<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON , 1998
REGISTRATION NO.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
SOUTHERN NATURAL GAS COMPANY
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 63-0196650
(State or other jurisdiction (I.R.S. Employer
of Incorporation or organization) Identification No.)
</TABLE>
AMSOUTH-SONAT TOWER
BIRMINGHAM, ALABAMA 35203
(205) 325-7410
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
------------------------------
WILLIAM A. SMITH
AMSOUTH-SONAT TOWER
BIRMINGHAM, ALABAMA 35203
(205) 325-7106
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
------------------------------
IT IS RESPECTFULLY REQUESTED THAT COPIES OF ALL ORDERS, NOTICES AND
COMMUNICATIONS BE SENT TO:
<TABLE>
<S> <C>
JOHN K. HOYNS ROBERT E. BUCKHOLZ, JR.
Hughes Hubbard & Reed LLP Sullivan & Cromwell
One Battery Park Plaza 125 Broad Street
New York, New York 10004 New York, New York 10004
</TABLE>
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO 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: / /
------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING AGGREGATE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED PRICE PER UNIT PRICE REGISTRATION FEE
<S> <C> <C> <C> <C>
Debt Securities...................... $500,000,000 100%* $500,000,000* $147,500
</TABLE>
* Plus accrued interest. Estimated solely for the purpose of calculating the
registration fee.
------------------------------
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>
SOUTHERN NATURAL GAS COMPANY
DEBT SECURITIES
----------------
Southern Natural Gas Company (the "Company") may offer from time to time up
to $500,000,000 aggregate principal amount of its debt securities (the "Debt
Securities") on terms to be determined at the time of sale. As used herein, Debt
Securities shall include securities denominated in United States dollars or, at
the option of the Company if so specified in the applicable Prospectus
Supplement, in any other currency or in composite currencies or in amounts
determined by reference to an index. The specific designation, aggregate
principal amount, authorized denominations, purchase price, maturity, rate and
time of payment of any interest, any redemption terms or other specific terms
and any listing on a securities exchange of the Debt Securities in respect of
which this Prospectus is being delivered ("Offered Debt Securities") are set
forth in the accompanying prospectus supplement ("Prospectus Supplement"),
together with the terms of offering of the Offered Debt Securities.
-------------------
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 Company may sell Debt Securities to or through dealers, acting as
principals for their own accounts ("underwriters") or as agents ("agents"), or
directly to other purchasers. See "Plan of Distribution." Underwriters may be
one or more firms, or a group of underwriters represented by one or more firms.
Such firms may also act as agents. The Prospectus Supplement sets forth the
names of such underwriters or agents and any applicable commissions or
discounts. The net proceeds to the Company from such sale are also set forth in
the Prospectus Supplement.
The date of this Prospectus is March 13, 1998.
<PAGE>
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS OR THE PROSPECTUS SUPPLEMENT, AND,
IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY THE COMPANY OR BY ANY UNDERWRITER OR AGENT. NEITHER
THE DELIVERY OF THIS PROSPECTUS OR THE PROSPECTUS SUPPLEMENT, NOR ANY SALE MADE
HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE
HEREOF OR THEREOF. THIS PROSPECTUS AND THE PROSPECTUS SUPPLEMENT DO NOT
CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY JURISDICTION 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 ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). Such reports 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, Room 1024, and at
the Commission's Regional Offices at Citicorp Center, 500 West 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 by mail from the
Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. Such material may also be accessed
electronically by means of the Commission's Internet web site
(http://www.sec.gov), which contains reports, proxy and information statements
and other information regarding registrants that file electronically with the
Commission. Such reports and other information may also be inspected and copied
at the offices of the New York Stock Exchange, Inc., 20 Broad Street, New York,
New York 10005, where certain of the Company's securities are listed.
The Company has filed with the Commission a registration statement on Form
S-3 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Securities Act"). This Prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. For further
information, reference is hereby made to the Registration Statement.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company incorporates herein by reference the following documents filed
under the Exchange Act with the Commission: (a) Annual Report on Form 10-K for
the year ended December 31, 1996; (b) Quarterly Reports on Form 10-Q for the
quarters ended March 31, June 30 and September 30, 1997; (c) Current Report on
Form 8-K, dated September 25, 1997; and (d) all other documents filed by the
Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after
the date of this Prospectus and prior to the termination of the offering of the
Debt Securities. Such documents shall be deemed to be incorporated herein by
reference and to be a part hereof from the date of filing of such documents. Any
statement contained herein or in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein or in the accompanying Prospectus Supplement
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.
2
<PAGE>
The Company will provide, without charge, to each person to whom this
Prospectus is delivered, upon the request of such person, a copy of any or all
of the documents which are incorporated herein by reference, other than exhibits
to such documents (unless such exhibits are specifically incorporated by
reference into such documents). Such requests should be directed to Secretary,
Southern Natural Gas Company, P.O. Box 2563, Birmingham, Alabama 35202
(telephone: (205) 325-7114).
THE COMPANY
The Company, a Delaware corporation organized in 1935, is a wholly owned
subsidiary of Sonat Inc. ("Sonat"), a Delaware corporation engaged, through the
Company and other subsidiaries, in energy-related activities. The principal
business of the Company and two of its subsidiaries is the transmission of
natural gas in interstate commerce. The Company, including its subsidiaries,
owns 8,829 miles of interstate pipeline. The Company's interstate pipeline
system has a firm daily delivery capacity of 2.5 billion cubic feet ("Bcf") of
natural gas. The Company's interstate pipeline system extends from gas fields in
Texas, Louisiana, Mississippi, Alabama, and the Gulf of Mexico to markets in
Louisiana, Mississippi, Alabama, Florida, Georgia, South Carolina, and
Tennessee. The Company also participates in a gas storage joint venture.
The Company's interstate pipeline business is subject to regulation by the
Federal Energy Regulatory Commission and the U.S. Department of Transportation
under the terms of the Natural Gas Policy Act of 1978, the Natural Gas Act, and
various pipeline safety and environmental laws.
The Company's principal executive offices are located at 1900 Fifth Avenue
North, AmSouth-Sonat Tower, Birmingham, Alabama 35203, and its mailing address
is P.O. Box 2563, Birmingham, Alabama 35202. The Company's telephone number at
its principal executive offices is (205) 325-7410.
USE OF PROCEEDS
Unless otherwise provided in the Prospectus Supplement, the net proceeds
from the sale of the Debt Securities offered hereby will be added to the
Company's general funds and made available for capital expenditures,
refinancings of indebtedness, working capital, refunds to customers and other
general corporate purposes. The Company may invest all or part of such proceeds
in short-term money market instruments pending utilization of such proceeds.
RATIOS OF EARNINGS FROM CONTINUING OPERATIONS TO FIXED CHARGES
<TABLE>
<CAPTION>
NINE MONTHS
ENDED
SEPTEMBER 30, YEARS ENDED DECEMBER 31,
----------------- -------------------------------------
1997 1996 1995 1994
----------------- ----- ----- -----
<S> <C> <C> <C> <C>
Total Enterprise................................................ 6.1 4.5 3.7 2.6
<CAPTION>
1993 1992
----- -----
<S> <C> <C>
Total Enterprise................................................ 3.2 3.6
</TABLE>
For the purpose of calculating the ratios of earnings from continuing
operations to fixed charges, earnings is defined as the sum of net income, fixed
charges (net of interest capitalized) and taxes based on income. Fixed charges
is defined as gross interest on debt, including interest on amounts subject to
refund, amortization of debt discount and expense, and one-third of rental
expense, which is considered representative of the interest factor. The ratios
also include the Company's share of the earnings and fixed charges of continuing
joint ventures.
PLAN OF DISTRIBUTION
The Company may sell Debt Securities to or through underwriters or agents,
or directly to other purchasers. Underwriters may be one or more firms, or a
group of underwriters represented by one or more firms. Such firms may also act
as agents. Underwriters may sell Offered Debt Securities directly to other
purchasers or through other dealers, who may receive compensation from the
underwriters in
3
<PAGE>
the form of discounts, concessions or commissions. The Prospectus Supplement
with respect to the Offered Debt Securities sets forth the terms of the offering
of such Debt Securities, including the name or names of any underwriters or
agents, any discounts, commissions and other items constituting compensation
from the Company, and any discounts, concessions or commissions allowed or
reallowed or paid by any underwriters to other dealers. Underwriters, dealers
and agents participating in the distribution of the Offered Debt Securities may
be deemed to be underwriters, and any discounts or commissions received by them
and any profit realized by them on the resale thereof may be deemed to be
underwriting discounts and commissions, under the Securities Act.
The Debt Securities may be sold from time to time in one or more
transactions at a fixed price or prices, which may be changed, at market prices
prevailing at the time of sale, at prices related to such market prices or at
negotiated prices. The Company also may, from time to time, authorize dealers,
acting as the Company's agents, to solicit offers to purchase the Offered Debt
Securities upon the terms and conditions set forth in any Prospectus Supplement.
If so indicated in the Prospectus Supplement, the Company has authorized
underwriters or agents to solicit offers by specified institutions to purchase
Offered Debt Securities from the Company at the offering price set forth in the
Prospectus Supplement pursuant to delayed delivery contracts providing for
payment and delivery on a specified date in the future. Such contracts will be
subject only to those conditions set forth in the Prospectus Supplement and any
commission payable for solicitation of such contracts is set forth in the
Prospectus Supplement.
Underwriters and agents may be entitled under agreements entered into with
the Company to indemnification by the Company against certain civil liabilities,
including liabilities under the Securities Act, or to contribution by the
Company to payments they may be required to make in respect thereof. Such
underwriters and agents may be customers of, engage in transactions with, or
perform services for, the Company in the ordinary course of business.
DESCRIPTION OF DEBT SECURITIES
The following description of the terms of the Debt Securities sets forth
certain general terms and provisions of the Offered Debt Securities. The
particular terms of the Offered Debt Securities and the extent, if any, to which
such general provisions may apply to the Offered Debt Securities are described
in the Prospectus Supplement relating to such Offered Debt Securities.
The Debt Securities are to be issued under an indenture, dated as of June 1,
1987 between the Company and The Chase Manhattan Bank (formerly known as
Chemical Bank, successor by merger to Manufacturers Hanover Trust Company), as
Trustee (the "Trustee"), as supplemented by the First Supplemental Indenture,
dated as of September 30, 1997, between the Company and the Trustee (as so
supplemented, and as may be further amended or supplemented from time to time,
the "Indenture"). The following statements are summaries of certain provisions
of the Indenture (which is incorporated by reference as an exhibit to the
Registration Statement of which this Prospectus is a part) and are subject to
the detailed provisions of the Indenture. Reference is hereby made to the
Indenture for a full description of such provisions, including definitions of
certain terms used, and for other information with respect to the Debt
Securities. Numerical references below are to Sections of the Indenture.
GENERAL
The Indenture does not limit the aggregate principal amount of Debt
Securities or of any particular series of Offered Debt Securities which can be
issued thereunder and provides that Debt Securities may be issued thereunder
from time to time in one or more series. Reference is made to the Prospectus
Supplement for the following terms of the Offered Debt Securities: (i) the
designation, aggregate principal amount and authorized denominations of the
Offered Debt Securities; (ii) the percentage of
4
<PAGE>
the principal amount at which the Offered Debt Securities will be issued; (iii)
the date or dates on which the Offered Debt Securities will mature; (iv) the
rate or rates (which may be fixed or variable), or the method by which such rate
or rates shall be determined, at which the Offered Debt Securities will bear
interest, if any, the date or dates from which such interest shall accrue, or
the method by which such date or dates shall be determined, the dates on which
such interest shall be payable and the regular record dates with respect
thereto; (v) the dates, if any, on which and the price or prices at which the
Offered Debt Securities will, pursuant to any mandatory sinking fund provisions,
or may, pursuant to any optional sinking fund provisions, be redeemed by the
Company, and the other detailed terms and provisions of such sinking funds; (vi)
the date, if any, after which and the price or prices at which the Offered Debt
Securities may, pursuant to any optional redemption provisions, be redeemed at
the option of the Company or of the Holders thereof and the other detailed terms
and provisions of such optional redemptions; (vii) any additional or substituted
restrictive covenants included for the benefit of the Offered Debt Securities or
any provision that any restrictive covenant in the Indenture shall not apply
with respect to the Offered Debt Securities; (viii) any additional Events of
Default provided with respect to the Offered Debt Securities; (ix) the currency
or currencies of payment of principal of and premium, if any, and interest on
the Offered Debt Securities; (x) any index used to determine the amount of
payments of principal of and premium, if any, and interest on the Offered Debt
Securities; (xi) the application of defeasance or covenant defeasance provisions
to the Offered Debt Securities; and (xii) any other terms (which terms shall not
be inconsistent with the provisions of the Indenture). (Section 3.01.) However,
with respect to Offered Debt Securities sold through agents, the maturities and
interest rates of such Offered Debt Securities may be fixed by the Company from
time to time, in which case such maturities and rates are not set forth in the
Prospectus Supplement relating thereto but instead will be made available
through such agents.
