<PAGE> 1
As filed with the Securities and Exchange Commission on June 26, 1995.
Registration No. 33-_________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
______________________
SOUTHERN MINERAL CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
NEVADA 36-2068676
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
17001 NORTHCHASE, SUITE 690
HOUSTON, TEXAS 77060-2138
(713) 872-7621
(Address, including zip code, and telephone number,
including area code, of Registrant's principal
executive offices)
STEVEN H. MIKEL
17001 NORTHCHASE, SUITE 690
HOUSTON, TEXAS 77060-2138
(713) 872-7621
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
With copies to:
T. WILLIAM PORTER
OR NORA J. DOBIN
PORTER & HEDGES, L.L.P.
700 LOUISIANA, SUITE 3500
HOUSTON, TEXAS 77002-2764
(713) 226-0600
______________________
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after the Registration Statement becomes effective.
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/
<TABLE>
CALCULATION OF REGISTRATION FEE
========================================================================================================================
<CAPTION>
PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF AMOUNT TO OFFERING PRICE AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED BE REGISTERED PER UNIT OFFERING PRICE(1) FEE(1)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 par value 3,062,797 shares $.9375 $2,871,372 $990
========================================================================================================================
</TABLE>
(1) Pursuant to Rule 457(c), the registration fee is calculated on the basis
of the last sale price for the Common Stock on the NASDAQ SmallCap Market
on June 21, 1995, $.9375 per share.
____________________
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 THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION ACTING PURSUANT TO SAID SECTION 8(a)
MAY DETERMINE.
================================================================================
<PAGE> 2
***************************************************************************
* *
* INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. *
* A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED *
* WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY *
* NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE *
* REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT *
* CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY *
* NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH *
* SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO *
* REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH *
* STATE. *
* *
***************************************************************************
PROSPECTUS SUBJECT TO COMPLETION, DATED JUNE 26, 1995
3,062,797 SHARES
SOUTHERN MINERAL CORPORATION
COMMON STOCK
________________
The shares of common stock offered hereby are shares of common stock, par
value $.01 per share ("Common Stock"), of Southern Mineral Corporation, a
Nevada corporation (the "Company"), owned by certain stockholders of the
Company. See "Selling Stockholders" and "Description of Securities." The
Company will not receive any of the proceeds from the sale of the Common Stock
offered hereby.
The Company's Common Stock trades on the NASDAQ SmallCap Market under the
symbol "SMIN." On June 21, 1995, the reported closing sale price of the Common
Stock on the NASDAQ SmallCap Market was $.9375 per share.
The Common Stock may be offered and sold from time to time by Selling
Stockholders through brokers or dealers or directly to one or more purchasers
in negotiated transactions, at market prices prevailing at the time of sale or
at prices related to such market prices. The Selling Stockholders and brokers
executing selling orders on behalf of the Selling Stockholders may be deemed to
be "underwriters" within the meaning of the Securities Act of 1933, as amended
("Securities Act"), in which event commissions received by such brokers may be
deemed to be underwriting commissions under the Securities Act. Although each
Selling Stockholder may sell all or a portion of the shares of Common Stock
offered hereby, no Selling Stockholder is required to make any such sale.
Selling Stockholders who are affiliates of the Company have advised the
Company that they do not presently intend to sell the shares of Common Stock
offered hereby, but that such intentions are subject to change at any time for
any reason. Such Selling Stockholders have agreed with the Company that they
will not sell the shares of Common Stock offered hereby before expiration of
the Company's pending odd-lot tender offer, currently scheduled to expire on
August 31, 1995. See "Plan of Distribution" for further information
concerning the plan of distribution of the Common Stock.
The expenses of this offering, estimated at $32,500, will be paid by the
Company.
PROSPECTIVE PURCHASERS OF THE COMMON STOCK OFFERED HEREBY SHOULD CAREFULLY
CONSIDER THE MATTERS SET FORTH UNDER THE CAPTION "CERTAIN RISKS."
________________
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 JUNE , 1995.
<PAGE> 3
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") in Washington, D.C., a Registration Statement on Form S-3 under
the Securities Act with respect to the Common Stock offered by this Prospectus.
Certain portions of the Registration Statement have not been included in this
Prospectus. For further information, reference is made to the Registration
Statement and the Exhibits thereto. The Company is subject to the information
requirements of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and in accordance therewith files reports, proxy statements and other
information with the Commission. The Registration Statement (with exhibits),
as well as such reports, proxy statements and other information can be
inspected and copied at the public reference facilities maintained by the
Commission at its principal offices at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549, and its regional offices at Northwest Atrium Center,
500 Madison Street, Suite 1400, Chicago, Illinois 60661 and 7 World Trade
Center, 13th Floor, New York, New York 10048. Copies of such material can be
obtained at prescribed rates from the Public Reference Section of the
Commission at its principal office at Judiciary Plaza, 450 Fifth Street, N.W.,
Room 1024, Washington, D.C. 20549.
