As filed with the Securities and Exchange Commission on March 31, 1995
Registration No. ________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
THE SOUTHERN COMPANY
(Exact name of registrant as specified in its charter)
Delaware 58-0690070
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) No.)
64 Perimeter Center East 30346
Atlanta, Georgia (Zip Code)
(Address of principal executive
offices)
SOUTHERN ELECTRIC INTERNATIONAL, INC.
SAVINGS PLAN FOR COVERED EMPLOYEES
(Full title of the plan)
TOMMY CHISHOLM, Secretary
THE SOUTHERN COMPANY
64 Perimeter Center East
Atlanta, Georgia 30346
(Name and address of agent for service)
404-668-3575
(Telephone number, including area code, of agent for service)
The Commission is requested to mail signed copies of all orders, notices
and communications to:
W. L. WESTBROOK JOHN D. McLANAHAN
Financial Vice President TROUTMAN SANDERS
THE SOUTHERN COMPANY 600 Peachtree Street, N.E.
64 Perimeter Center East Suite 5200
Atlanta, Georgia 30346 Atlanta, Georgia 30308-2216
CALCULATION OF REGISTRATION FEE
Title of Amount to be Proposed Proposed Amount of
securities to registered maximum maximum registration
be registered offering aggregate fee
price per offering
unit* price*
Common Stock, 200,000 $4,025,000 $20 1/8 $1,388
par value $5 shares
per share
In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
registration statement also covers an indeterminate amount of interests to
be offered or sold pursuant to the employee benefit plan described herein.
_________________
* Pursuant to Rule 457 (h)(1), these figures are based upon the average
of the high and low prices of the Common Stock on March 29, 1995, as
reported in the New York Stock Exchange consolidated reporting system,
and are used solely for the purpose of calculating the registration
fee.
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PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The documents listed below are incorporated by reference in
this registration statement; and all documents subsequently
filed by The Southern Company ("SOUTHERN" or the
"registrant") or the Southern Electric International, Inc.
Savings Plan for Covered Employees (the "Plan") pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, prior to the filing of a
post-effective amendment which indicates that all securities
offered have been sold or which deregisters all securities
then remaining unsold, shall be deemed to be incorporated by
reference in this registration statement and to be a part
hereof from the date of filing of such documents.
(a) The registrant's Annual Report on Form 10-K for the
year ended December 31, 1994.
(b) The registrant's Current Reports on Form 8-K dated
January 25, 1995 and February 15, 1995.
(c) The description of the registrant's common stock
contained in registration no. 33-51433 filed under the
Securities Act of 1933.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
None.
Item 6. Indemnification of Directors and Officers.
Section 145 of Title 8 of the Delaware Code gives a
corporation power to indemnify any person who was or is a
party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (other than
an action by or in the right of the corporation) by reason
of the fact that he is or was a director, officer, employee
or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture,
trust or other enterprise, against expenses (including
attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be
in or not opposed to the best interests of the corporation,
and, with respect to any criminal action or proceeding, had
no reasonable cause to believe his conduct was unlawful.
The same Section also gives a corporation power to indemnify
any person who was or is a party or is threatened to be made
a party to any threatened, pending or completed action or
suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that he is or
was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the
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corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or
other enterprise against expenses (including attorneys'
fees) actually and reasonably incurred by him in connection
with the defense or settlement of such action or suit if he
acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made
in respect of any claim, issue or matter as to which such
person shall have been adjudged to be liable to the
corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was
brought shall determine upon application that, despite the
adjudication of liability but in view of all the
circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the
Court of Chancery or such other court shall deem proper.
Also, the Section states that, to the extent that a
director, officer, employee or agent of a corporation has
been successful on the merits or otherwise in defense of any
such action, suit or proceeding, or in defense of any claim,
issue or matter herein, he shall be indemnified against
expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
The Bylaws of SOUTHERN provide in substance that no present
or future director or officer of SOUTHERN shall be liable
for any act, omission, step or conduct taken or had in good
faith which is required, authorized or approved by order
issued pursuant to the Public Utility Holding Company Act of
1935, the Federal Power Act, or any state statute regulating
SOUTHERN or its subsidiaries by reason of their being public
utility companies or public utility holding companies, or
any amendment to any thereof. In the event that such
provisions are found by a court not to constitute a valid
defense, each such director and officer 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 such Bylaws described.
The Bylaws of SOUTHERN also provide in pertinent part as
follows:
"Each person who is or was a director or officer of the
Corporation and who was or is a party or was or is
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
Corporation, or is or was serving at the request of the
Corporation 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 Corporation 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
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benefit of the heirs, executors and administrators of such
person.
Expenses (including attorneys' fees) incurred by a director
or officer of the Corporation with respect to the defense of
any such claim, action, suit or proceeding may be advanced
by the Corporation 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 Corporation
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 Corporation.
The Corporation may purchase and maintain insurance at the
expense of the Corporation on behalf of any person who is or
was a director, officer, employee or agent of the
Corporation, or any person who is or was serving at the
request of the Corporation as a 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 Corporation would have
the power to indemnify him against such liability or expense
under this Section or otherwise.
The foregoing rights shall not be exclusive of any other
rights to which any such director or officer may otherwise
be entitled and shall be available whether or not the
director or officer continues to be a director or officer at
the time of incurring any such expenses and liabilities."
SOUTHERN 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 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibit
Number
4(a) - Composite Certificate of Incorporation of SOUTHERN
reflecting all amendments to date. (Designated in
Registration No. 33-3546 as Exhibit 4(a), in
Certificate of Notification, File No. 70-7341, as
Exhibit A and in Certificate of Notification, File
No. 70-8181, as Exhibit A.)
4(b) - Bylaws of SOUTHERN as amended effective October 21,
1991 and presently in effect. (Designated in Form
U-1, File No. 70-8181, as Exhibit A-2.)
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4(c) - Southern Electric International, Inc. Savings Plan
For Covered Employees.
5 - Opinion of Troutman Sanders, counsel to SOUTHERN.
23(a) - The consent of Troutman Sanders is contained in
Exhibit 5.
23(b) - Consent of Arthur Andersen LLP.
24 - Powers of Attorney and resolution.
Exhibits listed above which have heretofore been filed with
the Securities and Exchange 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.
Item 9. Undertakings.
(a) Rule 415 offerings. The undersigned registrant hereby
undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this
registration statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of
the registration statement (or the most
recent post-effective amendment thereof)
which, individually or in the aggregate,
represent a fundamental change in the
information set forth in the registration
statement;
(iii) To include any material information with
respect to the plan of distribution not
previously disclosed in the registration
statement or any material change to such
information in the registration statement;
Provided, however, that paragraphs (a)(1)(i)
and (a)(1)(ii) do not apply if the
information required to be included in a
post-effective amendment by those paragraphs
is contained in periodic reports filed by the
registrant pursuant to Section 13 or Section
15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-
effective amendment shall be deemed to be a new
registration statement relating to the securities
offered therein, and the offering of such
securities at that time shall be deemed to be the
initial bona fide offering thereof.
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(3) To remove from registration by means of a
post-effective amendment any of the securities being
registered which remain unsold at the termination
of the offering.
(b) Filings incorporating subsequent Exchange Act documents
by reference. The undersigned registrant hereby
undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing
of the registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Securities Exchange Act
of 1934 (and each filing of the Plan's annual report
pursuant to 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.
(c) Filing of registration statement on Form S-8. Insofar
as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and
is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities
(other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of
any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection
with the securities being registered, the registrant
will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as
expressed in the Act and will be governed by the final
adjudication of such issue.
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SIGNATURES
The Registrant. Pursuant to the requirements of the
Securities Act of 1933, the registrant certifies that it has
reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 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 March 31, 1995.
THE SOUTHERN COMPANY
By: A.W. Dahlberg
Chairman, President and
Chief Executive Officer
By: /s/Wayne Boston
Wayne Boston
Attorney-in-Fact
Pursuant to the requirements of the Securities Act of 1933,
this registration statement has been signed by the following
persons in the capacities and on the date indicated.
SIGNATURE TITLE DATE
A.W. Dahlberg Chairman of the Board, President
and Chief Executive Officer
(Principal Executive Officer)
W. L. Westbrook Financial Vice President (Principal
Financial and Accounting Officer)
W.P. Copenhaver )
A. D. Correll )
Paul J. DeNicola )
Jack Edwards )
H. Allen Franklin )
Bruce S. Gordon )
L.G. Hardman III ) Directors
Elmer B. Harris )
Earl D. McLean, Jr. )
William J. Rushton, III )
Herbert Stockham )
By: /s/Wayne Boston March 31, 1995
Wayne Boston
Attorney-in-Fact
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The Plan. Pursuant to the requirements of the Securities
Act of 1933, the trustees (or other persons who administer the
employee benefit plan) have 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 March 31, 1995.
SOUTHERN ELECTRIC INTERNATIONAL, INC.
SAVINGS PLAN FOR COVERED EMPLOYEES
By: /s/Raymond D. Hill
Raymond D. Hill
Chairman, Southern Electric International, Inc.
Savings Plan For Covered Employees Committee
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Exhibit 4(c)
SOUTHERN ELECTRIC INTERNATIONAL, INC.
SAVINGS PLAN FOR COVERED EMPLOYEES
Effective April 1, 1995
<PAGE>
TABLE OF CONTENTS
ARTICLE I PURPOSE . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . 2
2.1 "Account" . . . . . . . . . . . . . . . . . . 2
2.2 "Actual Deferral Percentage" . . . . . . . . . 2
2.3 "Actual Deferral Percentage Test" . . . . . . 2
2.4 "Affiliated Employer" . . . . . . . . . . . . 2
2.5 "Annual Addition" . . . . . . . . . . . . . . 3
2.6 "Average Actual Deferral Percentage" . . . . . 3
2.7 "Beneficiary" . . . . . . . . . . . . . . . . 3
2.8 "Board of Directors" . . . . . . . . . . . . . 3
2.9 "Break-in-Service Date" . . . . . . . . . . . 3
2.10 "Code" . . . . . . . . . . . . . . . . . . . . 3
2.11 "Common Stock" . . . . . . . . . . . . . . . . 3
2.12 "Company" . . . . . . . . . . . . . . . . . . 4
2.13 "Compensation" . . . . . . . . . . . . . . . . 4
2.14 "Defined Benefit Plan Fraction" . . . . . . . 4
2.15 "Defined Contribution Plan Fraction" . . . . 5
2.16 "Determination Year" . . . . . . . . . . . . 5
2.17 "Distributee" . . . . . . . . . . . . . . . . 5
2.18 "Direct Rollover" . . . . . . . . . . . . . . 5
2.19 "Elective Employer Contribution" . . . . . . . 5
2.20 "Eligible Employee" . . . . . . . . . . . . . 5
2.21 "Eligible Participant" . . . . . . . . . . . 6
2.22 "Eligible Retirement Plan" . . . . . . . . . 6
2.23 "Eligible Rollover Distribution" . . . . . . 6
2.24 "Employee" . . . . . . . . . . . . . . . . . . 6
2.25 "Employer Matching Contribution" . . . . . . . 6
2.26 "Enrollment Date" . . . . . . . . . . . . . . 6
2.27 "ERISA" . . . . . . . . . . . . . . . . . . . 6
2.28 "Excess Deferral Amount" . . . . . . . . . . 6
2.29 "Excess Deferral Contributions" . . . . . . . 7
2.30 "Family Member" . . . . . . . . . . . . . . . 7
2.31 "Highly Compensated Employee" . . . . . . . . 7
2.32 "Hour of Service" . . . . . . . . . . . . . . 8
2.33 "Investment Fund" . . . . . . . . . . . . . . 8
2.34 "Limitation Year" . . . . . . . . . . . . . . 8
2.35 "Look-Back Year" . . . . . . . . . . . . . . 8
2.36 "Non-Highly Compensated Employee" . . . . . . 8
2.37 "Normal Retirement Date" . . . . . . . . . . . 8
2.38 "One-Year Break in Service" . . . . . . . . . 8
2.39 "Participant" . . . . . . . . . . . . . . . . 9
2.40 "Plan" . . . . . . . . . . . . . . . . . . . . 9
2.41 "Benefit Plan Administration Committee" . . . 9
2.42 "Plan Year" . . . . . . . . . . . . . . . . . 9
2.43 "Surviving Spouse" . . . . . . . . . . . . . 9
2.44 "Trust" or "Trust Fund" . . . . . . . . . . . 9
2.45 "Trust Agreement" . . . . . . . . . . . . . . 9
2.46 "Trustee" . . . . . . . . . . . . . . . . . . 9
2.47 "Valuation Date" . . . . . . . . . . . . . . . 9
2.48 "Voluntary Participant Contribution" . . . . . 9
2.49 "Year of Service" . . . . . . . . . . . . . . 9
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ARTICLE III PARTICIPATION . . . . . . . . . . . . . . . . . . . . . 11
3.1 Eligibility Requirements . . . . . . . . . . . 11
3.2 Participation upon Reemployment . . . . . . . 11
3.3 No Restoration of Previously Distributed
Benefits . . . . . . . . . . . . . . . . . . . 11
3.4 Loss of Eligible Employee Status . . . . . . . 12
3.5 Special Rules for Scott Paper Company Energy
Complex Employees. . . . . . . . . . . . . . . 12
