<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 30, 1997.
SUBJECT TO AMENDMENT. REGISTRATION NOS. 333-
333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------
<TABLE>
<C> <C> <C>
GEORGIA POWER COMPANY GEORGIA 58-0257110
GEORGIA POWER CAPITAL TRUST III DELAWARE 51-6505002
(Exact name of registrant as (State or other jurisdiction of (I.R.S. Employer Identification
specified incorporation or organization) No.)
in its charter)
</TABLE>
333 PIEDMONT AVENUE, N.E.
ATLANTA, GEORGIA 30308
(404) 526-6526
(Address, including zip code, and telephone number, including area code, of each
registrant's principal executive offices)
---------------------
JUDY M. ANDERSON
VICE PRESIDENT AND CORPORATE SECRETARY
GEORGIA POWER COMPANY
333 PIEDMONT AVENUE, N.E.
ATLANTA, GEORGIA 30308
(404) 526-6526
(Name, address, including zip code, and telephone number, including area code,
of agent for service of each registrant)
---------------------
THE COMMISSION IS REQUESTED TO MAIL SIGNED COPIES OF ALL ORDERS, NOTICES AND
COMMUNICATIONS TO:
<TABLE>
<C> <C>
W . L . WESTBROOK JOHN D. MCLANAHAN, ESQ.
FINANCIAL VICE PRESIDENT TROUTMAN SANDERS LLP
THE SOUTHERN COMPANY 600 PEACHTREE STREET, N.E.
270 PEACHTREE STREET, N.W. SUITE 5200
ATLANTA, GEORGIA 30303 ATLANTA, GEORGIA 30308-2216
</TABLE>
---------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this registration statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ] ________
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ] ________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
---------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=================================================================================================================================
TITLE OF AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
EACH CLASS OF SECURITIES TO BE OFFERING PRICE AGGREGATE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED(1) PER UNIT(1)(2)(3) PRICE(1)(2)(3) FEE(1)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Georgia Power Capital Trust III Preferred Securities.....
- ---------------------------------------------------------------------------------------------------------------------------------
Georgia Power Company Junior Subordinated Notes(4).......
- ---------------------------------------------------------------------------------------------------------------------------------
Georgia Power Company Guarantee with respect to Preferred
Securities of Georgia Power Capital Trust III (4)(5).....
- ---------------------------------------------------------------------------------------------------------------------------------
Total.................................................... $200,000,000 100% $200,000,000 $60,607
=================================================================================================================================
</TABLE>
(1) There are being registered hereunder such presently indeterminate number of
Preferred Securities of Georgia Power Capital Trust III with an aggregate
initial offering price not to exceed $200,000,000, plus an indeterminate
principal amount of Junior Subordinated Notes of Georgia Power Company with
an aggregate principal amount not to exceed $200,000,000 as may be
distributed upon a dissolution of Georgia Power Capital Trust III and the
distribution of the assets thereof, which would include such Junior
Subordinated Notes for which no separate consideration will be received.
Pursuant to Rule 457(o) under the Securities Act of 1933, which permits the
registration fee to be calculated on the basis of the maximum offering price
of all the securities listed, the table does not specify by each class
information as to the amount to be registered, proposed maximum offering
price per unit or proposed maximum aggregate offering price.
(2) Estimated solely for the purpose of determining the registration fee.
(3) Exclusive of accrued interest and distributions, if any.
(4) No separate consideration will be received for the Georgia Power Company
Junior Subordinates Notes or Guarantee. Pursuant to Rule 457(n) no separate
fee is payable in respect of the Georgia Power Company Junior Subordinated
Notes or Guarantee.
(5) Includes the obligations of Georgia Power Company under the Trust Agreement,
the Subordinated Note Indenture, the Junior Subordinated Notes, the
Guarantee and the Agreement as to Expenses and Liabilities, which includes
the Company's covenant to pay any indebtedness, expenses or liabilities of
the Trust (other than obligations pursuant to the terms of the Preferred
Securities or other similar interests), all as described in this
registration statement.
---------------------
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
================================================================================
<PAGE>
A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION BUT HAS NOT YET BECOME EFFECTIVE.
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. THESE
SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE
TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL
NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR
SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR
QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED MAY 30, 1997
PROSPECTUS
8,000,000 PREFERRED SECURITIES
GEORGIA POWER CAPITAL TRUST III
% TRUST PREFERRED SECURITIES
(LIQUIDATION AMOUNT $25 PER PREFERRED SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED, AS SET FORTH HEREIN, BY
GEORGIA POWER COMPANY
A SUBSIDIARY OF THE SOUTHERN COMPANY
---------------------
The % Trust Preferred Securities (the "Preferred Securities") offered
hereby evidence preferred undivided beneficial interests, representing 97%
undivided beneficial interests in the assets of Georgia Power Capital Trust III,
a statutory business trust created under the laws of the State of Delaware (the
"Trust"). Georgia Power Company, a Georgia corporation (the "Company"), will own
all the common securities (the "Common Securities" and, together with the
Preferred Securities, the "Trust Securities") representing the remaining 3%
undivided beneficial interests in the assets of the Trust. The Trust exists for
the sole purpose of issuing the Preferred Securities and Common Securities and
investing the proceeds thereof in an equivalent amount of the Company's Series C
% junior subordinated deferrable interest notes due , 2037
(the "Series C Junior Subordinated Notes").
The Series C Junior Subordinated Notes will be unsecured obligations of the
Company and will be subordinate and junior in right of payment to Senior
Indebtedness of the Company, as described herein. See "Description of the Series
C Junior Subordinated Notes -- Subordination." Holders of the Preferred
Securities are entitled to receive cumulative cash distributions at the rate of
% per annum (the "Securities Rate"), accruing from the date of original
issuance and payable, unless deferred, quarterly in arrears on March 31, June
30, September 30 and December 31 of each year (each, a "Distribution
Date"). (continued on page 2)
---------------------
See "Risk Factors" beginning on page 9 for certain information relevant to
an investment in the Preferred Securities, including the period and
circumstances during and under which payments of distributions on the Preferred
Securities may be deferred and the related United States federal income tax
consequences of such deferral.
---------------------
Application has been made to list the Preferred Securities on the New York
Stock Exchange, Inc. (the "NYSE"). If approved, trading of the Preferred
Securities on the NYSE is expected to commence within a 30-day period after the
initial delivery of the Preferred Securities. See "Underwriting."
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
---------------------
<TABLE>
<CAPTION>
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC(1) DISCOUNT(2)(3) TRUST(2)(3)(4)
--------- -------------- --------------
<S> <C> <C> <C>
Per Preferred Security............
Total.............................
</TABLE>
- ---------------
(1) Plus accrued distributions, if any, from the Issue Date.
(2) The Company and the Trust have agreed to indemnify the Underwriters against
certain liabilities, including liabilities under the Securities Act of
1933, as amended. See "Underwriting."
(3) Because the proceeds of the sale of the Preferred Securities will be
invested in Series C Junior Subordinated Notes, the Company has agreed to
pay to the Underwriters, as compensation (the "Underwriters' Compensation")
for arranging the investment therein of such proceeds, $ per Preferred
Security, except for Preferred Securities sold to certain institutions, for
which the Underwriters' Compensation will be $ per Preferred Security.
Therefore, to the extent that Preferred Securities are sold to such
institutions, the actual amount of Underwriters' Compensation will be less
than and the Proceeds to Trust will be greater than the aggregate amounts
specified above. See "Underwriting."
(4) Expenses of the offering to be paid by the Company are estimated to be
approximately $ .
---------------------
The Preferred Securities are offered severally by the Underwriters, as
specified herein, subject to receipt and acceptance by them and subject to their
right to reject any order in whole or in part. It is expected that delivery of
the Preferred Securities will be made in book-entry only form through the
facilities of The Depository Trust Company on or about , 1997
(the "Issue Date").
GOLDMAN, SACHS & CO.
---------------------
, 1997
<PAGE>
(CONTINUED FROM PAGE 1)
The Securities Rate and the Distribution Dates for the Preferred Securities
will correspond to the interest rate and interest and other payment dates on the
Series C Junior Subordinated Notes, which will constitute substantially all the
assets of the Trust. As a result, if principal or interest is not paid on the
Series C Junior Subordinated Notes, no amounts will be paid on the Preferred
Securities. THE COMPANY HAS THE RIGHT TO DEFER PAYMENTS OF INTEREST ON THE
SERIES C JUNIOR SUBORDINATED NOTES BY EXTENDING THE INTEREST PAYMENT PERIOD ON
THE SERIES C JUNIOR SUBORDINATED NOTES, AT ANY TIME AND FROM TIME TO TIME, FOR
UP TO 20 CONSECUTIVE QUARTERS (EACH, AN "EXTENSION PERIOD"). If interest
payments are so deferred, distributions on the Preferred Securities also will be
deferred and the Company will not be permitted, subject to certain exceptions
described herein, to declare or pay any dividend or distribution on any of its
capital stock or make any guarantee payments with respect to the foregoing, or
make any payment on any debt securities issued by the Company which rank pari
passu with or junior to the Series C Junior Subordinated Notes. During any
Extension Period, holders of Preferred Securities will be required to include
income in the form of original issue discount ("OID") in their gross income for
United States federal income tax purposes in advance of the receipt of the cash
payments attributable to such deferred interest. See "Description of the Series
C Junior Subordinated Notes -- Option to Extend Interest Payment Period," "Risk
Factors -- Option to Extend Interest Payment Period" and "Certain Federal Income
Tax Considerations -- Original Issue Discount" and "-- Market Discount."
Deferred installments of interest on the Series C Junior Subordinated Notes will
bear interest, compounded quarterly, at a rate per annum equal to the Securities
Rate. The payment of such deferred interest, together with interest thereon,
will be distributed to the holders of the Preferred Securities as received at
the end of any Extension Period.
The Trust Securities are subject to mandatory redemption upon repayment of
the Series C Junior Subordinated Notes at maturity or their earlier redemption.
The Series C Junior Subordinated Notes are redeemable at the option of the
Company (in whole or in part), from time to time, on or after ,
2002, or at any time in whole upon the occurrence of a Tax Event or Investment
Company Act Event (either, a "Special Event"). The Company will have the right
at any time to terminate the Trust and cause the Series C Junior Subordinated
Notes to be distributed to the holders of the Preferred Securities in
liquidation of the Trust. See "Description of the Preferred
Securities -- Special Event Redemption or Distribution." The Series C Junior
Subordinated Notes are subordinated and junior in right of payment to all Senior
Indebtedness (as defined herein) of the Company. See "Description of the Series
C Junior Subordinated Notes -- Subordination." As of March 31, 1997, Senior
Indebtedness of the Company aggregated approximately $3,474,000,000. If the
Series C Junior Subordinated Notes are distributed to the holders of the
Preferred Securities, the Company will use its best efforts to have the Series C
Junior Subordinated Notes listed on the NYSE or on such other exchange as the
Preferred Securities are then listed. See "Description of the Preferred
Securities -- Special Event Redemption or Distribution" and "Description of the
Series C Junior Subordinated Notes."
The payment of distributions on the Preferred Securities is guaranteed by
the Company under the Guarantee Agreement, but only to the extent that the Trust
has funds legally and immediately available therefor (the "Guarantee"). If the
Company fails to make required payments on the Series C Junior Subordinated
Notes, the Trust will not have sufficient funds to pay such distributions, and
the Guarantee does not cover the payment of distributions when the Trust does
not have sufficient funds legally available therefor. In such event, the remedy
of a holder of Preferred Securities is to enforce the Series C Junior
Subordinated Notes. See "Description of the Series C Junior Subordinated Notes."
The Company's obligations under the Guarantee are subordinate and junior in
right of payment to all of its other liabilities and will rank pari passu (equal
in priority) with the most senior preferred stock of the Company. See
"Description of the Guarantee." The Company has, through the Guarantee, the
Subordinated Note Indenture, the Series C Junior Subordinated Notes, the Trust
Agreement and the Agreement as to Expenses and Liabilities, fully and
unconditionally guaranteed, subject to certain subordination provisions, all the
Trust's obligations with respect to the Preferred Securities.
In the event of the redemption of the Series C Junior Subordinated Notes or
the voluntary or involuntary dissolution, winding-up or termination of the
Trust, the holders of the Preferred Securities will be entitled to receive, for
each Preferred Security, a liquidation amount of $25 plus accrued and unpaid
distributions thereon (including interest thereon) to the date of payment (the
"Redemption Price"), unless in connection with such dissolution, winding-up or
termination, the Series C Junior Subordinated Notes are distributed to the
holders of the Preferred Securities. See "Description of the Preferred
Securities -- Liquidation Distribution Upon Dissolution."
The Preferred Securities initially will be represented by a global
certificate or certificates registered in the name of The Depository Trust
Company ("DTC") or its nominee. Beneficial interests in the Preferred Securities
will be shown on, and transfers thereof will be effected only through, records
maintained by Participants (as defined herein) in DTC. Except as described
herein, Preferred Securities in certificated form will not be issued in exchange
for the global certificates. See "Description of the Preferred
Securities -- Book-Entry Only Issuance -- The Depository Trust Company."
---------------------------
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE PREFERRED
SECURITIES, INCLUDING BY ENTERING STABILIZING BIDS, PURCHASING PREFERRED
SECURITIES TO COVER SYNDICATE SHORT POSITIONS AND IMPOSING PENALTY BIDS. FOR A
DISCUSSION OF THESE ACTIVITIES, SEE "UNDERWRITING" HEREIN.
2
<PAGE>
AVAILABLE INFORMATION
The Company and the Trust have filed with the Securities and Exchange
Commission (the "Commission") a combined registration statement on Form S-3 (the
"Registration Statement," which term encompasses any amendments thereof and
exhibits thereto) under the Securities Act of 1933, as amended (the "1933 Act").
As permitted by the rules and regulations of the Commission, this Prospectus
does not contain all of the information set forth in the Registration Statement
and the exhibits and schedules thereto, to which reference is hereby made.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "1934 Act"), and in accordance therewith
files reports and other information with the Commission. Such reports and other
information can be inspected and copied at the public reference facilities of
the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
Commission's Regional Offices at 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661 and Seven World Trade Center, 13th Floor, New York, New York
10048. Copies of such material can also be obtained at prescribed rates by
writing to the Public Reference Section of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549. The Commission maintains a Web site that contains
reports, proxy and information statements and other information regarding
registrants including the Company that file electronically at
http://www.sec.gov. In addition, reports and other material concerning the
Company can be inspected at the offices of the New York Stock Exchange, 20 Broad
Street, New York, New York 10005, on which Exchange certain of the Company's
securities are listed.
No separate financial statements of the Trust are included herein. The
Company considers that such statements would not be material to holders of the
Preferred Securities because the Trust has no independent operations and exists
for the sole purpose of investing the proceeds of the sale of the Trust
Securities in Series C Junior Subordinated Notes.
---------------------------
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents have been filed with the Commission pursuant to the
1934 Act and are incorporated herein by reference and made a part of this
Prospectus:
(a) the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1996;
(b) the Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1997; and
(c) the Company's Current Reports on Form 8-K dated January 9, 1997 and
February 12, 1997.
All documents filed by the Company with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the 1934 Act subsequent to the date of this
Prospectus and prior to the termination of this offering shall be deemed to be
incorporated herein by reference and made a part of this Prospectus from the
date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Prospectus to the extent that a
statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of this
Prospectus.
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON TO WHOM THIS
PROSPECTUS IS DELIVERED, ON THE WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON, A
COPY OF ANY OR ALL DOCUMENTS INCORPORATED HEREIN BY REFERENCE (OTHER THAN THE
EXHIBITS TO SUCH DOCUMENTS UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED BY
REFERENCE). SUCH REQUESTS SHOULD BE DIRECTED TO JUDY M. ANDERSON, VICE PRESIDENT
AND CORPORATE SECRETARY, GEORGIA POWER COMPANY, 333 PIEDMONT AVENUE, N.E.,
ATLANTA, GEORGIA 30308, TELEPHONE: (404) 526-6526.
3
<PAGE>
SELECTED INFORMATION
The following material, which is presented herein solely to furnish limited
introductory information regarding the Company and the offering made by this
Prospectus, has been selected from, or is based upon, the detailed information
and financial statements appearing in the documents incorporated herein by
reference or elsewhere in this Prospectus, is qualified in its entirety by
reference thereto and, therefore, should be read together therewith. Capitalized
terms not otherwise defined shall have the meanings assigned in the Glossary.
GEORGIA POWER COMPANY
Business......................... Generation, transmission, distribution and
sale of electric energy
Service Area..................... Approximately 57,200 square miles
comprising most of the State of Georgia
Service Area Population (1990
Census).......................... Approximately 6,200,000
Customers at December 31, 1996... 1,749,609
Generating Capacity at December
31, 1996 (kilowatts)............. 14,367,222
Sources of Generation during 1996
(kilowatt-hours)............... Coal (74%), Nuclear (22%), Hydro (3%), Oil
and Gas (1%)
Sources of Generation Estimated
for 1997 (kilowatt-hours)........ Coal (77%), Nuclear (21%), Hydro (2%), Oil
and Gas (less than 0.5%)
SELECTED FINANCIAL INFORMATION
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 12 MONTHS
--------------------------------------------- ENDED APRIL
1992 1993 1994(1) 1995(1) 1996(1) 30, 1997(1)
---- ---- ------- ------- ------- -----------
(MILLIONS, EXCEPT RATIOS) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Operating Revenues.................. $4,297 $4,451 $4,162 $4,405 $4,417 $4,338
Income Before Interest Charges...... $1,003 $1,033 $925 $957 $873 $855
Net Income After Dividends on
Preferred Stock................... $521 $570 $526 $609 $580 $568
Ratio of Earnings to Fixed
Charges(2)........................ 3.15 3.46 3.65 4.51 4.99 4.90
Ratio of Earnings to Fixed Charges
Plus Preferred Dividend
Requirements (Pre-Income Tax
Basis)(3)......................... 2.59 2.88 2.99 3.60 3.89 3.92
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
CAPITALIZATION AS OF
MARCH 31, 1997
-------------------------------
ACTUAL AS ADJUSTED(4)
------ --------------
(MILLIONS, EXCEPT PERCENTAGES)
<S> <C> <C> <C>
Common Stock Equity......................................... $4,138 $4,138 49.2%
Cumulative Preferred Stock.................................. 380 380 4.5
Company Obligated Mandatorily Redeemable Preferred
Securities of Subsidiaries Holding Company Junior
Subordinated Notes........................................ 500 700 8.3
Long-Term Debt.............................................. 3,201 3,201 38.0
------ ------ -----
Total, excluding amounts due within one year of
$316 million.................................... $8,219 $8,419 100.0%
====== ====== =====
</TABLE>
- ---------------
(1) See "Recent Results of Operations" herein. "Income Before Interest Charges"
and "Net Income After Dividends on Preferred Stock" for the years ended
December 31, 1994, 1995 and 1996 and the twelve months ended April 30, 1997,
reflect charges of approximately $55,000,000, $8,000,000, 29,000,000 and
$17,000,000, respectively, after taxes relating to benefits provided
pursuant to work force reduction programs.
(2) This ratio is computed as follows: (i) "Earnings" have been calculated by
adding to "Income Before Interest Charges" all income taxes deducted
therefrom and the debt portion of allowance for funds used during
construction; and (ii) "Fixed Charges" consist of "Net Interest Charges"
plus the debt portion of allowance for funds used during construction.
(3) In computing this ratio, "Preferred Dividend Requirements" represent the
before tax earnings necessary to pay such dividends, computed at the
effective tax rates for the applicable periods.
(4) Reflects the issuance of the Preferred Securities offered hereby. As
described in this Prospectus, substantially all of the assets of the Trust
will be Series C Junior Subordinated Notes of the Company with an aggregate
principal amount not exceeding $206,186,000, and upon redemption of such
debt, the Preferred Securities will be mandatorily redeemable.
5
<PAGE>
THE OFFERING
The Trust.................. Georgia Power Capital Trust III is a statutory
business trust created under Delaware law solely
for the purpose of holding the Company's Series C
Junior Subordinated Notes and issuing Preferred
Securities and Common Securities evidencing the
entire beneficial interest therein (and engaging
in activities necessary, appropriate, convenient
or incidental thereto).
The Trustees............... The Chase Manhattan Bank will act as property
trustee (the "Property Trustee") of the Trust.