The Company provides its security holders an annual report containing
audited financial statements for the fiscal year covered thereby. Such report
usually is provided within 120 days after the end of the Company's most recent
fiscal year.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's (i) annual report on Form 10-K for the fiscal year ended
December 31, 1994, (ii) quarterly report on Form 10-QSB for the fiscal quarter
ended March 31, 1995, (iii) current report on Form 8-K dated January 5, 1995,
(iv) current report on Form 8-K dated March 2, 1995, (v) current report on
Form 8-K dated April 6, 1995, as amended by Amendment No. 1 on Form 8-K/A
dated April 6, 1995, and (vi) current report on Form 8-K dated June 9, 1995,
are hereby incorporated herein by reference.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Exchange Act after the date of this Prospectus and before the
termination of the offering covered hereby shall be deemed to be incorporated
by reference in this Prospectus and to be a part hereof from the date of filing
of such documents. Any statement contained in this Prospectus, in any
supplement to this Prospectus or in a document incorporated or deemed to be
incorporated by reference in this Prospectus shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained in this Prospectus or in any other subsequently filed document which
also is or is deemed to be incorporated by reference modifies or replaces such
statement. Any such statement 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 to whom this
Prospectus is delivered, upon the written or oral request of such person, a
copy of any or all of the documents incorporated by reference in this
Prospectus, other than exhibits to such documents, unless such exhibits are
specifically incorporated by reference into the information that this
Prospectus incorporates. In addition, a copy of the Company's most recent
annual report on Form 10-K or Form 10-KSB, as the case may be, will be promptly
furnished, without charge, upon written or oral request. All such requests
should be directed to Southern Mineral Corporation, 17001 Northchase, Suite
690, Houston, Texas 77060, Attention: Corporate Secretary, telephone number
(713) 872-7621.
2
<PAGE> 4
THE COMPANY
Southern Mineral Corporation, a Nevada corporation (the "Company"), was
organized in 1937 and acquires, explores for, develops and produces oil and
natural gas. Its production primarily is in Arkansas, Oklahoma, Texas and
other Gulf Coast States, and the Gulf of Mexico. The Company currently does
not operate any of its production, but participates as a working interest owner
in wells drilled and operated by third parties. The Company's executive
offices are located at 17001 Northchase, Suite 690, Houston, Texas 77060,
telephone number (713) 872-7621.
CERTAIN RISKS
Prospective purchasers should carefully consider the following factors.
OPERATING LOSSES
The Company has incurred losses from operations of $1,312,000, $1,531,000,
$881,000 and $3,691,000 for each of its fiscal years ended December 31, 1991,
1992, 1993 and 1994, respectively. No assurance can be made that the Company
will operate profitably in the future. The likelihood of the Company's future
profitability must be considered in light of the business and operating risks,
expenses, difficulties, and delays frequently encountered in connection with
the oil and gas acquisition, exploration, development and production business
in which the Company is engaged. The financial statements incorporated by
reference herein do not include any adjustments that may result from these
uncertainties.
REPLACEMENT OF RESERVES
The Company must continually acquire, explore for and develop new oil and
gas reserves to replace those being depleted by production. Without successful
reserve acquisitions or drilling operations, the Company's assets, properties
and revenues will continue to decline.
ACQUISITION RISKS
Although the Company is actively engaged in evaluating and negotiating
reserve acquisition opportunities, there can be no assurance that the Company
will be successful in acquiring any additional material property interests.
The rate at which the Company is able to sustain any future growth may be
limited to the extent that it requires and is unable to obtain suitable
financing or timely expand its existing staff and operating capabilities. The
business of purchasing producing oil and gas properties is an inherently
speculative activity that involves a high degree of business and financial
risk. Property acquisition decisions generally are based on various
assumptions and subjective judgments which are speculative. If the Company
over-estimates the potential oil and gas reserves of a property to be acquired
or if subsequent operations on the property are unsuccessful, then acquisition
of the property could result in substantial losses to the Company.
UNCERTAINTY OF RESERVE ESTIMATES
The Company's property acquisition activities are based in part on
available geological, geophysical, production and engineering data, the extent,
quality and reliability of which varies. Oil and gas reserve estimates and the
discounted present value estimates associated therewith are based on numerous
engineering, geological and operational assumptions that generally are derived
from limited data. Common assumptions include such matters as the areal extent
and average thickness of a particular reservoir, the average porosity and
permeability of the reservoir, the anticipated future production from existing
and future wells, future development and production costs, and the ultimate
hydrocarbon recovery percentage. In addition, estimates of future net revenue
and the present value thereof typically are based on recent period-ended
prices. As a result, oil and gas reserve estimates and the discounted present
value estimates associated therewith frequently are revised in subsequent
periods to reflect actual prices and production data obtained after the date of
the original estimate. Actual oil and gas production may vary considerably
from anticipated results. If reserve estimates are inaccurate, production
rates may decline more rapidly than anticipated and future production revenues
may be less than anticipated. Moreover, significant downward revision of
reserve estimates may adversely affect the Company's borrowing power or have an
adverse impact on
3
<PAGE> 5
other financing arrangements. Further, if the estimates of quantities, prices
and costs prove inaccurate, the Company is unsuccessful in expanding its oil
and gas reserve base, and/or declines in oil and gas prices occur, then
writedowns in the capitalized costs associated with the Company's oil and gas
assets may be required.
NEED FOR ADDITIONAL CAPITAL
The oil and gas industry is capital intensive. The Company's ability to
expand its reserve base is dependent upon the availability of internally
generated cash flow and financing alternatives. Such financing may consist of
bank or other commercial debt, forward sales of production, equity or debt
securities or any combination thereof. Although the Company currently has no
bank debt or line of credit, it is negotiating a $1,500,000 revolving credit
facility with a commercial bank to be secured by substantially all of the
Company's oil and gas assets and used primarily for property acquisitions.