Unless otherwise indicated in the Prospectus Supplement relating thereto,
principal, premium, if any, and interest, if any, will be payable, and the
Offered Debt Securities will be exchangeable and transfers thereof will be
registrable, at the principal corporate trust office of the Trustee in New York
City, except that payment of interest, if any, on the Offered Debt Securities
may be made at the option of the Company by check mailed to the address of the
person entitled thereto as it appears in the register for the Offered Debt
Securities. (Sections 3.05 and 6.02.)
The Debt Securities will be unsecured and will rank on a parity with all
other unsecured and unsubordinated indebtedness of the Company.
Unless otherwise indicated in the Prospectus Supplement relating thereto,
the Offered Debt Securities will be issued only in fully registered form without
coupons in denominations of $1,000 or integral multiples thereof. No service
charge will be made for any transfer or exchange of such Offered Debt
Securities, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith. (Sections 3.02
and 3.05.)
Certain of the Debt Securities may be issued as discounted Debt Securities
(bearing no interest or interest at a rate which at the time of issuance is
below market rates) to be sold at a substantial discount below the stated
principal amount. (Section 1.01.) Federal income tax consequences and other
special considerations applicable to any such discounted Debt Securities will be
described in the Prospectus Supplement relating thereto.
BOOK-ENTRY SYSTEM
The Debt Securities may be issued in the form of one or more fully
registered global notes (collectively, the "Global Notes"), which will be
deposited with, or on behalf of, The Depository Trust Company, New York, New
York (the "Depositary") and registered in the name of the Depositary's nominee.
Except as set forth below, the Global Notes may be transferred, in whole and not
in part, only to the Depositary or another nominee of the Depositary.
5
<PAGE>
The Depositary has advised the Company as follows: The Depositary is a
limited-purpose trust company organized under the laws of the State of New York,
a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code and "clearing agency" registered
pursuant to the provisions of Section 17A of the Exchange Act. The Depositary
was created to hold securities of institutions that have accounts with the
Depositary or its nominee ("participants") and to facilitate the clearance and
settlement of securities transactions among its participants in such securities
through electronic book-entry changes in accounts of the participants, thereby
eliminating the need for physical movement of securities certificates. The
Depositary's participants include securities brokers and dealers (including the
Underwriters), banks, trust companies, clearing corporations and certain other
organizations, some of whom (and/or their representatives) own the Depositary.
Access to the Depositary's book-entry system is also available to others such as
banks, brokers, dealers and trust companies that clear through or maintain a
custodial relationship with a participant, either directly or indirectly. The
Depositary agrees with and represents to its participants that it will
administer its book-entry system in accordance with its rules and bylaws and
requirements of law.
Upon the issuance of the Global Notes, the Depositary will credit, on its
book-entry registration and transfer system, the respective principal amounts of
the Debt Securities represented by such Global Notes to the accounts of
participants. The accounts to be credited shall be designated by the
Underwriters. Ownership of beneficial interests in the Global Notes will be
limited to participants or persons that may hold interests through participants.
Ownership of interests in the Global Notes will be shown on, and the transfer of
those ownership interests will be effected only through, records maintained by
the Depositary (with respect to participants' interests) and such participants
(with respect to the owners of beneficial interest in the Global Notes through
such participants). The laws of some jurisdictions may require that certain
purchasers of securities take physical delivery of such securities in definitive
form. Such limits and laws may impair the ability to transfer beneficial
interests in the Global Notes.
So long as the Depositary, or its nominee, is the registered holder and
owner of the Global Notes, the Depositary or such nominee, as the case may be,
will be considered the sole owner and holder of the related Debt Securities for
all purposes of such Debt Securities and for all purposes under the Indenture.
Except as set forth below, owners of beneficial interests in the Global Notes
will not be entitled to have the Debt Securities represented by such Global
Notes registered in their names, will not receive or be entitled to receive
physical delivery of certificated Debt Securities in definitive form and will
not be considered to be the owners or holders of any Debt Securities under the
Indenture or the Global Notes. Accordingly, each person owning a beneficial
interest in the Global Notes must rely on the procedures of the Depositary and,
if such person is not a participant, on the procedures of the participant
through which such person owns its interest, to exercise any rights of a holder
of Debt Securities under the Indenture or the Global Notes. The Company
understands that under existing industry practice, in the event the Company
requests any action of holders of Debt Securities or an owner of a beneficial
interest in the Global Notes desires to take any action that the Depositary, as
the holder of the Global Notes, is entitled to take, the Depositary would
authorize the participants to take such action, and that the participants would
authorize beneficial owners owning through such participants to take such action
or would otherwise act upon the instructions of beneficial owners owning through
them.
Payment of principal (and premium, if any) and interest on Debt Securities
represented by the Global Notes registered in the name of or held by the
Depositary or its nominee will be made to the Depositary or its nominee, as the
case may be, as the registered owner and holder of the Global Notes.
The Company expects that the Depositary, upon receipt of any payment of
principal or interest in respect of the Global Notes, will credit immediately
participants' accounts with payment in amounts
6
<PAGE>
proportionate to their respective beneficial interests in the principal amount
of the Global Notes as shown on the records of the Depositary. The Company also
expects that payments by participants to owners of beneficial interests in the
Global Notes held through such participants will be governed by standing
instructions and customary practices, as is the case with securities held for
the accounts of customers in bearer form or registered in "street name", and
will be the responsibility of such participants. None of the Company, the
Trustee or any agent of the Company or the Trustee will have any responsibility
or liability for any aspect of the records relating to, or payments made on
account of, beneficial ownership interests in the Global Notes for any Notes or
for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests or for any other aspect of the relationship
between the Depositary and its participants or the relationship between such
participants and the owners of beneficial interests in the Global Notes owning
through such participants.
Unless and until they are exchanged in whole or in part for certificated
Debt Securities in definitive form, the Global Notes may not be transferred
except as a whole by the Depositary to a nominee of such Depositary or by a
nominee of such Depositary to such Depositary or another nominee of such
Depositary.
The Debt Securities represented by the Global Notes are exchangeable for
certificated Debt Securities in definitive registered form of like tenor as such
Debt Securities in denominations of $1,000 and in any greater amount that is an
integral multiple thereof if (i) the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary for the Global Notes or if at any
time the Depositary ceases to be a clearing agency registered under the Exchange
Act, (ii) the Company in its discretion at any time determines not to have all
of the Debt Securities represented by the Global Notes and notifies the Trustee
thereof or (iii) an Event of Default with respect to the Debt Securities
represented by such Global Notes has occurred and is continuing. Any Debt
Securities that are exchangeable pursuant to the preceding sentence are
exchangeable for certificated Debt Securities issuable in authorized
denominations and registered in such names as the Depositary shall direct.
Subject to the foregoing, the Global Notes are not exchangeable except for a
Global Note or Global Notes of the same aggregate denominations to be registered
in the name of the Depositary or its nominee.
LIMITATION ON LIENS
Unless otherwise indicated in the Prospectus Supplement relating to the
Offered Debt Securities, the Company will not create, assume or suffer to exist,
and will not permit any Restricted Subsidiary to create, assume or suffer to
exist otherwise than in favor of the Company or another Restricted Subsidiary,
any lien, subject to certain exceptions, upon any of its properties or upon any
income or profits therefrom, without equally securing therewith the Offered Debt
Securities and any other indebtedness then entitled thereto. Among the
exceptions are purchase money mortgages and pre-existing mortgages (whether or
not assumed) on acquired property; liens on property acquired or constructed by
the Company or a Restricted Subsidiary and created within one year after the
later of the completion of such acquisition or construction or the commencement
of operation of the project; liens of Restricted Subsidiaries outstanding at the
time they become Restricted Subsidiaries; liens created by the Company or
Restricted Subsidiaries to secure funded indebtedness which in the aggregate
does not exceed 15% of consolidated net tangible assets, as defined; liens on
certain equipment, inventory and contract rights; liens securing short-term
indebtedness; various public, governmental, or other grantors' liens and
encumbrances; liens arising in connection with production payments, reserved
interests and other similar transactions; leases; easements; and various other
liens. The Holders of a majority in principal amount of the outstanding Debt
Securities of any series may waive compliance by the Company with this covenant
with respect to such series of Debt Securities. (Sections 6.03 and 6.08.)
7
<PAGE>
In the Indenture, the term "Restricted Subsidiary" is defined to mean an
operating subsidiary, substantially all of the physical properties of which are
located, and substantially all of the business of which is carried on, in the
continental United States, the primary business of which consists of exploration
for, or purchase, development, storage, conservation, processing, production or
transmission of, natural gas, oil or other hydrocarbons or reserves thereof, and
all of the shares of capital stock of which at the time outstanding are owned by
the Company or other Restricted Subsidiaries, provided that once a corporation,
association or business trust has become a Restricted Subsidiary, it remains a
Restricted Subsidiary so long as at least a majority of the outstanding shares
of its capital stock having ordinary voting rights is so owned. (Section 1.01.)
EVENTS OF DEFAULT
Unless otherwise indicated in the Prospectus Supplement, the following will
be Events of Default under the Indenture with respect to any series of Debt
Securities: (a) default in the payment of any installment of interest on any
Debt Securities of that series when due, continued for 30 days; (b) default in
the payment of principal or premium, if any, on any Debt Securities of that
series when due; (c) default in the payment or satisfaction of any sinking fund
obligation with respect to Debt Securities of that series when due; (d) failure
to observe or perform any other covenant (other than a covenant included in the
Indenture for the benefit of any series of Debt Securities other than that
series) continued for 90 days, or 30 days in certain cases, after notice by the
Trustee or by the Holders of 25% in principal amount of the outstanding Debt
Securities of such series; (e) certain events of default on other funded
indebtedness of the Company or Restricted Subsidiaries; (f) certain events of
bankruptcy, insolvency or reorganization with respect to the Company or
Restricted Subsidiaries; or (g) any other Event of Default provided with respect
to Debt Securities of that series. An Event of Default with respect to a
particular series of Debt Securities issued under the Indenture will not
necessarily be an Event of Default with respect to any other series of Debt
Securities issued thereunder. In case an Event of Default shall occur and be
continuing with respect to any series of Debt Securities, the Trustee or the
Holders of not less than 25% in aggregate principal amount of the Debt
Securities then outstanding of the series may declare the principal (or, if the
Debt Securities of such series are discounted Debt Securities, such portion of
the principal as may be specified in the terms of such series) of such series
and the interest accrued thereon to be due and payable. (Section 8.01.)
The Holders of a majority in aggregate principal amount of the outstanding
Debt Securities of any series may waive any default resulting in acceleration of
maturity of the Debt Securities of such series but only if all defaults with
respect to such series have been remedied and all payments due (other than by
acceleration) with respect to such series have been made. (Section 8.01.) Prior
to acceleration of maturity of a particular series of Debt Securities, the
Holders of a majority in aggregate principal amount of the outstanding Debt
Securities of such series may on behalf of the Holders of all Debt Securities of
such series waive any past default under the Indenture and its consequences,
except a default in the payment of interest or premium, if any, on or the
principal of any of the Debt Securities of such series. (Section 8.06.)
Reference is made to the Prospectus Supplement relating to each series of
Offered Debt Securities which are discounted Debt Securities for the particular
provisions relating to acceleration of the maturity of a portion of the
principal amount of such discounted Debt Securities upon the occurrence of an
Event of Default and the continuation thereof.
The Indenture requires the Company to file annually with the Trustee a
certificate as to the absence of default and as to compliance with the terms of
the Indenture. (Section 6.07.) The Indenture provides that the Trustee may
withhold notice to the Holders of the Debt Securities of any default (except in
payment of principal, premium, if any, or interest or in payment of any sinking
fund obligation) if it considers it in the interest of the Holders of the Debt
Securities to do so. (Section 8.07.)
8
<PAGE>
Subject to the provisions of the Indenture relating to the duties of the
Trustee in case an Event of Default shall occur and be continuing, the Indenture
provides that the Trustee shall be under no obligation to exercise any of its
rights or powers under the Indenture at the request, order or direction of the
Holders of the Debt Securities unless such Holders shall have offered to the
Trustee reasonable indemnity. (Sections 8.04, 9.01 and 9.02.) Subject to such
provisions for indemnification and certain other rights of the Trustee, the
Indenture provides that the Holders of a majority in principal amount of the
outstanding Debt Securities of any series shall have 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 with
respect to the Debt Securities of such series. (Section 8.06.)
