Exhibit 4.11-A
PREFERRED SECURITIES GUARANTEE AGREEMENT
Between
The Southern Company
(as Guarantor)
and
Bankers Trust Company
(as Trustee)
dated as of
________ 1, ____
CROSS-REFERENCE TABLE1
Section of Section of
Trust Indenture Act Guarantee
of 1939, as amended Agreement
310(a)........................................4.01(a)
310(b)..................................4.01(c), 2.08
310(c)...................................Inapplicable
311(a)........................................2.02(b)
311(b)........................................2.02(b)
311(c)...................................Inapplicable
312(a)........................................2.02(a)
312(b)........................................2.02(b)
313..............................................2.03
314(a)...........................................2.04
314(b)...................................Inapplicable
314(c)...........................................2.05
314(d)...................................Inapplicable
314(e)...............................1.01, 2.05, 3.02
314(f).....................................2.01, 3.02
315(a)........................................3.01(d)
315(b)...........................................2.07
315(c)...........................................3.01
315(d)........................................3.01(d)
315(e)...................................Inapplicable
316(a)..................................5.04(i), 2.06
316(b)...........................................5.03
316(c)...........................................2.02
317(a)...................................Inapplicable
317(b)...................................Inapplicable
318(a)........................................2.01(b)
318(b)...........................................2.01
318(c)........................................2.01(a)
1This Cross-Reference Table does not constitute part of the Guarantee
Agreement and shall not affect the interpretation of any of its terms or
provisions.
TABLE OF CONTENTS
Page
ARTICLE I....................................................1
SECTION 1.01. Definitions...........................1
ARTICLE II...................................................3
SECTION 2.01. Trust Indenture Act;
Application................................3
SECTION 2.02. Lists of Holders of
Securities.................................3
SECTION 2.03. Reports by the Trustee................4
SECTION 2.04. Periodic Reports to Trustee...........4
SECTION 2.05. Evidence of Compliance with
Conditions Precedent.......................4
SECTION 2.06. Events of Default; Waiver.............4
SECTION 2.07. Event of Default; Notice..............4
SECTION 2.08. Conflicting Interests.................4
ARTICLE III..................................................5
SECTION 3.01. Powers and Duties of the
Trustee....................................5
SECTION 3.02. Certain Rights of Trustee.............6
SECTION 3.03. Compensation; Fees; Indemnity.........7
ARTICLE IV...................................................8
SECTION 4.01. Trustee; Eligibility..................8
SECTION 4.02. Appointment, Removal and
Resignation of Trustee.....................8
ARTICLE V....................................................9
SECTION 5.01. Guarantee.............................9
SECTION 5.02. Waiver of Notice and Demand...........9
SECTION 5.03. Obligations Not Affected..............9
SECTION 5.04. Rights of Holders....................10
SECTION 5.05. Guarantee of Payment.................10
SECTION 5.06. Subrogation..........................11
SECTION 5.07. Independent Obligations..............11
ARTICLE VI..................................................11
SECTION 6.01. Subordination........................11
ARTICLE VII.................................................11
SECTION 7.01. Termination..........................11
ARTICLE VIII................................................12
SECTION 8.01. Successors and Assigns...............12
SECTION 8.02. Amendments...........................12
SECTION 8.03. Notices..............................12
SECTION 8.04. Benefit..............................13
SECTION 8.05. Interpretation.......................13
SECTION 8.06. Governing Law........................13
PREFERRED SECURITIES GUARANTEE AGREEMENT
This PREFERRED SECURITIES GUARANTEE AGREEMENT ("Guarantee Agreement"),
dated as of ________ 1, ____, between THE SOUTHERN COMPANY, a Delaware
corporation (the "Guarantor"), and BANKERS TRUST COMPANY, a New York banking
corporation, as trustee (the "Trustee"), for the benefit of the Holders (as
defined herein) from time to time of the Preferred Securities (as defined
herein) of SOUTHERN COMPANY CAPITAL TRUST V, a Delaware statutory business trust
(the "Trust").
