SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) September 8, 1998
ALABAMA POWER COMPANY
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(Exact name of registrant as specified in its charter)
Alabama 1-3164 63-0004250
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(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) dentification No.)
600 North 18th Street, Birmingham, Alabama 35291
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (205) 257-1000
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N/A
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(Former name or former address, if changed since last report.)
<PAGE>
Item 5. Other Events.
On September 8, 1998, Alabama Power Company (the "Company")
entered into an Underwriting Agreement covering the issue and sale by the
Company of $100,000,000 aggregate principal amount of its Series E 6.25% Senior
Notes due September 30, 2010 (the "Series E Senior Notes"). Said Notes were
registered under the Securities Act of 1933, as amended (the "Securities Act"),
pursuant to the shelf registration statement (Registration Statement Nos.
333-53299, 333-53299-01, 333-53299-02 and 333-53299-03) of the Company.
Incorporation of Certain Documents by Reference
Pursuant to Rule 411of Regulation C under the Securities Act and
in reliance on MBIA Insurance Corporation, SEC No-Action Letter (September 6,
1996), the Company does hereby incorporate by reference the consolidated
financial statements of MBIA Insurance Corporation and Subsidiaries as of
December 31, 1997 and December 31, 1996, and for each of the three years in the
period ended December 31, 1997, included in the Annual Report on Form 10-K of
MBIA Inc. (which was filed with the Securities and Exchange Commission on March
30, 1998) into (i) this Current Report on Form 8-K; (ii) the Company's
Registration Statement on Form S-3 (File Nos. 333-53299, 333-53299-01,
333-53299-02 and 333-53299-03); and (iii) the final prospectus supplement dated
September 8, 1998 relating to the Series E Senior Notes filed pursuant to Rule
424(b) under the Securities Act.
In connection with the incorporation of such documents by
reference, the Company is hereby filing the consent of PricewaterhouseCoopers
LLP, independent accountants for MBIA Insurance Corporation, insurer of the
Series E Senior Notes, to the use of its name in such prospectus supplement. The
consent of PricewaterhouseCoopers LLP is filed herewith as Exhibit 23.
<PAGE>
2
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
1 Underwriting Agreement, dated September 8, 1998,
among the Company and Goldman, Sachs & Co. and
Prudential Securities Incorporated as the
Underwriters.
4.2 Fifth Supplemental Indenture to Senior Note
Indenture dated as of September 17, 1998,
providing for the issuance of the Series E Senior
Notes.
4.7 Form of Series E Senior Note (included in Exhibit
4.2 above).
23 Consent of PricewaterhouseCoopers LLP.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
Date: September 14, 1998 ALABAMA POWER COMPANY
By /s/ Wayne Boston
Wayne Boston
Assistant Secretary
Exhibit 1
$100,000,000 Series E 6.25% Senior Notes
due September 30, 2010
ALABAMA POWER COMPANY
UNDERWRITING AGREEMENT
September 8, 1998
Goldman, Sachs & Co.
Prudential Securities Incorporated
c/o Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Ladies and Gentlemen:
Alabama Power Company, an Alabama corporation (the "Company"),
confirms its agreement (the "Agreement") with Goldman, Sachs & Co., acting as
the representative (the "Representative") of the underwriters named in Schedule
I hereto (the "Underwriters", which term shall include any underwriter
substituted as hereinafter provided in Section 10 hereof), with respect to the
sale by the Company and the purchase by the Underwriters, acting severally and
not jointly, of $100,000,000 principal amount of the Series E 6.25% Senior Notes
due September 30, 2010 (the "Senior Notes") as set forth in Schedule I hereto.
The Company understands that the Underwriters propose to make
a public offering of the Senior Notes as soon as the Underwriters deem advisable
after this Agreement has been executed and delivered. The Senior Notes will be
issued pursuant to an indenture, dated as of December 1, 1997, as heretofore
supplemented (the "Base Indenture"), between the Company and The Chase Manhattan
Bank, as trustee (the "Trustee"), as supplemented by a fifth supplemental
indenture to the Base Indenture relating to the Senior Notes (the "Supplemental
Indenture," and together with the Base Indenture and any other amendments or
supplements thereto, the "Indenture"), between the Company and the Trustee.
SECTION 1. REPRESENTATIONS AND WARRANTIES. The Company represents
and warrants to the Underwriters as follows:
(a) A registration statement on Form S-3, as amended (File Nos. 333-53299,
333-53299-01, 333-53299-02 and 333-53299-03), in respect of the Senior
Notes and certain other securities has been prepared and filed in
accordance with the provisions of the Securities Act of 1933, as amended
(the "1933 Act"), with the Securities and Exchange Commission (the
"Commission"); such registration statement, as amended, and any
post-effective amendment thereto, each in the form heretofore delivered or
to be delivered to the Underwriters, has been declared effective by the
Commission in such form (except that copies of the registration statement,
as amended, and any post-effective amendment delivered to the Underwriters
need not include exhibits but shall include all documents incorporated by
reference therein); and no stop order suspending the effectiveness of such
registration statement has been issued and no proceeding for that purpose
has been initiated or, to the best knowledge of the Company, threatened by
the Commission (any preliminary prospectus, as supplemented by a
preliminary prospectus supplement, included in such registration statement
or filed with the Commission pursuant to Rule 424(a) of the rules and
regulations of the Commission under the 1933 Act, being hereinafter called
a "Preliminary Prospectus"); such registration statement, as it became
effective, including the exhibits thereto and all documents incorporated by
reference therein pursuant to Item 12 of Form S-3 at the time such
registration statement became effective, being hereinafter called the
"Registration Statement"; the prospectus relating to the Senior Notes, in
the form in which it was included in the Registration Statement at the time
it became effective, being hereinafter called the "Prospectus"; any
reference herein to any Preliminary Prospectus or the Prospectus shall be
deemed to refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the 1933 Act, as of the date
of such Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment or supplement to any Preliminary Prospectus or
the Prospectus shall be deemed to refer to and include any documents filed
after the date of such Preliminary Prospectus or Prospectus, as the case
may be, under the Securities Exchange Act of 1934, as amended (the "1934
Act"), and incorporated by reference in such Preliminary Prospectus or
Prospectus, as the case may be; any reference to any amendment to the
Registration Statement shall be deemed to refer to and include any annual
report of the Company filed pursuant to Section 13(a) or 15(d) of the 1934
Act after the effective date of the Registration Statement that is
incorporated by reference in the Registration Statement; and the Prospectus
as amended or supplemented in final form by a prospectus supplement
relating to the Senior Notes in the form in which it is filed with the
Commission, pursuant to Rule 424(b) under the 1933 Act in accordance with
Section 3(g) hereof, including any documents incorporated by reference
therein as of the date of such filing, being hereinafter called the "Final
Supplemented Prospectus".
(b) The documents incorporated by reference in the Registration Statement or
Prospectus, when they were filed with the Commission, complied in all material
respects with the applicable provisions of the 1934 Act and the rules and
regulations of the Commission thereunder, and as of such time of filing, when
read together with the Prospectus, none of such documents contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and any further
documents so filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto, when such documents are filed with the
Commission, will comply in all material respects with the applicable provisions
of the 1934 Act and the rules and regulations of the Commission thereunder and,
when read together with the Prospectus as it otherwise may be amended or
supplemented, 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, in the light of the circumstances under which they were
made, not misleading, except that the Company makes no warranty or
representation to the Underwriters with respect to: (A) any statements or
omissions made in reliance upon and in conformity with information furnished in
writing to the Company by the Underwriters expressly for use in the Preliminary
Supplemented Prospectus or the Final Supplemented Prospectus; or (B) any
information set forth in the Preliminary Supplemented Prospectus or the Final
Supplemented Prospectus under the captions "Description of the Series E Senior
Notes - Book-Entry Only Issuance -- The Depository Trust Company" and "The
Insurer." (c) The Registration Statement and the Prospectus and the Final
Supplemented Prospectus and any further amendments or supplements to the
Registration Statement or the Prospectus, when any such post-effective
amendments are declared effective or supplements are filed with the Commission,
as the case may be, will comply, in all material respects with the applicable
provisions of the 1933 Act, the 1934 Act, the 1939 Act (hereinafter defined) and
the General Rules and Regulations of the Commission thereunder and do not and
will not, (i) as of the applicable effective date as to the Registration
Statement and any amendment thereto and (ii) as of the applicable filing date as
to the Final Supplemented Prospectus and any Prospectus as further amended or
supplemented, contain an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; except that the
Company makes no warranties or representations with respect to (A) that part of
the Registration Statement which shall constitute the Statements of Eligibility
(Form T-1) (collectively, the "Form T-1") under the Trust Indenture Act of 1939,
as amended (the "1939 Act"), (B) statements or omissions made in the
Registration Statement or the Final Supplemented Prospectus in reliance upon and
in conformity with information furnished in writing to the Company by the
Underwriters expressly for use therein or (C) any information set forth in the
Final Supplemented Prospectus under the captions "Description of the Series E
Senior Notes - Book-Entry Only Issuance -- The Depository Trust Company" and
"The Insurer." (d) With respect to the Registration Statement, the conditions
for use of Form S-3, as set forth in the General Instructions thereof, have been
satisfied. (e) Since the respective dates as of which information is given in
the Registration Statement and the Final Supplemented Prospectus, except as
otherwise stated therein, there has been no material adverse change in the
business, properties or financial condition of the Company. (f) The Company is a
corporation duly organized and existing under the laws of the State of Alabama
and has due corporate authority to carry on the public utility business in which
it is engaged and to own and operate the properties used by it in such business,
to enter into and perform its obligations under this Agreement and the Indenture
and to issue and sell the Senior Notes to the Underwriters. (g) This Agreement
has been duly authorized, executed and delivered by the Company. (h) The
Indenture has been duly authorized by the Company and, on the Closing Date, will
have been duly executed and delivered by the Company, and, assuming due
authorization, execution and delivery of the Indenture by the Trustee, the
Indenture will, on the Closing Date, constitute a valid and binding obligation
of the Company, enforceable against the Company in accordance with its terms
except to the extent that enforcement thereof may be limited by (1) bankruptcy,
insolvency, reorganization, receivership, liquidation, fraudulent conveyance,
moratorium or other similar laws affecting creditors' rights generally or (2)
general principles of equity (regardless of whether enforcement is considered in
a proceeding at law or in equity) (the "Enforceability Exceptions"); the
Indenture will conform in all material respects to all statements relating
thereto contained in the Final Supplemented Prospectus; and, on the Closing
Date, the Indenture will have been duly qualified under the 1939 Act. (i) The
issuance and delivery of the Senior Notes have been duly authorized by the
Company and, on the Closing Date, the Senior Notes will have been duly executed
by the Company and, when authenticated in the manner provided for in the
Indenture and delivered against payment therefor as described in the Final
Supplemented Prospectus, will constitute valid and legally binding obligations
of the Company, enforceable against the Company in accordance with their terms,
except to the extent that enforcement thereof may be limited by the
Enforceability Exceptions, will be in the form contemplated by, and entitled to
the benefits of, the Indenture and will conform in all material respects to all
statements relating thereto in the Final Supplemented Prospectus. (j) The
execution, delivery and performance by the Company of this Agreement, the
Indenture and the Senior Notes and the consummation by the Company of the
transactions contemplated herein and therein and compliance by the Company with
its obligations hereunder and thereunder shall have been duly authorized by all
necessary corporate action on the part of the Company and do not and will not
result in any violation of the charter or bylaws of the Company, and do not and
will not conflict with, or result in a breach of any of the terms or provisions
of, or constitute a default under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the Company under
(A) any contract, indenture, mortgage, loan agreement, note, lease or other
agreement or instrument to which the Company is a party or by which it may be
bound or to which any of its properties may be subject (except for conflicts,
breaches or defaults which would not, individually or in the aggregate, be
materially adverse to the Company or materially adverse to the transactions
contemplated by this Agreement), or (B) any existing applicable law, rule,
regulation, judgment, order or decree of any government, governmental
instrumentality or court, domestic or foreign, or any regulatory body or
administrative agency or other governmental body having jurisdiction over the
Company, or any of its properties. (k) The Company has duly authorized all
necessary action to be taken by it for the procurement of an irrevocable
financial guarantee insurance policy (the "Insurance Policy") issued by MBIA
Insurance Corporation (the "Insurer"), insuring the payment of principal and
interest on the Senior Notes, when due. (l) No authorization, approval, consent
or order of any court or governmental authority or agency is necessary in
connection with the issuance and sale by the Company of the Senior Notes or the
transactions by the Company contemplated in this Agreement, except (A) such as
may be required under the 1933 Act or the rules and regulations thereunder; (B)
such as may be required under the Public Utility Holding Company Act of 1935, as
amended (the "1935 Act"); (C) the qualification of the Indenture under the 1939
Act; (D) the approval of the Alabama Public Service Commission (the "Alabama
Commission"); and (E) such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws.
SECTION 2. SALE AND DELIVERY TO THE UNDERWRITERS; CLOSING.
(a) On the basis of the representations and warranties herein contained and
subject to the terms and conditions herein set forth, the Company agrees to sell
to each Underwriter, and each Underwriter, severally and not jointly, agrees to
purchase from the Company, the principal amount of Senior Notes set forth in
Schedule I to this Agreement opposite the name of such Underwriter (plus any
additional amount of Senior Notes that such Underwriter may become obligated to
purchase pursuant to the provisions of Section 10 hereof), at a price equal to
98.00% of the principal amount thereof.
(b) Payment for and delivery of certificates for the Senior Notes shall be made
at the offices of Troutman Sanders LLP, 600 Peachtree Street, N.E., Atlanta,
Georgia 30308 at 10:00 A.M., Atlanta time, on September 17, 1998 (unless
postponed in accordance with the provisions of Section 10) or such other time,
place or date as shall be agreed upon by the Underwriters and the Company (such
time and date of payment and delivery being herein called the "Closing Date").
Payment shall be made to the Company by wire transfer in federal funds at the
Closing Date against delivery of the Senior Notes to the Underwriters.
The delivery of the Senior Notes shall be made in fully
registered form, registered in the name of CEDE & CO., to the offices of The
Depository Trust Company in New York, New York or its designee, and the
Underwriters shall accept such delivery.
The certificate(s) for the Senior Notes will be made available
for examination by the Underwriters not later than 12:00 Noon, New York time, on
the last business day prior to the Closing Date.
SECTION 3. COVENANTS OF THE COMPANY. The Company covenants with the
Underwriters as follows:
(a) The Company, on or prior to the Closing Date, will deliver to the
Underwriters conformed copies of the Registration Statement as originally filed
and of all amendments thereto, heretofore or hereafter made, including any
post-effective amendment (in each case including all exhibits filed therewith,
and including unsigned copies of each consent and certificate included therein
or filed as an exhibit thereto, except exhibits incorporated by reference,
unless specifically requested). As soon as the Company is advised thereof, it
will advise the Underwriters orally of the issuance of any stop order under the
1933 Act with respect to the Registration Statement, or the institution of any
proceedings therefor, of which the Company shall have received notice, and will
use its best efforts to prevent the issuance of any such stop order and to
secure the prompt removal thereof, if issued. The Company will deliver to the
Underwriters sufficient conformed copies of the Registration Statement, the
Prospectus and the Final Supplemented Prospectus and of all supplements and
amendments thereto (in each case without exhibits) for distribution to the
Underwriters and, from time to time, as many copies of the Prospectus and the
Final Supplemented Prospectus as the Underwriters may reasonably request for the
purposes contemplated by the 1933 Act or the 1934 Act.
(b) The Company will furnish the Underwriters with copies of each amendment and
supplement to the Final Supplemented Prospectus relating to the offering of the
Senior Notes in such quantities as the Underwriters may from time to time
reasonably request. If, during the period (not exceeding nine months) when the
delivery of a prospectus shall be required by law in connection with the sale of
any Senior Notes by an Underwriter, any event relating to or affecting the
Company, or of which the Company shall be advised in writing by the
Underwriters, shall occur, which in the opinion of the Company or of
Underwriters' counsel should be set forth in a supplement to or an amendment of
the Final Supplemented Prospectus, as the case may be, in order to make the
Final Supplemented Prospectus not misleading in the light of the circumstances
when it is delivered, or if for any other reason it shall be necessary during
such period to amend or supplement the Final Supplemented Prospectus or to file
under the 1934 Act any document incorporated by reference in the Preliminary
Prospectus or Prospectus in order to comply with the 1933 Act or the 1934 Act,
the Company forthwith will (i) notify the Underwriters to suspend solicitation
of purchases of the Senior Notes and (ii) at its expense, make any such filing
or prepare and furnish to the Underwriters a reasonable number of copies of a
supplement or supplements or an amendment or amendments to the Final
Supplemented Prospectus which will supplement or amend the Final Supplemented
Prospectus so that, as supplemented or amended, it will not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances when the
Final Supplemented Prospectus is delivered, not misleading or which will effect
any other necessary compliance. In case any Underwriter is required to deliver a
prospectus in connection with the sale of any Senior Notes after the expiration
of the period specified in the preceding sentence, the Company, upon the request
of such Underwriter, will furnish to such Underwriter, at the expense of such
Underwriter, a reasonable quantity of a supplemented or amended prospectus, or
supplements or amendments to the Final Supplemented Prospectus, complying with
Section 10(a) of the 1933 Act. During the period specified in the second
sentence of this subsection, the Company will continue to prepare and file with
the Commission on a timely basis all documents or amendments required under the
1934 Act and the rules and regulations thereunder; provided, that the Company
shall not file such documents or amendments without also furnishing copies
thereof prior to such filing to the Underwriters and Dewey Ballantine LLP. (c)
The Company will endeavor, in cooperation with the Underwriters, to qualify the
Senior Notes for offering and sale under the applicable securities laws of such
states and the other jurisdictions of the United States as the Underwriters may
designate; provided, however, that the Company shall not be obligated to qualify
as a foreign corporation in any jurisdiction in which it is not so qualified or
to file a consent to service of process or to file annual reports or to comply
with any other requirements in connection with such qualification deemed by the
Company to be unduly burdensome. (d) The Company will make generally available
to its security holders as soon as practicable but not later than 45 days after
the close of the period covered thereby, an earnings statement of the Company
(in form complying with the provisions of Rule 158 of the rules and regulations
under the 1933 Act) covering a twelve-month period beginning not later than the
first day of the Company's fiscal quarter next following the "effective date"
(as defined in Rule 158) of the Registration Statement. (e) During a period of
15 days from the date of this Agreement, the Company will not, without the
Underwriters' prior written consent, directly or indirectly, sell, offer to
sell, grant any option for the sale of, or otherwise dispose of, any Senior
Notes or any security convertible into or exchangeable into or exercisable for
the Senior Notes or any debt securities substantially similar to the Senior
Notes (except for the Senior Notes issued pursuant to this Agreement). (f) As
soon as practicable after the date of this Agreement, and in any event within
the time prescribed by Rule 424 under the 1933 Act, to file the Final
Supplemented Prospectus with the Commission and to advise the Underwriters of
such filing and to confirm such advice in writing. SECTION 4. PAYMENT OF
EXPENSES. The Company will pay all expenses incidental to the performance of its
obligations under this Agreement, including but not limited to, the expenses of
(i) the printing and filing of the Registration Statement as originally filed
and of each amendment thereto, (ii) the preparation, issuance and delivery of
the certificate(s) for the Senior Notes, (iii) the fees and disbursements of the
Company's counsel and accountants, (iv) the qualification of the Senior Notes
under securities laws in accordance with the provisions of Section 3(c) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of any blue sky survey (such fees and disbursements of counsel shall not exceed
$3,500), (v) the printing and delivery to the Underwriters of copies of the
Registration Statement as originally filed and of each amendment thereto and of
the Prospectus, the Final Supplemented Prospectus, and any amendments or
supplements thereto, (vi) the printing and delivery to the Underwriters of
copies of any blue sky survey, (vii) the fee of the National Association of
Securities Dealers, Inc. in connection with its review of the offering
contemplated by this Agreement, if applicable, (viii) the fees and expenses of
the Trustee, including the fees and disbursements of counsel for the Trustee in
connection with the Indenture and the Senior Notes, (ix) any fees payable in
connection with the rating of the Senior Notes, (x) the cost and charges of any
transfer agent or registrar, (xi) the premium payable to the Insurer in
connection with the issuance of the Insurance Policy, and (xii) the cost of
qualifying the Senior Notes with The Depository Trust Company.
Except as otherwise provided in Section 9 hereof, the
Underwriters shall pay all other expenses incurred by them in connection with
their offering of the Senior Notes including fees and disbursements of their
counsel, Dewey Ballantine LLP.
SECTION 5. CONDITIONS OF UNDERWRITER'S OBLIGATIONS. The obligations
of the Underwriters to purchase and pay for the Senior Notes are subject to
the following conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement shall be in effect on the Closing Date and no proceedings for
that purpose shall be pending before, or to the knowledge of the
Company threatened by, the Commission on such date. If filing of the
Final Supplemented Prospectus, or any supplement thereto, is required
pursuant to Rule 424, the Final Supplemented Prospectus, and any such
supplement, shall have been filed in the manner and within the time
period required by Rule 424.
(b) Any required orders of the Commission permitting the transactions
contemplated hereby substantially in accordance with the terms and conditions
hereof shall be in full force and effect and shall contain no provision
unacceptable to the Underwriters or the Company (but all provisions of such
order or orders heretofore entered, copies of which have heretofore been
delivered to the Underwriters, are deemed acceptable to the Underwriters and the
Company and all provisions of such order or orders hereafter entered shall be
deemed acceptable to the Underwriters and the Company unless within 24 hours
after receiving a copy of any such order any party to this Agreement shall give
notice to the other parties to the effect that such order contains an
unacceptable provision).
(c) On the Closing Date the Underwriters shall have received:
(1) The opinion, dated the Closing Date, of Balch & Bingham LLP, general
counsel for the Company, substantially in the form attached hereto as
Schedule II-A.
(2) The opinion, dated the Closing Date, of Troutman Sanders LLP, counsel for
the Company, substantially in the form attached hereto as Schedule II-B. (3) The
opinion, dated the Closing Date, of Cravath, Swaine & Moore, counsel to the
Trustee, substantially in the form attached hereto as Schedule III. (4) The
opinion, dated as of the Closing Date, of Dewey Ballantine LLP, counsel for the
Underwriters, substantially in the form attached hereto as Schedule IV. (5) The
opinion, dated the Closing Date, of Kutak Rock, counsel to the Insurer,
substantially in the form attached hereto as Schedule V. (6) At the Closing
Date, there shall not have been, since the date hereof or since the respective
dates as of which information is given in the Registration Statement and the
Final Supplemented Prospectus, any material adverse change in the business,
properties or financial condition of the Company, whether or not arising in the
ordinary course of business, and the Underwriters shall have received a
certificate of the President or any Vice President of the Company, and dated as
of the Closing Date, to the effect that (i) there has been no such material
adverse change, (ii) the representations and warranties in Section 1 hereof are
true and correct with the same force and effect as though expressly made at and
as of the Closing Date, (iii) the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied on or prior to
the Closing Date, and (iv) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose have
been initiated or, to the knowledge of the Company, threatened by the
Commission. (7) On the Closing Date, the Underwriters shall have received from
Arthur Andersen LLP a letter dated the Closing Date to the effect that: (A) they
are independent public accountants with respect to the Company within the
meaning of the 1933 Act and the rules and regulations under the 1933 Act; (B) in
their opinion, the financial statements audited by them and incorporated by
reference in the Prospectus comply as to form in all material respects with the
applicable accounting requirements of the 1934 Act and the rules and regulations
under the 1934 Act; and (C) on the basis of certain limited procedures performed
through a specified date not more than five business days prior to the date of
such letter, namely (i) reading the minute books of the Company; (ii) performing
the procedures specified by the American Institute of Certified Public
Accountants ("AICPA") for a review of interim financial information as described
in Statement on Auditing Standards No. 71, "Interim Financial Information", on
the unaudited financial statements, if any, of the Company incorporated in the
Prospectus and of the latest available unaudited financial statements of the
Company, if any, as of a date subsequent to the date of those incorporated in
the Prospectus; and (iii) making inquiries of certain officials of the Company
who have responsibility for financial and accounting matters regarding such
unaudited financial statements or any specified unaudited amounts derived
therefrom (it being understood that the foregoing procedures do not constitute
an audit performed in accordance with generally accepted auditing standards and
they would not necessarily reveal matters of significance with respect to the
comments made in such letter, and accordingly that Arthur Andersen LLP make no
representations as to the sufficiency of such procedures for the Underwriters'
purposes), nothing came to their attention that caused them to believe that: (1)
any material modifications should be made to the unaudited condensed financial
statements, if any incorporated in the Prospectus, for them to be in conformity
with generally accepted accounting principles; (2) such unaudited condensed
financial statements do not comply as to form in all material respects with the
applicable accounting requirements of the 1934 Act as it applies to Form 10-Q
and the related published rules and regulations thereunder; (3) the unaudited
amounts for Operating Revenues, Income Before Interest Charges and Net Income
After Dividends on Preferred Stock and the unaudited Ratios of Earnings to Fixed
Charges and Earnings to Fixed Charges Plus Preferred Dividends Requirements
(Pre-Income Tax Basis) set forth in the Prospectus do not agree with the amounts
set forth in or derived from the unaudited financial statements for the same
period or were not determined on a basis substantially consistent with that of
the corresponding audited amounts or ratios included or incorporated by
reference in Registration Statement; (4) as of a specified date not more than
five business days prior to the date of delivery of such letter, there has been
any change in the capital stock or long-term debt of the Company or any decrease
in net assets as compared with amounts shown in the latest audited balance sheet
incorporated in the Prospectus, except in each case for changes or decreases
which (i) the Prospectus discloses have occurred or may occur, (ii) are
occasioned by the declaration of dividends, (iii) are occasioned by draw-downs
under existing pollution control financing arrangements, (iv) are occasioned by
draw-downs and regularly scheduled payments of capitalized lease obligations,
(v) are occasioned by the purchase or redemption of bonds or stock to satisfy
mandatory or optional redemption provisions relating thereto, or (vi) are
disclosed in such letter; and (5) the unaudited amounts for Operating Revenues,
Income Before Interest Charges and Net Income After Dividends Preferred Stock
and the unaudited Ratios of Earnings to Fixed Charges Plus Preferred Dividend
Requirements (Pre-Income Tax Basis) for any period subsequent to those set forth
in (3) above, which if available shall be set forth in such letter, do not agree
with the amounts set forth in or derived from the unaudited financial statements
for the same period or were not determined on a basis substantially consistent
with that of the corresponding audited amounts or ratios included or
incorporated by reference in the Prospectus. (8) On the Closing Date, counsel
for the Underwriters shall have been furnished with such documents and opinions
as it may reasonably require for the purpose of enabling it to pass upon the
issuance and sale of the Senior Notes as herein contemplated and related
proceedings, or in order to evidence the accuracy of any of the representations
or warranties, or the fulfillment of any of the conditions, herein contained;
and all proceedings taken by the Company in connection with the issuance and
sale of the Senior Notes as herein contemplated shall be satisfactory in form
and substance to the Underwriters and Dewey Ballantine LLP, counsel for the
Underwriters. (9) That no amendment or supplement to the Registration Statement
or the Final Supplemented Prospectus filed subsequent to the date of this
Agreement (including any filing made by the Company pursuant to Section 13 or 14
of the 1934 Act) shall be unsatisfactory in form to Dewey Ballantine LLP or
shall contain information (other than with respect to an amendment or supplement
relating solely to the activity of the Underwriters) which, in the reasonable
judgment of the Underwriters, shall materially impair the marketability of the
Senior Notes. (10) The Company shall have performed its obligations when and as
provided under this Agreement. (11) Evidence that the Insurance Policy has been
issued by the Insurer and confirmation that the Senior Notes have been rated at
least Aaa by Moody's Investors Services, Inc. and at least AAA by Standard &
Poor's Corporation.
If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Underwriters by notice to the Company at any time prior to the Closing
Date, and such termination shall be without liability of any party to any other
party except as provided in Sections 4, 7 and 9(b) hereof.
SECTION 6. CONDITIONS OF THE OBLIGATIONS OF THE COMPANY.
The obligations of the Company shall be subject to the
conditions set forth in the first sentence of Section 5(a) and in Section 5(b).
In case such conditions shall not have been fulfilled, this Agreement may be
terminated by the Company by mailing or delivering written notice thereof to the
Underwriters. Any such termination shall be without liability of any party to
any other party except as otherwise provided in Sections 4, 7 and 9(b) hereof.
SECTION 7. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless each of the Underwriters
and each person, if any, who controls any such Underwriter within the meaning of
Section 15 of the 1933 Act or Section 20(a) of the 1934 Act, against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the 1933 Act, 1934 Act or otherwise, and to
reimburse any such Underwriter and such controlling person or persons, if any,
for any legal or other expenses incurred by them in connection with defending
any actions, insofar as such losses, claims, damages, liabilities or actions
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in any Preliminary Prospectus, the Registration
Statement, the Prospectus or the Final Supplemented Prospectus or, if the
Company shall furnish to the Underwriters any amendments or any supplements
thereto, or shall make any filings pursuant to Section 13 or 14 of the 1934 Act
which are incorporated therein by reference, in any Preliminary Prospectus, the
Registration Statement, the Prospectus or the Final Supplemented Prospectus as
so amended or supplemented, or arise out of or are based upon any 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
such losses, claims, damages, liabilities or actions arise out of or are based
upon any such untrue statement or alleged untrue statement or omission or
alleged omission which was made in such Registration Statement, Preliminary
Prospectus, Prospectus or Final Supplemented Prospectus in reliance upon and in
conformity with information furnished in writing to the Company by the
Underwriters for use therein and except that this indemnity with respect to the
Preliminary Prospectus, the Prospectus or the Final Supplemented Prospectus, if
the Company shall have furnished any amendment or supplement thereto, shall not
inure to the benefit of any Underwriter (or of any person controlling such
Underwriter) on account of any losses, claims, damages, liabilities or actions
arising from the sale of the Senior Notes to any person if a copy of the
Preliminary Prospectus, the Prospectus or the Final Supplemented Prospectus
(exclusive of documents incorporated therein by reference pursuant to Item 12 of
Form S-3), as the same may then be amended or supplemented, shall not have been
sent or given by or on behalf of such Underwriter to such person with or prior
to the written confirmation of the sale involved and the untrue statement or
alleged untrue statement or omission or alleged omission was corrected in the
Preliminary Prospectus, the Prospectus or the Final Supplemented Prospectus as
supplemented or amended at the time of such confirmation. Each Underwriter
agrees, within ten days after the receipt by it of notice of the commencement of
any action in respect of which indemnity may be sought by it, or by any person
controlling it, from the Company on account of its agreement contained in this
Section 7, to notify the Company in writing of the commencement thereof but the
omission of such Underwriter so to notify the Company of any such action shall
not release the Company from any liability which it may have to such Underwriter
or to such controlling person otherwise than on account of the indemnity
agreement contained in this Section 7. In case any such action shall be brought
against an Underwriter or any such person controlling such Underwriter and such
Underwriter shall notify the Company of the commencement thereof as above
provided, the Company shall be entitled to participate in (and, to the extent
that it shall wish, including the selection of counsel, to direct) the defense
thereof, at its own expense. In case the Company elects to direct such defense
and select such counsel, any Underwriter or controlling person shall have the
right to employ its own counsel, but, in any such case, the fees and expenses of
such counsel shall be at the expense of such Underwriter or such controlling
person unless the employment of such counsel has been authorized in writing by
the Company in connection with defending such action. No indemnifying party
shall, without the written consent of the indemnified party, effect the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification may be sought hereunder (whether or not the indemnified party is
an actual or potential party to such action or claim) unless such settlement,
compromise or judgment (i) includes an unconditional release of the indemnified
party from all liability arising out of such action or claim and (ii) does not
include any statement as to, or an admission of, fault, culpability or a failure
to act, by or on behalf of any indemnified party. In no event shall any
indemnifying party have any liability or responsibility in respect of the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim effected without its prior
written consent.
(b) Each Underwriter agrees severally and not jointly, to indemnify and hold
harmless the Company, its directors and such of its officers who have signed the
Registration Statement and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20(a) of the 1934 Act to
the same extent and upon the same terms as the indemnity agreement of the
Company set forth in Section 7(a) hereof, but only with respect to alleged
untrue statements or omissions made in the Registration Statement, the
Preliminary Prospectus, the Prospectus or the Final Supplemented Prospectus, or
such documents as amended or supplemented, in reliance upon and in conformity
with information furnished in writing to the Company by such Underwriter for use
therein. SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY.
All representations, warranties and agreements contained in
this Agreement, or contained in certificates of officers of the Company
submitted pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or
controlling person, or by, or on behalf of the Company and shall survive
delivery of the Senior Notes to the Underwriters.
SECTION 9. TERMINATION OF AGREEMENT.
(a) The Representative may terminate this Agreement, by notice to the Company,
at any time at or prior to the Closing Date if (i) trading in securities on the
New York Stock Exchange shall have been generally suspended, (ii) minimum or
maximum ranges for prices shall have been generally established on the New York
Stock Exchange by the Commission or by the New York Stock Exchange, (iii) a
general banking moratorium shall have been declared by federal or New York State
authorities, or (iv) there shall have occurred any outbreak or escalation of
major hostilities in which the United States is involved, any declaration of war
by the United States Congress or any other substantial national or international
calamity or emergency affecting the United States, in any such case provided for
in clauses (i) through (iv) with the result that, in the reasonable judgement of
the Underwriters, the marketability of the Senior Notes shall have been
materially impaired.
If this Agreement shall be terminated by the Underwriters
pursuant to subsection (a) above or 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, or if for any reason the Company shall be unable to perform
its obligations under this Agreement, then in any such case, the Company will
reimburse the Underwriters for the reasonable fees and disbursements of Dewey
Ballantine LLP and for the out of pocket expenses (in an amount not exceeding
$10,000) reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of the Senior Notes and, upon such reimbursement,
the Company shall be absolved from any further liability hereunder, except as
provided in Sections 4 and 7.
SECTION 10. DEFAULT BY AN UNDERWRITER
If an Underwriter shall fail on the Closing Date to purchase
the Senior Notes that it is obligated to purchase under this Agreement (the
"Defaulted Securities"), the non-defaulting Underwriter shall have the right,
within 24 hours thereafter, to make arrangements for the non-defaulting
Underwriter, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth. If, however, the non-defaulting Underwriter shall not
have completed such arrangements within such 24-hour period, then:
(a) if the principal amount of Defaulted Securities does not
exceed 10% of the Senior Notes, the non-defaulting Underwriter shall be
obligated, severally and not jointly, to purchase the full amount thereof, or
(b) if the principal amount of Defaulted Securities exceeds
10% of the Senior Notes, this Agreement shall terminate without liability on the
part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement, either the non-defaulting Underwriter or the
Company shall have the right to postpone the Closing Date for a period not
exceeding seven days in order to effect any required changes in the Registration
Statement or Final Supplemented Prospectus or in any other documents or
arrangements.
SECTION 11. NOTICES. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed or transmitted by
any standard form of telecommunication. Notices to the Underwriters shall be
directed to the Representative at Goldman Sachs & Co., 85 Broad Street, New
York, New York 10004, Attention: Don Hansen, Registration; notices to the
Company shall be mailed to 600 North 18th Street, 17th floor, Birmingham,
Alabama, 35291, Attention: Corporate Secretary, with a copy to Southern Company
Services, Inc., 270 Peachtree Street, N.W., Atlanta, Georgia 30303, Attention:
Charles N. Eldred.
SECTION 12. PARTIES. This Agreement shall inure to the benefit of and be binding
upon the Underwriters, the Company and their respective successors. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the Underwriters and the
Company and their respective successors and the controlling persons and officers
and directors referred to in Section 7 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the Underwriters and the Company and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Senior Notes from the Underwriters shall be deemed
to be a successor by reason merely of such purchase. SECTION 13. GOVERNING LAW
AND TIME. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York applicable to agreements made and to be
performed in said State. Except as otherwise set forth herein, specified times
of day refer to New York City time. SECTION 14. COUNTERPARTS. 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.
<PAGE>
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement between the Underwriters and the Company in accordance with its terms.
Very truly yours,
ALABAMA POWER COMPANY
By: ______________________________
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written
GOLDMAN, SACHS & CO.,
as Representative of the Underwriters
By:___________________________
(Goldman, Sachs & Co.)
<PAGE>
SCHEDULE I
Principal Amount of
NAME OF UNDERWRITER Senior Notes
Goldman, Sachs & Co. $75,000,000
Prudential Securities Incorporated 25,000,000
TOTAL $100,000,000
- -------------------------------------------------------------
<PAGE>
Schedule II-A
[Letterhead of Balch & Bingham LLP]
___________ __, 199_
Goldman, Sachs & Co.
Prudential Securities Incorporated
c/o Goldman, Sachs & Co., as Representative
85 Broad Street
New York, New York 10004
ALABAMA POWER COMPANY
Series E __ % Senior Notes
Due September 30, 2010
Ladies and Gentlemen:
We have acted as general counsel to Alabama Power Company (the
"Company") in connection with (i) the Company's issuance of $______ aggregate
principal amount of its Series E __ % Senior Notes due September 30, 2010 (the
"Notes") pursuant to a Senior Note Indenture dated as of December 1, 1997, by
and between the Company and The Chase Manhattan Bank, as trustee (the
"Trustee"), as heretofore supplemented and as further supplemented by the Fifth
Supplemental Indenture dated as of __________ __, 199_ (collectively, the
"Indenture"); and (ii) the purchase by you of the Notes pursuant to the terms of
an Underwriting Agreement dated _______, 1998, among the Company and you (the
"Underwriters") (the "Underwriting Agreement"). This opinion is being delivered
to you pursuant to Section 5(c)(1) thereof.
All capitalized terms not otherwise defined herein shall have
the meanings set forth in the Underwriting Agreement.
In rendering the opinions expressed below, we have examined
the registration statement on Form S-3 (Nos. 333-53299, 333-53299-01,
333-53299-02 and 333-53299-03) pertaining to the Notes (the "Registration
Statement") filed under the Securities Act of 1933, as amended (the "Act"), and
the prospectus dated ________, 199_ as supplemented by a final prospectus
supplement dated __________, 199_ (the "Final Supplemented Prospectus"), which
pursuant to Form S-3 incorporates by reference the Annual Report on Form 10-K of
the Company for the fiscal year ended __________________, 199_, the Quarterly
Reports on Form 10-Q of the Company for the quarters ended ____________ and the
Current Reports on Form 8-K of the Company dated __________ (the "Exchange Act
Documents"), each as filed under the Securities Exchange Act of 1934, as amended
(the "Exchange Act").
In addition, we have examined, and have relied as to matters
of fact upon, the documents delivered to you at the closing (except the Notes,
of which we have examined a specimen), and we have made such other and further
investigations as we deemed necessary to express the opinions hereinafter set
forth.
The Indenture and the Underwriting Agreement are herein
referred to as the "Agreements".
Based upon the foregoing, and subject to the qualifications
and limitations stated herein, we are of the opinion, relying as to matters of
New York law upon the opinion dated the date hereof rendered to you by Dewey
Ballantine LLP, that:
1. The Company has been duly organized and is validly existing and in
good standing as a corporation under the laws of the State of Alabama and has
due corporate authority to carry on the public utility business in which it is
engaged and to own and operate the properties used by it in such business and to
enter into and perform its obligations under the Agreements and the Notes.
2. The execution, delivery and performance by the Company of the
Underwriting Agreement have been duly authorized by all necessary corporate
action, and the Underwriting Agreement has been duly executed and delivered by
the Company.
3. All orders, consents, or other authorizations or approvals of the
Alabama Public Service Commission and the Commission legally required for the
issuance and sale of the Notes have been obtained; such orders are sufficient
for the issuance and the sale of the Notes; the issuance and the sale of the
Notes conform in all material respects with the terms of such orders; and no
other order, consent or other authorization or approval of any Alabama or United
States governmental body (other than in connection or in compliance with the
provisions of the securities or "blue sky" laws of any jurisdiction, as to which
we express no opinion) is legally required for the issuance and sale of the
Notes in accordance with the terms of the Underwriting Agreement.
4. The Indenture has been duly authorized, executed and delivered by
the Company and, assuming the due authorization, execution and delivery thereof
by the Trustee, constitutes a valid and legally binding instrument of the
Company, enforceable against the Company in accordance with its terms, subject
to the qualifications that the enforceability of the Company's obligations under
the Indenture may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law); and the
Indenture conforms as to legal matters in all material respects to the
description thereof in the Final Supplemented Prospectus.
5. The Notes have been duly authorized and executed by the Company and,
when authenticated by the Trustee in the manner provided in the Indenture and
delivered to and paid for by the Underwriters pursuant to the Underwriting
Agreement, will constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, subject to the
qualifications that the enforceability of the Company's obligations under the
Notes may be limited by bankruptcy, insolvency, reorganization, moratorium and
other similar laws relating to or affecting creditors' rights generally and by
general principles of equity; and the Notes conform as to legal matters in all
material respects to the description thereof in the Final Supplemented
Prospectus.
6. The Indenture has been duly qualified under the Trust Indenture Act
of 1939, as amended (the "Trust Indenture Act").
We have not independently verified the accuracy, completeness
or fairness of the statements made or included in the Registration Statement,
the Final Supplemented Prospectus or the Exchange Act Documents and take no
responsibility therefor, except as and to the extent set forth in paragraphs 4
and 5 above and in the Final Supplemented Prospectus in the second paragraph
under the caption "Experts". In the course of the preparation by the Company of
the Registration Statement, the Final Supplemented Prospectus and the Exchange
Act Documents, we participated in conferences with certain officers and
employees of the Company, with other counsel for the Company and with
representatives of Arthur Andersen LLP. Based upon our examination of the
Registration Statement, the Final Supplemented Prospectus and the Exchange Act
Documents, our investigations made in connection with the preparation of the
Registration Statement, the Final Supplemented Prospectus and the Exchange Act
Documents and our participation in the conferences referred to above, (i) we are
of the opinion that the Registration Statement, as of its effective date, and
the Final Supplemented Prospectus, as of __________, complied as to form in all
material respects with the requirements of the Act and the applicable rules and
regulations of the Commission thereunder and that the Exchange Act Documents, as
of their respective dates of filing with the Commission, complied as to form in
all material respects with the relevant requirements of the Exchange Act and the
applicable rules and regulations of the Commission thereunder, except that in
each case we express no opinion as to the financial statements or other
financial or statistical data contained or incorporated by reference in the
Registration Statement, the Final Supplemented Prospectus or the Exchange Act
Documents, and (ii) nothing came to our attention which gives us reason to
believe that the Registration Statement, as of its effective date (including the
Exchange Act Documents on file with the Commission as of such date), contained
any untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary in order to make the statements
therein not misleading, or that the Final Supplemented Prospectus (including the
Exchange Act Documents) contains any untrue statement therein of a material fact
or omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, except that in each case we express no opinion or belief with
respect to the financial statements or other financial or statistical data
contained or incorporated by reference in the Registration Statement, the Final
Supplemented Prospectus or the Exchange Act Documents and with respect to
information set forth in the Final Supplemented Prospectus under the captions
"Description of the Series E Senior Notes - Book-Entry Only Issuance - The
Depository Trust Company" and "The Insurer."
We are members of the State Bar of Alabama and we do not
express any opinion herein concerning any law other than the laws of such State
and, to the extent set forth herein, the law of the States of New York and the
federal law of the United States.
This opinion is rendered to you in connection with the
above-described transaction. This opinion may not be relied upon by you for any
other purpose, or relied upon by or furnished to any other person without our
prior written consent, except that Troutman Sanders LLP and Dewey Ballantine LLP
may rely on this opinion in giving their opinions pursuant to the Underwriting
Agreement insofar as such opinion relates to matters of Alabama law.
Yours very truly,
BALCH & BINGHAM LLP
<PAGE>
Schedule II-B
[Letterhead of TROUTMAN SANDERS LLP]
__________ __, 199_
Goldman, Sachs & Co.
Prudential Securities Incorporated
c/o Goldman, Sachs & Co., as Representative
85 Broad Street
New York, New York 10004
ALABAMA POWER COMPANY
Series E __ % Senior Notes
Due September 30, 2010
Ladies and Gentlemen:
We have acted as counsel to Alabama Power Company (the
"Company") in connection with (i) the Company's issuance of $__________
aggregate principal amount of its Series E __% Senior Notes due September 30,
2010 (the "Notes") pursuant to a Senior Note Indenture dated as of December 1,
1997, by and between the Company and The Chase Manhattan Bank, as trustee (the
"Trustee"), as heretofore supplemented and as further supplemented by the Fifth
Supplemental Indenture dated as of __________ __, 199_ (collectively, the
"Indenture"); and (ii) the purchase by you (the "Underwriters") of the Notes
pursuant to the terms of an Underwriting Agreement dated ___________ __, 19__,
among the Company and you (the "Underwriting Agreement"). This opinion is being
delivered to you pursuant to Section 5(c)(2) thereof.
All capitalized terms not otherwise defined herein shall have
the meanings set forth in the Underwriting Agreement.
In rendering the opinions expressed below, we have examined
the registration statement on Form S-3 (Nos. 333-53299, 333-53299-01,
333-53299-02 and 333-53299-03) pertaining to the Notes (the "Registration
Statement") filed under the Securities Act of 1933, as amended (the "Act"), and
the prospectus dated ___________, 199_ as supplemented by a final prospectus
supplement dated __________, 199_ (the "Final Supplemented Prospectus"), which
pursuant to Form S-3 incorporates by reference the Annual Report on Form 10-K of
the Company for the fiscal year ended _____________, 199_, the Quarterly Reports
on Form 10-Q of the Company for the quarters ended ____________ and the Current
Reports on Form 8-K of the Company dated _________ (the "Exchange Act
Documents"), each as filed under the Securities Exchange Act of 1934, as amended
(the "Exchange Act").
In addition, we have examined, and have relied as to matters
of fact upon, the documents delivered to you at the closing (except the
certificates representing the Notes, of which we have examined a specimen), and
we have made such other and further investigations as we deemed necessary to
express the opinions hereinafter set forth. In such examination, we have assumed
the genuineness of all signatures, the legal capacity of natural persons, the
authenticity of all documents submitted to us as originals, the conformity to
original documents of all documents submitted to us as certified or photostatic
copies, and the authenticity of the originals of such latter documents.
The Indenture and the Underwriting Agreement are herein
referred to collectively as the "Agreements".
Based upon the foregoing, and subject to the qualifications
and limitations stated herein, we are of the opinion, relying as to matters of
Alabama law upon the opinion dated the date hereof rendered to you by Balch &
Bingham LLP, and relying as to matters of New York law upon the opinion dated
the date hereof rendered to you by Dewey Ballantine LLP, that:
1. The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Alabama and has due
corporate authority to carry on the public utility business in which it is
engaged, to own and operate the properties used by it in such business and to
enter into and perform its obligations under the Agreements and the Notes.
2. The execution, delivery and performance by the Company of the
Underwriting Agreement have been duly authorized by all necessary corporate
action, and the Underwriting Agreement has been duly executed and delivered by
the Company.
3. All orders, consents or other authorizations or approvals of the
Alabama Public Service Commission and the Commission legally required for the
issuance and sale of the Notes have been obtained; such orders are sufficient
for the issuance and sale of the Notes; the issuance and sale of the Notes
conform in all material respects with the terms of such orders; and no other
order, consent or other authorization or approval of any Alabama or United
States governmental body (other than in connection or in compliance with the
provisions of the securities or "blue sky" laws of any jurisdiction, as to which
we express no opinion) is legally required for the issuance and sale of the
Notes in accordance with the terms of the Underwriting Agreement.
4. The Indenture has been duly authorized, executed and delivered by
the Company and, assuming the due authorization, execution and delivery thereof
by the Trustee, constitutes a valid and legally binding instrument of the
Company, enforceable against the Company in accordance with its terms, subject
to the qualifications that the enforceability of the Company's obligations under
the Indenture may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law); and the
Indenture conforms as to legal matters in all material respects to the
description thereof in the Final Supplemented Prospectus.
5. The Notes have been duly authorized and executed by the Company and,
when authenticated by the Trustee in the manner provided in the Indenture and
delivered to and paid for by the Underwriters pursuant to the Underwriting
Agreement, will constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, subject to the
qualifications that the enforceability of the Company's obligations under the
Notes may be limited by bankruptcy, insolvency, reorganization, moratorium and
other similar laws relating to or affecting creditors' rights generally and by
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law); and the Notes conform as to
legal matters in all material respects to the description thereof in the Final
Supplemented Prospectus.
6. The Indenture has been duly qualified under the Trust Indenture Act
of 1939, as amended.
We have not independently verified the accuracy, completeness
or fairness of the statements made or included in the Registration Statement,
the Final Supplemented Prospectus or the Exchange Act Documents and take no
responsibility therefor, except as and to the extent set forth in paragraphs 4
and 5 above. In the course of the preparation by the Company of the Registration
Statement, the Final Supplemented Prospectus and the Exchange Act Documents, we
participated in conferences with certain officers and employees of the Company,
with other counsel for the Company, with representatives of Arthur Andersen LLP
and with your counsel. Based upon our examination of the Registration Statement,
the Final Supplemented Prospectus and the Exchange Act Documents, our
investigations made in connection with the preparation of the Registration
Statement, the Final Supplemented Prospectus and the Exchange Act Documents and
our participation in the conferences referred to above, (i) we are of the
opinion that the Registration Statement, as of its effective date, and the Final
Supplemented Prospectus, as of _______________, complied as to form in all
material respects with the requirements of the Act and the applicable rules and
regulations of the Commission thereunder and that the Exchange Act Documents, as
of their respective dates of filing with the Commission, complied as to form in
all material respects with the relevant requirements of the Exchange Act and the
applicable rules and regulations of the Commission thereunder, except that in
each case we express no opinion as to the financial statements or other
financial or statistical data contained or incorporated by reference in the
Registration Statement, the Final Supplemented Prospectus or the Exchange Act
Documents, and (ii) nothing came to our attention which gives us reason to
believe that the Registration Statement, as of its effective date (including the
Exchange Act Documents on file with the Commission as of such date), contained
any untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary in order to make the statements
therein not misleading, or that the Final Supplemented Prospectus (including the
Exchange Act Documents) contains any untrue statement of a material fact or
omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, except that in each case we express no opinion or belief with
respect to the financial statements or other financial or statistical data
contained or incorporated by reference in the Registration Statement, the Final
Supplemented Prospectus or the Exchange Act Documents and with respect to
information set forth in the Final Supplemented Prospectus under the captions
"Description of the Series E Senior Notes - Book-Entry Only Issuance - The
Depository Trust Company" and "The Insurer."
We are members of the State Bar of Georgia and we do not
express any opinion herein concerning any law other than the law of the State of
Georgia and the federal law of the United States and, to the extent set forth
herein, the laws of the States of Alabama and New York.
