Exhibit 10(f)34
SAVANNAH ELECTRIC AND POWER COMPANY
CHANGE IN CONTROL
BENEFIT PLAN DETERMINATION POLICY
Troutman Sanders LLP
Bank of America Plaza, Suite 5200
600 Peachtree Street, N.E.
Atlanta, Georgia 30308
SAVANNAH ELECTRIC AND POWER COMPANY
CHANGE IN CONTROL
BENEFIT PLAN DETERMINATION POLICY
ARTICLE I - PURPOSE AND ADOPTION OF POLICY
1.1 Adoption of Policy. Savannah Electric and Power Company hereby
adopts this Savannah Electric and Power Company Change in Control Benefit Plans
Policy, effective October 26, 2000.
1.2 Purpose. The Policy is designed to govern the determination of a
Change in Control of Southern or the Company, and the benefits to be provided to
employees of the Company under certain employee benefit plans.
ARTICLE II - DEFINITIONS
2.1 "Administrative Committee" shall mean the committee designated in
accordance with Article VII.
2.2 "Beneficial Ownership" shall mean beneficial ownership within the
meaning of Rule 13d-3 promulgated under the Exchange Act.
2.3 "Business Combination" shall mean a reorganization, merger or
consolidation of Southern or sale or other disposition of all or substantially
all of the assets of Southern.
2.4 "Change in Control" shall mean a Savannah Change in Control and/or
a Southern Change in Control, as applicable.
2.5 "Company" shall mean Savannah Electric and Power Company, its
successors and assigns.
2.6 "Consummation" shall mean the completion of the final act necessary
to complete a transaction as a matter of law, including, but not limited to, any
required approvals by the corporation's shareholders and board of directors, the
transfer of legal and beneficial title to securities or assets and the final
approval of the transaction by any applicable domestic or foreign governments or
agencies.
2.7 "Control" shall mean, in the case of a corporation, Beneficial
Ownership of more than 50% of the combined voting power of the corporation's
Voting Securities, or in the case of any other entity, Beneficial Ownership of
more than 50% of such entity's voting equity interests.
2.8 "Employee Benefit Plan(s)" shall mean, collectively, the Deferred
Compensation Plan for Key Employees of Savannah Electric and Power Company, the
Deferred Compensation Plan for Directors of Savannah Electric and Power Company
and the Supplemental Executive Retirement Plan of Savannah Electric and Power
Company, as may be amended from time to time in accordance with their terms.
2.9 "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
2.10 "Group" shall have the meaning set forth in Section 14(d) of the
Exchange Act.
2.11 "Incumbent Board" shall mean those individuals who constitute the
Southern Board as of October 19, 1998, plus any individual who shall become a
director subsequent to such date whose election or nomination for election by
Southern's shareholders was approved by a vote of at least 75% of the directors
then comprising the Incumbent Board. Notwithstanding the foregoing, no
individual who shall become a director of the Southern Board subsequent to
October 19, 1998, whose initial assumption of office occurs as a result of an
actual or threatened election contest (within the meaning of Rule 14a-11 of the
Regulations promulgated under the Exchange Act) with respect to the election or
removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Southern Board shall be a
member of the Incumbent Board.
2.12 "Person" shall mean any individual, entity or group within the
meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act.
2.13 "Preliminary Change in Control" shall mean the occurrence of any
of the following, as determined by the Southern Committee and the Chief
Executive Officer of Savannah Electric and Power Company:
(1) Southern or the Company has entered into a written
agreement, such as, but not limited to, a letter of intent, which, if
Consummated, would result in a Southern Change in Control or a Savannah
Change in Control, as the case may be;
(2) Southern, the Company or any Person publicly announces an
intention to take or to consider taking actions which, if Consummated,
would result in a Southern Change of Control or a Savannah Change in
Control under circumstances where the Consummation of the announced
action or intended action is legally and financially possible;
(3) Any Person who achieves the Beneficial Ownership of
fifteen percent (15%) or more of the common stock of Southern; or
(4) The Southern Board or the Savannah Board has declared that
a Preliminary Change of Control has occurred.
2.14 "Savannah Board" shall mean the board of directors of the Company.