WHEREAS, pursuant to an Amended and Restated Trust Agreement (the
"Trust Agreement"), dated as of _______ 1, ____, among the Trustee, the other
Trustees named therein, Southern Company Capital Funding, Inc., a Delaware
corporation (the "Company"), as Depositor, and the holders of undivided
beneficial interests in the assets of the Trust, the Trust is issuing as of
______________ $____________ aggregate liquidation amount of its ______% Trust
Preferred Securities (the "Preferred Securities") representing preferred
undivided beneficial interests in the assets of the Trust and having the terms
set forth in the Trust Agreement;
WHEREAS, the Preferred Securities will be issued by the Trust and the
proceeds thereof will be used to purchase the Junior Subordinated Notes (as
defined in the Trust Agreement) of the Company, which will be held by the Trust
as trust assets; and
WHEREAS, as incentive for the Holders to purchase the Preferred
Securities, the Guarantor desires to irrevocably and unconditionally agree, to
the extent set forth herein, to pay to the Holders the Guarantee Payments (as
defined herein) and to make certain other payments on the terms and conditions
set forth herein.
NOW, THEREFORE, in consideration of the payment for Preferred
Securities by each Holder (as defined herein) thereof, which payment the
Guarantor hereby agrees shall benefit the Guarantor, the Guarantor executes and
delivers this Guarantee Agreement for the benefit of the Holders from time to
time of the Preferred Securities.
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. As used in this Guarantee Agreement, the
terms set forth below shall, unless the context otherwise requires, have the
following meanings. Capitalized or otherwise defined terms used but not
otherwise defined herein shall have the meanings assigned to such terms in the
Trust Agreement as in effect on the date hereof.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Common Securities" means the securities representing common undivided
beneficial interests in the assets of the Trust.
"Event of Default" means a failure by the Guarantor to perform any of
its payment obligations under this Guarantee Agreement.
"Guarantee Payments" shall mean the following payments or
distributions, without duplication, with respect to the Preferred Securities, to
the extent not paid or made by or on behalf of the Trust: (i) any accrued and
unpaid distributions that are required to be paid on such Preferred Securities
but if and only if and to the extent the Trust has funds legally and immediately
available therefor to make such payment; (ii) the redemption price, including
all accrued and unpaid distributions to the date of redemption (the "Redemption
Price"), with respect to the Preferred Securities called for redemption by the
Trust but if and only if and to the extent that the Trust has funds legally and
immediately available therefor sufficient to make such payment; and (iii) upon a
voluntary or involuntary dissolution, winding-up or termination of the Trust
(other than in connection with the distribution of Junior Subordinated Notes to
the holders of Trust Securities or the redemption of all of the Preferred
Securities), the lesser of (a) the aggregate of the liquidation amount and all
accrued and unpaid distributions on the Preferred Securities to the date of
payment, to the extent the Trust has funds legally and immediately available
therefor, and (b) the amount of assets of the Trust remaining available for
distribution to Holders in liquidation of the Trust (in either case, the
"Liquidation Distribution").
"Holder" shall mean any holder, as registered on the books and records
of the Trust, of any Preferred Securities; provided, however, that in
determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guarantor, the Company or any Affiliate of the Guarantor
or the Company.
"Indenture" means the Subordinated Note Indenture dated as of June 1,
1997, among the Company, as Subordinated Note Issuer, the Guarantor, as
guarantor, and Bankers Trust Company, as trustee, as heretofore supplemented and
as supplemented by the ________ Supplemental Indenture dated as of
______________, by and among the Company, the Guarantor and Bankers Trust
Company, as trustee.
"Majority in liquidation amount of Preferred Securities" means a vote
by Holder(s) of Preferred Securities, voting separately as a class, of more than
50% of the liquidation amount of all Preferred Securities outstanding at the
time of determination.
