Filed Pursuant to Rule 424(b)(5)
Registration Nos. 333-45069
333-45069-01
333-45069-02
PROSPECTUS SUPPLEMENT
(To Prospectus Dated February 9, 1998)
$100,000,000
Series C Floating Rate Senior Notes due March 28, 2002
------------------
Mississippi Power Company will pay interest on the Series C Senior Notes on
the 28th day of each month, beginning April 28, 2000. The per annum interest
rate on the Series C Senior Notes for each monthly interest period will be
reset monthly based on the one-month LIBOR rate plus 0.08%; however, under
certain circumstances set forth in this prospectus supplement, the interest
rate on the Series C Senior Notes will be determined without reference to
LIBOR.
The Series C Senior Notes are redeemable, in whole or in part, at the option
of Mississippi Power Company beginning on March 28, 2001 and on each interest
payment date thereafter at a redemption price equal to 100% of the principal
amount to be redeemed plus any accrued and unpaid interest to the date of
redemption.
The Series C Senior Notes will be direct, unsecured and unsubordinated
obligations ranking pari passu with all other unsecured and unsubordinated
obligations of Mississippi Power Company. The Series C Senior Notes will be
issued only in registered form in denominations of $1,000 and any integral
multiple thereof.
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<TABLE>
<CAPTION>
Per Note Total
-------- -----
<S> <C> <C>
Public Offering Price................................... 100.000% $100,000,000
Underwriting Discount................................... 0.029% $ 29,000
Proceeds, before expenses, to Mississippi Power
Company................................................ 99.971% $ 99,971,000
</TABLE>
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The public offering price set forth above does not include accrued interest,
if any. Interest on the Series C Senior Notes will accrue from the date the
Series C Senior Notes are issued.
------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if
this prospectus supplement or the accompanying prospectus is truthful or
complete. Any representation to the contrary is a criminal offense.
------------------
The Underwriter expects to deliver the Series C Senior Notes in book-entry
form only through The Depository Trust Company on or about March 28, 2000.
Salomon Smith Barney
The date of this Prospectus Supplement is March 22, 2000.
<PAGE>
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE SERIES C SENIOR NOTES
OFFERED HEREBY, INCLUDING OVER-ALLOTMENT AND SHORT-COVERING TRANSACTIONS IN
THE SERIES C SENIOR NOTES, AND THE IMPOSITION OF A PENALTY BID, IN CONNECTION
WITH THE OFFERING. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING."
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
Prospectus Supplement
<S> <C>
The Company.............................................................. S-3
Capitalization........................................................... S-3
Use of Proceeds.......................................................... S-3
Recent Results of Operations............................................. S-4
Description of the Series C Senior Notes................................. S-4
Experts.................................................................. S-8
Underwriting............................................................. S-8
Prospectus
Available Information.................................................... 2
Incorporation of Certain Documents by Reference.......................... 2
Selected Information..................................................... 3
Mississippi Power Company................................................ 4
The Trusts............................................................... 5
Accounting Treatment..................................................... 5
Use of Proceeds.......................................................... 5
Recent Results of Operations............................................. 5
Description of the Senior Notes.......................................... 6
Description of the Junior Subordinated Notes............................. 9
Description of the Preferred Securities.................................. 14
Description of the Guarantees............................................ 15
Relationship Among the Preferred Securities, the Junior Subordinated
Notes and the Guarantees................................................ 17
Plan of Distribution..................................................... 19
Legal Matters............................................................ 19
Experts.................................................................. 20
</TABLE>
S-2
<PAGE>
THE COMPANY
Mississippi Power Company (the "Company") was incorporated under the laws of
the State of Mississippi on July 12, 1972, was admitted to do business in
Alabama on November 28, 1972 and, effective December 21, 1972, by the merger
into it of the predecessor Mississippi Power Company, succeeded to the
business and properties of the latter company. The predecessor Mississippi
Power Company was incorporated under the laws of the State of Maine on
November 24, 1924 and was admitted to do business in Mississippi on December
23, 1924 and in Alabama on December 7, 1962. The Company has its principal
office at 2992 West Beach Boulevard, Gulfport, Mississippi 39501, telephone
number (228) 864-1211. The Company is a wholly owned subsidiary of The
Southern Company.