MODIFICATION OF INDENTURE
Except as to certain modifications and amendments not adverse to Holders of
outstanding Debt Securities, modifications and amendments of the Indenture may
be made by the Company and the Trustee only with the consent of the Holders of a
majority in aggregate principal amount of the outstanding Debt Securities of
each series issued under the Indenture which is affected by the modification or
amendment, provided that no such modification or amendment may: (i) change the
stated maturity date of the principal of, or any installment of interest on, any
Debt Security, reduce the principal amount of, or the interest (or premium, if
any) on, any Debt Security (including in the case of a discounted Debt Security
the amount payable upon acceleration of the maturity thereof or provable in
bankruptcy), change the currency of payment of principal of or interest (or
premium, if any) on any Debt Security, or impair the right to institute suit for
the enforcement of any payment of the principal of, and premium, if any, and
interest on any Debt Security, without the consent of the Holder of such Debt
Security; or (ii) reduce the aforesaid percentage of Debt Securities the Holders
of which are required to consent to modify or amend the Indenture without the
consent of the Holders of all Securities affected thereby. (Sections 8.04, 12.01
and 12.02.)
DEFEASANCE AND COVENANT DEFEASANCE
The Indenture provides that, if and to the extent that the provisions of
Article Fifteen are made applicable to the Debt Securities of any series and
certain conditions are met, the Company may elect either or both (A) to defease
and be discharged from any and all obligations with respect to such Debt
Securities (except for the obligations to register the transfer or exchange of
such Debt Securities, to replace temporary or mutilated, destroyed, lost or
stolen Debt Securities, to maintain an office or agency in respect of the Debt
Securities and to hold moneys for payment in trust) ("defeasance") or (B) to be
released from its obligations with respect to such Debt Securities under Section
6.03 of the Indenture (being the restriction described under "Limitation on
Liens") and any omission to comply with such obligations will not constitute an
Event of Default with respect to Debt Securities of such series ("covenant
defeasance"), upon the irrevocable deposit with the Trustee (or other qualifying
trustee), in trust for such purpose, of money, or Eligible Obligations (as
defined) or U.S. Government Obligations (as defined) which through the payment
of principal and interest in accordance with their terms will provide money, in
an amount sufficient to pay the principal of (and premium, if any) and interest
on such Debt Securities, and any mandatory sinking fund or analogous payments
thereon, on the scheduled due dates therefor. (Article Fifteen.)
Under current federal income tax law, in the event the Company effects
defeasance it is likely that any such deposit in trust of money, Eligible
Obligations or U.S. Government Obligations and discharge of the Indenture with
respect to any series of Debt Securities will be treated as a taxable exchange
of such series of Debt Securities for interests in such trust. In that event, a
Holder of the Debt Securities will recognize gain or loss equal to the
difference between the Holder's cost or other tax basis for the Debt Securities
and the value of the Holder's interest in such trust, and thereafter will be
required to include in income a share of the income, gain and loss of the trust.
Purchasers of the Debt Securities
9
<PAGE>
should consult their own tax advisers with respect to the tax consequences to
them of such deposit and discharge, including the applicability and effect of
tax laws other than the federal income tax law.
In the event the Company effects covenant defeasance with respect to Debt
Securities of any series and the Debt Securities of such series are declared due
and payable because of the occurrence of any Event of Default (other than the
Event of Default described in clause (d) under "Events of Default" with respect
to Section 6.03 of the Indenture), the amount of money, Eligible Obligations and
U.S. Government Obligations on deposit with the Trustee will be sufficient to
pay amounts due on the Debt Securities of such series at the time of their
stated maturity but may not be sufficient to pay amounts due on the Debt
Securities of such series at the time of the acceleration resulting from such
Event of Default. However, the Company will remain liable for such payments.
The term "Eligible Obligations" means interest bearing obligations as a
result of the deposit of which the Debt Securities are rated in the highest
generic long-term debt rating category assigned to legally defeased debt by one
or more nationally recognized rating agencies. (Section 1.01.)
The term "U.S. Government Obligations" means (i) direct obligations of, or
obligations the principal of and interest on which are fully guaranteed by, the
United States of America (provided that such obligations are not callable or
redeemable at the option of the issuer thereof), or (ii) depository receipts
issued by a bank or trust company as custodian with respect to any U.S.
Government Obligation described in clause (i) or a specific payment of interest
on or principal of any such U.S. Government Obligations held by such custodian
for the account of the holder of a depository receipt, PROVIDED that (except as
required by law) such custodian is not authorized to make any deduction from the
amount payable to the holder of such depository receipt from any amount received
by the custodian in respect of the U.S. Government Obligations or the specific
payment of interest on or principal of the U.S. Government Obligations evidenced
by such depository receipt, or (iii) securities that are backed by any U.S.
Government Obligation described in clause (i) as collateral under an arrangement
by which the principal and interest payments on the collateral generally flow
directly through to the holder of the security. (Section 1.01.)
The Prospectus Supplement may further describe the provisions, if any,
permitting such defeasance or covenant defeasance with respect to the Debt
Securities of a particular series.
CONSOLIDATION, MERGER OR SALE
Nothing in the Indenture prohibits the consolidation or merger of the
Company with or into any other corporation, or the sale or conveyance of
substantially all of the Company's properties to any other person (including any
Subsidiary), without the consent of the Holders of the Debt Securities provided
that the successor assumes all obligations of the Company under the Indenture
and the Debt Securities and that certain other conditions are met. (Article
Thirteen.)
THE TRUSTEE
The Chase Manhattan Bank is trustee for the Company and one of its
affiliates and for Sonat under other indentures, is a depositary of the Company,
has from time to time made loans to the Company and Sonat and has performed
other services for the Company and Sonat in the normal course of its business.
LEGAL OPINIONS
The legality of the Debt Securities will be passed upon for the Company by
Hughes Hubbard & Reed LLP, One Battery Park Plaza, New York, NY 10004. Unless
otherwise indicated in the Prospectus Supplement related thereto, if the Offered
Debt Securities are being distributed in an underwritten
10
<PAGE>
offering, the validity of the Offered Debt Securities will be passed on for the
underwriters by Sullivan & Cromwell, 125 Broad Street, New York, NY 10004.
EXPERTS
The consolidated financial statements of Southern Natural Gas Company and
subsidiaries appearing in the Company's Annual Report on Form 10-K for the year
ended December 31, 1996 have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report included therein and incorporated herein
by reference. The consolidated financial statements referred to above are
incorporated herein by reference in reliance upon such report given upon the
authority of such firm as experts in auditing and accounting.
11
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee............................ $ 147,500
Trustee's charges (including counsel fees)..................................... 50,000
Printing and engraving expenses................................................ 110,000
Blue Sky filing fees and expenses.............................................. 5,000
Accountants' fees.............................................................. 250,000
Counsel fees................................................................... 100,000
Rating agency fees............................................................. 422,750
Miscellaneous.................................................................. 14,750
----------
TOTAL........................................................................ $1,100,000
</TABLE>
Note: All of the above expenses, other than the registration fee, are estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section (9) of Article Fifth of the Restated Certificate of Incorporation of
the Company, as amended, contains the following provision:
"(9) No director shall be personally liable to the Corporation or any
stockholder for monetary damages for breach of fiduciary duty as a director,
except (i) for any breach of such director's duty of loyalty to the
Corporation or its stockholders, (ii) for acts or omissions not in good
faith or which involve international misconduct or a knowing violation of
law, (iii) under Section 174 of the Delaware General Corporation Law, or
(iv) for any transaction from which the director derived an improper
personal benefit. If the Delaware General Corporation Law is amended after
approval by the stockholders of this provision to authorize corporate action
further eliminating or limiting the personal liability of directors, then
the liability of directors of the Corporation shall be eliminated or limited
to the full extent permitted by the Delaware General Corporation Law, as so
amended.
"The Corporation shall indemnify to the full extent permitted by the
laws of the State of Delaware as from time to time in effect, each person
who is or was a director of officer of the Corporation in the event that he
was or is a party or is threatened to be made a party to, or otherwise
requires representation by counsel in connection with, 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 the Corporation, or is or was
serving at the request of the Corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, or by reason of any action alleged to have been taken or omitted
in such capacity. This right to indemnification conferred by this Section
(9) shall also include the right of such persons to be paid in advance by
the Corporation for their expenses to the full extent permitted by the laws
of the State of Delaware as from time to time in effect. The right to
indemnification conferred on the directors and officers of the Corporation
by this Section (9) shall be a contract right.
"Unless otherwise determined by the Board of Directors of the
Corporation, the Corporation shall indemnify to the full extent permitted by
the laws of the State of Delaware as from time to time in effect, each
person who is or was an employee or agent of the Corporation in the event
that he was or is a party or is threatened to be made a party to, or
otherwise requires representation by counsel in connection with, any
threatened, pending or completed action, suit or proceeding,
II-1
<PAGE>
whether civil, criminal, administrative or investigative, by reason of the
fact that he is or was an employee or agent of the Corporation, or is or was
serving at the request of the Corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, or by reason of any action alleged to have been taken or omitted
in such capacity.
"The rights and authority conferred in this Section (9) shall not be
exclusive of any other right which any person may have or hereafter acquire
under any statute, provision of this Certificate of Incorporation or by the
By-Laws of the Corporation, agreement, vote of stockholders or disinterested
directors or otherwise.
"Neither the amendment nor repeal of this Section (9), nor the adoption
of any provision of the Certificate of Incorporation or By-Laws or of any
statute inconsistent with this Section (9), shall eliminate or reduce the
effect of this Section (9) in respect of any acts or omissions occurring
prior to such amendment, repeal or adoption of an inconsistent provision."
Section 145 of Chapter 1 of Title B of the Delaware Code provides that every
corporation created under the provisions thereof shall have the power to
indemnify its directors, officers, employees and agents against certain
liabilities.
Sonat Inc. ("Sonat"), the parent company of the Company, has entered into
indemnity agreements with each of its current Directors, certain of whom are
Directors and/or officers of the company. The agreements mandate that Sonat
shall indemnify each such Director to the full extent permitted by the laws of
the State of Delaware as from time to time in effect in the event that he was or
is a party, or is threatened to be made a party, to certain actions by reason of
the fact that he is or was a Director, officer, agent or employee of Sonat or
any corporation, partnership, joint venture or other entity of which the Company
owns 50% or more of the voting or equity interest (including the Company) (an
"Affiliate") or any employee benefit plan of Sonat or an Affiliate. The
agreements also contain certain provisions which set forth the procedures for
obtaining indemnification.
The form of Underwriting Agreement Standard Provisions filed as Exhibit
1-(2) to this Registration Statement contains certain provisions for
indemnification of controlling persons, directors and officers of the Company by
the Underwriters against civil liabilities under the Securities Act of 1933 and
the Securities Exchange Act of 1934. Similar indemnification provisions were
contained in the underwriting agreements executed in connection with prior
offerings and sales of securities by the Company.
The Company has purchased directors and officers liability insurance which
would indemnify the directors and officers of the Company against damages
arising out of certain kinds of claims which might be made against them based on
their negligent acts or omissions while acting in their capacity as such.
II-2
<PAGE>
Section (14) of Article Fifth of the Restated Certificate of Incorporation
of Sonat contains the following provision:
"(14) No director shall be personally liable to the Corporation or any
stockholder for monetary damages for breach of fiduciary duty as a director,
except (i) for any breach of such director's duty of loyalty to the
Corporation or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(iii) under Section 174 of the Delaware General Corporation Law, or (iv) for
any transaction from which the director derived an improper personal
benefit. If the Delaware General Corporation Law is amended after approval
by the stockholders of this provision to authorize corporate action further
eliminating or limiting the personal liability of directors, then the
liability of directors of the Corporation shall be eliminated or limited to
the full extent permitted by the Delaware General Corporation Law, as so
amended.
"The Corporation shall indemnify to the full extent permitted by the
laws of the State of Delaware as from time to time in effect, each person
who is or was a director or officer of the Corporation in the event that he
was or is a party or is threatened to be made a party to, or otherwise
requires representation by counsel in connection with, 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 the Corporation, or is or was
serving at the request of the Corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, or by reason of any action alleged to have been taken or omitted
in such capacity. The right to indemnification conferred by this Section
(14) shall also include the right of such persons to be paid in advance by
the Corporation for their expenses to the full extent permitted by the laws
of the State of Delaware as from time to time in effect. The right to
indemnification conferred on the directors and officers of the Corporation
by this Section (14) shall be a contract right.
