-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, SgEGsBtRxYgeKvbOtvM2Buk8jlFBSwVmfETw03ls8da/uBY2ULBY4vIGV0dSAXn0 XEdR0UaNRIL0xrXaLeiytA== 0000092122-97-000018.txt : 19970401 0000092122-97-000018.hdr.sgml : 19970401 ACCESSION NUMBER: 0000092122-97-000018 CONFORMED SUBMISSION TYPE: U-1 PUBLIC DOCUMENT COUNT: 7 FILED AS OF DATE: 19970331 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: SOUTHERN CO CENTRAL INDEX KEY: 0000092122 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 580690070 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: U-1 SEC ACT: 1935 Act SEC FILE NUMBER: 070-09035 FILM NUMBER: 97571565 BUSINESS ADDRESS: STREET 1: 64 PERIMETER CENTER EAST CITY: ATLANTA STATE: GA ZIP: 30346 BUSINESS PHONE: 770-393-06 MAIL ADDRESS: STREET 1: 64 PERIMETER CENTER EAST CITY: ATLANTA STATE: GA ZIP: 30346 U-1 1 FORM U-1 File No. 70-__________ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM U-1 APPLICATION OR DECLARATION under The Public Utility Holding Company Act of 1935 THE SOUTHERN COMPANY 270 Peachtree Street, N.W. Atlanta, Georgia 30303 (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, Secretary The Southern Company 270 Peachtree Street, N.W. Atlanta, Georgia 30303 (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 LLP The Southern Company 600 Peachtree Street, N.E. 270 Peachtree Street, N.W. Suite 5200 Atlanta, Georgia 30303 Atlanta, Georgia 30308-2216 INFORMATION REQUIRED Item 1. Description of Proposed Transactions 1.1 The Southern Company ("Southern"), a registered holding company under the Public Utility Holding Company Act of 1935 (the "Act"), proposes, from time to time through February 17, 2007, to grant Incentive Stock Options, Nonqualified Stock Options, Stock Appreciation Rights and Restricted Stock, and to issue shares of its common stock, par value $5.00 per share ("Common Stock"), pursuant to the Southern Company Performance Stock Plan (the "Plan"), as described herein. The Board of Directors of Southern has adopted the Plan, subject to stockholder approval. The purpose of the Plan is to maximize the long-term success of Southern, to ensure a balanced emphasis on both current and long-term performance, to enhance Plan participants' identification with stockholders' interests, and to facilitate the attraction and retention of key individuals with outstanding ability. The Plan will be administered by the Compensation & Management Succession Committee of the Board of Directors of Southern (the "Committee"). The Committee consists of three or more directors of Southern who are not employees of Southern or its subsidiaries. The Committee will have exclusive authority to interpret the Plan. The Plan permits the Committee to grant not more frequently than once each calendar year, in its discretion, Incentive Stock Options and Nonqualified Stock Options (collectively, "Stock Options"), Stock Appreciation Rights, and/or Restricted Stock to directors of Southern or certain of its subsidiaries and those employees, as determined by the Committee, who have a significant impact on the long-term performance and success of Southern. The Committee has determined that the approximate number of Participants under the Plan initially will be 250, but may be changed at the Committee's discretion. Nonqualified Stock Options entitle the Participant to purchase up to the number of shares of Common Stock specified in the grant at a specified price (the "Option Price"). The Option Price will be set by the Committee at the time a grant is made. It cannot be less than the fair market value of the Common Stock on the date of the grant. Nonqualified Stock Options may not be exercised more than 10 years after the date granted. Stock Options designated by the Committee as Incentive Stock Options are intended to comply with Section 422 of the Internal Revenue Code. They will be granted only to employees and entitle the Participant to purchase the specified number of shares of Common Stock at the Option Price not more than 10 years from the date of the grant. The aggregate fair market value of Common Stock determined at the time of each grant for which any Participant may vest in Incentive Stock Options under the Plan for any calendar year shall not exceed $100,000. Stock Appreciation Rights are rights that, when exercised, entitle the Participant to the appreciation in value of the number of shares of Common Stock specified in the grant, from the date granted to the date exercised. The exercised Stock Appreciation Right may be paid in cash and/or Common Stock, as determined by the Committee. Stock Appreciation Rights may be granted in the sole discretion of the Committee in conjunction with an Incentive Stock Option or Nonqualified Stock Option. Stock Appreciation Rights may not be exercised more than 10 years after the date granted. Restricted Stock awards are grants of shares of Common Stock that are held by Southern for the benefit of the Participant without payment of consideration 2 by the Participant. There are restrictions or conditions on the Participant's right to transfer or sell such shares. The Committee will establish a "Restriction Period" of from one through 10 years for each Restricted Stock award made. The Participant will be entitled to dividends paid on the Restricted Stock and will have the right to vote such shares. Stock Options must be paid in full when exercised by the Participant. The Committee, in its discretion, may permit the Option Price to be paid in whole or in part through the transfer to Southern of shares of Common Stock previously acquired by the Participant. A total of 40,000,000 shares of Common Stock is available for grants by the Committee under the Plan. At this time, the Committee is expected initially to grant Nonqualified Stock Options only; however, the other types of awards provided for in the Plan may be granted in the future. Under the Plan, the maximum number of shares of Common Stock which may be the subject of any award to a Participant during any calendar year is 1,000,000 shares. The Board of Directors of Southern may terminate or amend the Plan at any time; provided, however, without stockholder approval, the Board of Directors may not increase the total number of shares of Common Stock available for grants under the Plan. The Plan will terminate February 17, 2007, unless terminated sooner by the Board of Directors. 