<PAGE>
REGISTRATION NO. 333-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
SONAT INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 63-0647939
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
AMSOUTH-SONAT TOWER
BIRMINGHAM, ALABAMA 35203
(205) 325-3800
(Address, including zip code, and telephone number, including area code, of registrant's
principal executive offices)
</TABLE>
------------------------
WILLIAM A. SMITH
AMSOUTH-SONAT TOWER
BIRMINGHAM, ALABAMA 35203
(205) 325-7410
(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, NY 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 PROPOSED
TITLE OF EACH CLASS AMOUNT MAXIMUM MAXIMUM
OF SECURITIES TO BE TO BE OFFERING AGGREGATE AMOUNT OF
REGISTERED REGISTERED PRICE PER UNIT OFFERING PRICE REGISTRATION FEE
<S> <C> <C> <C> <C>
Debt Securities..................... $500,000,000 100%* $500,000,000 $147,500
</TABLE>
*Plus accrued interest, if any. 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>
SONAT INC.
DEBT SECURITIES
---------------
Sonat Inc. (the "Company" or "Sonat") may offer from time to time up to
$500,000,000 aggregate principal amount or the equivalent thereof in one or more
currency units of its debt securities (the "Debt Securities") in one or more
series, at prices and 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." 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 , 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, proxy or information statements and other information
with the Securities and Exchange Commission (the "Commission"). Such reports,
proxy or information statements and other information can be inspected and
copied at the public reference facilities maintained by the Commission at
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, Room 1024, and
at the Commission's Regional Offices in New York (Seven World Trade Center, New
York, NY 10048) and Chicago (Citicorp Center, 500 West Madison Street, Suite
1400, Chicago, IL 60661). Copies of such material can be obtained by mail from
the Public Reference Section of the Commission at Judiciary Plaza, 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. Certain of the Company's securities are listed on the New York Stock
Exchange, Inc. and the Pacific Stock Exchange. Reports, proxy or information
statements and other information can be inspected at the offices of the New York
Stock Exchange, Inc., 20 Broad Street, New York, NY 10005 and the Pacific Stock
Exchange, 301 Pine Street, San Francisco, CA 94104.
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, 1997 (excluding the consolidated financial
statements set forth under Item 8 of such Report); (b) Quarterly Reports on Form
10-Q for the quarters ended March 31 and June 30, 1998; and (c) Current Reports
on Form 8-K, dated January 22, January 29, February 2, February 4, April 23, and
July 23, 1998.
All documents filed by the Company pursuant to Section 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 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
2
<PAGE>
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company hereby undertakes to provide without charge to each person to
whom this Prospectus is delivered, on the written or oral request of such
person, a copy of any or all of the documents referred to above which have been
or may be incorporated in this Prospectus by reference, other than exhibits to
such documents. Such requests should be directed to Secretary, Sonat Inc., P.O.
Box 2563, Birmingham, AL 35202 (telephone: (205) 325-7104).
THE COMPANY
Sonat is a diversified energy holding company. It is engaged through Sonat
Exploration Company ("Exploration") and Sonat Exploration GOM Inc. ("Sonat GOM")
in domestic oil and natural gas exploration and production, through Southern
Natural Gas Company ("Southern") and Citrus Corp. ("Citrus") in the transmission
and storage of natural gas, and through Sonat Energy Services Company ("Sonat
Energy Services") in natural gas and electric power marketing.
Exploration, which is an independent oil and gas producer, operates
primarily in Texas, Oklahoma, Louisiana, and the Gulf of Mexico. In January 1998
Sonat completed a $1.3 billion merger with Zilkha Energy Company ("Zilkha"), a
privately owned oil and gas exploration, development, and production company
operating primarily offshore in the shallow waters of the Gulf of Mexico, which
was accounted for on a "pooling-of-interests" basis. Following the merger,
Zilkha was renamed Sonat GOM.
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.
Sonat Energy Services' largest subsidiary, Sonat Marketing Company L.P.
("Sonat Marketing"), sells natural gas throughout much of the United States,
principally the area east of the Rocky Mountains. Sonat Marketing is 65-percent
owned by a subsidiary of Sonat Energy Services, with the remaining interest
owned by a subsidiary of AGL Resources, Inc., an unaffiliated company ("AGL
Resources"). Sonat Energy Services owns 65 percent of Sonat Power Marketing L.P.
("Power Marketing"), which markets electric power throughout the area of the
United States east of the Rocky Mountains. AGL Resources owns the remaining 35
percent interest in Power Marketing. During 1998, Sonat Energy Services acquired
an interest in two natural gas fired electric generation plants in Georgia.
The Company's principal executive offices are located at 1900 Fifth Avenue
North, AmSouth-Sonat Tower, Birmingham, AL 35203 and its principal mailing
address is P. O. Box 2563, Birmingham, AL 35202. The Company's telephone number
at its principal executive offices is (205) 325-3800.
3
<PAGE>
USE OF PROCEEDS
Unless otherwise provided in the Prospectus Supplement, the net proceeds
from the sale of the Offered Debt Securities will be used for general corporate
purposes, which may include refinancing of indebtedness, working capital
increases, capital expenditures, possible future acquisitions and redemption of
securities. Depending upon market conditions, the Company may obtain funds to
finance these expenditures from bank borrowings or the sale of commercial paper
and later repay such borrowings with the proceeds from the sale of Debt
Securities, or the Company may invest all or part of such proceeds in short-term
money market instruments pending utilization of such proceeds. The Company may
also engage in additional public or private financings of a character and amount
to be determined.
RATIOS OF EARNINGS FROM CONTINUING OPERATIONS
TO FIXED CHARGES
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, YEARS ENDED DECEMBER 31,
----------------- -------------------------------------------------------------
1998 1997 1996 1995 1994 1993
----------------- --------- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
Total Enterprise.......................... -- (a) 1.7 3.1 2.7 2.0 3.7
</TABLE>
- ------------------------
(a) Earnings from continuing operations for the six months ended June 30, 1998,
reflect a second quarter restructuring charge for the impairment of certain
oil and gas properties and other restructuring expenses primarily associated
with a reduction in work force. Earnings for the second quarter were reduced
$444.8 million before taxes ($289.1 million after taxes) as a result of the
restructuring and impairment charges, resulting in a net loss for the six
months ended June 30, 1998 of $220.0 million. Because of these charges,
earnings were inadequate to cover fixed charges of $95.8 million for the six
months ended June 30, 1998. The earnings (as defined for purposes of this
ratio) coverage deficiency was $347.9 million for the six month period.
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.
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,
1986, between the Company and The Chase Manhattan Bank (formerly Chemical Bank,
successor by merger to Manufacturers Hanover Trust Company), as Trustee (the
"Trustee"), as supplemented by the First Supplemental Indenture, dated as of
June 1, 1995, 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.
4
<PAGE>
GENERAL
The Indenture does not limit the aggregate principal amount of Debt
Securities 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 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.
5
<PAGE>
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.
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 with respect to such Debt Securities. 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.
6
<PAGE>
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 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 Debt Securities 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 may not grant a Lien (as defined below) to
secure any indebtedness for borrowed money, or any guarantee or indemnity in
respect thereof, upon, or with respect to, any capital stock of any Restricted
Subsidiary (as defined below) owned directly or indirectly by the Company, or
upon, or with respect to, any capital stock of any other Subsidiary owned
directly by the Company, in each case unless the Company shall, simultaneously
therewith or prior thereto, take any and all action necessary to procure that
all amounts payable by it under the Offered Debt Securities are secured equally
and ratably with (or prior to) such indebtedness (or such guarantee or indemnity
in respect thereof, as the case may be); PROVIDED that the foregoing does not
prevent the Company from selling, conveying, distributing (through a dividend or
otherwise) or transferring any or all of the capital stock of any Restricted
Subsidiary or any other Subsidiary. (Section 6.04.)
The holders of a majority in principal amount of the outstanding Debt
Securities of any series may waive compliance by the Company with the covenant
contained in Section 6.04 of the Indenture with respect to such series of Debt
Securities. (Section 6.08.)
7
<PAGE>
The term "Restricted Subsidiary" means Southern and Exploration, each of
which is a Delaware corporation and was a subsidiary of the Company as of the
date of the Indenture, and any Subsidiary of the Company which is a successor of
either of such corporations to which all or substantially all of the properties
and assets of either of such corporations have been transferred. (Section 1.01.)
The term "Subsidiary" means any corporation of which more than 50% of the
outstanding stock ordinarily entitled to vote shall at the time be owned by the
Company or by the Company in conjunction with one or more Subsidiaries or by one
or more Subsidiaries. (Section 1.01.)
The term "Lien" means any mortgage, pledge, lien, encumbrance or other
security interest which secures the payment or performance of an obligation.
