FOURTH AMENDMENT TO THE
SOUTHERN COMPANY EMPLOYEE STOCK OWNERSHIP PLAN
WHEREAS, the Employee Stock Ownership Plan Committee ("Committee")
heretofore adopted the amendment and restatement of The Southern Company
Employee Stock Ownership Plan ("Plan"), effective as of January 1, 1997;
WHEREAS, Southern Energy Resources, Inc. ("SERI"), an Employing Company
under the Plan, will become the employer of certain individuals currently
employed by Southern Company Energy Marketing, L.P. ("SCEM") following a
reorganization of SCEM;
WHEREAS, the Southern Company ("Southern") anticipates that in 2001 it
will distribute pro rata to the Southern shareholders all of the stock of
Southern Energy, Inc. ("SEI") held by Southern pursuant to a tax-free spin-off
under Section 355 of the Internal Revenue Code;
WHEREAS, in connection with such transaction, Southern and SEI have
entered into an Employee Matters Agreement ("Agreement") to allocate between
them assets, liabilities and responsibilities with respect to certain employee
compensation, benefit plans and programs, and certain employment matters;
WHEREAS, the Committee desires to amend the Plan to exclude the former
employees of SCEM from participating in the Plan by virtue of their employment
with SERI;
WHEREAS, the Committee desires to amend the Plan to address the
spin-off of SEI from Southern, including making such changes as are necessary
pursuant to the Agreement;
WHEREAS, the Committee desires to amend the Plan to make certain other
technical changes and to reflect recent changes in the law; and
WHEREAS, the Committee is authorized pursuant to Section 11.1 of the
Plan to amend the Plan at any time, provided that the amendment does not involve
a substantial increase in cost to any Employing Company or is necessary or
desirable to comply with the laws and regulations applicable to the Plan.
NOW, THEREFORE, the Committee hereby amends the Plan as follows, to be
effective as of the dates indicated:
1.
Sections 2.14 and 2.15 of the Plan shall be eliminated in their
entirety, effective as of January 1, 2001. Each subsequent Section in Article II
shall remain as currently numbered until such time as the Plan is amended and
restated.
2.
Section 2.20 of the Plan shall be amended to read as follows, effective
as of December 22, 2000:
2.20 "Eligible Employee" shall mean an Employee who is
employed by an Employing Company and (a) who was eligible to be
included in the Plan on January 1, 1991, or (b) who is a regular
full-time, regular part-time, or cooperative education employee other
than:
(1) an Employee who is treated as such solely by
reason of the "leased employee" rules of Code Section 414(n)
such that, pursuant to an agreement between an Employing
Company and any other person, such individual has performed
services for the Employing Company (or the Employing Company
and related persons as described in Code Section 414(n)(6)) on
a substantially full-time basis for a period of at least one
year and such services were performed under the primary
direction or control of the Employing Company;
(2) any Employee who is represented by a collective
bargaining agent unless the representatives of his bargaining
unit and the Employing Company mutually agree to participation
in the Plan subject to its terms by members of his bargaining
unit;
(3) an individual who is a cooperative education
employee and who first performs an Hour of Service on or after
January 1, 1995;
(4) an individual who is classified by the Employing
Company as a temporary employee (who was not eligible to be
included in the Plan on January 1, 1991) or an independent
contractor, regardless of whether such classification is
determined to be in error. Effective September 1, 1998, any
individual classified by the Employing Company as a temporary
employee shall be excluded from the Plan, regardless of any
prior inclusion in the Plan and regardless of whether the
"temporary employee" classification is determined to be in
error;
(5) an Employee who is described in Section 3.8 of
the Plan; or
(6) an individual, who would otherwise be eligible to
participate in the Plan by virtue of his employment by SERI,
but who (i) was an employee of SCEM on December 22, 2000, (ii)
was hired by SERI on or after December 23, 2000, and who was a
former employee of SCEM, or (iii) was hired by SERI on or
after December 23, 2000, who is employed in the Americas Group
and whose job function is indicated on Exhibit A attached
hereto.
3.
Paragraph (6) of Section 2.20 of the Plan shall be amended to read as
follows, effective as of the Group Status Change Date as defined in the
Agreement:
(6) an individual who is employed by SERI.
4.
Two new definition Sections shall be added to the Plan to read as
follows, effective as of December 22, 2000:
2.53 "SCEM" shall mean Southern Company Energy Marketing,
L.P.
2.54 "SERI" shall mean Southern Energy Resources, Inc.
5.
