiver,
trustee, assignee, liquidator or similar official under any Bankruptcy Law.
The Indenture provides that the Trustee, within 30 days after the
occurrence of any continuing Default that is known to the Trustee, will give
notice thereof to the Holders; provided, however, that, except in the case of a
Default in payment of principal of or interest on the Senior Notes or Default
resulting from bankruptcy or
10
<PAGE> 12
insolvency, the Trustee may withhold such notice as long as it in good faith
determines that such withholding is in the interest of the Holders.
If an Event of Default (other than an Event of Default resulting from
bankruptcy, insolvency or reorganization) occurs and is continuing, the Trustee
or the Holders of at least 25% in principal amount of the Senior Notes then
outstanding, by notice in writing to DeepTech, may declare the principal of,
premium, if any, and accrued interest on all the Senior Notes to be due and
payable. If an Event of Default resulting from bankruptcy, insolvency or
reorganization shall occur, such principal, premium, if any, and accrued
interest shall be due and payable without any declaration or other act on the
part of the Trustee or any Holder. Upon such a declaration or acceleration, such
principal, premium, if any, and accrued interest shall be due and payable
immediately.
The Holders of a majority in aggregate principal amount of the Senior Notes
issued under the Indenture at the time outstanding by notice to the Trustee may
on behalf of the holders of the Senior Notes waive any existing Default or Event
of Default under the Indenture and its consequences, except a continuing Default
or Event of Default in the payment of interest on, or the principal of and
premium, if any, on the Senior Notes.
Except to enforce the right to receive payment of principal, premium, if
any, or interest when due, no Holder may pursue any remedy with respect to the
Indenture or Senior Notes unless such Holder has previously given to the Trustee
written notice of a continuing Event of Default and unless the Holders of at
least 25% in principal amount of the Senior Notes have requested the Trustee to
pursue remedies in respect of such Event of Default and have offered the Trustee
reasonable security or indemnity against any loss, liability or expense to be
thereby incurred and the Trustee has not complied with the request for 60 days
after receipt of the request and the offer of indemnity and security and unless
the Holders of a majority in principal amount of the Senior Notes have not given
the Trustee a direction inconsistent with such request during such 60-day
period. Subject to certain restrictions, the Holders of a majority in principal
amount of the Senior Notes are given the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on the Trustee. The Trustee, however,
may refuse to follow any direction that conflicts with law or the Indenture,
that is unduly prejudicial to the rights of any Holder or that would subject the
Trustee to personal liability; provided, however, that the Trustee may take any
other action deemed proper by the Trustee that is not inconsistent with such
direction. Prior to taking any action hereunder, the Trustee shall be entitled
to indemnification and security satisfactory to it in its sole discretion
against any and all losses and expenses caused by taking such action.
DeepTech is required to furnish to the Trustee, within 120 days after the
end of each fiscal year, an Officer's Certificate to the effect that such
officers have conducted or supervised a review of the activities of DeepTech and
its Subsidiaries and of performance under the Indenture and that, based on their
review, DeepTech has fulfilled all of its obligations under the Indenture or, if
there has been a default, specifying each default, its nature and its status. In
addition, DeepTech is required to file with the Trustee notice of the occurrence
of any Default or Event of Default within five Business Days of its becoming
aware of any such Default or Event of Default.
DISCHARGE OF INDENTURE AND DEFEASANCE
DeepTech may terminate substantially all its obligations under the Senior
Notes and the Indenture and the Indenture shall cease to be of further effect
(subject to the survival of certain provisions thereof) when (i) all outstanding
Senior Notes (other than certain Senior Notes replaced pursuant to the
Indenture) have been delivered to the Trustee for cancellation or (ii) all
outstanding Senior Notes have become due and payable, and DeepTech irrevocably
deposits with the Trustee funds sufficient to pay at maturity or redemption all
outstanding Senior Notes (other than certain Senior Notes replaced pursuant to
the Indenture), including all interest and premium (if any) thereon, and
DeepTech has paid all other sums then due and payable under the Indenture. In
addition, DeepTech may terminate substantially all its obligations under the
Senior Notes and the Indenture if (a) DeepTech irrevocably deposits in trust
with the Trustee cash in United States dollars or U.S. Government Obligations
maturing as to principal and interest in such amounts and at such times, or a
combination of money and U.S. Government Obligations as are sufficient, based
upon the written report of a
11
<PAGE> 13
nationally recognized firm of independent public accountants, to pay the
principal of, and premium, if any, on and interest on the then outstanding
Senior Notes to Stated Maturity, repurchase or redemption, as the case may be,
(b) DeepTech delivers to the Trustee an Opinion of Counsel to the effect that,
based on federal income tax laws then in effect, the Holders of the Senior Notes
will not recognize income, gain or loss for federal income tax purposes as a
result of DeepTech's exercise of such option and shall be subject to federal
income tax on the same amounts and in the same manner and at the same times as
would have been the case if such option had not been exercised, or a ruling to
that effect has been received from or published by the Internal Revenue Service
and (c) certain other conditions are met.
DeepTech shall be released from its obligations with respect to the
covenants described under "Certain Covenants" and payment of the Senior Notes
may not be accelerated because of an Event of Default based on the failure to
comply with such covenants or because of an Event of Default described in
clauses (iii), (iv) or (v), in the first paragraph under "Events of Default," if
(i) DeepTech irrevocably deposits in trust with the Trustee trust money or U.S.
Government Obligations sufficient, based upon the written report of a nationally
recognized firm of independent public accountants, to pay the principal of, and
premium on, if any, and interest on the then-outstanding Senior Notes to Stated
Maturity, repurchase or redemption, as the case may be, and (ii) certain other
conditions are met. In such event, the obligations of DeepTech under the Senior
Notes and the Indenture (other than with respect to the covenants and Events of
Default referred to above) shall remain in full force and effect.
REPORTS TO HOLDERS OF THE SENIOR NOTES
DeepTech will, within five Business Days, file with the Trustee and
promptly furnish Holders with copies of the annual reports and of the
information, documents and other reports that DeepTech is required to file with
the Commission pursuant to Section 13 or 15(d) of the Exchange Act after such
annual reports, information, documents and other reports are filed with the
Commission.
TRANSFER AND EXCHANGE
A Holder may transfer or exchange Senior Notes in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents, and DeepTech may require a
Holder to pay any taxes and fees required by law or permitted by the Indenture.