(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, continued
for 30 days; (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 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 bankruptcy, insolvency or
reorganization with respect to the Company; or (f) any other Event of Default
provided with respect to Debt Securities of that series. A default under other
indebtedness of the Company will not be an Event of Default under the Indenture,
and 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. (Sections 8.06 and 9.02.)
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
6.04 of the Indenture (being the restrictions 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 should
9
<PAGE>
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 6.04 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, SALE, RESTRUCTURING OR HIGHLY LEVERAGED TRANSACTION
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 certain of the Company's
subsidiaries under other indentures, is a depositary of the Company, has from
time to time made loans to the Company and certain of its subsidiaries and has
performed other services for the Company and its subsidiaries in the normal
course of its business.
PLAN OF DISTRIBUTION
The Company may sell Debt Securities to or through underwriters or agents,
or directly to other purchasers. Underwriters may sell Offered Debt Securities
directly to other purchasers or through other dealers, who may receive
compensation from the underwriters in the form of discounts, concessions or
commissions. The Prospectus Supplement with respect to the Offered Debt
Securities sets forth the
10
<PAGE>
terms of the offering, 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 may authorize
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 and its subsidiaries in the ordinary course of
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 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 restated consolidated financial statements of Sonat Inc. and
Subsidiaries at December 31, 1997 and 1996, and for each of the three years in
the period ended December 31, 1997 appearing in the Sonat Inc. Current Report on
Form 8-K dated April 23, 1998, have been audited by Ernst & Young LLP,
independent auditors, as set forth in their report included therein and
incorporated herein by reference, which, as to the years 1996 and 1995, are
based on the report of KPMG Peat Marwick LLP, independent auditors. The report
of KPMG Peat Marwick LLP refers to a change by Zilkha Energy Company in
accounting for oil and gas properties from the full cost method to the
successful efforts method. Such restated consolidated financial statements are
incorporated herein by reference in reliance upon such reports given upon the
authority of such firms as experts in accounting and auditing.
The references to William M. Cobb & Associates, Inc. and to its reserve
report in the Sonat Inc. Annual Report on Form 10-K for the year ended December
31, 1997, are incorporated by reference herein in reliance upon the authority of
such firm as experts with respect to matters contained in its reserve report.
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 (14) of Article Fifth of the Restated Certificate of Incorporation
of the Company 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,
II-1
<PAGE>
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."
Section 145 of Chapter 1 of Title 8 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.
The Company has entered into indemnity agreements with each of its current
Directors. The agreements mandate that the Company 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 the Company or any
corporation, partnership, joint venture or other entity of which the Company
owns 50% or more of the voting or equity interest (an "Affiliate") or any
employee benefit plan of the Company 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 and the
Exchange Act. 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.
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 as of June 1, 1986, between the Registrant 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. 33-5947) and incorporated herein by reference
4-(2) First Supplemental Indenture, dated as of June 1, 1995, between the
Company and Trustee -- filed as Exhibit 4-(1) to the Company's
Current Report on Form 8-K dated June 6, 1995 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. 33-5947) 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. 33-5947) and incorporated herein by
reference
</TABLE>
II-2
<PAGE>
<TABLE>
<C> <S>
4-(5) Form of Extendible Note -- Filed as Exhibit 4-(4) to the Company's
Registration Statement on Form S-3 (No. 33-5947) and incorporated
herein by reference
4-(6) Form of Zero Coupon Note -- Filed as Exhibit 4-(5) to the Company's
Registration Statement on Form S-3 (No. 33-5947) and incorporated
herein by reference
4-(7) Form of Global Note -- Filed as Exhibit 4-(3) to the Company's
Current Report on Form 8-K dated September 29, 1997 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 Ernst & Young LLP, Independent Auditors
23-(2) The consent of Hughes Hubbard & Reed LLP is contained in its opinion
filed as Exhibit 5-(1) to this Registration Statement
23-(3) Consent of KPMG Peat Marwick LLP, Independent Auditors
23-(4) Consent of William M. Cobb & Associates, Inc., Independent Petroleum
Engineers
24-(1) Powers of Attorney
25-(1) Statement of Eligibility on Form T-1 under the Trust Indenture Act
of 1939 of The Chase Manhattan Bank (formerly 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. 33-5947 (Trust Act No.
22-15387).
II-3
<PAGE>
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 of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of a prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
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.
PROVIDED, HOWEVER, that paragraphs (1)(i) and (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.
II-4
<PAGE>
(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 27th day of
August, 1998.
<TABLE>
<S> <C> <C>
SONAT INC.
By: /s/ RONALD L. KUEHN, JR.
-----------------------------------------
Ronald L. Kuehn, Jr.