There can be no assurance that the Company will be successful in obtaining
additional financing if and when required. Any substantial alteration or
increase in the Company's capitalization through the issuance of debt or equity
securities or otherwise may significantly increase the leverage and decrease
the financial flexibility of the Company. Due to uncertainties respecting the
availability of suitable properties, purchase terms, and other matters
associated with any purchase of such properties, the Company is unable to
estimate the amount of any financing that it may need to acquire and develop
additional properties. If the Company is unable to obtain such financing if
and when needed, it will be forced to curtail its contemplated property
acquisition and development activities, and to finance its business activities
with only such internally generated funds as may then be available.
EXPLORATORY DRILLING ACTIVITIES
Exploratory drilling involves a high degree of financial and operating
risk, including the risk that no commercially productive natural gas and oil
reservoirs will be encountered. The cost of drilling, completing and operating
exploratory and development wells often is uncertain. Drilling operations may
be curtailed, delayed or canceled as a result of many factors, including
unexpected formations and drilling conditions, pressure or mechanical
irregularities in formations, equipment failures or accidents, as well as title
problems, weather conditions, compliance with governmental requirements,
shortages or delays in the delivery of equipment, and financial instability of
well operators, major working interest owners and well servicing companies.
The Company plans to remain a non-operator of wells in which it has or acquires
an interest. The Company is dependent upon the operator of such wells to
properly conduct leasing, drilling and completion activities. The operator's
failure to properly perform could adversely affect the Company. The Company's
decision to participate in the drilling of exploratory wells and, ultimately,
the success of the Company's participation depends largely on the results of
seismic survey data and other geological and geophysical data. The acquisition
and interpretation of such data involves subjective professional judgment.
Therefore, reliance of such data and interpretations poses the risk that a
decision to participate in the drilling of a well may be founded on incorrect
data, erroneous interpretations of data, or both.
PRICE VOLATILITY
The revenues generated by the Company are highly dependent upon the prices
of oil and gas. Market conditions make it difficult to estimate future prices
of oil and natural gas. In the past, the Company's average annual sales price
for oil and natural gas has been erratic, and it is likely that oil and gas
prices will continue to fluctuate in the future. Various factors beyond the
Company's control affect prices of oil and natural gas, including worldwide and
domestic supplies of oil and natural gas, the ability of the members of the
Organization of Petroleum Exporting Countries (OPEC) to agree to and maintain
oil price and production controls, political instability or armed conflict in
oil-producing regions, the price of foreign imports, the level of consumer
demand, the price and availability of alternative fuels, the availability of
pipeline capacity and changes in existing federal regulation and price
controls.
MARKETING RISKS
The availability of a ready market for the Company's oil and gas depends
on numerous factors beyond its control, including the demand for and supply of
oil and gas, the proximity of the Company's natural gas reserves to pipelines,
the capacity of such pipelines, fluctuations in production and seasonal demand,
the effects of inclement weather and governmental regulation. New gas wells
may be shut-in for lack of a market until a gas pipeline or
4
<PAGE> 6
gathering system with available capacity is extended into the area. New oil
wells may have production curtailed until production facilities and delivery
arrangements are acquired or developed. The Company's business will always be
subject to these types of risks.
OPERATING HAZARDS AND UNINSURED RISKS
The Company's operations are subject to all of the risks incident to
exploration for and production of oil and gas, including blow-outs, cratering,
pollution and fires, each of which could result in damage to or destruction of
oil and gas wells or production facilities or damage to persons and property.
The Company's insurance may not fully cover certain of these risks and the
occurrence of a significant event not fully insured against could have a
material adverse effect on the Company's financial position.
GOVERNMENTAL REGULATION AND ENVIRONMENTAL RISKS
Exploring for, producing and selling oil and gas are subject to a variety
of federal, state and local government regulations, including regulations
concerning the prevention of waste, the discharge of materials into the
environment, the conservation of natural gas and oil, pollution, permits for
drilling operations, drilling bonds, reports concerning operations, the spacing
of wells, the unitization and pooling of properties, the clean-up of well
sites, and various other matters, including taxes. Laws and regulations
protecting the environment are stringent and may in certain circumstances
impose strict liability, rendering a person liable for environmental damage
without regard to negligence or fault on the part of such person. Such laws
and regulations may expose the Company to liability for the conduct of
operations or conditions caused by others, or for acts of the Company which
were in compliance with all applicable laws at the time such acts were
performed. An increase in federal, state or local production or property
taxes, the modification of existing laws or regulations or the adoption of new
laws or regulations relating to environmental matters could have a material
adverse effect on the Company's operations.
COMPETITION
The oil and gas industry is highly competitive in many respects, including
identification of attractive oil and gas properties for acquisition, drilling
and development, securing financing for such activities and obtaining the
necessary equipment and personnel to conduct such operations and activities.
In seeking suitable opportunities, the Company competes with a number of other
companies, including large oil and gas companies and other independent
operators with greater financial resources and, in some cases, with more
experience. Many other oil and gas companies in the industry have financial
resources, personnel and facilities substantially greater than those of the
Company and there can be no assurance that the Company can compete effectively
with these larger entities.
DEPENDENCE ON KEY PERSONNEL
The loss of the services of any of the Company's officers may adversely
affect the Company's business. The Company's success will be particularly
dependent upon the efforts and active participation of Steven H. Mikel, the
President and Chief Executive Officer of the Company.
DIVIDENDS
The Company does not currently pay cash dividends on its Common Stock and
does not anticipate paying such dividends in the foreseeable future. The
Company's future financing arrangements may restrict the payment of such
dividends. See "Description of Securities."
CONCENTRATION OF OWNERSHIP
The Company's directors and officers currently beneficially own on a
fully-diluted basis approximately 46% of the Company's outstanding Common
Stock. Accordingly, if these stockholders voted together, they could control
or significantly influence the election of the Company's directors and other
matters requiring action by its stockholders.
5
<PAGE> 7
NEVADA TAKEOVER STATUTE
Provisions of Nevada law requiring disinterested director or stockholder
approval of certain business combinations between the Company and holders of
10% or more of its voting securities could have the effect of delaying,
deferring, or preventing a change in control of the Company, and make more
difficult a merger, tender offer or proxy contest involving the Company. See
"Description of Securities."
LIMITATION OF MANAGEMENT LIABILITY
As permitted by Nevada law, the Company's Amended and Restated Articles of
Incorporation allow the Company and its stockholders only equitable remedies
for most breaches of fiduciary duty by its directors and officers. Elimination
of monetary damages as a remedy may discourage litigation against the Company's
directors and officers for such breaches. In addition, equitable remedies may
be ineffective in situations where the only remedy is to enjoin an act or
omission which already has occurred, possibly leaving the Company and its
stockholders with no effective remedy against the subject directors or
officers. See "Description of Securities."
6
<PAGE> 8
SELLING STOCKHOLDERS
The following table sets forth certain information concerning the Selling
Stockholders:
<TABLE>
<CAPTION>
SHARES SHARES TO SHARES TO
NAME AND ADDRESS OWNED(1) BE SOLD(1) BE OWNED
- --------------------------------------------------------------- --------- ---------- ---------
<S> <C> <C> <C>
Venucot, Inc.(2) . . . . . . . . . . . . . . . . . . . . . . . 546,561 546,561 None
B. Travis Basham(3). . . . . . . . . . . . . . . . . . . . . . 62,246 62,246 None
16414 San Pedro, Suite 340
San Antonio, Texas 78232
Michmatt, Inc.(2) . . . . . . . . . . . . . . . . . . . . . . . 546,561 546,561 None
Thomas R. Fuller(3) . . . . . . . . . . . . . . . . . . . . . . 62,246 62,246 None
1111 Fannin, Suite 680
Houston, Texas 77002
DHW Energy, Inc.(2) . . . . . . . . . . . . . . . . . . . . . . 546,561 546,561 None
Donald H. Wiese, Jr.(3) . . . . . . . . . . . . . . . . . . . . 62,246 62,246 None
1111 Fannin, Suite 680
Houston, Texas 77002
Kona, Inc.(2) . . . . . . . . . . . . . . . . . . . . . . . . . 546,561 546,561 None
Spencer L. Youngblood(3) . . . . . . . . . . . . . . . . . . . 62,246 62,246 None
16414 San Pedro, Suite 340
San Antonio, Texas 78232
L. Todd Gremillion . . . . . . . . . . . . . . . . . . . . . . 83,691 83,691 None
1900 Pennzoil Place - South Tower
711 Louisiana
Houston, Texas 77002
Steven H. Mikel(4) . . . . . . . . . . . . . . . . . . . . . . 500,000 500,000 None
17001 Northchase, Suite 690
Houston, Texas 77060
Robert R. Hillery(4) . . . . . . . . . . . . . . . . . . . . . 43,878 43,878 None
13131 Champions Drive, Suite 206
Houston, Texas 77069
TOTALS 3,062,797 3,062,797 None
========= =========
</TABLE>
- ---------------
(1) Includes the following shares of Common Stock which may be acquired by the
indicated stockholder upon exercise of outstanding options: Venucot,
Inc.--69,576, Mr. Basham--7,924, Michmatt, Inc.--69,576, Mr.
Fuller--7,924, DHW Energy, Inc.--69,576, Mr. Wiese--7,924, Kona,
Inc.--69,576, Mr. Youngblood--7,924, and Mr. Gremillion--15,000. These
options may be exercised through April 6, 2000 at $1.25 per share. Also
includes 450,000 shares of Common Stock which may be purchased by Mr.
Mikel through December 28, 2004 and 43,878 shares of Common Stock which
may be purchased by Mr. Hillery through April 6, 2000 at $1.00 per share
upon exercise of outstanding options. The price and number of shares of
Common Stock issuable upon exercise of all these options are subject to
adjustment in certain events, including dividends on, and combinations,
subdivisions or reclassification of, the Common Stock.
(2) A Texas corporation controlled by the individual identified immediately
beneath its name.
(3) A director of the Company since April 6, 1995.
(4) Mr. Mikel has been President and Chief Executive Officer of the Company
since January 1, 1995, and a director of the Company since February 1995.
Mr. Hillery has been a director of the Company since May 1993.
7
<PAGE> 9
The Selling Stockholders other than Messrs. Mikel and Hillery are referred
to as the "DPC Stockholders." The DPC Stockholders acquired the shares of
Common Stock offered hereby on April 6, 1995 pursuant to an Exchange Agreement,
dated March 2, 1995, between SMC Production Co. (formerly named Diverse
Production Co.), a Texas corporation ("DPC"), the DPC Stockholders in their
capacity as DPC's shareholders, and the Company (the "Agreement"). Pursuant to
the Agreement, the Company acquired all of DPC's outstanding capital stock in
consideration for issuing to the DPC Stockholders an aggregate of 2,193,919
shares of Common Stock and options to acquire an additional 325,000 shares of
Common Stock at any time before April 7, 2000 at an exercise price of $1.25 per
share. As part of the transactions contemplated by the Agreement, the Company
agreed to register under the Securities Act the resale of Common Stock acquired
by the DPC Stockholders pursuant thereto. In connection therewith, the Company
and the DPC Stockholders have agreed to indemnify each other against certain
liabilities, including liabilities under the Securities Act.