2.15 "Savannah Change in Control" shall mean the following:
(a) The Consummation of an acquisition by any Person of
Beneficial Ownership of 50% or more of the combined voting power of the
then outstanding Voting Securities of the Company; provided, however,
that for purposes of this Subsection 2.15, any acquisition by an
employee of Southern or its subsidiary or affiliate, or Group composed
entirely of such employees, any qualified pension plan, publicly held
mutual fund or any employee benefit plan (or related trust) sponsored
or maintained by Southern or any corporation Controlled by Southern
shall not constitute a Change in Control;
(b) Consummation of a reorganization, merger or consolidation
of the Company (a "Savannah Business Combination"), in each case,
unless, following such Savannah Business Combination, Southern Controls
the corporation surviving or resulting from such Savannah Business
Combination, or
(c) Consummation of the sale or other disposition of all or
substantially all of the assets of the Company to an entity which
Southern does not Control.
Notwithstanding the foregoing, in no event shall "Savannah Change in Control"
mean an initial public offering or a spin-off of the Company.
2.16 "Southern" shall mean The Southern Company, its successors and
assigns.
2.17 "Southern Board" shall mean the board of directors of Southern.
2.18 "Southern Change in Control" shall mean any of the following:
(a) The Consummation of an acquisition by any Person of
Beneficial Ownership of 20% or more of Southern's Voting Securities;
provided, however, that for purposes of this subsection (a), the
following acquisitions of Southern's Voting Securities shall not
constitute a Change in Control:
(i) any acquisition directly from Southern;
(ii) any acquisition by Southern;
(iii) any acquisition by any employee benefit plan
(or related trust) sponsored or maintained by Southern or any
corporation controlled by Southern;
(iv) any acquisition by a qualified pension plan or
publicly held mutual fund;
(v) any acquisition by an employee of Southern or its
subsidiary or affiliate, or Group composed exclusively of such
employees; or
(vi) any Business Combination which would not
otherwise constitute a Change in Control because of the
application of clauses (i), (ii) and (iii) of this Section;
(b) A change in the composition of the Southern Board whereby
individuals who constitute the Incumbent Board cease for any reason to
constitute at least a majority of the Southern Board; or
(c) Consummation of a Business Combination, unless, following
such Business Combination, all of the following three conditions are
met:
(i) all or substantially all of the individuals and
entities who held Beneficial Ownership, respectively, of
Southern's Voting Securities immediately prior to such
Business Combination beneficially own, directly or indirectly,
65% or more of the combined voting power of the Voting
Securities of the corporation surviving or resulting from such
Business Combination, (including, without limitation, a
corporation which as a result of such transaction holds
Beneficial Ownership of all or substantially all of Southern's
Voting Securities or all or substantially all of Southern's
assets) (such surviving or resulting corporation to be
referred to as "Surviving Company"), in substantially the same
proportions as their ownership, immediately prior to such
Business Combination, of Southern's Voting Securities;
(ii) no Person (excluding any corporation resulting
from such Business Combination, any qualified pension plan,
publicly held mutual fund, Group composed exclusively of
employees of Southern or its subsidiary or affiliate, or
employee benefit plan (or related trust) of Southern, its
subsidiaries or Surviving Company) holds Beneficial Ownership,
directly or indirectly, of 20% or more of the combined voting
power of the then outstanding Voting Securities of Surviving
Company except to the extent that such ownership existed prior
to the Business Combination; and
(iii) at least a majority of the members of the board
of directors of Surviving Company were members of the
Incumbent Board at the earlier of the date of execution of the
initial agreement, or of the action of the Southern Board,
providing for such Business Combination.
2.19 "Southern Committee" shall mean the committee comprised of the
Chairman of the Southern Board, Chief Financial Officer of Southern, General
Counsel of Southern and the Chairman of the Administrative Committee.
2.20 "Southern Termination" shall mean the following:
(a) The Consummation of a reorganization, merger or
consolidation of Southern under circumstances where either (i) Southern
is not the surviving corporation or (ii) Southern's Voting Securities
are no longer publicly traded;
(b) The Consummation of a sale or other disposition of all or
substantially all of Southern's assets; or
(c) The Consummation of an acquisition by any Person of
Beneficial Ownership of all of Southern's Voting Securities such that
Southern's Voting Securities are no longer publicly traded.