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, the President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary, of the Guarantor, and
delivered to the Trustee. Any Officers' Certificate delivered with respect to
compliance with a condition or covenant provided for in this Guarantee Agreement
shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering
the Officers' Certificate;
(c) a statement that each such officer has made such
examination or investigation as, in such officer's opinion, is
necessary to enable such officer to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Responsible Officer" means, with respect to the Trustee, any managing
director, any vice president, any assistant vice president, any assistant
secretary, any assistant treasurer, or any other officer of the Corporate Trust
and Agency Group of the Trustee customarily performing functions similar to
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of that officer's knowledge of and familiarity with
the particular subject.
"Successor Trustee" means a successor Trustee possessing the
qualifications to act as Trustee under Section 4.01.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
"Trustee" means Bankers Trust Company until a Successor Trustee has
been appointed and has accepted such appointment pursuant to the terms of this
Guarantee Agreement and thereafter means each such Successor Trustee.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.01. Trust Indenture Act; Application.
(a) This Guarantee Agreement is subject to the provisions of
the Trust Indenture Act that are required to be part of this Guarantee
Agreement and shall, to the extent applicable, be governed by such
provisions; and
(b) If and to the extent that any provision of this Guarantee
Agreement limits, qualifies or conflicts with the duties imposed by
Sections 310 to 317, inclusive, of the Trust Indenture Act, such
imposed duties shall control.
SECTION 2.02. Lists of Holders of Securities.
(a) The Guarantor shall furnish or cause to be furnished to
the Trustee (a) semiannually, not later than June 1 and December 1 in
each year, a list, in such form as the Trustee may reasonably require,
of the names and addresses of the Holders ("List of Holders") as of a
date not more than 15 days prior to the time such list is furnished,
and (b) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Guarantor of any such request,
a List of Holders as of a date not more than 15 days prior to the time
such list is furnished; provided that, the Guarantor shall not be
obligated to provide such List of Holders at any time the List of
Holders does not differ from the most recent List of Holders given to
the Trustee by the Guarantor or at any time the Trustee is the
Securities Registrar under the Trust Agreement. The Trustee may destroy
any List of Holders previously given to it on receipt of a new List of
Holders.
(b) The Trustee shall comply with its obligations under
Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.03. Reports by the Trustee. Within 60 days after May 15 of
each year commencing May 15, ____, the Trustee shall provide to the Holders of
the Preferred Securities such reports as are required by Section 313(a) of the
Trust Indenture Act, if any, in the form and in the manner provided by Section
313 of the Trust Indenture Act. The Trustee shall also comply with the other
requirements of Section 313 of the Trust Indenture Act.
SECTION 2.04. Periodic Reports to Trustee. The Guarantor shall provide
to the Trustee such documents, reports and information as required by Section
314 of the Trust Indenture Act (if any) in the form, in the manner and at the
times required by Section 314 of the Trust Indenture Act, and shall provide,
within 120 days after the end of each of its fiscal years, the compliance
certificate required by Section 314(a)(4) of the Trust Indenture Act in the form
and in the manner required by such Section.
SECTION 2.05. Evidence of Compliance with Conditions Precedent. The
Guarantor shall provide to the Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this Guarantee Agreement that
relate to any of the matters set forth in Section 314(c) of the Trust Indenture
Act. Any certificate or opinion required to be given by an officer pursuant to
Section 314(c)(1) may be given in the form of an Officers' Certificate.
SECTION 2.06. Events of Default; Waiver. The Holders of a Majority in
liquidation amount of Preferred Securities may, by vote, on behalf of all of the
Holders, waive any past Event of Default and its consequences. Upon such waiver,
any such Event of Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured, for every purpose of this
Guarantee Agreement, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.
SECTION 2.07. Event of Default; Notice.
(a) The Trustee shall, within 90 days after the occurrence of
an Event of Default, transmit by mail, first class postage prepaid, to
the Holders, notices of all Events of Default known to the Trustee,
unless such defaults have been cured before the giving of such notice,
provided that the Trustee shall be protected in withholding such notice
if and so long as the board of directors, the executive committee, or a
trust committee of directors and/or Responsible Officers of the Trustee
in good faith determines that the withholding of such notice is in the
interests of the Holders.