DPC's primary asset is its 15% general partner interest in Diverse GP III,
a Texas general partnership ("DGP III") which acquires, explores for, develops
and produces oil and natural gas. A non-operator, DGP III's principal assets
are its working and royalty interests in oil and gas properties located in 11
of the continental United States, primarily in Texas, Louisiana and Oklahoma,
and the Gulf of Mexico. DGP III's general partners other than DPC and their
respective general partner interest in DGP III are Selling Stockholders
Venucot, Inc. (20.659% interest), Michmatt, Inc. (20.367% interest), DHW
Energy, Inc. (20.659% interest), Kona, Inc. (20.659% interest), and Mr.
Gremillion (2.656% interest).
The Common Stock offered hereby for the account of Mr. Mikel was issued or
is issuable to him in connection with his acceptance of the Company's offer of
employment in December 1994. The Company granted Mr. Mikel an option to
acquire 450,000 shares of Common Stock at an exercise price of $1.00 on
December 28, 1994 and sold him an additional 50,000 shares of Common Stock at
$.75 per share on January 3, 1995. The average of the high and low trade
prices of a share of Common Stock as reported on the NASDAQ National Market
System on December 28, 1994 was $.594; the high price per share so reported on
January 3, 1995 was $.75. The shares of Common Stock offered hereby for the
account of Mr. Hillery are issuable to him upon his exercise at $1.00 per share
of an option granted to him in April 1995 in connection with his efforts in
initiating the transactions contemplated by the Exchange Agreement.
PLAN OF DISTRIBUTION
All or part of the Common Stock offered hereby may be sold by the Selling
Stockholders from time to time on the NASDAQ SmallCap Market or otherwise at
prices current at the time of sale or at prices related to such market prices,
either directly or through brokers or to dealers, to the extent that such
prices are obtainable and satisfactory to the Selling Stockholders. It is
anticipated that any commissions with respect to such sales will not exceed
regular brokerage commissions. The Selling Stockholders, and brokers executing
selling orders on behalf of the Selling Stockholders and dealers to whom the
Selling Stockholders may sell, may be deemed "underwriters" within the meaning
of the Securities Act. Any profit represented by the excess of the selling
price over the cost of the shares sold in the case of dealers, or any
commission received in the case of brokers, may be deemed to be underwriting
discounts or commissions under the Securities Act.
The Selling Stockholders may sell all or part of the Common Stock offered
hereby pursuant to Rule 144 under the Securities Act.
All Selling Stockholders except Mr. Gremillion have advised the Company
that they do not presently intend to sell the shares of Common Stock offered
hereby, but that such intentions are subject to change at any time for any
reason.
On June 9, 1995, the Company initiated an odd-lot tender offer for shares
of its Common Stock held by holders of less than 100 shares as of March 24,
1995 who collectively own less than 1% of outstanding Common Stock. The
odd-lot tender offer is scheduled to expire on August 31, 1995. All Selling
Stockholders except Mr. Gremillion have agreed with the Company that they will
not sell the Common Stock offered hereby during the pendency of such odd-lot
tender offer.
8
<PAGE> 10
DESCRIPTION OF SECURITIES
COMMON STOCK
The Company's authorized capital stock consists of 10,000,000 shares of
common stock, par value $.01 per share, of which 6,268,340 shares were issued
and outstanding as of May 31, 1995. Outstanding shares of Common Stock are,
and shares of Common Stock offered hereby when issued and paid for will be,
fully paid and nonassessable. Under Nevada law, the Common Stock has no
preemptive rights for so long as the Common Stock remains registered under the
Exchange Act.
Holders of Common Stock are entitled to receive dividends, if, as and when
declared by the board of directors out of funds legally available therefor, and
are entitled on liquidation to share ratably in all assets of the Company
remaining after the payment of liabilities. Since 1994, the Company has
reinvested any earnings in its business and, accordingly, has not paid any
dividends on its Common Stock. Although the Company intends to continue to
invest any future earnings in its business, it may determine to pay cash
dividends in the future. The Company's ability to declare and pay any such
dividends would depend upon, among other things, the earnings and financial
condition of the Company, and restrictive provisions of any financing
arrangements to which the Company may be subject from time to time.
Each share of Common Stock has one vote on all matters presented to the
stockholders. A majority of issued and outstanding shares of Common Stock
entitled to vote and represented at a stockholders meeting in person or by
proxy constitutes a quorum for the transaction of business. The affirmative
vote of a majority of shares present and entitled to vote at a meeting at which
a quorum is present generally will constitute stockholder action. Certain
fundamental corporate changes such as amending the articles of incorporation, a
merger or a disposition of all of the Company's assets, require the approval of
a majority of outstanding shares entitled to vote thereon. Directors are
elected by a plurality of votes cast by stockholders entitled to vote therefor.