Two officers of the Company also will act as
trustees (the "Administrative Trustees") of the
Trust. Chase Manhattan Bank Delaware will be an
additional trustee (the "Delaware Trustee") of
the Trust. The Chase Manhattan Bank also will act
as trustee (the "Indenture Trustee") under the
Subordinated Note Indenture pursuant to which the
Series C Junior Subordinated Notes will be issued
and will act as trustee under the Guarantee (the
"Guarantee Trustee").
The Property Trustee, Delaware Trustee and
Administrative Trustees are sometimes referred to
as the "Securities Trustees."
Preferred Securities
Offered.................... The Trust will offer 8,000,000 Preferred Securities
evidencing preferred undivided beneficial
interests in the assets of the Trust. Holders of
the Preferred Securities are entitled to receive
cumulative cash distributions at the Securities
Rate, accruing from the date of original issuance
and payable quarterly in arrears on March 31,
June 30, September 30 and December 31 of each
year, commencing on , 1997 (each, a
"Distribution Date"). The Securities Rate and the
Distribution Dates for the Preferred Securities
will correspond to the interest rate and payment
dates on the Series C Junior Subordinated Notes,
which will constitute substantially all the
assets of the Trust. As a result, if principal or
interest is not paid on the Series C Junior
Subordinated Notes, no amounts will be paid on
the Preferred Securities. See "Description of the
Preferred Securities."
Record Date................ The record date for each Distribution Date will be
the close of business on the 15th calendar day
prior to such Distribution Date.
Series C Junior
Subordinated Notes......... The Trust will invest the proceeds from the
issuance of the Preferred Securities and Common
Securities in an equivalent amount of Series C
% junior subordinated deferrable interest
notes due , 2037. The Series C Junior
Subordinated Notes will be subordinate and junior
in right of payment to all indebtedness for
borrowed money and other obligations of the
Company included in the definition of Senior
Indebtedness. See "Description of the Junior
Subordinated Notes -- Subordination."
Guarantee.................. The payment of distributions on the Preferred
Securities is guaranteed by the Company under the
Guarantee, but only to the extent the Trust has
funds legally and immediately available to make
such distributions. If the Company does not make
principal or interest payments on the Series C
Junior Subordinated Notes, the Trust will not
have sufficient funds to make distributions on
the Preferred
6
<PAGE>
Securities, in which event the Guarantee will not
apply to such distributions until the Trust has
sufficient funds legally available therefor. The
obligations of the Company under the Guarantee
will be subordinate and junior in right of
payment to all other liabilities of the Company
and will rank pari passu with the most senior
preferred stock issued by the Company. See "Risk
Factors -- Ranking of and Rights Under the
Guarantee" and "Description of the Guarantee."
The Company has, through the Guarantee, the
Subordinated Note Indenture, the Series C Junior
Subordinated Notes, the Trust Agreement and the
Agreement as to Expenses and Liabilities, fully
and unconditionally guaranteed, subject to
certain subordination provisions, all the Trust's
obligations with respect to the Preferred
Securities.
Interest Deferral.......... The Company has the right to defer payments of
interest on the Series C Junior Subordinated
Notes by extending the interest payment period on
the Series C Junior Subordinated Notes, at any
time and from time to time, for up to 20
consecutive quarters (each, an "Extension
Period"). The only restrictions on the Company's
ability to defer payments of interest are that
during the Extension Period the Company may not
(i) pay dividends on or redeem any of its capital
stock or (ii) pay principal or interest on any
debt securities ranking pari passu with or
subordinate to the Series C Junior Subordinated
Notes. There could be multiple Extension Periods
of varying lengths throughout the term of the
Series C Junior Subordinated Notes.
If interest payments on the Series C Junior
Subordinated Notes are deferred, distributions on
the Preferred Securities will also be deferred.
During an Extension Period, holders of Preferred
Securities will be required to include income in
the form of OID in their gross income for federal
income tax purposes in advance of the receipt of
the cash payments attributable to such deferred
interest. See "Description of the Series C Junior
Subordinated Notes -- Option to Extend Interest
Payment Period" and "Certain Federal Income Tax
Considerations -- Original Issue Discount" and
"-- Market Discount." Deferred interest will bear
interest, compounded quarterly, at a rate per
annum equal to the Securities Rate from the date
of deferral to the date of payment.
Redemption; Distribution... The Preferred Securities are subject to mandatory
redemption upon repayment of the Series C Junior
Subordinated Notes at maturity or their earlier
redemption. The Series C Junior Subordinated
Notes are redeemable by the Company (in whole or
in part), from time to time on or after
, 2002, or at any time in whole upon
the occurrence of a Special Event. If a partial
redemption of the Series C Junior Subordinated
Notes would result in the delisting of the
Preferred Securities, the Company may only redeem
the Series C Junior Subordinated Notes in whole.
Any partial redemption of the Series C Junior
Subordinated Notes will be effected by the
redemption of an equivalent amount of Trust
Securities, to be allocated approximately 97% to
the Preferred Securities and 3% to the Common
Securities. See "Description of the Preferred
Securi-
7
<PAGE>
ties -- Redemption" and "-- Special Event
Redemption or Distribution."
The Company will have the right at any time to
terminate the Trust and cause the Series C Junior
Subordinated Notes to be distributed to the
holders of the Preferred Securities in
liquidation of the Trust. This right is optional
and wholly within the discretion of the Company.
Circumstances under which the Company may
determine to exercise such right could include
the occurrence of an Investment Company Act Event
or a Tax Event, adverse tax consequences to the
Company or the Trust that are not within the
definition of a Tax Event because they do not
result from an amendment or change described in
such definition, and changes in the accounting
requirements applicable to the Preferred
Securities as described under "Accounting
Treatment." See "Description of the Preferred
Securities -- Special Event Redemption or
Distribution."
Special Event.............. A Special Event means a Tax Event or an Investment
Company Act Event. A "Tax Event" means that the
Administrative Trustees and the Company shall
have received an opinion from independent tax
counsel experienced in such matters (which may be
counsel to the Company) to the effect that, as a
result of (a) any amendment to, or change
(including any announced prospective change) in,
the laws (or any regulations thereunder) of the
United States or any political subdivision or
taxing authority thereof or therein or (b) any
amendment to, or change in, an interpretation or
application of such laws or regulations, there is
more than an insubstantial risk that (i) the
Trust would be subject to United States federal
income tax with respect to income accrued or
received on the Series C Junior Subordinated
Notes, (ii) interest payable to the Trust on the
Series C Junior Subordinated Notes would not be
deductible by the Company for United States
federal income tax purposes, or (iii) the Trust
would be subject to more than a de minimis amount
of other taxes, duties or other governmental
charges, which change or amendment becomes
effective on or after the Issue Date. An
"Investment Company Act Event" means that the
Administrative Trustees and the Company shall
have received an opinion of independent counsel
(which may be counsel to the Company) to the
effect that, as a result of a change in law or
regulation or a written change in interpretation
or application of law or regulation by any
legislative body, court, governmental agency or
regulatory authority after the Issue Date, there
is more than an insubstantial risk that the Trust
is or will be considered an investment company
under the Investment Company Act of 1940, as
amended (the "1940 Act").
Redemption Price........... In the event of the redemption of the Trust
Securities or other termination of the Trust
without distribution of the Series C Junior
Subordinated Notes, each Preferred Security shall
be entitled to receive a liquidation amount of
$25 plus accrued and unpaid distributions thereon
(including interest thereon) to the date of
payment.
8
<PAGE>
RISK FACTORS
Prospective purchasers of Preferred Securities should carefully review the
information contained elsewhere in this Prospectus and should consider
particularly the following matters:
RANKING OF AND RIGHTS UNDER THE SERIES C JUNIOR SUBORDINATED NOTES
No amounts will be available to make payments on the Preferred Securities
except from payments made on the Series C Junior Subordinated Notes. The
obligations of the Company under the Series C Junior Subordinated Notes are
subordinate and junior in right of payment to all present and future Senior
Indebtedness of the Company. At March 31, 1997, Senior Indebtedness of the
Company aggregated approximately $3,474,000,000. There are no terms in the
Preferred Securities, the Series C Junior Subordinated Notes or the Guarantee
that limit the Company's ability to incur additional indebtedness, including
indebtedness that ranks senior to the Series C Junior Subordinated Notes. See
"Description of the Guarantee" and "Description of the Series C Junior
Subordinated Notes -- Subordination."
RANKING OF AND RIGHTS UNDER THE GUARANTEE
The Company's obligations under the Guarantee are subordinate and junior in
right of payment to all liabilities of the Company and will be pari passu with
the most senior preferred stock issued by the Company. If the Company were to
default in its obligation to pay amounts payable on the Series C Junior
Subordinated Notes, the Trust would lack available funds for the payment of
distributions or amounts payable on redemption of the Preferred Securities or
otherwise, and in such event holders of the Preferred Securities would not be
able to rely upon the Guarantee for payment of such amounts.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
The Company has the right under the Subordinated Note Indenture, and at any
time, and from time to time, to defer payments of interest on the Series C
Junior Subordinated Notes for a period of up to 20 consecutive quarters (each,
an "Extension Period"), but not beyond the stated maturity of the Series C
Junior Subordinated Notes. Prior to the termination of any Extension Period, the
Company may further defer payments of interest, provided that such Extension
Period, together with all such previous and further extensions thereof, may not
exceed 20 consecutive quarters. Upon the termination of any Extension Period and
the payment of all amounts then due, the Company may select a new Extension
Period, subject to the above requirements. There could be multiple Extension
Periods of varying lengths throughout the term of the Series C Junior
Subordinated Notes. Deferred installments of interest on the Series C Junior
Subordinated Notes will bear interest, compounded quarterly, at a rate per annum
equal to the Securities Rate. The payment of such deferred interest, together
with interest thereon, will be passed through to the holders of the Preferred
Securities as received at the end of any Extension Period.
The only restrictions on the Company's ability to defer payments of
interest are that during any Extension Period the Company may not (i) pay
dividends on or redeem any of its capital stock or (ii) pay principal or
interest on any debt securities ranking pari passu with or subordinate to the
Series C Junior Subordinated Notes. See "Description of the Preferred
Securities -- Distributions" and "Description of the Series C Junior
Subordinated Notes -- Option to Extend Interest Payment Period."
Should the Company exercise its rights to defer payments of interest, each
holder of Preferred Securities will be required to include income in the form of
OID in its gross income for United States federal income tax purposes in respect
of the deferred interest allocable to its Preferred Securities. As a result,
holders of Preferred Securities will recognize income for United States federal
income tax purposes in advance of the receipt of cash and will not receive the
cash from the Trust related to such income if such holders dispose of their
Preferred Securities prior to the record date for the date on which
distributions of such amounts are made. See "Certain Federal Income Tax
Considerations -- Original Issue Discount" and "-- Sale of Preferred
Securities." INVESTORS SHOULD CONSULT WITH THEIR OWN TAX ADVISORS WITH RESPECT
TO THE TAX CONSEQUENCES OF AN INVESTMENT IN THE PREFERRED SECURITIES.
9
<PAGE>
The Company has no current intention of exercising its right to defer
payments of interest by extending the interest payment period on the Series C
Junior Subordinated Notes. However, should the Company determine to exercise
such right in the future, the market price of the Preferred Securities is likely
to be affected. A holder that disposes of its Preferred Securities during an
Extension Period, therefore, might not receive the same return on its investment
as a holder that continues to hold its Preferred Securities. In addition, as a
result of the existence of the Company's right to defer interest payments, the
market price of the Preferred Securities (which represent an undivided
beneficial interest in the Series C Junior Subordinated Notes) may be more
volatile than other similar securities that do not have such rights.
SPECIAL EVENT REDEMPTION OR DISTRIBUTION
If a Special Event shall occur and be continuing, the Company will have the
option to redeem the Series C Junior Subordinated Notes in cash (with the result
that the Preferred Securities shall be redeemed). In addition, the Company will
have the right at any time to terminate the Trust and cause the Series C Junior
Subordinated Notes to be distributed to the holders of the Preferred Securities
in liquidation of the Trust. See "Description of the Preferred
Securities -- Special Event Redemption or Distribution."
There can be no assurance as to the market price for the Series C Junior
Subordinated Notes that may be distributed in exchange for Preferred Securities
if a termination or liquidation of the Trust were to occur. Accordingly, the
Series C Junior Subordinated Notes that the investor may receive on termination
and liquidation of the Trust may trade at a discount to the price that the
investor paid to purchase the Preferred Securities offered hereby. See
"Description of the Series C Junior Subordinated Notes."
POSSIBLE TAX LAW CHANGES
On February 6, 1997, the revenue portion of President Clinton's fiscal 1998
budget proposal (the "Proposal") was released. The Proposal would, among other
things, generally deny interest deductions for interest on an instrument issued
by a corporation that has a maximum term of more than 15 years and that is not
shown as indebtedness on the separate balance sheet of the issuer. If the
Proposal were to apply to the Series C Junior Subordinated Notes, the Company
would be unable to deduct interest on the Series C Junior Subordinated Notes. As
currently drafted, however, the Proposal would be effective generally for
instruments issued on or after the date of first Congressional committee action
and, as such, is not expected to apply to the Series C Junior Subordinated
Notes. The Company believes that, under current law, it will be able to deduct
interest on the Series C Junior Subordinated Notes. There can be no assurance,
however, that current or future legislative proposals or final legislation will
not affect the ability of the Company to deduct interest on the Series C Junior
Subordinated Notes. Such a change could give rise to a Tax Event, which would
permit the Company to cause a redemption of the Preferred Securities, as
described more fully under "Description of the Preferred Securities -- Special
Event Redemption or Distribution."
LIMITED VOTING RIGHTS
Holders of Preferred Securities will have limited voting rights and, except
for the rights of holders of Preferred Securities to appoint a Substitute
Property Trustee upon the occurrence of certain events described herein, will
not be entitled to vote to appoint, remove or replace the Securities Trustees,
which voting rights are vested exclusively in the holder of the Common
Securities.
TRADING CHARACTERISTICS OF PREFERRED SECURITIES
The Preferred Securities are expected to be listed on the NYSE, subject to
official notice of issuance. The Preferred Securities are expected to trade at a
price that takes into account the value, if any, of accrued but unpaid
distributions; thus, purchasers will not pay and sellers will not receive
accrued and unpaid interest with respect to the Preferred Securities that is not
included in the trading price thereof. If a
10
<PAGE>
Preferred Security is disposed of prior to the occurrence of an Extension
Period, any portion of the amount received that is attributable to accrued
interest will be treated as interest income to a U.S. holder for tax purposes
and will not be treated as part of the amount realized for purposes of
determining gain or loss on the disposition of the Preferred Security. If an
Extension Period occurs, interest on the Series C Junior Subordinated Notes will
be included in the gross income of U.S. holders of Preferred Securities as it
accrues rather than when it is paid. Should an Extension Period occur, a holder
who disposes of his Preferred Securities between record dates for payments of
distributions thereon would be required to include accrued but unpaid interest
on the Series C Junior Subordinated Notes through the date of disposition in
income as OID, and to add such amount to his adjusted tax basis in his pro rata
share of the related Series C Junior Subordinated Notes deemed disposed of. To
the extent the selling price is less than the holder's adjusted tax basis, a
holder generally will recognize a capital loss. Subject to certain limited
exceptions, capital losses cannot be applied to offset ordinary income for
United States federal income tax purposes. See "Certain Federal Income Tax
Considerations -- Original Issue Discount" and "-- Sale of Preferred
Securities."
The trading price of the Preferred Securities is likely to be sensitive to
the level of interest rates generally. If interest rates rise in general, the
trading price of the Preferred Securities may decline to reflect the additional
yield requirements of the purchasers. Conversely, a decline in interest rates
may increase the trading price of the Preferred Securities, although any
increase will be moderated by the Company's ability to call the Series C Junior
Subordinated Notes at any time on or after , 2002 at a redemption
price equal to 100% of the principal amount to be redeemed plus accrued but
unpaid interest. In addition, because holders of Preferred Securities will be
paid only from payments on the Series C Junior Subordinated Notes and may
receive Series C Junior Subordinated Notes upon the termination of the Trust,
prospective purchasers of Preferred Securities are making an investment decision
with regard to the Series C Junior Subordinated Notes and should carefully
review all the information regarding the Series C Junior Subordinated Notes
contained herein. See "Description of the Preferred Securities -- Special Event
Redemption or Distribution" and "Description of the Series C Junior Subordinated
Notes."
GEORGIA POWER COMPANY
The Company is a wholly-owned subsidiary of The Southern Company, a holding
company registered under the Public Utility Holding Company Act of 1935, as
amended. The Company was incorporated under the laws of the State of Georgia on
June 26, 1930. It is engaged in the generation and purchase of electric energy
and the transmission, distribution and sale of such energy within the State of
Georgia at retail in over 600 communities (including Athens, Atlanta, Augusta,
Columbus, Macon, Rome and Valdosta), as well as in rural areas, and at wholesale
currently to 39 electric cooperative associations through Oglethorpe Power
Corporation, a corporate cooperative of electric membership corporations in
Georgia, and to 50 municipalities, 48 of which are served through the Municipal
Electric Authority of Georgia, a public corporation and an instrumentality of
the State of Georgia. The Company and one of its affiliates, Alabama Power
Company, each owns 50% of the common stock of Southern Electric Generating
Company ("SEGCO"). SEGCO owns electric generating units near Wilsonville,
Alabama. The principal executive offices of the Company are located at 333
Piedmont Avenue, N.E., Atlanta, Georgia 30308, and the telephone number is (404)
526-6526.
GEORGIA POWER CAPITAL TRUST III
The Trust is a statutory business trust created under Delaware law pursuant
to the filing of a certificate of trust with the Delaware Secretary of State on
June 13, 1996. The Trust's business is defined in a trust agreement, executed by
the Company, as Depositor, and the Delaware Trustee thereunder. This trust
agreement will be amended and restated in its entirety on the Issue Date
substantially in the form filed as an exhibit to the Registration Statement of
which this Prospectus forms a part (the "Trust Agreement"). The Trust Agreement
will be qualified as an indenture under the Trust Indenture Act of
11
<PAGE>
1939, as amended (the "1939 Act"). The Trust exists for the exclusive purposes
of (i) issuing the Trust Securities representing undivided beneficial interests
in the assets of the Trust, (ii) investing the gross proceeds of the Trust
Securities in the Series C Junior Subordinated Notes, and (iii) engaging in only
those other activities necessary, appropriate, convenient or incidental thereto.
The Trust has a term of approximately 45 years from its creation, but may
terminate earlier as provided in the Trust Agreement.
Upon issuance of the Preferred Securities, the purchasers thereof will own
all of the Preferred Securities. The Company will acquire all of the Common
Securities, which will have an aggregate liquidation amount equal to
approximately 3% of the total capital of the Trust. The Common Securities will
rank pari passu, and payments will be made thereon pro rata, with the Preferred
Securities, except that upon the occurrence and continuance of a Subordinated
Note Indenture Event of Default, the rights of the holders of Common Securities
to payment in respect of distributions and payments upon liquidation, redemption
and otherwise will be subordinated to the rights of the holders of the Preferred
Securities.
The Trust's business and affairs will be conducted by the Securities
Trustees, which shall be appointed by the Company as the holder of the Common
Securities. Two officers of the Company initially will serve as Administrative
Trustees. The Chase Manhattan Bank will serve as Property Trustee and will hold
legal title to the Series C Junior Subordinated Notes issued by the Company on
behalf of the Trust and the holders of the Trust Securities. Chase Manhattan
Bank Delaware will serve as Delaware Trustee. In certain circumstances, the
holders of a majority in liquidation amount of the Preferred Securities will be
entitled to appoint a Substitute Property Trustee. See "Description of the
Preferred Securities -- Voting Rights."
The Property Trustee will hold legal title to the Series C Junior
Subordinated Notes for the benefit of the Trust and the holders of the Trust
Securities and will have the power to exercise all rights, powers and privileges
under the Subordinated Note Indenture as the holder of the Series C Junior
Subordinated Notes. The Property Trustee will make payments of distributions and
payments on liquidation, redemption and otherwise to the holders of the Trust
Securities. Subject to the right of the holders of the Preferred Securities to
appoint a Substitute Property Trustee in certain instances, the Company, as the
holder of all the Common Securities, will have the right to appoint, remove or
replace all the Securities Trustees.
The Series C Junior Subordinated Notes will constitute substantially all of
the assets of the Trust. Other assets that may constitute "Trust Property" (as
that term is defined in the Trust Agreement) include any cash on deposit in, or
owing to, the payment account as established under the Trust Agreement, as well
as any other property or assets held by the Property Trustee pursuant to the
Trust Agreement. In addition, the Trust may, from time to time, receive cash
pursuant to the Agreement as to Expenses and Liabilities.
The rights of the holders of the Preferred Securities, including economic
rights, rights to information and voting rights, are as set forth in the Trust
Agreement, the Delaware Business Trust Act, and the 1939 Act. See "Description
of the Preferred Securities."
The Trust's registered office in the State of Delaware is c/o Chase
Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801. The
principal place of business of the Trust shall be c/o the Company, 333 Piedmont
Avenue, N.E., Atlanta, Georgia 30308, telephone (404) 526-6526, Attn: Corporate
Secretary.
ACCOUNTING TREATMENT
For financial reporting purposes, the Trust will be treated as a subsidiary
of the Company and, accordingly, the accounts of the Trust will be included in
the consolidated financial statements of the Company. The Preferred Securities
will be presented as a separate line item in the consolidated balance sheet of
the Company, and appropriate disclosures concerning the Preferred Securities,
the Guarantee and the Series C Junior Subordinated Notes will be included in the
notes to the consolidated financial statements. For financial reporting
purposes, the Company will record distributions payable on the Preferred
Securities as an expense.
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<PAGE>
USE OF PROCEEDS
The Trust will invest the proceeds received from the sale of the Preferred
Securities in Series C Junior Subordinated Notes. The net proceeds received by
the Company from such investment (estimated to be approximately $ )
will be used to repay a portion of its outstanding short-term debt which
aggregated approximately $ as of , 1997. The outstanding
short-term debt of the Company was incurred for working capital purposes and
currently consists of uncommitted bank loans and commercial paper evidenced by
notes having maturities from to days and bearing interest at
rates ranging from % to %.
RECENT RESULTS OF OPERATIONS
For the twelve months ended April 30, 1997, "Operating Revenues", "Income
Before Interest Charges", and "Net Income After Dividends on Preferred Stock"
were $4,338,000,000, $855,000,000 and $568,000,000, respectively. In the opinion
of the management of the Company, the above amounts for the twelve months ended
April 30, 1997 reflect all adjustments (which were only normal recurring
adjustments) necessary to present fairly the results of operations for such
period, subject to the effect of such adjustments, if any, as might have been
required had the outcome of the uncertainty with respect to the actions of the
regulators regarding the recoverability of the Company's investment in the Rocky
Mountain hydroelectric project been known. The "Ratio of Earnings to Fixed
Charges" and the "Ratio of Earnings to Fixed Charges Plus Preferred Dividend
Requirements (Pre-Income Tax Basis)" for the twelve months ended April 30, 1997
were 4.90 and 3.92, respectively.
For information regarding the uncertainty referred to in the preceding
paragraph, reference is made to "Item 1 -- Business -- Construction Programs" in
the Company's Annual Report on Form 10-K for the year ended December 31, 1996,
incorporated herein by reference.
DESCRIPTION OF THE PREFERRED SECURITIES
The Preferred Securities will be issued pursuant to the terms of the Trust
Agreement. The Trust Agreement will be qualified as an indenture under the 1939
Act. The Property Trustee will act as the indenture trustee with respect to the
Trust, as well as the Guarantee, for purposes of compliance with the provisions
of the 1939 Act. The terms of the Preferred Securities will include those stated
in the Trust Agreement, the Delaware Business Trust Act, and those made part of
the Trust Agreement by the 1939 Act. The following summary of the principal
terms and provisions of the Preferred Securities does not purport to be complete
and is subject to, and qualified in its entirety by reference to, the Trust
Agreement, the form of which is filed as an exhibit to the Registration
Statement of which this Prospectus is a part, as well as the 1939 Act.
GENERAL
The Trust Agreement authorizes the Administrative Trustees, on behalf of
the Trust, to issue the Preferred Securities, which represent preferred
undivided beneficial interests in the assets of the Trust, and the Common
Securities, which represent common undivided beneficial interests in the assets
of the Trust. All of the Common Securities will be owned by the Company. The
Common Securities rank pari passu, and payments will be made thereon on a pro
rata basis, with the Preferred Securities, except that upon the occurrence of a
Subordinated Note Indenture Event of Default, the rights of the holders of the
Common Securities to receive payment of periodic distributions and payments upon
liquidation, redemption and otherwise will be subordinated to the rights of the
holders of the Preferred Securities. The Trust Agreement does not permit the
issuance by the Trust of any securities other than the Trust Securities or the
incurrence of any indebtedness by the Trust. Pursuant to the Trust Agreement,
the Property Trustee will own and hold the Series C Junior Subordinated Notes
for the benefit of the Trust and the holders of the Trust Securities. The
payment of distributions out of money held by the Trust, and payments upon
redemption of the Preferred Securities or liquidation of the Trust, are
guaranteed by the
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<PAGE>
Company on a subordinated basis as and to the extent described under
"Description of the Guarantee." The Guarantee does not cover payment of
distributions on the Preferred Securities when the Trust does not have legally
and immediately available funds sufficient to make such distributions. In such
event, the remedy of a holder of Preferred Securities is to direct the Property
Trustee to enforce its rights under the Series C Junior Subordinated Notes. In
addition, a holder of Preferred Securities may institute a legal proceeding
directly against the Company, without first instituting a legal proceeding
against the Property Trustee or any other person or entity, for enforcement of
payment to such holder of principal of or interest on the Series C Junior
Subordinated Notes having a principal amount equal to the aggregate stated
liquidation amount of the Preferred Securities of such holder on or after the
due dates specified in the Series C Junior Subordinated Notes. The above
mechanisms and obligations, together with the Company's obligations under the
Agreement as to Expenses and Liabilities, constitute a full and unconditional
guarantee by the Company of payments due on the Preferred Securities. See
"-- Voting Rights" below.
DISTRIBUTIONS
Distributions on the Preferred Securities will be fixed at the Securities
Rate and will accrue from the Issue Date and, except in the event of an
Extension Period, will be payable quarterly in arrears on March 31, June 30,
September 30 and December 31 of each year. In the event that any date on which
distributions are to be made on the Preferred Securities is not a Business Day,
then payment of the distributions payable on such date will be made on the next
succeeding day that is a Business Day (and without any interest or other payment
in respect of any such delay) 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 such date. A "Business Day" shall mean any day other than a Saturday or
Sunday, a day on which banks in New York City are authorized or obligated by law
or executive order to remain closed or a day on which the principal corporate
trust office of the Property Trustee or the Indenture Trustee is closed for
business.
Distributions payable on any Distribution Date will be payable to the
holders of record on the Record Date for such Distribution Date, which is the
close of business on the fifteenth calendar day preceding such Distribution
Date. Subject to any applicable laws and regulations and the provisions of the
Trust Agreement, each such payment will be made as described under
"-- Book-Entry Only Issuance -- The Depository Trust Company" below. The amount
of distributions payable for any period will be computed on the basis of a
360-day year of twelve 30-day months.
The Company has the right under the Subordinated Note Indenture to defer
payments of interest on the Series C Junior Subordinated Notes by extending the
interest payment period from time to time on the Series C Junior Subordinated
Notes (each, an "Extension Period") which, if exercised, would defer quarterly
distributions on the Preferred Securities during any such extended interest
payment period. Deferred installments of interest on the Series C Junior
Subordinated Notes will bear interest, compounded quarterly, at a rate per annum
equal to the Securities Rate. If distributions are deferred, the deferred
distributions and accrued interest thereon shall be paid, if funds are legally
available therefor, to holders of record of the Preferred Securities as they
appear on the books and records of the Trust on the Record Date next following
the termination of such Extension Period. See "Description of the Series C
Junior Subordinated Notes -- Interest" and "-- Option to Extend Interest Payment
Period."
Distributions on the Preferred Securities must be paid on the Distribution
Dates to the extent that the Trust has funds legally and immediately available
for the payment of such distributions. The Trust's funds available for
distribution to the holders of the Preferred Securities will be limited to
payments received under the Series C Junior Subordinated Notes. See "Description
of the Series C Junior Subordinated Notes."
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<PAGE>
REDEMPTION
The Preferred Securities are subject to mandatory redemption upon repayment
of the Series C Junior Subordinated Notes at maturity or their earlier
redemption. The Series C Junior Subordinated Notes will mature on
, 2037 and may be redeemed, in whole or in part, at the option
of the Company, at any time on or after , 2002 or at any time in
whole upon the occurrence of a Special Event. Upon the repayment of the Series C
Junior Subordinated Notes, whether at maturity or upon redemption, the proceeds
from such repayment or payment shall simultaneously be applied to redeem a like
amount of Trust Securities upon not less than 30 nor more than 60 days' notice,
at the Redemption Price (as defined below). See "Description of the Series C
Junior Subordinated Notes -- Optional Redemption." If a partial redemption of
the Series C Junior Subordinated Notes would result in the delisting of the
Preferred Securities, the Company may only redeem the Series C Junior
Subordinated Notes in whole. In the event that fewer than all of the outstanding
Trust Securities are to be redeemed, the Preferred Securities to be redeemed
will be selected as described under "-- Book-Entry Only Issuance -- The
Depository Trust Company" below. If the Preferred Securities are no longer in
book-entry only form, the Preferred Securities to be redeemed will be selected
by such method as the Property Trustee shall deem fair and appropriate and which
may provide for the selection for redemption of portions (equal to $25 or
integral multiples thereof) of the aggregate liquidation amount of Preferred
Securities of a denomination larger than $25; provided, however, that before
undertaking the redemption of the Preferred Securities on other than a pro rata
basis, the Property Trustee shall have received an opinion of counsel that the
status of the Trust as a grantor trust for federal income tax purposes would not
be adversely affected.
The Redemption Price for each Preferred Security shall equal the stated
liquidation amount of $25 plus accrued and unpaid distributions thereon to the
date of payment.
SPECIAL EVENT REDEMPTION OR DISTRIBUTION
Upon the occurrence of a Special Event at any time, the Company will have
the option to redeem the Series C Junior Subordinated Notes in whole (and thus
cause the redemption of the Preferred Securities in whole). A Special Event is
either an Investment Company Act Event or a Tax Event.
An "Investment Company Act Event" means that the Administrative Trustees
and the Company shall have received an opinion of independent counsel (which may
be counsel to the Company) to the effect that, as a result of a change in law or
regulation or a written change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority after the Issue Date, there is more than an insubstantial risk that
the Trust is or will be considered an investment company under the 1940 Act.
"Tax Event" means that the Administrative Trustees and the Company shall
have received an opinion from independent tax counsel experienced in such
matters (which may be counsel to the Company) to the effect that, as a result of
(a) any amendment to, or change (including any announced prospective change) in,
the laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein or (b) any amendment to, or
change in, an interpretation or application of such laws or regulations, there
is more than an insubstantial risk that (i) the Trust would be subject to United
States federal income tax with respect to income accrued or received on the
Series C Junior Subordinated Notes, (ii) interest payable to the Trust on the
Series C Junior Subordinated Notes would not be deductible by the Company for
United States federal income tax purposes or (iii) the Trust would be subject to
more than a de minimis amount of other taxes, duties or other governmental
charges, which change or amendment becomes effective on or after the Issue Date.
See "Risk Factors -- Possible Tax Law Changes."
The Company will have the right at any time to terminate the Trust and,
after satisfaction of liabilities to creditors of the Trust, if any, cause the
Series C Junior Subordinated Notes to be distributed to the holders of the
Preferred Securities in liquidation of the Trust. See "-- Liquidation
Distribution Upon Dissolution" below. This right is optional and wholly within
the discretion of the Company. Circumstances
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<PAGE>
under which the Company may determine to exercise such right could include the
occurrence of an Investment Company Act Event or a Tax Event, adverse tax
consequences to the Company or the Trust that are not within the definition of a
Tax Event because they do not result from an amendment or change described in
such definition, and changes in the accounting requirements applicable to the
Preferred Securities as described under "Accounting Treatment."
If Series C Junior Subordinated Notes are distributed to the holders of the
Preferred Securities, the Company will use its best efforts to have the Series C
Junior Subordinated Notes listed on the NYSE or on such other exchange as the
Preferred Securities are then listed. After the date for any distribution of
Series C Junior Subordinated Notes upon termination of the Trust, (i) the
Preferred Securities and the Guarantee will no longer be deemed to be
outstanding, (ii) the depositary or its nominee, as the record holder of the
Preferred Securities, will receive a registered global certificate or
certificates representing the Series C Junior Subordinated Notes to be delivered
upon such distribution and (iii) any certificates representing Preferred
Securities and the Guarantee not held by the depositary or its nominee will be
deemed to represent Series C Junior Subordinated Notes having an aggregate
principal amount equal to the aggregate stated liquidation amount of, with an
interest rate identical to the Securities Rate of, and accrued and unpaid
interest equal to accrued and unpaid distributions on, such Preferred
Securities, until such certificates are presented to the Company or its agent
for transfer or reissuance.
There can be no assurance as to the market prices for the Preferred
Securities or the Series C Junior Subordinated Notes that may be distributed in
exchange for the Preferred Securities if a termination and liquidation of the
Trust were to occur. Accordingly, the Preferred Securities that an investor may
purchase, or the Series C Junior Subordinated Notes that the investor may
receive on termination and liquidation of the Trust, may trade at a discount to
the price that the investor paid to purchase the Preferred Securities offered
hereby.
REDEMPTION PROCEDURES
In the event that fewer than all of the Trust Securities are to be
redeemed, then the aggregate liquidation amount of the Trust Securities to be
redeemed shall be allocated 97% to the Preferred Securities and 3% to the Common
Securities.
The Preferred Securities redeemed on each redemption date shall be redeemed
at the Redemption Price with the proceeds from the contemporaneous redemption of
the Series C Junior Subordinated Notes. The Redemption Price of Preferred
Securities shall be deemed payable on each redemption date only to the extent
that the Trust has funds legally and immediately available for payment of such
Redemption Price.
If the Property Trustee gives a notice of redemption in respect of
Preferred Securities (which notice will be irrevocable), then, by 2:00 P.M., New
York City time, on the redemption date, subject to the immediately preceding
paragraph, the Property Trustee will irrevocably deposit with the securities
depositary, so long as the Preferred Securities are in book-entry only form,
sufficient funds to pay the applicable Redemption Price. See "-- Book-Entry Only
Issuance -- The Depository Trust Company" below. If the Preferred Securities are
no longer in book-entry only form, the Property Trustee, subject to the
immediately preceding paragraph, shall irrevocably deposit with the Paying Agent
funds sufficient to pay the applicable Redemption Price and will give the Paying
Agent irrevocable instructions to pay the Redemption Price to the holders
thereof upon surrender of their Preferred Securities certificates. If notice of
redemption shall have been given and funds deposited as required, then
immediately prior to the close of business on the date of such deposit,
distributions will cease to accrue and all rights of holders of such Preferred
Securities so called for redemption will cease, except the right of the holders
of such Preferred Securities to receive the Redemption Price, but without
interest on such Redemption Price. In the event that any date fixed for
redemption of Preferred Securities is not a Business Day, then payment of the
Redemption Price payable on such date will be made on the next succeeding day
which is a Business Day (and without any interest or other payment in respect of
any such delay), except that, if such Business Day falls in the next calendar
year, such payment will be made on the immediately preceding
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Business Day. In the event that payment of the Redemption Price in respect of
Preferred Securities is improperly withheld or refused and not paid either by
the Trust or by the Company pursuant to the Guarantee, distributions on such
Preferred Securities will continue to accrue at the then applicable rate, from
such redemption date originally established by the Trust for such Preferred
Securities to the date such Redemption Price is actually paid. See "-- Events of
Default" below, "Relationship Among the Preferred Securities, the Series C
Junior Subordinated Notes and the Guarantee" and "Description of the
Guarantee -- Events of Default."
Subject to the foregoing and to applicable law (including, without
limitation, United States federal securities laws), the Company or its
affiliates may, at any time and from time to time, purchase outstanding
Preferred Securities by tender, in the open market or by private agreement.
BOOK-ENTRY ONLY ISSUANCE -- THE DEPOSITORY TRUST COMPANY
The Depository Trust Company ("DTC") will act as the initial securities
depositary for the Preferred Securities. The Preferred Securities will be issued
only as fully registered securities registered in the name of Cede & Co., DTC's
nominee. One or more fully registered global Preferred Securities certificates
will be issued, representing in the aggregate the total number of Preferred
Securities, and will be deposited with DTC.
DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the 1934 Act. DTC holds
securities that its participants ("Participants") deposit with DTC. DTC also
facilitates the settlement among Participants of securities transactions, such
as transfers and pledges, in deposited securities through electronic
computerized book-entry changes in Participants' accounts, thereby eliminating
the need for physical movement of securities certificates. Direct Participants
include securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations ("Direct Participants"). DTC is
owned by a number of its Direct Participants and by the NYSE, the American Stock
Exchange, Inc., and the National Association of Securities Dealers, Inc. Access
to the DTC system is also available to others such as securities brokers and
dealers, banks and trust companies that clear through or maintain a custodial
relationship with a Direct Participant, either directly or indirectly ("Indirect
Participants"). The rules applicable to DTC and its Participants are on file
with the Commission.
Purchases of Preferred Securities within the DTC system must be made by or
through Direct Participants, which will receive a credit for the Preferred
Securities on DTC's records. The ownership interest of each actual purchaser of
Preferred Securities ("Beneficial Owner") is in turn to be recorded on the
Direct and Indirect Participants' records. Beneficial Owners will not receive
written confirmation from DTC of their purchases, but Beneficial Owners are
expected to receive written confirmations providing details of the transactions,
as well as periodic statements of their holdings, from the Direct or Indirect
Participants through which the Beneficial Owners purchased Preferred Securities.
Transfers of ownership interests in the Preferred Securities are to be
accomplished by entries made on the books of Participants acting on behalf of
Beneficial Owners. Beneficial Owners will not receive certificates representing
their ownership interests in Preferred Securities, except in the event that use
of the book-entry system for the Preferred Securities is discontinued.
DTC has no knowledge of the actual Beneficial Owners of the Preferred
Securities. DTC's records reflect only the identity of the Direct Participants
to whose accounts such Preferred Securities are credited, which may or may not
be the Beneficial Owners. The Participants will remain responsible for keeping
account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time.
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Redemption notices shall be sent to DTC. If less than all of the Preferred
Securities are being redeemed, DTC will reduce the amount of the interest of
each Direct Participant in the Preferred Securities in accordance with its
procedures.
Although voting with respect to the Preferred Securities is limited, in
those cases where a vote is required, neither DTC nor Cede & Co. will itself
consent or vote with respect to Preferred Securities. Under its usual
procedures, DTC would mail an Omnibus Proxy to the Trust as soon as possible
after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or
voting rights to those Direct Participants to whose accounts the Preferred
Securities are credited on the record date (identified in a listing attached to
the Omnibus Proxy).
Distribution payments on the Preferred Securities will be made to DTC.
DTC's practice is to credit Direct Participants' accounts on the relevant
payment date in accordance with their respective holdings shown on DTC's records
unless DTC has reason to believe that it will not receive payments on such
payment date. Payments by Participants to Beneficial Owners will be governed by
standing instructions and customary practices, as is the case with securities
held for the account of customers registered in "street name," and will be the
responsibility of such Participant and not of DTC, the Trust, any trustee or the
Company, subject to any statutory or regulatory requirements as may be in effect
from time to time. Payment of distributions to DTC is the responsibility of the
Trust, disbursement of such payments to Direct Participants is the
responsibility of DTC, and disbursement of such payments to the Beneficial
Owners is the responsibility of Direct and Indirect Participants.
Except as provided herein, a Beneficial Owner in a global Preferred
Security will not be entitled to receive physical delivery of Preferred
Securities. Accordingly, each Beneficial Owner must rely on the procedures of
DTC to exercise any rights under the Preferred Securities. The laws of some
jurisdictions require that certain purchasers of securities take physical
delivery of securities in definitive form. Such laws may impair the ability to
transfer beneficial interests in a global Preferred Security.
DTC may discontinue providing its services as securities depositary with
respect to the Preferred Securities at any time by giving reasonable notice to
the Trust. Under such circumstances, in the event that a successor securities
depositary is not obtained, Preferred Securities certificates will be printed
and delivered to the holders of record. Additionally, the Company may decide to
discontinue use of the system of book-entry transfers through DTC (or a
successor depositary) with respect to the Preferred Securities. In that event,
certificates for the Preferred Securities will be printed and delivered to the
holders of record.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from sources that the Company and the Trust believe to be
reliable, but the Company and the Trust take no responsibility for the accuracy
thereof. The Trust has no responsibility for the performance by DTC or its
Participants of their respective obligations as described herein or under the
rules and procedures governing their respective operations.