CHAIRMAN OF THE BOARD, PRESIDENT AND
CHIEF EXECUTIVE OFFICER
</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.
<TABLE>
<CAPTION>
SIGNATURE CAPACITY DATE
- ------------------------------ -------------------------- -------------------
<C> <S> <C>
(i) Principal Executive
Officer:
/s/ RONALD L. KUEHN, JR. Chairman of the Board,
- ------------------------------ President and August 27, 1998
(Ronald L. Kuehn, Jr.) Chief Executive Officer
(ii) Principal Financial and
Accounting Officer:
/s/ JAMES E. MOYLAN, JR.
- ------------------------------ Senior Vice President and August 27, 1998
(James E. Moylan, Jr.) Chief Financial Officer
</TABLE>
II-6
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE CAPACITY DATE
- ------------------------------ -------------------------- -------------------
<C> <S> <C>
(iii) Directors:
/s/ RONALD L. KUEHN, JR.*
- ------------------------------ August 27, 1998
(Ronald L. Kuehn, Jr.)
/s/ WILLIAM O. BOURKE*
- ------------------------------ August 27, 1998
(William O. Bourke)
/s/ ROBERT J. LANIGAN*
- ------------------------------ August 27, 1998
(Robert J. Lanigan)
/s/ MAX L. LUKENS*
- ------------------------------ August 27, 1998
(Max L. Lukens)
/s/ CHARLES MARSHALL*
- ------------------------------ August 27, 1998
(Charles Marshall)
/s/ BENJAMIN F. PAYTON*
- ------------------------------ August 27, 1998
(Benjamin F. Payton)
/s/ JOHN J. PHELAN, JR.*
- ------------------------------ August 27, 1998
(John J. Phelan, Jr.)
/s/ JEROME J. RICHARDSON*
- ------------------------------ August 27, 1998
(Jerome J. Richardson)
/s/ ADRIAN M. TOCKLIN*
- ------------------------------ August 27, 1998
(Adrian M. Tocklin)
/s/ JAMES B. WILLIAMS*
- ------------------------------ August 27, 1998
(James B. Williams)
/s/ JOE B. WYATT*
- ------------------------------ August 27, 1998
(Joe B. Wyatt)
/s/ MICHAEL S. ZILKHA*
- ------------------------------ August 27, 1998
(Michael S. Zilkha)
/s/ SELIM K. ZILKHA*
- ------------------------------ August 27, 1998
(Selim K. Zilkha)
</TABLE>
<TABLE>
<S> <C>
*By: /s/ JAMES E. MOYLAN,
JR.
-------------------------
James E. Moylan, Jr.
SENIOR VICE PRESIDENT AND
CHIEF FINANCIAL OFFICER
AS AUTHORIZED BY CERTAIN
POWERS OF ATTORNEY
FILED AS EXHIBIT 24-(1)
</TABLE>
II-7
<PAGE>
EXHIBIT INDEX
<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 as of June 1, 1986, between the Registrant 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. 33-5947) and incorporated herein by reference
4-(2) First Supplemental Indenture, dated as of June 1, 1995, between the
Company and Trustee -- filed as Exhibit 4-(1) to the Company's
Current Report on Form 8-K dated June 6, 1995 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. 33-5947) 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. 33-5947) and incorporated herein by
reference
4-(5) Form of Extendible Note -- Filed as Exhibit 4-(4) to the Company's
Registration Statement on Form S-3 (No. 33-5947) and incorporated
herein by reference
4-(6) Form of Zero Coupon Note -- Filed as Exhibit 4-(5) to the Company's
Registration Statement on Form S-3 (No. 33-5947) and incorporated
herein by reference
4-(7) Form of Global Note -- Filed as Exhibit 4-(3) to the Company's
Current Report on Form 8-K dated September 29, 1997 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 Ernst & Young LLP, Independent Auditors
23-(2) The consent of Hughes Hubbard & Reed LLP is contained in its opinion
filed as Exhibit 5-(1) to this Registration Statement
23-(3) Consent of KPMG Peat Marwick LLP, Independent Auditors
23-(4) Consent of William M. Cobb & Associates, Inc., Independent Petroleum
Engineers
24-(1) Powers of Attorney
25-(1) Statement of Eligibility on Form T-1 under the Trust Indenture Act
of 1939 of The Chase Manhattan Bank (formerly 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. 33-5947 (Trust Act No.
22-15387).
<PAGE>
Exhibit 1-(1)
UNDERWRITING AGREEMENT
----------------------
[Date]
Sonat Inc.,
Amsouth-Sonat Tower,
Birmingham, Alabama 35203.
Dear Sirs:
The underwriters named below (such underwriters being herein called the
"Underwriters") understand that Sonat Inc., a Delaware corporation (the
"Company"), proposes to issue and sell [$________] aggregate principal amount of
[________] (the "Purchased Securities"), registered on Registration Statement
No. [________]. 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.
Principal Amount
Name 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
[________].
<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 Sonat Inc. Underwriting Agreement Standard Provisions, dated
September 25, 1997, a copy of which was filed as an exhibit to Registration
Statement [______], 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 [________] , at the address set forth below.
<PAGE>
3
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.
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,
[________]
By:
----------------------------
Accepted:
SONAT INC.
By:
---------------------------
Name:
Title:
<PAGE>
Exhibit 1-(2)
SONAT INC.
DEBT SECURITIES
UNDERWRITING AGREEMENT STANDARD PROVISIONS
September 25, 1997
Sonat Inc., 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, 1986 as amended or supplemented from time to time (the "Indenture"),
between the Company and The Chase Manhattan Bank, as 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>
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
2
<PAGE>
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.
3
<PAGE>
(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
4
<PAGE>
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
5
<PAGE>
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
6
<PAGE>
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
7
<PAGE>
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 Registra-
8
<PAGE>
tion 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
9
<PAGE>
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
10
<PAGE>
provided by the 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 then 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 under this section to contribute are
several in proportion to their respective underwriting obligations and not
joint.
11
<PAGE>
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
(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
12
<PAGE>
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
(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.
13
<PAGE>
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.
14
<PAGE>
SCHEDULE I
DELAYED DELIVERY CONTRACT
__________, 19__
Dear Sirs:
The undersigned hereby agrees to purchase from Sonat Inc., 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, IF
DELIVERY DATE PRINCIPAL AMOUNT 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>
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.
2
<PAGE>
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:
SONAT INC.
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.
---- --------------------- -----
3
<PAGE>
ANNEX A
Pursuant to Section 5(f) of the Sonat Inc. 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, and is duly
qualified as a foreign corporation in the States of Alabama, New York, and
Texas.
(ii) Southern Natural Gas Company and Sonat Exploration Company were duly
incorporated and are validly existing as corporations 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 they are now engaged, as
described in the Prospectus, and the shares of capital stock of each such
corporation owned by the Company are duly and validly issued, fully paid and
nonassessable and, to such counsel's knowledge, are owned by the Company free
and clear of all mortgages, pledges, liens, encumbrances and other security
interests.
(iii) The Purchased Securities and the Indenture conform in all material
respects to the descriptions thereof in the Prospectus under the captions
"Description of Debt Securities" and "Description of Notes".
(iv) 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 that it has been duly authorized, executed and delivered
by the Trustee, shall constitute 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.
(v) 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.
(vi) 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 of the Trustee on Form T-1, the financial
<PAGE>
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).
(vii) 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.
(viii) 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
August 25, 1998
Sonat Inc.
AmSouth-Sonat Tower
Birmingham, Alabama 35203
Dear Sirs:
You have requested our opinion in connection with the Registration
Statement on Form S-3 to be filed by Sonat Inc. (the "Company") with the
Securities and Exchange Commission under the Securities Act of 1933, as amended,
to which this opinion letter will be filed as an exhibit, 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 the sale. The Debt Securities are to be
issued pursuant to an Indenture dated as of June 1, 1996, 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 June 1, 1995,
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)
SONAT INC. AND SUBSIDIARIES
Computation of Ratios of Earnings
from Continuing Operations to Fixed Charges
Total Enterprise (a)
<TABLE>
<CAPTION>
Six Months Ended
June 30, Years Ended December 31,
----------------- --------------------------------------------------------
1998 1997 1997 1996 1995 1994 1993
---- ---- ---- ---- ---- ---- ----
(In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings from Continuing Operations:
Income (loss) before income taxes $(345,026) $ 129,222 $ 122,849 $ 351,302 $ 300,373 $ 144,423 $ 354,325
Fixed charges (see computation below) 95,830 81,039 168,981 162,291 174,634 133,902 130,670
Less allowance for interest capitalized (2,872) (3,867) (7,447) (7,642) (8,072) (7,736) (4,329)
--------- --------- --------- --------- --------- --------- ---------
Total Earnings Available for Fixed Charges $(252,068) $ 206,394 $ 284,383 $ 505,951 $ 466,935 $ 270,589 $ 480,666
--------- --------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- --------- ---------
Fixed Charges:
Interest expense before deducting
interest capitalized $ 91,531 $ 77,062 $ 160,829 $ 154,769 $ 167,068 $ 126,193 $ 123,619
Rentals(b) 4,299 3,977 8,152 7,522 7,566 7,709 7,051
--------- --------- --------- --------- --------- --------- ---------
$ 95,830 $ 81,039 $ 168,981 $ 162,291 $ 174,634 $ 133,902 $ 130,670
--------- --------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- --------- ---------
Ratio of Earnings to Fixed Charges (c) 2.5 1.7 3.1 2.7 2.0 3.7
--------- --------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- --------- ---------
</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.