ARTICLE IV ELECTIVE EMPLOYER CONTRIBUTIONS AND
VOLUNTARY PARTICIPANT CONTRIBUTIONS . . . . . . . . . . 13
4.1 Elective Employer Contributions . . . . . . . 13
4.2 Maximum Amount of Elective Employer
Contributions . . . . . . . . . . . . . . . . 13
4.3 Distribution of Excess Deferral Amounts . . . 13
4.4 Additional Rules Regarding Elective Employer
Contributions . . . . . . . . . . . . . . . . 14
4.5 Section 401(k) Nondiscrimination Tests. . . . 15
4.6 Voluntary Participant Contributions. . . . . 19
4.7 Manner and Time of Payment of Elective
Employer Contributions and Voluntary
Participant Contributions . . . . . . . . . . 20
4.8 Change in Contribution Rate . . . . . . . . . 20
4.9 Change in Contribution Amount . . . . . . . . 20
ARTICLE V EMPLOYER MATCHING CONTRIBUTIONS . . . . . . . . . . . . 21
5.1 Amount of Employer Matching Contributions . . 21
5.2 Investment of Employer Matching
Contributions . . . . . . . . . . . . . . . . 21
5.3 Payment of Employer Matching Contributions . . 21
5.4 Reversion of Company Contributions . . . . . . 21
5.5 Correction of Prior Incorrect Allocations and
Distributions . . . . . . . . . . . . . . . . 22
ARTICLE VI LIMITATIONS ON CONTRIBUTIONS . . . . . . . . . . . . . . 23
6.1 Section 415 Limitations . . . . . . . . . . . 23
6.2 Correction of Contributions in Excess of
Section 415 Limits . . . . . . . . . . . . . . 23
6.3 Combination of Plans . . . . . . . . . . . . . 24
ARTICLE VII SUSPENSION OF CONTRIBUTIONS . . . . . . . . . . . . . . 25
7.1 Suspension of Contributions . . . . . . . . . 25
7.2 Resumption of Contributions . . . . . . . . . 25
ARTICLE VIII INVESTMENT OF PARTICIPANTS' CONTRIBUTIONS . . . . . . . 26
8.1 Investment Funds . . . . . . . . . . . . . . . 26
8.2 Investment of Participant Contributions . . . 26
8.3 Investment of Earnings . . . . . . . . . . . . 27
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8.4 Transfer of Assets between Funds . . . . . . . 27
8.5 Change in Investment Direction . . . . . . . . 27
ARTICLE IX MAINTENANCE AND VALUATION OF PARTICIPANTS' ACCOUNTS . . 28
9.1 Establishment of Accounts . . . . . . . . . . 28
9.2 Valuation of Investment Funds . . . . . . . . 28
9.3 Rights in Investment Funds . . . . . . . . . . 28
ARTICLE X VESTING . . . . . . . . . . . . . . . . . . . . . . . . 29
10.1 Vesting . . . . . . . . . . . . . . . . . . . 29
ARTICLE XI WITHDRAWALS AND LOANS PRIOR TO TERMINATION OF EMPLOYMENT 30
11.1 Withdrawals by Participants . . . . . . . . . 30
11.2 Notice of Withdrawal . . . . . . . . . . . . . 30
11.3 Form of Withdrawal . . . . . . . . . . . . . . 31
11.4 Minimum Withdrawal . . . . . . . . . . . . . . 31
11.5 Source of Withdrawal . . . . . . . . . . . . . 31
11.6 Requirement of Hardship . . . . . . . . . . . 31
11.7 Loans to Participants . . . . . . . . . . . . 33
ARTICLE XII DISTRIBUTION TO PARTICIPANTS . . . . . . . . . . . . . . 36
12.1 Distribution upon Retirement . . . . . . . . . 36
12.2 Distribution upon Disability . . . . . . . . . 37
12.3 Distribution upon Death . . . . . . . . . . . 37
12.4 Designation of Beneficiary in the Event of
Death . . . . . . . . . . . . . . . . . . . . 38
12.5 Distribution upon Termination of Employment . 39
12.6 Commencement of Benefits . . . . . . . . . . . 39
12.7 Transfer to an Affiliated Employer . . . . . . 40
12.8 Distributions to Alternate Payees . . . . . . 40
12.9 Requirement for Direct Rollovers . . . . . . . 40
12.10 Consent and Notice Requirements . . . . . . . 41
ARTICLE XIII ADMINISTRATION OF THE PLAN . . . . . . . . . . . . . . . 42
13.1 Membership of Benefit Plan Administration
Committee . . . . . . . . . . . . . . . . . . 42
13.2 Acceptance and Resignation . . . . . . . . . . 42
13.3 Transaction of Business . . . . . . . . . . . 42
13.4 Responsibilities in General . . . . . . . . . 42
13.5 Benefit Plan Administration Committee as
Named Fiduciary . . . . . . . . . . . . . . . 42
13.6 Rules for Plan Administration . . . . . . . . 43
13.7 Employment of Agents . . . . . . . . . . . . . 43
13.8 Co-Fiduciaries . . . . . . . . . . . . . . . . 43
13.9 General Records . . . . . . . . . . . . . . . 43
13.10 Liability of the Plan Administration
Committee . . . . . . . . . . . . . . . . . . 44
13.11 Reimbursement of Expenses and Compensation
of Benefit Plan Administration Committee . . 44
13.12 Expenses of Plan and Trust Fund . . . . . . . 44
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13.13 Responsibility for Funding Policy . . . . . . 45
13.14 Management of Assets . . . . . . . . . . . . 45
13.15 Notice and Claims Procedures . . . . . . . . 45
13.16 Bonding . . . . . . . . . . . . . . . . . . . 45
13.17 Multiple Fiduciary Capacities . . . . . . . . 45
ARTICLE XIV TRUSTEE OF THE PLAN . . . . . . . . . . . . . . . . . . 46
14.1 Trustee . . . . . . . . . . . . . . . . . . . 46
14.2 Purchase of Common Stock . . . . . . . . . . . 46
14.3 Voting of Common Stock . . . . . . . . . . . . 47
14.4 Voting of Capital Fund Shares . . . . . . . . 47
14.5 Voting of Equity Index Trust Shares . . . . . 47
14.6 Uninvested Amounts . . . . . . . . . . . . . . 47
14.7 Independent Accounting . . . . . . . . . . . . 47
ARTICLE XV AMENDMENT AND TERMINATION OF THE PLAN . . . . . . . . . 48
15.1 Amendment of the Plan . . . . . . . . . . . . 48
15.2 Termination of the Plan . . . . . . . . . . . 48
15.3 Merger or Consolidation of the Plan . . . . . 49
ARTICLE XVII GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . 50
16.1 Plan Not an Employment Contract . . . . . . . 50
16.2 No Right of Assignment or Alienation . . . . . 50
16.3 Payment to Minors and Others . . . . . . . . . 51
16.4 Source of Benefits . . . . . . . . . . . . . . 51
16.5 Unclaimed Benefits . . . . . . . . . . . . . . 51
16.6 Governing Law. . . . . . . . . . . . . . . . 51
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SOUTHERN ELECTRIC INTERNATIONAL, INC.
SAVINGS PLAN FOR COVERED EMPLOYEES
Effective April 1, 1995
ARTICLE I
PURPOSE
The purpose of the Plan is to encourage employee thrift, to
create added employee interest in the affairs of Southern
Electric International, Inc. ("Company") and The Southern
Company, to provide a means for becoming a shareholder in The
Southern Company, to supplement retirement and death benefits,
and to create a competitive compensation program for employees
through the establishment of a formal plan under which
contributions by and on behalf of Participants are supplemented
by contributions of the Company. The Company is the plan sponsor
of the Plan. This Plan is intended to be a stock bonus plan, and
all contributions made by the Company to this Plan are expressly
conditioned upon the deductibility of such contributions under
Code Section 404.
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ARTICLE II
DEFINITIONS
All references to articles, sections, subsections, and
paragraphs shall be to articles, sections, subsections, and
paragraphs of this Plan unless another reference is expressly set
forth in this Plan. Any words used in the masculine shall be
read and be construed in the feminine where they would so apply.
Words in the singular shall be read and construed in the plural,
and all words in the plural shall be read and construed in the
singular in all cases where they would so apply.
For purposes of this Plan, unless otherwise required by the
context, the following terms shall have the meanings set forth
opposite such terms:
1.1 "Account" shall mean the total amount credited to the
account of a Participant, as described in Section 9.1.
1.2 "Actual Deferral Percentage" shall mean the ratio
(expressed as a percentage) of Elective Employer Contributions on
behalf of an Eligible Participant for the Plan Year to the
Eligible Participant's compensation for the Plan Year. For the
purpose of determining an Eligible Participant's Actual Deferral
Percentage for a Plan Year, the Benefit Plan Administration
Committee may elect to consider an Eligible Participant's
compensation for (a) the entire Plan Year or (b) that portion of
the Plan Year in which the Eligible Participant was eligible to
have Elective Employer Contributions made on his behalf, provided
that such election is applied uniformly to all Eligible
Participants for the Plan Year. The Actual Deferral Percentage
of an Eligible Participant who does not have Elective Employer
Contributions made on his behalf shall be zero.
1.3 "Actual Deferral Percentage Test" shall mean the test
described in Section 4.5(a).
1.4 "Affiliated Employer" shall mean the Company and (a)
any corporation which is a member of a controlled group of
corporations (as defined in Section 414(b) of the Code) which
includes the Company, (b) any trade or business (whether or not
incorporated) which is under common control (as defined in
Section 414(c) of the Code) with the Company, (c) any
organization (whether or not incorporated) which is a member of
an affiliated service group (as defined in Section 414(m) of the
Code) which includes the Company, and (d) any other entity
required to be aggregated with the Company pursuant to
regulations under Section 414(o) of the Code. Notwithstanding
the foregoing, for purposes of applying the limitations of
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Article VI, the term Affiliated Employer shall be adjusted as
required by Code Section 415(h).
1.5 "Annual Addition" shall mean the amount allocated to a
Participant's Account and accounts under all defined contribution
plans maintained by the Affiliated Employers during a Limitation
Year that constitutes
(a) Affiliated Employer contributions,
(b) voluntary participant contributions,
(c) forfeitures, if any, allocated to a
Participant's Account or accounts under all defined
contribution plans maintained by the Affiliated
Employers, and
(d) amounts described in Sections 415(l)(1) and
419A(d)(2) of the Code.
1.6 "Average Actual Deferral Percentage" shall mean the
average (expressed as a percentage) of the Actual Deferral
Percentages of the Eligible Participants in a group.
1.7 "Beneficiary" shall mean any person(s) who, or
estate(s), trust(s), or organization(s) which, in accordance with
the provisions of Section 12.4, become entitled to receive
benefits upon the death of a Participant.
1.8 "Benefit Plan Administration Committee" shall mean the
committee appointed pursuant to Section 13.1 to serve as plan
administrator.
1.9 "Board of Directors" shall mean the Board of Directors
of Southern Electric International, Inc.
1.10 "Break-in-Service Date" means the earlier of:
(a) the date on which an Employee terminates employment,
is discharged, retires, or dies; or
(b) the last day of an approved leave of absence including
any extension.
In the case of an individual who is absent from work for
maternity or paternity reasons, such individual shall not incur a
Break-in-Service Date earlier than the expiration of the second
anniversary of the first date of such absence; provided, however,
that the twelve-consecutive-month period beginning on the first
anniversary of the first date of such absence shall not
constitute a Year of Service. For purposes of this paragraph, an
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absence from work for maternity or paternity reasons means an
absence (a) by reason of the pregnancy of the Employee, (b) by
reason of a birth of a child of the Employee, (c) by reason of
the placement of a child with the Employee in connection with the
adoption of such child by such Employee, or (d) for purposes of
caring for such child for a period beginning immediately
following such birth or placement.
1.11 "Code" shall mean the Internal Revenue Code of 1986,
as amended, or any successor statute, and the rulings and
regulations promulgated thereunder. In the event an amendment to
the Code renumbers a section of the Code referred to in this
Plan, any such reference automatically shall become a reference
to such section as renumbered.
1.12 "Common Stock" shall mean the common stock of The
Southern Company.
1.13 "Company" shall mean Southern Electric International,
Inc., and its successors.
1.14 "Compensation" shall mean a Participant's "base pay"
for services rendered during a Plan Year as determined on the
first day of each payroll period during the Plan Year. Base pay
for a Participant who is a non-shift worker shall mean such
Participant's permanent straight time pay multiplied by 49 hours
per week. Base pay for a Participant who is a shift worker shall
mean such Participant's permanent straight time pay multiplied by
55 hours per week.
The Compensation of each Participant taken into account for
purposes of this Plan shall not exceed $150,000 (as adjusted
pursuant to Code Section 401(a)(17)). If a determination period
consists of fewer than 12 months, the annual Compensation limit
under Code Section 401(a)(17) shall be multiplied by a fraction,
the numerator of which is the number of months in the
determination period and the denominator of which is 12. In
determining the Compensation of a Participant for purposes of
this limitation, the rules of Section 414(q)(6) of the Code shall
apply, except in applying such rules, the term "family" shall
include only the spouse of the Participant and any lineal
descendants of the Participant who have not attained age 19
before the close of the Plan Year. If, as a result of the
application of the rules of Code Section 414(q)(6), the adjusted
dollar limitation is exceeded, then the limitation shall be
prorated among the affected individuals in proportion to each
such individual's Compensation, as determined under this Section
2.14 prior to the application of this limitation.
1.15 "Defined Benefit Plan Fraction" shall mean the
following fraction:
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(numerator) Sum of the projected annual benefits of
the Participant under all Affiliated Employer defined
benefit plans (whether or not terminated) determined
as of the close of the Plan Year.
(denominator) The lesser of (a) the product of 1.25
multiplied by the dollar limitation in effect for the
Plan Year under Code Sections 415(b)(1)(A) or 415(d),
or (b) 1.4 multiplied by 100% of the Participant's
average compensation for his highest three (3)
consecutive Plan Years of participation as adjusted
under Treasury Regulation Section 1.415-5.
1.16 "Defined Contribution Plan Fraction" shall mean the
following fraction:
(numerator) The sum of all Annual Additions to the
account of the Participant as of the close of the Plan
Year under all defined contribution plans maintained
by the Affiliated Employers for the current and prior
Limitation Years (whether or not terminated),
including this Plan.
(denominator) The sum of the lesser of the following
amounts determined for such Plan Year and for each
prior Plan Year in which the Participant has a Year of
Service: (a) 1.25 multiplied by the dollar limitation
in effect under Code Section 415(c)(1)(A) for the Plan
Year (determined without regard to Code Section
415(c)(6)), or (b) 1.4 multiplied by the amount that
may be taken into account under Code Section
415(c)(1)(B) with respect to a Participant for the
Plan Year.
1.17 "Determination Year" shall mean the Plan Year being
tested.
1.18 "Distributee" shall include an Employee or former
Employee. In addition, the Employee's or former Employee's
surviving spouse and the Employee's or former Employee's spouse
or former spouse who is an alternate payee under a qualified
domestic relations order, as defined in Section 414(p) of the
Code, are Distributees with regard to the interest of the spouse
or former spouse.
1.19 "Direct Rollover" shall mean a payment by the Plan to
the Eligible Retirement Plan specified by the Distributee.
1.20 "Elective Employer Contribution" shall mean
contributions made pursuant to Section 4.1 during the Plan Year
by the Company, at the election of the Participant, in lieu of
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cash compensation and shall include contributions made pursuant
to a salary reduction agreement.
1.21 "Eligible Employee" shall mean an Employee who is
employed by the Company and who is represented by one of the
following collective bargaining units: (a) United Paperworkers
International Union Local No. 1421, (b) United Paperworkers
International Union Local No. 423, and (c) International
Brotherhood of Electrical Workers Local No. 2129.
Notwithstanding the foregoing, no Employee shall be entitled to
participate in this Plan if such Employee is eligible to
participate in a plan of an Affiliated Employer that is intended
to meet the requirements of Code Section 401(k).
1.22 "Eligible Participant" shall mean an Eligible Employee
who is authorized to have Elective Employer Contributions or
Voluntary Participant Contributions allocated to his Account for
the Plan Year.
1.23 "Eligible Retirement Plan" shall mean an individual
retirement account described in Section 408(a) of the Code, an
individual retirement annuity described in Section 408(b) of the
Code, an annuity plan described in Section 403(a) of the Code, or
a qualified trust described in Section 401(a) of the Code that
accepts the Distributee's Eligible Rollover Distribution.
However, in the case of an Eligible Rollover Distribution to a
spouse, an Eligible Retirement Plan is an individual retirement
account or individual retirement annuity.
1.24 "Eligible Rollover Distribution" shall mean any
distribution of all or any portion of the balance to the credit
of the Distributee, except that an Eligible Rollover Distribution
does not include: (a) any distribution that is one of a series
of substantially equal periodic payments (not less frequently
than annually) made for the life (or life expectancy) of the
Distributee, the joint lives (or joint life expectancies) of the
Distributee and the Distributee's Beneficiary, or for a specified
period of 10 years or more; (b) any distribution to the extent
such distribution is required under Section 401(a)(9) of the
Code; and (c) the portion of any distribution that is not
includable in gross income (determined without regard to the
exclusion for net unrealized appreciation with respect to
employer securities).
1.25 "Employee" shall mean each individual who is employed
by an Affiliated Employer under common law and each individual
who is required to be treated as an employee pursuant to the
"leased employee" rules of Code Section 414(n) other than a
leased employee described in Code Section 414(n)(5).
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1.26 "Employer Matching Contribution" shall mean a
contribution made by the Company pursuant to Section 5.1.
1.27 "Enrollment Date" shall mean the first day of each
calendar month.
1.28 "ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as amended, or any successor statute, and
the rulings and regulations promulgated thereunder. In the event
an amendment to ERISA renumbers a section of ERISA referred to in
this Plan, any such reference automatically shall become a
reference to such section as renumbered.
1.29 "Excess Deferral Amount" shall mean the amount of
Elective Employer Contributions for a calendar year that exceed
the Code Section 402(g) limits as allocated to this Plan pursuant
to Section 4.3(b).
1.30 "Excess Deferral Contributions" shall mean the amount
of Elective Employer Contributions on behalf of a Highly
Compensated Employee in excess of the maximum permitted under
Section 4.5(a) as determined pursuant to Section 4.5(b).
1.31 "Family Member" shall mean the spouse, lineal
ascendants and descendants of an Employee or former Employee, and
the spouses of such lineal ascendants and descendants as
described in Code Section 414(q)(6)(B).
1.32 "Highly Compensated Employee" shall mean any Employee
or former Employee (excluding any Employees who may be excluded
pursuant to Code Section 414(q)(8)) who during the Determination
Year or the Look-Back Year:
(a) was at any time a five-percent (5%) owner (as
defined in Code Section 416(i)(1)(B)(i));
(b) received compensation (within the meaning of Code
Section 414(q)(7)) from an Affiliated Employer in excess of
$75,000 (or such amount as may be adjusted by the Secretary
of the Treasury);
(c) received compensation (within the meaning of Code
Section 414(q)(7)) from an Affiliated Employer in excess of
$50,000 (or such amount as may be adjusted by the Secretary
of the Treasury) and was in the top-paid group (as defined
in Code Section 414(q)(4)) of Employees for such year; or
(d) was at any time an officer and received
compensation (within the meaning of Code Section 414(q)(7))
greater than fifty percent (50%) of the amount in effect
under Code Section 415(b)(1)(A) for such year.
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Notwithstanding the foregoing, the determination of which
Employees are Highly Compensated Employees shall at all times be
subject to the rules of Code Section 414(q); the maximum number
of officers taken into account under (d) above shall not exceed
fifty (50); and Employees who were not described in (b), (c) or
(d) above during the Look-Back Year shall not be considered as
described in such subsections for the Determination Year unless
such Employees are members of the group consisting of the one
hundred (100) Employees paid the greatest compensation (within
the meaning of Code Section 414(q)(7)) for the Determination
Year.
A Highly Compensated Employee shall include any Employee who
separated from service (or was deemed to have separated) prior to
the Plan Year, performs no service for an Affiliated Employer
during the Plan Year, and was a Highly Compensated Employee for
either the separation year or any Determination Year ending on or
after the Employee's fifty-fifth (55th) birthday.
If an Employee is, during a Determination Year or a Look-
Back Year, a Family Member of either (x) a five-percent (5%)
owner who is an Employee or (y) a former Employee or a Highly
Compensated Employee who is one of the top-ten most Highly
Compensated Employees ranked on the basis of compensation paid by
an Affiliated Employer during such year, then the Family Member
and the five-percent (5%) owner or top-ten Highly Compensated
Employee shall be treated as a single employee receiving
compensation and Plan contributions equal to the sum of the
compensation and contributions for such individuals.
1.33 "Hour of Service" shall mean each hour for which an
Employee is paid, or entitled to payment, for the performance of
duties for an Affiliated Employer.
1.34 "Investment Fund" shall mean any one of the funds
described in Article VIII which constitutes part of the Trust
Fund.
1.35 "Limitation Year" shall mean the Plan Year.
1.36 "Look-Back Year" shall mean the Plan Year preceding
the Determination Year.
1.37 "Non-Highly Compensated Employee" shall mean an
Employee who is neither a Highly Compensated Employee nor the
Family Member of a Highly Compensated Employee.
1.38 "Normal Retirement Date" shall mean the first day of
the month following a Participant's sixty-fifth (65th) birthday.
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1.39 "One-Year Break in Service" shall mean each twelve-
consecutive-month period commencing with an Employee's Break-in-
Service Date and ending on the date the Employee is again
credited with an Hour of Service.
1.40 "Participant" shall mean (a) an Eligible Employee who
has elected to participate in the Plan as provided in Article III
and whose participation in the Plan at the time of reference has
not been terminated as provided in the Plan and (b) an Employee
or former Employee who has ceased to be a Participant under (a)
above, but for whom an Account is maintained under the Plan.
1.41 "Plan" shall mean the Southern Electric International,
Inc. Savings Plan for Covered Employees, as described herein or
as from time to time amended.
1.42 "Plan Year" shall mean the twelve-month period
commencing January 1st and ending on the last day of December
next following, provided that the first Plan Year shall commence
on April 1, 1995 and end on December 31, 1995.
1.43 "Surviving Spouse" shall mean the person to whom the
Participant is married on the date of his death, if such spouse
is then living, provided that the Participant and such spouse
shall have been married throughout the one (1) year period ending
on the date of the Participant's death.
1.44 "Trust" or "Trust Fund" shall mean the trust
established pursuant to the Trust Agreement.
1.45 "Trust Agreement" shall mean the trust agreement
between the Company and the Trustee, as described in Article XIV.
1.46 "Trustee" shall mean the person or corporation
designated as trustee under the Trust Agreement, including any
successor or successors.
1.47 "Valuation Date" shall mean each business day of the
Trustee.
1.48 "Voluntary Participant Contribution" shall mean a
contribution made pursuant to Section 4.6 during the Plan Year.
1.49 "Year of Service" shall mean a twelve-month period of
employment as an Employee, including any fractions thereof.
Years of Service shall commence with the Employee's first day of
employment, which is the date on which an Employee first performs
an Hour of Service, and shall terminate on his Break-in-Service
Date. Thereafter, if he has more than one period of employment
as an Employee, his Years of Service for any subsequent period
shall commence with the Employee's reemployment date, which is
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the first date following a Break-in-Service Date on which the
Employee performs an Hour of Service, and shall terminate on his
next Break-in-Service Date. An Employee who has a Break-in-
Service Date and resumes employment with the Affiliated Employers
within twelve months of the date he last performed services for
the Affiliated Employers shall receive a fractional Year of
Service for the period of such cessation of employment.
Notwithstanding anything in this Section 2.49 to the
contrary, an Employee shall not receive credit for more than one
Year of Service with respect to any twelve-consecutive-month
period.
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ARTICLE III
PARTICIPATION
2.1 Eligibility Requirements. An Eligible Employee may
elect to participate in the Plan as of the later of April 1,
1995, or any Enrollment Date after he has completed a Year of
Service. An Eligible Employee shall make an election to
participate by authorizing deductions from or reduction of his
Compensation as contributions to the Plan in accordance with
Article IV, and directing the investment of such contributions in
accordance with Article VIII. Such Compensation deduction and/or
reduction authorization and investment direction shall be made in
accordance with the procedures established from time to time by
the Benefit Plan Administration Committee. Notwithstanding the
above, an Employee may elect voluntarily not to participate in
the Plan by communicating such election to the Company prior to
his Enrollment Date or a Plan Year, as appropriate.
2.2 Participation upon Reemployment. If an Employee
terminates his employment with an Affiliated Employer and is
subsequently reemployed as an Eligible Employee, the following
rules shall apply in determining his eligibility to participate:
(a) If the reemployed Eligible Employee had not
completed the Year of Service requirement of Section 3.1
prior to his termination of employment and is reemployed
following a One-Year Break in Service, he shall not receive
credit for fractional periods of service completed prior to
the One-Year Break in Service until he has completed a Year
of Service after his return.
(b) If the reemployed Eligible Employee fulfilled the
eligibility requirements of Section 3.1 prior to his
termination of employment and is reemployed as an Eligible
Employee, whether before or after he incurs a One-Year Break
in Service, he may elect to become a Participant in the Plan
as of the date of his reemployment.
2.3 No Restoration of Previously Distributed Benefits. A
Participant who has terminated his employment with the Company
and who has received a distribution of the amount credited to his
Account pursuant to Section 12.5 shall not be entitled to restore
the amount of such distribution to his Account if he is
reemployed and again becomes a Participant in the Plan.
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2.4 Loss of Eligible Employee Status. If a Participant
loses his status as an Eligible Employee, but remains an
Employee, such Participant shall be ineligible to participate and
shall be deemed to have elected to suspend making Voluntary
Participant Contributions or to have Elective Employer
Contributions made on his behalf.
2.5 Special Rules for Scott Paper Company Energy Complex
Employees. An Eligible Employee who was an employee of Scott
Paper Company Energy Complex on December 16, 1994, and who became
an employee of the Company effective December 17, 1994, shall be
credited with a Year of Service as of March 31, 1995, and may
elect to become a Participant as of any Enrollment Date
commencing on or after April 1, 1995. In addition, during the
period commencing April 1, 1995 and ending June 15, 1996, such
Eligible Employees shall be entitled to make a rollover
contribution to the Plan in cash to be held as part of his
Account with respect to all or a portion of the distribution such
Eligible Employee receives under the Scott Paper Company Hourly
Investment Plan.
Such rollover contribution may only be made within sixty
(60) days following the date the Participant receives the
distribution (or within such additional period as may be provided
under Section 408 of the Code if the Participant shall have made
a timely deposit of the distribution in an individual retirement
account). No such rollover contribution shall be made by such
Eligible Employee if not otherwise permissible under the Code or
if such rollover contribution or transfer would subject this Plan
to the requirements of Section 401(a)(11)(A) of the Code.
Any amounts so contributed to the Plan shall be entitled to
share in earnings or losses of the Trust in the same manner as
other Company and Employee contributions to the Trust. The
portion of a Participant's Account attributable to any rollover
contribution from the Scott Paper Company Hourly Investment Plan
shall be distributed with the balance of the Participant's
Account pursuant to Article XII of the Plan.
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ARTICLE IV
ELECTIVE EMPLOYER CONTRIBUTIONS AND
VOLUNTARY PARTICIPANT CONTRIBUTIONS
3.1 Elective Employer Contributions. An Eligible Employee
who meets the participation requirements of Article III may elect
in accordance with the procedures established by the Benefit Plan
Administration Committee to have his Compensation reduced by a
whole percentage of his Compensation, which percentage shall not
be less than one percent (1%) nor more than sixteen percent (16%)
of his Compensation, such Elective Employer Contribution to be
contributed by the Company to his Account under the Plan.
3.2 Maximum Amount of Elective Employer Contributions.
The maximum amount of Elective Employer Contributions that may be
made on behalf of a Participant during any Plan Year to this Plan
or any other qualified plan maintained by the Company shall not
exceed the dollar limitation set forth in Section 402(g) of the
Code in effect at the beginning of such Plan Year.
3.3 Distribution of Excess Deferral Amounts.
(a) In General. Notwithstanding any other provision
of the Plan, Excess Deferral Amounts and income allocable
thereto shall be distributed (and any corresponding Employer
Matching Contributions shall be forfeited) no later than
April 15, 1996, and each April 15 thereafter, to
Participants who allocate (or are deemed to allocate) such
amounts to this Plan pursuant to (b) below for the preceding
calendar year. Excess Deferral Amounts that are distributed
shall not be treated as an Annual Addition. Any amount
forfeited pursuant to this Subsection (a) shall be held in a
suspense account and shall be applied, subject to Section
6.1, toward funding the Company contributions for the next
succeeding Plan Year.