The Company is engaged in the generation and purchase of electric energy and
the distribution and sale of such energy within 23 counties of southeastern
Mississippi, at retail in 123 communities (including Biloxi, Gulfport,
Hattiesburg, Laurel, Meridian and Pascagoula), as well as in rural areas, and
at wholesale to one municipality, six rural electric distribution cooperative
associations and one generating and transmitting cooperative.
CAPITALIZATION
The following table sets forth the capitalization of the Company as of
December 31, 1999, and as adjusted to reflect the transactions described in
note (1) below. The following data is qualified in its entirety by reference
to and, therefore, should be read together with the detailed information and
financial statements appearing in the documents incorporated herein by
reference. See also "Selected Information" in the accompanying Prospectus.
<TABLE>
<CAPTION>
As of December
31, 1999
-----------------------
Actual As Adjusted(1)
-------- --------------
(Thousands, except
percentages)
<S> <C> <C> <C>
Common Stock Equity................................... $391,968 $391,968 47.2%
Cumulative Preferred Stock............................ 31,809 31,809 3.8
Company Obligated Mandatorily Redeemable Preferred
Securities of Subsidiary Trusts Holding Company
Junior Subordinated Notes............................ 35,000 35,000 4.2
Senior Notes.......................................... 89,564 189,356 22.8
Other Long-Term Debt.................................. 232,238 182,238 22.0
-------- -------- -----
Total, excluding amounts due within one year........ $780,579 $830,371 100.0%
======== ======== =====
</TABLE>
- --------
(1) Reflects (i) the redemption in February 2000 of $208,000 aggregate
principal amount of Series A 6.75% Senior Insured Quarterly Notes due June
30, 2038; and (ii) the sale of the Series C Senior Notes and the use of a
portion of the proceeds thereof to prepay $50,000,000 of bank loans. See
"Use of Proceeds."
USE OF PROCEEDS
A portion of the net proceeds from the sale of the Series C Senior Notes
will be applied by the Company to prepay bank loans in the amount of
$45,000,000 maturing in November 2001 and bearing interest at the one-month
London interbank offered rate plus 0.50% and $5,000,000 maturing in October
2002 and bearing interest at the one-month London interbank offered rate plus
0.30%. The balance of such proceeds will be used by the Company to repay a
portion of its outstanding short-term indebtedness, which aggregated
approximately $89,000,000 as of March 22, 2000.
S-3
<PAGE>
RECENT RESULTS OF OPERATIONS
For the year ended December 31, 1999, "Operating Revenues," "Earnings Before
Interest and Income Taxes" and "Net Income After Dividends on Preferred Stock"
were $633,004,000, $121,704,000 and $54,809,000, respectively. In the opinion
of the management of the Company, the above amounts for the year ended
December 31, 1999 reflect all adjustments (which were only normal recurring
adjustments) necessary to present fairly the results of operations for such
period. The "Ratios of Earnings to Fixed Charges" for the years ended December
31, 1998 and December 31, 1999 were 4.46 and 3.96, respectively.
DESCRIPTION OF THE SERIES C SENIOR NOTES
Set forth below is a description of the specific terms of the Series C
Floating Rate Senior Notes due March 28, 2002 (the "Series C Senior Notes").
This description supplements, and should be read together with, the
description of the general terms and provisions of the Senior Notes set forth
in the accompanying Prospectus under the caption "Description of the Senior
Notes." The following description does not purport to be complete and is
subject to, and is qualified in its entirety by reference to, the description
in the accompanying Prospectus and the Senior Note Indenture dated as of May
1, 1998 (the "Senior Note Indenture") between the Company and Bankers Trust
Company, as trustee (the "Senior Note Indenture Trustee").
General
The Series C Senior Notes will be issued as a series of Senior Notes under
the Senior Note Indenture. The Series C Senior Notes will be limited in
aggregate principal amount to $100,000,000.