DeepTech is not required to make, and the Registrar is not required to register,
any transfer or exchange of any Senior Note selected for redemption or
repurchase (except, in the case of Senior Notes to be redeemed or repurchased in
part, the portion thereof not to be redeemed or repurchased), or any Senior Note
for a period of 15 days before a selection of Senior Notes to be redeemed or
repurchased, or any Senior Note for a period of 15 days before an interest
payment date.
The registered Holder of a Senior Note may be treated as the owner of it
for all purposes.
AMENDMENT AND SUPPLEMENT
Subject to certain exceptions, the Indenture or the Senior Notes may be
amended or supplemented by DeepTech and the Trustee without notice to any Holder
but with the written consent of the Holders of at least a majority in principal
amount of then-outstanding Senior Notes. Without notice to or consent of any
Holder, DeepTech and the Trustee may amend the Indenture and the Senior Notes,
among other things, to cure any ambiguity, defect or inconsistency; to provide
for the assumption of DeepTech's obligations to Holders by a successor
corporation; to provide for uncertificated Senior Notes in addition to or in
place of certificated Senior Notes (subject to certain provisions of the Code);
or to make any change that would provide additional benefit or rights to the
Holders or that does not adversely affect the rights of any Holder. Without the
consent of each Holder affected, DeepTech may not reduce the principal amount of
Senior Notes the Holders of which must consent to any amendment of the
Indenture; reduce the interest rate or extend the time for payment of interest
on any Senior Note; reduce the premium payable upon the redemption of any Senior
Note or change the time at which any Senior Note may or shall be redeemed; make
any Senior Note payable in money other than that stated in the Senior Note; make
any change in the provisions concerning waiver of
12
<PAGE> 14
Defaults or Events of Default by Holders of the Senior Notes or rights of any
Holder to receive payment of principal or interest; or extend the Stated
Maturity of any Senior Note. The Indenture contains provisions that permit Deep
Tech and the Trustee, with the consent of Holders of at least 51% in aggregate
principal amount of Senior Notes then outstanding, to amend, supplement or
modify the Indenture to modify certain provisions that do not require the
consent of each Holder.
NO PERSONAL LIABILITY OF STOCKHOLDERS, OFFICERS AND DIRECTORS
No director, officer, employee or stockholder of DeepTech shall have any
personal liability in respect of any obligations of DeepTech under the Senior
Notes or the Indenture, or for any claim based on, with respect to or by reason
of such obligation or their creation. By accepting any Note, each Holder shall
waive and release all such liability. The waiver and release shall be part of
the consideration for the issue of the Senior Notes.
THE TRUSTEE
The Bank of New York is the Trustee under the Indenture. The Trustee is
permitted to engage in other transactions; however, if the Trustee acquires any
conflicting interest (as defined in the Trust Indenture Act) it must eliminate
such conflict within 90 days, apply to the Commission to continue or resign.
The Indenture provides that, except during the continuance of an Event of
Default, the Trustee will perform only such duties as are specifically set forth
in the Indenture. During the existence of an Event of Default, the Trustee will
exercise the rights and powers vested in it under the Indenture and use the same
degree of care and skill in their exercise as a prudent Person would exercise
under the circumstances in the conduct of such Person's own affairs.
AUTHENTICATION
Two officers of DeepTech are required to sign each Senior Note on behalf of
DeepTech by manual or facsimile signature. DeepTech's seal is required to be
reproduced on the Senior Notes. A Senior Note is not valid until the Trustee or
an authenticating agent manually signs the certificate of authentication on the
Senior Note. Each Senior Note is required to be dated the date of its
authentication.
DESCRIPTION OF THE GUARANTEES
GENERAL
The Guarantees were executed by the Company on August 14, 1998. A copy of
the Guarantee is filed as an exhibit to the Registration Statement of which this
Prospectus is a part. The Guarantees are offered in uncertificated form, subject
to the satisfaction or waiver of certain conditions described below. See
"Conditions to the Effectiveness of the Guarantee".
The Guarantees provide that the Company unconditionally guarantees that (i)
the Company will promptly and punctually perform and observe each and every
agreement, covenant and condition on the part of DeepTech to be performed or
observed, which agreement, covenant or condition is contained in the Senior
Notes, as amended by the Supplemental Indenture (all of such instruments being
herein collectively called the "Operative Instruments"), (ii) all sums stated in
the Operative Instruments to be payable and all other amounts payable pursuant
to the Operative Instruments, including, without limitation, the principal of,
the interest and any premium on, the Securities, will be promptly paid in full
when due in accordance with the provisions thereof, whether at maturity or as a
prepayment or by acceleration or otherwise, all at the time and place and in the
amount and manner prescribed in, and otherwise in accordance with, the
applicable Operative Instrument, and (iii) the Company will, promptly after
demand, pay to the Holder, the costs and expenses incurred in connection with
enforcing the rights of said Holder against DeepTech following any default in
the due performance or observance of any agreement, covenant or condition on the
part of DeepTech to be
13
<PAGE> 15
performed or observed under any of the Operative Instruments, including without
limitation, the fees and expenses of counsel.
The Guarantees are unconditional and absolute guarantees of payment and not
guarantees of collection, and if for any reason any duty, agreement or
obligation of DeepTech contained in any Operative Instrument is not performed or
observed by DeepTech as provided therein, or if any amount payable under or in
connection with any Operative Instrument is not paid in full when the same
becomes due and payable, the Company undertakes to perform or cause to be
performed promptly each of such duties, agreements and obligations and to pay
forthwith each such amount to the person entitled to receive the same,
regardless of any defense or set-off or counterclaim which DeepTech or any other
person may have or assert and regardless of whether or not the Holder or anyone
on behalf of such Holder shall have instituted any suit, action or proceeding or
exhausted its remedies or taken any steps to enforce any rights against DeepTech
or any other person to compel any such performance or observance or to collect
all or part of any such amount, either pursuant to the provisions of any
Operative Instrument or at law or in equity, and regardless of any other
condition or contingency.
If the Company is required to make any payments on account of the
Securities or otherwise in accordance with any Operative Instrument and pursuant
to the Guarantees, the Company will be subrogated to the rights of the Holder of
the Securities (subject to the prior payment in full in cash of all principal,
interest and premium, if any, due on the Securities and all amounts payable
under the Operative Instruments) to receive payments or distributions of assets
of DeepTech payable or distributable to said Holder until the Company has been
repaid in full. If at any time any payment received by the Holder under any
Operative Instrument is required to be repaid by such Holder, the obligations,
covenants, agreements and duties of the Company under the Guarantees will be
reinstated for not less than one year as if such payment had not been made.