(b) Assignment. The Participant's allocation of
amounts in excess of the Code Section 402(g) limits to this
Plan shall be in writing; shall be submitted to the Benefit
Plan Administration Committee no later than March 1; shall
specify the Participant's Excess Deferral Amount for the
preceding calendar year; and shall be accompanied by the
Participant's written statement that if such amounts are not
distributed, such Excess Deferral Amount, when added to
amounts deferred under other plans or arrangements described
in Section 401(k), 408(k), 402(h)(1)(B), 457, 501(c)(18), or
403(b) of the Code, exceeds the limit imposed on the
Participant by Section 402(g) of the Code for the year in
which the deferral occurred. A Participant is deemed to
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notify the Benefit Plan Administration Committee of any
Excess Deferral Amounts that arise by taking into account
only those deferrals under this Plan and any other plans of
the Company.
(c) Determination of Income or Loss. The Excess
Deferral Amount distributed to a Participant with respect to
a calendar year shall be adjusted for income or loss through
the last day of the Plan Year or the date of distribution,
as determined by the Benefit Plan Administration Committee.
The income or loss allocable to Excess Deferral Amounts is
the sum of:
(1) income or loss allocated to the
Participant's Account for the taxable year multiplied
by a fraction, the numerator of which is such
Participant's Excess Deferral Amount for the year and
the denominator is the Participant's Account balance
attributable to Elective Employer Contributions, minus
any income or plus any loss occurring during the Plan
Year; and
(2) if the Benefit Plan Administration Committee
shall determine in its sole discretion, ten percent
(10%) of the amount determined under (1) above
multiplied by the number of whole calendar months
between the end of the Plan Year and the date of the
distribution, counting the month of distribution if
distribution occurs after the 15th of the month.
Notwithstanding the above, the Benefit Plan Administration
Committee may designate any reasonable method for computing the
income or loss allocable to Excess Deferral Amounts, provided
that the method does not violate Section 401(a)(4) of the Code,
is used consistently for all Participants and for all corrective
distributions under the Plan for the Plan Year, and is used by
the Plan for allocating income or loss to Participants' Accounts.
(3) Maximum Distribution Amount. The Excess
Deferral Amount, which would otherwise be distributed
to the Participant, shall, if there is a loss
allocable to such Excess Deferral Amount, in no event
be less than the lesser of the Participant's Account
under the Plan attributable to Elective Employer
Contributions or the Participant's Elective Employer
Contributions for the Plan Year.
3.4 Additional Rules Regarding Elective Employer
Contributions.
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Salary reduction agreements shall be governed by the
following:
(a) A salary reduction agreement shall apply to
payroll periods during which an effective salary reduction
agreement is in effect. The Benefit Plan Administration
Committee, in its discretion, may establish administrative
procedures whereby the actual reduction in Compensation may
be made to coincide with each payroll period of the Company,
or at such other times as the Benefit Plan Administration
Committee may determine.
(b) The Benefit Plan Administration Committee may
amend or revoke a Participant's salary reduction agreement
with the Company at any time, if the Benefit Plan
Administration Committee determines that such revocation or
amendment is necessary to ensure that a Participant's
additions for any Plan Year will not exceed the limitations
of Sections 4.2 and 6.1 of the Plan or to ensure that the
Actual Deferral Percentage Test is satisfied.
(c) Except as required under (b) above, and under
Section 4.5(d) below, no amounts attributable to Elective
Employer Contributions may be distributed to a Participant
or his Beneficiary from his Account prior to the earlier of:
(1) the separation from service, death or
disability of the Participant;
(2) the attainment of age 59 1/2 by the
Participant;
(3) the termination of the Plan without
establishment of a successor plan;
(4) a financial hardship of the Participant
pursuant to Section 11.6 of the Plan;
(5) the date of a sale by the Company to an
entity that is not an Affiliated Employer of
substantially all of the assets (within the
meaning of Code Section 409(d)(2)) with
respect to a Participant who continues
employment with the corporation acquiring
such assets; or
(6) the date of the sale by the Company or an
Affiliated Employer of its interest in a
subsidiary (within the meaning of Code
Section 409(d)(3)) to an entity which is not
an Affiliated Employer with respect to the
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Participant who continues employment with
such subsidiary.
3.5 Section 401(k) Nondiscrimination Tests.
(a) Actual Deferral Percentage Test. The Plan
shall satisfy the nondiscrimination test of Section
401(k)(3) of the Code, under which no Elective
Employer Contributions shall be made that would cause
the Actual Deferral Percentage for Eligible
Participants who are Highly Compensated Employees to
exceed (1) or (2) as follows:
(1) The Average Actual Deferral Percentage
for the Eligible Participants who are Highly
Compensated Employees for the Plan Year shall not
exceed the Average Actual Deferral Percentage for
Eligible Participants who are Non-Highly
Compensated Employees for the Plan Year
multiplied by 1.25; or
(2) The Average Actual Deferral Percentage
for Eligible Participants who are Highly
Compensated Employees for the Plan Year shall not
exceed the Average Actual Deferral Percentage for
Eligible Participants who are Non-Highly
Compensated Employees for the Plan Year
multiplied by two (2), provided that the Average
Actual Deferral Percentage for Eligible
Participants who are Highly Compensated Employees
does not exceed the Average Actual Deferral
Percentage for Eligible Participants who are
Non-Highly Compensated Employees by more than two
(2) percentage points.
(b) Amount of Excess Deferral Contributions.
The amount of Excess Deferral Contributions for a
Highly Compensated Employee for a Plan Year is to be
determined by the leveling method described in
Treasury Regulation Section 1.401(k)-l(f)(2), under
which the Actual Deferral Percentage of the Highly
Compensated Employee with the highest Actual Deferral
Percentage shall be reduced to the extent required to:
(1) enable the Plan to satisfy the Actual
Deferral Percentage Test, or
(2) cause such Highly Compensated
Employee's Actual Deferral Percentage to equal
the ratio of the Highly Compensated Employee with
the next highest Actual Deferral Percentage.
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This process must be repeated until the Plan satisfies the
Actual Deferral Percentage Test. The amount of Excess Deferral
Contributions for a Highly Compensated Employee is equal to the
total of Elective Employer Contributions and other contributions
taken into account for the Actual Deferral Percentage Test minus
the amount determined by multiplying the Employee's contribution
percentage, as determined above, by his compensation.
(c) Correction for Family Members. In the case of a
Highly Compensated Employee whose Actual Deferral Percentage
is determined under the family aggregation rules described
in Treasury Regulation Section 1.401(k)-1(g)(1)(ii)(C), the
determination and correction of the amount of Excess
Deferral Contributions is accomplished by reducing the
Actual Deferral Percentage as required under (b) above and
allocating the excess for the family group among the Family
Members in proportion to the Elective Employer Contributions
of each Family Member that is combined to determine the
Actual Deferral Percentage.
(1) If a Highly Compensated Employee is subject
to the family aggregation rules of Code Section
414(q)(6) because that Eligible Participant is either
a five-percent owner or one of the 10 Highly
Compensated Employees receiving the most compensation
from the Affiliated Employers, the combined Actual
Deferral Percentage for the family group (which is
treated as one Highly Compensated Employee) must be
determined by combining the Elective Employer
Contributions, compensation, and amounts treated as
Elective Employer Contributions of the eligible Family
Members.
(2) The Elective Employer Contributions,
compensation, and amounts treated as Elective Employer
Contributions of all Family Members are disregarded
for purposes of determining the Actual Deferral
Percentage for the group of Non-Highly Compensated
Employees.
(3) If an Eligible Employee is required to be
aggregated as a member of more than one family group
in a plan, all Eligible Employees who are members of
those family groups that include that Employee are
aggregated as one family group.
(d) Correction of Excess Deferral Contributions.
(1) In General. Notwithstanding any other
provisions of this Plan, Excess Deferral Contributions
plus any income and minus any loss allocable thereto
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shall be distributed (and any corresponding Employer
Matching Contribution shall be forfeited) to
Participants on whose behalf such Excess Deferral
Contributions were made not later than the last day of
the Plan Year following the close of the Plan Year for
which such contributions were made. If such Excess
Deferral Contributions are not distributed within two
and one-half (2-1/2) months after the last day of the
Plan Year in which such excess amounts arose, a ten
percent (10%) excise tax will be imposed on the
Company. Distribution of Excess Deferral
Contributions shall be made to Highly Compensated
Employees on the basis of the respective portions of
the Excess Deferral Contributions attributable to each
of such Employees. Any amount forfeited pursuant to
this Subsection (d)(1) shall be held in a suspense
account and shall be applied, subject to Section 6.1,
toward funding the Company contributions for the next
succeeding Plan Year.
(2) Determination of Income or Loss. Excess
Deferral Contributions shall be adjusted for any
income or loss through the last day of the Plan Year
or the date of distribution, as determined by the
Benefit Plan Administration Committee. The income or
loss allocable to Excess Deferral Contributions is the
sum of:
(A) income or loss allocated to the
Participant's Account for the taxable year
multiplied by a fraction, the numerator of which
is the Participant's Excess Deferral
Contributions for the year and the denominator is
the Participant's Account balance attributable to
Elective Employer Contributions, minus any income
or plus any loss occurring during the Plan Year;
and
(B) if the Benefit Plan Administration
Committee shall determine in its sole discretion,
ten percent (10%) of the amount determined under
(A) above multiplied by the number of whole
calendar months between the end of the Plan Year
and the date of the distribution, counting the
month of distribution if distribution occurs
after the 15th of the month.
Notwithstanding the above, the Benefit Plan Administration
Committee may designate any reasonable method for computing the
income or loss allocable to Excess Deferral Contributions,
provided that the method does not violate Section 401(a)(4) of
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the Code, is used consistently for all Participants and for all
corrective distributions under the Plan for the Plan Year, and is
used by the Plan for allocating income or loss to Participants'
Accounts.
(3) Maximum Distribution Amount. The Excess
Deferral Contributions which would otherwise be
distributed to the Participant shall be adjusted for
income; shall be reduced, in accordance with
regulations, by the Excess Deferral Amount distributed
to the Participant; and shall, if there is a loss
allocable to the Excess Deferral Contributions, in no
event be less than the lesser of the Participant's
Account under the Plan attributable to Elective
Employer Contributions or the Participant's Elective
Employer Contributions for the Plan Year.
(e) Special Rules.
(1) For purposes of this Section 4.5, the Actual
Deferral Percentage for any Eligible Participant who
is a Highly Compensated Employee for the Plan Year and
who is eligible to have deferral contributions
allocated to his account under two (2) or more plans
or arrangements described in Section 401(k) of the
Code that are maintained by an Affiliated Employer
shall be determined as if all such deferral
contributions were made under a single arrangement. If
a Highly Compensated Employee participates in two (2)
or more cash or deferred arrangements that have
different plan years, all cash or deferred
arrangements ending with or within the same calendar
year shall be treated as a single arrangement.
Notwithstanding the foregoing, certain plans shall be
treated as separate if mandatorily disaggregated under
Code Section 401(k).
(2) In the event that this Plan satisfies the
requirements of Code Section 401(k), 401(a)(4), or
410(b) only if aggregated with one or more other
plans, or if one or more other plans satisfy the
requirements of Code Section 401(k), 401(a)(4), or
410(b) only if aggregated with this Plan, then the
actual deferral percentages shall be determined as if
all such plans were a single plan.
(3) For purposes of determining the Actual
Deferral Percentage of an Eligible Participant who is
a five-percent owner or one of the 10 Highly
Compensated Employees receiving the most compensation
from Affiliated Employers, the Elective Employer
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Contributions and compensation of such Participant
shall include the Elective Employer Contributions and
compensation of Family Members, and such Family
Members shall be disregarded in determining the Actual
Deferral Percentage for Eligible Participants who are
Non-Highly Compensated Employees.
(4) The determination and treatment of the
Elective Employer Contributions and Actual Deferral
Percentage of any Eligible Participant shall satisfy
such other requirements as may be prescribed by the
Secretary of the Treasury.
3.6 Voluntary Participant Contributions. An Eligible
Employee who meets the participation requirements of Article III
may elect in accordance with the procedures established by the
Benefit Plan Administration Committee to contribute to his
Account a Voluntary Participant Contribution consisting of any
whole percentage of his Compensation, which percentage is not
less than one percent (1%) nor more than sixteen percent (16%) of
his Compensation. The maximum Voluntary Participant Contribution
shall be reduced by the percent, if any, which is contributed as
an Elective Employer Contribution on behalf of such Participant
under Section 4.1.
3.7 Manner and Time of Payment of Elective Employer
Contributions and Voluntary Participant Contributions.
Contributions made in accordance with Sections 4.1 and 4.6 will
be rounded to the next higher multiple of one dollar. They will
be made only through payroll deductions and will begin with the
first payroll period (or as soon as practicable thereafter)
commencing after the Enrollment Date on which the Participant
commences participation in the Plan. Contributions shall be
remitted to the Trustee as of the earliest date on which such
contributions can reasonably be segregated from the Company's
general assets, but in any event within ninety (90) days from the
date on which such amounts would otherwise have been payable to
the Participant in cash.
3.8 Change in Contribution Rate. A Participant may change
the percentage of his Compensation that he has authorized as the
Elective Employer Contribution to be made on his behalf or his
Voluntary Participant Contribution to another permissible
percentage in accordance with the procedures established by the
Benefit Plan Administration Committee. Such election shall be
effective as soon as practicable after it is made.
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ARTICLE V
EMPLOYER MATCHING CONTRIBUTIONS
4.1 Amount of Employer Matching Contributions. Subject to
the provisions of Sections 6.1 and 6.2, the Company shall
contribute an Employer Matching Contribution on behalf of each of
the Participants an amount equal to sixty percent (60%) of the
Elective Employer Contributions made on a Participant's behalf
plus his Voluntary Participant Contributions, to the extent such
contributions, when combined, do not exceed six percent (6%) of
his Compensation. The Employer Matching Contribution shall be
allocated first to the Elective Employer Contributions made on a
Participant's behalf.
4.2 Investment of Employer Matching Contributions.
Employer Matching Contributions shall be invested entirely in the
Company Stock Fund, as described in Article VIII.
4.3 Payment of Employer Matching Contributions. Employer
Matching Contributions shall be remitted to the Trustee as soon
as practicable.
4.4 Reversion of Company Contributions. Company
contributions computed in accordance with the provisions of this
Plan shall revert to the Company under the following
circumstances:
(a) In the case of a Company contribution which is
made by reason of a mistake of fact, such contribution upon
written direction of the Company shall be returned to the
Company within one year after the payment of the
contribution.