2.21 "Savannah Employee" shall mean an employee of the Company after a
Savannah Change in Control has occurred whose employment is not immediately
transferred to another subsidiary or affiliate of Southern upon such Savannah
Change in Control.
2.22 "Trust" shall mean the Southern Company Deferred Compensation
Trust.
2.23 "Voting Securities" shall mean the outstanding voting securities
of a corporation entitling the holder thereof to vote generally in the election
of such corporation's directors.
ARTICLE III - POOLING ACCOUNTING
Notwithstanding anything to the contrary herein, if, but for any
provision of this Policy, a Change in Control transaction would otherwise be
accounted for as a pooling-of-interests under APB No.16 ("Pooling Accounting")
(after giving effect to any and all other facts and circumstances affecting
whether such Change in Control transaction would use Pooling Accounting), such
provision or provisions of this Policy which would otherwise cause the Change in
Control transaction to be ineligible for Pooling Accounting shall automatically
be void and ineffective in such a manner and to the extent that by eliminating
such provision or provisions of this Policy, Pooling Accounting would be
required for such Change in Control transaction and Pooling Accounting is in
fact used for such Change in Control transaction.
ARTICLE IV - DEFERRED COMPENSATION PLAN FOR KEY EMPLOYEES
CHANGE IN CONTROL AND OTHER SPECIAL PROVISIONS
4.1 Application. The provisions of this Article IV apply to benefits
payable under the Deferred Compensation Plan for Key Employees of Savannah
Electric and Power Company (the "DCP"), notwithstanding any provision in the DCP
to the contrary. The meaning of capitalized terms not defined herein are
determined under the DCP.
4.2 Notwithstanding any other terms of the DCP to the contrary,
following a Southern Change in Control or a Savannah Change in Control, the
provisions of this Article IV shall apply to the payment of benefits under the
DCP with respect to any Savannah Employee who is a Participant on such date.
4.3 The Trust has been established to hold assets of the Company under
certain circumstances as a reserve for the discharge of the Company's
obligations under the DCP. In the event of a Preliminary Change in Control of
Southern or the Company, the Company shall be obligated to immediately
contribute such amounts to the Trust as may be necessary to fully fund all
benefits payable under the DCP in accordance with the procedures set forth in
Section 4.4 hereof. In addition, in order to provide the added protections for
certain individuals in accordance with Paragraph 7(b) of the Trust, the Company
may fund the Trust prior to a Preliminary Change in Control of Southern or the
Company in accordance with the terms of the Trust. All assets held in the Trust
remain subject only to the claims of the Company's general creditors whose
claims against the Company are not satisfied because of the Company's bankruptcy
or insolvency (as those terms are defined in the Trust). No Participant has any
preferred claim on, or beneficial ownership interest in, any assets of the Trust
before the assets are paid to the Participant and all rights created under the
Trust, as under the DCP, are unsecured contractual claims of the Participant
against the Company.
4.4 As soon as practicable following either a Preliminary Change in
Control of Southern or of the Company, the Company shall contribute an amount
based upon the funding strategy adopted by the Committee with the assistance of
an appointed actuary necessary to fulfill the Company's obligations pursuant to
this Article IV. In the event of a dispute over such actuary's determination,
the Company and any complaining Participant(s) shall refer such dispute to an
independent, third-party actuarial consultant, chosen by the Company and such
Participant. If the Company and the Participant cannot agree on an independent,
third-party actuarial consultant, the actuarial consultant shall be chosen by
lot from an equal number of actuaries submitted by the Company and the trustee
of the Trust. Any such referral shall only occur once in total and the
determination by the third-party actuarial consultant shall be final and binding
upon both parties. The Company shall be responsible for all of the fees and
expenses of the independent actuarial consultant.
4.5 In the event of a Southern Change in Control or a Savannah Change
in Control, notwithstanding anything to the contrary in the DCP, upon
termination or retirement from employment, the Account of a Participant who was
an Employee of the Company affected by such a Change in Control shall be paid
out in a lump sum if such Participant makes an election pursuant to procedures
established by the Administrative Committee in its sole and absolute discretion.