1.2 Southern further proposes to submit the Plan for consideration and action by its stockholders at the annual meeting of such stockholders to be held on May 28, 1997, and in connection therewith, to solicit proxies from its stockholders. The material to be used in connection with such solicitation in respect of the Plan will be substantially as set forth in Exhibits G-1, G-2 and G-3 hereto. In addition, in the event that Southern considers it desirable 3 to do so, it may employ professional proxy solicitors to assist in the solicitation of proxies and pay their expenses and compensation for such assistance which, it is estimated, will not exceed $30,000. Approval of the Plan requires the affirmative vote of the holders of a majority of the shares of Common Stock represented in person or by proxy at the annual meeting. Item 2. Fees, Commissions and Expenses The estimated fees and expenses paid or incurred, or to be paid or incurred, directly or indirectly, in connection with the proposed transactions (including costs associated with the solicitation of proxies) are as follows: Printing..............................................$ 75,000 Postage and Mailing.....................................487,000 Services of Southern Company Services, Inc. (includes transfer agent and tabulation expenses)..............................................95,000 Legal Fees...............................................12,000 Miscellaneous......................................... 8,000 Total..................................................$677,000 Item 3. Applicable Statutory Provisions Sections 6(a), 7 and 12(e) of the Act and Rules 23, 24, 62 and 65 are applicable to the proposed transactions. Item 4. Regulatory Approval No state commission and no federal commission (other than the Securities and Exchange Commission) has jurisdiction over the proposed transactions. 4 Item 5. Procedure In order to give Southern sufficient time for the preparation and mailing of the proxy solicitation material to its stockholders prior to the annual meeting to be held on May 28, 1997, Southern hereby requests that the Commission issue an order as soon as practicable, pursuant to Rule 62(d) under the Act, permitting the solicitation of proxies proposed herein. Southern further hereby requests that the Commission issue its order with respect to the Plan on or before May 6, 1997. Southern hereby waives a recommended decision by a hearing officer or other responsible officer of the Commission, consents that the Division of Investment Management may assist in the preparation of the Commission's decision and/or order in this matter, unless such Division opposes the transactions proposed herein, and requests that there be no 30-day waiting period between the issuance of the Commission's order and the date on which it is to become effective. Southern hereby requests that it be permitted to file certificates of notification on a quarterly basis, within 45 days after the end of each calendar quarter.
Item 6. Exhibits and Financial Statements (a) Exhibits. A-1 - Draft of Southern Company Performance Stock Plan. A-2 - 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.) A-3 - By-Laws 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.) B - None. C - None. 5 D - None. E - None. F - Opinion of Troutman Sanders LLP. G-1 - Draft of notice of annual meeting of stockholders. G-2 - Draft of statement relating to the Plan to be included in the proxy statement for the annual meeting. G-3 - Draft of form of proxy for the annual meeting. H - Form of Notice and Order permitting the solicitation of proxies.
Exhibits heretofore filed with the Securities and Exchange Commission and designated as set forth above are hereby incorporated herein by reference and made a part hereof with the same effect as if filed herewith. (b) Financial Statements. Financial statements are omitted since they are not deemed relevant or necessary for a proper disposition of the proposed transactions by the Commission. Item 7. Information as to Environmental Effects (a) In light of the nature of the proposed transactions as described in Item 1 hereof, the Commission's action in this matter will not constitute any major federal action significantly affecting the quality of the human environment. (b) No other federal agency has prepared or is preparing an environmental impact statement with regard to the proposed transactions. 6 SIGNATURES Pursuant to the requirements of the Public Utility Holding Company Act of 1935, the undersigned company has duly caused this statement to be signed on its behalf by the undersigned thereunto duly authorized. Dated: March 31, 1997 THE SOUTHERN COMPANY By: /s/ Tommy Chisholm Tommy Chisholm Secretary 7 EX-99 2 EXHIBIT A-1 DRAFT March 28, 1997 SOUTHERN COMPANY PERFORMANCE STOCK PLAN EFFECTIVE FEBRUARY 18, 1997 TROUTMAN SANDERS LLP NationsBank Plaza 600 Peachtree Street, N.E., Suite 5200 Atlanta, Georgia 30308 (404) 885-3000 SOUTHERN COMPANY STOCK PLAN Purposes This Southern Company Performance Stock Plan is intended to maximize the long-term success of Southern Company, ensure a balanced emphasis on both current and long-term performance, enhance Participants' identification with shareholders' interests, and facilitate the attraction and retention of key individuals with outstanding ability. ARTICLE I 1.1 Definitions. Whenever used in the Plan, the following terms shall have the meaning set forth below: ----------- (a) "Award" shall mean, individually and collectively, any Option, Stock Appreciation Right, or Restricted Stock granted under the Plan. (b) "Award Document" shall mean the written document evidencing the grant of an Award and setting forth the terms and conditions thereof. (c) "Base Value" shall mean the Fair Market Value of a Stock Appreciation Right on the date of its grant. (d) "Board" or "Board of Directors" shall mean the Board of Directors of the Company. (e) "Code" shall mean the Internal Revenue Code of 1986, as amended. (f) "Committee" shall mean the Compensation Committee of the Board of Directors of the Company composed solely of not less than three (3) Nonemployee Directors and, to the extent necessary for any Award intended to qualify as performance based compensation under Section 162(m) of the Code to so qualify, each member of the Committee shall be an Outside Director. (g) "Common Stock" shall mean the Common Stock of the Company. (h) "Company" shall mean The Southern Company or any successor thereto. (i) "Covered Employee" shall mean a Participant who is as of the last day of the Company's fiscal year in which the Participant shall be required to recognize taxable income with respect to an Award, a "covered employee" within the meaning of Code section 162(m)(3) and the regulations thereunder. (j) "Director" shall mean any person who is currently a member of the Board of Directors of the Company or an Employing Company. (k) "Disability" shall mean total and permanent disability as determined by the Social Security Administration. (l) "Effective Date" shall mean the date the Plan is adopted by the Board of Directors of the Company, subject to approval by the shareholders of the Company at a meeting held within twelve (12) months following the date of adoption by the Board