COVENANTS IN THE GUARANTEES
Waiver. The Company unconditionally: (i) waives any requirement that the
Holder, in the event of any default by DeepTech, first make demand upon, or seek
to enforce remedies against, DeepTech or any other person before demanding
payment under or seeking to enforce the Guarantees; (ii) covenants that the
Guarantees will not be discharged except by complete performance of all
obligations contained in every Operative Instrument; (iii) agrees that the
Guarantees will remain in full force and effect without regard to, and will not
be affected or impaired, without limitation, by, any invalidity, irregularity or
unenforceability in whole or in part of any Operative Instrument or any
limitation on the liability of DeepTech thereunder, or any limitation on the
method or terms of payment thereunder which may be caused or imposed in any
manner whatsoever; and (iv) waives diligence, presentment and protest with
respect to, and any notice of default in the payment of any amount at any time
payable by DeepTech under or in connection with, any operative Instrument.
No Impairment of Covenants. The obligations, covenants, agreements and
duties of the Company under the Guarantees will not be released, affected or
impaired by any assignment or transfer, in whole or in part, of any Operative
Instrument, although made without notice to or the consent of the Company, or
any waiver by the Holder, or by any other person, of the performance or
observance by DeepTech or the Company of any of the agreements, covenants, terms
or conditions contained in any Operative Instrument, or any indulgence in or the
extension of the time for payment by DeepTech or the Company of any amounts
payable under or in connection with any Operative Instrument or of the time for
performance by DeepTech or the Company of any other obligations under or arising
out of any Operative Instrument or the extension or renewal thereof, or the
modification or amendment (whether material or otherwise) of any duty, agreement
or obligation of DeepTech or the Company set forth in any Operative Instrument,
or the voluntary or involuntary liquidation, administration, sale or other
disposition of all or substantially all of the assets of DeepTech or the
Company, or any receivership, insolvency, bankruptcy, reorganization, or other
similar proceeding, affecting DeepTech or the Company or any assets of DeepTech
or the Company, or the release or discharge of DeepTech or the Company from the
performance or observance of any agreement, covenant, term or condition
contained in any Operative Instrument by operation of law, or the merger or
consolidation of DeepTech or the Company, or any other cause, whether similar or
dissimilar to the foregoing.
14
<PAGE> 16
Limitation on Sale and Leaseback Transactions. In addition to the foregoing
covenants, the Guarantees contain a covenant which restricts sale and lease-back
transactions. The Guarantees provide that the Company will not, nor will it
permit any Subsidiary to, create, assume, incur or suffer to exist any Mortgage
(as defined below) upon any Principal Property (as defined below), whether owned
or leased on the date of the Guarantees or thereafter acquired, to secure any
Debt (as defined below), of the Company or any other Person (other than the
Senior Notes), without in any such case making effective provision whereby all
of the Senior Notes outstanding will be directly secured equally and ratably
with such Debt, excluding, however, the following: (i) any Mortgage upon
property owned or leased by any corporation existing at the time such
corporation becomes a Subsidiary; (ii) any Mortgage upon property existing at
the time of acquisition thereof; (iii) any Mortgage to secure the payment of all
or any part of the purchase price of property or to secure any Debt incurred
prior to, at the time of or within 180 days after the acquisition of such
property for the purpose of financing all or any part of the purchase price
thereof; (iv) any Mortgage upon property to secure all or any part of the cost
of construction, alteration, repair or improvement of all or any part of such
property, or Debt incurred prior to, at the time of or within 180 days after the
completion of such construction, alteration, repair or improvement or
commencement of full operations on such property for the purpose of financing
all or any part of such cost; (v) any Mortgage securing Debt of a Subsidiary
owing to the Company or to another Subsidiary; (vi) any Mortgage existing at the
date of the Guarantees; and (vii) any extension, renewal or replacement (or
successive extensions, renewals or replacements) in whole or in part of any
Mortgage referred to in the foregoing clauses (i) to (vi), inclusive; provided,
however, that the principal amount of Debt secured thereby shall not exceed the
principal amount of Debt so secured at the time of such extension, renewal or
replacement; and provided, further, that such Mortgage shall be limited to all
or such part of the property which was subject to the Mortgage so extended,
renewed or replaced (plus improvements on such property).
Notwithstanding the provisions described in the preceding paragraph, the
Company may, and may permit any Subsidiary to, create, assume, incur or suffer
to exist any Mortgage upon any Principal Property which would otherwise be
subject to the restrictions described in the preceding paragraph without equally
and ratably securing the Senior Notes, provided that the aggregate amount of all
Debt then outstanding secured by such Mortgage and all similar Mortgages,
together with all net sale proceeds from Sale-Leaseback Transactions (as defined
below) which are not permitted pursuant to clauses (i) and (ii) of the next
paragraph, does not exceed 10% of the total consolidated stockholders' equity of
the Company as shown on the audited consolidated balance sheet contained or
incorporated by reference in the Company's latest Annual Report on Form 10-K.
For the purpose of this paragraph, no Mortgage to secure any Debt will be deemed
to be created by any Mortgage in favor of the United States of America or any
state thereof, or any other country, or any political subdivision of any of the
foregoing, to secure partial, progress, advance or other payments pursuant to
the provisions of any contract or statute, or any Mortgage securing industrial
development, pollution control or similar revenue bonds.
The Company further agrees that it will not, nor will it permit any
Subsidiary to, sell or transfer any Principal Property with the Company or any
Subsidiary taking back a lease of such Principal Property (a "Sale-Leaseback
Transaction"), unless (i) such Sale-Leaseback Transaction occurs within 180 days
from the date of acquisition of such Principal Property or the date of the
completion of construction or commencement of full operations on such Principal
Property, whichever is later, or (ii) the Company, within 120 days after such
Sale-Leaseback Transaction, applies or causes to be applied to the retirement of
Funded Debt of the Guarantor or any Subsidiary (other than Funded Debt of the
Company which by its terms or the terms of the instrument pursuant to which it
was issued is subordinate in right of payment to the Senior Notes) an amount not
less than the net proceeds of the sale of such Principal Property.