"Unless otherwise determined by the Board of Directors of the
Corporation, the Corporation shall indemnify to the full extent permitted by
the laws of the State of Delaware as from time to time in effect, each
person who is or was an employee or agent of the Corporation in the event
that he was or is a party or is threatened to be made a party to, or
otherwise requires representation by counsel in connection with, 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 an employee or agent of the Corporation, or is or was serving at the
request of the Corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
or by reason of any action alleged to have been taken or omitted in such
capacity.
"The rights and authority conferred in this Section (14) shall not be
exclusive of any other right which any person may have or hereafter acquire
under any statute, provision of this Certificate of Incorporation or by the
By-Laws of the Corporation, agreement, vote of stockholders or disinterested
directors or otherwise.
"Neither the amendment nor repeal of this Section (14), nor the adoption
of any provision of the Certificate of Incorporation or By-Laws or of any
statute inconsistent with this Section (14), shall eliminate or reduce the
effect of this Section (14) in respect of any acts or omissions occurring
prior to such amendment, repeal or adoption of an inconsistent provision."
Certain Directors and offices of the Company are Directors, officers and/or
employees of Sonat.
II-3
<PAGE>
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION OF EXHIBIT
- --------- ---------------------------------------------------------------------------------------------------
<C> <S>
1-(1) Form of Underwriting Agreement
1-(2) Form of Underwriting Agreement Standard Provisions
4-(1) Indenture dated June 1, 1987 between the Company and The Chase Manhattan Bank (formerly known as
Chemical Bank, successor by merger to Manufacturers Hanover Trust Company), as Trustee*--filed as
Exhibit 4-(1) to the Company's Registration Statement on Form S-3 (No. 33-16190) and incorporated
herein by reference
4-(2) First Supplemental Indenture, dated as of September 30, 1997, between the Company and the
Trustee--filed as Exhibit 4-(2) to the Company's Current Report on Form 8-K dated September 25,
1997 and incorporated herein by reference.
4-(3) Form of Debenture -- filed as Exhibit 4-(2) to the Company's Registration Statement on Form S-3
(No. 33-16190) and incorporated herein by reference
4-(4) Form of Note -- filed as Exhibit 4-(3) to the Company's Registration Statement on Form S-3 (No.
33-16190) and incorporated herein by reference
5-(1) Opinion of Hughes Hubbard & Reed LLP as to the legality of the Debt Securities
12-(1) Computations of Ratios of Earnings from Continuing Operations to Fixed Charges
23-(1) Consent of Independent Auditors dated March 13, 1998
23-(2) The consent of Hughes Hubbard & Reed LLP is contained in its opinion filed as Exhibit 5-(1) to this
Registration Statement
24-(1) Powers of Attorney
25-(1) Statement of Eligibility and Qualification on Form T-1 under the Trust Indenture Act of 1939 of The
Chase Manhattan Bank (formally known as Chemical Bank, successor by merger to Manufacturers
Hanover Trust Company)*
</TABLE>
- ------------------------
* The Indenture was previously qualified under the Trust Indenture Act of 1939
in connection with Registration Statement No. 33-12784 (Trust Act No.
22-16772).
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:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the registration statement. Notwithstanding the foregoing, any increase
or decrease in volume or securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of a prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement.
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement.
II-4
<PAGE>
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 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 of 1933, 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.
(4) That for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 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.
(b) The undersigned registrant undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4)
or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For purposes of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the provisions described under Item 15 above 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 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 against the registrant 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 Act and will be governed by the final adjudication of such
issue.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Birmingham, State of Alabama, on the 13 day of March,
1998.
<TABLE>
<S> <C> <C>
SOUTHERN NATURAL GAS COMPANY
By: /s/ JAMES A. RUBRIGHT
-----------------------------------------
James A. Rubright
President
</TABLE>
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.
SIGNATURE CAPACITY DATE
- ------------------------------ -------------------------- -------------------
Principal Executive Officer:
/s/ JAMES A. RUBRIGHT
- ------------------------------ President March 13, 1998
(James A. Rubright)
Principal Financial Officer:
/s/ THOMAS W. BARKER, JR.
- ------------------------------ Vice President - Finance March 13, 1998
(Thomas W. Barker, Jr.)
Principal Accounting Officer:
/s/ NORMAN G. HOLMES
- ------------------------------ Vice President and March 13, 1998
(Norman G. Holmes) Controller
Directors:
/s/ RONALD L. KUEHN, JR.*
- ------------------------------ March 13, 1998
(Ronald L. Kuehn, Jr.)
/s/ JAMES E. MOYLAN, JR.*
- ------------------------------ March 13, 1998
(James E. Moylan, Jr.)
/s/ LARRY E. POWELL*
- ------------------------------ March 13, 1998
(Larry E. Powell)
/s/ JAMES A. RUBRIGHT*
- ------------------------------ March 13, 1998
(James A. Rubright)
II-6
<PAGE>
SIGNATURE CAPACITY DATE
- ------------------------------ -------------------------- -------------------
/s/ JAMES C. YARDLEY*
- ------------------------------ March 13, 1998
(James C. Yardley)
*By: /s/ NORMAN G. HOLMES
-------------------------
Norman G. Holmes
Vice President and
Controller,
As authorized
By certain Powers of
Attorney dated March 3,
1998 and filed herewith
as
Exhibit 24-(1)
II-7
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT PAGE
NO. DESCRIPTION NO.
- --------- -------------------------------------------------------------------------------------------------- -----
<C> <S> <C>
1-(1) Form of Underwriting Agreement
1-(2) Form of Underwriting Agreement Standard Provisions
4-(1) Indenture dated June 1, 1987 between the Company and The Chase Manhattan Bank (formerly known as
Chemical Bank, successor by merger to Manufacturers Hanover Trust Company), as Trustee*--filed
as Exhibit 4-(1) to the Company's Registration Statement on Form S-3 (No. 33-16190) and
incorporated herein by reference
4-(2) First Supplemental Indenture, dated as of September 30, 1997, between the Company and the
Trustee--filed as Exhibit 4-(2) to the Company's Current Report on Form 8-K dated September 25,
1997 and incorporated herein by reference
4-(3) Form of Debenture--filed as Exhibit 4-(2) to the Company's Registration Statement on Form S-3 (No.
33-16190) and incorporated herein by reference
4-(4) Form of Note--filed as Exhibit 4-(3) to the Company's Registration Statement on Form S-3 (No.
33-16190) and incorporated herein by reference
5-(1) Opinion of Hughes Hubbard & Reed LLP as to the legality of the Debt Securities
12-(1) Computations of Ratios of Earnings from Continuing Operations to Fixed Charges
23-(1) Consent of Independent Auditors dated March 13, 1998
23-(2) The consent of Hughes Hubbard & Reed LLP is contained in its opinion filed as Exhibit 5-(1) to
this Registration Statement
24-(1) Powers of Attorney
25-(1) Statement of Eligibility and Qualification on Form T-1 under the Trust Indenture Act of 1939 of
The Chase Manhattan Bank (formerly known as Chemical Bank, sucessor by merger Manufacturers
Hanover Trust Company)*
</TABLE>
- ------------------------
* The Indenture was previously qualified under the Trust Indenture Act of 1939
in connection with Registration Statement No. 33-12784 (Trust Act No.
22-16772).
<PAGE>
EXHIBIT 1-(1)
UNDERWRITING AGREEMENT
--------------------
_________ __, ___
Southern Natural Gas Company,
Amsouth-Sonat Tower,
Birmingham, Alabama 35203.
Dear Sirs:
The underwriters named below (such underwriters being herein called
the "Underwriters") understand that Southern Natural Gas Company, a Delaware
corporation (the "Company"), proposes to issue and sell $__________ aggregate
principal amount of __________ (the "Purchased Securities"), registered on
Registration Statement No. 333-_____. Subject to the terms and conditions set
forth herein and incorporated by reference herein and referred to below, the
Company hereby agrees to sell and the Underwriters agree to purchase, severally
and not jointly, the principal amount of such Purchased Securities set forth
opposite their names at ___% of their principal amount.
Name Principal Amount
of Notes
----------------
The Underwriters will pay for such Purchased Securities upon delivery
thereof at the offices of __________, at 10:00 a.m. (New York time) on
___________ __, 199_.
<PAGE>
2
The Purchased Securities shall have the following terms:
Maturity:
Interest Rate:
Redemption Provisions:
Defeasance Provisions:
Interest Payment Dates:
Unless otherwise provided herein, all the provisions contained in the
document entitled Southern Natural Gas Company Underwriting Agreement Standard
Provisions, dated March 1, 1998, a copy of which is attached hereto, are
herein incorporated by reference in their entirety and shall be deemed to be a
part of this Agreement to the same extent as if such provisions had been set
forth in full herein.
All notices and communications hereunder to an Underwriter shall be
given to ______________, attention of _______________.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
<PAGE>
3
This Agreement may be executed by any one or more of the parties hereto in any
number of counterparts, each of which shall be deemed to be an original, but all
such respective counterparts shall together constitute one and the same
instrument.
Very truly yours,
[LIST OF UNDERWRITERS]
By:
-----------------------
Name:
Title:
Accepted:
SOUTHERN NATURAL GAS COMPANY
By:
------------------------
Name:
Title:
<PAGE>
EXHIBIT 1-(2)
SOUTHERN NATURAL GAS COMPANY
DEBT SECURITIES
UNDERWRITING AGREEMENT STANDARD PROVISIONS
------------------
March 1, 1998
Southern Natural Gas Company, a Delaware corporation (the "Company"),
proposes to issue and sell from time to time certain of its debt securities
("Debt Securities") registered under the Securities Act of 1933 (the
"Securities Act") as set forth in Section 3. The Debt Securities are to be
issued under an indenture, dated as of June 1, 1987 as amended or
supplemented from time to time (the "Indenture"), between the Company and The
Chase Manhattan Bank (formerly known as Chemical Bank, successor by merger to
Manufacturers Hanover Trust Company), as Trustee (the "Trustee").
From time to time, the Company may enter into one or more underwriting
agreements that provide for the sale of the Debt Securities to the underwriter
or several underwriters named therein (the "Underwriters"). The standard
provisions set forth herein may be incorporated by reference in any such
underwriting agreement (an "Underwriting Agreement"). The Underwriting
Agreement, including the provisions hereof incorporated therein by reference, is
herein referred to as this Agreement.
1. SALE AND PURCHASE OF THE DEBT SECURITIES. On the basis of the
representations, warranties and agreements herein contained, the Company
proposes to issue and sell the Debt Securities in one or more series, which
series may vary as to their terms (including, but not limited to, interest rate,
maturity, any redemption provisions and any sinking fund requirements), all of
such terms for any particular series being determined at the time of sale. All
or a portion of a particular series of the Debt Securities will be purchased by
the Underwriters for resale upon terms of offering determined at the time of
sale. The Debt Securities so to be purchased in any such offering are
hereinafter referred to as the "Purchased Securities", and any firm or firms
acting as representatives of such Underwriters are hereinafter referred to as
the "Representatives". If with respect to the Purchased Securities such
Representatives are acting on behalf of the Underwriters, references herein to
the Underwriters (or a majority in interest thereof) or the Representatives in
the alternative shall be deemed to refer only to the Representatives. The term
"Underwriters' Securities" means Purchased Securities other than Contract
Securities. The term "Contract Securities" means Purchased Securities, if any,
to be purchased pursuant to delayed delivery contracts referred to below.
If this Agreement provides for sales of Purchased Securities pursuant to
delayed delivery contracts, the Company hereby authorizes the Underwriters to
solicit offers to purchase Contract Securities on the terms and subject to the
conditions set forth in the Prospectus (as hereinafter
<PAGE>
2
defined) pursuant to delayed delivery contracts substantially in the form of
Schedule I attached hereto (the "Delayed Delivery Contracts") but with such
changes therein as the Company may authorize or approve. Delayed Delivery
Contracts are to be with institutional investors approved by the Company and of
the types set forth in the Prospectus. On the Closing Date (as hereinafter
defined), the Company will pay the Underwriters the fee set forth in the
Underwriting Agreement in respect of the principal amount of Contract
Securities. The Underwriters will not have any responsibility in respect of the
validity or the performance of Delayed Delivery Contracts.
If the Company executes and delivers Delayed Delivery Contracts with
institutional investors, the Contract Securities shall be deducted from the
Purchased Securities to be purchased by the several Underwriters and the
aggregate principal amount of Purchased Securities to be purchased by each
Underwriter shall be reduced pro rata in proportion to the principal amount of
Purchased Securities set forth opposite each Underwriter's name in the
Underwriting Agreement, except to the extent that the Representatives, if any,
determine that such reduction shall be otherwise and so advise the Company.
The obligations of the Underwriters under this Agreement are several and
not joint.