LIQUIDATION DISTRIBUTION UPON DISSOLUTION
Pursuant to the Trust Agreement, the Trust shall terminate on December 31,
2041, or earlier upon (i) the occurrence of a Bankruptcy Event (as defined in
the Trust Agreement) in respect of the Company, dissolution or liquidation of
the Company, or dissolution of the Trust pursuant to a judicial decree; (ii) the
delivery of written direction to the Property Trustee by the Company, as
Depositor, at any time (which direction is optional and wholly within the
discretion of the Company, as Depositor) to terminate the Trust and distribute
the Series C Junior Subordinated Notes to the holders of the Preferred
Securities in liquidation of the Trust (see "-- Special Event Redemption or
Distribution" above); or (iii) the payment at maturity or redemption of all of
the Series C Junior Subordinated Notes, and the consequent payment of the Trust
Securities.
If an early termination occurs as described in clause (i) or (ii) above,
the Trust shall be liquidated, and the Property Trustee shall distribute to each
holder of Preferred Securities and Common Securities a
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like amount of Series C Junior Subordinated Notes, unless in the case of an
event described in clause (i) such distribution is determined by the
Administrative Trustees not to be practical, in which event such holders will be
entitled to receive, out of the assets of the Trust available for distribution
to holders after satisfaction of liabilities to creditors, an amount equal to
the aggregate of the stated liquidation preference of $25 per Trust Security
plus accrued and unpaid distributions thereon to the date of payment (such
amount being the "Liquidation Distribution"). If such Liquidation Distribution
can be paid only in part because the Trust has insufficient assets available to
pay in full the aggregate Liquidation Distribution, then subject to the next
succeeding sentence, the amounts payable directly by the Trust on the Trust
Securities shall be paid on a pro rata basis. The holder of the Common
Securities will be entitled to receive distributions upon any such dissolution
pro rata with the holders of the Preferred Securities, except that if a
Subordinated Note Indenture Event of Default has occurred and is continuing, the
holders of Preferred Securities shall have a preference over the holders of
Common Securities.
EVENTS OF DEFAULT
Any one of the following events constitutes an "Event of Default" under the
Trust Agreement ("Trust Agreement Event of Default") with respect to the Trust
Securities issued thereunder (whatever the reason for such Event of Default, and
whether it shall be voluntary or involuntary or be effected by operation of law
or pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(i) the occurrence of an "Event of Default" as defined in Section 501
of the Subordinated Note Indenture ("Subordinated Note Indenture Event of
Default") (see "Description of the Series C Junior Subordinated
Notes -- Events of Default"); or
(ii) default by the Trust in the payment of any distribution when it
becomes due and payable, and the continuation of such default for a period
of 30 days; or
(iii) default by the Trust in the payment of any Redemption Price of
any Preferred Security or Common Security when it becomes due and payable;
or
(iv) default in the performance, or breach, of any covenant or
warranty of the Securities Trustees in the Trust Agreement (other than a
covenant or warranty a default in the performance of which or the breach of
which is dealt with in clause (ii) or (iii) above), and continuation of
such default or breach for a period of 60 days after there has been given,
by registered or certified mail, to such Securities Trustees by the holders
of at least 10% in liquidation amount of the outstanding Preferred
Securities a written notice specifying such default or breach and requiring
it to be remedied and stating that such notice is a "Notice of Default"
under the Trust Agreement; or
(v) the occurrence of certain events of bankruptcy or insolvency with
respect to the Trust.
Within 90 days after the occurrence of any Trust Agreement Event of
Default, the Property Trustee shall transmit notice of any default known to the
Property Trustee to the holders of Trust Securities and the Company, unless such
Trust Agreement Event of Default shall have been cured or waived.
If a Trust Agreement Event of Default occurs and is continuing, then,
pursuant to the Trust Agreement, holders of a majority in aggregate liquidation
amount of Preferred Securities have the right to direct the exercise of any
trust or power conferred upon the Property Trustee under the Trust Agreement,
including the right to direct the Property Trustee under the Trust Agreement to
exercise the remedies available to it as holder of the Series C Junior
Subordinated Notes. If the Property Trustee fails to enforce its rights under
the Series C Junior Subordinated Notes, a holder of Preferred Securities may, to
the fullest extent permitted by applicable law, institute a legal proceeding
directly against the Company to enforce its rights under the Trust Agreement
without first instituting any legal proceeding against the Property Trustee or
the Trust. Notwithstanding the foregoing, a holder of Preferred Securities may
institute a legal proceeding directly against the Company, without first
instituting a legal proceeding against the Property Trustee or any other person
or entity, for enforcement of payment to such holder of principal of or interest
on the Series C Junior Subordinated Notes having a principal amount equal to the
aggregate stated
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liquidation amount of the Preferred Securities of such holder on or after the
due dates specified in the Series C Junior Subordinated Notes. See "Relationship
Among the Preferred Securities, the Series C Junior Subordinated Notes and the
Guarantee" and "Description of the Guarantee -- Events of Default."
Unless a Subordinated Note Indenture Event of Default shall have occurred
and be continuing, the Securities Trustees may be removed at any time by act of
the holder of the Common Securities. If a Subordinated Note Indenture Event of
Default has occurred and is continuing, any Securities Trustee may be removed at
such time by act of the holders of a majority in liquidation amount of the
Preferred Securities, delivered to the appropriate Securities Trustee (in its
individual capacity and on behalf of the Trust). No resignation or removal of
any Securities Trustee and no appointment of a successor shall be effective
until the acceptance of appointment by the successor Trustee in accordance with
the requirements of the Trust Agreement.
If a Subordinated Note Indenture Event of Default has occurred and is
continuing, the holders of Preferred Securities shall have a preference over the
holders of Common Securities upon dissolution of the Trust as described above.
See "-- Liquidation Distribution Upon Dissolution."
VOTING RIGHTS
Except as provided below and under "Description of the
Guarantee -- Amendments and Assignment" and as otherwise required by law and the
Trust Agreement, the holders of the Preferred Securities will have no voting
rights.
If any proposed amendment to the Trust Agreement provides for, or the
Securities Trustees otherwise propose to effect, (i) any action that would
adversely affect the powers, preferences or special rights of the Preferred
Securities, whether by way of amendment to the Trust Agreement or otherwise, or
(ii) the dissolution, winding-up or termination of the Trust, other than
pursuant to the Trust Agreement, then the holders of outstanding Preferred
Securities will be entitled to vote as a class on such amendment or proposal of
the Securities Trustees, and such amendment or proposal shall not be effective
except with the approval of the holders of at least 66 2/3% in liquidation
amount of such outstanding Preferred Securities.
So long as any Series C Junior Subordinated Notes are held by the Property
Trustee, the Securities Trustees shall not (i) direct the time, method and place
of conducting any proceeding for any remedy available to the Indenture Trustee
(as defined herein), or executing any trust or power conferred on the Indenture
Trustee with respect to the Series C Junior Subordinated Notes, (ii) waive any
past default which is waivable under Section 513 of the Subordinated Note
Indenture, (iii) exercise any right to rescind or annul a declaration that the
principal of all the Series C Junior Subordinated Notes shall be due and
payable, or (iv) consent to any amendment, modification or termination of the
Subordinated Note Indenture or the Series C Junior Subordinated Notes, where
such consent shall be required, or to any other action, as the holder of the
Series C Junior Subordinated Notes, under the Subordinated Note Indenture,
without, in each case, obtaining the prior approval of the holders of at least
66 2/3% in liquidation amount of the outstanding Preferred Securities; provided,
however, that where a consent under the Subordinated Note Indenture would
require the consent of each holder of Series C Junior Subordinated Notes
affected thereby, no such consent shall be given by the Securities Trustees
without the prior consent of each holder of Preferred Securities. The Securities
Trustees shall not revoke any action previously authorized or approved by a vote
of the holders of the Preferred Securities, except pursuant to a subsequent vote
of such holders. The Property Trustee shall notify all holders of the Preferred
Securities of any notice of default received from the Indenture Trustee with
respect to the Series C Junior Subordinated Notes. In addition to obtaining the
foregoing approvals of the holders of the Preferred Securities, prior to taking
any of the foregoing actions, the Securities Trustees shall obtain an opinion of
counsel experienced in such matters to the effect that the Trust will not be
classified as other than a grantor trust for federal income tax purposes on
account of such action.
Any required approval of holders of Preferred Securities may be given at a
separate meeting of holders of Preferred Securities convened for such purpose or
pursuant to written consent. The
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Administrative Trustees will cause a notice of any meeting at which holders of
Preferred Securities are entitled to vote to be given to each holder of record
of Preferred Securities in the manner set forth in the Trust Agreement.
Notwithstanding that holders of Preferred Securities are entitled to vote
or consent under any of the circumstances described above, any of the Preferred
Securities that are owned by the Company, the Securities Trustees or any
affiliate of the Company or any Securities Trustee, shall, for purposes of such
vote or consent, be treated as if they were not outstanding.
CO-PROPERTY TRUSTEES AND SEPARATE PROPERTY TRUSTEE
At any time or times, for the purpose of meeting the legal requirements of
the 1939 Act or of any jurisdiction in which any part of the Trust Property (as
defined in the Trust Agreement) may at the time be located, the holder of the
Common Securities and the Property Trustee shall have power to appoint, and upon
the written request of the Property Trustee, the Company, as Depositor, shall
for such purpose join with the Property Trustee in the execution, delivery and
performance of all instruments and agreements necessary or proper to appoint,
one or more persons approved by the Property Trustee either to act as
co-property trustee, jointly with the Property Trustee, of all or any part of
such Trust Property, or to act as separate trustee of any such property, in
either case with such powers as may be provided in the instrument of
appointment, and to vest in such person or persons in such capacity, any
property, title, right or power deemed necessary or desirable, subject to the
provisions of the Trust Agreement. If the Company, as Depositor, does not join
in such appointment within 15 days after the receipt by it of a request so to
do, or in case a Subordinated Note Indenture Event of Default has occurred and
is continuing, the Property Trustee alone shall have power to make such
appointment.
AMENDMENT OF THE TRUST AGREEMENT
The Trust Agreement may be amended from time to time by the Company and the
Securities Trustees without the consent of the holders of the Trust Securities
(i) to cure any ambiguity, correct or supplement any provision therein which may
be inconsistent with any other provision therein, or to make any other
provisions with respect to matters or questions arising under the Trust
Agreement, which shall not be inconsistent with the other provisions of the
Trust Agreement, provided that the amendment does not adversely affect in any
material respect the interests of any holder of Trust Securities, or (ii) to
modify, eliminate or add to any provisions of the Trust Agreement to such extent
as shall be necessary to ensure that the Trust will not be classified as other
than a grantor trust for federal income tax purposes. Except as provided in the
succeeding paragraph, other amendments to the Trust Agreement may be made (i)
upon approval of the holders of not less than 66 2/3% in aggregate liquidation
amount of the Trust Securities then outstanding and (ii) upon receipt by the
Securities Trustees of an opinion of counsel to the effect that such amendment
will not affect the Trust's status as a grantor trust or the Trust's exemption
from the 1940 Act.
Notwithstanding the foregoing, without the consent of each affected holder
of Trust Securities, the Trust Agreement may not be amended to (i) change the
amount or timing of any distribution on the Trust Securities or otherwise
adversely affect the amount of any distribution required to be made in respect
of the Trust Securities as of a specified date, (ii) restrict the right of a
holder of Trust Securities to institute suit for the enforcement of any such
payment on or after such date, or (iii) change the consent required to amend the
Trust Agreement.
MERGERS, CONSOLIDATIONS OR AMALGAMATIONS
The Trust may not consolidate, amalgamate, merge with or into, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except as
described below. The Trust may at the request of the Company, with the consent
of the Administrative Trustees and without the consent of the holders of the
Trust Securities, consolidate, amalgamate, merge with or into, or be replaced by
a trust organized as such under the laws of any state;
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provided, that (i) such successor entity either (x) expressly assumes all of the
obligations of the Trust with respect to the Trust Securities or (y) substitutes
for the Preferred Securities other securities having substantially the same
terms as the Trust Securities (the "Successor Securities") so long as the
Successor Securities rank the same as the Trust Securities rank in priority with
respect to distributions and payments upon liquidation, redemption and
otherwise, (ii) the Company expressly appoints a trustee of such successor
entity possessing the same powers and duties as the Property Trustee as the
holder of the Series C Junior Subordinated Notes, (iii) the Preferred Securities
or any Successor Securities are listed, or any Successor Securities will be
listed upon notification of issuance, on any national securities exchange or
other organization on which the Preferred Securities are then listed, (iv) such
merger, consolidation, amalgamation or replacement does not cause the Preferred
Securities (including any Successor Securities) to be downgraded by any
nationally recognized statistical rating organization, (v) such merger,
consolidation, amalgamation or replacement does not adversely affect the rights,
preferences and privileges of the holders of the Trust Securities (including any
Successor Securities) in any material respect, (vi) such successor entity has a
purpose substantially identical to that of the Trust, (vii) prior to such
merger, consolidation, amalgamation or replacement, the Company has received an
opinion of counsel to the effect that (A) such merger, consolidation,
amalgamation or replacement does not adversely affect the rights, preferences
and privileges of the holders of the Trust Securities (including any Successor
Securities) in any material respect, and (B) following such merger,
consolidation, amalgamation or replacement, neither the Trust nor such successor
entity will be required to register as an investment company under the 1940 Act,
and (viii) the Company guarantees the obligations of such successor entity under
the Successor Securities at least to the extent provided by the Guarantee.
Notwithstanding the foregoing, the Trust shall not, except with the consent of
holders of 100% in liquidation amount of the Trust Securities, consolidate,
amalgamate, merge with or into, or be replaced by any other entity or permit any
other entity to consolidate, amalgamate, merge with or into, or replace it if
such consolidation, amalgamation, merger or replacement would cause the Trust or
the successor entity to be classified as other than a grantor trust for federal
income tax purposes.
Any corporation or other body into which any of the Property Trustee, the
Delaware Trustee or any Administrative Trustee that is not a natural person may
be merged or converted or with which it may be consolidated, or any corporation
or other body resulting from any merger, conversion or consolidation to which
any such Securities Trustee shall be a party, or any corporation or other body
succeeding to all or substantially all the corporate trust business of any such
Securities Trustee, shall be the successor of such Securities Trustee under the
Trust Agreement, provided such corporation is otherwise qualified and eligible
under the Trust Agreement.
PAYMENT AND PAYING AGENT
So long as DTC is acting as securities depositary for the Preferred
Securities, payments in respect of the Preferred Securities shall be made to
DTC, which is to credit the relevant accounts at DTC on the applicable
Distribution Dates. If the Preferred Securities are not held by DTC, such
payments shall be made by check mailed to the address of the holder entitled
thereto as such address shall appear on the Securities Register (as such term is
defined in the Trust Agreement). The Paying Agent shall initially be the
Property Trustee. The Paying Agent shall be permitted to resign as Paying Agent
upon 30 days' written notice to the Administrative Trustees and the Company. In
such event, the Administrative Trustees shall appoint a successor to act as
Paying Agent.
REGISTRAR AND TRANSFER AGENT
It is anticipated that the Property Trustee, or one of its affiliates, will
act as registrar and transfer agent (the "Securities Registrar") for the
Preferred Securities.
Registration of transfers of Preferred Securities will be effected without
charge by or on behalf of the Trust, but upon payment in respect of any tax or
other governmental charges which may be imposed in relation to it.
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The Securities Registrar will not be required to register or cause to be
registered any transfer of Preferred Securities after they have been called for
redemption.
INFORMATION CONCERNING THE PROPERTY TRUSTEE
The Property Trustee, prior to the occurrence of a Trust Agreement Event of
Default with respect to the Trust Securities, undertakes to perform only such
duties as are specifically set forth in the Trust Agreement and, after default,
shall exercise the same degree of care as a prudent individual would exercise in
the conduct of his or her own affairs. Subject to such provisions, the Property
Trustee is under no obligation to exercise any of the powers vested in it by the
Trust Agreement at the request of any holder of Preferred Securities, unless
offered reasonable indemnity by such holder against the costs, expenses and
liabilities which might be incurred thereby.
The Chase Manhattan Bank, the Property Trustee, also serves as Indenture
Trustee and Guarantee Trustee. The Company and certain of its affiliates
maintain deposit accounts and banking relationships with The Chase Manhattan
Bank. The Chase Manhattan Bank serves as trustee under the Company's First
Mortgage Bond Indenture and under other indentures pursuant to which first
mortgage bonds of affiliates of the Company are outstanding.
GOVERNING LAW
The Trust Agreement and the Trust Securities will be governed by, and
construed in accordance with, the internal laws of the State of Delaware;
provided that the immunities and standard of care of the Property Trustee shall
be governed by New York law.
MISCELLANEOUS
The Administrative Trustees are authorized and directed to operate the
Trust so that the Trust will not be deemed to be an "investment company"
required to be registered under the 1940 Act or taxed as other than a grantor
trust for federal income tax purposes and so that the Series C Junior
Subordinated Notes will be treated as indebtedness of the Company for federal
income tax purposes. In this connection, the Administrative Trustees and the
Company are authorized to take any action, not inconsistent with applicable law,
the Trust's certificate of trust or the Trust Agreement, that the Administrative
Trustees and the Company determine in their discretion to be necessary or
desirable for such purposes, as long as such action does not materially and
adversely affect the interests of the holders of the Preferred Securities.
DESCRIPTION OF THE GUARANTEE
Set forth below is a summary of information concerning the Guarantee that
will be executed and delivered by the Company for the benefit of the holders of
Preferred Securities from time to time. The Guarantee will be qualified as an
indenture under the 1939 Act. The Chase Manhattan Bank will act as indenture
trustee under the Guarantee (the "Guarantee Trustee") for purposes of the 1939
Act. The terms of the Guarantee will be those set forth therein and those made
part thereof by the 1939 Act. The following summary does not purport to be
complete and is subject in all respects to the provisions of, and is qualified
in its entirety by reference to, the Guarantee, the form of which is filed as an
exhibit to the Registration Statement of which this Prospectus forms a part, and
the 1939 Act. The Guarantee will be held by the Guarantee Trustee for the
benefit of holders of the Preferred Securities.
GENERAL
Pursuant to the Guarantee, the Company will irrevocably and unconditionally
agree, to the extent set forth therein, to pay in full, to the holders of the
Preferred Securities, the Guarantee Payments (as defined herein), to the extent
not paid by, or on behalf of, the Trust, regardless of any defense, right of
set-off or counterclaim that the Company may have or assert against any person.
The following payments or
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distributions with respect to the Preferred Securities to the extent not paid or
made by, or on behalf of, the Trust will be subject to the Guarantee (without
duplication): (i) any accrued and unpaid distributions required to be paid on
the Preferred Securities but if and only if and to the extent that the Trust has
funds legally and immediately available therefor, (ii) the Redemption Price with
respect to any Preferred Securities called for redemption by the Trust, but if
and only to the extent the Trust has funds legally and immediately available
therefor, and (iii) upon a dissolution, winding-up or termination of the Trust
(other than in connection with the distribution of Series C Junior Subordinated
Notes to the holders of Trust Securities or the redemption of all of the
Preferred Securities), the lesser of (a) the aggregate of the liquidation amount
and all accrued and unpaid distributions on the Preferred Securities to the date
of payment, to the extent the Trust has funds legally and immediately available
therefor, and (b) the amount of assets of the Trust remaining available for
distribution to holders of Preferred Securities in liquidation of the Trust (the
"Guarantee Payments"). The Company's obligation to make a Guarantee Payment may
be satisfied by direct payment of the required amounts by the Company to the
holders of the Preferred Securities or by causing the Trust to pay such amounts
to such holders.
The Guarantee will be a guarantee of the Guarantee Payments with respect to
the Preferred Securities from the time of issuance of the Preferred Securities,
but will not apply to the payment of distributions and other payments on the
Preferred Securities when the Trust does not have sufficient funds legally and
immediately available to make such distributions or other payments. IF THE
COMPANY DOES NOT MAKE INTEREST PAYMENTS ON THE SERIES C JUNIOR SUBORDINATED
NOTES HELD BY THE PROPERTY TRUSTEE, THE TRUST WILL NOT MAKE DISTRIBUTIONS ON THE
PREFERRED SECURITIES.