Notwithstanding the provisions described in the preceding paragraph, the
Company may, and may permit any Subsidiary to, effect any Sale-Leaseback
Transaction involving any Principal Property, provided that the net sale
proceeds from such Sale-Leaseback Transaction, together with all Debt secured by
Mortgages which would otherwise be subject to the restrictions described in the
first paragraph under the caption "Limitation on Sale and Leaseback
Transactions" does not exceed 10% of the total consolidated stockholders' equity
of the Company as shown on the audited consolidated balance sheet contained or
incorporated by reference in the
15
<PAGE> 17
Company's latest Annual Report on Form 10-K. The provisions of this paragraph
will also not prevent any Sale-Leaseback Transaction involving a lease for a
period, including renewals, of not more than 36 months.
Certain Definitions
The following definitions are applicable to the covenants relating to
Limitation on Sale and Leaseback Transactions:
"Debt" means indebtedness for money borrowed.
"Funded Debt" means all Debt maturing one year or more from the date of the
creation thereof, all Debt directly or indirectly renewable or extendible, at
the option of the debtor, by its terms or by the terms of any instrument or
agreement relating thereto, to a date one year or more from the date of the
creation thereof, and all Debt under a revolving credit or similar agreement
obligating the lender or lenders to extend credit over a period of one year or
more.
"Mortgage" means and includes any mortgage, pledge, lien, charge, security
interest, conditional sale or other title retention agreement or other similar
encumbrance.
"Principal Property" means (i) any pipeline assets of the Company or any
Subsidiary, including any related facilities employed in the transportation,
distribution or marketing of natural gas, and (ii) any processing or
manufacturing plant owned or leased by the Company or any Subsidiary and located
within the United States of America or any state thereof or the Dominion of
Canada or any province or territory thereof, except any such assets or plant
which in the opinion of the Board of Directors of the Company are not Principal
Properties in relation to the activities of the Company and its Subsidiaries as
a whole.
Reinstatement; Amendment
If at any time any payment received by the Holder under any Operative
Instrument is required to be repaid by such Holder, the obligations, covenants,
agreements and duties of the Company under the Guarantees will be reinstated for
not less than one year as if such payment had not been made.
The Guarantees may not be amended or modified except by a writing executed
by the Company with the written consent of the Holder executed thereon. The
obligations of the Company under the Guarantees are continuing obligations and a
fresh cause of action will arise in respect of each default thereunder.
Record Holders of the Senior Notes will receive a copy of the Guarantee
from the Bank of New York, successor in interest to the First Interstate Bank of
Texas, N.A., as Trustee (the "Trustee"), under the Indenture dated as of March
21, 1994, as amended, between DeepTech and the Trustee (the "Indenture"). It
will not be necessary for new certificates evidencing the Senior Notes to be
issued.
ISSUANCE OF GUARANTEES TO HOLDERS
As a result of a holding company reorganization effected on August 1, 1998,
EPNG became a wholly owned subsidiary of El Paso Energy and El Paso Energy
succeeded EPNG as the publicly traded corporation. In conjunction with the
Merger of DeepTech with EPNG or El Paso Energy pursuant to the Agreement and
Plan of Merger dated as of February 27, 1998, as amended, and the Solicitations
of the Waivers and the Amendments, EPNG agreed that EPNG or El Paso Energy, as
successor to EPNG, would guarantee the Securities and would register the resales
of such Guarantees under the Securities Act, if the Merger were effected between
DeepTech and a subsidiary of El Paso Energy. Based upon elections made by
stockholders of DeepTech, on August 14, 1998 the Merger was effected as a merger
of a subsidiary of El Paso Energy into DeepTech, and El Paso Energy issued the
Guarantees on that date. The Registration Statement of which this Prospectus
forms a part is being filed to permit the resale under the Securities Act of the
Securities as well as the resale of the Guarantees.
16
<PAGE> 18
This Prospectus does not constitute part of the Solicitations, which were
effected by, and fully described in, the Statement, the Consent Letter and the
other documents relating to the Solicitations that have been delivered by EPNG
and El Paso Energy to the Holders. This Prospectus relates solely to resales by
the Selling Holders of the Guaranteed Securities.
PLAN OF DISTRIBUTION
The Selling Holders may only sell the Guarantees in conjunction with the
sale of the associated Senior Notes. The Selling Holders may sell or distribute
some or all of the Guaranteed Securities from time to time through dealers or
brokers or other agents or directly to one or more purchasers in privately
negotiated transactions or in the over-the-counter market, or in brokerage
transactions, or in a combination of such transactions. Such transactions may be
effected by the Selling Holders at market prices prevailing at the time of sale,
at prices related to such prevailing market prices, at negotiated prices, or at
fixed prices, which may be changed. Brokers, dealers or other agents
participating in such transactions as agent may receive compensation in the form
of discounts, concessions or commissions from Selling Holders (and, if they act
as agent for the purchaser of such shares, from such purchaser). Such discounts,
concessions or commissions as to a particular broker, dealer, or other agent
might be in excess of those customary in the type of transaction involved.
The Selling Holders and any such brokers, dealers or other agents that
participate in such distribution may be deemed to be "underwriters" within the
meaning of the Securities Act, and any discounts, commissions or concessions
received by any such brokers, dealers or other agents might be deemed to be
underwriting discounts and commissions under the Securities Act. Neither the
Company nor the Selling Holders can presently estimate the amount of such
compensation. The Company knows of no existing arrangements between any Selling
Holder and any other Selling Holder, broker, dealer or other agent relating to
the sale or distribution of the Guaranteed Securities.
Under applicable rules and regulations under the Exchange Act, any person
engaged in a distribution of any of the Guaranteed Securities may not
simultaneously engage in market activities with respect to the Guaranteed
Securities for the applicable period under Regulation M prior to the
commencement of such distribution. In addition and without limiting the
foregoing, the Selling Holders will be subject to applicable provisions of the
Exchange Act and the rules and regulations thereunder, including without
limitation Rule 10b-5, which provisions may limit the timing of purchases and
sales of any of the Guaranteed Securities by the Selling Holders. All of the
foregoing may affect the marketability of the Guaranteed Securities.
The Company will pay substantially all of the expenses incident to this
offering of the Guaranteed Securities by the Selling Holders to the public other
than commissions, concessions and discounts of brokers, dealers or other agents.