2. PAYMENT AND DELIVERY. Delivery by the Company of the Underwriters'
Securities and payment by the Underwriters therefor by wire transfer to the
Company's account in immediately available funds, or, if the Underwriters'
Securities are denominated in a currency or currencies other than United States
Dollars, by such other means specified in this Agreement, shall take place at
the office, on the date and at the time specified in this Agreement, which date
and time may be postponed for not more than twelve business days by agreement
between a majority in interest of the Underwriters or the Representatives and
the Company (such date and time of delivery and payment for the Underwriters'
Securities is hereinafter referred to as the "Closing Date").
The Underwriters' Securities shall be registered in such names and shall be
in such denominations as the Underwriters or Representatives shall request at
least two full business days (or such lesser number of days as shall be
specified in the Underwriting Agreement) prior to the Closing Date and shall be
made available to the Underwriters or Representatives for checking and packaging
at least one full business day prior to the Closing Date.
3. REGISTRATION STATEMENT AND PROSPECTUS; PUBLIC OFFERING. The Company
has filed with the Securities and Exchange Commission (the "Commission"),
pursuant to the Securities Act and the rules and regulations adopted by the
Commission thereunder (the "Rules"), a registration statement on Form S-3,
including a prospectus, relating to the Debt Securities, and such registration
statement has become effective. The Company will file with, or mail for filing
to, the Commission a prospectus supplement specifically relating to the
Purchased Securities pursuant to Rule 424 under the Securities Act (the
"Prospectus Supplement"). The term "Registration Statement" means the
registration statement, including financial statements, exhibits and
Incorporated Documents (as hereinafter defined) as amended to the date of this
Agreement. The term "Basic Prospectus" means the prospectus included in the
Registration Statement. The term "Prospectus" means the Basic Prospectus
together with the Prospectus
<PAGE>
3
Supplement. The term "Preliminary Prospectus" means the Basic Prospectus
together with a preliminary prospectus supplement specifically relating to the
Purchased Securities. As used herein, the terms "Registration Statement", "Basic
Prospectus", "Prospectus" and "Preliminary Prospectus" shall include in each
case all documents incorporated, or deemed to be incorporated, therein by
reference pursuant to the requirements of Item 12 of Form S-3 under the
Securities Act (the "Incorporated Documents"), and any reference herein to the
terms "amend", "amendment" or "supplement" with respect to any of the foregoing
documents shall be deemed to refer to and include the filing of any Incorporated
Documents after the date of this Agreement.
The Company understands that the Underwriters propose to make a public
offering of the Purchased Securities, as set forth in and pursuant to the
Prospectus relating thereto. The Company hereby confirms that the Underwriters
and any dealers selected by them are authorized to distribute such Prospectus
(as from time to time further amended or supplemented if the Company furnishes
amendments or supplements thereto to the Underwriters in addition to the
Prospectus Supplement).
4. REPRESENTATIONS AND WARRANTIES. The Company represents and warrants
to each Underwriter that:
(a) The Company meets the requirements for the use of Form S-3 under
the Securities Act.
(b) The Registration Statement, at the time it became effective, and
the Prospectus contained therein, complied, and on the date of the
Prospectus Supplement and when any amendment to the Registration Statement
becomes effective or any supplement to the Prospectus is filed with the
Commission, the Registration Statement, the Prospectus and any such
amendment or supplement, respectively, will comply, fully in all material
respects with the requirements of the Securities Act and the Rules; the
Incorporated Documents comply and will comply fully in all material
respects with the requirements of the Securities Exchange Act of 1934 (the
"Exchange Act") and the rules and regulations adopted by the Commission
thereunder; the Indenture complies and will comply fully in all material
respects with the requirements of the Trust Indenture Act of 1939 (the
"Trust Indenture Act"); and at the date of the Prospectus Supplement, at
the date of any further amendment to the Registration Statement or
supplement to the Prospectus and at the Closing Date, the Registration
Statement and Prospectus will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, except that this
representation and warranty does not apply to (i) statements or omissions
in the Registration Statement or Prospectus (or in amendments or
supplements thereto) made in reliance upon information furnished in writing
to the Company by any Underwriter or the Representatives on behalf of any
Underwriter expressly for use therein; or (ii) that part of the
Registration Statement which shall constitute the Statement of Eligibility
of the Trustee under the Trust Indenture Act on Form T-1, except statements
or omissions in such Statement made in reliance upon information furnished
in writing to the Trustee on behalf of the Company for use therein.
<PAGE>
4
(c) The certificate delivered pursuant to paragraph (d) of Section 5
hereof in connection with the issuance and sale of the Underwriters'
Securities will be, on the date on which it is delivered, in all material
respects true and complete.
5. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS. The obligations of the
Underwriters hereunder to purchase and pay for the Underwriters' Securities are
subject to the following conditions:
(a) No order suspending the effectiveness of the Registration
Statement shall be in effect and no proceedings for such purpose shall be
pending before or threatened by the Commission and any request for
additional information on the part of the Commission (to be included in the
Registration Statement or the Prospectus or otherwise) shall have been
complied with to the reasonable satisfaction of the Underwriters or the
Representatives.
(b) Subsequent to the execution of this Agreement, (i) there shall
not have been any change in the capital stock or long term debt of the
Company and its subsidiaries, (ii) there shall not have been any change on
a consolidated basis in the general affairs, management, financial position
or results of operations of the Company and its subsidiaries taken as a
whole, whether or not arising from transactions in the ordinary course of
business, in each case other than as set forth in or contemplated by the
Registration Statement and Prospectus, (iii) the Company and its
subsidiaries shall not have sustained any material loss or interference
with their business taken as a whole from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
any court or legislative or other governmental action, order or decree,
which is not set forth in the Registration Statement and Prospectus,
(iv) no downgrading shall have occurred in the rating accorded the
Company's debt securities by Standard & Poor's Corporation or Moody's
Investors Service, Inc. and (v) if the Underwriters' Securities are
denominated in a currency or currencies other than United States Dollars,
there shall not have occurred any action by any governmental authority or
any change involving currency exchange rates or exchange controls, if in
the reasonable judgment of a majority in interest of the Underwriters or
the Representatives any such development referred to in clause (i), (ii),
(iii), (iv) or (v) is so material and adverse as to make it impracticable
or inadvisable to consummate the sale and delivery of the Underwriters'
Securities by the Underwriters as contemplated in the Prospectus.
(c) The representations and warranties of the Company contained
herein shall be true and correct on and as of the Closing Date and the
Company shall have performed all covenants and agreements herein contained
to be performed on its part at or prior to the Closing Date.
(d) The Underwriters or the Representatives shall have received on
the Closing Date a certificate, dated the Closing Date, of the Chairman of
the Board, the Vice Chairman of the Board, the President, any Vice
President or the Treasurer and the chief financial or chief accounting
officer of the Company, which shall certify that (i) no order
<PAGE>
5
suspending the effectiveness of the Registration Statement or prohibiting
the sale of the Purchased Securities has been issued and no proceedings for
such purpose are pending before or, to the knowledge of such officers,
threatened by the Commission and (ii) the representations and warranties of
the Company contained herein are true and correct on and as of the Closing
Date and the Company has performed all covenants and agreements herein
contained to be performed on its part at or prior to the Closing Date.
(e) Within 24 hours after the execution of the Underwriting Agreement
by the Company (or at such later time acceptable to the Representatives, or
if there are none, such firm as may be designated by a majority in interest
of the Underwriters) and on the Closing Date, the Representatives or such
designated firm shall have received signed letters from Ernst & Young,
dated the date of delivery, (i) in the case of the first such letter,
substantially identical to the proposed form of such letter previously
delivered to the Representatives or such designated firm; and (ii) in the
case of the second such letter, confirming, on the basis of a review in
accordance with the procedures set forth in the first such letter, that
nothing has come to their attention from the date of the most recent
financial statements of the Company filed with the Commission, audited or
interim, as the case may be, to a date not more than six days prior to the
Closing Date which would require any change in the first such letter if it
were required to be dated and delivered on the Closing Date, except in each
case as described in the second such letter.
(f) The Underwriters or the Representatives shall have received on
the Closing Date from Hughes Hubbard & Reed LLP an opinion, dated the
Closing Date, substantially identical to the form of their opinion attached
hereto as Annex A.
(g) The Underwriters or the Representatives shall have received on
the Closing Date from Sullivan & Cromwell, counsel for the Underwriters,
opinions dated the Closing Date, with respect to the Company, the
Underwriters' Securities, the Registration Statement and Prospectus and
this Agreement. Such opinions shall be satisfactory in all respects to the
Underwriters or the Representatives, and the Company shall have furnished
to counsel for the Underwriters such documents as they may reasonably
request for the purpose of enabling them to render such opinions.
(h) Subsequent to execution of this Agreement there shall not have
occurred any of the following: (x) a suspension or material limitation in
trading in securities generally on the New York Stock Exchange or (y) a
general moratorium on commercial banking activities in New York declared by
either Federal or New York State authorities.
(i) The Company shall have complied with the provisions of
Section 6(d) hereof with respect to the furnishing of prospectuses on the
New York business day next succeeding the date of this Agreement.
6. COVENANTS. The Company covenants and agrees as follows:
(a) To advise the Underwriters or the Representatives promptly of any
amendment or supplementation of the Registration Statement or the
Prospectus (excluding the
<PAGE>
6
filing of Incorporated Documents) prior to the termination of the
distribution of the Underwriters' Securities, to furnish the Underwriters
or the Representatives with a copy of such amendment or supplementation,
and not to file any such amendment or supplementation to which a majority
in interest of the Underwriters or the Representatives shall reasonably
object.
(b) As soon as the Company is advised thereof, to advise the
Underwriters or the Representatives (i) of the initiation or threatening by
the Commission of any proceedings for the issuance of any order suspending
the effectiveness of the Registration Statement, or the qualification of
the Indenture, and (ii) of receipt by the Company or any representative or
attorney of the Company of any other communication from the Commission
relating to the Company, the Registration Statement, any Preliminary
Prospectus or the Prospectus. The Company will make every reasonable effort
to prevent the issuance of an order suspending the effectiveness of the
Registration Statement or the qualification of the Indenture and if any
such order is issued to obtain as soon as possible the lifting thereof.
(c) To deliver, without charge, to the counsel for the Underwriters,
three signed copies of the registration statement, including exhibits and
Incorporated Documents, relating to the Debt Securities in the form it
became effective and of all amendments thereto, including exhibits.
(d) Prior to 10:00 a.m., New York City time, on the business day next
succeeding the date of the Underwriting Agreement, to furnish the
Underwriters with copies of the Prospectus in New York City in such
quantities as the Representatives may reasonably request, and during such
period as a prospectus is required by law to be delivered in connection
with sales of Purchased Securities by an Underwriter or dealer, to deliver
to the Representatives or to Underwriters and dealers, at such office or
offices as the Underwriters or the Representatives may designate, as many
conformed copies of the Indenture, the Registration Statement (excluding
exhibits but including the Incorporated Documents), each Preliminary
Prospectus, the Prospectus and all amendments and supplements to such
documents as the Underwriters or the Representatives may reasonably
request.
(e) During the period in which copies of the Prospectus are to be
delivered as provided in paragraph (d) above, if any event occurs as a
result of which it shall be necessary to amend or supplement the Prospectus
in order to make the statements therein not misleading or to file any
document which will be deemed an Incorporated Document in order to comply
with the Exchange Act and the rules and regulations thereunder, forthwith
(at its own expense, if such supplement or amendment is required at any
time within nine months from the first date upon which Purchased Securities
to which such Prospectus relates are offered to the public) to prepare and
file with the Commission either (i) amendments or supplements to the
Prospectus so that the statements in the Prospectus, as so amended or
supplemented, will not be misleading or (ii) documents which will effect
such compliance. Delivery by Underwriters of any such amendments or
<PAGE>
7
supplements to the Prospectus or documents shall not constitute a waiver of
any of the conditions set forth in Section 5 hereof. In case any
Underwriter is required to deliver a Prospectus nine months or more after
the first date upon which the Purchased Securities to which such Prospectus
relates are offered to the public, the Company will, upon the request of
such Underwriter or the Representatives but at the expense of such
Underwriter, furnish such Underwriter with reasonable quantities of
prospectuses complying with Section 10(a)(3) of the Securities Act. The
Underwriters agree to use the Prospectus, as amended and supplemented from
time to time, in lieu of the Prospectus theretofore in effect.
(f) To make generally available to the Company's security holders, as
soon as practicable, but in no event later than 45 days after the end of
the 12-month period beginning at the end of the Company's fiscal quarter
during which the filing of the Prospectus pursuant to Rule 424 under the
Securities Act occurs (except not later than 95 days if such filing date is
in the quarter ending December 31), an earning statement which satisfies
the provisions of Section 11(a) of the Securities Act.
(g) To take such action as the Underwriters or the Representatives
may reasonably request in order to qualify the Purchased Securities for
offer and sale under the securities or "blue sky" laws of such
jurisdictions as the Underwriters or the Representatives may reasonably
request; provided that in no event shall the Company be obligated to
qualify to do business in any jurisdiction where it is not now so qualified
or to take any action which would subject it to service of process in
suits, other than those arising out of the offering or sale of the
Purchased Securities, in any jurisdiction where it is not now so subject.
(h) During the period of five years from the date of this Agreement,
to supply to the Representatives, if any, and to each other Underwriter who
may so request in writing, a copy of each annual or other report it shall
be required to file with the Commission.
(i) To pay, or reimburse if paid by the Underwriters or the
Representatives, whether or not the transactions contemplated hereby are
consummated or this Agreement is terminated, all reasonable costs and
expenses incident to the performance of the obligations of the Company
under this Agreement, including those relating to (i) the preparation,
printing and filing of the Registration Statement and exhibits thereto,
each Preliminary Prospectus, the Prospectus, all amendments and supplements
to the Registration Statement and the Prospectus (except as provided in
paragraph (e) above), and the printing of the Underwriting Agreements
(including the Agreement Among Underwriters, if any, and the Agreements
With Dealers, if any), (ii) the issuance of the Purchased Securities and
the preparation and delivery of certificates for the Purchased Securities
to the Underwriters, (iii) the registration or qualification of the
Purchased Securities for offer and sale under the securities or "blue sky"
laws of the various jurisdictions referred to in paragraph (g) above,
including the fees and disbursements of counsel for the Underwriters in
connection therewith and the preparation and printing of
<PAGE>
8
preliminary or supplementary "blue sky" memoranda and legal investment
memoranda, (iv) the furnishing to the Representatives, if any, and the
Underwriters of copies of each Preliminary Prospectus, the Prospectus and
all amendments or supplements to the Prospectus (except as provided in
paragraph (e) above), and of the several documents required by this
Section 6 to be so furnished, including costs of shipping and mailing,
(v) the listing, if any, of the Purchased Securities on any national
securities exchange, (vi) the filing requirements of the National
Association of Securities Dealers, Inc., in connection with its review of
corporate financings, (vii) the rating of the Purchased Securities by
rating agencies, and (viii) the furnishing to the Representatives, if any,
and to the Underwriters of copies of all reports and information required
by paragraph (h) above, including costs of shipping and mailing; but the
Company shall not in any event be liable to any of the several Underwriters
for damages on account of loss of anticipated profits from the sale by them
of the Purchased Securities.
(j) To endeavor to obtain as promptly as practicable the listing of
the Purchased Securities on the national securities exchange designated in
the Underwriting Agreement if any such designation is made.
(k) To prepare the Prospectus as amended and supplemented in relation
to the applicable Purchased Securities in a form approved by the
Underwriters or the Representatives and to file (or transmit by means
reasonably calculated to result in filing) such Prospectus pursuant to
Rule 424(b) under the Securities Act not later than the Commission's close
of business on the second business day following the execution and delivery
of this Agreement or, if applicable, such earlier time as may be required
by Rule 424(b).
(l) As soon as the Company is advised thereof, to advise the
Underwriters of any suspension of the qualification of the Purchased
Securities for offering or sale in any jurisdiction or the initiation or
threatening of any proceeding for any such purpose. The Company will make
every reasonable effort to prevent the issuance of an order suspending the
effectiveness of the qualification of the Purchased Securities for offering
or sale, and if any such order is issued to obtain as soon as possible the
lifting thereof.
7. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within
the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act against any and all losses, claims, damages and liabilities,
joint or several (including any investigation, legal and other expenses
reasonably incurred in connection with, and any amount paid in settlement
of, any action, suit or proceeding or any claim asserted), to which they,
or any of them, may become subject under the Securities Act, the Exchange
Act or other federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the
<PAGE>
9
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as any such untrue statement or
omission or alleged untrue statement or omission was made in (i) such
Preliminary Prospectus, the Registration Statement or the Prospectus, or
such amendment or supplement, in reliance upon and in conformity with
information furnished in writing to the Company by or on behalf of any
Underwriter expressly for use in the preparation thereof or (ii) that part
of the Registration Statement which constitutes the Statement of
Eligibility and Qualification of the Trustee under the Trust Indenture Act
other than any such untrue statement or omission or alleged untrue
statement or omission made therein in reliance upon and in conformity with
information furnished in writing to the Trustee by or on behalf of the
Company for use in the preparation thereof; provided, however, that the
foregoing indemnity agreement against losses, claims, damages or
liabilities is subject to the condition that, insofar as it relates to any
untrue statement or alleged untrue statement, omission or alleged omission
made in the Registration Statement or any Preliminary Prospectus but
eliminated or remedied in the Prospectus (not including Incorporated
Documents), such indemnity agreement shall not inure to the benefit of any
Underwriter from whom the person asserting any loss, claim, damage or
liability purchased the Underwriters' Securities which are the subject
thereof (or to the benefit of any person who controls such Underwriter) if
such Underwriter failed to send or give a copy of the Prospectus (not
including Incorporated Documents) (or, if the Prospectus (not including
Incorporated Documents) has been amended or supplemented in the manner and
under the circumstances specified in the next following proviso clause and
copies thereof have previously been furnished by or on behalf of the
Company to such Underwriter, then the Prospectus (not including
Incorporated Documents) as so amended or supplemented) to such person at or
prior to the time such action is required by the Securities Act; provided
further, that the foregoing indemnity agreement is also subject to the
condition that, insofar as it relates to any untrue statement or alleged
untrue statement, omission or alleged omission made in the Prospectus
attributable solely to facts or events which occur after the date of this
Agreement which untrue statement or alleged untrue statement, omission or
alleged omission is eliminated or remedied in an amendment or supplement to
the Prospectus (not including Incorporated Documents), such indemnity
agreement shall not inure to the benefit of any Underwriter from whom the
person asserting any loss, claim, damage or liability purchased the
Underwriters' Securities which are subject thereof (or to the benefit of
any person who controls such Underwriter), if such Underwriter, having
previously been furnished by or on behalf of the Company with copies of the
Prospectus (not including Incorporated Documents) as so amended or
supplemented, in lieu thereof delivered to such person the Prospectus (not
including Incorporated Documents) without such amendment or supplement.
(b) Each Underwriter agrees to indemnify and hold harmless the
Company, each person, if any, who controls the Company within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act, each
director of the Company and each officer of the Company who signs the
Registration Statement to the same extent as the foregoing indemnity from
the Company to each Underwriter, but only insofar as such
<PAGE>
10
losses, claims, damages or liabilities arise out of or are based upon any
untrue statement or omission or alleged untrue statement or omission which
was made in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, in reliance upon and in
conformity with information furnished in writing to the Company by such
Underwriter expressly for use in the preparation thereof.
(c) Any party which proposes to assert the right to be indemnified
under this Section 7 will, promptly after receipt of notice of commencement
of any action, suit or proceeding against such party in respect of which a
claim is to be made against an indemnified party under this Section 7,
notify each such indemnifying party of the commencement of such action,
suit or proceeding, enclosing a copy of all papers served, but the omission
so to notify such indemnifying party of any such action, suit or proceeding
shall not relieve it from any liability which it may have to any
indemnified party otherwise than under this Section 7. In case any such
action, suit or proceeding shall be brought against any indemnified party
and it shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate in, and, to the extent
that it shall wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party for any
legal or other expenses, other than reasonable costs of investigation
subsequently incurred by such indemnified party in connection with the
defense thereof. The indemnified party shall have the right to employ its
counsel in any such action, but the fees and expenses of such counsel shall
be at the expense of such indemnified party unless (i) the employment of
counsel by such indemnified party has been authorized by the indemnifying
parties, (ii) the indemnified party shall have reasonably concluded that
there may be a conflict of interest between the indemnifying parties and
the indemnified party in the conduct of the defense of such action (in
which case the indemnifying parties shall not have the right to direct the
defense of such action on behalf of the indemnified party) or (iii) the
indemnifying parties shall not in fact have employed counsel to assume the
defense of such action. An indemnifying party shall not be liable for any
settlement of any action or claim effected without its consent. For the
purposes of clause (ii) of the preceding sentence only, any indemnified
party or parties shall be represented by one counsel whom they may select
with the approval, which shall not be unreasonably withheld, of the
indemnifying parties.
8. CONTRIBUTION. In order to provide for just and equitable contribution
in circumstances in which the indemnification provided for in Section 7 is
applicable but for any reason, other than as specified in Section 7, is held to
be unavailable from the indemnifying party, then each indemnifying party shall,
in lieu of indemnifying such indemnified party, contribute to the aggregate
losses, claims, damages and liabilities (including any investigation, legal and
other expenses reasonably incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claims asserted), in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other from the offering of
Purchased Securities. If however, the allocation provided by the
<PAGE>
11
immediately preceding sentence is not permitted by applicable law, then each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one hand and
the Underwriters on the other in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions in
respect thereof), as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the Underwriters
on the other shall be deemed to be in the same proportion as the total net
proceeds from the offering of Purchased Securities (before deducting expenses)
received by the Company bear to the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in the Prospectus. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company on the one hand or the Underwriters on the other and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Underwriters agree that
it would not be just and equitable if contributions pursuant to this Section 8
were determined by PRO RATA allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this
Section 8. Notwithstanding the provisions of this Section 8, (i) in no case
shall any Underwriter (except as may be provided in the Agreements Among
Underwriters, if any) be responsible for any amount in excess of the sum of the
underwriting discount applicable to the Underwriters' Securities purchased by
such Underwriter hereunder and commissions received for sales of Contract
Securities, if any, and (ii) no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 8, each person, if any, who
controls an Underwriter within the meaning of the Securities Act and the
Exchange Act shall have the same rights to contribution as such Underwriter, and
each person, if any, who controls the Company within the meaning of the
Securities Act and the Exchange Act, each officer of the Company who shall have
signed the Registration Statement and each director of the Company shall have
the same rights to contribution as the Company, subject in each case to
clauses (i) and (ii) of this Section 8. Any party entitled to contribution will,
promptly after receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim for contribution may
be made against another party or parties under this Section 8, notify such party
or parties from whom contribution may be sought, but the omission so to notify
such party or parties from whom contribution may be sought shall not relieve the
party or parties from whom contribution may be sought from any other obligation
it or they may have hereunder or otherwise than under this Section 8. No party
shall be liable for contribution with respect to any action or claim settled
without its written consent. The Underwriters' obligations in this section to
contribute are several in proportion to their respective obligations and not
joint.
9. TERMINATION. This Agreement may be terminated by the Representatives
or by Underwriters who have agreed to purchase in the aggregate at least 50% of
the principal amount of the Underwriters' Securities by notifying the Company at
any time
<PAGE>
12
(a) at or prior to the Closing Date if, in the judgment of the
Representatives or in the judgment of such Underwriters, as the case may
be, payment for and delivery of the Underwriters' Securities is rendered
impracticable or inadvisable because (i) any event shall have occurred or
shall exist which makes untrue or incorrect in any material respect any
statement or information contained in the Registration Statement or
Prospectus or which is not reflected in the Registration Statement or
Prospectus but should be reflected therein in order to make the statements
or information contained therein not misleading in any material respect, or
(ii) the declaration by the United States of a national emergency or war
shall have occurred, or there shall have occurred an outbreak or escalation
of hostilities involving the United States to such an extent as, in the
judgment of the Underwriters, to affect materially and adversely the
marketability of the Underwriters' Securities; or
(b) at or prior to the Closing Date, if any of the conditions
specified in Section 5 hereof shall not have been fulfilled when and as
required by this Agreement.
If this Agreement is terminated pursuant to any of the provisions hereof,
except as otherwise provided in Sections 6(i), 7 and 10 hereof, the Company
shall not be under any liability to any Underwriter and no Underwriter shall be
under any liability to the Company, except that (a) if this Agreement is
terminated by the Representatives or the Underwriters because of any failure or
refusal on the part of the Company to comply with the terms or to fulfill any of
the conditions of this Agreement, the Company will reimburse the Underwriters
for all their reasonable out-of-pocket expenses up to $20,000 (including the
fees and disbursements of their counsel) and (b) no Underwriter who shall have
failed or refused to purchase the Underwriters' Securities agreed to be
purchased by it hereunder, without some reason sufficient hereunder to justify
its cancellation or termination of its obligations hereunder, shall be relieved
of liability to the Company or to the other Underwriters for damages occasioned
by its default.