The entire principal amount of the Series C Senior Notes will mature and
become due and payable, together with any accrued and unpaid interest thereon,
on March 28, 2002. The Series C Senior Notes are not subject to any sinking
fund provision. The Series C Senior Notes are available for purchase in
denominations of $1,000 and any integral multiple thereof.
Interest
Each Series C Senior Note shall bear interest from the date of original
issuance, payable monthly in arrears on the 28th day of each month to the
person in whose name such Series C Senior Note is registered at the close of
business on the 15th calendar day prior to such payment date. The initial
interest payment date is April 28, 2000. The amount of interest payable will
be computed on the basis of the actual number of days elapsed over a 360-day
year. If any interest payment date would otherwise be a day that is not a
Business Day, the interest payment date will be the next succeeding Business
Day.
The Series C Senior Notes will bear interest for each monthly Interest
Period at a per annum rate determined by the Calculation Agent, subject to the
maximum interest rate permitted by New York or other applicable state law, as
such law may be modified by United States law of general application. The
interest rate applicable during each monthly Interest Period will be equal to
LIBOR on the Interest Determination Date for such Interest Period plus 0.08%;
provided, however, that in certain circumstances described below, the interest
rate will be determined without reference to LIBOR. Promptly upon such
determination, the Calculation Agent will notify the Company and the Senior
Note Indenture Trustee, if the Senior Note Indenture Trustee is not then
serving as the Calculation Agent, of the interest rate for the new Interest
Period. The interest rate determined by the Calculation Agent, absent manifest
error, shall be binding and conclusive upon the beneficial owners and holders
of the Series C Senior Notes, the Company and the Senior Note Indenture
Trustee.
If the following circumstances exist on any Interest Determination Date, the
Calculation Agent shall determine the interest rate for the Series C Senior
Notes as follows:
(1) In the event no Reported Rate (as defined below) appears on Telerate
Page 3750 (as defined below) as of approximately 11:00 a.m., London time,
on an Interest Determination Date, the Calculation
S-4
<PAGE>
Agent shall request the principal London offices of each of four major
banks in the London interbank market selected by the Calculation Agent
(after consultation with the Company) to provide a quotation of the rate
(the "Rate Quotation") at which one month deposit in amounts of not less
than $1,000,000 are offered by it to prime banks in the London interbank
market, as of approximately 11:00 a.m., London time, on such Interest
Determination Date, that is representative of single transactions at such
time (the "Representative Amounts"). If at least two Rate Quotations are
provided, the interest rate will be the arithmetic mean of the Rate
Quotations obtained by the Calculation Agent, plus 0.08%.
(2) In the event no Reported Rate appears on Telerate Page 3750 as of
approximately 11:00 a.m., London time, on an Interest Determination Date
and there are fewer than two Rate Quotations, the interest rate will be the
arithmetic mean of the rates quoted at approximately 11:00 a.m., New York
City time, on such Interest Determination Date, by three major banks in New
York City selected by the Calculation Agent (after consultation with the
Company), for loans in Representative Amounts in U.S. dollars to leading
European banks, having an index maturity of one month for a period
commencing on the second London Business Day immediately following such
Interest Determination Date, plus 0.08%; provided, however, that if fewer
than three banks selected by the Calculation Agent are quoting such rates,
the interest rate for the applicable Interest Period will be the same as
the interest rate in effect for the immediately preceding Interest Period.
Upon the request of a holder of the Series C Senior Notes, the Calculation
Agent will provide to such holder the interest rate in effect on the date of
such request and, if determined, the interest rate for the next Interest
Period.
Certain Definitions
The following definitions apply to the Series C Senior Notes.
"Business Day" means a day other than (i) a Saturday or Sunday, (ii) a day
on which banks in New York, New York are authorized or obligated by law or
executive order to remain closed, or (iii) a day on which the Senior Note
Indenture Trustee's corporate trust office is closed for business.
"Calculation Agent" means Bankers Trust Company, or its successor appointed
by the Company, acting as calculation agent.
"Interest Determination Date" means the second London Business Day
immediately preceding the first day of the relevant Interest Period.
"Interest Period" means the period commencing on an interest payment date
for the Series C Senior Notes (or, with respect to the initial Interest Period
only, commencing on the issue date for the Series C Senior Notes) and ending
on the day before the next succeeding interest payment date for the Series C
Senior Notes.
"LIBOR" for any Interest Determination Date will be the offered rate for
deposits in U.S. dollars having an index maturity of one month for a period
commencing on the second London Business Day immediately following the
Interest Determination Date in amounts of not less than $1,000,000, as such
rate appears on Telerate Page 3750 or a successor reporter of such rates
selected by the Calculation Agent and acceptable to the Company, at
approximately 11:00 a.m., London time, on the Interest Determination Date (the
"Reported Rate").
"London Business Day" means a day that is a Business Day and a day on which
dealings in deposits in U.S. dollars are transacted, or with respect to any
future date are expected to be transacted, in the London interbank market.
"Telerate Page 3750" means the display designated on page 3750 on Bridge
Telerate, Inc. (or such other page as may replace the 3750 page on that
service or such other service as may be nominated by the British Bankers'
Association for the purpose of displaying London interbank offered rates for
U.S. dollar deposits).
Ranking
The Series C Senior Notes will be direct, unsecured and unsubordinated
obligations of the Company ranking pari passu with all other unsecured and
unsubordinated obligations of the Company. The Series C Senior Notes
S-5
<PAGE>
will be effectively subordinated to all secured debt of the Company, including
its first mortgage bonds, aggregating approximately $138,000,000 outstanding
at December 31, 1999. The Senior Note Indenture contains no restrictions on
the amount of additional indebtedness that may be incurred by the Company.
Optional Redemption
The Company shall have the right to redeem the Series C Senior Notes, in
whole or in part, without premium, from time to time, on any interest payment
date on or after March 28, 2001, upon not less than 30 nor more than 60 days'
notice, at a redemption price (the "Redemption Price") equal to 100% of the
principal amount to be redeemed plus any accrued and unpaid interest to the
date of redemption (the "Redemption Date").
If notice of redemption is given as aforesaid, the Series C Senior Notes so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price together with any accrued interest thereon, and from and
after such date (unless the Company shall default in the payment of the
Redemption Price and accrued interest) such Series C Senior Notes shall cease
to bear interest.
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 Series
C Senior Notes 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 Series C Senior Notes. The Series C Senior Notes will be
issued only as fully registered securities registered in the name of Cede &
Co., DTC's nominee. One or more fully registered global Series C Senior Notes
certificates will be issued, representing in the aggregate the total principal
amount of Series C Senior Notes, 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 Securities
Exchange Act of 1934, as amended. 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 New York Stock Exchange, Inc., 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 Securities and Exchange Commission.
Purchases of Series C Senior Notes within the DTC system must be made by or
through Direct Participants, which will receive a credit for the Series C
Senior Notes on DTC's records. The ownership interest of each actual purchaser
of Series C Senior Notes ("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
Series C Senior Notes. Transfers of ownership interests in the Series C Senior
Notes are to be
S-6
<PAGE>
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 Series C Senior Notes, except in the
event that use of the book-entry system for the Series C Senior Notes is
discontinued.
DTC has no knowledge of the actual Beneficial Owners of the Series C Senior
Notes. DTC's records reflect only the identity of the Direct Participants to
whose accounts such Series C Senior Notes 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.
Redemption notices shall be sent to DTC. If less than all of the Series C
Senior Notes are being redeemed, DTC will reduce the amount of the interest of
each Direct Participant in the Series C Senior Notes in accordance with its
procedures.
Although voting with respect to the Series C Senior Notes is limited, in
those cases where a vote is required, neither DTC nor Cede & Co. will itself
consent or vote with respect to Series C Senior Notes. Under its usual
procedures, DTC would mail an Omnibus Proxy to the Company 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 Series C
Senior Notes are credited on the record date (identified in a listing attached
to the Omnibus Proxy).
Payments on the Series C Senior Notes 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 or the Company, subject to
any statutory or regulatory requirements as may be in effect from time to
time. Payment to DTC is the responsibility of the Company, 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 of a global Series C Senior
Note will not be entitled to receive physical delivery of Series C Senior
Notes. Accordingly, each Beneficial Owner must rely on the procedures of DTC
to exercise any rights under the Series C Senior Notes. 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 Series C Senior Note.
DTC may discontinue providing its services as securities depositary with
respect to the Series C Senior Notes at any time by giving reasonable notice
to the Company. Under such circumstances, in the event that a successor
securities depositary is not obtained, Series C Senior Notes 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 Series C Senior Notes. In
that event, certificates for the Series C Senior Notes 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 believes to be reliable, but
the Company takes no responsibility for the accuracy thereof. The Company 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.
S-7
<PAGE>
EXPERTS
The financial statements of the Company included in the Company's Current
Report on Form 8-K dated February 16, 2000, incorporated by reference herein,
have been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their report with respect thereto, and are incorporated herein in
reliance upon the authority of said firm as experts in accounting and auditing
in giving said report.
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, 1998, 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 Eaton and Cottrell, P.A., general counsel for the Company, and such
statements are made upon the authority of such firm as experts.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement
dated the date hereof, the Company has agreed to sell to Salomon Smith Barney
Inc. (the "Underwriter") and the Underwriter has agreed to purchase
$100,000,000 aggregate principal amount of Series C Senior Notes.
The Underwriting Agreement provides that the obligations of the Underwriter
to pay for and accept delivery of the Series C Senior Notes are subject to,
among other things, the approval of certain legal matters by its counsel and
certain other conditions. The Underwriter is obligated to take and pay for all
the Series C Senior Notes if any are taken.
The Underwriter proposes initially to offer all or part of the Series C
Senior Notes to the public at the public offering price set forth on the cover
page of this Prospectus Supplement and to certain dealers at such price less a
concession not in excess of 0.009% of the principal amount of the Series C
Senior Notes. After the initial public offering, the public offering price and
concession may be changed.
The underwriting discount to be paid to the Underwriter by the Company with
this offering will be 0.029% per Series C Senior Note, for a total of $29,000.
In addition, the Company estimates that it will incur other offering expenses
of approximately $160,000.
In order to facilitate the offering of the Series C Senior Notes, the
Underwriter or its affiliates may engage in transactions that stabilize,
maintain or otherwise affect the price of the Series C Senior Notes.
Specifically, the Underwriter or its affiliates may over-allot in connection
with this offering, creating short positions in the Series C Senior Notes for
their own account. In addition, to cover over-allotments or to stabilize the
price of the Series C Senior Notes, the Underwriter or its affiliates may bid
for, and purchase Series C Senior Notes in the open market. Finally, the
Underwriter or its affiliates may reclaim selling concessions allowed to a
dealer for distributing Series C Senior Notes in this offering, if the
Underwriter or its affiliates repurchase previously distributed Series C Senior
Notes in transactions that cover syndicate short positions, in stabilization
transactions or otherwise. Any of these activities may stabilize or maintain
the market price of the Series C Senior Notes above independent market levels.
The Underwriter or its affiliates are not required to engage in these
activities, and may end any of these activities at any time.
Neither the Company nor the 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 Series C
S-8
<PAGE>
Senior Notes. In addition, neither the Company nor the Underwriter makes any
representation that such transactions will be engaged in or that such
transactions, once commenced, will not be discontinued without notice.
The Company has agreed to indemnify the Underwriter against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended.
The Underwriter and its affiliates engage in transactions with and perform
services for the Company in the ordinary course of business and have engaged,
and may in the future engage, in commercial banking and/or investment banking
transactions with the Company or its affiliates.
The Series C Senior Notes will not have an established trading market when
issued. There can be no assurance of a secondary market for the Series C
Senior Notes or the continued liquidity of such market if one develops. It is
not anticipated that the Series C Senior Notes will be listed on any
securities exchange.
S-9
<PAGE>
$100,000,000
GULF POWER COMPANY APPEARS HERE
Series C Floating Rate Senior Notes
due March 28, 2002
------------------
Prospectus Supplement
Dated March 22, 2000
------------------
Salomon Smith Barney