SUBORDINATION
The Company's obligations under the Guarantee to make the Guarantee
Payments will constitute an unsecured obligation of the Company and will rank
(i) subordinate and junior in right of payment to all other liabilities of the
Company, including the Series C Junior Subordinated Notes, except those
obligations or liabilities made pari passu or subordinate by their terms, (ii)
pari passu with the most senior preferred or preference stock now or hereafter
issued by the Company and with any guarantee now or hereafter entered into by
the Company in respect of any preferred or preference securities of any
affiliate of the Company, and (iii) senior to all common stock of the Company.
The terms of the Preferred Securities will provide that each holder of Preferred
Securities by acceptance thereof agrees to the subordination provisions and
other terms of the Guarantee. The Company has outstanding preferred stock that
ranks pari passu to the Guarantee and common stock that ranks junior to the
Guarantee. See "Selected Information -- Selected Financial Information."
The Guarantee will constitute a guarantee of payment and not of collection
(that is, the guaranteed party may institute a legal proceeding directly against
the guarantor to enforce its rights under the guarantee without first
instituting a legal proceeding against any other person or entity).
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes that do not materially and adversely
affect the rights of holders of the Preferred Securities (in which case no
consent will be required), the Guarantee may be amended only with the prior
approval of the holders of not less than 66 2/3% in liquidation amount of the
outstanding Preferred Securities. The manner of obtaining any such approval of
holders of the Preferred Securities is set forth under "Description of the
Preferred Securities -- Voting Rights." All guarantees and agreements contained
in the Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Company and shall inure to the benefit of the holders of
the Preferred Securities then outstanding.
TERMINATION
The Guarantee will terminate and be of no further force and effect as to
the Preferred Securities upon full payment of the Redemption Price of all
Preferred Securities, upon distribution of Series C Junior Subordinated Notes to
the holders of Preferred Securities, or upon full payment of the amounts payable
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upon liquidation of the Trust. The Guarantee will continue to be effective or
will be reinstated, as the case may be, if at any time any holder of the
Preferred Securities must restore payment of any sums paid with respect to the
Preferred Securities or under the Guarantee.
EVENTS OF DEFAULT
An event of default under the Guarantee will occur upon the failure by the
Company to perform any of its payment obligations thereunder. The holders of a
majority in liquidation amount of the Preferred Securities have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Guarantee Trustee in respect of the Guarantee or to direct the
exercise of any trust or power conferred upon the Guarantee Trustee under the
Guarantee. Any holder of the Preferred Securities may institute a legal
proceeding directly against the Company to enforce its rights under the
Guarantee without first instituting a legal proceeding against the Guarantee
Trustee or any other person or entity. The holders of a majority in liquidation
amount of Preferred Securities may, by vote, on behalf of the holders of all the
Preferred Securities, waive any past event of default and its consequences.
INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The Guarantee Trustee, prior to the occurrence of any event of default with
respect to the Guarantee and after the curing or waiving of all events of
default with respect to the Guarantee, undertakes to perform only such duties as
are specifically set forth in the Guarantee and, in case an event of default has
occurred, shall exercise the same degree of care as a prudent individual would
exercise in the conduct of his or her own affairs. Subject to such provisions,
the Guarantee Trustee is under no obligation to exercise any of the powers
vested in it by the Guarantee at the request of any holder of the Preferred
Securities, unless offered reasonable indemnity against the costs, expenses and
liabilities which might be incurred thereby.
The Chase Manhattan Bank, the Guarantee Trustee, also serves as Property
Trustee and as Indenture Trustee. The Company and certain of its affiliates
maintain deposit accounts and banking relationships with The Chase Manhattan
Bank. The Chase Manhattan Bank serves as trustee under the Company's First
Mortgage Bond Indenture and under other indentures pursuant to which first
mortgage bonds of affiliates of the Company are outstanding.
GOVERNING LAW
The Guarantee will be governed by, and construed in accordance with, the
internal laws of the State of New York.
THE AGREEMENT AS TO EXPENSES AND LIABILITIES
Pursuant to an Agreement as to Expenses and Liabilities to be entered into
by the Company under the Trust Agreement, the Company will irrevocably and
unconditionally guarantee to each person or entity to whom the Trust becomes
indebted or liable the full payment of any indebtedness, expenses or liabilities
of the Trust, other than obligations of the Trust to pay to the holders of the
Preferred Securities or other similar interests in the Trust the amounts due
such holders pursuant to the terms of the Preferred Securities or such other
similar interests, as the case may be.
DESCRIPTION OF THE SERIES C JUNIOR SUBORDINATED NOTES
Set forth below is a description of the terms of the Series C Junior
Subordinated Notes. The following description does not purport to be complete
and is subject to, and is qualified in its entirety by reference to, the
Subordinated Note Indenture, dated as of , 1997, between the Company
and The Chase Manhattan Bank, as trustee (the "Indenture Trustee"), as to be
supplemented by a supplemental indenture thereto establishing the Series C
Junior Subordinated Notes (the Subordinated Note Indenture, as so supplemented,
is hereinafter referred to as the "Subordinated Note Indenture"), the forms of
which
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are filed as exhibits to the Registration Statement of which this Prospectus
forms a part. The terms of the Series C Junior Subordinated Notes will include
those stated in the Subordinated Note Indenture and those made a part of the
Subordinated Note Indenture by reference to the 1939 Act. Certain capitalized
terms used herein are defined in the Subordinated Note Indenture.
GENERAL
The Series C Junior Subordinated Notes will be issued as a series of
unsecured junior subordinated debt securities (collectively, the "Junior
Subordinated Notes") under the Subordinated Note Indenture. The Subordinated
Note Indenture does not limit the aggregate principal amount of Junior
Subordinated Notes that may be issued thereunder and provides that Junior
Subordinated Notes may be issued from time to time in one or more series
pursuant to an indenture supplemental to the Subordinated Note Indenture. The
Series C Junior Subordinated Notes will be limited in aggregate principal amount
to $206,186,000, such amount being the approximate aggregate liquidation amount
of the Trust Securities.
The entire principal amount of the Series C Junior Subordinated Notes will
mature and become due and payable, together with any accrued and unpaid interest
thereon, including Additional Interest, if any, on , 2037. The
Series C Junior Subordinated Notes are not subject to any sinking fund
provision.
The terms of the Series C Junior Subordinated Notes correspond to those of
the Preferred Securities, as described herein.
The Subordinated Note Indenture does not contain provisions that afford
holders of Junior Subordinated Notes protection in the event of a highly
leveraged transaction involving the Company.
SUBORDINATION
The Junior Subordinated Notes are subordinated and junior in right of
payment to all Senior Indebtedness (as defined below) of the Company. No payment
of principal of (including redemption payments, if any), or premium, if any, or
interest on (including Additional Interest (as defined herein)) the Junior
Subordinated Notes may be made if (a) any Senior Indebtedness is not paid when
due and any applicable grace period with respect to such default has ended with
such default not being cured or waived or otherwise ceasing to exist, or (b) the
maturity of any Senior Indebtedness has been accelerated because of a default,
or (c) notice has been given of the exercise of an option to require repayment,
mandatory payment or prepayment or otherwise. Upon any payment or distribution
of assets of the Company to creditors upon any liquidation, dissolution,
winding-up, reorganization, assignment for the benefit of creditors, marshalling
of assets or liabilities, or any bankruptcy, insolvency or similar proceedings
of the Company, the holders of Senior Indebtedness shall be entitled to receive
payment in full of all amounts due or to become due on or in respect of all
Senior Indebtedness before the holders of the Junior Subordinated Notes are
entitled to receive or retain any payment or distribution. Subject to the prior
payment of all Senior Indebtedness, the rights of the holders of the Junior
Subordinated Notes will be subrogated to the rights of the holders of Senior
Indebtedness to receive payments and distributions applicable to such Senior
Indebtedness until all amounts owing on the Junior Subordinated Notes are paid
in full.
The term "Senior Indebtedness" means, with respect to the Company, (i) any
payment due in respect of indebtedness of the Company, whether outstanding at
the date of execution of the Subordinated Note Indenture or thereafter incurred,
created or assumed, (a) in respect of money borrowed (including any financial
derivative, hedging or futures contract or similar instrument) and (b) evidenced
by securities, debentures, bonds, notes or other similar instruments issued by
the Company that, by their terms, are senior or senior subordinated debt
securities including, without limitation, all obligations under its indentures
with various trustees; (ii) all capital lease obligations; (iii) all obligations
issued or assumed as the deferred purchase price of property, all conditional
sale obligations and all obligations of the Company under any title retention
agreement (but excluding trade accounts payable arising in the ordinary course
of business and long-term purchase obligations); (iv) all
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obligations for the reimbursement of any letter of credit, banker's acceptance,
security purchase facility or similar credit transaction; (v) all obligations of
the type referred to in clauses (i) through (iv) above of other persons the
payment of which the Company is responsible or liable as obligor, guarantor or
otherwise; and (vi) all obligations of the type referred to in clauses (i)
through (v) above of other persons secured by any lien on any property or asset
of the Company (whether or not such obligation is assumed by the Company),
except for (1) any such indebtedness that is by its terms subordinated to or
pari passu with the Junior Subordinated Notes and (2) any unsecured indebtedness
between or among the Company or its affiliates. Such Senior Indebtedness shall
continue to be Senior Indebtedness and be entitled to the benefits of the
subordination provisions contained in the Subordinated Note Indenture
irrespective of any amendment, modification or waiver of any term of such Senior
Indebtedness.
The Subordinated Note Indenture does not limit the aggregate amount of
Senior Indebtedness that may be issued by the Company. As of March 31, 1997,
Senior Indebtedness of the Company aggregated approximately $3,474,000,000.
OPTIONAL REDEMPTION
The Company shall have the right to redeem the Series C Junior Subordinated
Notes, in whole or in part, without premium, from time to time, on or after
, 2002, or at any time in whole upon the occurrence of a Special Event
as described under "Description of the Preferred Securities -- Special Event
Redemption or Distribution," upon not less than 30 nor more than 60 days'
notice, at a Redemption Price equal to 100% of the principal amount to be
redeemed plus any accrued and unpaid interest, including Additional Interest, if
any, to the Redemption Date. If a partial redemption of the Series C Junior
Subordinated Notes would result in the delisting of the Preferred Securities,
the Company may only redeem the Series C Junior Subordinated Notes in whole.
INTEREST
Each Series C Junior Subordinated Note shall bear interest at the
Securities Rate from the Issue Date, payable quarterly in arrears on March 31,
June 30, September 30 and December 31 of each year to the person in whose name
such Series C Junior Subordinated Note is registered at the close of business on
the fifteenth calendar day prior to such payment date. The amount of interest
payable will be computed 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 C Junior
Subordinated Notes is not a Business Day, then payment of the interest payable
on such date will be made on the next succeeding day which is a Business Day
(and without any interest or other payment in respect of any such delay), 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 such date.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
The Company shall have the right at any time, and from time to time, to
defer payments of interest on the Series C Junior Subordinated Notes by
extending the interest payment period for up to 20 consecutive quarters, but not
beyond the stated maturity date. At the end of an Extension Period, the Company
shall pay all interest then accrued and unpaid (including any Additional
Interest) (together with interest thereon at the Securities Rate compounded
quarterly); provided, that if the Company shall have given notice of its
election to select an Extension Period, subject to the exceptions described
under "-- Certain Covenants" below, (a) the Company shall not declare or pay any
dividend or distribution on, or redeem, purchase, acquire or make a liquidation
payment with respect to, any of its capital stock or make any guarantee payments
with respect to the foregoing, and (b) the Company shall not make any payment of
interest, principal or premium, if any, on or repay, repurchase or redeem any
debt securities (including guarantees other than the Guarantee) issued by the
Company which rank pari passu with or junior to the Series C Junior Subordinated
Notes. Prior to the termination of any Extension Period, the Company may further
defer payments of interest by extending the interest payment period, provided
that such Extension Period, together with all such previous and further
extensions thereof, may not exceed
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20 consecutive quarters. Upon the termination of any Extension Period and the
payment of all amounts then due, the Company may select a new Extension Period,
subject to the above requirements. The Company has no present intention of
exercising its rights to defer payments of interest by extending the interest
payment period on the Series C Junior Subordinated Notes.
The Company shall give the holder or holders of the Series C Junior
Subordinated Notes and the Indenture Trustee notice of its selection or
extension of an Extension Period at least one Business Day prior to the earlier
of (i) the record date relating to the interest payment date on which the
Extension Period is to commence or relating to the interest payment date on
which an Extension Period that is being extended would otherwise terminate or
(ii) the date the Company or the Trust is required to give notice to the NYSE or
other applicable self-regulatory organization of the record date or the date
such distributions are payable.
ADDITIONAL INTEREST
"Additional Interest" is defined in the Subordinated Note Indenture as (i)
such additional amounts as may be required so that the net amounts received and
retained by a holder of Junior Subordinated Notes (if the holder is a Trust)
after paying taxes, duties, assessments or governmental charges of whatever
nature (other than withholding taxes) imposed by the United States or any other
taxing authority will not be less than the amounts the holder would have
received had no such taxes, duties, assessments, or other governmental charges
been imposed; and (ii) any interest due and not paid on an interest payment
date, together with interest thereon from such interest payment date to the date
of payment, compounded quarterly, on each interest payment date.
CERTAIN COVENANTS
The Company covenants in the Subordinated Note Indenture, for the benefit
of the holders of each series of Junior Subordinated Notes, that, (i) if at such
time the Company shall have given notice of its election to extend an interest
payment period for such series of Junior Subordinated Notes and such extension
shall be continuing, (ii) if at such time the Company shall be in default with
respect to its payment or other obligations under the Guarantee with respect to
the Trust Securities, if any, related to such series of Junior Subordinated
Notes, or (iii) if at such time an Event of Default thereunder with respect to
such series of Junior Subordinated Notes shall have occurred and be continuing,
(a) the Company shall not declare or pay any dividend or make any distributions
with respect to, or redeem, purchase, acquire or make a liquidation payment with
respect to, any of its capital stock, and (b) the Company shall not make any
payment of interest, principal or premium, if any, on or repay, repurchase or
redeem any debt securities (including guarantees other than the Guarantees)
issued by the Company which rank pari passu with or junior to the Junior
Subordinated Notes. None of the foregoing, however, shall restrict (i) any of
the actions described in the preceding sentence resulting from any
reclassification of the Company's capital stock or the exchange or conversion of
one class or series of the Company's capital stock for another class or series
of the Company's capital stock, or (ii) the purchase of fractional interests in
shares of the Company's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged.
The Subordinated Note Indenture further provides that, for so long as the
Trust Securities of any Trust remain outstanding, the Company covenants (i) to
directly or indirectly maintain 100% ownership of the Common Securities of such
Trust; provided, however, that any permitted successor of the Company under the
Subordinated Note Indenture may succeed to the Company's ownership of such
Common Securities, and (ii) to use its reasonable efforts to cause such Trust
(a) to remain a statutory business trust, except in connection with the
distribution of Junior Subordinated Notes to the holders of Trust Securities in
liquidation of such Trust, the redemption of all of the Trust Securities of such
Trust, or certain mergers, consolidations or amalgamations, each as permitted by
the related Trust Agreement, and (b) to otherwise continue to be classified as a
grantor trust for United States federal income tax purposes.
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EVENTS OF DEFAULT
The Subordinated Note Indenture provides that any one or more of the
following described events with respect to the Junior Subordinated Notes of any
series, which has occurred and is continuing, constitutes an "Event of Default"
with respect to the Junior Subordinated Notes of such series:
(a) failure for 10 days to pay interest on the Junior Subordinated
Notes of such series, including any Additional Interest (as defined in
clause (ii) of the definition thereof in the Subordinated Note Indenture)
in respect thereof, when due on an Interest Payment Date other than at
maturity or upon earlier redemption; provided, however, that a valid
extension of the interest payment period by the Company shall not
constitute a default in the payment of interest for this purpose; or
(b) failure for 10 days to pay Additional Interest (as defined in
clause (i) of the definition thereof in the Subordinated Note Indenture);
or
(c) failure to pay principal or premium, if any, or interest,
including Additional Interest (as defined in clause (ii) of the definition
thereof in the Subordinated Note Indenture), on the Junior Subordinated
Notes of such series when due at maturity or upon earlier redemption; or
(d) failure for three Business Days to deposit any sinking fund
payment when due by the terms of a Junior Subordinated Note of such series;
or
(e) failure to observe or perform any other covenant or warranty of
the Company in the Subordinated Note Indenture (other than a covenant or
warranty which has expressly been included therein solely for the benefit
of one or more series of Junior Subordinated Notes other than such series)
for 90 days after written notice to the Company from the Indenture Trustee
or the holders of at least 25% in principal amount of the outstanding
Junior Subordinated Notes of such series; or
(f) certain events of bankruptcy, insolvency, or reorganization of the
Company.
The holders of not less than a majority in aggregate outstanding principal
amount of the Junior Subordinated Notes of any series have the right to direct
the time, method and place of conducting any proceeding for any remedy available
to the Indenture Trustee with respect to the Junior Subordinated Notes of such
series. If a Subordinated Note Indenture Event of Default occurs and is
continuing with respect to the Junior Subordinated Notes of any series, then the
Indenture Trustee or the holders of not less than 25% in aggregate outstanding
principal amount of the Junior Subordinated Notes of such series may declare the
principal amount thereof due and payable immediately by notice in writing to the
Company (and to the Indenture Trustee if given by the holders), and upon any
such declaration such principal amount shall become immediately due and payable.
At any time after such a declaration of acceleration with respect to the Junior
Subordinated Notes of any series has been made and before a judgment or decree
for payment of the money due has been obtained as provided in Article Five of
the Subordinated Note Indenture, the holders of not less than a majority in
aggregate outstanding principal amount of the Junior Subordinated Notes of such
series may rescind and annul such declaration and its consequences if the
default has been cured or waived and the Company has paid or deposited with the
Indenture Trustee a sum sufficient to pay all matured installments of interest
(including any Additional Interest) and principal due otherwise than by
acceleration and all sums paid or advanced by the Indenture Trustee, including
reasonable compensation and expenses of the Indenture Trustee.
A holder of Preferred Securities may institute a legal proceeding directly
against the Company, without first instituting a legal proceeding against the
Property Trustee or any other person or entity, for enforcement of payment to
such holder of principal of or interest on the Junior Subordinated Notes of the
related series having a principal amount equal to the aggregate stated
liquidation amount of the Preferred Securities of such holder on or after the
due dates specified in the Junior Subordinated Notes of such series.
The holders of not less than a majority in aggregate outstanding principal
amount of the Junior Subordinated Notes of any series may, on behalf of the
holders of all the Junior Subordinated Notes of
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such series, waive any past default with respect to such series, except (i) a
default in the payment of principal or interest or (ii) a default in respect of
a covenant or provision which under Article Nine of the Subordinated Note
Indenture cannot be modified or amended thereunder without the consent of the
holder of each outstanding Junior Subordinated Note of such series affected
thereby.
BOOK-ENTRY AND ISSUANCE
If distributed to holders of Trust Securities in connection with the
voluntary or involuntary dissolution, winding-up or liquidation of the Trust,
the Series C Junior Subordinated Notes are expected to be issued in the form of
one or more global certificates registered in the name of the securities
depositary or its nominee. In such event, the procedures applicable to the
transfer and payment of the Series C Junior Subordinated Notes are expected to
be substantially similar to those described with respect to the Preferred
Securities in "Description of the Preferred Securities -- Book-Entry Only
Issuance -- The Depository Trust Company."
REGISTRATION AND TRANSFER
The Company shall not be required to (i) issue, register the transfer of or
exchange Junior Subordinated Notes of any series during a period of 15 days
immediately preceding the date notice is given identifying the Junior
Subordinated Notes of such series called for redemption, or (ii) register the
transfer of or exchange any Junior Subordinated Notes so selected for
redemption, in whole or in part, except the unredeemed portion of any Junior
Subordinated Note being redeemed in part.
PAYMENT AND PAYING AGENT
Unless otherwise indicated in an applicable Prospectus Supplement, payment
of principal of any Junior Subordinated Notes will be made only against
surrender to the Paying Agent of such Junior Subordinated Notes. Principal of
and interest on Junior Subordinated Notes will be payable, subject to any
applicable laws and regulations, at the office of such Paying Agent or Paying
Agents as the Company may designate from time to time, except that, at the
option of the Company, payment of any interest may be made by wire transfer or
by check mailed to the address of the person entitled thereto as such address
shall appear in the Security Register with respect to the Junior Subordinated
Notes. Payment of interest on Junior Subordinated Notes on any interest payment
date will be made to the person in whose name the Junior Subordinated Notes (or
predecessor security) are registered at the close of business on the Record Date
for such interest payment (the fifteenth calendar day before such interest
payment date).
The Indenture Trustee will act as Paying Agent with respect to the Junior
Subordinated Notes. The Company may at any time designate additional Paying
Agents or rescind the designation of any Paying Agents or approve a change in
the office through which any Paying Agent acts.
All moneys paid by the Company to a Paying Agent for the payment of the
principal of or interest on the Junior Subordinated Notes of any series which
remain unclaimed at the end of two years after such principal or interest shall
have become due and payable will be repaid to the Company, and the holder of
such Junior Subordinated Notes will thereafter look only to the Company for
payment thereof.
MODIFICATION
The Subordinated Note Indenture contains provisions permitting the Company
and the Indenture Trustee, with the consent of the holders of not less than a
majority in principal amount of the outstanding Junior Subordinated Notes of
each series affected thereby, to modify the Subordinated Note Indenture or the
rights of the holders of the Junior Subordinated Notes of such series; provided,
that no such modification may, without the consent of the holder of each
outstanding Junior Subordinated Note affected thereby, (i) change the stated
maturity of the principal of, or any installment of principal of or interest on,
any Junior Subordinated Note, or reduce the principal amount thereof or the rate
of interest (including Additional Interest) thereon or any premium payable upon
the redemption thereof, or change
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the method of calculating the rate of interest thereon, or impair the right to
institute suit for the enforcement of any such payment on or after the stated
maturity thereof (or, in the case of redemption, on or after the redemption
date), or (ii) reduce the percentage of principal amount of the outstanding
Junior Subordinated Notes of any series, the consent of whose holders is
required for any such supplemental indenture, or the consent of whose holders is
required for any waiver (of compliance with certain provisions of the
Subordinated Note Indenture or certain defaults thereunder and their
consequences) provided for in the Subordinated Note Indenture, or (iii) modify
any of the provisions of the Subordinated Note Indenture relating to
supplemental indentures, waiver of past defaults, or waiver of certain
covenants, except to increase any such percentage or to provide that certain
other provisions of the Subordinated Note Indenture cannot be modified or waived
without the consent of the holder of each outstanding Junior Subordinated Note
affected thereby, or (iv) modify the provisions of the Subordinated Note
Indenture with respect to the subordination of the Junior Subordinated Notes in
a manner adverse to such holder.
In addition, the Company and the Indenture Trustee may execute, without the
consent of any holders of Junior Subordinated Notes, any supplemental indenture
for certain other usual purposes, including the creation of any new series of
junior subordinated notes.
CONSOLIDATION, MERGER AND SALE
The Company shall not consolidate with or merge into any other corporation
or convey, transfer or lease its properties and assets substantially as an
entirety to any person, unless (1) such other corporation or person is a
corporation organized and existing under the laws of the United States, any
state thereof or the District of Columbia and such other corporation or person
expressly assumes, by supplemental indenture executed and delivered to the
Indenture Trustee, the payment of the principal of (and premium, if any) and
interest (including Additional Interest) on all the Junior Subordinated Notes
and the performance of every covenant of the Subordinated Note Indenture on the
part of the Company to be performed or observed; (2) immediately after giving
effect to such transactions, no Event of Default, and no event which, after
notice or lapse of time or both, would become an Event of Default, shall have
happened and be continuing; and (3) the Company has delivered to the Indenture
Trustee an officers' certificate and an opinion of counsel, each stating that
such transaction complies with the provisions of the Subordinated Note Indenture
governing consolidation, merger, conveyance, transfer or lease and that all
conditions precedent thereto have been complied with.
INFORMATION CONCERNING THE INDENTURE TRUSTEE
The Indenture Trustee, prior to an Event of Default with respect to Junior
Subordinated Notes of any series, undertakes to perform, with respect to Junior
Subordinated Notes of such series, only such duties as are specifically set
forth in the Subordinated Note Indenture and, in case an Event of Default with
respect to Junior Subordinated Notes of any series has occurred and is
continuing, shall exercise, with respect to Junior Subordinated Notes of such
series, the same degree of care as a prudent individual would exercise in the
conduct of his or her own affairs. Subject to such provision, the Indenture
Trustee is under no obligation to exercise any of the powers vested in it by the
Subordinated Note Indenture at the request of any holder of Junior Subordinated
Notes of any series, unless offered reasonable indemnity by such holder against
the costs, expenses and liabilities which might be incurred thereby. The
Indenture Trustee is not required to expend or risk its own funds or otherwise
incur any financial liability in the performance of its duties if the Indenture
Trustee reasonably believes that repayment or adequate indemnity is not
reasonably assured to it.
The Chase Manhattan Bank, the Indenture Trustee, also serves as Property
Trustee and as Guarantee Trustee. The Company and certain of its affiliates
maintain deposit accounts and banking relationships with The Chase Manhattan
Bank. The Chase Manhattan Bank also serves as trustee under the Company's First
Mortgage Bond Indenture and under other indentures pursuant to which first
mortgage bonds of affiliates of the Company are outstanding.
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GOVERNING LAW
The Subordinated Note Indenture and the Junior Subordinated Notes will be
governed by, and construed in accordance with, the internal laws of the State of
New York.
MISCELLANEOUS
The Company will have the right at all times to assign any of its rights or
obligations under the Subordinated Note Indenture to a direct or indirect
wholly-owned subsidiary of the Company; provided, that, in the event of any such
assignment, the Company will remain primarily liable for all such obligations.
Subject to the foregoing, the Subordinated Note Indenture will be binding upon
and inure to the benefit of the parties thereto and their respective successors
and assigns.
RELATIONSHIP AMONG THE PREFERRED SECURITIES,
THE SERIES C JUNIOR SUBORDINATED NOTES AND THE GUARANTEE
As long as payments of interest and other payments are made when due on the
Series C Junior Subordinated Notes, such payments will be sufficient to cover
distributions and payments due on the Trust Securities primarily because (i) the
aggregate principal amount of Series C Junior Subordinated Notes will be equal
to the sum of the aggregate stated liquidation amount of the Trust Securities;
(ii) the interest rate and interest and other payment dates on the Series C
Junior Subordinated Notes will match the distribution rate and distribution and
other payment dates for the Preferred Securities; (iii) the Company shall pay
for all costs and expenses of the Trust pursuant to the Agreement as to Expenses
and Liabilities; and (iv) the Trust Agreement provides that the Securities
Trustees shall not cause or permit the Trust to, among other things, engage in
any activity that is not consistent with the purposes of the Trust.
Payments of distributions (to the extent funds therefor are legally and
immediately available) and other payments due on the Preferred Securities (to
the extent funds therefor are legally and immediately available) are guaranteed
by the Company as and to the extent set forth under "Description of the
Guarantee." If the Company does not make interest payments on the Series C
Junior Subordinated Notes, it is not expected that the Trust will have
sufficient funds to pay distributions on the Preferred Securities. The Guarantee
is a guarantee from the time of its issuance, but does not apply to any payment
of distributions unless and until the Trust has sufficient funds legally and
immediately available for the payment of such distributions.
If the Company fails to make interest or other payments on the Series C
Junior Subordinated Notes when due (taking into account any Extension Period),
the Trust Agreement provides a mechanism whereby the holders of the Preferred
Securities may appoint a substitute Property Trustee. Such holders may also
direct the Property Trustee to enforce its rights under the Series C Junior
Subordinated Notes, including proceeding directly against the Company to enforce
the Series C Junior Subordinated Notes. If the Property Trustee fails to enforce
its rights under the Series C Junior Subordinated Notes, to the fullest extent
permitted by applicable law, any holder of Preferred Securities may institute a
legal proceeding directly against the Company to enforce the Property Trustee's
rights under the Series C Junior Subordinated Notes without first instituting
any legal proceeding against the Property Trustee or any other person or entity.
Notwithstanding the foregoing, a holder of Preferred Securities may institute a
legal proceeding directly against the Company, without first instituting a legal
proceeding against the Property Trustee or any other person or entity, for
enforcement of payment to such holder of principal of or interest on the Series
C Junior Subordinated Notes having a principal amount equal to the aggregate
stated liquidation amount of the Preferred Securities of such holder on or after
the due dates specified in the Series C Junior Subordinated Notes.
If the Company fails to make payments under the Guarantee, the Guarantee
provides a mechanism whereby the holders of the Preferred Securities may direct
the Guarantee Trustee to enforce its rights thereunder. In addition, any holder
of Preferred Securities may institute a legal proceeding directly against
32
<PAGE>
the Company to enforce the Guarantee Trustee's rights under the Guarantee
without first instituting a legal proceeding against the Guarantee Trustee or
any other person or entity.
The Guarantee, the Subordinated Note Indenture, the Series C Junior
Subordinated Notes, the Trust Agreement and the Agreement as to Expenses and
Liabilities, as described above, constitute a full and unconditional guarantee
by the Company of the payments due on the Preferred Securities.
Upon any voluntary or involuntary dissolution, winding-up or termination of
the Trust, unless the Series C Junior Subordinated Notes are distributed in
connection therewith, the holders of Preferred Securities will be entitled to
receive, out of assets legally available for distribution to holders, the
Liquidation Distribution in cash. See "Description of the Preferred
Securities -- Liquidation Distribution Upon Dissolution." Upon any voluntary or
involuntary liquidation or bankruptcy of the Company, the Property Trustee, as
holder of the Series C Junior Subordinated Notes, would be a subordinated
creditor of the Company, subordinated in right of payment to all Senior
Indebtedness, but entitled to receive payment in full of principal and interest,
before any stockholders of the Company receive payments or distributions.
Because the Company is guarantor under the Guarantee and has agreed to pay for
all costs, expenses and liabilities of the Trust (other than the Trust's
obligations to holders of the Preferred Securities) pursuant to the Agreement as
to Expenses and Liabilities, the positions of a holder of Preferred Securities
and a holder of Series C Junior Subordinated Notes relative to other creditors
and to stockholders of the Company in the event of liquidation or bankruptcy of
the Company would be substantially the same.
A default or event of default under any Senior Indebtedness would not
constitute a default or Event of Default under the Subordinated Note Indenture.
However, in the event of payment defaults under, or acceleration of, Senior
Indebtedness, the subordination provisions of the Series C Junior Subordinated
Notes provide that no payments may be made in respect of the Series C Junior
Subordinated Notes until such Senior Indebtedness has been paid in full or any
payment default thereunder has been cured or waived. Failure to make required
payments on the Series C Junior Subordinated Notes would constitute an Event of
Default under the Subordinated Note Indenture except that failure to make
interest payments on the Series C Junior Subordinated Notes will not be an Event
of Default during an Extension Period; provided, however, that any Extension
Period may not exceed 20 consecutive quarters or extend beyond the stated
maturity of the Series C Junior Subordinated Notes.
CERTAIN FEDERAL INCOME TAX CONSIDERATIONS
The following is a summary of certain material United States federal income
tax consequences of the ownership and disposition of the Preferred Securities
and constitutes the opinion of Troutman Sanders LLP, counsel to the Company and
the Trust, insofar as it relates to matters of law and legal conclusions. This
summary deals only with Preferred Securities held as capital assets within the
meaning of Section 1221 of the Internal Revenue Code of 1986, as amended to the
date hereof (the "Code"), by Holders (as defined herein). Moreover, it does not
discuss all of the tax consequences that may be relevant to a Holder in light of
his particular circumstances or to Holders subject to special rules, such as
certain financial institutions, insurance companies, dealers in securities,
individual retirement and certain tax deferred accounts, and persons who engage
in a straddle or a hedge relating to a Preferred Security. Prospective investors
should consult their own tax advisors with regard to the application of the tax
considerations discussed below to their particular situations as well as the
application of any state, local or other tax laws. This summary is based on
laws, existing and proposed regulations, and applicable judicial and
administrative determinations, all of which are subject to change at any time,
and any such changes may be retroactively applied in a manner that could
adversely affect Holders. As used herein, the term "Holder" means a beneficial
owner of a Preferred Security that for United States federal income tax purposes
is (i) a citizen or resident of the United States, (ii) a corporation,
partnership or other entity created or organized in or under the laws of the
United States or of any political subdivision thereof, or (iii) an estate or
trust the income of which is subject to United States federal income taxation
regardless
33
<PAGE>
of its source. Thus, the following summary does not address any tax consequences
that apply specifically to nonresident aliens or foreign entities.
TREATMENT OF THE TRUST AND PREFERRED SECURITIES FOR FEDERAL INCOME TAX PURPOSES
The Trust will be treated as a "grantor trust" and not as an association
taxable as a corporation for federal income tax purposes. Thus, for federal
income tax purposes, each Holder will be treated as the beneficial owner of a
pro rata undivided interest in the Series C Junior Subordinated Notes and,
consequently, will be required to include in income the Holder's pro rata share
of the entire income from the Series C Junior Subordinated Notes. Each Holder
generally will determine its net income or loss with respect to the Trust in
accordance with its own method of accounting, although income arising from OID,
if any, must be taken into account under the accrual method of accounting even
if the Holder otherwise would use the cash receipts and disbursements method.
ORIGINAL ISSUE DISCOUNT
Under applicable income tax regulations, the Company believes that the
Series C Junior Subordinated Notes will not be treated as issued with OID. It
should be noted that these regulations have not yet been addressed in any
rulings or other interpretations by the Internal Revenue Service (the "IRS").
Accordingly, it is possible that the IRS could take a position contrary to the
interpretations described herein.
The terms of the Series C Junior Subordinated Notes permit the Company to
defer the payment of interest on the Series C Junior Subordinated Notes at any
time and from time to time by extending the interest payment period for up to 20
consecutive quarters with respect to each Extension Period; provided, however,
that no Extension Period may extend beyond the stated maturity date of the
Series C Junior Subordinated Notes. Should the Company exercise this option to
defer payments of interest, the Series C Junior Subordinated Notes would at that
time be treated as issued with OID and all the stated interest payments on the
Series C Junior Subordinated Notes would thereafter be treated as OID for so
long as they remained outstanding. As a result, all Holders would, in effect, be
required to accrue interest income even if such Holders are on a cash method of
accounting. Consequently, in the event that the payment of interest is deferred,
a Holder could be required to include OID in income on an economic accrual
basis, notwithstanding that the Company will not make any interest payments
during such period on the Series C Junior Subordinated Notes.
MARKET DISCOUNT
A purchaser of a Preferred Security at a discount from the adjusted issue
price of such purchaser's pro rata share of the Series C Junior Subordinated
Notes acquires such Preferred Security with "market discount." However, market
discount with respect to a Preferred Security will be considered to be zero if
it is de minimis. Market discount will be de minimis with respect to a Preferred
Security if it is less than the product of (i) 0.25% of the adjusted issue price
of the purchaser's pro rata share of the Series C Junior Subordinated Notes
multiplied by (ii) the number of complete years to maturity of such Series C
Junior Subordinated Notes after the date of purchase. The purchaser of a
Preferred Security with more than a de minimis amount of market discount
generally will be required to treat any gain on the sale, exchange, redemption
or other disposition of all or part of the Preferred Securities (or related
Series C Junior Subordinated Notes) as ordinary income to the extent of accrued
(but not previously taxed) market discount. Market discount generally will
accrue ratably during the period from the date of purchase of such Preferred
Security to the maturity date of the Series C Junior Subordinated Notes, unless
the Holder irrevocably elects to accrue such market discount on the basis of a
constant interest rate.
A Holder who has acquired a Preferred Security at a market discount
generally will be required to defer any deductions of interest expense
attributable to any indebtedness incurred or continued to purchase or carry the
Preferred Security, to the extent such interest expense exceeds the related
interest income. Any such deferred interest expense generally will be allowable
as a deduction not later than the year in which the related market discount
income is recognized. As an alternative to the inclusion of
34
<PAGE>
market discount in income upon disposition of all or a portion of a Preferred
Security or the related Series C Junior Subordinated Notes (including
redemptions thereof), a Holder may make an election (which may not be revoked
without the Internal Revenue Service's consent) to include market discount in
income as it accrues on all market discount instruments acquired by the Holder
during or after the taxable year for which the election is made. In that case,
the preceding deferral rule for interest expense will not apply.
In lieu of the foregoing treatment of market discount and interest expense,
a Holder may elect to treat any market discount (including a de minimis amount)
as OID and accrue such discount on a constant-yield basis in the same manner as
the Holder accrues OID.
SALE OF PREFERRED SECURITIES
Upon the sale, retirement (including redemption) or other taxable
disposition of all or part of a Preferred Security, a Holder thereof will
recognize gain or loss equal to the difference between the amount realized on
such sale, retirement or other disposition and such Holder's adjusted tax basis
in the Preferred Security or part thereof. If the Holder disposes of a Preferred
Security prior to the occurrence of an Extension Period, any portion of the
amount received that is attributable to accrued interest will be treated as
interest income to the Holder and will not be treated as part of the amount
realized for purposes of determining gain or loss on the disposition of the
Preferred Security. Any recognized gain or loss will be capital gain or loss,
except to the extent of any accrued market discount (see "Market Discount"
above), and such capital gain or loss will be long-term if the holding period
for the Preferred Security is more than one year at the time of sale, retirement
or other disposition. A Holder's adjusted tax basis in a Preferred Security
acquired by purchase will equal the cost of such Preferred Security to the
Holder, increased by the amount of any related accrued OID and market discount
included in taxable income by the Holder and reduced by any prior payments on
the Series C Junior Subordinated Notes distributed on the Preferred Security.
The redemption of only part of a Preferred Security will require an allocation
of the Holder's pro rata share of the adjusted issue price of the related Series
C Junior Subordinated Notes between the portion of the Series C Junior
Subordinated Notes redeemed and retained by the Holder in order to determine
gain or loss.
RECEIPT OF SERIES C JUNIOR SUBORDINATED NOTES UPON LIQUIDATION OF THE TRUST
As described under "Description of the Preferred Securities -- Special
Event Redemption or Distribution," Series C Junior Subordinated Notes may be
distributed to Holders in exchange for the Preferred Securities and in
liquidation of the Trust. Such a distribution would be treated as a non-taxable
event to each Holder and each Holder would receive an aggregate tax basis in the
Holder's Series C Junior Subordinated Notes equal to the Holder's aggregate tax
basis in its Preferred Securities. A Holder's holding period with respect to the
Series C Junior Subordinated Notes so received in liquidation of the Trust would
include the period for which the Preferred Securities were held by such Holder.
INFORMATION REPORTING TO HOLDERS
Income on the Preferred Securities will be reported to Holders on Form
1099, which form should be mailed to Holders of Preferred Securities by January
31 following each calendar year.
BACKUP WITHHOLDING
A Holder may be subject to "backup withholding" under certain
circumstances. Backup withholding applies to a Holder if the Holder, among other
things, (i) fails to furnish his social security number or other taxpayer
identification number ("TIN") to the payor responsible for backup withholding
(for example, the Holder's securities broker), (ii) furnishes such payor an
incorrect TIN, (iii) fails to provide such payor with a certified statement,
signed under penalties of perjury, that the TIN provided to the payor is correct
and that the Holder is not subject to backup withholding, or (iv) fails to
report properly interest and dividends on his tax return. Backup withholding,
however, does not apply to payments made
35
<PAGE>
to certain exempt recipients, such as corporations and tax-exempt organizations.
The backup withholding rate is 31% of "reportable payments," which generally
will include distributions of interest and principal payments on the Series C
Junior Subordinated Notes.
POSSIBLE TAX LAW CHANGES
On February 6, 1997, the revenue portion of President Clinton's fiscal 1998
budget proposal was released. The Proposal would, among other things, generally
deny interest deductions for interest on an instrument issued by a corporation
that has a maximum term of more than 15 years and that is not shown as
indebtedness on the separate balance sheet of the issuer. If the Proposal were
to apply to the Series C Junior Subordinated Notes, the Company would be unable
to deduct interest on the Series C Junior Subordinated Notes. As currently
drafted, however, the Proposal would be effective generally for instruments
issued on or after the date of first Congressional committee action and, as
such, is not expected to apply to the Series C Junior Subordinated Notes. The
Company believes that, under current law, it will be able to deduct interest on
the Series C Junior Subordinated Notes. There can be no assurance, however, that
current or future legislative proposals or final legislation will not affect the
ability of the Company to deduct interest on the Series C Junior Subordinated
Notes. Such a change could give rise to a Tax Event, which would permit the
Company to cause a redemption of the Preferred Securities, as described more
fully under "Description of the Preferred Securities -- Special Event Redemption
or Distribution."