10. SUBSTITUTION OF UNDERWRITERS. If one or more of the Underwriters
shall fail (other than for a reason sufficient to justify the termination of
this Agreement) to purchase on the Closing Date the Underwriters' Securities
agreed to be purchased by such Underwriter or Underwriters on such Closing Date,
the Representatives or, if there are none, such firm as may be designated by a
majority in interest of the Underwriters, may find one or more substitute
underwriters to purchase such Underwriters' Securities, or make such other
arrangements as they may deem advisable or one or more of the remaining
Underwriters may agree to purchase such Underwriters' Securities in such
proportions as may be approved by the Representatives or such designated firm,
in each case upon the terms herein set forth. If no such arrangements have been
made within 24 hours after the Closing Date, and
(a) the aggregate principal amount of Underwriters' Securities to be
purchased by the defaulting Underwriters on the Closing Date shall not
exceed 10% of the total principal amount of Underwriters' Securities that
the Underwriters are obligated to purchase on the Closing Date, each of the
nondefaulting Underwriters shall be obligated to purchase such
Underwriters' Securities on the terms herein set forth in proportion to
their respective obligations hereunder; or
<PAGE>
13
(b) the aggregate principal amount of Underwriters' Securities to be
purchased by the defaulting Underwriters on the Closing Date shall exceed
10% of the total principal amount of Underwriters' Securities that the
Underwriters are obligated to purchase on the Closing Date, the Company
shall be entitled to an additional period of 24 hours within which to find
one or more substitute underwriters satisfactory to the Representatives or
such designated firm, to purchase such Underwriters' Securities upon the
terms set forth herein.
In any such case, either the Representatives or such designated firm or the
Company shall have the right to postpone the Closing Date for a period of not
more than five business days in order that necessary changes and arrangements
may be effected. If neither the non-defaulting Underwriters nor the Company
shall make arrangements pursuant to clause (b) of this Section 10 within the
period stated for the purchase of the Underwriters' Securities which such
defaulting Underwriters agreed to purchase, this Agreement shall terminate
without liability on the part of any non-defaulting Underwriter to the Company
and without liability on the part of the Company, except, in both cases, as
provided in Section 7, 8 and 9 hereof. The provisions of this Section 10 shall
not in any way affect the liability of any defaulting Underwriter to the Company
or the non-defaulting Underwriters arising out of such default.
11. MISCELLANEOUS. The representations, warranties and covenants of the
Company in this Agreement shall remain in full force and effect regardless of
(a) any investigation made by or on behalf of any Underwriter or controlling
person or by or on behalf of the Company or any controlling person, director or
officer, and (b) delivery of and payment for the Purchased Securities under this
Agreement. The indemnification and reimbursement agreements contained in
Sections 7 and 8 hereof shall remain in full force and effect regardless of any
termination of this Agreement.
This Agreement has been and is made solely for the benefit of the
Underwriters and the Company, and their respective successors and assigns, and,
to the extent expressed herein, for the benefit of persons controlling any of
the Underwriters or the Company, directors and officers of the Company and their
respective successors and assigns, and no other person, partnership, association
or corporation shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" shall not include any purchaser of
Purchased Securities from any Underwriter merely because of such purchase.
In all dealings hereunder, the Representatives, if designated, shall act on
behalf of each of the Underwriters, and the parties hereto shall be entitled to
act and rely upon any statement, request, notice or agreement on behalf of any
Underwriter made or given by such firm as the Representatives may designate to
the Company.
<PAGE>
14
Except as otherwise provided in this Agreement, all notices and
communications hereunder shall be in writing and mailed or delivered, or by
telephone or telegraph if subsequently confirmed in writing, to the Underwriters
at their addresses furnished to the Company in writing, and to the Company at
1900 Fifth Avenue North, AmSouth-Sonat Tower, Birmingham, Alabama 35203,
Attention: General Counsel.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK.
<PAGE>
SCHEDULE I
DELAYED DELIVERY CONTRACT
__________, 19__
Dear Sirs:
The undersigned hereby agrees to purchase from Southern Natural Gas
Company, a Delaware corporation (the "Company"), and the Company agrees to sell
to the undersigned
$
principal amount of the Company's [state title of issue] (the "Securities"),
offered by the Company's Prospectus dated , 19__ and Prospectus
Supplement dated , 19__, receipt of copies of which is hereby
acknowledged, at a purchase price of % of the principal amount thereof plus
accrued interest and amortization, if any, and on the further terms and
conditions set forth in this contract. The undersigned does not contemplate
selling Securities prior to making payment therefor.
The undersigned will purchase from the Company Securities in the principal
amounts and on the delivery dates set forth below:
PLUS ACCRUED
INTEREST AND
AMORTIZATION,
DELIVERY DATE PRINCIPAL AMOUNT IF ANY, FROM:
$
$
$
Each such date on which Securities are to be purchased hereunder is hereinafter
referred to as a "Delivery Date".
Payment for the Securities which the undersigned has agreed to purchase on
each Delivery Date shall be made to the Company or its order [by certified or
official bank check in immediately available funds at the office of
, New York, New York, at 10:00 a.m. (New York time) on the Delivery
Date] [state means of payment if the Securities are denominated in a currency or
currencies other than United States Dollars], upon delivery to the undersigned
of the Securities to be purchased by the undersigned on the Delivery Date, in
such denominations and registered in such names as the undersigned may designate
by written or telegraphic communication addressed to the Company not less than
five full business days prior to the Delivery Date. If no such request is
received, the Securities will be registered in the name of the
<PAGE>
2
undersigned and issued in a denomination equal to the aggregate principal amount
of Securities to be purchased by the Delivery Date.
The obligation of the undersigned to take delivery of and make payment for
the Securities on the Delivery Date shall be subject to the conditions that
(1) the purchase of Securities to be made by the undersigned shall not at the
time of delivery be prohibited under the laws of the jurisdiction to which the
undersigned is subject and (2) the Company shall have sold, and delivery shall
have taken place to the underwriters (the "Underwriters") named in the
Prospectus Supplement referred to above, of such part of the Securities as is to
be sold to them. Promptly after completion of sale and delivery to the
Underwriters, the Company will mail or deliver to the undersigned at its address
set forth below notice to such effect, accompanied by a copy of the opinion of
counsel for the Company delivered to the Underwriters in connection therewith.
The undersigned represents and warrants to you that its investment in the
Securities is not, as of the date hereof, prohibited under the laws of any
jurisdiction to which the undersigned is subject and which govern such
investment.
Failure to take delivery of and make payment for securities by any
purchaser under any other Delayed Delivery Contract shall not relieve the
undersigned of its obligations under this contract.
This contract will inure to the benefit of and be binding upon the parties
hereto and their respective successors, but will not be assignable by either
party hereto without the written consent of the other.
It is understood that acceptance of this contract and other similar
contracts is in the Company's sole discretion and, without limiting the
foregoing, need not be on a first come, first-served basis.
If this contract is acceptable to the Company, it is requested that the
Company sign the form of acceptance below and mail or deliver one of the
counterparts hereof to the undersigned at its address set forth below. This will
become a binding contract, as of the date first above written, between the
Company and the undersigned when such counterpart is so mailed or delivered.
<PAGE>
3
This contract shall be governed by and construed in accordance with the
laws of the State of NEW YORK.
Yours very truly,
---------------------------
(PURCHASER)
By
------------------------
---------------------------
(TITLE)
---------------------------
---------------------------
(ADDRESS)
Accepted:
SOUTHERN NATURAL GAS COMPANY
By
-------------------------
- ----------------------------
(TITLE)
- ----------------------------
- ----------------------------
(ADDRESS)
PURCHASER -- PLEASE COMPLETE AT TIME OF SIGNING
The name and telephone and department of the representative of the
Purchaser with whom details of delivery on the Delivery Date may be discussed is
as follows: (Please print.)
TELEPHONE NUMBER
NAME (INCLUDING AREA CODE) DEPT.
<PAGE>
ANNEX A
Pursuant to Section 5(f) of the Southern Natural Gas Company Underwriting
Agreement Standard Provisions, Hughes Hubbard & Reed LLP shall furnish an
opinion with respect to the Federal laws of the United States, the laws of the
State of New York and the General Corporation Law of the State of Delaware to
the effect that:
(i) The Company was duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with
corporate power under the General Corporation Law of such State to carry on the
business in which it is now engaged, as described in the Prospectus.
(ii) The Company is duly qualified as a foreign corporation in the
States of Alabama, Florida, Georgia, Louisiana, Mississippi, South Carolina,
Tennessee and Texas.
(iii) The Indenture has been duly authorized, executed and delivered
by the Company, has been duly qualified under the Trust Indenture Act of 1939,
as amended, and, assuming the due authorization, execution and delivery thereof
by the Trustee, constitutes a valid and binding agreement of the Company in
accordance with its terms, except as limited by general equitable principles and
by bankruptcy, insolvency, reorganization or other laws affecting the
enforcement of creditors' rights; and the Purchased Securities have been duly
authorized and executed by the Company, and, when authenticated, issued and
delivered in accordance with the provisions of the Indenture and the
Underwriting Agreement, will constitute valid and binding obligations of the
Company entitled to the benefits of the Indenture, except as limited by general
equitable principles and by bankruptcy, insolvency, reorganization or other laws
affecting the enforcement of creditors' rights.
(iv) The Registration Statement has become effective under the
Securities Act and, to such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued under the Securities
Act or proceedings therefor instituted or threatened under the Securities Act by
the Securities and Exchange Commission.
(v) The Registration Statement and the Prospectus comply as to
form in all material respects with the requirements of the Securities Act, the
Trust Indenture Act of 1939, as amended, and the applicable Rules and
Regulations of the Securities and Exchange Commission thereunder (except for the
Statement of Eligibility and Qualification of the Trustee on Form T-1, the
financial statements and notes thereto, related schedules and exhibits and other
financial data included in or omitted from the Registration Statement and other
matters referred to in the Prospectus under "Experts", as to which such counsel
may express no opinion).
(vi) No approval, authorization, consent, or other order of any
public board or body (other than in connection or in compliance with the
provisions of the Federal securities laws or the securities or Blue Sky laws of
any State) is legally required for the issuance and sale by the Company of the
Purchased Securities.
i
<PAGE>
(vii) The Underwriting Agreement has been duly authorized, executed
and delivered on behalf of the Company.
ii
<PAGE>
EXHIBIT 5-(1)
Hughes Hubbard & Reed LLP One Battery Park Plaza
New York, New York 10004-1482
Telephone: 212-837-6000
Facsimile: 212-422-4726
March 13, 1998
Southern Natural Gas Company
AmSouth-Sonat Tower
Birmingham, Alabama 35203
Dear Sirs:
You have requested our opinion in connection with the Registration
Statement on Form S-3 filed by Southern Natural Gas Company (the "Company") with
the Securities and Exchange Commission under the Securities Act of 1933, as
amended, with respect to the proposed issuance and sale by the Company of up to
$500,000,000 aggregate principal amount of debt securities of the Company (the
"Debt Securities") on terms to be determined at the time of sale. The Debt
Securities are to be issued pursuant to an Indenture dated as of June 1, 1987,
between the Company and The Chase Manhattan Bank (formerly known as Chemical
Bank, successor by merger to Manufacturers Hanover Trust Company), as Trustee
(the "Trustee"), as supplemented by the First Supplemental Indenture, dated as
of September 30, 1997, between the Company and the Trustee (as so supplemented,
the "Indenture"). We have examined such corporate records and other documents
and have made such examinations of law as we have deemed relevant.
It is our opinion that when (a) the applicable provisions of the
Securities Act of 1933, as amended, and such "Blue Sky" or securities laws as
may be applicable shall have been complied with, and (b) the Debt Securities
shall have been duly authorized by the Company as contemplated by the Indenture,
subject to the terms of such Debt Securities being otherwise in compliance with
then applicable law, and duly executed, authenticated and delivered against
payment therefor, the Debt Securities will be legally issued and binding
obligations of the Company.
We hereby consent to the filing of this opinion as an exhibit to said
Registration Statement and we further consent to the use of our name in the
Registration Statement under the caption "Legal Opinions." In giving this
consent, we do not thereby admit that we are in the category of persons whose
consent is required under Section 7 of the Securities Act of 1933, as amended,
or the rules and regulations of the Securities and Exchange Commission
thereunder.