If no such election is made, the Participant shall receive payment of his
Account solely in accordance with the terms of the DCP.
ARTICLE V - DEFERRED COMPENSATION PLAN FOR DIRECTORS
CHANGE IN CONTROL AND OTHER SPECIAL PROVISIONS
5.1 Application. The provisions of this Article IV apply to benefits
payable under the Deferred Compensation Plan for Directors of Savannah Electric
and Power Company (the "DCP for Directors"), notwithstanding any provision in
the DCP for Directors to the contrary. The meaning of capitalized terms not
defined herein are determined under the DCP for Directors.
5.2 Notwithstanding any other terms of the DCP for Directors to the
contrary, following a Southern Change in Control or a Savannah Change in
Control, the provisions of this Article V shall apply to the payment of benefits
under the DCP for Directors with respect to any member of the Savannah Board who
is a Participant on such date.
5.3 The Trust has been established to hold assets of the Company under
certain circumstances as a reserve for the discharge of the Company's
obligations under the DCP for Directors. In the event of a Preliminary Change in
Control of Southern or the Company, the Company shall be obligated to
immediately contribute such amounts to the Trust as may be necessary to fully
fund all benefits payable under the DCP for Directors in accordance with the
procedures set forth in Section 5.4 hereof. In addition, in order to provide the
added protections for certain individuals in accordance with Paragraph 7(b) of
the Trust, the Company may fund the Trust prior to a Preliminary Change in
Control of Southern or the Company in accordance with the terms of the Trust.
All assets held in the Trust remain subject only to the claims of the Company's
general creditors whose claims against the Company are not satisfied because of
the Company's bankruptcy or insolvency (as those terms are defined in the
Trust). No Participant has any preferred claim on, or beneficial ownership
interest in, any assets of the Trust before the assets are paid to the
Participant and all rights created under the Trust, as under the DCP for
Directors, are unsecured contractual claims of the Participant against the
Company.
5.4 As soon as practicable following either a Preliminary Change in
Control of Southern or of the Company, the Company shall contribute an amount
based upon the funding strategy adopted by the Committee with the assistance of
an appointed actuary necessary to fulfill the Company's obligations pursuant to
this Article V. In the event of a dispute over such actuary's determination, the
Company and any complaining Participant(s) shall refer such dispute to an
independent, third-party actuarial consultant, chosen by the Company and such
Participant. If the Company and the Participant cannot agree on an independent,
third-party actuarial consultant, the actuarial consultant shall be chosen by
lot from an equal number of actuaries submitted by the Company and the Trustee.
Any such referral shall only occur once in total and the determination by the
third-party actuarial consultant shall be final and binding upon both parties.
The Company shall be responsible for all of the fees and expenses of the
independent actuarial consultant.
5.5 In the event of a Southern Change in Control or a Savannah Change
in Control, notwithstanding anything to the contrary in the DCP for Directors,
upon termination from being a director, the Account of a Participant shall be
paid out in a lump sum if such Participant makes an election pursuant to
procedures established by the Committee in its sole and absolute discretion. If
no such election is made, the Participant shall receive payment of his Account
solely in accordance with the provisions of the DCP for Directors.
ARTICLE VI - SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
CHANGE IN CONTROL AND OTHER SPECIAL PROVISIONS
6.1 Application. The provisions of this Article VI apply to benefits
payable under the Supplemental Executive Retirement Plan of Savannah Electric
and Power Company (the "SERP"), notwithstanding any provision in the SERP to the
contrary. The meaning of capitalized terms not defined herein are determined
under the SERP.
6.2 General. Notwithstanding any other terms of the SERP to the
contrary, upon a Southern Change in Control or a Subsidiary Change in Control,
the provisions of this Article VI shall become operative and apply to the
calculation and payment of benefits under the SERP with respect to any Savannah
Employee who is a Participant on such date.