This opinion is rendered to you in connection with the
above-described transaction. This opinion may not be relied upon by you for any
other purpose, or relied upon by or furnished to any other person without our
prior written consent.
Yours very truly,
TROUTMAN SANDERS LLP
<PAGE>
Schedule III
[Letterhead of Cravath, Swaine & Moore]
__________ __, 199_
Goldman, Sachs & Co.
Prudential Securities Incorporated
c/o Goldman, Sachs & Co., as Representative
85 Broad Street
New York, New York 10004
Alabama Power Company
600 North 18th Street
Birmingham, Alabama 35291
MBIA Insurance Corporation
113 King Street
Armonk, New York 10504
Alabama Power Company
Series E __ % Senior Notes
Due September 30, 2010
Ladies and Gentlemen:
We have acted as counsel to The Chase Manhattan Bank (the
"Bank") in connection with (a) the Senior Note Indenture, dated as of December
1, 1997 as heretofore supplemented (the "Original Indenture"), between Alabama
Power Company (the "Company") and the Bank, as Trustee, and (b) the Fifth
Supplemental Indenture dated as of ___________ (together with the Original
Indenture, herein called the "Indenture"), between the Company and the Bank, as
Trustee.
In that connection, we have examined originals, or copies
certified or otherwise identified to our satisfaction, of such documents,
records and other instruments as we have deemed necessary or appropriate for the
purpose of this opinion, including copies of the Indenture and certain
resolutions adopted by the Board of Directors of the Bank.
Based upon the foregoing, we are of the opinion that:
i) the Bank has been duly incorporated and is
validly existing as a banking corporation in good standing under the laws of
the State of New York;
ii) the Bank has the corporate trust power and
authority to execute, deliver and perform its duties under the Indenture, has
duly executed and delivered the Indenture, and, insofar as the laws governing
the trust powers of the Bank are concerned and assuming due authorization,
execution and delivery thereof by the Company, the Indenture constitutes a
legal, valid and binding agreement of the Bank, enforceable against the Bank in
accordance with its terms subject to applicable bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium or other laws affecting
creditors' rights generally from time to time in effect and to general
principles of equity (including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing), regardless of whether considered
in a proceeding in equity or at law;
iii) the execution, delivery and performance by
the Bank of the Indenture does not conflict with or constitute a breach of the
charter or bylaws of the Bank; and
iv) no approval, authorization or other action
by, or filing with, any governmental authority of the United States of America
or the State of New York having jurisdiction over the trust powers of the Bank
is required in connection with the execution and delivery by the Bank of the
Indenture or the performance by the Bank of its duties thereunder, except such
as have been obtained, taken or made.
We are admitted to practice only in the State of New York, and
we express no opinion as to matters governed by any laws other than the laws of
the State of New York and the Federal law of the United States of America. We
are furnishing this opinion to you solely for your benefit. This opinion is not
to be relied upon by any other person or used, circulated, quoted or otherwise
referred to for any other purpose.
Very truly yours,
CRAVATH, SWAINE & MOORE
<PAGE>
Schedule IV
[Letterhead of DEWEY BALLANTINE LLP]
__________ __, 199_
Goldman, Sachs & Co.
Prudential Securities Incorporated
c/o Goldman, Sachs & Co., as Representative
85 Broad Street
New York, New York 10004
ALABAMA POWER COMPANY
Series E __ % Senior Notes
Due September 30, 2010
Ladies and Gentlemen:
We have represented you (the "Underwriters") in connection
with (i) the issuance by Alabama Power Company (the "Company") of $____________
of its Series E __ % Senior Notes (the "Notes") pursuant to a Senior Note
Indenture dated as of December 1, 1997, by and between the Company and The Chase
Manhattan Bank, as trustee (the "Trustee"), as heretofore supplemented and as
further supplemented by the Fifth Supplemental Indenture dated as of __________
__, 199_ (collectively, the "Indenture"); and (ii) the purchase by you of the
Notes pursuant to the terms of an Underwriting Agreement dated ________________,
1998, among the Company and the Underwriters (the "Underwriting Agreement").
This opinion is being delivered to you pursuant to Section 5(c)(4) thereof.
All capitalized terms not otherwise defined herein shall have
the meanings set forth in the Underwriting Agreement.
In rendering the opinions expressed below, we have examined
the registration statement on Form S-3 (Nos. 333-53299, 333-53299-01,
333-53299-02 and 333-53299-03) pertaining to the Notes (the "Registration
Statement"), filed under the Securities Act of 1933, as amended (the "Act"), and
the prospectus dated ________, 199_, as supplemented by a final prospectus
supplement dated _________, which pursuant to Form S-3 incorporates by reference
the Annual Report on Form 10-K of the Company for the fiscal year ended
________________, 199_, the Quarterly Reports on Form 10-Q of the Company for
the quarters ended _________ the Current Reports on Form 8-K of the Company,
dated __________ (the "Exchange Act Documents"), each as filed under the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
In addition, we have examined, and have relied as to matters
of fact upon, the documents delivered to you at the closing (except the Notes,
of which we have examined a specimen), and we have made such other and further
investigations as we deemed necessary to express the opinions hereinafter set
forth. In such examination, we have assumed the genuineness of all signatures,
the legal capacity of natural persons, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified or photostatic copies, and the
authenticity of the originals of such latter documents.
The Indenture and the Underwriting Agreement are herein
referred to as the "Agreements".
Based upon the foregoing, and subject to the qualifications
and limitations stated herein, we are of the opinion, relying as aforesaid and
as to all matters covered hereby which are governed by or dependent upon the law
of the State of Alabama upon the opinion of Balch & Bingham LLP, dated the date
hereof and addressed to you that:
1. The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Alabama and has due corporate authority to carry on the public utility business
in which it is engaged and to own and operate the properties used by it in such
business and to enter into and perform its obligations under the Agreements and
the Notes.
2. The execution, delivery and performance by the Company of
the Underwriting Agreement have been duly authorized by all necessary corporate
action, and the Underwriting Agreement has been duly executed and delivered by
the Company.
3. All orders, consents, or other authorizations or approvals
of the Alabama Public Service Commission and the Commission legally required for
the issuance and sale of the Notes have been obtained; such orders are
sufficient for the issuance and sale of the Notes; the issuance and sale of the
Notes conform in all material respects with the terms of such orders; and no
other order, consent or other authorization or approval of any Alabama or United
States governmental body (other than in connection or in compliance with the
provisions of the securities or "blue sky" laws of any jurisdiction, as to which
we express no opinion) is legally required for the issuance and sale of the
Notes in accordance with the terms of the Underwriting Agreement.
4. The Indenture has been duly authorized, executed and
delivered by the Company and, assuming the due authorization, execution and
delivery thereof by the Trustee, constitutes a valid and legally binding
instrument of the Company, enforceable against the Company in accordance with
its terms, subject to the qualifications that the enforceability of the
Company's obligations under the Indenture may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law); and the Indenture conforms as to legal matters in all
material respects to the description thereof in the Final Supplemented
Prospectus.
5. The Notes have been duly authorized and executed by the
Company and, when authenticated by the Trustee in the manner provided in the
Indenture and delivered to and paid for by the Underwriter pursuant to the
Underwriting Agreement, will constitute valid and binding obligations of the
Company enforceable against the Company in accordance with their terms, subject
to the qualifications that the enforceability of the Company's obligations under
the Notes may be limited by bankruptcy, insolvency, reorganization, moratorium
and other similar laws relating to or affecting creditors' rights generally and
by general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law); and the Notes conform as to
legal matters in all material respects to the description thereof in the Final
Supplemented Prospectus.
6. The Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended.
We have not independently verified the accuracy, completeness
or fairness of the statements made or included in the Registration Statement,
the Final Supplemented Prospectus or the Exchange Act Documents and take no
responsibility therefor, except as and to the extent set forth in paragraphs 4
and 5 above. In the course of the preparation by the Company of the Registration
Statement, the Final Supplemented Prospectus and the Exchange Act Documents, we
participated in conferences with certain officers and employees of the Company,
with representatives of Arthur Andersen LLP and with counsel to the Company.
Based upon our examination of the Registration Statement, the Final Supplemented
Prospectus and the Exchange Act Documents, our investigations made in connection
with the preparation of the Registration Statement and the Final Supplemented
Prospectus and our participation in the conferences referred to above, (i) we
are of the opinion that the Registration Statement, as of its effective date,
and the Final Supplemented Prospectus, as of ___________, complied as to form in
all material respects with the requirements of the Act and the applicable rules
and regulations of the Commission thereunder and that the Exchange Act
Documents, as of their respective dates of filing with the Commission, complied
as to form in all material respects with the relevant requirements of the
Exchange Act and the applicable rules and regulations of the Commission
thereunder, except that in each case we express no opinion as to the financial
statements or other financial or statistical data contained or incorporated by
reference in the Registration Statement, the Final Supplemented Prospectus or
the Exchange Act Documents, and (ii) nothing came to our attention which gives
us reason to believe that the Registration Statement, as of its effective date
(including the Exchange Act Documents on file with the Commission as of such
date), contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary in order to make the
statements therein not misleading, or that the Final Supplemented Prospectus
(including the Exchange Act Documents) contains any untrue statement of a
material fact or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except that in each case we express no opinion or belief
with respect to the financial statements or other financial or statistical data
contained or incorporated by reference in the Registration Statement, the Final
Supplemented Prospectus or the Exchange Act Documents and with respect to
information set forth in the Final Supplemented Prospectus under the captions
"Description of the Series E Senior Notes - Book-Entry Only Issuance - The
Depository Trust Company" and "The Insurer."
We are members of the State Bar of New York and we do not
express any opinion herein concerning any law other than the law of the State of
New York and the federal law of the United States, and to the extent set forth
herein, the law of the State of Alabama.
This opinion is rendered solely to you in connection with the
above matter. This opinion may not be relied upon by you for any other purpose
or relied upon by or furnished to any other person without our prior written
consent except that Balch & Bingham LLP and Troutman Sanders LLP may rely on
this opinion in giving their opinions pursuant to Section 5 of the Underwriting
Agreement, insofar as such opinions relate to matters of New York law, and Balch
& Bingham LLP may rely on this opinion in giving its opinion pursuant to
Sections 102, 302 and 904 of the Indenture, insofar as such opinion relates to
matters of New York law.
Very truly yours,
DEWEY BALLANTINE LLP
<PAGE>
___________, 1998
Page 2
Schedule V
[Letterhead of Kutak Rock]
__________ __, 199_
Goldman, Sachs & Co.
Prudential Securities Incorporated
c/o Goldman, Sachs & Co., as Representative
85 Broad Street
New York, New York 10004
Alabama Power Company
600 North 18th Street
Birmingham, Alabama 35291
The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001
ALABAMA POWER COMPANY
Series E __ % Senior Notes
Due September 30, 2010
Ladies and Gentlemen:
We have acted as special counsel to the MBIA Insurance Corporation (the
"Corporation") in connection with the issuance of Financial Guaranty Insurance
Policy No. _____ (the "Policy") relating to $___,000,000 ALABAMA POWER COMPANY
Series E ____% Senior Notes due September 30, 2010.
We are familiar with and have examined a copy of the Policy and such
other relevant documents as we have deemed necessary.
Based upon the foregoing, we are of the following opinion:
1. The Corporation is a stock insurance corporation, duly
incorporated and validly existing under the laws of the State of New
York, and is licensed and authorized to issue the Policy under the laws
of the State of New York.
2. The Policy has been duly executed and is a valid and
binding obligation of the Corporation enforceable in accordance with
its terms except that the enforcement of the Policy may be limited by
laws relating to bankruptcy, insolvency, reorganization, moratorium,
receivership and other similar laws affecting creditors' rights
generally and by general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law).
3. The Policy is not required to be registered under the
Securities Act of 1933, as amended.
4. The statements set forth under the caption "THE POLICY" in
the Prospectus Supplement dated September __, 1998 (the "Prospectus
Supplement") insofar as such statements constitute a description of the
Policy, accurately summarize the Policy.
We have not reviewed and render no opinion with respect to any
financial information contained in the Prospectus Supplement.
Very truly yours,
Exhibit 4.2
ALABAMA POWER COMPANY
TO
THE CHASE MANHATTAN BANK,
TRUSTEE.