(b) The Trustee shall not be deemed to have knowledge of any
Event of Default unless the Trustee shall have received written notice,
or a Responsible Officer charged with the administration of the Trust
Agreement shall have obtained written notice, of such Event of Default.
SECTION 2.08. Conflicting Interests. The Trust Agreement shall be
deemed to be specifically described in this Guarantee Agreement for the purposes
of clause (i) of the first proviso contained in Section 310(b) of the Trust
Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF TRUSTEE
SECTION 3.01. Powers and Duties of the Trustee.
(a) This Guarantee Agreement shall be held by the Trustee for
the benefit of the Holders, and the Trustee shall not transfer this
Guarantee Agreement to any Person except the Trustee shall assign
rights hereunder to a Holder to the extent such assignment is necessary
to exercise such Holder's rights pursuant to Section 5.04 or to a
Successor Trustee upon acceptance by such Successor Trustee of its
appointment to act as Successor Trustee. The right, title and interest
of the Trustee shall automatically vest in any Successor Trustee, and
such vesting and cessation of title shall be effective whether or not
conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor Trustee.
(b) If an Event of Default has occurred and is continuing, the
Trustee shall enforce this Guarantee Agreement for the benefit of the
Holders.
(c) The Trustee, before the occurrence of any Event of Default
and after the curing or waiving of all Events of Default that may have
occurred, shall undertake to perform only such duties as are
specifically set forth in this Guarantee Agreement, and no implied
covenants shall be read into this Guarantee Agreement against the
Trustee. In case an Event of Default has occurred (that has not been
cured or waived pursuant to Section 2.06), the Trustee shall exercise
such of the rights and powers vested in it by this Guarantee Agreement,
and use the same degree of care and skill in its exercise thereof, as a
prudent person would exercise or use under the circumstances in the
conduct of his or her own affairs.
(d) No provision of this Guarantee Agreement shall be
construed to relieve the Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) prior to the occurrence of any Event of Default
and after the curing or waiving of all such Events of Default
that may have occurred:
(A) the duties and obligations of the
Trustee shall be determined solely by the express
provisions of this Guarantee Agreement, and the
Trustee shall not be liable except for the
performance of such duties and obligations as are
specifically set forth in this Guarantee Agreement;
and
(B) in the absence of bad faith on the part
of the Trustee, the Trustee may conclusively rely, as
to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates
or opinions furnished to the Trustee and conforming
to the requirements of this Guarantee Agreement; but
in the case of any such certificates or opinions that
by any provision hereof are specifically required to
be furnished to the Trustee, the Trustee shall be
under a duty to examine the same to determine whether
or not they conform to the requirements of this
Guarantee Agreement;
(ii) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the
Trustee, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts upon which such
judgment was made;
(iii) the Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of a Majority in
liquidation amount of the Preferred Securities relating to the
time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or
power conferred upon the Trustee under this Guarantee
Agreement; and
(iv) no provision of this Guarantee Agreement shall
require the Trustee to expend or risk its own funds or
otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of
its rights or powers, if the Trustee shall have reasonable
grounds for believing that the repayment of such funds or
liability is not reasonably assured to it under the terms of
this Guarantee Agreement or adequate indemnity against such
risk or liability is not reasonably assured to it.
SECTION 3.02. Certain Rights of Trustee.