Each Selling Holder may indemnify any broker, dealer, or other agent that
participates in transactions involving sales of the Guaranteed Securities
against certain liabilities, including liabilities arising under the Securities
Act. The Company may agree to indemnify the Selling Holders and any such
statutory "underwriters" and controlling persons of such "underwriters" against
certain liabilities, including certain liabilities under the Securities Act.
In order to comply with certain states' securities laws, if applicable, the
Guaranteed Securities will be sold in such jurisdictions only through registered
or licensed brokers or dealers.
The Company has agreed to maintain the effectiveness of this Registration
Statement for a period of one year after the Effective Time of the Merger. No
sales may be made pursuant to this Prospectus after such date unless the Company
amends or supplements this Prospectus to indicate that it has agreed to extend
such period of effectiveness. There can be no assurance that the Selling Holders
will sell all or any of the Guaranteed Securities.
17
<PAGE> 19
SELLING HOLDERS
The following table sets forth certain information with respect to the
Selling Holders:
<TABLE>
<CAPTION>
AGGREGATE PRINCIPAL
AMOUNT OWNED PRIOR
NAME OF SELLING HOLDER TO THE OFFERING PERCENT
---------------------- ------------------- -------
AMOUNT
(IN THOUSANDS)
<S> <C> <C>
Davis High Income Fund..................................... $ 500 *
Donaldson, Lufkin & Jenrette Securities Corporation(1)..... 26,110 31.84%
Dreyfus Variable Limited Term High Income Fund............. 450 *
Dreyfus Short Term High Yield.............................. 2,800 3.41%
Dreyfus Premier Limited Term High Income................... 4,850 5.91%
Global Horizons Investment Series: Diversified Strategic
Income Fund.............................................. 125 *
Greenwich Street Series: Diversified Strategic Income
Portfolio................................................ 150 *
Harvard Management Company Inc............................. 2,000 2.44%
Lehman Brothers Inc........................................ 4,000 4.9%
Sirach Capital Management Inc.............................. 20,750 25.30%
Smith Barney Diversified Strategic Income Portfolio........ 3,200 3.9%
Smith Barney Managed High Income Fund...................... 2,315 2.82%
Smith Barney High Income Opportunity Fund.................. 3,950 4.82%
Smith Barney High Income Bond Fund......................... 5,400 6.59%
Smith Barney/Travelers High Income Portfolio............... 750 *
Smith Barney USA High Yield Fund........................... 250 *
</TABLE>
- ---------------
* Less than 1%
(1) Donaldson, Lufkin & Jenrette Securities has an investment banking
relationship with El Paso Energy and in the past three years has acted as a
financial advisor to El Paso Energy and its affiliates as a managing
underwriter of various securities offerings on behalf of El Paso Energy and
its affiliates, for which it received customary fees.
LEGAL OPINIONS
The legality of the Guaranteed Securities will be passed upon for the
Company and DeepTech by Fried, Frank, Harris, Shriver & Jacobson (a partnership
including professional corporations).
EXPERTS
The consolidated financial statements and the financial statement schedules
of EPNG as of December 31, 1997 and 1996, and for each of the three years in the
period ended December 31, 1997, incorporated by reference in this Registration
Statement, have been incorporated herein in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given upon the authority of
such firm as experts in accounting and auditing. The consolidated financial
statements of (i) each of DeepTech and Leviathan Gas Pipeline Company as of June
30, 1997 and 1996 and for each of the three years in the period ended June 30,
1997, (ii) Leviathan as of December 31, 1997 and 1996 and for each of the three
years in the period ended December 31, 1997 and (iii) Viosca Knoll Gathering
Company as of December 31, 1997 and 1996 and for each of the two years in the
period ended December 31, 1997, have been incorporated by reference herein in
reliance on the reports of PricewaterhouseCoopers LLP, independent accountants,
given on the authority of said firm as experts in accounting and auditing.
The financial statements of High Island Offshore System as of December 31,
1997 and 1996 and for each of the two years in the period ended December 31,
1997 incorporated in this Prospectus by reference from Leviathan's Annual Report
on Form 10-K for the year ended December 31, 1997 have been audited by
18
<PAGE> 20
Deloitte & Touche LLP, independent auditors, as stated in their report, which is
incorporated herein by reference, and have been so incorporated in reliance upon
the report of such firm given upon their authority as experts in accounting and
auditing.
The financial statements of Poseidon Oil Pipeline Company, L.L.C. as of
December 31, 1997 and 1996 and for the year ended December 31, 1997 and the
period from inception (February 14, 1996) through December 31, 1996 have been
incorporated by reference herein from Leviathan's Annual Report on Form 10-K for
the year ended December 31, 1997 in reliance on the report of Arthur Andersen
LLP, independent public accountants, given upon the authority of such firm as
experts in accounting and auditing.
The oil and gas reserves data, as of June 30, 1997, of Leviathan and Tatham
Offshore have been incorporated by reference herein and in the Registration
Statement from DeepTech's Annual Report on Form 10-K/A for the year ended June
30, 1997 in reliance on the reports, Tatham Offshore, Inc., Estimated Net
Reserves and Income Data Attributable to Certain Leasehold and Royalty
Interests, dated as of June 30, 1997, of Ryder Scott Company Petroleum Engineers
and the reserve report of Netherland, Sewell & Associates, Inc., each, an
independent petroleum engineering consulting firm, given upon the authority of
such firms as experts in petroleum engineering.
The oil and gas reserve data, as of December 31, 1997, of Leviathan have
been incorporated by reference herein and in the Registration Statement from
DeepTech's Annual Report on Form 10-K/A for the year ended June 30, 1997 and
from Leviathan's Annual Report on Form 10-K for the year ended December 31, 1997
in reliance on the reserve report of Netherland, Sewell & Associates, Inc., and
independent petroleum engineering consulting firm, given upon the authority of
such firm as experts in petroleum engineering.
19
<PAGE> 21
- ------------------------------------------------------------
- ------------------------------------------------------------
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER
CONTAINED IN THE PROSPECTUS AND IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY.
NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER
ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATES AS OF WHICH INFORMATION IS GIVEN IN THIS
PROSPECTUS. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR SOLICITATION BY
ANYONE IN ANY STATE IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN
WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO OR
TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER
TO BUY ANY SECURITIES OTHER THAN THE SECURITIES TO WHICH IT RELATES.
---------------------
TABLE OF CONTENTS
<TABLE>
<S> <C>
Available Information....................... 2
Private Securities Litigation Reform Act
Safe Harbor Statement..................... 3
Documents Incorporated by Reference......... 3
The Companies............................... 5
Use of Proceeds............................. 6
Description of the Senior Notes............. 7
Description of the Guarantees............... 13
Issuance of Guarantees to Holders........... 16
Plan of Distribution........................ 17
Selling Holders............................. 18
Legal Opinions.............................. 18
Experts..................................... 18
</TABLE>
- ------------------------------------------------------------
- ------------------------------------------------------------
- ------------------------------------------------------------
- ------------------------------------------------------------
DEEPTECH INTERNATIONAL INC.
$77,600,000 12% SENIOR NOTES
DUE 2000
FULLY AND UNCONDITIONALLY
GUARANTEED BY
EL PASO ENERGY
CORPORATION
------------------------
PROSPECTUS
------------------------
MARCH 8, 1999
- ------------------------------------------------------------
- ------------------------------------------------------------
<PAGE> 22
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses in connection with the issuance and distribution of
the securities being registered, other than underwriting compensation, are as
follows. All of such expenses will be paid for by El Paso Energy Corporation.
<TABLE>
<S> <C>
S.E.C. Registration Fee..................................... $27,421
Legal Fees and Expenses..................................... 25,000
Accounting Fees and Expenses................................ 5,000
Printing Fees............................................... 5,000
Miscellaneous............................................... 6,282
-------
$70,000
=======
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law provides that a
corporation may indemnify directors and officers as well as other employees and
individuals against expenses (including attorneys' fees), judgments, fines, and
amounts paid in settlement in connection with specified actions, rules, or
proceedings, whether civil, criminal, administrative, or investigative (other
than action by or in the right of the corporation -- a "derivative action"), if
they acted in good faith and in a manner they reasonably believed to be in or
not opposed to the best interests of the corporation and, with respect to any
criminal action or proceeding, had no reasonable cause to believe their conduct
was unlawful. A similar standard is applicable in the case of derivative
actions, except that indemnification only extends to expenses (including
attorneys' fees) incurred in connection with the defense or settlement of such
action, and the statute requires court approval before there can be any
indemnification where the person seeking indemnification has been found liable
to the corporation. The statute provides that it is not exclusive of other
indemnification that may be granted by a corporation's charter, by-laws,
disinterested director vote, stockholder vote, agreement, or otherwise.
Article X of El Paso Energy's By-laws requires indemnification to the full
extent permitted under Delaware law as from time to time in effect. Subject to
any restrictions imposed by Delaware law, the By-laws of El Paso Energy provide
an unconditional right to indemnification for all expense, liability, and loss
(including attorneys' fees, judgments, fines, ERISA excise taxes, or penalties
and amounts paid in settlement) actually and reasonably incurred or suffered by
any person in connection with any actual or threatened proceeding (including, to
the extent permitted by law, any derivative action) by reason of the fact that
such person is or was serving as a director, officer, or employee of El Paso
Energy or that, being or having been such a director or officer or an employee
of El Paso Energy, such person is or was serving at the request of El Paso
Energy as a director, officer, employee, or agent of another corporation,
partnership, joint venture, trust, or other enterprise, including an employee
benefit plan. The By-laws of El Paso Energy also provide that El Paso Energy
may, by action of its Board of Directors, provide indemnification to its agents
with the same scope and effect as the foregoing indemnification of directors and
officers.
Article VI of DeepTech's By-laws requires indemnification to the full
extent authorized by law of any person made or threatened to be made a party to
any action, suit or proceeding, whether criminal, civil, administrative or
investigative, by reason of the fact that he is or was a director, officer or
employee of DeepTech or any predecessor of DeepTech or served any other
enterprise as a director, officer or employee at the request of DeepTech or any
predecessor of DeepTech.
Section 102(b)(7) of the Delaware General Corporation Law permits a
corporation to provide in its certificate of incorporation that a director of
the corporation shall not be personally liable to the corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability for (i) any breach of the director's duty of loyalty to the
corporation or its stockholders, (ii) acts or omissions not in good
II-1
<PAGE> 23
faith or which involve intentional misconduct or a knowing violation of law,
(iii) payment of unlawful dividends or unlawful stock purchases or redemptions,
or (iv) any transaction from which the director derived an improper personal
benefit.
Article 10 of El Paso Energy's Certificate of Incorporation, as amended,
provides that, to the full extent that the Delaware General Corporation Law, as
it now exists or may hereafter be amended, permits the limitation or elimination
of the liability of directors, a director of El Paso Energy shall not be liable
to El Paso Energy or its stockholders for monetary damages for breach of
fiduciary duty as a director. Any amendment to or repeal of such Article 10
shall not adversely affect any right or protection of a director of El Paso
Energy for or with respect to any acts or omissions of such director occurring
prior to such amendment or repeal.
El Paso Energy maintains directors' and officers' liability insurance which
provides for payment, on behalf of the directors and officers of El Paso Energy
and its subsidiaries (including DeepTech), of certain losses of such persons
(other than matters uninsurable under law) arising from claims, including claims
arising under the Securities Act, for acts or omissions by such persons while
acting as directors or officers of El Paso Energy and/or its subsidiaries, as
the case may be.
ITEM 16. EXHIBITS.
<TABLE>
<C> <S>
2.1* -- Agreement and Plan of Merger (the "Merger Agreement"),
dated as of February 27, 1998, among El Paso Natural Gas
Company, El Paso Acquisition Company and DeepTech
International Inc.
2.2* -- Amendment No. 1 to the Merger Agreement, dated as of June
16, 1998, by and among the Company, El Paso Natural Gas
Company, El Paso Acquisition Company, and DeepTech
International Inc.
4.1** -- Form of Guarantee re: Senior Notes
4.2 -- Form of Indenture (the "Indenture"), dated March 21,
1994, between DeepTech and First Interstate Bank of
Texas, N.A., as Trustee, relating to the Senior Notes
(filed as Exhibit 4.1 to DeepTech's Registration
Statement on Form S-1 File No. 33-73538 and incorporated
herein by reference).
4.3** -- First Supplemental Indenture, dated August 14, 1998
between DeepTech and the Bank of New York, as Trustee, to
the Indenture.
5.1** -- Opinion of Fried, Frank, Harris, Shriver & Jacobson re:
legality
12.1** -- Statement regarding the computation of the ratio of
earnings to fixed charges of El Paso Energy Corporation
23.1 -- Consent of PricewaterhouseCoopers LLP, independent public
accountants of the Company, DeepTech International Inc.,
Leviathan Gas Pipeline Company, Leviathan Gas Pipeline
Partners, L.P. and Viosca Knoll Gathering Company
23.2** -- Consent of Fried, Frank, Harris, Shriver & Jacobson
(included in Exhibit 5.1 to this Registration Statement)
23.3 -- Consent of Deloitte & Touche LLP, independent accountants
of High Island Offshore System
23.4 -- Consent of Arthur Andersen LLP, independent public
accountants of Poseidon Oil Pipeline Company, L.L.C.
23.5 -- Consent of Ryder Scott Company Petroleum Engineers,
Independent Petroleum Engineers
23.6 -- Consent of Netherland, Sewell & Associates, Inc.,
Independent Petroleum Engineers
23.7 -- Consent of Netherland, Sewell & Associates, Inc.,
Independent Petroleum Engineers
25.1** -- Form T-1 Statement of Eligibility and Qualification of
the Bank of New York, as trustee
</TABLE>
- ---------------
* Previously filed with the Company's registration statement on Form S-4,
registration no. 333-49863
** Previously filed with Form S-3 Registration Statement (File No. 333-61039)
II-2
<PAGE> 24
ITEM 17. UNDERTAKINGS.
A. The undersigned Registrants hereby undertake:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(a) To include any prospectus required by Section 10(a)(3) of the
Securities Act;
(b) To reflect in the Prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement; and
(c) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in this Registration Statement;
provided, however, that paragraphs A(1)(a) and A(1)(b) 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 Registrants
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that
are incorporated by reference in the 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 Registrants hereby undertake that, for purposes of
determining any liability under the Securities Act, such filing of the
Registrants' annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
C. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers, and controlling persons of the
Registrants pursuant to the provisions described in Item 15 above, or otherwise,
the Registrants have been advised that in the opinion of the 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 Registrants of expenses
incurred or paid by a director, officer, or controlling person of the
Registrants in the successful defense of any action, suit or proceeding) is
asserted by such director, officer, or controlling person in connection with the
securities being registered, the Registrants will, unless in the opinion of
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by them is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
II-3
<PAGE> 25
DEEPTECH INTERNATIONAL INC. SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Houston, State of Texas, on March 8, 1999.
DEEPTECH INTERNATIONAL INC.
By: *
----------------------------------
William A. Wise
Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates as indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
* Chairman of the Board and Director March 8, 1999
- -----------------------------------------------------
William A. Wise
</TABLE>
II-4
<PAGE> 26
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ H. BRENT AUSTIN Executive Vice President and March 8, 1999
- ----------------------------------------------------- Director (Principal Financial
H. Brent Austin Officer)
* Vice President and Controller March 8, 1999
- ----------------------------------------------------- (Chief Accounting Officer)
Jeffrey I. Beason
* President and Director March 8, 1999
- -----------------------------------------------------
Robert G. Phillips
</TABLE>
* By: /s/ H. BRENT AUSTIN
-------------------------------
H. Brent Austin
Attorney-in-Fact
II-5
<PAGE> 27
EL PASO ENERGY CORPORATION SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Houston, State of Texas, on March 8, 1999.
EL PASO ENERGY CORPORATION
By: *
----------------------------------
William A. Wise
Chairman of the Board, President
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates as indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
* Chairman of the Board, President, March 8, 1999
- ----------------------------------------------------- Chief Executive Officer and
William A. Wise Director
/s/ H. BRENT AUSTIN Executive Vice President and Chief March 8, 1999
- ----------------------------------------------------- Financial Officer (Principal
H. Brent Austin Financial Officer)
* Vice President and Controller March 8, 1999
- ----------------------------------------------------- (Chief Accounting Officer)
Jeffrey I. Beason
* Director March 8, 1999
- -----------------------------------------------------
Byron Allumbaugh
* Director March 8, 1999
- -----------------------------------------------------
Juan Carlos Braniff
</TABLE>
II-6
<PAGE> 28
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
* Director March 8, 1999
- -----------------------------------------------------
James F. Gibbons
* Director March 8, 1999
- -----------------------------------------------------
Ben F. Love
* Director March 8, 1999
- -----------------------------------------------------
Kenneth L. Smalley
* Director March 8, 1999
- -----------------------------------------------------
Malcolm Wallop
*By: /s/ H. BRENT AUSTIN
------------------------------------------------
H. Brent Austin
Attorney-in-Fact
</TABLE>
II-7
<PAGE> 29
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT
------- -------
<C> <S>
2.1* -- Agreement and Plan of Merger (the "Merger Agreement"),
dated as of February 27, 1998, among El Paso Natural Gas
Company, El Paso Acquisition Company and DeepTech
International Inc.
2.2* -- Amendment No. 1 to the Merger Agreement, dated as of June
16, 1998, by and among the Company, El Paso Natural Gas
Company, El Paso Acquisition Company, and DeepTech
International Inc.
4.1** -- Form of Guarantee re: Senior Notes
4.2 -- Form of Indenture (the "Indenture"), dated March 21,
1994, between DeepTech and First Interstate Bank of
Texas, N.A., as Trustee, relating to the Senior Notes
(filed as Exhibit 4.1 to DeepTech's Registration
Statement on Form S-1 File No. 33-73538 and incorporated
herein by reference).
4.3** -- First Supplemental Indenture, dated August 14, 1998
between DeepTech and the Bank of New York, as Trustee, to
the Indenture.
5.1** -- Opinion of Fried, Frank, Harris, Shriver & Jacobson re:
legality
12.1** -- Statement regarding the computation of the ratio of
earnings to fixed charges of El Paso Energy Corporation
23.1 -- Consent of PricewaterhouseCoopers LLP, independent public
accountants of the Company, DeepTech International Inc.,
Leviathan Gas Pipeline Company, Leviathan Gas Pipeline
Partners, L.P. and Viosca Knoll Gathering Company
23.2** -- Consent of Fried, Frank, Harris, Shriver & Jacobson
(included in Exhibit 5.1 to this Registration Statement)
23.3 -- Consent of Deloitte & Touche LLP, independent accountants
of High Island Offshore System
23.4 -- Consent of Arthur Andersen LLP, independent public
accountants of Poseidon Oil Pipeline Company, L.L.C.
23.5 -- Consent of Ryder Scott Company Petroleum Engineers,
Independent Petroleum Engineers
23.6 -- Consent of Netherland, Sewell & Associates, Inc.,
Independent Petroleum Engineers
23.7 -- Consent of Netherland, Sewell & Associates, Inc.,
Independent Petroleum Engineers
25.1** -- Form T-1 Statement of Eligibility and Qualification of
the Bank of New York, as trustee
</TABLE>
- ---------------
* Previously filed with the Company's registration statement on Form S-4,
registration no. 333-49863
** Previously filed with Form S-3 Registration Statement (File No. 333-61039)
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in Amendment No. 2 to
Registration Statement No. 333-61039 of El Paso Energy Corporation and DeepTech
International Inc. on Form S-3 of (i) our report dated March 12, 1998 on our
audits of the consolidated financial statements and financial statement schedule
of El Paso Natural Gas Company as of December 31, 1997 and 1996, and for each of
the three years in the period ended December 31, 1997, which report is included
in the Annual Report on Form 10-K of El Paso Natural Gas Company for the year
ended December 31, 1997, (ii) our reports dated September 19, 1997 on our audits
of the consolidated financial statements of DeepTech International Inc. and its
subsidiaries and Leviathan Gas Pipeline Company as of June 30, 1997 and 1996,
and for each of the three years in the period ended June 30, 1997, which reports
are included in DeepTech International Inc.'s Annual Report on Form 10-K/A for
the year ended June 30, 1997, (iii) our report dated March 2, 1998 on our audits
of the consolidated financial statements of Leviathan Gas Pipeline Partners,
L.P. as of December 31, 1997 and 1996, and for each of the three years in the
period ended December 31, 1997, which report is included in Leviathan Gas
Pipeline Partners, L.P.'s Annual Report on Form 10-K for the year ended December
31, 1997, and (iv) our report dated March 2, 1998 on our audits of the
consolidated financial statements of Viosca Knoll Gathering Company as of
December 31, 1997 and 1996, and for the years then ended, which report is
included in Leviathan Gas Pipeline Partners, L.P.'s Annual Report on Form 10-K
for the year ended December 31, 1997. We also consent to the reference to our
firm under the caption "Experts."
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Houston, Texas
March 4, 1999
<PAGE> 1
EXHIBIT 23.3
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Amendment No. 2 to
Registration Statement No. 333-61039 of El Paso Energy Corporation and DeepTech
International Inc. on Form S-3 of our report dated February 18, 1998 relating
to the financial statements of High Island Offshore System as of December 31,
1997 and 1996 and for the years then ended, appearing in the Annual Report on
Form 10-K of Leviathan Gas Pipeline Partners, L.P. for the year ended December
31, 1997 and to the reference to us under the heading "Experts" in the
Prospectus, which is part of this Registration Statement.
/s/ DELOITTE & TOUCHE LLP
Detroit, Michigan
March 3, 1999
<PAGE> 1
EXHIBIT 23.4
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this Registration Statement on Form S-3 of our report dated
February 20, 1998 relating to the financial statements of Poseidon Oil Pipeline
Company, L.L.C., as of December 31, 1997 and 1996 and for the year ended
December 31, 1997 and the period from inception (February 14, 1996) through
December 31, 1996, which report is included in Leviathan Gas Pipeline Partners,
L.P.'s Annual Report on Form 10-K for the year ended December 31, 1997, and to
all references to our Firm included in this Form S-3.
/s/ ARTHUR ANDERSEN LLP
Denver, Colorado
March 3, 1999
<PAGE> 1
EXHIBIT 23.5
CONSENT OF RYDER SCOTT COMPANY PETROLEUM ENGINEERS
We hereby consent to the incorporation by reference into this Registration
Statement on Form S-3 of El Paso Energy Corporation and DeepTech International
Inc., and any and all amendments thereto (pre and post-effective) filed after
the date hereof, of our report, Tatham Offshore, Inc., Estimated Net Reserves
and Income Data Attributable to Certain Leasehold and Royalty Interests, dated
as of June 30, 1997, and all references to our report and our firm appearing in
the First Amendment to the Annual Report on Form 10-K/A of DeepTech
International Inc. for the fiscal year ended June 30, 1997 incorporated by
reference in this Form S-3. We also consent to the reference to us under the
heading "Experts" in this Registration Statement.
/s/ Ryder Scott Company
Petroleum Engineers
RYDER SCOTT COMPANY
PETROLEUM ENGINEERS
Houston, Texas
February 26, 1999
<PAGE> 1
EXHIBIT 23.6
CONSENT OF INDEPENDENT PETROLEUM ENGINEERS AND GEOLOGISTS
We hereby consent to the incorporation by reference in this Amendment
No. 2 to the Registration Statement on Form S-3 of our reserve report dated as
of June 30, 1997, and to all references to our firm appearing in the First
Amendment to the Annual Report on Form 10-K/A of DeepTech International Inc. for
the fiscal year ended June 30, 1997 incorporated by reference in this Amendment
No. 2 to Form S-3. We also consent to the reference to us under the heading
"Experts" in this Amendment No. 2 to Form S-3.
NETHERLAND, SEWELL & ASSOCIATES, INC.
By: /s/ FREDERIC D. SEWELL
----------------------------
Frederic D. Sewell
President
Dallas, Texas
March 3, 1999
<PAGE> 1
EXHIBIT 23.7
CONSENT OF INDEPENDENT PETROLEUM ENGINEERS AND GEOLOGISTS
We hereby consent to the incorporation by reference in this Amendment
No. 2 to the Registration Statement on Form S-3 of our reserve report dated as
of December 31, 1997, and to all references to our firm appearing in the Annual
Report on Form 10-K of Leviathan Gas Pipeline Partners, L.P. for the fiscal year
ended December 31, 1997 incorporated by reference in this Amendment No. 2 to
Form S-3. We also consent to the reference to us under the heading "Experts" in
this Amendment No. 2 to Form S-3.
NETHERLAND, SEWELL & ASSOCIATES, INC.
By: /s/ FREDERIC D. SEWELL
----------------------------
Frederic D. Sewell
President
Dallas, Texas
March 3, 1999