Since the Common Stock does not have cumulative voting rights, holders of more
than 50% of the shares present and entitled to vote for directors at a meeting
at which a quorum is present may, if they choose to do so, elect all of the
directors and, in that event, the holders of the remaining shares will not be
able to elect any directors.
American Stock Transfer & Trust Company, New York, New York, is the
transfer agent and registrar for the Common Stock.
CERTAIN PROVISIONS OF CHARTER DOCUMENTS AND NEVADA LAW
Liability Limitation. As permitted by Section 78.037 of the General
Corporation Law of Nevada (the "NGCL"), the Company's Amended and Restated
Articles of Incorporation eliminate the liability of its directors and officers
to the Company and its stockholders for damages for breach of fiduciary duty,
except for acts or omissions which involve intentional misconduct, fraud or a
knowing violation of law, or for the payment of distributions in violation of
the NGCL. To the extent that this provision limits the remedies of the Company
and its stockholders to equitable remedies, it might reduce the likelihood of
derivative litigation and discourage the Company's management or stockholders
from initiating litigation against its directors or officers for breach of
their fiduciary duties. Additionally, equitable remedies may not be effective
in many situations. If a stockholder's only remedy is to enjoin the completion
of an act, such remedy would be ineffective if the stockholder does not become
aware of a transaction or event until after it has been completed. In such a
situation, it is possible that the Company and its stockholders would have no
effective remedy against directors or officers.
Indemnification. The Company's Bylaws make mandatory the indemnification
permitted by the NGCL and the Company's Amended and Restated Articles of
Incorporation. Accordingly, the Company generally must indemnify its
directors, officers, employees and agents against liabilities and expenses to
which they may become subject or which they may incur as a result of being or
having been a director, officer, employee or agent of the Company. Insofar as
indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers and controlling persons of the Company
pursuant to the foregoing provisions, or otherwise, the Company has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable.
9
<PAGE> 11
Nevada Takeover Statute. The Company is subject to provisions of the NGCL
which generally restrict business combinations between the Company and those of
its stockholders who beneficially own 10% or more of the voting power of its
outstanding voting shares. The effect of these provisions is to permit
friendly, negotiated transactions which are approved in advance by the Board of
Directors while restricting a hostile acquiror's flexibility in acquiring the
Company. The following discussion of these provisions is qualified in its
entirety by reference to Nevada Revised Statutes 78.411 through 78.444
(collectively, the "Takeover Statute"). References to Sections are to sections
of the Takeover Statute.
Combinations covered by the Takeover Statute are identified in Section
78.416 and generally include transactions involving the Company's assets or
securities. Section 78.438, subject to certain exceptions, prohibits the
Company from engaging in any combination with any interested stockholder for
three years after the interested stockholder's date of acquiring shares unless
the combination or the purchase of shares made by the interested stockholder on
such stockholder's date of acquiring shares is approved by the Board of
Directors before that date.
Further, Section 78.439 prohibits any combination with an interested
stockholder following the expiration of three years after his date of acquiring
shares unless the combination complies with the Company's articles of
incorporation and either (i) the combination or the purchase of shares by the
interested stockholder is approved by the Board of Directors before the
stockholder's date of acquiring shares, or (ii) the combination is approved by
the affirmative vote of the holders of stock representing a majority of the
outstanding voting power not beneficially owned by the interested stockholder
at a meeting called for that purpose no earlier than three years after the
interested stockholder's date of acquiring shares, or (iii) the aggregate value
of consideration to be received by the holders of the Common Stock and by the
holders of any other class or series of shares satisfies certain standards
specified in the Takeover Statute, the consideration to be received by the
stockholders is distributed promptly and is in cash or the same form as the
interested stockholder used to acquire the largest number of shares previously
acquired by such stockholder, and except as specified in the statute, the
interested stockholder has not become the beneficial owner of any additional
voting shares of the Company after the date of acquiring shares and before the
date of consummation of the combination.
"Interested stockholder" is defined under Section 78.423 as any person
(other than the Company or any of its subsidiaries) who beneficially owns,
directly or indirectly, 10% or more of the voting power of the Company's
outstanding voting shares, or any affiliate or associate of the Company who, at
any time within three years immediately before the date in question, was the
beneficial owner of 10% or more of the voting power of the Company's then
outstanding shares.
COUNSEL
The validity of the Common Stock offered hereby has been passed upon for
the Company by Porter & Hedges, L.L.P., Houston, Texas.
10
<PAGE> 12
===============================================================================
No person is authorized to give any information or to make any representation
not contained in this Prospectus; any information or representation not
contained herein must not be relied upon as having been authorized by the
Company. This Prospectus does not constitute an offer of any securities other
than those to which it relates or an offer to any person in any state where
such offer would be unlawful. Neither the delivery of this Prospectus nor any
sale hereunder shall under any circumstances create any implication that there
has been no change in the affairs of the Company since the date hereof.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
Available Information . . . . . . . . . . . . 2
Incorporation of Certain Documents by
Reference . . . . . . . . . . . . . . . 2
The Company . . . . . . . . . . . . . . . . . 3
Certain Risks . . . . . . . . . . . . . . . . 3
Selling Stockholders . . . . . . . . . . . . 7
Plan of Distribution . . . . . . . . . . . . 8
Description of Securities . . . . . . . . . . 9
Counsel . . . . . . . . . . . . . . . . . . . 10
---------------------
</TABLE>
===============================================================================
===============================================================================
3,062,797 SHARES
SOUTHERN MINERAL CORPORATION
COMMON STOCK
-------------------
P R O S P E C T U S
-------------------
JUNE __, 1995
===============================================================================
<PAGE> 13
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee . . . . . . . . . . . . . . . . . $ 990
Legal Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,000
Accounting Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000
Blue Sky and Related Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000
Printing Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,500
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,010
-------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $32,500(1)
=======
</TABLE>
- ---------------
(1) To be borne 100% by the Registrant.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article Ninth of Registrant's Amended and Restated Articles of
Incorporation permits, and Article VII of Registrant's Bylaws contains
indemnification provisions which make mandatory the indemnification permitted
by Section 78.751 of the General Corporation Law of Nevada ("NGCL").
Accordingly, Registrant generally must indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative
or investigative, by reason of the fact that he is or was a director, officer,
employee or agent of Registrant or is or was serving at the request of
Registrant as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit or
proceeding. However, with respect to an action or suit brought to obtain a
judgment in Registrant's favor, whether by Registrant itself or derivatively by
a stockholder, (i) such indemnification is limited to expenses, including
amounts paid in settlement and attorneys' fees actually and reasonably incurred
by him in connection with the defense or settlement of the action or suit, and
(ii) indemnification may not be made for any claim, issue or matter as to which
such a person has been adjudged by a court of competent jurisdiction, after
exhaustion of all appeals therefrom, to be liable to Registrant or for amounts
paid in settlement to Registrant, unless and only to the extent that the court
in which the action or suit was brought or other court of competent
jurisdiction determines upon application that in view of all the circumstances
of the case, the person is fairly and reasonably entitled to indemnity for such
expenses as the court deems proper.
In all cases, the person seeking indemnification must have acted in
good faith and in a manner he reasonably believed to be in, or not opposed to,
Registrant's best interests. In the case of criminal actions or proceedings,
the person must also have had no reasonable cause to believe his conduct was
unlawful. The determination as to whether a person seeking indemnification has
met the required standard of conduct must be made by Registrant's stockholders,
by a majority vote of a quorum of its disinterested directors, or by
independent legal counsel in a written opinion if such a quorum does not exist
or if the disinterested directors so direct.
To the extent that a director, officer, employee or agent of
Registrant has been successful on the merits or otherwise in defending any
action, suit or proceeding for which indemnification is permissible under the
NGCL, or in defending any claim, issue or matter therein, Registrant must,
under both the NGCL and its Bylaws, indemnify him against expenses, including
attorneys' fees, actually and reasonably incurred by him in connection with the
defense. As permitted by the NGCL, Registrant's Bylaws require it to advance
expenses which its officers and directors incur in defending any civil or
criminal action, suit or proceeding upon receipt of an undertaking by him
II-1
<PAGE> 14
or on his behalf to repay such amounts if it is ultimately determined by a
court of competent jurisdiction that he is not entitled to be indemnified by
Registrant.
The NGCL and Registrant's Bylaws provide that the indemnification and
advancement of expenses authorized therein are not exclusive. Accordingly,
Registrant could provide for other indemnification of its directors and
officers acting in either or both of their official capacities or other
capacities while holding office. However, excepting advancement of expenses
and court-ordered indemnification explicitly provided for by the NGCL, the NGCL
and Registrant's Bylaws prohibit Registrant from indemnifying any director or
officer if a final adjudication establishes that his acts or omissions involved
intentional misconduct, fraud or a knowing violation of the law and was
material to the cause of action.
Consistent with Section 78.752 of the NGCL, Registrant's Bylaws
empower it to procure and maintain insurance on behalf of any person who is or
was a director, officer, employee or agent of Registrant, or at Registrant's
request, of another entity, against any liability asserted against him and
incurred by him in such capacity, or arising out of his status as such,
regardless of whether Registrant could indemnify him against such liability.
Registrant has purchased insurance on behalf of its directors and officers
against certain liabilities that may be asserted against, or incurred by, such
persons in their capacities as directors or officers of the Registrant, or that
may arise out of their status as directors or officers of the Registrant,
including liabilities under federal and state securities laws.
As permitted by Section 78.037 of the NGCL, Registrant's Amended and
Restated Articles of Incorporation eliminate the liability of its directors and
officers to Registrant and its stockholders for damages for breach of fiduciary
duty, except for acts or omissions which involve intentional misconduct, fraud
or a knowing violation of law, or for the payment of distributions in violation
of Section 78.300 of the NGCL. To the extent that this provision limits the
remedies of Registrant and its stockholders to equitable remedies, it might
reduce the likelihood of derivative litigation and discourage Registrant's
management or stockholders from initiating litigation against its directors or
officers for breach of their fiduciary duties. Additionally, equitable
remedies may not be effective in many situations. If a stockholder's only
remedy is to enjoin the completion of an action, such remedy would be
ineffective if the stockholder does not become aware of a transaction or event
until after it has been completed. In such a situation, it is possible that
Registrant and its stockholders would have no effective remedy against
directors or officers.
The above discussion of the NGCL and Registrant's Amended and Restated
Articles of Incorporation and Bylaws is not intended to be exhaustive and is
qualified in its entirety by the NGCL and such Articles and Bylaws.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
Exhibit
No. Description
- ------- -----------
<S> <C>
*5 Opinion of Porter & Hedges, L.L.P. with respect to legality of securities.
*23-A Consent of Porter & Hedges, L.L.P. (included in Exhibit 5).
*23-B Consent of Grant Thornton LLP.