of Directors. (m) "Employee" shall mean any person who is currently employed by an Employing Company. (n) "Employing Company" shall mean any affiliate or subsidiary (direct or indirect) of the Company, which the Board of Directors may from time to time determine to bring under the Plan and which may adopt the Plan, and any successor of any of them. The Employing Companies as of January 1, 1997 are: Alabama Power Company Georgia Power Company Gulf Power Company Mississippi Power Company Savannah Electric and Power Company Southern Communications, Inc. Southern Company Services, Inc. Southern Energy, Inc. Southern Nuclear Operating Company Southern Development and Investment Group, Inc. (o) "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. (p) "Fair Market Value" shall mean the average of the high and low prices at which a share of Common Stock shall have been traded on the date of grant or the exercise of an Award, or on the next preceding trading day if such date was not a trading date, as reported on the New York Stock Exchange-Composite Transactions Listing, or as otherwise determined by the Committee. In no event shall the Fair Market Value equal less than the par value of the Common Stock. (q) "Incentive Stock Option" shall mean a stock option satisfying the requirements of Section 422 of the Code granted pursuant to Section 4.1(b) and designated by the Committee as an Incentive Stock Option. (r) "Nonemployee Director" shall mean a Director of the Company who is a "nonemployee director" within the meaning of Rule 16b-3 promulgated under the Exchange Act. (s) "Nonqualified Stock Option" shall mean an Option, other than an Incentive Stock Option, granted pursuant to Section 4.1(c). (t) "Option" shall mean, individually and collectively, an Incentive Stock Option or a Nonqualified Stock Option to purchase Common Stock. (u) "Optionee" shall mean a person to whom an Option has been granted under the Plan. (v) "Option Price" shall mean the price per share of Common Stock set by the grant of an Option, but in no event less than the Fair Market Value of the Common Stock on the date of grant. (w) "Outside Director" shall mean a Director of the Company who is an "outside director" within the meaning of Section 162(m) of the Code and the regulations promulgated thereunder. (x) "Participant" shall mean any Director or Employee who satisfies the criteria set forth in Article III. (y) "Performance-Based" shall mean compensation which qualifies as "performance-based" within the meaning of Code section 162(m)(4)(c) and the regulations thereunder. (z) "Restricted Stock" shall mean an Award granted pursuant to Section 4.1(e). (aa) "Retirement" shall mean the termination of service or employment by a Participant on or after age 65 or as otherwise determined by the Committee in its sole discretion. (bb) "Separation Date" shall mean, as determined by the Committee, the date on which a Participant's service or employment with the Company or Employing Company terminates for reasons other than his transfer of service or employment to the Company or another Employing Company. Whether any leave of absence shall constitute termination of service or employment for the purposes of the Plan shall be determined in each case by the Committee in its sole discretion. (cc) "Stock Appreciation Right" or "SAR" shall mean a right to any appreciation in value of shares of Common Stock granted pursuant to Section 4.1(d). 1.2 Construction. Where the context requires, words in the masculine gender shall include the feminine and neuter genders, words in the singular shall include the plural, and words in the plural shall include the singular. 1.3 Term. The Plan shall remain in effect for ten (10) years from the Effective Date or until terminated by the Board of Directors, whichever occurs first. ARTICLE II 2.1 Plan Administration. The Plan shall be administered by the Committee. The Committee is authorized to establish such rules, to appoint such agents and to delegate such authority as it deems appropriate for the proper administration of the Plan, including, but not limited to, the delegation of authority to such person or persons to exercise the discretion provided in Section 5.1 hereof to determine whether a Participant may exercise an Award subsequent to termination of employment, and to make such determinations and to take such steps in connection with the Plan or the benefits provided hereunder as it deems necessary or advisable. 2.2 Plan Interpretation. The Committee shall have the exclusive authority to interpret the Plan. The decision of the Committee with respect to any question arising as to the grant of an Award to a Participant in the Plan, the amount, term, form, and time of payment of Awards under the Plan, or any other matter concerning the Plan shall be final, conclusive, and binding on both the Company and the Participants. ARTICLE III 3.1 Eligibility. The Participants in the Plan shall be limited to Directors and to those Employees, as determined by the Committee, who have a significant impact on the long-term performance and success of the Company. Subject to the terms of the Plan, the Committee shall identify individuals eligible to become Participants in the Plan, select from time to time the Participants to whom Awards shall be granted and shall determine the number of Awards to be granted. ARTICLE IV 4.1 Awards. (a) General. Beginning February 18, 1997 and thereafter not more frequently than once each calendar year, the Committee shall determine the forms and amounts of Awards for Participants, provided that in no event shall any Award be granted until the shareholders of the Company have approved the Plan. All Awards shall be subject to the terms and conditions of the Plan and to such other terms and conditions consistent with the Plan as the Committee deems appropriate. Awards under the Plan need not be uniform and Awards under two (2) or more paragraphs may be combined in one Award Document. Any combination of Awards may be granted at one time and on more than one occasion to the same Participant. Such Awards may take the following forms, in the Committee's sole discretion: (b) Incentive Stock Options. These shall be stock options within the meaning of Section 422 of the Code to purchase Common Stock. In addition to other restrictions contained in the Plan, an Incentive Stock Option (1) shall not be exercised more than ten (10) years after the date it is granted, (2) shall not have an Option Price less than the Fair Market Value of Common Stock on the date the Incentive Stock Option is granted, (3) shall otherwise comply with Section 422 of the Code, (4) shall be granted only to Employees and (5) shall be designated as an "Incentive Stock Option" by the Committee. The aggregate Fair Market Value of Common Stock determined