<PAGE>
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED JULY 27, 1993
$100,000,000
SONAT INC.
6.75% NOTES DUE OCTOBER 1, 2007
-----------
Interest on the Notes is payable semi-annually on April 1 and October 1 of
each year, commencing April 1, 1998. The Notes may not be redeemed prior to
maturity. The Notes do not provide for any sinking fund. The Notes will be
represented by one or more global Notes registered in the name of the nominee of
The Depository Trust Company. Beneficial interests in the global Notes will be
shown on, and transfers thereof will be effected only through, records
maintained by DTC and its participants. Except as described herein, Notes in
definitive form will not be issued. See "Description of Notes".
--------------
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 SUPPLEMENT
OR THE PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
--------------
<TABLE>
<CAPTION>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO
OFFERING PRICE(1) DISCOUNT(2) COMPANY(1)(3)
--------------------- --------------------- ---------------------
<S> <C> <C> <C>
Per Note.................................. 99.748% 0.650% 99.098%
Total..................................... $99,748,000 $650,000 $99,098,000
<FN>
- --------------
(1) Plus accrued interest from September 30, 1997.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
(3) Before deducting expenses payable by the Company, estimated to be $100,000.
</TABLE>
--------------
The Notes are offered severally by the Underwriters, as specified herein,
subject to receipt and acceptance by them and subject to their right to reject
any order in whole or in part. It is expected that the Notes will be ready for
delivery in book-entry form only through the facilities of DTC in New York, New
York, on or about September 30, 1997 against payment therefor in immediately
available funds.
GOLDMAN, SACHS & CO.
CHASE SECURITIES INC.
MERRILL LYNCH & CO.
---------
The date of this Prospectus Supplement is September 25, 1997.
<PAGE>
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE NOTES OFFERED
HEREBY, INCLUDING OVER-ALLOTMENT, STABILIZING AND SHORT-COVERING TRANSACTIONS IN
SUCH NOTES, AND THE IMPOSITION OF A PENALTY BID, IN CONNECTION WITH THIS
OFFERING. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING".
--------------
THE COMPANY
Sonat Inc. (the "Company" or "Sonat"), a Delaware corporation organized in
1973, is a diversified energy holding company. It is engaged through Sonat
Exploration Company ("Exploration") in domestic oil and natural gas exploration
and production, through Southern Natural Gas Company ("Southern") and Citrus
Corp. ("Citrus") in the interstate transmission and storage of natural gas, and
through Sonat Energy Services Company ("Energy Services") in natural gas and
electric power marketing. The Company disposed of its remaining shares of Sonat
Offshore Drilling Inc., a former subsidiary referred to in the Prospectus, in
1995.
Exploration, which is an independent oil and gas producer, operates
primarily in Texas, Oklahoma, Louisiana, Arkansas, and the Gulf of Mexico. Oil
and gas exploration and production activities contributed approximately 47
percent of Sonat's consolidated operating income for 1996.
Southern is a major transporter of natural gas to the southeastern United
States. Its natural gas pipeline system extends primarily from gas producing
areas of Texas and Louisiana, both onshore and offshore, to markets in a
seven-state area of the Southeast. Sonat and Enron Corp., an unaffiliated
company, each owns a one-half interest in Citrus, a holding company that owns
100 percent of Florida Gas Transmission Company ("Florida Gas"). Florida Gas is
an interstate natural gas pipeline that serves electric generation, resale, and
industrial markets in Florida. Natural gas transmission operations, excluding
Citrus, contributed approximately 49 percent of Sonat's consolidated operating
income for 1996. Sonat's share of Citrus' earnings is reflected in Equity in
Earnings of Unconsolidated Affiliates.
Energy Services' largest subsidiary, Sonat Marketing Company L.P.
("Marketing"), sells natural gas throughout much of the United States. Marketing
is 65-percent owned by a subsidiary of Energy Services, with the remaining
interest owned by a subsidiary of AGL Resources, Inc., an unaffiliated company
("AGL Resources"). At year-end 1996, Marketing was one of the ten largest
natural gas marketers in the United States. Energy Services owns 65 percent of
Sonat Power Marketing L.P. ("Power Marketing"), which markets electric power
throughout much of the United States. AGL Resources owns the other 35 percent of
Power Marketing. Energy Service's marketing activities contributed approximately
three percent of Sonat's consolidated operating income for 1996, inclusive of
the minority interests.