(b) If any Company contribution is determined to be
nondeductible under Section 404 of the Code, then such
Company contribution, to the extent that it is determined to
be nondeductible, upon written direction of the Company
shall be returned to the Company within one year after the
disallowance of the deduction.
The amount which may be returned to the Company under this
Section 5.4 is the excess of (1) the amount contributed over (2)
the amount that would have been contributed had there not
occurred a mistake of fact or disallowance of the deduction.
Earnings attributable to the excess contribution shall not be
returned to the Company, but losses attributable thereto shall
reduce the amount to be so returned. If the withdrawal of the
amount attributable to the mistaken contribution would cause the
balance of the Account of any Participant to be reduced to less
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than the balance which would have been in the Account had the
mistaken amount not been contributed, then the amount to be
returned to the Company shall be limited so as to avoid such
reduction.
4.5 Correction of Prior Incorrect Allocations and
Distributions. Notwithstanding any provisions contained herein
to the contrary, in the event that, as of any Valuation Date,
adjustments are required in any Participants' Accounts to correct
any incorrect allocation of contributions or investment earnings
or losses, or such other discrepancies in Account balances that
may have occurred previously, the Company may make additional
contributions to the Plan to be applied to correct such incorrect
allocations or discrepancies. The additional contributions shall
be allocated by the Benefit Plan Administration Committee to
adjust such Participants' Accounts to the value which would have
existed on said Valuation Date had there been no prior incorrect
allocation or discrepancies. The Benefit Plan Administration
Committee shall also be authorized to take such other actions as
it deems necessary to correct prior incorrect allocations or
discrepancies in the Accounts of Participants under the Plan.
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ARTICLE VI
LIMITATIONS ON CONTRIBUTIONS
5.1 Section 415 Limitations.
(a) Notwithstanding any provision of the Plan to the
contrary, the total Annual Additions allocated to the
Account (and the accounts under all defined contribution
plans maintained by an Affiliated Employer) of any
Participant for any Limitation Year in accordance with Code
Section 415 and the regulations thereunder, which are
incorporated herein by this reference, shall not exceed the
lesser of the following amounts:
(1) twenty-five percent (25%) of the
Participant's compensation in the Limitation Year; or
(2) $30,000 (as adjusted pursuant to Code
Section 415(d)(1)(C)).
(b) If a Participant is also a participant in any
Affiliated Employer's defined benefit plan, then in addition
to the limitations in (a) above, the sum of the Defined
Benefit Plan Fraction and Defined Contribution Plan Fraction
shall not exceed 1.0 for any Limitation Year.
(c) For purposes of this Section 6.1, wherever the
term "compensation" is used, such term shall mean all
amounts paid or made available to an Employee which are
treated as compensation from an Affiliated Employer under
Treasury Regulation Section 1.415-2(d)(2) and which are not
excluded from compensation under Treasury Regulation Section
1.415-2(d)(3).
5.2 Correction of Contributions in Excess of Section 415
Limits. If the Annual Additions for a Participant exceed the
limits of Section 6.1 as a result of the allocation of
forfeitures, if any, a reasonable error in estimating a
Participant's annual compensation for purposes of the Plan, a
reasonable error in determining the amount of elective deferrals
(within the meaning of Section 402(g)(3) of the Code) that may be
made with respect to any individual, or under other limited facts
and circumstances that the Commissioner of the Treasury finds
justify the availability of the rules set forth in this Section
6.2, the excess amounts shall not be deemed Annual Additions if
they are treated in accordance with any one or more or any
combination of the following:
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(a) distribute to the Participant that portion, or
all, of his Elective Employer Contributions (as
adjusted for income and loss) as is necessary to
ensure compliance with Section 6.1;
(b) return to the Participant that portion, or all,
of his Voluntary Participant Contributions (as
adjusted for income and loss) as is necessary to
ensure compliance with Section 6.1; and
(c) forfeiture of that portion, or all, of the
Employer Matching Contributions (as adjusted for
income and loss) and any forfeitures of Employer
contributions that were allocated to the
Participant's Account (as adjusted for income and
loss), as is necessary to ensure compliance with
Section 6.1.
Any amounts distributed or returned to the Participant under
(a) above shall be disregarded for purposes of the Actual
Deferral Percentage Test.
Any amounts forfeited under this Section 6.2 shall be held
in a suspense account and shall be applied, subject to Section
6.1, toward funding the Employer Matching Contributions for the
next succeeding Plan Year. Such application shall be made prior
to any Company contributions and prior to any Employer Matching
Contributions that would constitute Annual Additions. No income
or investment gains and losses shall be allocated to the suspense
account provided for under this Section 6.2. If any amount
remains in a suspense account provided for under this Section 6.2
upon termination of this Plan, such amount will revert to the
Company notwithstanding any other provision of this Plan.
5.3 Combination of Plans. Notwithstanding any provisions
contained herein to the contrary, in the event that a Participant
participates in a defined contribution plan or defined benefit
plan required to be aggregated with this Plan under Code Section
415(g) and the sum of the Defined Contribution Plan Fraction and
Defined Benefit Plan Fraction with respect to a Participant
exceeds the limitations contained in Section 6.1(b), corrective
adjustments for an Employee shall not be made under this Plan
until made under such other defined benefit plan and defined
contribution plan.
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ARTICLE VII
SUSPENSION OF CONTRIBUTIONS
6.1 Suspension of Contributions. A Participant may
voluntarily suspend the Elective Employer Contribution made on
his behalf and his Voluntary Participant Contributions in
accordance with the procedures established by the Benefit Plan
Administration Committee. Such suspension shall be effective as
soon as practicable after the Participant's election. Whenever
Elective Employer Contributions made on a Participant's behalf
and Voluntary Participant Contributions are suspended, Employer
Matching Contributions shall also be suspended.
6.2 Resumption of Contributions. A Participant may
terminate any such suspension in accordance with the procedures
established by the Benefit Plan Administration Committee. Such
resumption of contributions shall be effective as soon as
practicable after it is made. There shall be no make up of any
contributions by a Participant or by the Company with respect to
a period of suspension.
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ARTICLE VIII
INVESTMENT OF PARTICIPANTS' CONTRIBUTIONS
7.1 Investment Funds. Elective Employer Contributions and
Voluntary Participant Contributions which are paid to the Trustee
shall be added to such one or more of the following Investment
Funds constituting part of the Trust Fund and in such proportions
and amounts as may be determined in accordance with this Article
VIII. The Investment Funds are:
(a) "Merrill Lynch Retirement Preservation Trust"
("Retirement Preservation Trust") which shall be primarily
invested and reinvested in guaranteed investment contracts,
U.S. Government and U.S. Government Agency securities, and
money market instruments.
(b) "Merrill Lynch Capital Fund" ("Capital Fund"),
which shall be primarily invested and reinvested in equity
securities, corporate bonds, and money market securities.
(c) "Company Stock Fund", which shall be invested and
reinvested in Common Stock, provided that funds applicable
to the purchase of Common Stock pending investment of such
funds may be temporarily invested in short-term United
States Government obligations, other obligations guaranteed
by the United States Government, or commercial paper and, if
the Trustee so determines, may be transferred to money
market funds utilized by the Trustee for qualified employee
benefit trusts.
(d) "Merrill Lynch Equity Index Trust" ("Equity Index
Trust"), which is a collective trust fund that shall be
primarily invested and reinvested in common stocks that, so
far as possible, duplicate the composition of Standard &
Poor's 500 Composite Stock Price Index.
7.2 Investment of Participant Contributions. Each
Participant shall direct, at the time he elects to participate in
the Plan, that his Account be invested in one or more of the
Investment Funds, provided such investments are made in one
percent (1%) increments.
7.3 Investment of Earnings. Interest, dividends, if any,
and other distributions received by the Trustee with respect to
an Investment Fund shall be invested in such Investment Fund.
7.4 Transfer of Assets between Funds. A Participant may
direct in accordance with the provisions of this Section 8.4 and
such procedures established by the Benefit Plan Administration
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Committee, that all of his interest in an Investment Fund or
Funds attributable to amounts in his Account (other than Employer
Matching Contributions) or any portion of such amount (expressed
in one percent (1%) increments) to the credit of his Account be
transferred and invested by the Trustee as of such date in any
other Investment Fund as designated by the Participant. Such
direction shall be effective as soon as practicable after it is
made.
7.5 Change in Investment Direction. Any investment
direction given by a Participant shall continue in effect until
changed by the Participant. A Participant may change his
investment direction as to the future contributions and
allocations to his Account in accordance with the procedures
established by the Benefit Plan Administration Committee and such
direction shall be effective as soon as practicable after it is
made.
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ARTICLE IX
MAINTENANCE AND VALUATION OF PARTICIPANTS' ACCOUNTS
8.1 Establishment of Accounts. An Account shall be
established for each Participant. In addition, subaccounts shall
be established for each Participant to reflect all Elective
Employer Contributions, Voluntary Participant Contributions,
Employer Matching Contributions, and any rollover contributions
pursuant to Section 3.5 (and the earnings and/or losses on each
subaccount). Each Participant will be furnished a statement of
his Account at least annually and upon any distribution.
8.2 Valuation of Investment Funds. A Participant's
Account in respect of his interest in the Retirement Preservation
Trust, Capital Fund, Equity Index Trust, and Company Stock Fund
shall be credited or charged, as the case may be, as of each
Valuation Date with the dividends, income, gains, appreciation,
losses, depreciation, forfeitures, expenses, and other
transactions for the Valuation Date as of which such credit or
charge accrued. Such credits or charges to a Participant's
Account shall be made in such proportions and by such method or
formula as shall be deemed by the Benefit Plan Administration
Committee to be necessary or appropriate to account for each
Participant's proportionate beneficial interest in each
Investment Fund. Investments of each Investment Fund shall be
valued at their fair market values as of each Valuation Date as
determined by the Trustee, and such valuation shall conclusively
establish such value.
8.3 Rights in Investment Funds. Nothing contained in this
Article IX shall be deemed to give any Participant any interest
in any specific property in any Investment Fund or any interest,
other than the right to receive payments or distributions in
accordance with the Plan or the right to instruct the Trustee how
to vote Common Stock as provided in Section 14.3.
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ARTICLE X
VESTING
9.1 Vesting. The amount to the credit of a Participant's
Account shall at all times be fully vested and nonforfeitable.
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ARTICLE XI
WITHDRAWALS AND LOANS PRIOR TO TERMINATION OF EMPLOYMENT
10.1 Withdrawals by Participants.
(a) Subject to the provisions of this Section 11.1
and Sections 11.2 through 11.6, a Participant may make
withdrawals from his Account during his employment with an
Affiliated Employer in the order of priority listed below:
(1) A portion or all of the value of his Account
attributable to Voluntary Participant Contributions,
plus a ratable portion or all of the earnings and/or
appreciation thereon;
(2) The entire value of his Account attributable
to Voluntary Participant Contributions, plus all of
the earnings and appreciation thereon;
(3) A portion or all of the value of his Account
attributable to rollover contributions pursuant to
Section 3.5, plus a ratable portion or all of the
earnings and/or appreciation thereon;
(4) The entire value of his Account attributable
to rollover contributions pursuant to Section 3.5,
plus all of the earnings and appreciation thereon;
(5) A portion or all of fifty percent (50%) of
the value of his Account attributable to Employer
Matching Contributions (including earnings and
appreciation thereon) allocated to his Account;
provided, however, that said Participant shall have
participated in the Plan for not less than sixty (60)
months at the time of the withdrawal;
(6) A portion or all of the value of his Account
attributable to Elective Employer Contributions (not
including any earnings or appreciation thereon; and
(7) For Participants who have attained age 59
1/2, a portion or all of the value of his Account
attributable to any earnings or appreciation on
Elective Employer Contributions.
(b) There shall be no limit on the number of
withdrawals which may be made during a Plan Year.
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10.2 Notice of Withdrawal. Notice of withdrawal must be
given by a Participant in accordance with the procedures
established by the Benefit Plan Administration Committee, and if
such withdrawal would constitute an eligible rollover
distribution (within the meaning of Code Section 402(c)(4)), the
consent and notice requirements of Section 12.10 must be
satisfied. Payment of a withdrawal shall be made as soon as
practicable and in accordance with Section 12.10, if applicable.
10.3 Form of Withdrawal. All distributions under this
Article XI shall be made in the form of cash, provided that with
respect to any distribution which is attributable to Common Stock
the Participant shall have the right to demand that such portion
of the distribution be made in the form of Common Stock to the
extent of the whole number of shares of Common Stock in his
Account. Such demand must be made in accordance with the
procedures established by the Benefit Plan Administration
Committee.
10.4 Minimum Withdrawal. No distribution under this
Article XI shall be permitted in an amount which has a value of
less than $300, unless the value of the amount available under
the selected option is less than $300, in which case such
available amount will be distributed.
10.5 Source of Withdrawal. Withdrawals shall be made in
accordance with the instructions of the Participant from each of
the Investment Funds in which the amount to be distributed is
invested. The value of the amount to be distributed under any
option listed in Section 11.1 shall be determined as soon as
practicable in accordance with the procedures established by the
Benefit Plan Administration Committee.
10.6 Requirement of Hardship.
(a) Except as provided in (e) below, a withdrawal
pursuant to Section 11.1(a)(6), in addition to the other
requirements of Article XI, shall be permitted only if the
Benefit Plan Administration Committee determines that the
withdrawal is to be made on account of an immediate and
heavy financial need of the Participant, the amount of the
withdrawal does not exceed such financial need, and the
amount of the withdrawal is not reasonably available from
other resources of the Participant.
(b) For purposes of this Section 11.6, the following
shall be deemed to be immediate and heavy financial needs:
(1) medical expenses described in Section 213(d)
of the Code, including but not limited to, expenses
for (i) the diagnosis, cure, mitigation, treatment, or
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prevention of disease, or for the purpose of affecting
any structure or function of the body; (ii)
transportation primarily for and essential to such
expenses referred to in (i) above; or (iii) insurance
(including amounts paid as premiums under part B of
Title XVIII of the Social Security Act) relating to
medical expenses referred to in (i) or (ii) above,
provided such expenses are incurred by the
Participant, the Participant's spouse or any person
whom the Participant may properly claim as a dependent
on his federal income tax return or are necessary for
such persons to obtain the medical care described
above; or
(2) Purchase (excluding mortgage payments) of a
principal residence for the Participant; or
(3) Payment of tuition and related educational
fees for the next twelve (12) months of post-secondary
education for the Participant, the Participant's
spouse or child or children, or any person the
Participant may properly claim as a dependent on his
federal income tax return; or
(4) The need to prevent eviction of the
Participant from his principal residence or
foreclosure on the mortgage of the Participant's
principal residence; or
(5) Any other need which the Commissioner of the
Internal Revenue Service, through the publication of
revenue rulings, notices, or other documents of
general applicability, deems to be immediate and
heavy.
(c) For purposes of this Section 11.6, a withdrawal
shall be deemed necessary to satisfy an immediate and heavy
financial need if:
(1) The distribution is not in excess of the
amount of the immediate and heavy financial need of
the Participant, including any amounts necessary to
pay any federal, state, or local income taxes or
penalties reasonably anticipated to result from the
distribution;
(2) The Participant has obtained all
distributions and all nontaxable loans currently
available to him under all plans maintained by an
Affiliated Employer;
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(3) The Participant agrees to suspend all
elective employer contributions and voluntary
participant contributions to all plans of an
Affiliated Employer for at least twelve (12) months
after receipt of the distribution under this Section
11.6; and
(4) The Participant agrees not to make elective
contributions to this Plan or any other plan sponsored
by an Affiliated Employer during the Participant's
taxable year immediately following the taxable year of
the hardship distribution in excess of the
Participant's applicable elective deferral limits
under Section 402(g) of the Code for such taxable year
less the amount for the taxable year of the hardship
distribution.
(d) When all suspensions pursuant to this Section
11.6 are ended, Elective Employer Contributions and/or
Voluntary Participant Contributions may be resumed by the
Participant (if the Participant is then eligible and elects
to resume such contributions at any time prior to the time
all suspensions are ended) beginning with the Participant's
first payroll period commencing after all suspensions are
ended, and Employer Matching Contributions by the Company
also shall be resumed. There shall be no make up of any
contributions by a Participant or by the Company with
respect to a period of suspension.
(e) Notwithstanding (a) above, if a Participant has
attained age 59 1/2, he shall be permitted to make a withdrawal
pursuant to Section 11.1(a)(6), even if such withdrawal is
not on account of hardship.
10.7 Loans to Participants.
(a) The Benefit Plan Administration Committee may, in
its sole discretion, direct the Trustee to make a loan or
loans from the Trust Fund to any Participant (1) who is an
Employee on the active payroll of the Company, (2) who is
receiving long-term disability payments under a plan
maintained by the Company, (3) who is on a leave of absence
authorized by the Company, or (4) who is a party in interest
as defined in Section 3(14) of ERISA. All loan applications
shall be made in accordance with the procedures established
by the Benefit Plan Administration Committee.
(b) The total amount of all loans outstanding to any
one Participant under all qualified plans maintained by an
Affiliated Employer shall not exceed the lesser of (1)
$50,000, reduced by the excess of the highest outstanding
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balance of loans from all qualified plans maintained by an
Affiliated Employer during the twelve-month period ending on
the day before a loan is made, over the outstanding balance
of any loans to the Participant from all qualified plans
maintained by an Affiliated Employer on the date the loan is
made, or (2) fifty percent (50%) of such Participant's
Account as of the Valuation Date coinciding with or next
following the date the loan application is made. The
minimum amount of any loan shall not equal less than $1,000.
(c) The Participant requesting a loan pursuant to
this Section 11.7 shall designate the order of priority of
Investment Fund(s) from which the principal amount of the
loan shall be obtained, provided that a Participant's
interest in an Investment Fund(s) shall not be applied for
loan purposes until the Participant's entire interest in
each Investment Fund with a higher designated priority has
been applied to make such loan.
(d) The Benefit Plan Administration Committee shall
adopt and follow uniform and nondiscriminatory rules in
making loans under this Plan to make certain that such loans
(1) are available to all Participants on a reasonably
equivalent basis, (2) are not made available to Highly
Compensated Employees, officers, or shareholders in an
amount greater than the amount made available to other
Participants, (3) bear a reasonable rate of interest, and
(4) are adequately secured. The repayment of such loans by
any Participant who is an Employee on the active payroll of
the Company shall be made through payroll deduction. The
minimum amount of any loan repayment shall not equal less
than $20.00, and such repayment shall extend for a period
certain of at least twelve (12) months (unless repaid in
full), but not to exceed five (5) years, expressed in any
number of whole months (including the month the loan is
made). The term of any loan may be for a period certain of
more than five (5) years, but not to exceed fifteen (15)
years, only if the proceeds of such loan are used to acquire
any dwelling used or, within a reasonable period of time, to
be used as the principal residence of the Participant.
(e) The Benefit Plan Administration Committee shall
direct the Trustee to obtain from the Participant such note
and adequate security as it may require. All loans made
pursuant to this Section 11.7 shall be secured by the
Participant's Account, and no other types of collateral may
be used to secure a loan from the Plan. Notwithstanding the
provisions of Section 16.2, in the event of failure to repay
the principal or interest according to its terms or if the
Participant's employment terminates prior to full repayment
thereof, in addition to any other remedy provided in the
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loan instruments or by law, the Benefit Plan Administration
Committee may direct the Trustee to charge against that
portion of the Participant's Account which secures the loan
the amount required to fully repay the loan. Under no
circumstances, however, shall any unpaid loan be charged
against a Participant's Account until permitted by
applicable law. This Section authorizes only the making of
bona fide loans and not distributions, and before resort is
made against a Participant's Account for his failure to
repay any loan, such other reasonable efforts to collect the
same shall be made by the Benefit Plan Administration
Committee as it deems reasonable and practical under the
circumstances.
(f) No distribution shall be made to any Participant
unless and until all unpaid loans to such Participant have
either been paid in full or deducted from the Participant's
Account.
(g) All loans made under this Section 11.7 shall be
considered earmarked investments of the Participant's
Account, and any repayment of principal and interest shall
be reinvested in accordance with the Participant's
investment direction in effect on the date of such repayment
pursuant to Article VIII of the Plan.
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ARTICLE XII
DISTRIBUTION TO PARTICIPANTS
11.1 Distribution upon Retirement.
(a) If a Participant's employment with the Affiliated
Employers is terminated as a result of his retirement
pursuant to the defined benefit pension plan of an
Affiliated Employer, the entire balance credited to his
Account as of the Valuation Date coinciding with or next
following such retirement shall be payable to him in the
manner set forth in this Section 12.1 at such time requested
by the Participant in accordance with the procedures
established by the Benefit Plan Administration Committee.
The distribution shall commence as soon as practicable after
the Valuation Date selected by the Participant in one of the
following ways:
(1) In a single distribution consisting of cash,
provided that with respect to the portion of any
distribution attributable to the Participant's
interest in the Common Stock Fund, the Participant
shall have the right to elect that such portion be
made in the form of Common Stock to the extent of the
whole number of shares of Common Stock credited to his
Account, with a cash adjustment for any fractional
shares; or
(2) In annual installments not to exceed twenty
(20) or the Participant's life expectancy, as selected
by the Participant, in the form of cash, provided that
with respect to the portion of any distribution
attributable to the Participant's interest in the
Common Stock Fund, the Participant shall have the
right to elect that such portion be made in the form
of Common Stock to the extent of the whole number of
shares of Common Stock credited to his Account, with a
cash adjustment for any fractional shares. The amount
of cash and/or the number of shares of Common Stock in
each installment shall be equal to the proportionate
value as of each Valuation Date immediately preceding
payment of the balance then to the credit of the
Participant in his Account determined by dividing the
amount credited to his Account as of such Valuation
Date by the number of payments remaining to be made.
If a Participant who is receiving installment payments
shall establish to the satisfaction of the Benefit Plan
Administration Committee, in accordance with principles and
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procedures established by the Benefit Plan Administration
Committee which are applicable to all persons similarly
situated, that a financial emergency exists in his affairs,
such as illness or accident to the Participant or a member
of his immediate family or other similar contingency, the
Benefit Plan Administration Committee may, for the purpose
of alleviating such emergency, accelerate the time of
payment of some or all of the remaining installments. If a
Participant dies before receiving all of the amount to the
credit of his Account in accordance with this paragraph (2),
the amount remaining to the credit of his Account at his
death shall be distributed to his Beneficiary as soon as
practicable in accordance with Section 12.4.
(b) Notwithstanding whether a Participant elects a
distribution of benefits or elects to defer the receipt of
the benefits under (a) above, the Benefit Plan
Administration Committee shall direct payment in a single
lump sum to such Participant if the balance of his Account
does not exceed $3,500 in accordance with the requirements
of Code Section 411(a)(11). The Benefit Plan Administration
Committee shall not cash-out any Participant whose Account
balance exceeds $3,500 without the written consent of the
Participant.
11.2 Distribution upon Disability. If a Participant's
employment with the Affiliated Employers is terminated prior to
his Normal Retirement Date by reason of his total and permanent
disability, as determined by the Social Security Administration
and evidenced in a writing provided to the Benefit Plan
Administration Committee, the entire value credited to his
Account as of the Valuation Date coinciding with or immediately
following the date the Social Security Administration determines
the Participant became totally and permanently disabled shall be
distributed upon the request of the Participant or his legal
representative to the Participant or such legal representative.
Any distribution pursuant to this Section 12.2 shall be made in a
single lump sum consisting of cash, as soon as practicable after
such Valuation Date, provided that with respect to the portion of
any distribution attributable to the Participant's interest in
the Common Stock Fund, the Participant shall have the right to
elect that such portion be made in the form of Common Stock to
the extent of the whole number of shares of Common Stock credited
to his Account, with a cash adjustment for any fractional shares.
11.3 Distribution upon Death. If a Participant's
employment with the Affiliated Employers is terminated by reason
of death, the entire balance credited to the Participant's
Account as of the Valuation Date coinciding with or next
following the date of death shall be distributed to the
Participant's surviving Beneficiary or Beneficiaries in a single
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lump sum consisting of cash, as soon as practicable after such
Valuation Date, provided that with respect to the portion of any
distribution attributable to the Participant's interest in the
Common Stock Fund, the Participant shall have the right to elect
that such portion be made in the form of Common Stock to the
extent of the whole number of shares of Common Stock credited to
his Account, with a cash adjustment for any fractional shares.
11.4 Designation of Beneficiary in the Event of Death. A
Participant may designate a Beneficiary or Beneficiaries (who may
be designated contingently) to receive all or part of the amount
credited to his Account in case of his death before his receipt
of all of his benefits under the Plan, provided that the
Beneficiary of a married Participant shall be the Participant's
Surviving Spouse, unless such Surviving Spouse shall consent in a
writing witnessed by a notary public, which writing acknowledges
the effect of the Participant's designation of a Beneficiary
other than such Surviving Spouse. However, if such Participant
establishes to the satisfaction of the Benefit Plan
Administration Committee that such written consent may not be
obtained because the Surviving Spouse cannot be located or
because of such other circumstances as the Secretary of the
Treasury may by regulations prescribe, a designation by such
Participant without the consent of the Surviving Spouse shall be
valid.
Any consent necessary under this Section 12.4 shall be valid
and effective only with respect to the Surviving Spouse who signs
the consent or, in the event of a deemed consent, only with
respect to a designated Surviving Spouse.
A designation of Beneficiary may be revoked by the
Participant without the consent of any Beneficiary (or the
Participant's Surviving Spouse) at any time before the
commencement of the distribution of benefits. A Beneficiary
designation or change or revocation of a Beneficiary designation
shall be made in accordance with the procedures established by
the Benefit Plan Administration Committee.
If no designated Beneficiary shall be living at the death of
the Participant and/or such Participant's Beneficiary designation
is not valid and enforceable under applicable law or the
procedures of the Benefit Plan Administration Committee, such
Participant's Beneficiary of Beneficiaries shall be the person or
persons in the first of the following classes of successive
preference, if then living:
(a) the Participant's spouse on the date of his
death,
(b) the Participant's children, equally,
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(c) the Participant's parents, equally,
(d) the Participant's brothers and sisters, equally,
or
(e) the Participant's executors or administrators.
Payment to such one or more persons shall completely discharge
the Plan and the Trustee with respect to the amount so paid.
11.5 Distribution upon Termination of Employment.
(a) If a Participant's employment with the Affiliated
Employers is terminated for any reason other than in
accordance with Sections 12.1, 12.2, and 12.3, the balance
to the credit of the Participant's Account shall be
distributed in a single lump sum consisting of cash,
provided that with respect to the portion of any
distribution attributable to the Participant's interest in
the Common Stock Fund, the Participant shall have the right
to elect that such portion be made in the form of Common
Stock to the extent of the whole number of shares of Common
Stock credited to his Account, with a cash adjustment for
any fractional shares. Such distribution shall be made as
soon as practicable after the Participant's termination of
employment, provided that one of the following conditions is
met:
(1) the Participant's Account Balance does not
exceed $3,500 in accordance with Code Section
411(a)(11), or
(2) in accordance with Section 12.10, the
Participant elects in writing on a form to be provided
by the Company to receive a distribution of his
Account.
(b) A Participant who does not receive a distribution
under Section 12.5(a)(1) may elect to defer the commencement
of the distribution of his Account following the termination
of his employment until a later Valuation Date, provided
that such distribution shall commence not later than the
date required under Section 12.6 of the Plan. Any deferred
distribution shall commence as soon as practicable after the
Valuation Date selected by the Participant.
11.6 Commencement of Benefits.
(a) Notwithstanding any other provision of the Plan,
and except as further provided in Section 12.6(b) below, if
the Participant does not elect to defer commencement of his
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benefit payments, the payment of his benefits shall begin at
the Participant's election no later than the sixtieth (60th)
day after the close of the Plan Year in which the latest of
the following events occurs:
(1) the Participant attains the earlier of age
sixty-five (65) or his Normal Retirement Date,
(2) the Participant's tenth (10th) anniversary
of participation under the Plan, or
(3) the Participant's separation from service
with the Affiliated Employers.
(b) In no event shall the distribution of amounts in
a Participant's Account commence later than the April 1 of
the calendar year following the calendar year in which the
Participant attains age 70 1/2, in accordance with
regulations prescribed by the Secretary of the Treasury.
Any distribution made under this Plan shall be made in
accordance with the minimum distribution requirements of Code
Section 401(a)(9), including the incidental death benefits
requirements under Code Section 401(a)(9)(G) and the Treasury
Regulations thereunder.
11.7 Transfer to an Affiliated Employer. A transfer by a
Participant from the Company to any other Affiliated Employer
shall not be deemed to be a termination of employment with the
Company.
11.8 Distributions to Alternate Payees. If the
Participant's Account under the Plan shall become subject to any
domestic relations order which (a) is a qualified domestic
relations order satisfying the requirements of Section 414(p) of
the Code and (b) requires the immediate distribution in a single
lump sum of the entire portion of the Participant's Account
required to be segregated for the benefit of an alternate payee,
then the entire interest of such alternate payee shall be
distributed in a single lump sum within ninety (90) days
following the Company's notification to the Participant and the
alternate payee that the domestic relations order is qualified
under Section 414(p) of the Code, or as soon as practicable
thereafter. Such distribution to an alternate payee shall be
made even if the Participant has not separated from the service
of the Affiliated Employers. Any other distribution pursuant to
a qualified domestic relations order shall not be made later than
the date the Participant's (or his Beneficiary's) benefit
payments otherwise commence. Such distribution to an alternate
payee shall be made only in a manner permitted under Section 12.5
of the Plan.
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11.9 Requirement for Direct Rollovers. Notwithstanding any
provision of the Plan to the contrary that would otherwise limit
a Distributee's election under this Article XII, a Distributee
may elect, at the time and in the manner prescribed by the
Benefit Plan Administration Committee, to have any portion of an
Eligible Rollover Distribution paid directly to an Eligible
Retirement Plan specified by the Distributee in a Direct
Rollover.
11.10 Consent and Notice Requirements. If the value of the
vested portion of a Participant's Account derived from the
Company and Employee contributions exceeds $3,500 determined in
accordance with the requirements of Code Section 411(a)(11), the
Participant must consent to any distribution of such vested
account balance prior to his Normal Retirement Date. The consent
of the Participant shall be obtained in writing within the
ninety-day period ending on the first day of the first period for
which an amount is payable as an annuity or in any other form
under this Plan.
The Benefit Plan Administration Committee or its delegate
shall notify the Participant of the right to defer any
distribution until the Participant's Account balance is no longer
immediately distributable. Such notification shall include a
general description of the material features and an explanation
of the relative values of the operational forms of benefit
available under the Plan in a manner that would satisfy the
notice requirements of Section 417(a)(3) of the Code; such
notification shall be provided no less than 30 days and no more
than 90 days prior to the annuity starting date.
Distributions may commence less than 30 days after the
notice required under Section 1.411(a)-11(c) of the Treasury
Regulations is given, provided that:
(a) the Benefit Plan Administration Committee informs
the Participant that the Participant has a right
to a period of at least 30 days after receiving
the notice to consider the decision of whether or
not to elect a distribution and a particular
distribution option, and
(b) the Participant, after receiving the notice,
affirmatively elects a distribution.
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ARTICLE XIII
ADMINISTRATION OF THE PLAN
12.1 Membership of Benefit Plan Administration Committee.
The Plan shall be administered by the Benefit Plan Administration
Committee, which shall consist of such individuals as may be
appointed from time to time by the Board of Directors or its
delegate.
12.2 Acceptance and Resignation. Any person appointed to
be a member of the Benefit Plan Administration Committee shall
signify his acceptance in writing to the Chairman of the Benefit
Plan Administration Committee. Any member of the Benefit Plan
Administration Committee may resign by delivering his written
resignation to the Chairman of the Benefit Plan Administration
Committee and such resignation shall become effective upon
delivery or upon any later date specified therein.
12.3 Transaction of Business. A majority of the members of
the Benefit Plan Administration Committee at the time in office
shall constitute a quorum for the transaction of business at any
meeting. Any determination or action of the Benefit Plan
Administration Committee may be made or taken by a majority of
the members present at any meeting thereof or without a meeting
by a resolution or written memorandum concurred in by a majority
of the members then in office.
12.4 Responsibilities in General. The Benefit Plan
Administration Committee shall administer the Plan and shall have
the discretionary authority, power, and the duty to take all
actions and to make all decisions necessary or proper to carry
out the Plan and to control and manage the operation and
administration of the Plan. The Benefit Plan Administration
Committee shall have the discretion to interpret the Plan,
including any ambiguities herein, and to determine the
eligibility for benefits under the Plan in its sole discretion.
The determination of the Benefit Plan Administration Committee as
to any question involving the general administration and
interpretation of the Plan shall be final, conclusive, and
binding on all persons, except as otherwise provided herein or by
law, and may be relied upon by the Company, the Trustee, the
Participants, and their Beneficiaries. Any discretionary action
to be taken under the Plan by the Benefit Plan Administration
Committee with respect to Employees and Participants or with
respect to benefits shall be uniform in their nature and
applicable to all persons similarly situated.
12.5 Benefit Plan Administration Committee as Named
Fiduciary. For the purpose of compliance with the provisions of
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ERISA, the Benefit Plan Administration Committee shall be deemed
the administrator of the Plan as the term "administrator" is
defined in ERISA, and the Benefit Plan Administration Committee
shall be, with respect to the Plan, a named fiduciary as that
term is defined in ERISA. For the purpose of carrying out its
duties, the Benefit Plan Administration Committee may, in its
discretion, allocate its responsibilities under the Plan among
its members and may, in its discretion, designate persons (in
writing or otherwise) other than members of the Benefit Plan
Administration Committee to carry out such responsibilities of
the Benefit Plan Administration Committee under the Plan as it
may see fit.
12.6 Rules for Plan Administration. The Benefit Plan
Administration Committee may make and enforce rules and
regulations for the administration of the Plan consistent with
the provisions thereof and may prescribe the use of such forms as
it shall deem appropriate for the administration of the Plan.
12.7 Employment of Agents. The Benefit Plan Administration
Committee may employ independent qualified public accountants, as
such term is defined in ERISA, who may be accountants to the
Company and any Affiliated Employer, legal counsel who may be
counsel to The Southern Company and any Affiliated Employer,
other specialists, and other persons as the Benefit Plan
Administration Committee deems necessary or desirable in
connection with the administration of the Plan. The Benefit Plan
Administration Committee and any person to whom it may delegate
(in writing or otherwise) any duty or power in connection with
the administration of the Plan, the Company and the officers and
directors thereof shall be entitled to rely conclusively upon and
shall be fully protected in any action omitted, taken, or
suffered by them in good faith in reliance upon any independent
qualified public accountant, counsel, or other specialist, or
other person selected by the Benefit Plan Administration
Committee, or in reliance upon any tables, evaluations,
certificates, opinions, or reports which shall be furnished by
any of them or by the Trustee.
12.8 Co-Fiduciaries. It is intended that to the maximum
extent permitted by ERISA, each person who is a fiduciary (as
that term is defined in ERISA) with respect to the Plan shall be
responsible for the proper exercise of his own powers, duties,
responsibilities, and obligations under the Plan and the Trust,
as shall each person designated by any fiduciary to carry out any
fiduciary responsibilities with respect to the Plan or the Trust.
No fiduciary or other person to whom fiduciary responsibilities
are allocated shall be liable for any act or omission of any
other fiduciary or of any other person delegated to carry out any
fiduciary or other responsibility under the Plan or the Trust.
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12.9 General Records. The Benefit Plan Administration
Committee shall maintain or cause to be maintained an Account
(and any separate subaccount) which accurately reflects the
interest of each Participant, as provided for in Section 9.1, and
shall maintain or cause to be maintained all necessary books of
account and records with respect to the administration of the
Plan. The Benefit Plan Administration Committee shall mail or
cause to be mailed to Participants reports to be furnished to
Participants in accordance with the Plan or as may be required by
ERISA. Any notices, reports, or statements to be given,
furnished, made, or delivered to a Participant shall be deemed
duly given, furnished, made, or delivered when addressed to the
Participant and delivered to the Participant in person or mailed
by ordinary mail to his address last communicated to the Benefit
Plan Administration Committee or its delegate or of the Company.
12.10 Liability of the Benefit Plan Administration
Committee. In administering the Plan, except as may be
prohibited by ERISA, neither the Benefit Plan Administration
Committee nor any person to whom it may delegate in writing any
duty or power in connection with administering the Plan shall be
liable for any action or failure to act except for its or his own
gross negligence or willful misconduct; nor for the payment of
any amount under the Plan; nor for any mistake of judgment made
by him or on his behalf as a member of the Benefit Plan
Administration Committee; nor for any action, failure to act, or
loss unless resulting from his own gross negligence or willful
misconduct; nor for the neglect, omission, or wrongdoing of any
other member of the Benefit Plan Administration Committee. No
member of the Benefit Plan Administration Committee shall be
personally liable under any contract, agreement, bond, or other
instrument made or executed by him or on his behalf as a member
of the Benefit Plan Administration Committee.
12.11 Reimbursement of Expenses and Compensation of Benefit
Plan Administration Committee. Members of the Benefit Plan
Administration Committee shall be reimbursed by the Company for
expenses they may individually or collectively incur in the
performance of their duties. Each member of the Benefit Plan
Administration Committee who is a full-time employee of the
Company shall serve without compensation for his services as such
member; each other member of the Benefit Plan Administration
Committee shall receive such compensation, if any, for his
services as the Board of Directors may fix from time to time.
12.12 Expenses of Plan and Trust Fund. Any expenses
directly related to the investments of the Trust Fund, such as
stock transfer taxes, brokerage commissions, investment
management fees or other charges incurred in the acquisition or
disposition of such investments, shall be paid from the Trust
Fund (or from the particular Investment Fund to which such
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expenses relate) and shall be deemed to be part of the cost of
such securities or deducted in computing the proceeds therefrom,
as the case may be. The expenses of establishment and
administration of the Plan and the Trust Fund, including all fees
of the Trustee, auditors, and counsel, shall be paid by the
Company. Taxes, if any, on any assets held or income received by
the Trustee and transfer taxes on the transfer of Common Stock
from the Trustee to a Participant or his Beneficiary shall be
charged appropriately against the Accounts of Participants as the
Benefit Plan Administration Committee shall determine.
12.13 Responsibility for Funding Policy. The Benefit Plan
Administration Committee shall have responsibility for providing
a procedure for establishing and carrying out a funding policy
and method for the Plan consistent with the objectives of the
Plan and the requirements of Title I of ERISA.
12.14 Management of Assets. The Benefit Plan Administration
Committee shall have responsibility with respect to the control
or management of the assets of the Plan, except to the extent
that an investment advisor (who qualifies as an Investment
Manager as that term is defined in ERISA) who may be appointed by
the Benefit Plan Administration Committee shall have
responsibility for the management of the assets of the Plan, or
some part thereof (including the powers to acquire and dispose of
the assets of the Plan, or some part thereof).
12.15 Notice and Claims Procedures. Consistent with the
requirements of ERISA and the regulations thereunder of the
Secretary of Labor from time to time in effect, the Benefit Plan
Administration Committee shall:
(a) provide adequate notice in writing to any
Participant or Beneficiary whose claim for benefits under
the Plan has been denied, setting forth specific reasons for
such denial, written in a manner calculated to be understood
by such Participant or Beneficiary, and
(b) afford a reasonable opportunity to any
Participant or Beneficiary whose claim for benefits has been
denied for a full and fair review of the decision denying
the claim.
12.16 Bonding. Unless otherwise determined by the Board of
Directors or required by law, no member of the Benefit Plan
Administration Committee shall be required to give any bond or
other security in any jurisdiction.
12.17 Multiple Fiduciary Capacities. Any person or group of
persons may serve in more than one fiduciary capacity with
respect to the Plan, and any fiduciary with respect to the Plan
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may serve as a fiduciary with respect to the Plan in addition to
being an officer, employee, agent, or other representative of a
party in interest, as that term is defined in ERISA.
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ARTICLE XIV
TRUSTEE OF THE PLAN
13.1 Trustee. The Company has entered into a Trust
Agreement with the Trustee to hold the funds necessary to provide
the benefits set forth in the Plan. If the Board of Directors so
determines, the Company may enter into a Trust Agreement or Trust
Agreements with additional trustees. Any Trust Agreement may be
amended by the Company from time to time in accordance with its
terms. Any Trust Agreement shall provide, among other things,
that all funds received by the Trustee thereunder will be held,
administered, invested, and distributed by the Trustee, and that
no part of the corpus or income of the Trust held by the Trustee
shall be used for or diverted to purposes other than for the
exclusive benefit of Participants or their Beneficiaries, except
as otherwise provided in the Plan. Any Trust Agreement may also
provide that the investment and reinvestment of the Trust Fund,
or any part thereof may be carried out in accordance with
directions given to the Trustee by any Investment Manager or
Investment Managers (as that term is defined in ERISA) who may be
appointed by the Benefit Plan Administration Committee. The
Board of Directors may remove any Trustee or any successor
Trustee, and any Trustee or any successor Trustee may resign.
Upon removal or resignation of a Trustee, the Board of Directors
shall appoint a successor Trustee.
13.2 Purchase of Common Stock. As soon as practicable
after receipt of funds applicable to the purchase of Common
Stock, the Trustee shall purchase Common Stock or cause Common
Stock to be purchased. Such Common Stock may be purchased on the
open market or by private purchase (including private purchases
directly from The Southern Company); provided that (a) no private
purchase may be made at any price greater than the last sale
price or highest current independent bid price, whichever is
higher, for Common Stock on the New York Stock Exchange, plus an
amount equal to the commission payable in a stock exchange
transaction; (b) if such private purchase shall be a purchase of
Common Stock directly from The Southern Company, no commission
shall be paid with respect thereto; and (c) the Trustee may
purchase Common Stock directly from The Southern Company under
the Dividend Reinvestment and Stock Purchase Plan of The Southern
Company, as from time to time amended, or under any other similar
plan made available to holders of record of shares of Common
Stock which may be in effect from time to time, at the purchase
price provided for in such plan. The Trustee may hold in cash,
and may temporarily invest in short-term United States
obligations, commercial paper, or certificates of deposit, funds
applicable to the purchase of Common Stock pending investment of
such funds in such Common Stock.
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13.3 Voting of Common Stock. Before each annual or special
meeting of shareholders of The Southern Company, there shall be
sent to each Participant a copy of the proxy soliciting material
for the meeting, together with a form requesting instructions to
the Trustee on how to vote the Common Stock represented by the
amount credited to such Participant's Account at the end of the
month immediately preceding the record date of the Common Stock.
Upon receipt of such instructions by the Trustee or its
designated agent, the Trustee shall vote such Common Stock as
instructed by the Participant. If a Participant does not provide
the Trustee or its designated agent with timely voting
instructions for the Trustee, the Benefit Plan Administration
Committee or its delegate may direct the Trustee how to vote such
Participant's shares. If the Benefit Plan Administration
Committee or its delegate does not provide the Trustee or its
designated agent with timely voting instructions, the Trustee, if
required to do so by ERISA, may vote such Participant's shares.
The Benefit Plan Administration Committee or its delegate may
direct the Trustee with respect to voting unallocated shares of
Common Stock, if any. If the Benefit Plan Administration
Committee or its delegate does not provide the Trustee or its
designated agent with timely voting instructions, the Trustee, if
required to do so by ERISA, may vote such unallocated shares.
13.4 Voting of Other Investment Fund Shares. The Benefit
Plan Administration Committee or its delegate may direct the
Trustee with respect to voting the shares in any Investment Fund
other than the Company Stock Fund. If the Benefit Plan
Administration Committee does not provide the Trustee or its
designated agent with timely voting instructions, the Trustee, if
required to do so by ERISA, may vote such shares.
13.5 Uninvested Amounts. The Trustee may keep uninvested
an amount of cash sufficient in its opinion to enable it to carry
out the purposes of the Plan.
13.6 Independent Accounting. The Board of Directors shall
select a firm of independent public accountants to examine and
report annually on the financial position and the results of
operation of the Trust forming a part of the Plan.
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ARTICLE XV
AMENDMENT AND TERMINATION OF THE PLAN
14.1 Amendment of the Plan. The Plan may be amended or
modified by the Board of Directors pursuant to its written
resolutions at any time and from time to time; provided, however,
that no such amendment or modification shall make it possible for
any part of the corpus or income of the Trust Fund to be used for
or diverted to purposes other than for the exclusive benefit of
Participants or their Beneficiaries under the Plan, including
such part as is required to pay taxes and administration expenses
of the Plan. The Plan may also be amended or modified by the
Benefit Plan Administration Committee (a) if such amendment or
modification does not involve a substantial increase in cost to
the Company, or (b) as may be necessary, proper, or desirable in
order to comply with laws or regulations enacted or promulgated
by any federal or state governmental authority and to maintain
the qualification of the Plan under Sections 401(a) and 501(a) of
the Code and the applicable provisions of ERISA.
No amendment to the Plan shall have the effect of decreasing
a Participant's vested interest in his Account, determined
without regard to such amendment, as of the later of the date
such amendment is adopted or the date it becomes effective. In
addition, if the vesting schedule of the Plan is amended, any
Participant who has completed at least three (3) Years of Service
and whose vested interest is at any time adversely affected by
such amendment may elect to have his vested interest determined
without regard to such amendment during the election period
defined under Section 411(a)(10) of the Code. Finally, no
amendment shall eliminate an optional form of benefit in
violation of Code Section 411(d)(6).
14.2 Termination of the Plan. It is the intention of the
Company to continue the Plan indefinitely. However, the Board of
Directors pursuant to its written resolutions may at any time and
for any reason suspend or terminate the Plan or suspend or
discontinue the making of contributions of all Participants and
of contributions by the Company.
In the event of termination of the Plan or partial
termination or upon complete discontinuance of contributions
under the Plan by the Company, the amount to the credit of the
Account of each Participant affected by such termination or
discontinuance shall be determined as of the next Valuation Date
and shall be distributed to him or his Beneficiary thereafter at
such time or times and in such nondiscriminatory manner as is
determined by the Benefit Plan Administration Committee in
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<PAGE>
compliance with the restrictions on distributions set forth in
Code Section 401(k).
14.3 Merger or Consolidation of the Plan. The Plan shall
not be merged or consolidated with nor shall any assets or
liabilities thereof be transferred to any other plan unless each
Participant of the Plan would (if the Plan then terminated)
receive a benefit immediately after the merger, consolidation, or
transfer which is equal to or greater than the benefit he would
have been entitled to receive immediately prior to the merger,
consolidation, or transfer (if the Plan had then terminated).
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<PAGE>
ARTICLE XVII
GENERAL PROVISIONS
15.1 Plan Not an Employment Contract. The Plan shall not
be deemed to constitute a contract between an Affiliated Employer
and any Employee, nor shall anything herein contained be deemed
to give any Employee any right to be retained in the employ of
the Company or to interfere with the right of the Company to
discharge any Employee at any time and to treat him without
regard to the effect which such treatment might have upon him as
a Participant.
15.2 No Right of Assignment or Alienation. Except as may
be otherwise permitted or required by law, no right or interest
in the Plan of any Participant or Beneficiary and no distribution
or payment under the Plan to any Participant or Beneficiary shall
be subject in any manner to anticipation, alienation, sale,
transfer (except by death), assignment (either at law or in
equity), pledge, encumbrance, charge, attachment, garnishment,
levy, execution, or other legal or equitable process, whether
voluntary or involuntary, and any attempt to so anticipate,
alienate, sell, transfer, assign, pledge, encumber, charge,
attach, garnish, levy, or execute or enforce any other legal or
equitable process against the same shall be void, nor shall any
such right, interest, distribution, or payment be in any way
liable for or subject to the debts, contracts, liabilities,
engagements, or torts of any person entitled to such right,
interest, distribution, or payment. If any Participant or
Beneficiary is adjudicated bankrupt or purports to anticipate,
alienate, sell, transfer, assign, pledge, encumber, or charge any
such right, interest, distribution, or payment, voluntarily or
involuntarily, or if any action shall be taken which is in
violation of the provisions of the immediately preceding
sentence, the Benefit Plan Administration Committee may hold or
apply or cause to be held or applied such right, interest,
distribution, or payment or any part thereof to or for the
benefit of such Participant or Beneficiary in such manner as is
in accordance with applicable law.
Notwithstanding the above, the Benefit Plan Administration
Committee and the Trustee shall comply with any domestic
relations order (as defined in Section 414(p)(1)(B) of the Code)
which is a qualified domestic relations order satisfying the
requirements of Section 414(p) of the Code. The Benefit Plan
Administration Committee shall establish procedures for (a)
notifying Participants and alternate payees who have or may have
an interest in benefits which are the subject of domestic
relations orders, (b) determining whether such domestic relations
orders are qualified domestic relations orders under Section
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<PAGE>
414(p) of the Code, and (c) distributing benefits which are
subject to qualified domestic relations orders.
15.3 Payment to Minors and Others. If the Benefit Plan
Administration Committee determines that any person entitled to a
distribution or payment from the Trust Fund is an infant or
incompetent or is unable to care for his affairs by reason of
physical or mental disability, it may cause all distributions or
payments thereafter becoming due to such person to be made to any
other person for his benefit, without responsibility to follow
the application of payments so made. Payments made pursuant to
this provision shall completely discharge the Company, the
Trustee, and the Benefit Plan Administration Committee with
respect to the amounts so paid. No person shall have any rights
under the Plan with respect to the Trust Fund, or against the
Trustee or the Company, except as specifically provided herein.
15.4 Source of Benefits. The Trust Fund established under
the Plan shall be the sole source of the payments or
distributions to be made in accordance with the Plan. No person
shall have any rights under the Plan with respect to the Trust
Fund, or against the Trustee or the Company, except as
specifically provided herein.
15.5 Unclaimed Benefits. If the Benefit Plan
Administration Committee is unable, within five (5) years after
any distribution becomes payable to a Participant or Beneficiary,
to make or direct payment to the person entitled thereto because
the identity or whereabouts of such person cannot be ascertained,
notwithstanding the mailing of due notice to such person at his
last known address as indicated by the records of either the
Benefit Plan Administration Committee or the Company, then such
benefit or distribution will be disposed of as follows:
(a) If the whereabouts of the Participant is unknown
to the Benefit Plan Administration Committee, distribution
will be made to the Participant's Beneficiary or
Beneficiaries.
Payment to such one or more persons shall completely
discharge the Company, the Trustee, and the Benefit Plan
Administration Committee with respect to the amounts so
paid.
(b) If none of the persons described in (a) above,
can be located, then the benefit payable under the Plan
shall be forfeited and shall be applied to reduce future
Employer Matching Contributions. Notwithstanding the
foregoing sentence, such benefit shall be reinstated if a
claim is made by the Participant or Beneficiary for the
forfeited benefit.
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15.6 Governing Law. The provisions of the Plan and the
Trust shall be construed, administered, and enforced in
accordance with the laws of the State of Georgia, except to the
extent such laws are preempted by the laws of the United States.
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IN WITNESS WHEREOF, the Company has caused this Southern
Electric International, Inc. Savings Plan for Covered Employees
effective as of April 1, 1995, to be executed this day of
, 1995.
SOUTHERN ELECTRIC INTERNATIONAL, INC.
By:
Its:
(CORPORATE SEAL)
Attest:
By:
Its:
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<PAGE>
TROUTMAN SANDERS
600 PEACHTREE STREET, SUITE 5200
ATLANTA, GA 30308
404-885-3000
March 31, 1995
The Southern Company
64 Perimeter Center East
Atlanta, Georgia 30346
Re: The Southern Company
Registration Statement on Form S-8
Ladies and Gentlemen:
We have examined the above-captioned registration statement
and related prospectus proposed to be filed by The Southern
Company ("Southern") with the Securities and Exchange Commission
under the Securities Act of 1933 for the registration of shares
of its common stock, par value $5 per share (the "Stock"), to be
offered pursuant to the Southern Electric International, Inc.
Savings Plan for Covered Employees (the "Plan"). We have also
examined certified copies of Southern's Certificate of
Incorporation, as amended, and of its by-laws and are familiar
with all proceedings relating to the issuance and sale of the
Stock.
We are of the opinion that:
(a) Southern is a corporation duly organized and
existing under the laws of the State of Delaware, is
domesticated under the laws of the State of Georgia, and is
qualified to do business as a foreign corporation under the
laws of the State of Alabama.
(b) Upon compliance with the relevant provisions of
the Securities Act of 1933, upon issuance by the Securities
and Exchange Commission of an appropriate order or orders
under the Public Utility Holding Company Act of 1935, and
upon compliance with the securities or blue sky laws of any
jurisdiction applicable thereto, Southern may legally issue
and sell the Stock in accordance with the Plan without
obtaining the consent or approval of any other governmental
authority.
(c) When the necessary consents or approvals as
referred to in paragraph (b) hereinabove have been obtained,
and when certificates for the Stock have been executed by
Southern, countersigned and registered by the transfer agent
and registrar and delivered for a consideration in
accordance with the provisions of the Plan, the Stock will
be valid and legally issued, fully paid and nonassessable
<PAGE>
The Southern Company
March 31, 1995
Page 2
shares of Southern, and the holders thereof will be entitled
to the rights and privileges appertaining thereto as set
forth in Southern's Certificate of Incorporation, as
amended.
We hereby consent to the filing of this opinion as an
exhibit to the registration statement.
Very truly yours,
/s/ Troutman Sanders
<PAGE>
ARTHUR ANDERSEN LLP
Exhibit 23(b)
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement on Form
S-8, related to the Southern Electric International, Inc. Savings
Plan for Covered Employees, of our reports dated February 15,
1995 on the financial statements of The Southern Company and the
related financial statement schedules included in The Southern
Company's Form 10-K for the year ended December 31, 1994 and to
all references to our Firm included in this registration
statement.
/s/ ARTHUR ANDERSEN LLP
Atlanta, Georgia
March 31, 1995<PAGE>
Exhibit 24
February 20, 1995
A. W. Dahlberg, W. L. Westbrook, Tommy Chisholm and Wayne Boston
Dear Sirs:
The Southern Company proposes to file a registration
statement or statements under the Securities Act of 1933, as
amended, with the Securities and Exchange Commission with respect
to the issuance by this Company of additional shares of its
common stock pursuant to the Southern Electric International,
Inc. Savings Plan for Covered Employees.
The Southern 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 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 in connection with the
foregoing such registration statement or statements and
appropriate amendment or amendments (including post-effective
amendments) thereto, to be accompanied by a prospectus or
prospectuses and any appropriately amended or supplemented
prospectus or prospectuses and any necessary exhibits.
Yours very truly,
THE SOUTHERN COMPANY
By /s/A. W. Dahlberg, President<PAGE>
- 2 -
/s/Elmer B. Harris
/s/W. P. Copenhaver /s/Earl D. McLean, Jr.
______________________________
/s/A. D. Correll William A. Parker, Jr.
/s/A. W. Dahlberg /s/William J. Rushton, III
______________________________
/s/Paul J. DeNicola Gloria M. Shatto
/s/Jack Edwards /s/Herbert Stockham
/s/H. Allen Franklin /s/W. L. Westbrook
/s/Bruce S. Gordon /s/Tommy Chisholm
/s/L. G. Hardman III /s/W. Dean Hudson<PAGE>
Extract from minutes of meeting of the board of directors of The
Southern Company.
- - - - - - - - - -
RESOLVED FURTHER: That for the purpose of signing the
registration statement or statements under the Securities
Act of 1933, as amended, to be filed with the Securities and
Exchange Commission with respect to the issuance by this
Company of additional shares of its common stock pursuant to
the Plan and of remedying any deficiencies with respect
thereto by appropriate amendment or amendments (including
post-effective amendments), this Company, the members of its
board of directors, and its officers, are authorized to give
their several powers of attorney to A. W. Dahlberg, W. L.
Westbrook, Tommy Chisholm, and Wayne Boston.
- - - - - - - - - -
The undersigned officer of The Southern Company does
hereby certify that the foregoing is a true and correct copy of
resolution duly and regularly adopted at a meeting of the board
of directors of The Southern Company, duly held on February 20,
1995, 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 March 31, 1995 THE SOUTHERN COMPANY
By /s/Tommy Chisholm
Secretary<PAGE>