at the time of each grant for which any Optionee may vest in Incentive Stock Options under this Plan for any calendar year shall not exceed $100,000. (c) Nonqualified Stock Options. These shall be stock options to purchase Common Stock which are not designated by the Committee as "Incentive Stock Options." At the time of the grant, the Committee shall determine the Option exercise period, the Option Price, and such other conditions or restrictions on the exercise of the Nonqualified Stock Option as the Committee deems appropriate. In addition to other restrictions contained in the Plan, a Nonqualified Stock Option (1) shall not be exercised more than ten (10) years after the date it is granted, and (2) shall not have an Option Price less than 100% of the Fair Market Value of Common Stock on the date the Nonqualified Stock Option is granted. (d) Stock Appreciation Rights. These shall be rights that on exercise entitle the holder to receive the excess of (1) the Fair Market Value of Common Stock on the date of exercise over (2) its Base Value multiplied by (3) the number of SAR's exercised. Such rights shall be satisfied in cash, stock, or a combination thereof, as determined by the Committee. Stock Appreciation rights granted under the Plan may be granted in the sole discretion of the Committee in conjunction with an Incentive Stock Option or Nonqualified Stock Option under the Plan. The Committee may impose such conditions or restrictions on the exercise of SAR's as it deems appropriate and may terminate, amend, or suspend such SAR's at any time. SAR's granted under this Plan shall not be exercised more than ten (10) years after the date of grant. (e) Restricted Stock. Restricted Stock shall be shares of Common Stock held by the Company for the benefit of a Participant without payment of consideration, except as otherwise may be determined by the Committee in its discretion, with restrictions or conditions upon the Participant's right to retain, transfer or sell such shares. The following provisions shall be applicable to Restricted Stock Awards: (1) Stock Power. Each certificate for Restricted Stock shall be registered in the name of the Participant and shall be deposited by him with the Company, together with a stock power endorsed in blank. (2) Restriction Period. At the time of making a Restricted Stock Award, the Committee shall establish the "Restriction Period" applicable thereto. Such Restriction Period may be up to ten (10) years as determined by the Committee. The Committee may provide for the annual lapse of restrictions with respect to a specified percentage of the Restricted Stock, provided the Participant satisfies all eligibility requirements at such time. (3) Dividends. The Participant shall be entitled to receive dividends during the Restriction Period and shall have the right to vote such Common Stock and all other shareholder's rights except the following: (i) the Participant shall not be entitled to delivery of the stock certificate during the Restriction Period, (ii) the Company shall retain custody of the Common Stock during the Restriction Period, and (iii) a breach of a restriction or a breach of the terms and conditions established by the Committee with respect to the Restricted Stock shall cause a forfeiture of the Restricted Stock. 4.2 Award Document. After the Committee determines the form and amount of a Participant's Award, it shall cause the Company to prepare an Award Document to be delivered to the Participant setting forth the form and amount of the Award and any conditions and restrictions on the Award imposed by the Plan and the Committee. 4.3 Exercise and Payment. The exercise of an Option shall be made only by a written notice delivered in person or by mail to the Secretary of the Company at the Company's principal executive office, specifying the number of shares of Common Stock to be purchased and accompanied by payment therefore and otherwise in accordance with the Award Document pursuant to which the Option was granted. The purchase price for any shares of Common Stock purchased pursuant to the exercise of an Option shall be paid, as determined by the Committee in its discretion and set forth in the Award Document at the time of grant, in either of the following forms (or any combination thereof): (i) cash or (ii) the transfer of shares of Common Stock with a Fair Market Value equal to the aggregate exercise price of the Option to the Company upon such terms and conditions as determined by the Committee. In addition, Options may be exercised through a registered broker-dealer pursuant to such cashless exercise procedures (other than the withholding of shares of Common Stock that would otherwise be acquired upon the exercise of such Option) which are, from time to time, deemed acceptable by the Committee, and the Committee may authorize that the purchase price payable upon exercise of an Option may be paid by having shares of Common Stock withheld that otherwise would be acquired upon such exercise. Any shares of Common Stock transferred to the Company (or withheld upon exercise) as payment of the purchase price under an Option shall be valued at their Fair Market Value on the day preceding the date of exercise of such Option. The Optionee shall deliver the Award Document evidencing the Option to the Secretary of the Company who shall endorse thereon a notation of such exercise and return such Award Document to the Optionee. No fractional shares of Common Stock (or cash in lieu thereof) shall be issued upon exercise of an Option and the number of shares of Common Stock that may be purchased upon exercise shall be rounded to the nearest number of whole shares of Common Stock. ARTICLE V 5.1 Termination of Service or Employment. A Participant whose service as a Director or employment terminates for reasons other than Retirement, Disability, or death shall, in the discretion of the Committee, have no right to receive any benefit or payment for existing Awards under the Plan. Any outstanding Award shall terminate on the Participant's Separation Date; provided, however, that the Committee or its designee, in its or his sole discretion, may permit the exercise of any outstanding Award after the Participant's Separation Date, at such time and in such manner as the Committee or such designee may determine, but in no event in the case of Incentive Stock Options shall such exercise be beyond the earlier of (a) three (3) months from the Participant's Separation Date or (b) the expiration date of the Award, to the extent exercisable on such Participant's Separation Date. 5.2 Death of a Participant. Unless otherwise provided in the Award Document, in the event of the death of a Participant prior to the exercise of all Incentive Stock Options, Nonqualified Stock Options, and Stock Appreciation