6.3 Funding of Trust. The Trust has been established to hold assets of
the Company under certain circumstances as a reserve for the discharge of the
Company's obligations under the SERP. In the event of a Preliminary Change in
Control of Southern or the Company, the Company shall be obligated to
immediately contribute such amounts to the Trust as may be necessary to fully
fund all benefits payable under the SERP, as determined under Section 6.5
hereof, in accordance with the procedures set forth in Section 6.4 hereof. In
addition, in order to provide the added protections for certain individuals in
accordance with Paragraph 7(b) of the Trust, the Employing Companies may fund
the Trust prior to a Preliminary Change in Control of Southern or the Company.
All assets held in the Trust remain subject only to the claims of the Company's
general creditors whose claims against the Company are not satisfied because of
the Company's bankruptcy or insolvency (as those terms are defined in the
Trust). No Participant has any preferred claim on, or beneficial ownership
interest in, any assets of the Trust before the assets are paid to the
Participant and all rights created under the Trust, as under the SERP, are
unsecured contractual claims of the Participant against the Company.
6.4 Calculation of Trust Contribution. As soon as practicable following
either a Preliminary Change in Control of Southern or of the Company, the
Company shall contribute an amount based upon the funding strategy adopted by
the Administrative Committee with the assistance of an appointed actuary
necessary to fulfill the Company's obligations pursuant to this Article VI. In
the event of a dispute after a Change in Control over such actuary's
determination, the Company and any complaining Participant(s) shall refer such
dispute to an independent, third-party actuarial consultant, chosen by the
Company and such Participant. If the Company and the Participant cannot agree on
an independent, third-party actuarial consultant, the actuarial consultant shall
be chosen by lot from an equal number of actuaries submitted by the Company and
the trustee of the Trust. Any such referral shall only occur once in total and
the determination by the third-party actuarial consultant shall be final and
binding upon both parties. The Company shall be responsible for all of the fees
and expenses of the independent actuarial consultant.
6.5 SERP Benefit Upon Change in Control. On the date of a Southern
Change in Control or a Savannah Change in Control, the Accrued SERP Retirement
Benefit of each Participant who has a non-forfeitable right to Retirement Income
under the Southern Pension Plan, will be calculated based on such Participant's
Final Average Salary and Credited Service on such date determined without regard
to the vesting requirement provided under Article VII of the SERP, regardless of
whether such Participant is retirement eligible on such date. Each such
Participant will be entitled to receive the amount of his Accrued SERP
Retirement Benefit based on such Participant's Final Average Salary and Credited
Service as of the date of a Change in Control adjusted to take into account
appropriate early reduction factors, if any, based on the Participant's
commencement of benefits and the application of Section 4.6 of the SERP, if
applicable. Such benefit shall be paid in lump sum, upon termination of
employment or retirement. Any benefits accrued under the SERP subsequent to the
date of a Change in Control will be calculated and distributed pursuant to the
terms of the SERP, without regard to this Article VI.
ARTICLE VII - ADMINISTRATION
7.1 Administrative Committee. This Policy is administered by the
committee designated by the Company. Notwithstanding, the committee designated
as administrator of each of the Employee Benefit Plans shall be responsible for
the administration of this Policy as it relates to such committee's respective
responsibilities with respect to any Employee Benefit Plan.
ARTICLE VIII - MISCELLANEOUS
8.1 Amendment and Termination. This Policy may be amended or terminated
at any time by the board of directors of the Company (or its successors and
assigns, if applicable), provided, however, the Policy may not be amended in any
material respect or terminated within the two (2) year period following a Change
in Control nor shall any amendment or termination impair the rights of any
Participant in the Employee Benefit Plans which have accrued hereunder prior to
any such amendment or termination. In addition, any amendment to Articles I, II,
III, VII and VIII must be approved by the Southern Board.
8.2 Additional Rights. Nothing in the Policy shall interfere with or
limit in any way the right of the Company or Southern to terminate any
employee's employment at any time, or confer upon any employee any right to
continue in the employ of such companies.
IN WITNESS WHEREOF, this Savannah Electric and Power Company Change in
Control Benefit Plans Policy has been executed by duly authorized officers of
Savannah Electric and Power Company pursuant to resolutions of the Board of
Directors of Savannah Electric and Power Company this 16th day of November,
2000.
SAVANNAH ELECTRIC AND POWER COMPANY
By: /s/ K. R. Willis
ATTEST: /s/ Nancy E. Frankenhauser