File No. 70-8595
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 2
to
Form U-1
APPLICATION OR DECLARATION
under
The Public Utility Holding Company Act of 1935
THE SOUTHERN COMPANY
64 Perimeter Center East
Atlanta, Georgia 30346
(Name of company or companies filing this statement
and addresses of principal executive offices)
THE SOUTHERN COMPANY
(Name of top registered holding company parent
of each applicant or declarant)
Tommy Chisholm
The Southern Company
64 Perimeter Center East
Atlanta, Georgia 30346
(Names and addresses of agents for service)
The Commission is requested to mail signed copies of all orders,
notices and communications to:
W. L. Westbrook John D. McLanahan, Esq.
Financial Vice President Troutman Sanders
The Southern Company NationsBank Plaza, Suite 5200
64 Perimeter Center East 600 Peachtree Street
Atlanta, Georgia 30346 Atlanta, Georgia 30308
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INFORMATION REQUIRED
Item 3. Applicable Statutory Provisions.
Item 3 is hereby amended by adding the following thereto:
"The proposed transaction is also subject to Rule 54. Under Rule 54, in
determining whether to approve the issue or sale of a security by a registered
holding company for purposes other than the acquisition of an "exempt wholesale
generator" or "foreign utility company," or other transactions by such
registered holding company or its subsidiaries other than with respect to
"exempt wholesale generators" or "foreign utility companies," the Commission
shall not consider the effect of the capitalization or earnings of any
subsidiary which is an "exempt wholesale generator" or a "foreign utility
company" upon the registered holding company system if Rules 53(a), (b) and (c)
are satisfied. In that regard, assuming consummation of the transaction proposed
in this application, all of the conditions set forth in Rule 53(a) are and will
be satisfied and none of the conditions set forth in Rule 53(b) exists or, as a
result thereof, will exist.
Rule 53(a)(1): Assuming full utilization of $500 million of proceeds of
the sale of Common Stock (as authorized in HCAR Nos. 25980 and 26098) and/or the
use of up to $500 million of the proceeds of short-term borrowings and/or
commercial paper sales (as authorized in HCAR No. 26004), to make investments in
"exempt wholesale generators" and "foreign utility companies," or the guaranty
by Southern of up to $500 million of securities of any "exempt wholesale
generators" or "foreign utility companies" (as authorized by HCAR No. 25980),
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the combination of which may not exceed $500 million, Southern's "aggregate
investment" in such entities would be approximately 26.5% of "consolidated
retained earnings," as defined in Rule 53(a)(1)(ii), of Southern, determined as
follows: At December 31, 1994, Southern had invested, directly or indirectly, an
aggregate of $522.7 million in "exempt wholesale generators" and "foreign
utility companies,"1 and had utilized for this purpose approximately $209.0
million of the authorized proceeds of common stock, debt and/or guarantees. The
average of the consolidated retained earnings of Southern reported on Form 10-K
or Form 10-Q, as applicable, for the four consecutive quarters ended December
31, 30, 1994, is $3.075 billion. Southern's "aggregate investment," on a pro
forma basis, expressed as a percentage of "consolidated retained earnings," is
approximately 26.5% ($522.7 million + $291.0 million divided by $3.075 billion).
Rule 53(a)(2): Southern maintains books and records enabling it to
identify investments in and earnings from each "exempt wholesale generator" and
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1 These investments were in companies or partnerships that are "exempt wholesale
generators," as defined in Section 32, operating or constructing facilities in
Hawaii, Virginia and Trinidad and Tobago, and in "foreign utility companies," as
defined in Section 33, operating in The Grand Bahamas, Chile and Argentina.
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"foreign utility company" in which it directly or indirectly holds an interest.
In addition, each domestic "exempt wholesale generator" in which Southern holds
an interest maintains its books and records and prepares its financial
statements in conformity with U.S. generally accepted accounting principles
("GAAP"). The books and records and financial statements of each "foreign
utility company" in which Southern holds an interest (including those that are
"majority-owned subsidiaries" and those that are not) are maintained and
prepared in conformity with GAAP. All of such books and records and financial
statements will be made available to the Commission, in English, upon request.
Rule 53(a)(3): No more than 2% of the employees of Southern's operating
utility subsidiaries will, at any one time, directly or indirectly, render
services to "exempt wholesale generators" and "foreign utility companies." Based
on current staffing levels of Southern's domestic operating utility subsidiaries
(such companies currently employ, in the aggregate, approximately 27,000
salaried and hourly employees), no more than 540 employees of these companies,
in the aggregate, determined on a full-time-equivalent basis, will be utilized
at any one time in rendering services directly or indirectly to "exempt
wholesale generators" and "foreign utility companies." By order dated December
30, 1994 (HCAR No. 26212), certain of Southern's subsidiaries have been
authorized to render services to "exempt wholesale generators" and "foreign
utility companies," as required by Rule 53(a).
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Rule 53(a)(4): Southern is simultaneously submitting a copy of this
Application or Declaration, and will submit copies of any Rule 24 certificates
required hereunder, as well as a copy of Southern's Form U5S, to the Federal
Energy Regulatory Commission and to the appropriate public service commission(s)
having jurisdiction over the retail rates of Southern's operating utility
subsidiaries.
In addition, Southern states that the provisions of Rule 53(a) are not
made inapplicable to the authorization herein requested by reason of the
provisions of Rule 53(b).
Rule 53(b)(1): Neither Southern nor any subsidiary of Southern is the
subject of any pending bankruptcy or similar proceeding.
Rule 53(b)(2): Southern's average consolidated retained earnings for
the four most recent quarterly periods ($3.075 billion) represented an increase
of approximately $56 million in the average consolidated retained earnings for
the previous four quarterly periods ($3.019 billion).
Rule 53(b)(3): In the previous fiscal year, Southern did not report any
operating losses attributable to its direct or indirect investments in "exempt
wholesale generators" and "foreign utility companies."
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SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, the undersigned company has duly caused this amendment to be signed on
its behalf by the undersigned thereunto duly authorized.
Dated: April 3, 1995
THE SOUTHERN COMPANY
By: /s/Tommy Chisholm
Tommy Chisholm
Secretary
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