Rights granted to such Participant, the administrator of the deceased Participant's estate, the executor under his will, or the person or persons to whom the Options or SAR's shall have been validly transferred by such executor or administrator pursuant to the will or laws of intestate succession shall have the right, within thirty-six (36) months from the date of such Participant's death, but not beyond the expiration date of the Options or SAR's, to exercise such Options or SAR's to the extent exercisable on such Participant's Separation Date. 5.3 Retirement. (a) Incentive Stock Options. In the event of the termination of a Participant's employment as result of his Retirement prior to the exercise of all Incentive Stock Options granted to the Participant, such Participant shall have the right, within three (3) months of his Separation Date, but not beyond the expiration date of such Options, to exercise such Incentive Stock Options to the extent exercisable on his Separation Date. (b) Nonqualified Stock Options and SARs. Unless otherwise provided in the Award Document, in the event of the termination of a Participant's employment as a result of his Retirement prior to the exercise of all Nonqualified Stock Options or Stock Appreciation Rights granted to the Participant, such Participant shall have the right, within thirty-six (36) months of his Separation Date, but not beyond the expiration date of such Nonqualified Stock Options or SAR's, to exercise such Nonqualified Stock Options or SAR's to the extent exercisable on his Separation Date. 5.4 Disability. (a) Incentive Stock Options. In the event of the termination of a Participant's employment due to Disability prior to the exercise of all Incentive Stock Options granted to the Participant, such Participant or his legal representative shall have the right, within twelve (12) months of his Separation Date, but not beyond the expiration date of such Incentive Stock Options, to exercise such Incentive Stock Options to the extent exercisable on his Separation Date. (b) Nonqualified Stock Options and SARs. Unless otherwise provided in the Award Document, in the event of the termination of a Participant's employment due to Disability prior to the exercise of all Nonqualified Stock Options and Stock Appreciation Rights granted to the Participant, such Participant or his legal representative shall have the right, within thirty-six (36) months of his Separation Date, but not beyond the expiration date of such Nonqualified Stock Options or SAR's, to exercise such Nonqualified Stock Options or SAR's to the extent exercisable on his Separation Date. ARTICLE VI 6.1 Limitation of Shares of Common Stock Available under the Plan. (a) Share Limit. The total number of shares of Common Stock available to be granted by the Committee as Awards to the Participants under the Plan shall not exceed 40,000,000 shares. Upon a change in capitalization, the maximum number of shares of Common Stock referred to in the preceding sentence shall be adjusted in number and kind pursuant to Section 7.1 hereof. (b) Share Reduction. The total number of shares available under Section 6.1(a) shall be reduced from time to time in the manner specified: (1) Incentive Stock Options and Nonqualified Stock Options. The grant of an Incentive Stock Option and Nonqualified Stock Option shall reduce the available shares by the number of shares subject to such Option. (2) Stock Appreciation Rights. The grant of Stock Appreciation Rights shall reduce the available shares by the number of SAR's granted; provided, however, if SAR's are granted in conjunction with an Option and the exercise of such Option would cancel the SAR's and vice versa, then the grant of the SAR's will only reduce the amount available by the excess, if any, of the number of SAR's granted over the number of shares subject to the related Option. (3) Restricted Stock. The grant of Restricted Stock shall reduce the available shares by the number of shares of Restricted Stock granted. (c) Share Increase. The total number of shares available under Section 6.1(a) shall be increased from time to time in the manner specified: (1) Incentive Stock Options and Nonqualified Stock Options. The lapse or cancellation of an Incentive Stock Option or Nonqualified Stock Option shall increase the available shares by the number of shares released from such Option; provided, however, in the event the cancellation of an Option is due to the exercise of SAR's related to such Option, the cancellation of such Option shall only increase the amount available by the excess, if any, of the number of shares released from such Option over the number of SAR's exercised. (2) Stock Appreciation Rights. The lapse or cancellation of Stock Appreciation Rights shall increase the available shares by the number of SAR's which lapse or are canceled; provided, however, in the event the cancellation of such SAR's is due to the exercise of an Option related to such SAR's, the cancellation of such SAR's shall only increase the available shares by the excess, if any, of the number of SAR's canceled over the number of shares delivered on the exercise of such Option. (3) Restricted Shares. The reversion of Restricted Stock to the Company due to the breach or occurrence of a restriction or failure to satisfy a condition on such shares shall increase the available shares by the number of shares of Restricted Stock reverted. 6.2 Maximum Shares to Participant. The maximum number of shares of Common Stock which may be the subject of any Award to a Participant during any calendar year during the term of the Plan shall be 1,000,000. ARTICLE VII 7.1 Adjustment Upon Changes in Capitalization. The total number of shares of Common Stock available for Awards under the Plan or allocable to any individual Participant, the number of shares of Common Stock subject to outstanding Options, the exercise price for such Options, the number of outstanding SAR's, the Base Value of such SAR's and the Award limit set forth in subsection 6.2 shall be appropriately adjusted by the Committee in the event of any increase or decrease in the number of outstanding shares of Common Stock resulting from any change in the Company's capital structure, including but not limited to any stock dividend, subdivision or combination of shares, or reclassification. 7.2 Merger, Consolidation or Tender Offer. In the event of a merger or consolidation of the Company or a tender offer for shares of Common Stock, the Committee may make such adjustments with respect to Awards under the Plan and take such other action as it deems necessary or appropriate to reflect, or in anticipation of, such merger, consolidation, or tender offer, including without limitation the substitution of new Awards, the termination or adjustment of outstanding Awards, the acceleration of Awards, or the removal of limitations or restrictions on outstanding Awards. ARTICLE VIII 8.1 Withholding Taxes. The Company or the Employing Company, as the case may be, of the Participant shall deduct from all payments and distributions in cash under the Plan any taxes required to be withheld for federal, state, or local governments. In the event distributions are made in shares of Common Stock, the Company shall retain the value of sufficient shares to equal the amount of the tax required to be withheld in respect of such distributions. 8.2 Service or Employment. The establishment of the Plan and Awards hereunder shall not be construed as conferring on any Participant any right to continued service or employment, and the service or employment of any Participant may be terminated without regard to the effect which such action might have upon him or her as a Participant. 8.3 Non-Alienation of Benefits. Unless otherwise provided in the Participant's Award Document with respect to Awards other than Incentive Stock Options, and other than as specifically provided with regard to the death of a Participant, no benefit under the Plan shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, or charge, excluding the use of Options under this Plan as collateral in exercising such Options. Any attempt to do so shall be null and void. No such benefits shall, prior to receipt thereof by the Participant, be in any manner liable for or subject to the debts, contracts, liabilities, engagement, or torts of the Participant. 8.4 Non-Alienation of Election or Exercise Rights. Unless otherwise provided in the Participant's Award Document with respect to Awards other than Incentive Stock Options, no election as to benefits or exercise of Options, Stock Appreciation Rights, or other rights may be made during a Participant's lifetime by anyone other than the Participant. 8.5 Amendment, Modification, and Termination of the Plan. The Board of Directors, at any time, may terminate and in any respect amend or modify the Plan; provided, however, that no such action by the Board of Directors, without approval of the Company's shareholders, may increase the total number of shares of Common Stock available under the Plan; and further provided that, except as provided in Section 7.2, no amendment, modification, or termination of the Plan shall in any manner adversely affect the rights of any Participant under the Plan without the consent of such Participant. 8.6 Indemnification. Each person who is or shall have been a member of the Committee or of the Board of Directors shall be indemnified and held harmless by the Company against and from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him in connection with or resulting from any claim, action, suit, or proceeding to which he may be a party or in which he may be involved by reason of any action or failure to act under the Plan and against and from any and all amounts paid by him in satisfaction of judgment in any such action, suit, or proceeding against him. Such person shall give the Company an opportunity, at its own expense, to handle and defend the same before he undertakes to handle and defend it on his own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company's Articles of Incorporation or Bylaws, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless. 8.7 Reliance on Reports. Each member of the Committee and each member of the Board of Directors shall be fully justified in relying or acting in good faith upon any report made by the independent public accountants of the Company and any Employing Company and upon any other information furnished in connection with the Plan by any person or persons other than himself. In no event shall any person who is or shall have been a member of the Committee or the Board of Directors be liable for any determination made or other action taken or any omission to act in reliance upon any such report or information or for any action taken, including the furnishing of information, or failure to act, if in good faith. 8.8 Governing Law. To the extent that federal law shall not be held to have preempted local law, this Plan shall be governed by the laws of the State of Delaware. If any provision of the Plan shall be held invalid or unenforceable, the remaining provisions hereof shall continue in full force and effect. IN WITNESS WHEREOF, the Company has caused the Southern Company Performance Stock Plan to be executed by its duly authorized officers pursuant to resolutions of the Board of Directors as of the 18th day of February 1997, to be effective February 18, 1997. SOUTHERN COMPANY By:___________________________________ A. William Dahlberg President Attest: By:____________________________ Tommy Chisholm Secretary [CORPORATE SEAL] EX-99 3 EXHIBIT F Exhibit F Troutman Sanders LLP Atlanta, Georgia March 31, 1997 Securities and Exchange Commission Washington, D.C. Re: Statement on Form U-1 of The Southern Company (the "Company") Ladies and Gentlemen: We are familiar with the statement on Form U-1 referred to above relating to (i) the Southern Company Performance Stock Plan (the "Plan") and (ii) the solicitation of proxies from the Company's stockholders in connection with the Plan, and we are familiar with the proceedings relating thereto. We are of the opinion that the Company is a validly organized and duly existing corporation under the laws of the State of Delaware and that, upon the issuance of your order or orders permitting such statement on Form U-1 to become effective, upon the adoption of an appropriate resolution by the stockholders of the Company, upon compliance with the Securities Act of 1933, as amended, and with such State securities or "blue sky" laws as may be applicable, and upon the proposed transactions being consummated in accordance with such statement on Form U-1 and such order or orders and in accordance with the Plan: (a) all State laws applicable to the proposed transactions will have been complied with; (b) the common stock, par value $5.00 per share, of the Company proposed to be issued pursuant to the Plan will be fully paid and nonassessable and the holders of such common stock will be entitled to the rights and privileges appertaining thereto set forth in the Certificate of Incorporation of the Company, as amended; and (c) the consummation of the proposed transactions will not violate the legal rights of the holders of any securities issued by the Company or any associate company thereof. We hereby consent to the filing of this opinion as an exhibit to the above-mentioned statement on Form U-1. Very truly yours, /s/ Troutman Sanders LLP EX-99 4 EXHIBIT G-1 CONFIDENTIAL DRAFT 3/27/97 3:12 PM [GRAPHIC OMITTED] NOTICE OF ANNUAL MEETING OF STOCKHOLDERS -- May 28, 1997 Dear Stockholder: The Annual Meeting of Stockholders of THE SOUTHERN COMPANY will be held at the Hyatt Regency Atlanta, 265 Peachtree Street, Atlanta, Georgia on Wednesday, May 28, 1997, at 10:00 a.m. (EDT), for the following purposes: (1) Electing 14 members of the board of directors; (2) Approving amendments to the Southern Company Executive Productivity Improvement Plan; (3) Approving the Southern Company Performance Stock Plan; (4) Approving the Southern Company Performance Dividend Plan; and (5) Transacting such other business as may properly come before the meeting or any adjournments thereof. Your vote is important. Please use the toll-free telephone number on the enclosed proxy card or mark, date, sign, and promptly return the enclosed form of proxy in the enclosed postage-paid envelope. If you attend the annual meeting, you may revoke this proxy by voting in person. Only stockholders of record at the close of business on March 31, 1997, are entitled to vote at the meeting. By Order of the Board of Directors, Tommy Chisholm Secretary Atlanta, Georgia April 17, 1997 EX-99 5 EXHIBIT G-2 CONFIDENTIAL DRAFT 3/27/97 3:12 PM 3. PROPOSAL TO APPROVE THE COMPANY'S PERFORMANCE STOCK PLAN The Southern Company Executive Stock Plan (the "former plan") adopted by the board of directors on December 7, 1987, and approved by the stockholders on May 25, 1988, expires in 1997. The Southern Company Performance Stock Plan (the "Plan") was adopted by the board of directors on February 17, 1997, subject to stockholder approval. The purpose of the Plan is to maximize the long-term success of the Company, to ensure a balanced emphasis on both current and long-term performance, to enhance Plan participants' identification with stockholders' interests, and to facilitate the attraction and retention of key individuals with outstanding ability. The Plan is administered by the Compensation & Management Succession Committee of the board of directors of the Company (the "committee"). The committee consists of three or more directors of the Company who are not employees of the Company or its subsidiaries. The committee has exclusive authority to interpret the Plan. The Plan permits the committee to grant not more frequently than once each calendar year, in its discretion, Incentive Stock Options and Nonqualified Stock Options (collectively, "Stock Options"), Stock Appreciation Rights, and Restricted Stock to directors of the Company and those employees who have a significant impact on the long-term performance and success of the Company. The committee has determined that the approximate number of participants under the Plan initially will be 250, but may be changed at the committee's discretion. Nonqualified Stock Options entitle the participant to purchase up to the number of shares of the Company's common stock ("Common Stock") specified in the grant at a specified price (the "Option Price"). The Option Price, which cannot be lower than the fair market value of the Common Stock on the grant date, is set by the committee at the time a grant is made. Stock Options designated by the committee as Incentive Stock Options are intended to comply with Section 422 of the Internal Revenue Code. They will be granted only to employees and entitle the participant to purchase the specified number of shares of Common Stock at the Option Price. The aggregate fair market value of Common Stock determined at the time of each grant for which any participant may vest in Incentive Stock Options under the Plan for any calendar year shall not exceed $100,000. Stock Appreciation Rights are rights that, when exercised, entitle the participant to the appreciation in value of the number of shares of Common Stock specified in the grant, from the date granted to the date exercised. The exercised Stock Appreciation Right may be paid in cash or Common Stock, as determined by the committee. Stock Appreciation Rights may be granted in the sole discretion of the committee in conjunction with an Incentive Stock Option or Nonqualified Stock Option. Stock Options and Stock Appreciation Rights may not be exercised more than 10 years after the date granted. Restricted Stock awards are grants of shares of Common Stock that are held by the Company for the benefit of the participant without payment of consideration by the participant. There are restrictions or conditions on the participant's right to transfer or sell such shares. The committee will establish a "Restriction Period" of from one through 10 years for each Restricted Stock award made. The participant will be entitled to dividends paid on the Restricted Stock and will have the right to vote such shares. Stock Options must be paid in full when exercised by the participant. The committee, in its discretion, may permit the Option Price to be paid in whole or in part through the transfer to the Company of shares of Common Stock previously acquired by the participant. A total of 40 million shares of Common Stock is available for grants under the Plan. The committee anticipates only granting Nonqualified Stock Options under the Plan at this time, however, the other types of awards provided for in the Plan may be granted in the future. Under the Plan, the maximum number of shares of Common Stock which may be the subject of any award to a participant during any calendar year is 1,000,000 shares. On March 28, 1997, the closing price per share of Common Stock reported on the New York Stock Exchange Composite Tape was $______. The board of directors may terminate or amend the Plan at any time; provided, however, without stockholder approval, the board may not increase the total number of shares of Common Stock available for grants under the Plan. The Plan will terminate February 17, 2007, unless terminated sooner by the board of directors. Federal Income Tax Consequences of Stock Options Granted under the Plan The following is a summary of some of the more significant Federal income tax consequences under present law of the granting and exercise of Stock Options under the Plan. No taxable income is realized by a participant upon the grant of a Stock Option, and no deduction is then available to the Company. Upon exercise of a Stock Option, the excess of the fair market value of the shares of Common Stock on the date of exercise over the exercise price will be taxable to the participant as ordinary income and, subject to any limitation imposed by Section 162(m) of the Internal Revenue Code (the "Code"), deductible by the Company. The board is seeking stockholder approval of the Plan partly in order to qualify all compensation to be paid under the Plan for full income tax deductibility under Section 162(m) of the Code. Section 162(m) of the Code generally limits tax deductibility of certain compensation paid to each of the Company's five most highly compensated executive officers to $1,000,000, per officer, unless the compensation is paid under a performance plan, meeting certain criteria under the Code, that has been approved by its stockholders. If a participant disposes of any shares of Common Stock received upon the exercise of any Stock Option granted under the Plan, such participant will realize a capital gain or loss equal to the difference between the amount realized on disposition and the value of such shares at the time the Stock Option was exercised. The gain or loss will be either long-term or short-term, depending on the holding period measured from the date of exercise. The Company will not be entitled to any further deduction at that time. The Company is required to withhold and remit to the Internal Revenue Service income taxes on all compensation which is taxable as ordinary income. Upon exercise of Stock Options, as a condition of such exercise, a Participant must pay or arrange for payment to the Company of cash representing the appropriate withholding taxes generated by the exercise. The following table sets forth the estimated number and dollar value of Nonqualified Stock Options that could be granted under the Plan in 1997 to the individuals and groups indicated:
Stock Plan Name and Position Number of Options Dollar Value ($) ----------------- ----------------- ---------------- A. W. Dahlberg, Chairman, President & CEO, The Southern Company.......... 133,142 (1) T. G. Boren, President, Southern Energy ................................. 18,560 (1) P. J. DeNicola, President, Southern Company Services..................... 29,040 (1) H. A. Franklin, President, Georgia Power Company ........................ 35,807 (1) E. B. Harris, President, Alabama Power Company .......................... 34,929 (1) Executive officers as a group ........................................... 324,763 (1) Non-executive directors as a group ...................................... 0 0 Non-executive officer employees ......................................... 39,969 (1)
(1) The actual value a Participant may realize, if any, will depend on the excess of the fair market value of the Common Stock over the Option Price on the date exercised. The average of the high and low price of the Common Stock on March 28, 1997, was $____. The vote needed to approve the Plan is a majority of the shares of the Company's stock represented at the meeting and entitled to vote. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL No. 3. EX-99 6 EXHIBIT G-3 DRAFT [GRAPHIC OMITTED] PROXY FORM PROXY FORM PROXY SOLICITED ON BEHALF OF BOARD OF DIRECTORS FOR ANNUAL MEETING OF STOCKHOLDERS MAY 28, 1997 The undersigned hereby appoints A. W. DAHLBERG and W. L. WESTBROOK, or either of them, proxies with full power of substitution in each, to vote all shares the undersigned is entitled to vote at the Annual Meeting of Stockholders of THE SOUTHERN COMPANY, to be held at the Hyatt Regency, 265 Peachtree Street, Atlanta, Georgia at 10:00 a.m. (EDT), and any adjournments thereof, on all matters legally coming before the meeting including, without limitation, the proposals listed on the reverse side hereof. THIS PROXY WILL BE VOTED AS SPECIFIED BY THE UNDERSIGNED. IF NO CHOICE IS SPECIFIED, THE PROXY WILL BE VOTED FOR THE ELECTION OF ALL NOMINEES FOR DIRECTOR LISTED ON THE REVERSE SIDE, AND FOR ITEMS 2, 3, AND 4. Please date, sign exactly as your name appears on the form and mail the proxy promptly. When signing as an attorney, executor, administrator, trustee or guardian, please give your full title as such. If shares are held jointly, both owners must sign. Continued and to be voted and signed on reverse. UNLESS OTHERWISE SPECIFIED BELOW, THIS PROXY WILL BE VOTED "FOR" ALL ITEMS. (1) ELECTION OF DIRECTORS: J. C. Adams, A. D. Correll, A. W. Dahlberg, P. J. DeNicola, J. Edwards, H. A. Franklin, B. S. Gordon, L. G. Hardman, III, E. B. Harris, W. A. Parker, Jr., W. J. Rushton, III, G. M. Shatto, G. J. St. Pe, H. Stockham.
(INSTRUCTIONS: To withhold authority to vote for any individual nominee, write that nominee's name in the space provided below.) ( )FOR ( )WITHHOLD all nominees, listed authority to vote for all ___________________________________________ above (except as nominees listed above. marked to the con- trary to the right.
THE DIRECTORS RECOMMEND A VOTE "FOR" ITEMS 2-4. (2) Approval of amendments to the Company's Executive Productivity Improvement Plan. FOR AGAINST ABSTAIN ( ) ( ) ( ) (3) Approval of the Company's Performance Stock Plan. FOR AGAINST ABSTAIN ( ) ( ) ( ) (4) Approval of the Company's Performance Dividend Plan. FOR AGAINST ABSTAIN ( ) ( ) ( ) Mark here if attending annual meeting. ( ) Signature(s) Date , 1997 EX-99 7 EXHIBIT H Exhibit H The Southern Company (70-____) Notice of Issuance and Sale of Common Stock; Order Authorizing Proxy Solicitation The Southern Company ("Southern"), 270 Peachtree Street, N.W., Atlanta, Georgia 30303, a registered holding company, has filed a declaration pursuant to Sections 6(a), 7 and 12(e) of the Act and Rules 62 and 65 thereunder. Southern proposes, from time to time through February 17, 2007, to grant Incentive Stock Options, Nonqualified Stock Options, Stock Appreciation Rights and Restricted Stock (collectively, "Awards"), and to issue shares of its common stock, par value $5.00 per share, pursuant to the Southern Company Performance Stock Plan ("Plan"). A total of 40,000,000 shares of common stock is available for grants by the Compensation Management Succession Committee ("Committee") of the Board of Directors of Southern pursuant to the Plan. The Plan permits the Committee to grant, in its discretion, Awards to directors of Southern or certain of its subsidiaries and those employees, as determined by the Committee, who have a significant impact on the long-term performance and success of Southern. Southern has filed its proxy solicitation material relating to the Plan and requests that the effectiveness of its declaration with respect to the solicitation of proxies for voting by its shareholders on the proposal to approve the Plan be permitted to become effective as provided in Rule 62. Southern proposes to mail the notice of meeting, proxy statement and proxy to its shareholders for the meeting on May 28, 1997. It appearing to the Commission that Southern's declaration regarding the proposed solicitation of proxies should be permitted to become effective forthwith, pursuant to Rule 62: IT IS ORDERED, that the declaration regarding the proposed solicitation of proxies be, and it hereby is, permitted to become effective forthwith, pursuant to Rule 62 and subject to the terms and conditions prescribed in Rule 24 under the Act. For the Commission, by the Division of Investment Management, pursuant to delegated authority. -----END PRIVACY-ENHANCED MESSAGE-----