(a) Subject to the provisions of Section 3.01:
(i) the Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper
or document believed by it to be genuine and to have been
signed, sent or presented by the proper party or parties;
(ii) any direction or act of the Guarantor
contemplated by this Guarantee Agreement shall be sufficiently
evidenced by an Officers' Certificate;
(iii) whenever, in the administration of this
Guarantee Agreement, the Trustee shall deem it desirable that
a matter be proved or established before taking, suffering or
omitting any action hereunder, the Trustee (unless other
evidence is herein specifically prescribed) may, in the
absence of bad faith on its part, request and rely upon an
Officers' Certificate which, upon receipt of such request,
shall be promptly delivered by the Guarantor;
(iv) the Trustee may consult with counsel of its
choice, and the advice or opinion of such counsel with respect
to legal matters shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in accordance with such
advice or opinion; such counsel may be counsel to the
Guarantor or any of its Affiliates and may include any of its
employees; the Trustee shall have the right at any time to
seek instructions concerning the administration of this
Guarantee Agreement from any court of competent jurisdiction;
(v) the Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this
Guarantee Agreement at the request or direction of any Holder,
unless such Holder shall have provided to the Trustee
reasonable security and indemnity satisfactory to the Trustee
against the costs, expenses (including attorneys' fees and
expenses) and liabilities that might be incurred by it in
complying with such request or direction, including such
reasonable advances as may be requested by the Trustee;
provided that nothing contained in this Section 3.02(a)(v)
shall be taken to relieve the Trustee, upon the occurrence of
an Event of Default, of its obligation to exercise the rights
and powers vested in it by this Guarantee Agreement;
(vi) the Trustee shall not be bound to make any
investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper
or document, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as
it may see fit;
(vii) the Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either
directly or by or through agents or attorneys, and the Trustee
shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by
it hereunder; and
(viii) whenever in the administration of this
Guarantee Agreement the Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy or
right or taking any other action hereunder, the Trustee (i)
may request instructions from the Holders, (ii) may refrain
from enforcing such remedy or right or taking such other
action until such instructions are received, and (iii) shall
be protected in acting in accordance with such instructions.
(b) No provision of this Guarantee Agreement shall be deemed
to impose any duty or obligation on the Trustee to perform any act or
acts or exercise any right, power, duty or obligation conferred or
imposed on it in any jurisdiction in which it shall be illegal, or in
which the Trustee shall be unqualified or incompetent in accordance
with applicable law, to perform any such act or acts or to exercise any
such right, power, duty or obligation. No permissive power or authority
available to the Trustee shall be construed to be a duty.
SECTION 3.03. Compensation; Fees; Indemnity.
The Guarantor agrees:
(a) to pay to the Trustee from time to time reasonable
compensation for all services rendered by the Trustee hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(b) except as otherwise expressly provided herein, to
reimburse the Trustee upon request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Guarantee Agreement (including
the reasonable compensation and the expenses and disbursements of its
agents and counsel), except any such expense, disbursement or advance
as may be attributable to its negligence or bad faith; and
(c) to indemnify the Trustee for, and to hold the Trustee
harmless against, any and all loss, damage, claims, liability or
expense incurred without negligence or bad faith on its part, arising
out of or in connection with the acceptance or administration of this
Guarantee Agreement, including the costs and expenses of defending
itself against any claim or liability in connection with the exercise
or performance of any of its powers or duties hereunder.
The provisions of this Section 3.03 shall survive the termination of
this Guarantee Agreement.
ARTICLE IV
TRUSTEE
SECTION 4.01. Trustee; Eligibility.
(a) There shall at all times be a Trustee which shall:
(i) not be an Affiliate of the Guarantor or the
Company; and
(ii) be a corporation organized and doing business
under the laws of the United States of America or any State or
Territory thereof or of the District of Columbia, or a
corporation or Person permitted by the Securities and Exchange
Commission to act as an institutional trustee under the Trust
Indenture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus
of at least 50 million U.S. dollars ($50,000,000), and subject
to supervision or examination by Federal, State, Territorial
or District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant to
law or to the requirements of the supervising or examining
authority referred to above, then, for the purposes of this
Section 4.01(a)(ii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so
published.
(b) If at any time the Trustee shall cease to be eligible to
so act under Section 4.01(a), the Trustee shall immediately resign in
the manner and with the effect set out in Section 4.02(c).
(c) If the Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture
Act, the Trustee and Guarantor shall in all respects comply with the
provisions of Section 310(b) of the Trust Indenture Act, subject to the
rights of the Trustee under the penultimate paragraph thereof.
SECTION 4.02. Appointment, Removal and Resignation of Trustee.
(a) Subject to Section 4.02(b), the Trustee may be appointed
or removed without cause at any time by the Guarantor.
(b) The Trustee shall not be removed until a Successor Trustee
has been appointed and has accepted such appointment by written
instrument executed by such Successor Trustee and delivered to the
Guarantor.
(c) The Trustee appointed to office shall hold office until a
Successor Trustee shall have been appointed or until its removal or
resignation. The Trustee may resign from office (without need for prior
or subsequent accounting) by an instrument in writing executed by the
Trustee and delivered to the Guarantor, which resignation shall not
take effect until a Successor Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such
Successor Trustee and delivered to the Guarantor and the resigning
Trustee.
(d) If no Successor Trustee shall have been appointed and
accepted appointment as provided in this Section 4.02 within 60 days
after delivery to the Guarantor of an instrument of resignation, the
resigning Trustee may petition any court of competent jurisdiction for
appointment of a Successor Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a
Successor Trustee.
ARTICLE V
GUARANTEE
SECTION 5.01. Guarantee. The Guarantor irrevocably and unconditionally
agrees to pay in full to the Holders the Guarantee Payments (without duplication
of amounts theretofore paid by or on behalf of the Trust), as and when due,
regardless of any defense, right of set-off or counterclaim which the Guarantor
may have or assert against any Person. The Guarantor's obligation to make a
Guarantee Payment may be satisfied by direct payment of the required amounts by
the Guarantor to the Holders or by causing the Trust to pay such amounts to the
Holders.
SECTION 5.02. Waiver of Notice and Demand. The Guarantor hereby waives
notice of acceptance of this Guarantee Agreement and of any liability to which
it applies or may apply, presentment, demand for payment, any right to require a
proceeding first against the Trust or any other Person before proceeding against
the Guarantor, protest, notice of nonpayment, notice of dishonor, notice of
redemption and all other notices and demands.
SECTION 5.03. Obligations Not Affected. The obligation of the Guarantor
to make the Guarantee Payments under this Guarantee Agreement shall in no way be
affected or impaired by reason of the happening from time to time of any of the
following:
(a) the release or waiver, by operation of law or otherwise,
of the performance or observance by the Trust of any express or implied
agreement, covenant, term or condition relating to the Preferred
Securities to be performed or observed by the Trust;
(b) the extension of time for the payment by the Trust of all
or any portion of the Distributions, Redemption Price, Liquidation
Distribution or any other sums payable under the terms of the Preferred
Securities or the extension of time for the performance of any other
obligation under, arising out of, or in connection with, the Preferred
Securities (other than an extension of time for payment of
Distributions, Redemption Price, Liquidation Distribution or other sum
payable that results from the extension of any interest payment period
on the Junior Subordinated Notes permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence on the
part of the Holders to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Holders pursuant to the
terms of the Preferred Securities, or any action on the part of the
Trust granting indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy,
assignment for the benefit of creditors, reorganization, arrangement,
composition or readjustment of debt of, or other similar proceedings
affecting, the Trust or any of the assets of the Trust;
(e) any invalidity of, or defect or deficiency in, the
Preferred Securities;
(f) the settlement or compromise of any obligation guaranteed
hereby or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor, it
being the intent of this Section 5.03 that the obligations of the
Guarantor hereunder shall be absolute and unconditional under any and
all circumstances.
There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
SECTION 5.04. Rights of Holders. The Guarantor expressly acknowledges
that: (i) this Guarantee Agreement will be deposited with the Trustee to be held
for the benefit of the Holders; (ii) the Trustee has the right to enforce this
Guarantee Agreement on behalf of the Holders; (iii) the Holders of a Majority in
liquidation amount of the Preferred Securities have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee in respect of this Guarantee Agreement or exercising any trust or
power conferred upon the Trustee under this Guarantee Agreement, provided that
such direction shall not be in conflict with any rule of law or with this
Guarantee Agreement, and could not involve the Trustee in personal liability in
circumstances where reasonable indemnity would not be adequate; and (iv) any
Holder may institute a legal proceeding directly against the Guarantor to
enforce its rights under this Guarantee Agreement, without first instituting a
legal proceeding against or requesting or directing that action be taken by the
Trustee or any other Person; it being understood and intended that no one or
more of such Holders shall have any right in any manner whatsoever by virtue of,
or by availing of, any provision of this Guarantee Agreement to affect, disturb
or prejudice the rights of any other of such Holders or to obtain or to seek to
obtain priority or preference over any other of such Holders or to enforce any
right under this Guarantee Agreement, except in the manner herein provided and
for the equal and ratable benefit of all of such Holders.