RECENT DEVELOPMENTS
On September 9, 1997, the Company issued a press release updating
Exploration's drilling results in the Cotton Valley Pinnacle Reef trend of East
Texas and other areas. The Company reported that Exploration has a lease
position totalling some 404,000 acres in the Cotton Valley Pinnacle Reef trend
of East Texas. Exploration acts as operator for wells drilled on this acreage,
and its overall working interest averages approximately 65 percent. Exploration
has completed five producing wells and drilled two dry holes in the seven wells
it has drilled thus far in the trend.
In addition to such seven wells, Exploration recently finished the drilling
and initial evaluation of three Pinnacle Reef discoveries. The most significant
discovery is the Sonat Morris Lazy K No.1, located on a 1,200-acre lease block
southeast of Jewett in Leon County, Texas. The Sonat Morris Lazy K No.1 was
drilled to a total depth of 17,952 feet and penetrated 1,320 feet of reefal
limestone in the interval from 16,580 to 17,900 feet. Based on petrophysical and
geological analyses and gas shows recorded in the entire reef interval,
Exploration anticipates the well should be completed as a significant producer.
Exploration earned a 50 percent working interest in the discovery under a
farm-out agreement with Amoco through drilling the well.
S-2
<PAGE>
In the Bear Grass area of Freestone and Leon counties, Texas, Exploration
has another indicated discovery at the Sonat Laura Lee No.1 well. The well was
drilled to a total depth of 15,150 feet and encountered 400 feet of reefal
limestone in the interval from 14,570 to 14,970 feet. Based on petrophysical and
geological analyses as well as gas shows, Exploration anticipates the Laura Lee
No. 1 well will also be completed as a high-quality gas producer. Exploration's
working interest in the well is 70 percent. Exploration has another indicated
discovery in the Bear Grass area at the Blazek No. 5 well, in which Exploration
has a 61% interest.
Due to delays in putting several wells on production and production
constraints caused by pipeline capacity and pressures and some unanticipated
declines in production in the Gulf Coast Region, Exploration has lowered its
estimate of 1997 production from 270 billion cubic feet of natural gas
equivalent ("Bcfe") to 250 to 255 Bcfe.
FORWARD-LOOKING STATEMENTS
The information in this prospectus supplement includes certain
forward-looking statements that are based on assumptions the Company believes
are reasonable, but a variety of factors could cause the Company's actual
results and experience to differ materially from the results in the Company's
forward-looking statements. While the Company currently anticipates that the
Morris Lazy K No. 1 and the Laura Lee No. 1 wells will be successful, a final
determination will be made only after completion and testing. In addition, there
can be no assurance that the actual level of production from existing wells and
the wells to be drilled in Exploration's exploratory and development drilling
programs will equal reforecasted volumes. A description of the factors affecting
the success of Exploration's drilling programs and production is set forth in
Part I of the Company's Annual Report on Form 10-K for the year ended December
31, 1996, in Item 1 of Part I thereof under the caption "Forward-Looking
Statements" and in the Company's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1997, in Item 2 of Part I thereof under the caption "Forward
Looking Statements".
USE OF PROCEEDS
The net proceeds from the sale of the Notes, together with the net proceeds
from the concurrent sale by Southern of $100 million of notes that will be
loaned by Southern to the Company on a short-term basis, will be used to repay
amounts borrowed by the Company under its commercial paper program (which are
due in October 1997) and under its revolving credit agreement with banks (which
terminates in June 2001), with interest rates ranging from approximately 5.70%
to 5.80%, and, pending application of the net proceeds for such purposes, will
be invested in short-term investments. Such borrowings being repaid were used
for general corporate purposes of the Company, including capital expenditures
and working capital.
RATIOS OF EARNINGS FROM CONTINUING OPERATIONS
TO FIXED CHARGES
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
JUNE 30, YEARS ENDED DECEMBER 31,
--------------- --------------------------------------------------
1997 1996 1995 1994 1993
--------------- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
Total Enterprise............................................... 3.0 2.9 2.7 2.2 3.8
<CAPTION>
1992
-----
<S> <C>
Total Enterprise............................................... 1.8
</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.
S-3
<PAGE>
DESCRIPTION OF NOTES
THE FOLLOWING DESCRIPTION OF THE TERMS OF THE NOTES OFFERED HEREBY (REFERRED
TO IN THE PROSPECTUS AS THE "OFFERED DEBT SECURITIES") SUPPLEMENTS, AND TO THE
EXTENT INCONSISTENT THEREWITH REPLACES, INSOFAR AS SUCH DESCRIPTION RELATES TO
THE NOTES, THE DESCRIPTION OF THE OFFERED DEBT SECURITIES SET FORTH IN THE
PROSPECTUS, TO WHICH DESCRIPTION REFERENCE IS HEREBY MADE.
GENERAL
The Notes are to be issued under an Indenture, dated as of June 1, 1986,
between the Company and The Chase Manhattan Bank, as successor by merger to
Manufacturers Hanover Trust Company and Chemical Bank, as Trustee (the
"Trustee"), as supplemented by the First Supplemental Indenture, dated as of
June 1, 1995, between the Company and the Trustee.
The Notes will be limited to $100,000,000 aggregate principal amount and
will mature on October 1, 2007. The Notes will bear interest at the rate per
annum shown on the cover page of this Prospectus Supplement from September 30,
1997, or from the most recent Interest Payment Date to which interest has been
paid or provided for, payable semi-annually on April 1 and October 1 of each
year, commencing April 1, 1998, to the person in whose name a Note (or any
predecessor Note) is registered at the close of business on the March 15 or
September 15, as the case may be, next preceding such Interest Payment Date.
The Notes will not be redeemable prior to maturity and will not be entitled
to the benefit of any sinking fund.
The Notes are subject to defeasance and covenant defeasance as described
under "Description of Debt Securities -- Defeasance and Covenant Defeasance" in
the Prospectus. As more fully discussed therein, it is likely that a defeasance
of the Notes by the Company would result in a taxable event to the holders of
the Notes under current Federal income tax law.
BOOK-ENTRY SYSTEM
The Notes will 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.
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 Securities Exchange Act of
1934, as amended. 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 Notes 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
S-4
<PAGE>
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 Notes for all
purposes of such Notes 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 Notes represented by such Global Notes registered in their
names, will not receive or be entitled to receive physical delivery of
certificated Notes in definitive form and will not be considered to be the
owners or holders of any Notes 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 Notes 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 Notes 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 Notes 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 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
Notes 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 Notes represented by the Global Notes are exchangeable for certificated
Notes in definitive registered form of like tenor as such Notes 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 Securities Exchange Act of 1934, as
amended, (ii) the Company in its discretion at any time determines not to have
all of the Notes represented by the Global Notes and notifies the Trustee
thereof or (iii) an Event of Default with respect to the Notes represented by
such
S-5
<PAGE>
Global Notes has occurred and is continuing. Any Notes that are exchangeable
pursuant to the preceding sentence are exchangeable for certificated Notes
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.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement,
the Company has agreed to sell to each of the Underwriters named below, and each
of the Underwriters has severally agreed to purchase, the principal amount of
the Notes set forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
UNDERWRITER OF NOTES
- ------------------------------------------------------------------------------------- -----------------
<S> <C>
Goldman, Sachs & Co. ................................................................ $ 33,400,000
Chase Securities Inc................................................................. 33,300,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated................................... 33,300,000
-----------------
Total............................................................................ $ 100,000,000
-----------------
-----------------
</TABLE>
Under the terms and conditions of the Underwriting Agreement, the
Underwriters are committed to take and pay for all the Notes, if any are taken.
The Underwriters propose to offer the Notes in part directly to the public
at the initial public offering price set forth on the cover page of this
Prospectus Supplement, and in part to certain securities dealers at such price
less a concession of 0.40% of the principal amount of the Notes. The
Underwriters may allow, and such dealers may reallow, a concession not to exceed
0.25% of the principal amount of the Notes to certain brokers and dealers. After
the Notes are released for sale to the public, the offering price and other
selling terms may from time to time be varied by the Underwriters.
The Company has agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as amended.
The Notes are a new issue of securities with no established trading market.
The Company has been advised by the Underwriters that they intend to make a
market in the Notes, but are under no obligation to do so and such market making
may be terminated at any time without notice. No assurance can be given as to
the liquidity of the trading market for the Notes.
In the ordinary course of their respective businesses, each of the
Underwriters and their affiliates have provided, and may in the future provide,
investment banking and/or commercial banking services for the Company and its
affiliates. William O. Bourke and John J. Phelan, directors of the Company, are
also directors of the parent corporation of Merrill Lynch, Pierce, Fenner &
Smith Incorporated, one of the Underwriters. The Chase Manhattan Bank, an
affiliate of Chase Securities Inc., one of the Underwriters, is a co-agent bank
for one of the Company's bank credit agreements. More than 10% of the net
proceeds from the offering of the Notes may be used to repay indebtedness owing
to The Chase Manhattan Bank and other affiliates of Chase Securities Inc. See
"Use of Proceeds". Accordingly, this offering is being made in accordance with
Section 2710(c)(8) of the Conduct Rules of the National Association of
Securities Dealers, Inc.
In connection with the offering of the Notes, the Underwriters may purchase
and sell the Notes in the open market. These transactions may include
over-allotment and stabilizing transactions and purchases to cover syndicate
short positions created in connection with the offering. Stabilizing
transactions consist of certain bids or purchases for the purpose of preventing
or retarding a decline in the market price of the Notes; and syndicate short
positions involve the sale by the Underwriters of a greater number of Notes than
they are required to purchase from the Company in the offering. The Underwriters
also may impose a penalty bid, whereby selling concessions allowed to syndicate
members or other
S-6
<PAGE>
broker-dealers in respect of the Notes sold in the offering for their account
may be reclaimed by the syndicate if such Notes are repurchased by the syndicate
in stabilizing or covering transactions. These activities may stabilize,
maintain or otherwise affect the market price of the Notes which may be higher
than the price that might otherwise prevail in the open market; and these
activities, if commenced, may be discontinued at any time. These transactions
may be effected in the over-the-counter market or otherwise.
VALIDITY OF THE NOTES
The validity of the Notes will be passed upon for the Company by Hughes
Hubbard & Reed LLP, and for the Underwriters by Sullivan & Cromwell, New York,
New York. L. Edwin Smart, Counsel to Hughes Hubbard & Reed LLP, has retired as a
director of the Company.
EXPERTS
The consolidated financial statements of Sonat Inc. and subsidiaries
appearing in Sonat's Annual Report (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 thereon included therein and incorporated in the Prospectus by
reference. Such consolidated financial statements are incorporated herein by
reference in reliance upon such report given upon the authority of such firm as
experts in accounting and auditing.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company incorporates herein by reference its Annual Report on Form 10-K
for the year ended December 31, 1996 and its Quarterly Reports on Form 10-Q for
the quarters ended March 31 and June 30, 1997, filed under the Securities
Exchange Act of 1934 (the "Exchange Act") with the Securities and Exchange
Commission (the "Commission").
Reference is made to the information under "Incorporation of Certain
Documents by Reference" in the accompanying Prospectus. All documents filed
under the Exchange Act with the Commission prior to January 1, 1997 and
incorporated by reference in the Prospectus have been superseded by the
above-listed documents and shall not be deemed to constitute a part of the
Prospectus or this Prospectus Supplement.
S-7
<PAGE>
- ----------------------------------------------
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE
PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT AND THE
PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO
BUY ANY SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS PROSPECTUS
SUPPLEMENT OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SUCH
SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL.
NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS 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 THAT THE INFORMATION CONTAINED HEREIN OR THEREIN IS CORRECT
AS OF ANY TIME SUBSEQUENT TO ITS DATE.
--------------
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
The Company........................................ S-2
Use of Proceeds.................................... S-3
Ratios of Earnings from Continuing Operations to
Fixed Charges..................................... S-3
Description of Notes............................... S-4
Underwriting....................................... S-6
Validity of the Notes.............................. S-7
Experts............................................ S-7
Incorporation by Reference......................... S-7
PROSPECTUS
Available Information.............................. 2
Incorporation of Certain Documents by Reference.... 2
The Company........................................ 3
Use of Proceeds.................................... 3
Capital Expenditure Budget......................... 3
Ratios of Earnings from Continuing Operations to
Fixed Charges..................................... 4
Description of Debt Securities..................... 4
Plan of Distribution............................... 8
Legal Opinions..................................... 9
Experts............................................ 9
</TABLE>
$100,000,000
SONAT INC.
6.75% NOTES
DUE OCTOBER 1, 2007
-----------
PROSPECTUS SUPPLEMENT
-----------
GOLDMAN, SACHS & CO.
CHASE SECURITIES INC.
MERRILL LYNCH & CO.
- ----------------------------------------------
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- ----------------------------------------------
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