*23-C Consent of Arthur Andersen LLP.
*24 Powers of Attorney (included on signature page).
</TABLE>
- ---------------
* Filed herewith
II-2
<PAGE> 15
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this registration
statement to:
(i) Include any prospectus required by section
10(a)(3) of the Securities Act;
(ii) 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
(iii) Include any material information with respect
to the plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in 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) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
II-3
<PAGE> 16
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Howell H. Howard and Steven H. Mikel,
and each of them, either of whom may act without joinder of the other, his true
and lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any or all pre- and post-effective amendments to this
Registration Statement, and to file the same, with all exhibits thereto and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto such attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, and each of them, or the
substitute or substitutes of either of them, may lawfully do or cause to be
done by virtue hereof.
SIGNATURES
Pursuant to the requirements of the Securities Act, 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 June 26, 1995.
SOUTHERN MINERAL CORPORATION
By: /s/ Steven H. Mikel
----------------------------------------------
Steven H. Mikel,
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the indicated capacities
and on the 26th day of June 1995.
<TABLE>
<CAPTION>
SIGNATURE TITLE
<S> <C>
/s/ Steven H. Mikel Director, and
------------------------------------------------ President and Chief Executive Officer
Steven H. Mikel
/s/ John Misitigh Vice President, Secretary and Treasurer
------------------------------------------------ (principal financial and accounting officer)
John Misitigh
/s/ B. Travis Basham Director
------------------------------------------------
B. Travis Basham
/s/ Thomas R. Fuller Director
------------------------------------------------
Thomas R. Fuller
</TABLE>
II-4
<PAGE> 17
<TABLE>
<CAPTION>
SIGNATURE TITLE
<S> <C>
/s/ Robert R. Hillery Director
------------------------------------------------
Robert R. Hillery
/s/ E. Ralph Hines, Jr. Director
------------------------------------------------
E. Ralph Hines, Jr.
/s/ Howell H. Howard Director and Chairman of the Board
------------------------------------------------
Howell H. Howard
/s/ James E. Nielson Director
------------------------------------------------
James E. Nielson
/s/ Donald H. Wiese, Jr. Director
------------------------------------------------
Donald H. Wiese, Jr.
/s/ Spencer L. Youngblood Director
------------------------------------------------
Spencer L. Youngblood
</TABLE>
II-5
<PAGE> 18
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
No.
- -------
<S> <C>
*5 Opinion of Porter & Hedges, L.L.P. with respect to legality of securities.
*23-A Consent of Porter & Hedges, L.L.P. (included in Exhibit 5).
*23-B Consent of Grant Thornton LLP.
*23-C Consent of Arthur Andersen LLP.
*24 Powers of Attorney (included on signature page).
</TABLE>
- ---------------
* Filed herewith
<PAGE> 1
EXHIBIT 5
[PORTER & HEDGES LETTERHEAD]
June 26, 1995
Southern Mineral Corporation
17001 Northchase, Suite 690
Houston, Texas 77060
Re: SOUTHERN MINERAL CORPORATION REGISTRATION STATEMENT ON FORM
S-3; SHELF RESALE PROSPECTUS
Gentlemen:
We have acted as counsel to Southern Mineral Corporation, a Nevada
corporation ("Company"), in connection with the preparation for filing with the
Securities and Exchange Commission of a Registration Statement on Form S-3
("Registration Statement") under the Securities Act of 1933, as amended. The
Registration Statement relates to an aggregate of 3,062,797 shares ("Shares")
of the Company's common stock, par value $.01 per share ("Common Stock"), to be
sold by certain stockholders of the Company.
We have examined such corporate records, documents, instruments and
certificates of the Company, and have reviewed such questions of law as we have
deemed necessary, relevant or appropriate to enable us to render the opinion
expressed herein. In such examination, we have assumed without independent
investigation the authenticity of all documents submitted to us as originals,
the genuineness of all signatures, the legal capacity of all natural persons,
and the conformity of any documents submitted to us as copies to their
respective originals. As to certain questions of fact material to this
opinion, we have relied without independent investigation upon statements or
certificates of public officials and officers of the Company.
Based upon such examination and review, we are of the opinion that the
Shares have been duly authorized and are (or when issued in accordance with the
terms of outstanding options pursuant to which 818,878 of such Shares are
issuable will be) validly issued, fully paid and nonassessable outstanding
shares of Common Stock.
We hereby consent to the reference to our firm under the caption
"Counsel" in the prospectus included in the Registration Statement.
Very truly yours,
/s/ Porter & Hedges, L.L.P.
----------------------------------------
PORTER & HEDGES, L.L.P.
<PAGE> 1
EXHIBIT 23-B
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We have issued our report dated February 10, 1995 accompanying the
financial statements of Southern Mineral Corporation appearing in the 1994
Annual Report on Form 10-K for the year ended December 31, 1994, which is
incorporated by reference in this Registration Statement. We consent to the
incorporation by reference in the Registration Statement of the aforementioned
report.
/s/ Grant Thornton LLP
- ------------------------------
GRANT THORNTON LLP
Houston, Texas
June 23, 1995
<PAGE> 1
EXHIBIT 23-C
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our report dated
March 31, 1995, included in the Current Report on Form 8-K of Southern Mineral
Corporation dated April 6, 1995.
/s/ Arthur Andersen LLP
-----------------------------
ARTHUR ANDERSEN LLP
San Antonio, Texas
June 21, 1995