FIFTH SUPPLEMENTAL INDENTURE
DATED AS OF SEPTEMBER 17, 1998
$100,000,000
SERIES E 6.25% SENIOR NOTES
DUE SEPTEMBER 30, 2010
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS1
PAGE
ARTICLE 1Series E Senior Notes.........................................4
<S> <C>
SECTION 101. Establishment.......................................................................................4
SECTION 102. Definitions.........................................................................................4
SECTION 103. Payment of Principal and Interest...................................................................5
SECTION 104. Denominations.......................................................................................5
SECTION 105. Global Securities...................................................................................5
SECTION 106. Transfer............................................................................................6
SECTION 107. Redemption at the Company's Option..................................................................6
SECTION 108. Redemption at the Holder's Option...................................................................7
ARTICLE 2Special Insurance Provisions.....................................9
SECTION 201. Supplemental Indentures.............................................................................9
SECTION 202. Events of Default and Remedies......................................................................9
SECTION 203. Insurance Policy Payment Procedures.................................................................9
SECTION 204. Application of Term "Outstanding" to Series E Notes................................................11
SECTION 205. Insurer as Third Party Beneficiary.................................................................11
SECTION 206. Notices............................................................................................11
SECTION 207. Concerning the Special Insurance Provisions........................................................11
SECTION 208. Amendments or Supplements..........................................................................11
<PAGE>
ARTICLE 3Miscellaneous Provisions......................................12
SECTION 301. Recitals by Company................................................................................12
SECTION 302. Ratification and Incorporation of Original Indenture...............................................12
SECTION 303. Executed in Counterparts...........................................................................12
</TABLE>
<PAGE>
THIS FIFTH SUPPLEMENTAL INDENTURE is made as of the 17th day
of September, 1998, by and between ALABAMA POWER COMPANY, an Alabama
corporation, 600 North 18th Street, Birmingham, Alabama 35291 (the "Company"),
and THE CHASE MANHATTAN BANK, a New York banking corporation, 450 West 33rd
Street, New York, New York 10001 (the "Trustee").
W I T N E S S E T H:
WHEREAS, the Company has heretofore entered into a Senior Note
Indenture, dated as of December 1, 1997 (the "Original Indenture"), with the
Trustee, as supplemented by a First Supplemental Indenture, dated as of December
12, 1997 (the "First Supplemental Indenture"), a Second Supplemental Indenture
dated as of February 26, 1998 (the "Second Supplemental Indenture"), a Third
Supplemental Indenture, dated as of April 23, 1998 (the "Third Supplemental
Indenture"), and a Fourth Supplemental Indenture, dated as of August 19, 1998
(the "Fourth Supplemental Indenture");
WHEREAS, the Original Indenture is incorporated herein by this
reference and the Original Indenture, as heretofore supplemented and as
supplemented by this Fifth Supplemental Indenture, is herein called the
"Indenture";
WHEREAS, under the Original Indenture, a new series of Senior
Notes may at any time be established pursuant to a supplemental indenture
executed by the Company and the Trustee;
WHEREAS, the Company proposes to create under the Indenture a
new series of Senior Notes;
WHEREAS, additional Senior Notes of other series hereafter
established, except as may be limited in the Original Indenture as at the time
supplemented and modified, may be issued from time to time pursuant to the
Indenture as at the time supplemented and modified; and
WHEREAS, all conditions necessary to authorize the execution
and delivery of this Fifth Supplemental Indenture and to make it a valid and
binding obligation of the Company have been done or performed.
NOW, THEREFORE, in consideration of the agreements and
obligations set forth herein and for other good and valuable consideration, the
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as
follows:
<PAGE>
ARTICLE 1
Series E Senior Notes
. There is hereby established a new series of Senior Notes to be issued
under the Indenture, to be designated as the Company's Series E 6.25% Senior
Notes due September 30, 2010 (the "Series E Notes").
There are to be authenticated and delivered $100,000,000 principal
amount of Series E Notes, and no further Series E Notes shall be authenticated
and delivered except as provided by Sections 203, 303, 304, 907 or 1107 of the
Original Indenture. The Series E Notes shall be issued in definitive fully
registered form.
The Series E Notes shall be issued in the form of one Global Security
in substantially the form set out in Exhibit A hereto. The Depositary with
respect to the Series E Notes shall be The Depository Trust Company.
The form of the Trustee's Certificate of Authentication for the Series
E Notes shall be in substantially the form set forth in Exhibit B hereto.
Each Series E Note shall be dated the date of authentication thereof
and shall bear interest from the date of original issuance thereof or from the
most recent Interest Payment Date to which interest has been paid or duly
provided for.
. The following defined terms used herein shall, unless the context
otherwise requires, have the meanings specified below. Capitalized terms used
herein for which no definition is provided herein shall have the meanings set
forth in the Original Indenture.
"Insurance Paying Agent" means State Street Bank and Trust Company,
N.A., New York, New York, or any successor thereto, as the Fiscal Agent under
the Policy.
"Insurer" means MBIA Insurance Corporation, a New York-domiciled stock
insurance corporation.
"Interest Payment Dates" means March 31, June 30, September 30, and
December 31 of each year.
"Original Issue Date" means September 17, 1998.
"Policy" means the financial guaranty insurance policy issued by the
Insurer with respect to regularly scheduled payments due for principal of and
interest on the Series E Notes as provided in such policy.
"Regular Record Date" means, with respect to each Interest Payment
Date, the close of business on the 15th calendar day preceding such Interest
Payment Date.
<PAGE>
"Stated Maturity" means September 30, 2010.
. The principal of the Series E Notes shall be due at Stated Maturity
(unless earlier redeemed). The unpaid principal amount of the Series E Notes
shall bear interest at the rate of 6.25% per annum until paid or duly provided
for. Interest shall be paid quarterly in arrears on each Interest Payment Date
to the Person in whose name the Series E Notes are registered on the Regular
Record Date for such Interest Payment Date, provided that interest payable at
the Stated Maturity of principal or on a Redemption Date as provided herein will
be paid to the Person to whom principal is payable. Any such interest that is
not so punctually paid or duly provided for will forthwith cease to be payable
to the Holders on such Regular Record Date and may either be paid to the Person
or Persons in whose name the Series E Notes are registered at the close of
business on a Special Record Date for the payment of such defaulted interest to
be fixed by the Trustee, notice whereof shall be given to Holders of the Series
E Notes not less than ten (10) days prior to such Special Record Date, or be
paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange, if any, on which the Series E Notes
shall be listed, and upon such notice as may be required by any such exchange,
all as more fully provided in the Original Indenture.
Payments of interest on the Series E Notes will include interest
accrued to but excluding the respective Interest Payment Dates. Interest
payments for the Series E Notes shall be computed and paid on the basis of a
360-day year of twelve 30-day months. In the event that any date on which
interest is payable on the Series E Notes is not a Business Day, then a payment
of the interest payable on such date will be made on the next succeeding day
that is a Business Day, except that, if such Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on the date the payment was originally payable.
Payment of the principal and interest due at the Stated Maturity or
earlier redemption of the Series E Notes shall be made upon surrender of the
Series E Notes at the Corporate Trust Office of the Trustee. The principal of
and interest on the Series E Notes shall be paid in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts. Payments of interest (including interest on any
Interest Payment Date) will be made, subject to such surrender where applicable,
at the option of the Company, (i) by check mailed to the address of the Person
entitled thereto as such address shall appear in the Security Register or (ii)
by wire transfer at such place and to such account at a banking institution in
the United States as may be designated in writing to the Trustee at least
sixteen (16) days prior to the date for payment by the Person entitled thereto.
. The Series E Notes may be issued in the denominations of $1,000, or
any integral multiple thereof.
. The Series E Notes will be issued in the form of one or more Global
Securities registered in the name of the Depositary (which shall be The
Depository Trust Company) or its nominee. Except under the limited circumstances
described below, Series E Notes represented by the Global Security will not be
exchangeable for, and will not otherwise be issuable as, Series E Notes in
definitive form. The Global Securities described above may not be transferred
except by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary or to a
successor Depositary or its nominee.
Owners of beneficial interests in such a Global Security will not be
considered the Holders thereof for any purpose under the Indenture, and no
Global Security representing a Series E Note shall be exchangeable, except for
another Global Security of like denomination and tenor to be registered in the
name of the Depositary or its nominee or to a successor Depositary or its
nominee. The rights of Holders of such Global Security shall be exercised only
through the Depositary.
A Global Security shall be exchangeable for Series E Notes registered
in the names of persons other than the Depositary or its nominee only if (i) the
Depositary notifies the Company that it is unwilling or unable to continue as a
Depositary for such Global Security and no successor Depositary shall have been
appointed by the Company, or if at any time the Depositary ceases to be a
clearing agency registered under the Securities Exchange Act of 1934, as
amended, at a time when the Depositary is required to be so registered to act as
such Depositary and no successor Depositary shall have been appointed by the
Company, in each case within 90 days after the Company receives such notice or
becomes aware of such cessation, (ii) the Company in its sole discretion
determines that such Global Security shall be so exchangeable, or (iii) there
shall have occurred an Event of Default with respect to the Series E Notes. Any
Global Security that is exchangeable pursuant to the preceding sentence shall be
exchangeable for Series E Notes registered in such names as the Depositary shall
direct.
. No service charge will be made for any transfer or exchange of Series
E Notes, but payment will be required of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection therewith.
The Company shall not be required (a) to issue, transfer or exchange
any Series E Notes except to the Insurer during a period beginning at the
opening of business fifteen (15) days before the day of the mailing of a notice
pursuant to Section 1104 of the Original Indenture identifying the serial
numbers of the Series E Notes to be called for redemption, and ending at the
close of business on the day of the mailing, or (b) to transfer or exchange any
Series E Notes theretofore selected for redemption in whole or in part, except
the unredeemed portion of any Series E Note redeemed in part.
. The Series E Notes shall be subject to redemption at the option of
the Company, in whole or in part, without premium or penalty, at any time or
from time to time on or after September 17, 2002, at a Redemption Price equal to
100% of the principal amount to be redeemed plus accrued but unpaid interest to
the Redemption Date.
In the event of redemption of the Series E Notes in part only, a new
Series E Note or Notes for the unredeemed portion will be issued in the name or
names of the Holders thereof upon the surrender thereof.
The Series E Notes will not have a sinking fund.
Notice of redemption shall be given as provided in Section 1104 of the
Original Indenture.
Any redemption of less than all of the Series E Notes shall, with
respect to the principal thereof, be divisible by $1,000.
. For purposes of this Section 108, a "Beneficial Owner" means the
Person who has the right to sell, transfer or otherwise dispose of an interest
in a Series E Note and the right to receive the proceeds therefrom, as well as
the interest and principal payable to the Holder thereof. In general, a
determination of beneficial ownership in the Series E Notes will be subject to
the rules, regulations and procedures governing the Depositary and institutions
that have accounts with the Depositary or a nominee thereof ("Participants").
Unless the Series E Notes have been declared due and payable prior to
their maturity by reason of an Event of Default, the Representative (as
hereinafter defined) of a deceased Beneficial Owner has the right to request
redemption prior to Stated Maturity of all or part of his interest, expressed in
integral multiples of $1,000 principal amount, in the Series E Notes, and the
Company will redeem the same subject to the limitations that the Company will
not be obligated to redeem, during the period from the Original Issue Date
through and including October 1, 1999 (the "Initial Period"), and during any
twelve-month period which ends on and includes each October 1 thereafter (each
such twelve-month period being hereinafter referred to as a "Subsequent
Period"), (i) on behalf of a deceased Beneficial Owner any interest in the
Series E Notes which exceeds an aggregate principal amount of $25,000 or (ii)
interests in the Series E Notes in an aggregate principal amount exceeding
$2,000,000. A request for redemption may be initiated by the Representative of a
deceased Beneficial Owner at any time and in any principal amount in integral
multiples of $1,000. If the Company, although not obligated to do so, chooses to
redeem interests of any deceased Beneficial Owner in the Series E Notes in the
Initial Period or any Subsequent Period in excess of the $25,000 limitation,
such redemption, to the extent that it exceeds the $25,000 limitation for any
deceased Beneficial Owner, shall not be included in the computation of the
$2,000,000 limitation for such Initial Period or such Subsequent Period, as the
case may be, or for any succeeding Subsequent Period.
Subject to the $25,000 and $2,000,000 limitations, the Company will,
after the death of any Beneficial Owner, redeem the interest of such Beneficial
Owner in the Series E Notes within 60 days following receipt by the Trustee of a
Redemption Request (as herein defined). If Redemption Requests exceed the
aggregate principal amount of interests in Series E Notes required to be
redeemed during the Initial Period or during any Subsequent Period, then such
excess Redemption Requests will be applied in the order received by the Trustee
to successive Subsequent Periods, regardless of the number of Subsequent Periods
required to redeem such interests.
A request for redemption of an interest in the Series E Notes may be
initiated by the personal representative or other Person authorized to represent
the estate of the deceased Beneficial Owner or from a surviving joint tenant(s)
or tenant(s) by the entirety (each, a "Representative"). The Representative
shall deliver a request to the Participant through whom the deceased Beneficial
Owner owned such interest, in form satisfactory to the Participant, together
with evidence of the death of the Beneficial Owner, evidence of the authority of
the Representative satisfactory to the Participant, such waivers, notices or
certificates as may be required under applicable state or federal law and such
other evidence of the right to such redemption as the Participant shall require.
The request shall specify the principal amount of the interest in the Series E
Notes to be redeemed. The Participant shall thereupon deliver to the Depositary
a request for redemption substantially in the form attached as Exhibit C hereto
(a "Redemption Request"), accompanied by the documents submitted to the
Participant as above provided, and the Depositary will forward the same to the
Trustee. Documents accompanying Redemption Requests shall be in form
satisfactory to the Company. The Trustee may conclusively assume, without
independent investigation, that the statements contained in each Redemption
Request are true and correct and shall have no responsibility for reviewing any
documents accompanying a Redemption Request or for determining whether the
applicable decedent is in fact the Beneficial Owner of the interest in the
Series E Note to be redeemed or is in fact deceased and whether the
Representative is duly authorized to request redemption on behalf of the
applicable Beneficial Owner.
The price to be paid by the Company for interests in the Series E Notes
to be redeemed pursuant to a Redemption Request is 100% of the principal amount
thereof plus accrued but unpaid interest to the date of payment. Subject to
arrangements with the Depositary, payment for interests in the Series E Notes
which are to be redeemed shall be made to the Depositary upon presentation of
Series E Notes to the Trustee for redemption in the aggregate principal amount
specified in the Redemption Requests submitted to the Trustee by the Depositary
which are to be fulfilled in connection with such payment. The principal amount
of any Series E Notes acquired or redeemed by the Company other than by
redemption at the option of any Representative of a deceased Beneficial Owner
pursuant to this Section 108 shall not be included in the computation of either
the $25,000 or the $2,000,000 limitation for the Initial Period or for any
Subsequent Period.
For purposes of this Section 108, an interest in a Series E Note held
in tenancy by the entirety, joint tenancy or by tenants in common will be deemed
to be held by a single Beneficial Owner and the death of a tenant by the
entirety, joint tenant or tenant in common will be deemed the death of a
Beneficial Owner. The death of a Person who, during his lifetime, was entitled
to substantially all of the rights of a Beneficial Owner of an interest in the
Series E Notes will be deemed the death of the Beneficial Owner, regardless of
the recordation of such interest on the records of the Participant, if such
rights can be established to the satisfaction of the Participant and the
Company. Such interests shall be deemed to exist in typical cases of nominee
ownership, ownership under the Uniform Gifts to Minors Act or the Uniform
Transfers to Minors Act, community property or other similar joint ownership
arrangements, including individual retirement accounts or Keogh [H.R. 10] plans
maintained solely by or for the decedent or by or for the decedent and any
spouse, and trust and certain other arrangements where one Person has
substantially all of the rights of a Beneficial Owner during such Person's
lifetime.
In the case of any Redemption Request which is presented pursuant to
this Section 108 and which has not been fulfilled at the time the Company gives
notice of its election to redeem Series
<PAGE>
E Notes pursuant to Section 107 hereof, such interest or portion thereof shall
not be subject to redemption pursuant to such Section 107, but shall remain
subject to redemption pursuant to this Section 108.
Subject to the provisions of the immediately preceding sentence, any
Redemption Request may be withdrawn by the Person(s) presenting the same upon
delivery of a written request for such withdrawal given by the Depositary to the
Trustee prior to payment of such Redemption Request.
During such time or times as, in accordance with Section 105 hereof,
the Series E Notes are not represented by a Global Security and are issued in
definitive form, all references in this Section 108 to Participants and the
Depositary, including the Depositary's governing rules, regulations and
procedures shall be deemed deleted, all determinations which under this Section
108 the Participants are required to make shall be made by the Company
(including, without limitation, determining whether the applicable decedent is
in fact the Beneficial Owner of the interest in the Series E Note to be redeemed
or is in fact deceased and whether the Representative is duly authorized to
request redemption on behalf of the applicable Beneficial Owner), all redemption
requests, to be effective, shall be delivered by the Representative to the
Trustee, with a copy to the Company, and shall be in the form of a Redemption
Request (with appropriate changes to reflect the fact that such Redemption
Request is being executed by a Representative) and, in addition to all documents
that are otherwise required to accompany a Redemption Request, shall be
accompanied by the Series E Note that is the subject of such request.
ARTICLE 2
Special Insurance Provisions
. The consent of the Insurer shall be required with respect to any
indenture or indentures supplemental to the Original Indenture requiring the
consent of the Holders of the Series E Notes pursuant to Section 902 of the
Original Indenture.
. Subject to Section 107 of the Original Indenture and to the Trust
Indenture Act, including, without limitation, Sections 316(a)(1) and 317(a)
thereof, if an Event of Default with respect to the Series E Notes occurs and is
continuing, the Insurer shall be entitled to control and direct the enforcement
of all rights and remedies granted to the Holders of the Series E Notes or the
Trustee for the benefit of the Holders of the Series E Notes under the
Indenture, including, without limitation, (i) the right to accelerate the
principal of the Series E Notes as provided in Section 502 of the Original
Indenture, and (ii) the right to annul any such declaration of acceleration, and
the Insurer shall also be entitled to approve any waiver of an Event of Default
with respect to the Series E Notes, the obligation of the Trustee to comply with
any such direction to be subject to compliance with the conditions set forth in
Sections 512 and 603(e) of the Original Indenture (as if references in those
Sections to Holders were references to the Insurer) and the protections provided
to the Trustee by Section 601(c)(3) of the Original Indenture shall be
applicable with respect to any direction from the Insurer given pursuant hereto
(as if references in said Section to Holders were references to the Insurer).
<PAGE>
. (a) If the Trustee does not have sufficient funds for any payment of
principal or interest on the due date or if the Trustee has notice that any
Holder has been required to disgorge payments of principal or interest on the
Series E Notes to a trustee in bankruptcy or creditors or others pursuant to a
final judgment by a court of competent jurisdiction that such payment
constitutes an avoidable preference to such Holder within the meaning of any
applicable bankruptcy laws, then the Trustee shall notify the Insurer or its
designee of such fact by telephone or telegraphic notice, confirmed in writing
by registered or certified mail.
(b) The Trustee is hereby irrevocably designated, appointed, directed
and authorized to act as attorney-in-fact for Holders of the Series E Notes as
follows:
1. If and to the extent there is a deficiency in amounts
required to pay interest on the Series E Notes, the Trustee shall (a)
execute and deliver to the Insurance Paying Agent, in form satisfactory
to the Insurance Paying Agent, an instrument appointing the Insurer as
agent for such Holders in any legal proceeding related to the payment
of such interest and an assignment to the Insurer of the claims for
interest to which such deficiency relates and which are paid by the
Insurer, (b) receive as designee of the respective Holders (and not as
Trustee) in accordance with the tenor of the Policy payment from the
Insurance Paying Agent with respect to the claims for interest so
assigned, and (c) disburse the same to such respective Holders; and
2. If and to the extent of a deficiency in amounts required to
pay principal of the Series E Notes, the Trustee shall (a) execute and
deliver to the Insurance Paying Agent in form satisfactory to the
Insurance Paying Agent an instrument appointing the Insurer as agent
for such Holders in any legal proceeding relating to the payment of
such principal and an assignment to the Insurer of any of the Series E
Notes surrendered to the Insurance Paying Agent to the extent of the
principal amount thereof as has not previously been paid or for which
moneys are not held by the Trustee and available for such payment (but
such assignment shall be delivered only if payment from the Insurance
Paying Agent is received), (b) receive as designee of the respective
Holders (and not as Trustee) in accordance with the tenor of the Policy
payment therefor from the Insurance Paying Agent, and (c) disburse the
same to such Holders.
(c) Payments with respect to claims for interest on and principal of
Series E Notes disbursed by the Trustee from proceeds of the Policy shall not be
considered to discharge the obligation of the Company with respect to such
Series E Notes, and the Insurer shall become the owner of such unpaid Series E
Note and claims for the interest thereon in accordance with the tenor of the
assignment made to it under the provisions of this subsection or otherwise.
(d) Irrespective of whether any such assignment is executed and
delivered, the Company and the Trustee hereby agree for the benefit of the
Insurer that,
1. They recognize that to the extent the Insurer makes
payments, directly or indirectly (as by paying through the Trustee), on
account of principal of or interest on the Series E Notes, the Insurer
will be subrogated to the rights of such Holders to receive the amount
of such principal and interest from the Company, with interest thereon
as provided and solely from the sources stated in the Indenture and the
Series E Notes; and
2. They will accordingly pay to the Insurer the amount of such
principal and interest (including principal and interest recovered
under subparagraph (ii) of the first paragraph of the Policy, which
principal and interest shall be deemed past due and not to have been
paid), with interest thereon as provided in the Indenture and the
Series E Note, but only from the sources and in the manner provided
herein for the payment of principal of and interest on the Series E
Notes to Holders, and will otherwise treat the Insurer as the owner of
such rights to the extent of the amount of such principal and interest.
. In the event that the principal and/or interest due on the Series E
Notes shall be paid by the Insurer pursuant to the Policy, the Series E Notes
shall remain Outstanding for all purposes of the Indenture, not be considered
defeased or otherwise satisfied and not be considered paid by the Company, and
the Indenture and all covenants, agreements and other obligations of the Company
to the Holders of the Series E Notes shall continue to exist and such covenants,
agreements and other obligations shall run to the benefit of the Insurer, and
the Insurer shall be subrogated to the rights of such Holders to the extent of
each such payment.
. To the extent that the Indenture confers upon or gives or grants to
the Insurer any right, remedy or claim under or by reason of the Indenture, the
Insurer is hereby explicitly recognized as being a third-party beneficiary
hereunder and may enforce any such right, remedy or claim conferred, given or
granted hereunder.
. Any notice that is required to be given to a Holder of the Series E
Note or to the Trustee pursuant to the Indenture shall also be provided to the
Insurer. All notices required to be given to the Insurer under the Indenture
shall be in writing and shall be sent by registered or certified mail addressed
to MBIA Insurance Corporation, 113 King Street, Armonk, New York 10504,
Attention: Surveillance.
. The provisions of this Article 2 shall apply notwithstanding anything
in the Indenture to the contrary, but only so long as the Policy shall be in
full force and effect and the Insurer is not in default thereunder.
. The Trustee, in determining whether any amendments or supplements to
the Indenture may be made without the consent of the Holders, or in determining
whether any action should be taken, shall consider the effect of such action on
the rights of the Holders as if the Policy were not in effect.
<PAGE>
ARTICLE 3
Miscellaneous Provisions
. The recitals in this Fifth Supplemental Indenture are made by the
Company only and not by the Trustee, and all of the provisions contained in the
Original Indenture in respect of the rights, privileges, immunities, powers and
duties of the Trustee shall be applicable in respect of Series E Notes and of
this Fifth Supplemental Indenture as fully and with like effect as if set forth
herein in full.
. As heretofore supplemented and as supplemented hereby, the Original
Indenture is in all respects ratified and confirmed, and the Original Indenture,
the First Supplemental Indenture, the Second Supplemental Indenture, the Third
Supplemental Indenture, the Fourth Supplemental Indenture and this Fifth
Supplemental Indenture shall be read, taken and construed as one and the same
instrument.
. This Fifth Supplemental Indenture may be simultaneously executed in
several counterparts, each of which shall be deemed to be an original, and such
counterparts shall together constitute but one and the same instrument.
<PAGE>
IN WITNESS WHEREOF, each party hereto has caused this
instrument to be signed in its name and behalf by its duly authorized officers,
all as of the day and year first above written.
ATTEST: ALABAMA POWER COMPANY
By: By:
Patricia B. Southerland William B. Hutchins, III
Assistant Secretary Executive Vice President,
Chief Financial Officer and
Treasurer
ATTEST: THE CHASE MANHATTAN BANK, as Trustee
By: By:
Senior Trust Officer Senior Trust Officer
<PAGE>
EXHIBIT A
FORM OF SERIES E NOTE
<TABLE>
<CAPTION>
NO. __ CUSIP NO. 010392DH8
ALABAMA POWER COMPANY
SERIES E 6.25% SENIOR NOTE
DUE SEPTEMBER 30, 2010
<S> <C>
------------------------------------ -----------------------------------------------------------------------
Principal Amount: $_____________
------------------------------------ -----------------------------------------------------------------------
------------------------------------ -----------------------------------------------------------------------
Regular Record Date: 15th calendar day prior to Interest Payment Date
------------------------------------ -----------------------------------------------------------------------
------------------------------------ -----------------------------------------------------------------------
Original Issue Date: September 17, 1998
------------------------------------ -----------------------------------------------------------------------
------------------------------------ -----------------------------------------------------------------------
Stated Maturity: September 30, 2010
------------------------------------ -----------------------------------------------------------------------
------------------------------------ -----------------------------------------------------------------------
Interest Payment Dates: March 31, June 30, September 30 and December 31
------------------------------------ -----------------------------------------------------------------------
------------------------------------ -----------------------------------------------------------------------
Interest Rate: 6.25% per annum
------------------------------------ -----------------------------------------------------------------------
------------------------------------ -----------------------------------------------------------------------
Authorized Denomination: $1,000
------------------------------------ -----------------------------------------------------------------------
------------------------------------ -----------------------------------------------------------------------
Initial Redemption Date: September 17, 2002
------------------------------------ -----------------------------------------------------------------------
</TABLE>
<PAGE>
Alabama Power Company, an Alabama corporation (the "Company", which
term includes any successor corporation under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay to
_______________________________________________, or registered assigns, the
principal sum of _________ DOLLARS ($__________) on the Stated Maturity shown
above (or upon earlier redemption), and to pay interest thereon from the
Original Issue Date shown above, or from the most recent Interest Payment Date
to which interest has been paid or duly provided for, quarterly in arrears on
each Interest Payment Date as specified above, commencing on December 31, 1998,
and on the Stated Maturity (or upon earlier redemption) at the rate per annum
shown above until the principal hereof is paid or made available for payment and
on any overdue principal and on any overdue installment of interest. The
interest so payable, and punctually paid or duly provided for, on any Interest
Payment Date (other than an Interest Payment Date that is the Stated Maturity or
on a Redemption Date) will, as provided in such Indenture, be paid to the Person
in whose name this Note (the "Note") is registered at the close of business on
the Regular Record Date as specified above next preceding such Interest Payment
Date, provided that any interest payable at Stated Maturity or on any Redemption
Date will be paid to the Person to whom principal is payable. Except as
otherwise provided in the Indenture, any such interest not so punctually paid or
duly provided for will forthwith cease to be payable to the Holder on such
Regular Record Date and may either be paid to the Person in whose name this Note
is registered at the close of business on a Special Record Date for the payment
of such defaulted interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Notes of this series not less than 10 days prior to such
Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange, if any, on which
the Notes of this series shall be listed, and upon such notice as may be
required by any such exchange, all as more fully provided in the Indenture.