Two new definition Sections shall be added to the Plan to read as
follows, effective as of the Group Status Change Date as defined in the
Agreement:
2.55 "SEI" shall mean Southern Energy, Inc., any subsidiary of
Southern Energy, Inc., or any successor thereto.
2.56 "SEI Stock" shall mean the common stock of SEI.
6.
A new sentence shall be added to Section 6.2 of the Plan to read as
follows, effective as of January 1, 2000.
Notwithstanding the foregoing, in no event shall a Participant who is
employed by SCEM or SERI on December 31, 2000 receive an allocation of
Common Stock for the Plan Year ending on such date.
7.
Section 6.3 of the Plan shall be amended to read as follows, effective
as of January 1, 2000:
6.3 Section 415 Limitations. 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:
(a) twenty-five percent (25%) of the Participant's
compensation (as defined in Code Section 415(c)(3) and any
rulings and regulations thereunder) in the Limitation Year; or
(b) $30,000 (as adjusted pursuant to Code Section
415(d)(1)(C)).
The Annual Addition for any Plan Year beginning before
January 1, 1987 shall not be recomputed to treat all employee
contributions as an Annual Addition.
8.
Section 6.5 of the Plan shall be amended to read as follows, effective
as of January 1, 2000:
6.5 Combination of Plans. If an Employee participates in
more than one defined contribution plan maintained by an Affiliated
Employer and his Annual Additions exceed the limitations of Section
6.3, corrective adjustments shall be made first under The Southern
Company Employee Savings Plan and then, to the extent necessary, under
The Southern Company Performance Sharing Plan and then, to the extent
necessary, under this Plan.
9.
The second sentence of the second paragraph of Section 6.6 of the Plan
shall be amended as follows, effective as of the Group Status Change Date as
defined in the Agreement:
Except as provided in Section 6.10, if a dividend or other distribution
on the Common Stock allocated to a Participant's Account is of property
other than cash or additional shares of Common Stock, the Trustee shall
sell such property for an amount not less than its fair market value as
determined by the Trustee and reinvest the proceeds of such sale in
shares of Common Stock pursuant to this Section 6.6.
10.
A new Section 6.10 shall be added to the Plan to read as follows,
effective as of the Group Status Change Date as defined in the Agreement:
6.10 Transfer of SEI Stock. Upon the distribution by the
Southern Company to its shareholders of the SEI Stock held by the
Southern Company pursuant to a tax-free spin-off under Code Section 355
or such similar transaction, all SEI Stock received by the Plan on
behalf of a Participant shall be transferred to a "Transferred ESOP
Account" established for such Participant under The Southern Company
Employee Savings Plan. The transfer of SEI Stock shall be made
contemporaneously with or as soon as administratively practicable
following such transaction.
11.
The phrase ", as provided in regulations prescribed by the Secretary of
the Treasury" shall be added to the end of the last sentence of Section 11.1 of
the Plan, effective as of September 5, 2000.
12.
A new Section 11.4 shall be added to the Plan to read as follows,
effective as of the Group Status Change Date as defined in the Agreement:
11.4 Transfer of Plan Assets. Notwithstanding any provision of
the Plan to the contrary, upon the distribution by the Southern Company
to its shareholders of the SEI Stock held by the Southern Company
pursuant to a tax-free spin-off under Code Section 355 or such similar
transaction, the Accounts of certain Participants may be transferred to
a retirement plan established by SEI which is intended to constitute a
qualified retirement plan under Code Section 401(a) pursuant to the
Employee Matters Agreement entered into between the Southern Company
and SEI ("Agreement"). The Participants whose Accounts shall be
transferred, if any, shall be identified in accordance with the
Agreement. The Committee shall determine the time of such transfers and
shall establish such rules and procedures as its deems necessary or
appropriate to effect the transfers, except that all actions with
respect to the transfers shall be taken in a manner consistent with the
Agreement.
13.
Section 12.4 of the Plan shall be deleted in its entirety, effective as
of January 1, 2000.
14.
Southern Energy Resources, Inc. shall be removed as an Employing
Company in Appendix A of the Plan, effective as of the Group Status Change Date
as defined in the Agreement.
15.
Except as amended herein by this Fourth Amendment, the Plan shall
remain in full force and effect as amended and restated by the Company prior to
the adoption of this Fourth Amendment.
IN WITNESS WHEREOF, Southern Company Services, Inc., through the duly
authorized members of the Employee Stock Ownership Plan Committee, has adopted
this Fourth Amendment to The Southern Company Employee Stock Ownership Plan this
____ day of ___________________, 2000.
EMPLOYEE STOCK OWNERSHIP PLAN COMMITTEE: