SC 13D/A 1 p08-1454sc13da.txt SOUTHERN UNION COMPANY UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------- SCHEDULE 13D (Rule 13d-101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a) Under the Securities Exchange Act of 1934 (Amendment No. 7)* Southern Union Company -------------------------------------------------------------------------------- (Name of Issuer) Common Stock -------------------------------------------------------------------------------- (Title of Class of Securities) 844030106 -------------------------------------------------------------------------------- (CUSIP Number) Sandell Asset Management Corp. 40 West 57th Street 26th Floor New York, NY 10019 Attention: Richard Gashler, General Counsel 212-603-5700 With a Copy to: Marc Weingarten, Esq. David Rosewater, Esq. Schulte Roth & Zabel LLP 919 Third Avenue New York, NY 10019 212-756-2000 -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) December 5, 2008 ----------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box [ ]. Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent. (Continued on following pages) (Page 1 of 10 Pages) -------------------- * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). ---------------------------- ---------------------------- CUSIP No. 844030106 SCHEDULE 13D/A Page 2 of 10 Pages ---------------------------- ---------------------------- ------------- ----------------------------------------------------------------- 1 NAME OF REPORTING PERSON Castlerigg Master Investments Ltd. ------------- ----------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |_| ------------- ----------------------------------------------------------------- 3 SEC USE ONLY ------------- ----------------------------------------------------------------- 4 SOURCE OF FUNDS WC ------------- ----------------------------------------------------------------- 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) |_| ------------- ----------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION British Virgin Islands ------------- ----------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 0 ----------- ----------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER OWNED 12,250,714 ----------- ----------------------------------------------------- BY EACH 9 SOLE DISPOSITIVE POWER REPORTING 0 ----------- ----------------------------------------------------- PERSON 10 SHARED DISPOSITIVE POWER 12,250,714 WITH ------------- ----------- ----------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 12,250,714 ------------- ----------------------------------------------------------------- 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES |_| ------------- ----------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 9.9% ------------- ----------------------------------------------------------------- 14 TYPE OF REPORTING PERSON CO ------------- ----------------------------------------------------------------- ---------------------------- ---------------------------- CUSIP No. 844030106 SCHEDULE 13D/A Page 3 of 10 Pages ---------------------------- ---------------------------- ------------- ----------------------------------------------------------------- 1 NAME OF REPORTING PERSON Sandell Asset Management Corp. ------------- ----------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |_| ------------- ----------------------------------------------------------------- 3 SEC USE ONLY ------------- ----------------------------------------------------------------- 4 SOURCE OF FUNDS AF ------------- ----------------------------------------------------------------- 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) |_| ------------- ----------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands ------------- ----------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 0 ----------- ----------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER OWNED 12,250,714 ----------- ----------------------------------------------------- BY EACH 9 SOLE DISPOSITIVE POWER REPORTING 0 ----------- ----------------------------------------------------- PERSON 10 SHARED DISPOSITIVE POWER 12,250,714 WITH ------------- ----------- ----------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 12,250,714 ------------- ----------------------------------------------------------------- 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES |_| ------------- ----------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 9.9% ------------- ----------------------------------------------------------------- 14 TYPE OF REPORTING PERSON CO ------------- ----------------------------------------------------------------- ---------------------------- ---------------------------- CUSIP No. 844030106 SCHEDULE 13D/A Page 4 of 10 Pages ---------------------------- ---------------------------- ------------- ----------------------------------------------------------------- 1 NAME OF REPORTING PERSON Castlerigg International Limited ------------- ----------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |_| ------------- ----------------------------------------------------------------- 3 SEC USE ONLY ------------- ----------------------------------------------------------------- 4 SOURCE OF FUNDS AF ------------- ----------------------------------------------------------------- 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) |_| ------------- ----------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION British Virgin Islands ------------- ----------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 0 ----------- ----------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER OWNED 12,250,714 ----------- ----------------------------------------------------- BY EACH 9 SOLE DISPOSITIVE POWER REPORTING 0 ----------- ----------------------------------------------------- PERSON 10 SHARED DISPOSITIVE POWER 12,250,714 WITH ------------- ----------- ----------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 12,250,714 ------------- ----------------------------------------------------------------- 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES |_| ------------- ----------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 9.9% ------------- ----------------------------------------------------------------- 14 TYPE OF REPORTING PERSON CO ------------- ----------------------------------------------------------------- ---------------------------- ---------------------------- CUSIP No. 844030106 SCHEDULE 13D/A Page 5 of 10 Pages ---------------------------- ---------------------------- ------------- ----------------------------------------------------------------- 1 NAME OF REPORTING PERSON Castlerigg International Holdings Limited ------------- ----------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |_| ------------- ----------------------------------------------------------------- 3 SEC USE ONLY ------------- ----------------------------------------------------------------- 4 SOURCE OF FUNDS AF ------------- ----------------------------------------------------------------- 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) |_| ------------- ----------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION British Virgin Islands ------------- ----------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 0 ----------- ----------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER OWNED 12,250,714 ----------- ----------------------------------------------------- BY EACH 9 SOLE DISPOSITIVE POWER REPORTING 0 ----------- ----------------------------------------------------- PERSON 10 SHARED DISPOSITIVE POWER 12,250,714 WITH ------------- ----------- ----------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 12,250,714 ------------- ----------------------------------------------------------------- 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES |_| ------------- ----------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 9.9% ------------- ----------------------------------------------------------------- 14 TYPE OF REPORTING PERSON CO ------------- ----------------------------------------------------------------- ---------------------------- ---------------------------- CUSIP No. 844030106 SCHEDULE 13D/A Page 6 of 10 Pages ---------------------------- ---------------------------- ------------- ----------------------------------------------------------------- 1 NAME OF REPORTING PERSON Thomas E. Sandell ------------- ----------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |_| ------------- ----------------------------------------------------------------- 3 SEC USE ONLY ------------- ----------------------------------------------------------------- 4 SOURCE OF FUNDS AF ------------- ----------------------------------------------------------------- 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) |_| ------------- ----------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Sweden ------------- ----------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 0 ----------- ----------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER OWNED 12,250,714 ----------- ----------------------------------------------------- BY EACH 9 SOLE DISPOSITIVE POWER REPORTING 0 ----------- ----------------------------------------------------- PERSON 10 SHARED DISPOSITIVE POWER 12,250,714 WITH ------------- ----------- ----------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 12,250,714 ------------- ----------------------------------------------------------------- 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES |_| ------------- ----------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 9.9% ------------- ----------------------------------------------------------------- 14 TYPE OF REPORTING PERSON IN ------------- ----------------------------------------------------------------- ---------------------------- ---------------------------- CUSIP No. 844030106 SCHEDULE 13D/A Page 7 of 10 Pages ---------------------------- ---------------------------- ------------- ----------------------------------------------------------------- 1 NAME OF REPORTING PERSON Nick Graziano ------------- ----------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |_| ------------- ----------------------------------------------------------------- 3 SEC USE ONLY ------------- ----------------------------------------------------------------- 4 SOURCE OF FUNDS PF ------------- ----------------------------------------------------------------- 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) |_| ------------- ----------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION United States ------------- ----------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 100 ----------- ----------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER OWNED 0 ----------- ----------------------------------------------------- BY EACH 9 SOLE DISPOSITIVE POWER REPORTING 100 ----------- ----------------------------------------------------- PERSON 10 SHARED DISPOSITIVE POWER 0 WITH ------------- ----------- ----------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 100 ------------- ----------------------------------------------------------------- 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES |_| ------------- ----------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 Less than 0.1% ------------- ----------------------------------------------------------------- 14 TYPE OF REPORTING PERSON IN ------------- ----------------------------------------------------------------- ---------------------------- ---------------------------- CUSIP No. 844030106 SCHEDULE 13D/A Page 8 of 10 Pages ---------------------------- ---------------------------- This Amendment No. 7 is filed with respect to the shares of the common stock, par value $1.00 per share (the "Common Stock"), of Southern Union Company, a Delaware corporation (the "Issuer"), beneficially owned by the Reporting Persons (as defined below) and amends and supplements the Schedule 13D, as heretofore amended (the "Schedule 13D"). Except as set forth herein, the Schedule 13D is unmodified. ITEM 2. IDENTITY AND BACKGROUND Paragraphs (a), (b), (c) and (f) of Item 2 of the Schedule 13D are hereby amended and supplemented as follows: (a) We are adding Nick Graziano (the "Nominee") as a Reporting Person for purposes of the Schedule 13D. The filing of this statement on Schedule 13D and any future amendments hereto, and the inclusion of information herein and therein, shall not be construed as an admission that any of the Reporting Persons, for the purpose of Section 13(d) of the Act or otherwise, is the beneficial owner of any shares of Common Stock which such person does not own. Without limiting the foregoing, the other Reporting Persons expressly disclaim beneficial ownership of the shares of Common Stock held by the Nominee and the Nominee expressly disclaims beneficial ownership of the shares of Common Stock held by any of the other Reporting Persons. (b) The principal business address for the Nominee is c/o Sandell Asset Management Corp., 40 West 57th Street, 26th Floor, New York, New York 10019. (c) The Nominee is a Managing Director of SAMC. (f) The Nominee is a citizen of the United States of America. ITEM 4. PURPOSE OF TRANSACTION Item 4 of the Schedule 13D is hereby amended by the addition of the following immediately preceding the penultimate paragraph thereof: On December 5, 2008, Castlerigg Master Investments delivered a notice to the Issuer informing the Issuer of its intention to propose four nominees for election to the board of directors at the Issuer's 2009 annual meeting of stockholders (the "2009 Annual Meeting") and complying with the formal notification process for Board nominations set forth in the Issuer's bylaws. The nominees are Stephen Beasley, Michael Egan, Keith Gollust and Nick Graziano (collectively, the "Nominees"). The Reporting Persons currently intend to conduct a proxy solicitation seeking to elect the Nominees to the Board at the 2009 Annual meeting. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER Paragraphs (a) and (c) of Item 5 of the Schedule 13D are hereby amended as follows: (a) Each of Castlerigg Master Investments, SAMC, Castlerigg International, Castlerigg Holdings and Sandell may be deemed to beneficially own the 12,250,714 shares of Common Stock held by Castlerigg Master Investments, representing approximately 9.9% of the outstanding shares of Common Stock. The Reporting Persons, including the Nominee, may be deemed to be a "group," which "group" may be deemed to beneficially own an aggregate of 12,250,814 shares of Common Stock, representing approximately 9.9% of the outstanding shares of Common Stock. However, the other Reporting Persons expressly disclaim beneficial ownership of the shares of Common Stock beneficially owned by the Nominee, and the Nominee expressly disclaims beneficial ownership of the shares of Common Stock owned by the other Reporting Persons. The filing of this statement on Schedule 13D and any future amendments hereto, and the inclusion of information herein and therein, shall not be construed as an admission that any of the Reporting Persons, for the purpose of Section 13(d) of the Act or otherwise, is the beneficial owner of any shares of Common Stock which such person does not own. The percentages used herein are based upon the 123,982,918 shares of Common Stock reported to be outstanding as of October 31, 2008 by the Issuer in its quarterly report on Form 10-Q for the period ended September 30, 2008. ---------------------------- ---------------------------- CUSIP No. 844030106 SCHEDULE 13D/A Page 9 of 10 Pages ---------------------------- ---------------------------- (c) No transactions in the shares of Common Stock were effected by the Reporting Persons during the past sixty days. ITEM 6. CONTRACTS, AGREEMENTS UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO THE SECURITIES OF THE ISSUER Item 6 of the Schedule 13D is hereby amended and supplemented as follows: The Nominees have entered into Nominee Agreements, dated December 4, 2008 (the "Nominee Agreements"), with SAMC pursuant to which each has agreed to stand for election to the Issuer's board of directors at the 2009 Annual Meeting and to serve as a director if elected, and, in the case of Mssrs. Gollust and Egan, pursuant to which each is entitled to receive specified compensation in connection with agreeing to serve as a nominee. This description of the Nominee Agreements is a summary only and is qualified by reference to the individual Nominee Agreements, copies of which are filed as Exhibits J, K, L and M to this Schedule 13D and are incorporated herein by reference. In addition, Eaton Group, Inc. ("Eaton Group"), an executive solutions and strategic investment company of which Mr. Beasley is the founder and Chief Executive Officer, has entered into a Consulting Services Agreement (the "Consulting Services Agreement"), dated December 4, 2008, with SAMC pursuant to which Eaton Group is entitled to receive a fee of $75,000, payable in monthly installments from February 2009 to June 2009, subject to extension, for consulting services to be provided by Mr. Beasley. In addition, Mr. Beasley is party to a Cash Bonus Units Agreement (the "Cash Bonus Units Agreement"), dated December 4, 2008, with SAMC pursuant to which Mr. Beasley is entitled to receive payment in cash of an amount equal to the appreciation in value, if any, of 100,000 Shares above a price of $13.50 per Share from the earlier of (i) May 7, 2009, (ii) the 2009 Annual Meeting, or (iii) Mr. Beasley's appointment to the board of directors, until December 31, 2009, subject to a minimum and maximum payment. The Cash Bonus Units Agreement also provides for a separate payment to Mr. Beasley of $250,000 in the event that the price of the Shares exceeds $30/Share prior to December 31, 2009. This description of the Consulting Services Agreement and the Cash Bonus Units Agreement is summary only and is qualified by reference to the Consulting Services Agreement and the Cash Bonus Units Agreement, copies of which are filed as Exhibits N and O to this Schedule 13D and are incorporated herein by reference. ITEM 7. MATERIAL TO BE FILED AS EXHIBITS Item 7 of the Schedule 13D is hereby amended and supplemented as follows: EXHIBIT J: Nominee Agreement with K. Gollust EXHIBIT K: Nominee Agreement with M. Egan EXHIBIT L: Nominee Agreement with S. Beasley EXHIBIT M: Nominee Agreement with N. Graziano EXHIBIT N: Consulting Services Agreement EXHIBIT O: Cash Bonus Units Agreement ---------------------------- ---------------------------- CUSIP No. 844030106 SCHEDULE 13D/A Page 10 of 10 Pages ---------------------------- ---------------------------- Signature After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: December 9, 2008 CASTLERIGG MASTER INVESTMENTS LTD. By: Sandell Asset Management Corp., its Investment Manager By: /s/ Thomas E. Sandell --------------------- Thomas E. Sandell, Chief Executive Officer SANDELL ASSET MANAGEMENT CORP. By: /s/ Thomas E. Sandell --------------------- Thomas E. Sandell, Chief Executive Officer CASTLERIGG INTERNATIONAL LIMITED By: Sandell Asset Management Corp., its Investment Manager By: /s/ Thomas E. Sandell --------------------- Thomas E. Sandell, Chief Executive Officer CASTLERIGG INTERNATIONAL HOLDINGS LIMITED By: Sandell Asset Management Corp., its Investment Manager By: /s/ Thomas E. Sandell --------------------- Thomas E. Sandell, Chief Executive Officer /s/ Thomas E. Sandell --------------------- Thomas E. Sandell /s/ Nick Graziano --------------------- Nick Graziano