Payments of interest on this Note will include interest accrued to but
excluding the respective Interest Payment Dates. Interest payments for this Note
shall be computed and paid on the basis of a 360-day year of twelve 30-day
months. In the event that any date on which interest is payable on this Note is
not a Business Day, then payment of the interest payable on such date will be
made on the next succeeding day that is a Business Day, except that, if such
Business Day is in the next succeeding calendar year, payment shall be made on
the immediately preceding Business Day, in each case with the same force and
effect as if made on the date the payment was originally payable. A "Business
Day" shall mean any day other than a Saturday or a Sunday or a day on which
banking institutions in New York City are authorized or required by law or
executive order to remain closed or a day on which the Corporate Trust Office of
the Trustee is closed for business.
Payment of the principal of and interest due at the Stated Maturity or
earlier redemption of the Series E Notes shall be made upon surrender of the
Series E Notes at the Corporate Trust Office of the Trustee. The principal of
and interest on the Series E Notes shall be paid in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts. Payment of interest (including interest on an
Interest Payment Date) will be made, subject to such surrender where applicable,
at the option of the Company, (i) by check mailed to the address of the Person
entitled thereto as such address shall appear in the Security Register or (ii)
by wire transfer at such place and to such account at a banking institution in
the United States as may be designated in writing to the Trustee at least 16
days prior to the date for payment by the Person entitled thereto.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET
FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES
HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been executed by
the Trustee by manual signature, this Note shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
ALABAMA POWER COMPANY
By:
Vice President
Attest:
Assistant Secretary
{Seal of ALABAMA POWER COMPANY appears here}
<PAGE>
CERTIFICATE OF AUTHENTICATION
This is one of the Senior Notes referred to in the within-mentioned
Indenture.
THE CHASE MANHATTAN BANK,
as Trustee
By:
Authorized Officer
<PAGE>
(Reverse Side of Note)
This Note is one of a duly authorized issue of Senior Notes of the
Company (the "Notes"), issued and issuable in one or more series under a Senior
Note Indenture, dated as of December 1, 1997, as supplemented (the "Indenture"),
between the Company and The Chase Manhattan Bank, Trustee (the "Trustee," which
term includes any successor trustee under the Indenture), to which Indenture and
all indentures incidental thereto reference is hereby made for a statement of
the respective rights, limitation of rights, duties and immunities thereunder of
the Company, the Trustee and the Holders of the Notes issued thereunder and of
the terms upon which said Notes are, and are to be, authenticated and delivered.
This Note is one of the series designated on the face hereof as Series E 6.25%
Senior Notes due September 30, 2010 (the "Series E Notes") in the aggregate
principal amount of up to $100,000,000. Capitalized terms used herein for which
no definition is provided herein shall have the meanings set forth in the
Indenture.
The Company shall have the right, subject to the terms and conditions
of the Indenture, to redeem this Note at any time on or after September 17, 2002
at the option of the Company, without premium or penalty, in whole or in part,
at a Redemption Price equal to 100% of the principal amount to be redeemed plus
accrued but unpaid interest to the Redemption Date.
In addition, at the option of any deceased Beneficial Owner's
Representative, interests in the Series E Notes are redeemable at 100% of their
principal amount, plus accrued interest, subject to certain limitations provided
in the Indenture.
In the event of redemption of this Note in part only, a new Note
or Notes of this series for the unredeemed portion hereof will be issued
in the name of the Holder hereof upon the surrender hereof. The Notes
will not have a sinking fund.
If an Event of Default with respect to the Notes of this series shall
occur and be continuing, the principal of the Notes of this series may be
declared due and payable in the manner, with the effect and subject to the
conditions provided in the Indenture.
<PAGE>
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Notes of each series to be affected
under the Indenture at any time by the Company and the Trustee with the consent
of the Holders of not less than a majority in principal amount of the Notes at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Notes of each series at the time Outstanding, on behalf of the Holders of
all Notes of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note shall
be conclusive and binding upon such Holder and upon all future Holders of this
Note and of any Note issued upon the registration of transfer hereof or in
exchange hereof or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Note.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note is registrable in the Security Register,
upon surrender of this Note for registration of transfer at the office or agency
of the Company for such purpose, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar and duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Notes of this series, of
authorized denominations and of like tenor and for the same aggregate principal
amount, will be issued to the designated transferee or transferees. No service
charge shall be made for any such registration of transfer or exchange, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Notes of this series are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Notes of this series are exchangeable for a like aggregate principal amount of
Notes of this series of a different authorized denomination, as requested by the
Holder surrendering the same upon surrender of the Note or Notes to be exchanged
at the office or agency of the Company.
This Note shall be governed by, and construed in accordance with, the
internal laws of the State of New York.
<PAGE>
STATEMENT OF INSURANCE
MBIA Insurance Corporation (the "Insurer") has issued a financial
guaranty insurance policy (the "Policy") containing the following provisions,
such policy being on file at The Chase Manhattan Bank, 450 West 33rd Street, New
York, New York 10001.
The Insurer, in consideration of the payment of the premium and subject
to the terms of the Policy, hereby unconditionally and irrevocably guarantees to
any owner, as hereinafter defined, of the following described obligations, the
full and complete payment required to be made by or on behalf of the Company to
The Chase Manhattan Bank or its successor (the "Paying Agent") of an amount
equal to (i) the principal of (at the stated maturity) and interest on, the
Obligations (as that term is defined below) as such payments shall become due
but shall not be so paid (except that in the event of any acceleration of the
due date of such principal by reason of mandatory or optional redemption or
acceleration resulting from default or otherwise, the payments guaranteed hereby
shall be made in such amounts and at such times as such payments of principal
would have been due had there not been any such acceleration); and (ii) the
reimbursement of any such payment which is subsequently recovered from any owner
pursuant to a final judgment by a court of competent jurisdiction that such
payment constitutes an avoidable preference to such owner within the meaning of
any applicable bankruptcy law. The amounts referred to in clauses (i) and (ii)
of the preceding sentence shall be referred to herein collectively as the
"Insured Amounts." "Obligations" shall mean:
$100,000,000
ALABAMA POWER COMPANY
SERIES E 6.25% SENIOR NOTES
DUE SEPTEMBER 30, 2010
<PAGE>
Upon receipt of telephonic notice, such notice subsequently confirmed
in writing by registered or certified mail, or upon receipt of written notice by
registered or certified mail, by the Insurer from the Paying Agent or any owner
of an Obligation the payment of an Insured Amount for which is then due, that
such required payment has not been made, the Insurer on the due date of such
payment or within one Business Day after receipt of notice of such nonpayment,
whichever is later, will make a deposit of funds, in an account with State
Street Bank and Trust Company, N.A., in New York, New York, or its successor,
sufficient for the payment of any such Insured Amounts which are then due. Upon
presentment and surrender of such Obligations or presentment of such other proof
of ownership of the Obligations, together with any appropriate instruments of
assignment to evidence the assignment of the Insured Amounts due on the
Obligations as are paid by the Insurer, and appropriate instruments to effect
the appointment of the Insurer as agent for such owners of the Obligations in
any legal proceeding related to payment of Insured Amounts on the Obligations,
such instrument being in a form satisfactory to State Street Bank and Trust
Company, N.A., State Street Bank and Trust Company, N.A. shall disburse to such
owners or the Paying Agent payment of the Insured Amounts due on such
Obligations, less any amount held by the Paying Agent for the payment of such
Insured Amounts and legally available therefor. The Policy does not insure
against loss of any prepayment premium which may at any time be payable with
respect to any Obligation.
As used herein, the term "owner" shall mean the registered owner of any
Obligation as indicated in the books maintained by the Paying Agent, the Company
or any designee of the Company for such purpose. The term owner shall not
include the Company or any party whose agreement with the Company constitutes
the underlying security for the Obligations.
Any service of process on the Insurer may be made to the Insurer at its
offices located at 113 King Street, Armonk, New York 10504 and such service of
process shall be valid and binding.
This policy is non-cancellable for any reason. The premium on this
policy is not refundable for any reason including the payment prior to maturity
of the Obligations.
The insurance provided by the Policy is not covered by the
Property/Casualty Insurance Security Fund specified in Article 76 of the New
York Insurance Law.
MBIA Insurance Corporation
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM- as tenants in UNIF GIFT MIN ACT- _______ Custodian ________
common (Cust) (Minor)
TEN ENT- as tenants by the
entireties under Uniform Gifts to
JT TEN- as joint tenants Minors Act
with right of
survivorship and ________________________
not as tenants (State)
in common
Additional abbreviations may also be used
though not on the above list.
FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto
(please insert Social Security or other identifying number of assignee)
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF
ASSIGNEE
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing
agent to transfer said Note on the books of the Company, with full power of
substitution in the premises.
Dated:
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the within instrument in every particular without
alteration or enlargement, or any change whatever.
<PAGE>
EXHIBIT B
CERTIFICATE OF AUTHENTICATION
This is one of the Senior Notes referred to in the within-mentioned
Indenture.
THE CHASE MANHATTAN BANK,
as Trustee
By:
Authorized Officer
<PAGE>
EXHIBIT C
FORM OF REQUEST FOR REDEMPTION
Alabama Power Company
Series E 6.25% Senior Notes
due September 30, 2010
CUSIP No. 010392DH8
The undersigned Participant does hereby certify, pursuant to Section
108 of the Fifth Supplemental Indenture dated as of September 17, 1998 to the
Indenture dated as of December 1, 1997 between Alabama Power Company (the
"Company") and The Chase Manhattan Bank, as trustee (the "Trustee"), to the
Company and the Trustee that:
1. [Name of deceased Beneficial Owner] is deceased.
2. [Name of deceased Beneficial Owner] had a $___________
interest in the Company's Series E 6.25% Senior Notes due September 30, 2010
(the "Series E Senior Notes").
3. [Name of Representative] is [Beneficial Owner's personal
representative/ other person authorized to represent the estate of the
Beneficial Owner/surviving joint tenant/ surviving tenant by the entirety] of
[Name of deceased Beneficial Owner] and has delivered to the undersigned a
request for redemption in form satisfactory to the undersigned, requesting that
$_______ [$1,000 or an integral multiple thereof] be redeemed pursuant to said
Section 108. Such request and the documents accompanying such request, all of
which are satisfactory to the undersigned, are delivered herewith.
4. [Name of Participant] holds the interest in the Series E
Senior Notes with respect to which this Request for Redemption is being made on
behalf of [Name of deceased Beneficial Owner].
IN WITNESS WHEREOF, the undersigned has executed this Request for
Redemption as of _______________,
- ------.
[Name of Participant]
By:
Name:
Title:
- --------
1This Table of Contents does not constitute part of the Indenture or have
any bearing upon the interpretation of any of its terms and provisions.
EXHIBIT 23
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Prospectus Supplement dated
September 8, 1998 (to Prospectus dated June 30, 1998) of Alabama Power Company
(the "Company"), which is incorporated by reference in Form 8-K of the Company
dated September 8, 1998, of our report dated February 3, 1998 on our audits of
the consolidated financial statements of MBIA Insurance Corporation and
Subsidiaries as of December 31, 1997 and 1996, and for each of the three years
in the period ended December 31, 1997. We also consent to the reference to our
firm under the caption "Experts" in the Prospectus Supplement.
/s/ PricewaterhouseCoopers LLP
New York, New York
September 8, 1998