Very truly yours,
/s/ HUGHES HUBBARD & REED LLP
<PAGE>
EXHIBIT 12-(1)
SOUTHERN NATURAL GAS COMPANY AND SUBSIDIARIES
Computation of Ratios of Earnings
from Continuing Operations to Fixed Charges
Total Enterprise (a)
<TABLE>
<CAPTION>
Nine Months Ended Sept 30, Years Ended December 31,
-------------------------- -------------------------------------------------
1997 1996 1996 1995 1994 1993 1992
--------- ----------- ---------- --------- ------- -------- -------
(In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings from Continuing Operations:
Income (loss) before income taxes.......... $126,360 $108,319 $150,219 $134,124 $76,098 $127,617 $126,691
Fixed Charges (see computation below)...... 24,939 34,733 43,028 48,779 47,575 58,249 47,995
--------- ----------- ---------- --------- ------- -------- --------
Total Earnings Available for Fixed Charges... $151,299 $143,052 $193,247 $182,903 $123,673 $185,866 $174,686
--------- ----------- ---------- --------- ------- -------- --------
--------- ----------- ---------- --------- ------- -------- --------
Fixed Charges:
Interest expense before deducting
interest capitalized..................... $23,649 $33,049 $41,147 $46,859 $45,900 $56,599 $46,298
Rentals(b)................................... 1,290 1,684 1,881 1,920 1,675 1,650 1,697
--------- ----------- ---------- --------- ------- -------- --------
$24,939 $34,733 $43,028 $48,779 $47,575 $58,249 $47,995
--------- ----------- ---------- --------- ------- -------- --------
--------- ----------- ---------- --------- ------- -------- --------
Ratio of Earnings to Fixed Charges........... 6.1 4.1 4.5 3.7 2.6 3.2 3.6
--------- ----------- ---------- --------- ------- -------- --------
--------- ----------- ---------- --------- ------- -------- --------
</TABLE>
- -------------------
(a) Amounts include the Company's portion of the captions as they relate to
persons accounted for by the equity method.
(b) These amounts represent 1/3 of rentals which approximate the interest
factor applicable to such rentals of the Company and its subsidiaries
and continuing unconsolidated affiliates.
<PAGE>
EXHIBIT 23-(1)
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and the related Prospectus of Southern
Natural Gas Company for the registration of $500,000,000 of debt securities
and to the incorporation by reference therein of our report dated January 20,
1997, with respect to the consolidated financial statements of Southern
Natural Gas Company and Subsidiaries included in its Annual Report (Form
10-K) for the year ended December 31, 1996, filed with the Securities and
Exchange Commission.
ERNST & YOUNG LLP
Birmingham, Alabama
March 13, 1998
<PAGE>
Exhibit 24-(1)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
Southern Natural Gas Company, does hereby constitute and appoint James A.
Rubright; Thomas W. Barker, Jr.; Norman G. Holmes; R. David Hendrickson; and
John C. Griffin, and each of them, his true and lawful attorneys to execute
in his name (whether on behalf of Southern Natural Gas Company or as an
officer or director of Southern Natural Gas Company) the Registration
Statement and any and all amendments and supplements to be filed with the
Securities and Exchange Commission under the Securities Act of 1933 relating
to $500,000,000 aggregate principal amount of debentures, notes, and/or other
debt obligations and/or rights or warrants to purchase any of the foregoing,
as authorized by resolutions adopted by unanimous written consent of the
Board of Directors of the Company on March 2, 1998, and with such terms and
conditions as may be fixed by subsequent actions of said Board of Directors
or of the Special Committee appointed by said Board of Directors, and to file
all exhibits thereto, and any other documents in connection therewith, with
the Securities and Exchange Commission. The undersigned do hereby ratify and
confirm all that said attorneys and agents, and each of them, shall do or
cause to be done by virtue hereof. Each of such attorneys shall have and may
exercise all powers to act hereunder with or without the others.
IN WITNESS WHEREOF, the undersigned has signed his name hereto as of the
3rd day of March, 1998.
/s/James E. Moylan, Jr.
-----------------------
James E. Moylan, Jr.
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
Southern Natural Gas Company, does hereby constitute and appoint James A.
Rubright; Thomas W. Barker, Jr.; Norman G. Holmes; R. David Hendrickson; and
John C. Griffin, and each of them, his true and lawful attorneys to execute
in his name (whether on behalf of Southern Natural Gas Company or as an
officer or director of Southern Natural Gas Company) the Registration
Statement and any and all amendments and supplements to be filed with the
Securities and Exchange Commission under the Securities Act of 1933 relating
to $500,000,000 aggregate principal amount of debentures, notes, and/or other
debt obligations and/or rights or warrants to purchase any of the foregoing,
as authorized by resolutions adopted by unanimous written consent of the
Board of Directors of the Company on March 2, 1998, and with such terms and
conditions as may be fixed by subsequent actions of said Board of Directors
or of the Special Committee appointed by said Board of Directors, and to file
all exhibits thereto, and any other documents in connection therewith, with
the Securities and Exchange Commission. The undersigned do hereby ratify and
confirm all that said attorneys and agents, and each of them, shall do or
cause to be done by virtue hereof. Each of such attorneys shall have and may
exercise all powers to act hereunder with or without the others.
IN WITNESS WHEREOF, the undersigned has signed his name hereto as of the
3rd day of March, 1998.
/s/Ronald L. Kuehn, Jr
------------------------
Ronald L. Kuehn, Jr.
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, an officer and
director of Southern Natural Gas Company, does hereby constitute and appoint
James A. Rubright; Thomas W. Barker, Jr.; Norman G. Holmes; R. David
Hendrickson; and John C. Griffin, and each of them, his true and lawful
attorneys to execute in his name (whether on behalf of Southern Natural Gas
Company or as an officer or director of Southern Natural Gas Company) the
Registration Statement and any and all amendments and supplements to be filed
with the Securities and Exchange Commission under the Securities Act of 1933
relating to $500,000,000 aggregate principal amount of debentures, notes,
and/or other debt obligations and/or rights or warrants to purchase any of
the foregoing, as authorized by resolutions adopted by unanimous written
consent of the Board of Directors of the Company on March 2, 1998, and with
such terms and conditions as may be fixed by subsequent actions of said Board
of Directors or of the Special Committee appointed by said Board of
Directors, and to file all exhibits thereto, and any other documents in
connection therewith, with the Securities and Exchange Commission. The
undersigned do hereby ratify and confirm all that said attorneys and agents,
and each of them, shall do or cause to be done by virtue hereof. Each of
such attorneys shall have and may exercise all powers to act hereunder with
or without the others.
IN WITNESS WHEREOF, the undersigned has signed his name hereto as of the
3rd day of March, 1998.
/s/James A. Rubright
---------------------
James A. Rubright
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, an officer and
director of Southern Natural Gas Company, does hereby constitute and appoint
James A. Rubright; Thomas W. Barker, Jr.; Norman G. Holmes; R. David
Hendrickson; and John C. Griffin, and each of them, his true and lawful
attorneys to execute in his name (whether on behalf of Southern Natural Gas
Company or as an officer or director of Southern Natural Gas Company) the
Registration Statement and any and all amendments and supplements to be filed
with the Securities and Exchange Commission under the Securities Act of 1933
relating to $500,000,000 aggregate principal amount of debentures, notes,
and/or other debt obligations and/or rights or warrants to purchase any of
the foregoing, as authorized by resolutions adopted by unanimous written
consent of the Board of Directors of the Company on March 2, 1998, and with
such terms and conditions as may be fixed by subsequent actions of said Board
of Directors or of the Special Committee appointed by said Board of
Directors, and to file all exhibits thereto, and any other documents in
connection therewith, with the Securities and Exchange Commission. The
undersigned do hereby ratify and confirm all that said attorneys and agents,
and each of them, shall do or cause to be done by virtue hereof. Each of
such attorneys shall have and may exercise all powers to act hereunder with
or without the others.
IN WITNESS WHEREOF, the undersigned has signed his name hereto as of the
3rd day of March, 1998.
/s/Larry E. Powell
-------------------
Larry E. Powell
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, an officer and
director of Southern Natural Gas Company, does hereby constitute and appoint
James A. Rubright; Thomas W. Barker, Jr.; Norman G. Holmes; R. David
Hendrickson; and John C. Griffin, and each of them, his true and lawful
attorneys to execute in his name (whether on behalf of Southern Natural Gas
Company or as an officer or director of Southern Natural Gas Company) the
Registration Statement and any and all amendments and supplements to be filed
with the Securities and Exchange Commission under the Securities Act of 1933
relating to $500,000,000 aggregate principal amount of debentures, notes,
and/or other debt obligations and/or rights or warrants to purchase any of
the foregoing, as authorized by resolutions adopted by unanimous written
consent of the Board of Directors of the Company on March 2, 1998, and with
such terms and conditions as may be fixed by subsequent actions of said Board
of Directors or of the Special Committee appointed by said Board of
Directors, and to file all exhibits thereto, and any other documents in
connection therewith, with the Securities and Exchange Commission. The
undersigned do hereby ratify and confirm all that said attorneys and agents,
and each of them, shall do or cause to be done by virtue hereof. Each of
such attorneys shall have and may exercise all powers to act hereunder with
or without the others.
IN WITNESS WHEREOF, the undersigned has signed his name hereto as of the
3rd day of March, 1998.
/s/James C. Yardley
-------------------
James C. Yardley
<PAGE>
Exhibit 25(1)
___________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
_________________________
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
___________________________________________
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
________________________________________
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
NEW YORK 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 PARK AVENUE
NEW YORK, NEW YORK 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
____________________________________________
SOUTHERN NATURAL GAS COMPANY
(Exact name of obligor as specified in its charter)
DELAWARE 63-0196650
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
AMSOUTH-SONAT TOWER
BIRMINGHAM, ALABAMA 35203
(Address of principal executive offices) (Zip Code)
____________________________________________
DEBT SECURITIES
(Title of the indenture securities)
________________________________________________________
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington,
D.C., 20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty
Street, New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now in
effect, including the Organization Certificate and the Certificates of
Amendment dated February 17, 1969, August 31, 1977, December 31, 1980, September
9, 1982, February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to
Form T-1 filed in connection with Registration Statement No. 333-06249, which
is incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996,
in connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being
contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to
Form T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act
(see Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, a corporation organized and existing under
the laws of the State of New York, has duly caused this statement of eligibility
to be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of New York and State of New York, on the 13th day of March, 1998.
THE CHASE MANHATTAN BANK
By /s/ T. J. Foley
-------------------------------------
T. J. Foley
Vice President
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1997, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
DOLLAR AMOUNTS
ASSETS IN MILLIONS
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin ...................................... $ 12,428
Interest-bearing balances .............................. 3,428
Securities: ................................................
Held to maturity securities.................................. 2,561
Available for sale securities................................ 43,058
Federal funds sold and securities purchased under
agreements to resell ................................... 29,633
Loans and lease financing receivables:
Loans and leases, net of unearned income $129,260
Less: Allowance for loan and lease losses 2,783
Less: Allocated transfer risk reserve .... 0
--------
Loans and leases, net of unearned income,
allowance, and reserve ................................. 126,477
Trading Assets .............................................. 62,575
Premises and fixed assets (including capitalized
leases)................................................. 2,943
Other real estate owned ..................................... 295
Investments in unconsolidated subsidiaries and
associated companies.................................... 231
Customers' liability to this bank on acceptances
outstanding ............................................ 1,698
Intangible assets ........................................... 1,466
Other assets ................................................ 10,268
--------
TOTAL ASSETS ................................................ $297,061
========
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LIABILITIES
Deposits
In domestic offices .................................... $ 94,524
Noninterest-bearing ........................ $39,487
Interest-bearing ........................... 55,037
-------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's ................................. 71,162
Noninterest-bearing ........................ $ 3,205
Interest-bearing ........................... 67,957
Federal funds purchased and securities sold under agree-
ments to repurchase ......................................... 43,181
Demand notes issued to the U.S. Treasury .................... 1,000
Trading liabilities ......................................... 48,903
Other borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less .......... 3,599
With a remaining maturity of more than one year .
through three years................................. 253
With a remaining maturity of more than three years...... 132
Bank's liability on acceptances executed and outstanding 1,698
Subordinated notes and debentures ........................... 5,715
Other liabilities ........................................... 9,896
TOTAL LIABILITIES ........................................... 280,063
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus 0
Common stock ................................................ 1,211
Surplus (exclude all surplus related to preferred stock).... 10,291
Undivided profits and capital reserves ...................... 5,502
Net unrealized holding gains (losses)
on available-for-sale securities ............................ (22)
Cumulative foreign currency translation adjustments ......... 16
TOTAL EQUITY CAPITAL ........................................ 16,998
--------
TOTAL LIABILITIES AND EQUITY CAPITAL ........................ $297,061
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named
bank, do hereby declare that this Report of Condition has
been prepared in conformance with the instructions issued
by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
We, the undersigned directors, attest to the correctness
of this Report of Condition and declare that it has been
examined by us, and to the best of our knowledge and
belief has been prepared in conformance with the in-
structions issued by the appropriate Federal regulatory
authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
- -5-