(c) Earnings from continuing operations for the six months ended June 30, 1998
reflect a second quarter restructuring charge for the impairment of
certain oil and gas properties and other restructuring expenses primarily
associated with a reduction in work force. Earnings for the second quarter
were reduced $444.8 million pretax and $289.1 million after tax as a
result of the restructuring and impairment charges. Because of these
charges, earnings were inadequate to cover fixed charges of $95.8 million
for the six months ended June 30, 1998. The coverage deficiency was $347.9
million for the six month period.
<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 Sonat Inc.
for the registration of $500,000,000 of debt securities and to the
incorporation by reference therein of our report dated April 20, 1998, with
respect to the restated consolidated financial statements of Sonat Inc.,
included in the Current Report on Form 8-K of Sonat Inc. dated April 23, 1998,
filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
Birmingham, Alabama
August 27, 1998
<PAGE>
EXHIBIT 23-(3)
The Board of Directors
Sonat Exploration GOM Inc.
(formerly Zilkha Energy Company)
We consent to the incorporation by reference in the registration statement to
be filed on Form S-3 by Sonat Inc. of our report dated December 8, 1997,
relating to the balance sheets of Zilkha Energy Company as of December 31,
1996, and 1995, and the related statements of earnings, retained earnings and
cash flows for each of the years in the three-year period ended December 31,
1996, which report appears in the Form 8-K of Sonat Inc. dated April 23, 1998.
Our report refers to a change in accounting for oil and gas properties from
the full cost method to the successful efforts method.
We also consent to the reference to our firm under the heading "Experts" in
the prospectus.
KPMG PEAT MARWICK LLP
Houston, Texas
August 25, 1998
<PAGE>
EXHIBIT 23-(4)
CONSENT OF INDEPENDENT PETROLEUM ENGINEERS
We hereby consent to the references to us and to the use of the information
derived from our reserve report on the interests of Sonat Exploration GOM
Inc. (formerly Zilkha Energy Company) ("Sonat GOM"), dated February 27, 1998,
relating to the estimated quantities of certain of Sonat GOM's proved
reserves, in the Sonat Inc. Annual Report on Form 10-K for 1997 under the
caption "Sonat Exploration GOM Inc." and to the incorporation by reference of
such references and information in the Registration Statement (Form S-3) and
the related Prospectus of Sonat Inc. for the registration of $500,000,000 of
debt securities. We also consent to our being named as experts for purposes
of such Registration Statement.
WILLIAM M. COBB & ASSOCIATES, INC.
By: /s/ Frank J. Marek
------------------------------
Frank J. Marek, P.E.
Vice President
Dallas, Texas
August 25, 1998
<PAGE>
EXHIBIT 24-(1)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, an officer and a
director of Sonat Inc. (the "Company"), does hereby constitute and appoint
Ronald L. Kuehn, Jr.; James E. Moylan, Jr.: and William A. Smith, and each of
them, his true and lawful attorneys to execute in his name (whether on behalf of
the Company or as an officer or director of the 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 at the meeting of the Board of Directors of
the Company on April 23, 1998, and with such terms and conditions as may be
fixed by subsequent actions of said Board of Directors, or of any Special or
Pricing 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 does 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 May
28, 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 a
director of Sonat Inc. (the "Company"), does hereby constitute and appoint
Ronald L. Kuehn, Jr.; James E. Moylan, Jr.: and William A. Smith, and each of
them, his true and lawful attorneys to execute in his name (whether on behalf of
the Company or as an officer or director of the 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 at the meeting of the Board of Directors of
the Company on April 23, 1998, and with such terms and conditions as may be
fixed by subsequent actions of said Board of Directors, or of any Special or
Pricing 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 does 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 May
28, 1998.
/s/ William O. Bourke
-----------------------------
William O. Bourke
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of Sonat
Inc. (the "Company"), does hereby constitute and appoint Ronald L. Kuehn, Jr.;
James E. Moylan, Jr.: and William A. Smith, and each of them, his true and
lawful attorneys to execute in his name (whether on behalf of the Company or as
an officer or director of the 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 at the meeting of the Board of Directors of the Company on
April 23, 1998, and with such terms and conditions as may be fixed by subsequent
actions of said Board of Directors, or of any Special or Pricing 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 does 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 May
28, 1998.
/s/ Robert J. Lanigan
--------------------------
Robert J. Lanigan
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of Sonat
Inc. (the "Company"), does hereby constitute and appoint Ronald L. Kuehn, Jr.;
James E. Moylan, Jr.: and William A. Smith, and each of them, his true and
lawful attorneys to execute in his name (whether on behalf of the Company or as
an officer or director of the 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 at the meeting of the Board of Directors of the Company on
April 23, 1998, and with such terms and conditions as may be fixed by subsequent
actions of said Board of Directors, or of any Special or Pricing 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 does 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 June
1, 1998.
/s/ Max Lukens
-------------------
Max Lukens
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of Sonat
Inc. (the "Company"), does hereby constitute and appoint Ronald L. Kuehn, Jr.;
James E. Moylan, Jr.: and William A. Smith, and each of them, his true and
lawful attorneys to execute in his name (whether on behalf of the Company or as
an officer or director of the 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 at the meeting of the Board of Directors of the Company on
April 23, 1998, and with such terms and conditions as may be fixed by subsequent
actions of said Board of Directors, or of any Special or Pricing 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 does 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 May
28, 1998.
/s/ Charles Marshall
---------------------------
Charles Marshall
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of Sonat
Inc. (the "Company"), does hereby constitute and appoint Ronald L. Kuehn, Jr.;
James E. Moylan, Jr.: and William A. Smith, and each of them, his true and
lawful attorneys to execute in his name (whether on behalf of the Company or as
an officer or director of the 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 at the meeting of the Board of Directors of the Company on
April 23, 1998, and with such terms and conditions as may be fixed by subsequent
actions of said Board of Directors, or of any Special or Pricing 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 does 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 May
28, 1998.
/s/ Benjamin F. Payton
----------------------------
Benjamin F. Payton
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of Sonat
Inc. (the "Company"), does hereby constitute and appoint Ronald L. Kuehn, Jr.;
James E. Moylan, Jr.: and William A. Smith, and each of them, his true and
lawful attorneys to execute in his name (whether on behalf of the Company or as
an officer or director of the 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 at the meeting of the Board of Directors of the Company on
April 23, 1998, and with such terms and conditions as may be fixed by subsequent
actions of said Board of Directors, or of any Special or Pricing 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 does 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 May
28, 1998.
/s/ John J. Phelan, Jr.
------------------------------
John J. Phelan, Jr.
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of Sonat
Inc. (the "Company"), does hereby constitute and appoint Ronald L. Kuehn, Jr.;
James E. Moylan, Jr.: and William A. Smith, and each of them, his true and
lawful attorneys to execute in his name (whether on behalf of the Company or as
an officer or director of the 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 at the meeting of the Board of Directors of the Company on
April 23, 1998, and with such terms and conditions as may be fixed by subsequent
actions of said Board of Directors, or of any Special or Pricing 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 does 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 May
28, 1998.
/s/ Adrian M. Tocklin
---------------------------
Adrian M. Tocklin
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of Sonat
Inc. (the "Company"), does hereby constitute and appoint Ronald L. Kuehn, Jr.;
James E. Moylan, Jr.: and William A. Smith, and each of them, his true and
lawful attorneys to execute in his name (whether on behalf of the Company or as
an officer or director of the 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 at the meeting of the Board of Directors of the Company on
April 23, 1998, and with such terms and conditions as may be fixed by subsequent
actions of said Board of Directors, or of any Special or Pricing 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 does 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 May
28, 1998.
/s/ Jerome J. Richardson
-------------------------------
Jerome J. Richardson
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of Sonat
Inc. (the "Company"), does hereby constitute and appoint Ronald L. Kuehn, Jr.;
James E. Moylan, Jr.: and William A. Smith, and each of them, his true and
lawful attorneys to execute in his name (whether on behalf of the Company or as
an officer or director of the 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 at the meeting of the Board of Directors of the Company on
April 23, 1998, and with such terms and conditions as may be fixed by subsequent
actions of said Board of Directors, or of any Special or Pricing 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 does 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 May
28, 1998.
/s/ James B. Williams
-----------------------------
James B. Williams
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of Sonat
Inc. (the "Company"), does hereby constitute and appoint Ronald L. Kuehn, Jr.;
James E. Moylan, Jr.: and William A. Smith, and each of them, his true and
lawful attorneys to execute in his name (whether on behalf of the Company or as
an officer or director of the 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 at the meeting of the Board of Directors of the Company on
April 23, 1998, and with such terms and conditions as may be fixed by subsequent
actions of said Board of Directors, or of any Special or Pricing 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 does 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 May
28, 1998.
/s/ Joe B. Wyatt
-------------------------
Joe B. Wyatt
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of Sonat
Inc. (the "Company"), does hereby constitute and appoint Ronald L. Kuehn, Jr.;
James E. Moylan, Jr.: and William A. Smith, and each of them, his true and
lawful attorneys to execute in his name (whether on behalf of the Company or as
an officer or director of the 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 at the meeting of the Board of Directors of the Company on
April 23, 1998, and with such terms and conditions as may be fixed by subsequent
actions of said Board of Directors, or of any Special or Pricing 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 does 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 May
28, 1998.
/s/ Michael S. Zilkha
----------------------------
Michael S. Zilkha
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of Sonat
Inc. (the "Company"), does hereby constitute and appoint Ronald L. Kuehn, Jr.;
James E. Moylan, Jr.: and William A. Smith, and each of them, his true and
lawful attorneys to execute in his name (whether on behalf of the Company or as
an officer or director of the 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 at the meeting of the Board of Directors of the Company on
April 23, 1998, and with such terms and conditions as may be fixed by subsequent
actions of said Board of Directors, or of any Special or Pricing 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 does 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 May
28, 1998.
/s/ Selim K. Zilkha
---------------------------
Selim K. Zilkha
<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)
----------------------------------------
SONAT INC.
(Exact name of obligor as specified in its charter)
DELAWARE 63-0647939
(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.
<PAGE>
-3-
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 19th day of August, 1998.
THE CHASE MANHATTAN BANK
By /s/ T. J. Foley
----------------------------
T. J. Foley
Vice President
<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 June 30, 1998, 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 .................................. 12,546
Interest-bearing balances .......................... 6,610
Securities: ............................................
Held to maturity securities......................... 2,014
Available for sale securities............................ 46,342
Federal funds sold and securities purchased under
agreements to resell ............................... 27,489
Loans and lease financing receivables:
Loans and leases, net of unearned income $129,281
Less: Allowance for loan and lease losses 2,796
Less: Allocated transfer risk reserve 0
--------
Loans and leases, net of unearned income,
allowance, and reserve .............................. 126,485
Trading Assets ........................................... 58,015
Premises and fixed assets (including capitalized
leases).............................................. 3,001
Other real estate owned .................................. 260
Investments in unconsolidated subsidiaries and
associated companies................................. 255
Customers' liability to this bank on acceptances
outstanding ......................................... 1,245
Intangible assets ........................................ 1,492
Other assets ............................................. 16,408
--------
TOTAL ASSETS .............................................$302,162
========
-4-
<PAGE>
LIABILITIES
Deposits
In domestic offices .................... $99,347
Noninterest-bearing .................... $41,566
Interest-bearing ....................... 57,781
-------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's.................. 80,602
Noninterest-bearing .................... $ 4,109
Interest-bearing ....................... 76,493
Federal funds purchased and securities sold under agree-
ments to repurchase.......................... 37,760
Demand notes issued to the U.S. Treasury .... 1,000
Trading liabilities ......................... 42,941
Other borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less 4,162
With a remaining maturity of more than one year .
through three years..................... 213
With a remaining maturity of more than three years 106
Bank's liability on acceptances executed and outstanding 1,245
Subordinated notes and debentures ........... 5,408
Other liabilities............................ 11,796
TOTAL LIABILITIES ........................... 284,580
-------
EQUITY CAPITAL
Perpetual preferred stock and related surplus 0
Common stock................................. 1,211
Surplus (exclude all surplus related to preferred stock) 10,441
Undivided profits and capital reserves ...... 5,916
Net unrealized holding gains (losses)
on available-for-sale securities .......... (2)
Cumulative foreign currency translation adjustments 16
TOTAL EQUITY CAPITAL ........................ 17,582
--------
TOTAL LIABILITIES AND EQUITY CAPITAL ........ $302,162
========
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 instructions
issued by the appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR. )
-5-