THE FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE MAY NOT BE APPLICABLE TO
A HOLDER, DEPENDING UPON A HOLDER'S PARTICULAR SITUATION, AND THEREFORE EACH
HOLDER SHOULD CONSULT HIS TAX ADVISOR WITH RESPECT TO THE TAX CONSEQUENCES OF
THE OWNERSHIP AND DISPOSITION OF PREFERRED SECURITIES, INCLUDING THE TAX
CONSEQUENCES UNDER STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND THE POSSIBLE
EFFECTS OF CHANGES IN FEDERAL OR OTHER TAX LAW.
36
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in an underwriting agreement
(the "Underwriting Agreement"), the Trust has agreed to sell to the Underwriters
named below, and the Underwriters, for whom Goldman, Sachs & Co. is acting as
representative (the "Representative"), have severally agreed to purchase the
number of Preferred Securities set forth opposite their respective names below.
In the Underwriting Agreement, the Underwriters have agreed, subject to the
terms and conditions set forth therein, to purchase all of the Preferred
Securities offered hereby if any of the Preferred Securities are purchased.
<TABLE>
<CAPTION>
NUMBER OF
NAME PREFERRED SECURITIES
---- --------------------
<S> <C>
Goldman, Sachs & Co. .....................................
---------
Total........................................... 8,000,000
=========
</TABLE>
The Underwriters have advised the Company and the Trust that they propose
to offer the Preferred Securities in part directly to the public at the price to
the public, as set forth on the cover page of this Prospectus, and in part to
certain securities dealers at such price less a concession not in excess of
$. per Preferred Security. The Underwriters may allow, and such dealers
may reallow, a concession not in excess of $. per Preferred Security to
certain other dealers. After the Preferred Securities are released for sale to
the public, the offering price and other selling terms may from time to time be
varied by the Underwriters.
The Preferred Securities are expected to be approved for listing on the
NYSE, subject to official notice of issuance. Trading of the Preferred
Securities on the NYSE is expected to commence within a 30-day period after the
initial delivery of the Preferred Securities. The Representative has advised the
Company and the Trust that it intends to make a market in the Preferred
Securities prior to the commencement of trading on the NYSE. The Representative
will have no obligation to make a market in the Preferred Securities, however,
and may cease market making activities, if commenced, at any time.
Prior to this offering, there has been no public market for the Preferred
Securities. In order to meet one of the requirements for listing the Preferred
Securities on the NYSE, the Underwriters will undertake to sell lots of 100 or
more Preferred Securities to a minimum of 400 beneficial holders.
37
<PAGE>
In connection with this offering and in compliance with applicable law and
industry practice, the Underwriters may over allot or effect transactions which
stabilize, maintain or otherwise affect the market price of the Preferred
Securities at levels above those which might otherwise prevail in the open
market, including by entering stabilizing bids, purchasing Preferred Securities
to cover syndicate short positions and imposing penalty bids. A stabilizing bid
means the placing of any bid, or the effecting of any purchase, for the purpose
of pegging, fixing or maintaining the price of a security. Covering a syndicate
short position means placing a bid or effecting a purchase of a security on
behalf of the underwriting syndicate to reduce a short position created in
connection with the offering. Imposing a penalty bid means purchasing a security
in the open market to reduce the underwriting syndicate's short position or to
stabilize the price of the security and in connection therewith reclaiming the
amount of the selling concession from the underwriters and selling group members
who sold such securities as part of the offering.
In general, purchases of a security for the purpose of stabilization or to
reduce a syndicate short position could cause the price of the security to be
higher than it might be in the absence of such purchases. The imposition of a
penalty bid might also have an effect on the price of a security to the extent
that it were to discourage resales of the security.
Neither the Company, the Trust nor any Underwriter makes any representation
or prediction as to the direction or magnitude of any effect that the
transactions described above may have on the price of the Preferred Securities.
In addition, neither the Company, the Trust nor any Underwriter makes any
representation that the Underwriters will engage in such transactions or that
such transactions, once commenced, will not be discontinued without notice.
The Company and the Trust have agreed to indemnify the Underwriters against
certain liabilities, including liabilities under the 1933 Act.
Certain of the Underwriters engage in transactions with, and, from time to
time, have performed services for, the Company and its affiliates in the
ordinary course of business.
LEGAL OPINIONS
Certain matters of Delaware law relating to the validity of the Preferred
Securities will be passed upon on behalf of the Company and the Trust by
Richards, Layton & Finger, Wilmington, Delaware, special Delaware counsel to the
Company and the Trust. The validity of the Series C Junior Subordinated Notes,
the Guarantee and certain matters relating thereto, as well as certain matters
relating to United States federal income tax considerations, will be passed upon
on behalf of the Company by Troutman Sanders LLP, Atlanta, Georgia. Certain
legal matters will be passed upon for the Underwriters by Dewey Ballantine, New
York, New York.
EXPERTS
The financial statements and schedules of the Company included in the
Company's Annual Report on Form 10-K for the year ended December 31, 1996,
incorporated by reference in this Prospectus, have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their reports with
respect thereto, and are incorporated herein in reliance upon the authority of
said firm as experts in accounting and auditing in giving said reports. With
respect to the Company's unaudited interim financial information for the periods
ended March 31, 1997 and 1996 included in the Company's Quarterly Report on Form
10-Q for the quarter ended March 31, 1997 and incorporated by reference herein,
Arthur Andersen LLP has applied limited procedures in accordance with
professional standards for review of such information. However, their separate
report thereon states that they did not audit and they do not express an opinion
on such interim financial information. Accordingly, the degree of reliance on
their report on such information should be restricted in light of the limited
nature of the review procedures employed. In addition, the accountants are not
subject to the liability provisions of Section 11 of the 1933 Act for their
report on the unaudited interim financial information because this report is not
a "report" or
38
<PAGE>
"part" of the registration statement prepared or certified by the accountants
within the meaning of Sections 7 and 11 of said Act.
Statements as to matters of law and legal conclusions in the Company's
Annual Report on Form 10-K for the year ended December 31, 1996, relating to
titles to property of the Company under "Item 2 -- Properties -- Titles to
Property", and relating to the Company under "Item 1 -- Business -- Regulation",
"Item 1 -- Business -- Rate Matters" and "Item 1 -- Business -- Competition",
have been reviewed by Troutman Sanders LLP, general counsel for the Company, and
such statements are made upon the authority of such firm as experts.
39
<PAGE>
GLOSSARY
1933 Act................... The Securities Act of 1933, as amended.
1934 Act................... The Securities Exchange Act of 1934, as amended.
1939 Act................... The Trust Indenture Act of 1939, as amended.
1940 Act................... The Investment Company Act of 1940, as amended.
Additional Interest........ Amounts payable by the Company as defined under
"Description of the Series C Junior Subordinated
Notes -- Additional Interest."
Administrative Trustees.... Judy M. Anderson and Wayne Boston.
Agreement as to Expenses
and Liabilities.......... The agreement between the Company and the Trust
pursuant to which the Company has agreed to pay all
indebtedness, expenses or liabilities of the Trust,
other than the Trust's obligations to pay to the
holders of the Preferred Securities the amounts due
such holders pursuant to the terms thereof.
Code....................... The Internal Revenue Code of 1986, as amended.
Common Securities.......... The Trust Securities being sold to the Company.
Company.................... Georgia Power Company
Delaware Trustee........... Chase Manhattan Bank Delaware
DTC........................ The Depository Trust Company, a "clearing
corporation" that initially will hold (through its
agents) a global certificate evidencing the
Preferred Securities.
Distribution Dates......... March 31, June 30, September 30 and December 31 of
each year.
Extension Period........... Any period during which interest is not paid on the
Series C Junior Subordinated Notes (and,
consequently, on the Preferred Securities) at the
election of the Company to the extent permitted
under the terms of the Series C Junior Subordinated
Notes.
Guarantee.................. The guarantee by the Company of the payments by the
Trust on the Preferred Securities from funds
available in the Trust.
Guarantee Payments......... Payments required to be made pursuant to the
Guarantee as described in "Description of the
Guarantee -- General."
Guarantee Trustee.......... The trustee under the Guarantee; initially, The
Chase Manhattan Bank.
Indenture Trustee.......... The trustee under the Subordinated Note Indenture;
initially, The Chase Manhattan Bank.
Issue Date................. The date set forth on the cover page on which the
Series C Junior Subordinated Notes and Preferred
Securities are scheduled to be issued.
Investment Company
Act Event................ An event of the type described in "Description of
the Preferred Securities -- Special Event
Redemption or Distribution."
40
<PAGE>
Junior Subordinated
Notes.................... Unsecured junior subordinated debt securities of
the Company that may be issued in one or more
series pursuant to the Subordinated Note Indenture.
NYSE....................... New York Stock Exchange.
Preferred Securities....... The Trust Securities being offered to investors
pursuant to this Prospectus.
Property Trustee........... A trustee under the Trust designated to hold the
trust property; initially The Chase Manhattan Bank.
Record Date................ The close of business on the 15th calendar day
prior to a Distribution Date.
Redemption Price........... The stated liquidation amount of $25 per Preferred
Security, plus accrued and unpaid distributions
thereon (and interest thereon) to the date of
payment.
Securities Rate............ The per annum interest rate expressed as a
percentage of the stated liquidation amount of $25
per Preferred Security, and set forth on the cover
page of this Prospectus.
Securities Trustees........ The Property Trustee, Administrative Trustees and
Delaware Trustee.
Senior Indebtedness........ Indebtedness of the Company described under
"Description of the Series C Junior Subordinated
Notes -- Subordination."
Series C Junior
Subordinated Notes....... The Series C % junior subordinated deferrable
interest notes of the Company due ,
2037.
Special Event.............. A Tax Event or Investment Company Act Event.
Subordinated Note
Indenture................ The indenture pursuant to which the Company's
Series C Junior Subordinated Notes will be issued.
Subordinated Note Indenture
Event of Default......... As described under "Description of the Series C
Junior Subordinated Notes -- Events of Default."
Tax Event.................. An event of the type described in "Description of
the Preferred Securities -- Special Event
Redemption or Distribution."
Trust...................... Georgia Power Capital Trust III, a Delaware
business trust that will issue the Trust
Securities.
Trust Agreement............ The agreement pursuant to which the Trust is
organized as it may be amended and restated from
time to time.
Trust Agreement Event of
Default.................. As described under "Description of the Preferred
Securities -- Events of Default."
Trust Securities........... The Preferred Securities and the Common Securities.
41
<PAGE>
=========================================================
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER MADE
BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY, GEORGIA POWER
CAPITAL TRUST III OR THE UNDERWRITERS. NEITHER THE DELIVERY OF THIS PROSPECTUS
NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCE CREATE AN IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY OR GEORGIA POWER
CAPITAL TRUST III SINCE THE DATE HEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE AN
OFFER OR SOLICITATION BY ANYONE IN ANY STATE IN WHICH SUCH OFFER OR SOLICITATION
IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS
NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION.
------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information................... 3
Incorporation of Certain Documents by
Reference............................. 3
Selected Information.................... 4
The Offering............................ 6
Risk Factors............................ 9
Georgia Power Company................... 11
Georgia Power Capital Trust III......... 11
Accounting Treatment.................... 12
Use of Proceeds......................... 13
Recent Results of Operations............ 13
Description of the Preferred
Securities............................ 13
Description of the Guarantee............ 23
Description of the Series C Junior
Subordinated Notes.................... 25
Relationship Among the Preferred
Securities, the Series C Junior
Subordinated Notes and the
Guarantee............................. 32
Certain Federal Income Tax
Considerations........................ 33
Underwriting............................ 37
Legal Opinions.......................... 38
Experts................................. 38
Glossary................................ 40
</TABLE>
=========================================================
=========================================================
8,000,000 PREFERRED SECURITIES
GEORGIA POWER
CAPITAL TRUST III
% TRUST PREFERRED SECURITIES
(LIQUIDATION AMOUNT
$25 PER PREFERRED SECURITY)
FULLY AND UNCONDITIONALLY
GUARANTEED, AS SET FORTH HEREIN, BY
GEORGIA POWER
COMPANY
A SUBSIDIARY OF THE SOUTHERN COMPANY
------------------
PROSPECTUS
, 1997
------------------
GOLDMAN, SACHS & CO.
=========================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses of issuance and distribution, other than
underwriting discounts and commissions, to be borne by the Company are as
follows:
<TABLE>
<S> <C> <C>
Filing Fees -- Securities and Exchange
Commission -- registration statement...................... $ 60,607
Charges of trustees (including counsel)..................... *
Listing fees of New York Stock Exchange..................... *
Printing and preparation of registration statement,
prospectus, etc........................................... *
Rating fees --
Moody's Investors Service, Inc............................ *
Standard & Poor's Corporation............................. *
Duff and Phelps, Inc...................................... *
Services of Southern Company Services, Inc.................. *
Fees and expenses of counsel................................ *
Blue sky fees and expenses.................................. *
Fees of accountants, Arthur Andersen LLP.................... *
Miscellaneous, including telephone charges and traveling
expenses.................................................. *
--------
Total............................................. *
========
</TABLE>
- ---------------
* To be supplied by amendment.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The applicable statutes of the State of Georgia provide that a corporation
may indemnify or obligate itself to indemnify an individual made a party to a
proceeding because he is or was a director of the corporation or is or was
serving at the corporation's request as a director, officer, partner, trustee,
employee, or agent of another foreign or domestic corporation, partnership,
joint venture, trust, employee benefit plan, or another enterprise against
liability incurred in the proceeding if he acted in a manner he believed in good
faith to be in or not opposed to the best interest of the corporation and, in
the case of any criminal proceeding, he had no reasonable cause to believe his
conduct was unlawful. However, a corporation generally may not indemnify a
director in connection with a proceeding by or in the right of the corporation
in which the director was adjudged liable to the corporation, or in connection
with any other proceeding in which he was adjudged liable on the basis that
personal benefit was improperly received by him. In addition, unless limited by
its articles of incorporation, to the extent that a director has been
successful, on the merits or otherwise, in the defense of any proceeding to
which he was a party, or in defense of any claim, issue or matter therein,
because he is or was a director of the corporation, the corporation shall
indemnify the director against reasonable expenses incurred by him in connection
therewith. Also, unless a corporation's articles of incorporation provide
otherwise, an officer of the corporation who is not a director is entitled to
mandatory indemnification to the same extent as a director, and a corporation
may also indemnify an officer, employee or agent who is not a director to the
extent, consistent with public policy, that may be provided by its articles of
incorporation, by-laws, general or specific action of its board of directors, or
contract.
Section 41 of the By-laws of the Company provides in pertinent part as
follows:
Each person who is or was a director or officer of the Company or is
or was an employee of the Company holding one or more positions of
management through and inclusive of department managers (but not positions
below the level of department managers) (such positions being hereinafter
referred to as "Management Positions") and who was or is a party or was or
is
II-1
<PAGE>
threatened to be made a party to any threatened, pending or completed
claim, action, suit or proceeding, whether civil, criminal, administrative
or investigative, by reason of the fact that he is or was a director or
officer of the Company or is or was an employee of the Company holding one
or more Management Positions, or is or was serving at the request of the
Company as a director, officer, employee, agent or trustee of another
corporation, partnership, joint venture, trust, employee benefit plan or
other enterprise, shall be indemnified by the Company as a matter of right
against any and all expenses (including attorneys' fees) actually and
reasonably incurred by him and against any and all claims, judgments,
fines, penalties, liabilities and amounts paid in settlement actually
incurred by him in defense of such claim, action, suit or proceeding,
including appeals, to the full extent permitted by applicable law. The
indemnification provided by this Section shall inure to the benefit of the
heirs, executors and administrators of such person.
Expenses (including attorneys' fees) incurred by a director or officer
of the Company or employee of the Company holding one or more Management
Positions with respect to the defense of any such claim, action, suit or
proceeding may be advanced by the Company prior to the final disposition of
such claim, action, suit or proceeding, as authorized by the Board of
Directors in the specific case, upon receipt of an undertaking by or on
behalf of such person to repay such amount unless it shall ultimately be
determined that such person is entitled to be indemnified by the Company
under this Section or otherwise; provided, however, that the advancement of
such expenses shall not be deemed to be indemnification unless and until it
shall ultimately be determined that such person is entitled to be
indemnified by the Company.
The Company may purchase and maintain insurance at the expense of the
Company on behalf of any person who is or was a director, officer,
employee, or agent of the Company, or any person who is or was serving at
the request of the Company as director (or the equivalent), officer,
employee, agent or trustee of another corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise, against any
liability or expense (including attorneys' fees) asserted against him and
incurred by him in any such capacity, or arising out of his status as such,
whether or not the Company would have the power to indemnify him against
such liability or expense under this Section or otherwise.
Without limiting the generality of the foregoing provisions, no
present or future director or officer of the Company, or his heirs,
executors, or administrators, shall be liable for any act, omission, step,
or conduct taken or had in good faith, which is required, authorized, or
approved by any order or orders issued pursuant to the Public Utility
Holding Company Act of 1935, the Federal Power Act, or any federal or state
statute or municipal ordinance regulating the Company or its parent by
reason of their being holding or investment companies, public utility
companies, public utility holding companies, or subsidiaries of public
utility holding companies. In any action, suit, or proceeding based on any
act, omission, step, or conduct, as in this paragraph described, the
provisions hereof shall be brought to the attention of the court. In the
event that the foregoing provisions of this paragraph are found by the
court not to constitute a valid defense on the grounds of not being
applicable to the particular class of plaintiff, each such director and
officer, and his heirs, executors and administrators, shall be reimbursed
for, or indemnified against, all expenses and liabilities incurred by him
or imposed on him, in connection with, or arising out of, any such action,
suit, or proceeding based on any act, omission, step, or conduct taken or
had in good faith as in this paragraph described. Such expenses and
liabilities shall include, but shall not be limited to, judgments, court
costs, and attorneys' fees.
The foregoing rights shall not be exclusive of any other rights to
which any such director or officer or employee may otherwise be entitled
and shall be available whether or not the director or officer or employee
continues to be a director or officer or employee at the time of incurring
any such expenses and liabilities.
II-2
<PAGE>
The Company has an insurance policy covering its liabilities and expenses
which might arise in connection with its lawful indemnification of its directors
and officers for certain of their liabilities and expenses and also covering its
officers and directors against certain other liabilities and expenses.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER
-------
<C> <C> <S>
1.1 -- Form of Underwriting Agreement.*
4.1 -- Form of Subordinated Note Indenture between Georgia Power
Company and The Chase Manhattan Bank, as Trustee
(Designated in Registration No. 333-06037 as Exhibit 4.1).
4.2 -- Form of Supplemental Indenture to Subordinated Note
Indenture to be used in connection with the issuance of
Series C Junior Subordinated Notes (Designated in
Registration No. 333-06037 as Exhibit 4.2).
4.3-(a) -- Certificate of Trust of Georgia Power Capital Trust III
(Designated in Registration No. 333-06037 as Exhibit
4.3-C).
4.3-(b) -- Certificate of Amendment to Certificate of Trust of Georgia
Power Capital Trust III (Designated in Registration No.
333-06037 as Exhibit 4.3-C(1)).
4.4 -- Trust Agreement of Georgia Power Capital Trust III
(Designated in Registration No. 333-06037 as Exhibit
4.4-C).
4.5 -- Form of Amended and Restated Trust Agreement of Georgia
Power Capital Trust III (Designated in Registration No.
333-06037 as Exhibit 4.5-C).
4.6 -- Form of Preferred Security of Georgia Power Capital Trust
III (included in Exhibit 4.5 above).
4.7 -- Form of Junior Subordinated Note (included in Exhibit 4.2
above).
4.8 -- Form of Guarantee relating to Georgia Power Capital Trust
III (Designated in Registration No. 333-06037 as Exhibit
4.8-C).
4.9 -- Form of Agreement as to Expenses and Liabilities relating to
Georgia Power Capital Trust III (included in Exhibit 4.5
above).
5.1 -- Opinion of Troutman Sanders LLP relating to Georgia Power
Capital Trust III.*
5.2 -- Opinion of Richards, Layton & Finger relating to Georgia
Power Capital Trust III.*
8.1 -- Tax Opinion of Troutman Sanders LLP.*
12.1 -- Computation of ratio of earnings to fixed charges.
12.2 -- Computation of ratio of earnings to fixed charges plus
preferred dividend requirements (pre-income tax basis).
15.1 -- Letter re unaudited interim financial information.
23.1 -- Consent of Arthur Andersen LLP.
23.2 -- Consent of Troutman Sanders LLP (included in Exhibit 5.1
above).
23.3 -- Consent of Troutman Sanders LLP (included in Exhibit 8.1
above).
23.4 -- Consent of Richards, Layton & Finger (included in Exhibit
5.2 above).
24.1 -- Powers of Attorney and Resolution.
25.1 -- Statement of Eligibility under Trust Indenture Act of 1939,
as amended, of The Chase Manhattan Bank, as Indenture
Trustee.
25.2 -- Statement of Eligibility under Trust Indenture Act of 1939,
as amended, of The Chase Manhattan Bank, as Property
Trustee, relating to Georgia Power Capital Trust III.
25.3 -- Statement of Eligibility under Trust Indenture Act of 1939,
as amended, of The Chase Manhattan Bank, as Guarantee
Trustee, relating to Georgia Power Capital Trust III.
</TABLE>
Exhibits listed above which have heretofore been filed with the Commission
and which were designated as noted above are hereby incorporated herein by
reference and made a part hereof with the same effect as if filed herewith.
- ---------------
* To be subsequently filed or incorporated by reference.
II-3
<PAGE>
ITEM 17. UNDERTAKINGS.
(a) Undertaking related to filings incorporating subsequent Securities
Exchange Act of 1934 documents by reference:
The undersigned registrants hereby undertake that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the Company's annual report pursuant to Section 13(a) or Section 15(d) of
the Securities Exchange Act of 1934 that is incorporated by reference in
the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
(b) Undertaking related to acceleration of effectiveness:
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrants pursuant to the foregoing provisions
or otherwise, the registrants have been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than
the payment by the registrants of expenses incurred or paid by a director,
officer or controlling person of the registrants in the successful defense
of any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
registrants will, unless in the opinion of their counsel the matter has
been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
(c) The undersigned registrants hereby undertake that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the registrants pursuant to Rule 424(b)(1) or
497(h) under the Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-4
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, GEORGIA POWER
COMPANY CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF
THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF ATLANTA, STATE OF GEORGIA, ON THE 30TH DAY OF MAY,
1997.
GEORGIA POWER COMPANY
By: H. ALLEN FRANKLIN
President and Chief Executive
Officer
By: WAYNE BOSTON,
Attorney-in-fact
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, GEORGIA POWER
CAPITAL TRUST III CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT
MEETS ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS
REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO
DULY AUTHORIZED, IN THE CITY OF ATLANTA, STATE OF GEORGIA, ON THE 30TH DAY OF
MAY, 1997.
GEORGIA POWER CAPITAL TRUST III
By: GEORGIA POWER COMPANY,
Depositor
By: WAYNE BOSTON,
Assistant Secretary
II-5
<PAGE>
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING DIRECTORS AND OFFICERS
OF GEORGIA POWER COMPANY IN THE CAPACITIES AND ON THE DATE INDICATED.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
H. ALLEN FRANKLIN President, Chief Executive
Officer and Director
(Principal Executive
Officer)
WARREN Y. JOBE Executive Vice President,
Treasurer and Chief
Financial Officer and
Director (Principal
Financial Officer)
CLIFF S. THRASHER Vice President and Comptroller
(Principal Accounting
Officer)
BENNETT A. BROWN
WILLIAM A. FICKLING, JR.
L. G. HARDMAN III
JAMES R. LIENTZ, JR.
G. JOSEPH PRENDERGAST Directors
HERMAN J. RUSSELL
GLORIA M. SHATTO
WILLIAM JERRY VEREEN
CARL WARE
THOMAS R. WILLIAMS
BY WAYNE BOSTON May 30, 1997
(WAYNE BOSTON, ATTORNEY-IN-FACT)
</TABLE>
II-6
<PAGE>
Exhibit Index
EXHIBIT
NUMBER
-------
1.1 -- Form of Underwriting Agreement.*
4.1 -- Form of Subordinated Note Indenture between Georgia Power
Company and The Chase Manhattan Bank, as Trustee
(Designated in Registration No. 333-06037 as Exhibit 4.1).
4.2 -- Form of Supplemental Indenture to Subordinated Note
Indenture to be used in connection with the issuance of
Series C Junior Subordinated Notes (Designated in
Registration No. 333-06037 as Exhibit 4.2).
4.3-(a) -- Certificate of Trust of Georgia Power Capital Trust III
(Designated in Registration No. 333-06037 as Exhibit
4.3-C).
4.3-(b) -- Certificate of Amendment to Certificate of Trust of Georgia
Power Capital Trust III (Designated in Registration No.
333-06037 as Exhibit 4.3-C(1)).
4.4 -- Trust Agreement of Georgia Power Capital Trust III
(Designated in Registration No. 333-06037 as Exhibit
4.4-C).
4.5 -- Form of Amended and Restated Trust Agreement of Georgia
Power Capital Trust III (Designated in Registration No.
333-06037 as Exhibit 4.5-C).
4.6 -- Form of Preferred Security of Georgia Power Capital Trust
III (included in Exhibit 4.5 above).
4.7 -- Form of Junior Subordinated Note (included in Exhibit 4.2
above).
4.8 -- Form of Guarantee relating to Georgia Power Capital Trust
III (Designated in Registration No. 333-06037 as Exhibit
4.8-C).
4.9 -- Form of Agreement as to Expenses and Liabilities relating to
Georgia Power Capital Trust III (included in Exhibit 4.5
above).
5.1 -- Opinion of Troutman Sanders LLP relating to Georgia Power
Capital Trust III.*
5.2 -- Opinion of Richards, Layton & Finger relating to Georgia
Power Capital Trust III.*
8.1 -- Tax Opinion of Troutman Sanders LLP.*
12.1 -- Computation of ratio of earnings to fixed charges.
12.2 -- Computation of ratio of earnings to fixed charges plus
preferred dividend requirements (pre-income tax basis).
15.1 -- Letter re unaudited interim financial information.
23.1 -- Consent of Arthur Andersen LLP.
23.2 -- Consent of Troutman Sanders LLP (included in Exhibit 5.1
above).
23.3 -- Consent of Troutman Sanders LLP (included in Exhibit 8.1
above).
23.4 -- Consent of Richards, Layton & Finger (included in Exhibit
5.2 above).
24.1 -- Powers of Attorney and Resolution.
25.1 -- Statement of Eligibility under Trust Indenture Act of 1939,
as amended, of The Chase Manhattan Bank, as Indenture
Trustee.
25.2 -- Statement of Eligibility under Trust Indenture Act of 1939,
as amended, of The Chase Manhattan Bank, as Property
Trustee, relating to Georgia Power Capital Trust III.
25.3 -- Statement of Eligibility under Trust Indenture Act of 1939,
as amended, of The Chase Manhattan Bank, as Guarantee
Trustee, relating to Georgia Power Capital Trust III.
Exhibits listed above which have heretofore been filed with the Commission
and which were designated as noted above are hereby incorporated herein by
reference and made a part hereof with the same effect as if filed herewith.
- ---------------
* To be subsequently filed or incorporated by reference.
<PAGE>
<TABLE>
<CAPTION>
5/30/97
GEORGIA POWER COMPANY
Computation of ratio of earnings to fixed charges for the
the five years ended December 31, 1996
and the twelve months ended April 30, 1997
Twelve
Months
Ended
Year ended December 31, April 30,
==========================================================================
1992 1993 1994 1995 1996 1997
------------------------Thousands of Dollars------------------------------
EARNINGS AS DEFINED IN ITEM 503 OF REGULATION S-K:
<S> <C> <C> <C> <C> <C> <C>
Income Before Interest Charges $ 1,004,886 $1,034,795 $ 927,336 $ 959,692 $ 875,626 $ 856,896
Federal and state income taxes 165,667 266,771 360,380 411,675 383,668 397,548
Deferred income taxes, net 194,748 168,372 34,130 35,367 35,830 11,693
Deferred investment tax credits (5,704) (18,274) (489) 1,127 - -
AFUDC - Debt funds 8,459 8,294 11,613 12,123 11,452 11,482
------------ ------------ ------------ ------------ ----------- -----------
Earnings as defined $ 1,368,056 $1,459,958 $ 1,332,970 $ 1,419,984 $1,306,576 $1,277,619
============ ============ ============ ============ =========== ===========
FIXED CHARGES AS DEFINED IN ITEM 503 OF REGULATION S-K:
Interest on long-term debt $ 404,854 $345,552 $308,611 $257,092 $ 210,149 $ 204,120
Interest on interim obligations 9,694 15,530 17,529 21,463 15,478 13,080
Amort of debt disc, premium and expense, net 7,891 14,087 15,776 15,846 14,802 14,761
Other interest charges 12,426 47,393 23,483 20,400 21,296 28,529
------------ ------------ ------------ --------- ----------- -----------
Fixed charges as defined $ 434,865 $422,562 $365,399 $314,801 $ 261,725 $ 260,490
============ ============ ============ ========= =========== ===========
RATIO OF EARNINGS TO FIXED CHARGES 3.15 3.46 3.65 4.51 4.99 4.90
Note: The above figures have been adjusted to give effect to Georgia Power Company's 50% ownership of Southern
Electric Generating Company.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
5/30/97
GEORGIA POWER COMPANY
Computation of ratio of earnings to fixed charges plus preferred
dividend requirements for the five years ended December 31, 1996
and the twelve months ended April 30, 1997
Twelve
Months
Ended
April 30,
=============================================================================
1992 1993 1994 1995 1996 1997
-----------------------------------------Thousands of Dollars----------------
<S> <C> <C> <C> <C> <C> <C>
Income Before Interest Charges $ 1,004,886 $1,034,795 $ 927,336 $ 959,692 $ 875,626 $ 856,896
Federal and state income taxes 165,667 266,771 360,380 411,675 383,668 397,548
Deferred income taxes, net 194,748 168,372 34,130 35,367 35,830 11,693
Deferred investment tax credits (5,704) (18,274) (489) 1,127 - -
AFUDC - Debt funds 8,459 8,294 11,613 12,123 11,452 11,482
------------ ---------- ----------- ----------- ----------- -----------
Earnings as defined $ 1,368,056 $1,459,958 $1,332,970 $1,419,984 $1,306,576 $1,277,619
============ ========== =========== =========== =========== ===========
FIXED CHARGES AS DEFINED IN ITEM 503 OF REGULATION S-K:
Interest on long-term debt $ 404,854 345,552 $ 308,611 $ 257,092 $ 210,149 $204,120
Interest on interim obligations 9,694 15,530 17,529 21,463 15,478 13,080
Amort of debt disc, premium and expense, net 7,891 14,087 15,776 15,846 14,802 14,761
Other interest charges 12,426 47,393 23,483 20,400 21,296 28,529
---------- ----------- ---------- ---------- ----------- ---------
Fixed charges as defined 434,865 422,562 365,399 314,801 261,725 260,490
Tax deductible preferred dividends 1,804 1,753 1,753 1,753 1,753 1,753
---------- ----------- ---------- ---------- ----------- ---------
436,669 424,315 367,152 316,554 263,478 262,243
---------- ----------- ---------- ---------- ----------- ---------
Non-tax deductible preferred dividends 56,138 48,921 46,253 46,399 43,273 37,887
Ratio of net income before taxes to net income x 1.613 x 1.672 x 1.687 x 1.682 x 1.671 x 1.673
---------- ----------- ---------- ---------- ----------- ---------
Pref dividend requirements before income taxes 90,551 81,796 78,029 78,043 72,309 63,385
---------- ----------- ---------- ---------- ----------- ---------
Fixed charges plus pref dividend requirements $ 527,220 $506,111 $ 445,181 $ 394,597 $ 335,787 $325,628
========== =========== ========== ========== =========== =========
RATIO OF EARNINGS TO FIXED CHARGES PLUS
PREFERRED DIVIDEND REQUIREMENTS 2.59 2.88 2.99 3.60 3.89 3.92
Note: The above figures have been adjusted to give effect to Georgia
Power Company's 50% ownership of Southern Electric Generating
Company.
</TABLE>
EXHIBIT 15.1
Arthur Andersen LLP
May 30, 1997
Georgia Power Company
333 Piedmont Avenue, NE
Atlanta, GA 30308
Ladies and Gentlemen:
We are aware that Georgia Power Company has incorporated by reference in this
Registration Statement its quarterly report on Form 10-Q for the quarter ended
March 31, 1997, which includes our report on Georgia Power Company dated May 9,
1997, covering the unaudited interim financial information contained therein.
Pursuant to Regulation C of the Securities Act of 1933 (the "Act"), that report
is not considered a part of the Registration Statement prepared or certified by
our firm or a report prepared or certified by our firm within the meaning of
Sections 7 and 11 of the Act.
Very truly yours,
/s/Arthur Andersen LLP
EXHIBIT 23.1
Arthur Andersen LLP
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement on Form S-3 (relating to Georgia Power
Capital Trust III Preferred Securities, Georgia Power Company Junior
Subordinated Notes and Georgia Power Company Guarantee with respect to Preferred
Securities of Georgia Power Capital Trust III) of our reports on Georgia Power
Company dated February 12, 1997 included in Georgia Power Company's Form 10-K
for the year ended December 31, 1996 and to all references to our firm included
in this Registration Statement.
/s/Arthur Andersen LLP
Atlanta, Georgia
May 30, 1997
Exhibit 24.1
February 19, 1997
W. L. Westbrook, Warren Y. Jobe and Wayne Boston
Dear Sirs:
Georgia Power Company proposes to file with the Securities and Exchange
Commission a registration statement or statements under the Securities Act of
1933 with respect to preferred and capital securities of a statutory business
trust or trusts (or other special purpose entity or entities) and the related
guarantee or guarantees and debt instruments of Georgia Power Company in an
aggregate amount of up to $300 million.
Georgia Power Company and the undersigned directors and officers of
said Company, individually as a director and/or as an officer of the Company,
hereby make, constitute and appoint each of you our true and lawful Attorney
(with full power of substitution) for each of us and in each of our names,
places and steads to sign and cause to be filed with the Securities and Exchange
Commission the aforementioned registration statement or statements and
appropriate amendment or amendments thereto (including post-effective
amendments), to be accompanied in each case by a prospectus and any
appropriately amended prospectus or supplement thereto and any necessary
exhibits.
Georgia Power Company hereby authorizes you or any one of you to
execute said registration statement or statements and any amendments thereto
(including post-effective amendments) on its behalf as attorney-in-fact for it
and its authorized officers, and to file the same as aforesaid.
The undersigned directors and officers of Georgia Power Company hereby
authorize you or any one of you to sign said registration statement or
statements on their behalf as attorney-in-fact and to amend, or remedy any
deficiencies with respect to, said registration statement or statements by
appropriate amendment or amendments (including post-effective amendments) and to
file the same as aforesaid.
Yours very truly,
GEORGIA POWER COMPANY
By /s/H. Allen Franklin
H. Allen Franklin
President and
Chief Executive Officer
<PAGE>
/s/Bennett A. Brown /s/G. Joseph Prendergast
Bennett A. Brown G. Joseph Prendergast
______________________________ /s/Herman J. Russell
A. W. Dahlberg Herman J. Russell
/s/William A. Fickling, Jr. /s/Gloria M. Shatto
William A. Fickling, Jr. Gloria M. Shatto
/s/H. Allen Franklin /s/William Jerry Vereen
H. Allen Franklin William Jerry Vereen
/s/L. G. Hardman III /s/Carl Ware
L. G. Hardman III Carl Ware
/s/Warren Y. Jobe /s/Thomas R. Williams
Warren Y. Jobe Thomas R. Williams
/s/James R. Lientz, Jr. /s/Cliff S. Thrasher
James R. Lientz, Jr. Cliff S. Thrasher
______________________________ /s/Judy M. Anderson
William A. Parker, Jr. Judy M. Anderson
<PAGE>
- 3 -
Extract from minutes of meeting of the board of directors of Georgia Power
Company.
- - - - - - - - - - - -
RESOLVED: That for the purpose of signing and filing with the Securities
and Exchange Commission under the Securities Act of 1933, as amended, a
registration statement or statements covering up to an aggregate of $300,000,000
of preferred and capital securities of a statutory business trust or trusts (or
other special purpose entity or entities) and the related guarantee or
guarantees and debt instruments of Georgia Power Company, and of amending such
registration statement or statements or remedying any deficiencies with respect
thereto by appropriate amendment or amendments (including post-effective
amendments) to such registration statement or statements (both before and after
such statement or statements become effective), this Company, its officers and
the members of its Board of Directors are authorized to grant their several
powers of attorney to W. L. Westbrook, Warren Y. Jobe and Wayne Boston.
- - - - - - - - - - - -
The undersigned officer of Georgia Power Company does hereby certify
that the foregoing is a true and correct copy of a resolution duly and regularly
adopted at a meeting of the Board of Directors of Georgia Power Company, duly
held on February 19, 1997, at which a quorum was in attendance and voting
throughout, and that said resolution has not since been rescinded but is still
in full force and effect.
Dated May 30, 1997 GEORGIA POWER COMPANY
By /s/Wayne Boston
Wayne Boston
Assistant Secretary
Exhbit 25.1
-------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
----------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
---------------------------------------------
GEORGIA POWER COMPANY
(Exact name of obligor as specified in its charter)
Georgia 58-0257110
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
333 Piedmont Avenue, N.E.
Atlanta, Georgia 30308
(Address of principal executive offices) (Zip Code)
-------------------------------------------
Junior Subordinated Notes
(Title of the indenture securities)
-----------------------------------------------------
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject. New York State Banking Department, State
House, Albany, New York 12110. Board of Governors of the Federal
Reserve System, Washington, D.C., 20551 Federal Reserve Bank of
New York, District No. 2, 33 Liberty Street, New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 33-50010, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
Trustee, The Chase Manhattan Bank, a corporation organized and existing under
the laws of the State of New York, has duly caused this statement of eligibility
to be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of New York and State of New York, on the 28th day of May, 1997.
THE CHASE MANHATTAN BANK
By /s/ P. Morabito
P. Morabito
Vice President
- 3 -
Exhibit 25.2
___________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
_________________________
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
___________________________________________
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
________________________________________
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
_____________________________________________
GEORGIA POWER CAPITAL TRUST IV
(Exact name of obligor as specified in its charter)
Delaware Applied For
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
333 Piedmont Avenue, N.E.
Atlanta, Georgia 30308
(Address of principal executive offices) (Zip Code)
___________________________________________
Trust Preferred Securities
(Title of the indenture securities)
____________________________________________________
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject. New York State Banking Department, State
House, Albany, New York 12110. Board of Governors of the Federal
Reserve System, Washington, D.C., 20551 Federal Reserve Bank of
New York, District No. 2, 33 Liberty Street, New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991, and July 10, 1996 (see Exhibit 1 to Form
T-1 filed in connection with Registration Statement No. 33-50010, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
Trustee, The Chase Manhattan Bank, a corporation organized and existing under
the laws of the State of New York, has duly caused this statement of eligibility
to be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of New York and State of New York, on the 28th day of May, 1997.
THE CHASE MANHATTAN BANK
By /s/ P. Morabito
P. Morabito
Vice President
- 3 -
Exhbit 25.3
-------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
----------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
---------------------------------------------
GEORGIA POWER COMPANY
(Exact name of obligor as specified in its charter)
Georgia 58-0257110
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
333 Piedmont Avenue, N.E.
Atlanta, Georgia 30308
(Address of principal executive offices) (Zip Code)
-------------------------------------------
Trust Preferred Securities Guarantee
(Georgia Power Capital Trust III)
(Title of the indenture securities)
-----------------------------------------------------
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which
it is subject. New York State Banking Department, State House, Albany,
New York 12110. Board of Governors of the Federal Reserve System,
Washington, D.C., 20551 Federal Reserve Bank of New York, District No.
2, 33 Liberty Street, New York, N.Y. Federal Deposit Insurance
Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 33-50010, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
Trustee, The Chase Manhattan Bank, a corporation organized and existing under
the laws of the State of New York, has duly caused this statement of eligibility
to be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of New York and State of New York, on the 28th day of May, 1997.
THE CHASE MANHATTAN BANK
By /s/ P. Morabito
P. Morabito
Vice President
- 3 -