SECTION 5.05. Guarantee of Payment. This Guarantee Agreement creates a
guarantee of payment and not of collection. This Guarantee Agreement will not be
discharged except by payment of the Guarantee Payments in full (without
duplication) or upon the distribution of Junior Subordinated Notes to the
Holders in exchange for all of the Preferred Securities.
SECTION 5.06. Subrogation. The Guarantor shall be subrogated to all (if
any) rights of the Holders against the Trust in respect of any amounts paid to
the Holders by the Guarantor under this Guarantee Agreement; provided, however,
that the Guarantor shall not (except to the extent required by mandatory
provisions of law) be entitled to enforce or exercise any rights which it may
acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Guarantee Agreement,
if, at the time of any such payment, any amounts of Guarantee Payments are due
and unpaid under this Guarantee Agreement. If any amount shall be paid to the
Guarantor in violation of the preceding sentence, the Guarantor agrees to hold
such amount in trust for the Holders and to pay over such amount to the Holders.
SECTION 5.07. Independent Obligations. The Guarantor acknowledges that
its obligations hereunder are independent of the obligations of the Trust with
respect to the Preferred Securities and that the Guarantor shall be liable as
principal and as debtor hereunder to make Guarantee Payments pursuant to the
terms of this Guarantee Agreement notwithstanding the occurrence of any event
referred to in subsections (a) through (g), inclusive, of Section 5.03 hereof.
ARTICLE VI
SUBORDINATION
SECTION 6.01. Subordination. This Guarantee Agreement will constitute
an unsecured obligation of the Guarantor and will rank (i) subordinate and
junior in right of payment to all other liabilities of the Guarantor, including
the Junior Subordinated Notes, except those obligations or liabilities made pari
passu or subordinate by their terms, (ii) pari passu with the most senior
preferred or preference stock now or hereafter issued by the Guarantor and with
any guarantee now or hereafter entered into by the Guarantor in respect of any
preferred or preference securities of any Affiliate of the Guarantor, and (iii)
senior to all common stock of the Guarantor.
ARTICLE VII
TERMINATION
SECTION 7.01. Termination. This Guarantee Agreement shall terminate and
be of no further force and effect upon: (i) full payment of the Redemption Price
of all Preferred Securities, (ii) the distribution of Junior Subordinated Notes
to the Holders in exchange for all of the Preferred Securities, or (iii) full
payment of the amounts payable in accordance with the Trust Agreement upon
liquidation of the Trust. Notwithstanding the foregoing, this Guarantee
Agreement will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder must restore payment of any sums paid with respect
to Preferred Securities or under this Guarantee Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Successors and Assigns. All guarantees and agreements
contained in this Guarantee Agreement shall bind the successors, assigns,
receivers, trustees and representatives of the Guarantor and shall inure to the
benefit of the Holders of the Preferred Securities then outstanding. Except in
connection with a consolidation, merger, conveyance, transfer, or lease
involving the Guarantor that is permitted under Article Eight of the Indenture,
the Guarantor shall not assign its obligations hereunder.
SECTION 8.02. Amendments. Except with respect to any changes which do
not materially and adversely affect the rights of Holders (in which case no
consent of Holders will be required), this Guarantee Agreement may only be
amended with the prior approval of the Holders of not less than 66-2/3% in
liquidation amount of all the outstanding Preferred Securities. The provisions
of Article Six of the Trust Agreement concerning meetings of Holders shall apply
to the giving of such approval.
SECTION 8.03. Notices. Any notice, request or other communication
required or permitted to be given hereunder shall be in writing, duly signed by
the party giving such notice, and delivered, telecopied or mailed by first class
mail as follows:
(a) if given to the Guarantor, to the address set forth below
or such other address as the Guarantor may give notice of to the
Trustee and the Holders:
The Southern Company
270 Peachtree Street, N.W.
Atlanta, Georgia 30303
Facsimile No.: (404) 506-0808
Attn: Secretary
with copy to:
Southern Company Services, Inc.
270 Peachtree Street, N.W., Suite 2000
Atlanta, Georgia 30303
Facsimile No.: (404) 506-0674
Attention: Corporate Finance Department
(b) if given to the Trust, in care of the Trustee, or to the
Trustee at the Trust's (and the Trustee's) address set forth below or
such other address as the Trustee on behalf of the Trust may give
notice to the Holders:
Southern Company Capital Trust IV
c/o Bankers Trust Company
Four Albany Street
New York, New York 10006
Attn: Corporate Trust and Agency Group
Manager Public Utilities Group
with a copy, in the case of a notice to the Trust (other than
a notice from the Guarantor), to the Guarantor;
(c) if given to any Holder, at the address set forth on the
books and records of the Trust.
All notices hereunder shall be deemed to have been given when received
in person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 8.04. Benefit. This Guarantee Agreement is solely for the
benefit of the Holders and, subject to Section 3.01(a), is not separately
transferable from the Preferred Securities.
SECTION 8.05. Interpretation. In this Guarantee Agreement, unless the
context otherwise requires:
(a) capitalized terms used in this Guarantee Agreement but not
defined in the preamble hereto have the respective meanings assigned to
them in Section 1.01;
(b) a term defined anywhere in this Guarantee Agreement has
the same meaning throughout;
(c) all references to "the Guarantee Agreement" or "this
Guarantee Agreement" are to this Guarantee Agreement as modified,
supplemented or amended from time to time;
(d) all references in this Guarantee Agreement to Articles and
Sections are to Articles and Sections of this Guarantee Agreement
unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Guarantee Agreement unless otherwise defined
in this Guarantee Agreement or unless the context otherwise requires;
(f) a reference to the singular includes the plural and vice
versa; and
(g) the masculine, feminine or neuter genders used herein
shall include the masculine, feminine and neuter genders.
SECTION 8.06. Governing Law. THIS GUARANTEE AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
STATE OF NEW YORK. THE GUARANTOR HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION
OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND
ANY COURT IN THE STATE OF NEW YORK LOCATED IN THE CITY AND COUNTY OF NEW YORK IN
ANY ACTION, SUIT OR PROCEEDING BROUGHT AGAINST IT AND RELATED TO OR IN
CONNECTION WITH THIS GUARANTEE AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
THEREBY, AND TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE GUARANTOR HEREBY
WAIVES AND AGREES NOT TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE IN
ANY SUCH SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT
TO THE JURISDICTION OF SUCH COURTS, THAT THE SUIT, ACTION OR PROCEEDING IS
BROUGHT IN AN INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR
PROCEEDING IS IMPROPER, OR THAT THIS GUARANTEE AGREEMENT OR ANY DOCUMENT OR ANY
INSTRUMENT REFERRED TO HEREIN OR THE SUBJECT MATTER HEREOF MAY NOT BE LITIGATED
IN OR BY SUCH COURTS. THE GUARANTOR AGREES THAT SERVICE OF PROCESS MAY BE MADE
UPON IT BY CERTIFIED OR REGISTERED MAIL TO THE ADDRESS FOR NOTICES SET FORTH IN
THIS GUARANTEE AGREEMENT OR ANY METHOD AUTHORIZED BY THE LAWS OF NEW YORK.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
THIS GUARANTEE AGREEMENT is executed as of the day and year first above
written.
THE SOUTHERN COMPANY
By:
Name: W. L. Westbrook
Title: Financial Vice President
BANKERS TRUST COMPANY,
as Trustee
By:
Name:
Title: