Exhibit 1.1
$575,000,000 6.250% Senior Notes, Series A due July 15, 2012
SOUTHERN POWER COMPANY
PURCHASE AGREEMENT
June 13, 2002
Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxxx Xxxxx Barney Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
As Representatives of the Several Initial Purchasers named on Schedule I
hereto
Ladies and Gentlemen:
Southern Power Company, a Delaware corporation (the
"Company"), confirms its agreement (the "Agreement") with you and each of the
other Initial Purchasers named in Schedule I hereto (collectively, the "Initial
Purchasers", which term shall also include any initial purchaser substituted as
hereinafter provided in Section 10 hereof) for whom you are acting as
representatives (in such capacity you shall hereinafter be referred to as the
"Representatives"), with respect to the sale by the Company and the purchase by
the Initial Purchasers, acting severally and not jointly, of $575,000,000
aggregate principal amount of the 6.250% Senior Notes, Series A due July 15,
2012 (the "Senior Notes") as set forth in Schedule I hereto.
The Senior Notes will be offered without being registered
under the Securities Act of 1933, as amended (the "Securities Act"), in reliance
on certain exemptions therefrom and in transactions not subject thereto. The
Company has prepared a preliminary offering memorandum, dated June 11, 2002,
including any and all annexes attached thereto, (the "Preliminary Offering
Memorandum") and an offering memorandum, dated the date hereof, including any
and all annexes attached thereto, (the "Offering Memorandum") setting forth
information regarding the Company and the transactions described herein.
The Senior Notes will be issued pursuant to an indenture,
dated as of June 1, 2002 (the "Base Indenture"), between the Company and The
Bank of New York, as trustee (the "Trustee"), as supplemented by a first
supplemental indenture to the Base Indenture relating to the Senior Notes (the
"Supplemental Indenture," and together with the Base Indenture and any other
amendments or supplements thereto, the "Indenture"), between the Company and the
Trustee.
The Initial Purchasers and their direct and indirect
transferees will be entitled to the benefits of a Registration Rights Agreement,
dated the date hereof (the "Registration Rights Agreement") pursuant to which
the Company will file with the Securities and Exchange Commission (the
"Commission") (i) a registration statement under the Securities Act (the
"Exchange Offer Registration Statement") registering an issue of notes of the
Company ("Exchange Notes") which are identical in all material respects to the
Senior Notes (except the Exchange Notes will not contain terms with respect to
transfer restrictions and additional interest) and (ii) under certain
circumstances, a shelf registration statement pursuant to Rule 415 under the
Securities Act (the "Shelf Registration Statement").
Capitalized terms used but not defined herein shall have the
meanings assigned thereto in the Offering Memorandum.
SECTION 1. REPRESENTATIONS AND WARRANTIES. The Company
represents and warrants to the Initial Purchasers as follows:
(a) The Offering Memorandum does not on the date of this Agreement
and, as it may be then amended and supplemented, will not on the Closing
Date, contain an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading; except
that this representation and warranty does not apply to (i) statements or
omissions made in reliance upon and in conformity with written information
furnished to the Company by or on behalf of any Initial Purchaser
specifically for use in the Offering Memorandum and (ii) the Independent
Engineer's Report or the Independent Market Expert's Report attached as
Annex A and Annex B, respectively, to the Offering Memorandum. The factual
information provided by the Company to X.X. Xxxx, Inc. ("Xxxx") for
inclusion in its Independent Engineer's Report contained in Annex A to the
Offering Memorandum was to the Company's knowledge, accurate in all
material respects as of the time it was furnished.
(b) The Preliminary Offering Memorandum, as of its date, did not
contain an untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that the
Company makes no warranty or representation to the Initial Purchasers with
respect to: (i) statements or omissions made in reliance upon and in
conformity with written information furnished to the Company by or on
behalf of any Initial Purchaser specifically for use in the Preliminary
Offering Memorandum and (ii) the Independent Engineer's Report or the
Independent Market Expert's Report attached as Annex A and Annex B,
respectively, to the Preliminary Offering Memorandum.
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(c) The historical financial statements of the Company and its
predecessor (such predecessor entity hereinafter referred to as "Plant
Xxxxxxxx") contained in the Offering Memorandum have been prepared in
conformity with generally accepted accounting principles in the United
States and fairly present the financial position of the Company and Plant
Xxxxxxxx as of the dates set forth therein. The pro forma financial
statements of Plant Xxxxxxxx included in the Offering Memorandum present
fairly the information shown therein, have been prepared in accordance with
the Commission's rules and guidelines with respect to pro forma financial
statements and have been properly compiled on the bases described therein,
and the assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the transactions
and circumstances referred to therein.
(d) Since the date as of which information is given in the Offering
Memorandum, except as otherwise stated therein, there has been no material
adverse change in the business, properties or financial condition of the
Company.
(e) The Company is a corporation duly organized and existing under the
laws of the State of Delaware and has due corporate authority to conduct
its business and to own and operate the properties used by it in such
business, as described in the Offering Memorandum, to enter into and
perform its obligations under this Agreement, the Registration Rights
Agreement and the Indenture and to issue and sell the Senior Notes to the
Initial Purchasers.
(f) This Agreement has been duly authorized, executed and delivered by
the Company.
(g) The Indenture has been duly authorized by the Company and, on the
Closing Date, will have been duly executed and delivered by the Company,
and, assuming due authorization, execution and delivery of the Indenture by
the Trustee, the Indenture will, on the Closing Date, constitute a valid
and binding obligation of the Company, enforceable against the Company in
accordance with its terms except to the extent that enforcement thereof may
be limited by (1) bankruptcy, insolvency, reorganization, receivership,
liquidation, fraudulent conveyance, moratorium or other similar laws
affecting creditors' rights generally or (2) general principles of equity
(regardless of whether enforcement is considered in a proceeding at law or
in equity) (the "Enforceability Exceptions"); the Indenture will conform in
all material respects to all statements relating thereto contained in the
Offering Memorandum.
(h) The issuance and delivery of the Senior Notes have been duly
authorized by the Company and, on the Closing Date, the Senior Notes will
have been duly executed by the Company and, when authenticated in the
manner provided for in the Indenture and delivered against payment therefor
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as described in the Offering Memorandum, will constitute valid and legally
binding obligations of the Company, enforceable against the Company in
accordance with their terms, except to the extent that enforcement thereof
may be limited by the Enforceability Exceptions; the Notes will be in the
form contemplated by, and entitled to the benefits of, the Indenture and
will conform in all material respects to all statements relating thereto in
the Offering Memorandum.
(i) The Registration Rights Agreement has been duly authorized by the
Company and, on the Closing Date, will have been duly executed and
delivered by the Company and, assuming due authorization, execution and
delivery of the Registration Rights Agreement by the other parties thereto,
the Registration Rights Agreement will, on the Closing Date, constitute a
valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms except to the extent the enforcement
thereof may be limited by the Enforceability Exceptions and except as
indemnification or contribution obligations thereunder may be limited under
applicable laws; the Registration Rights Agreement will conform in all
material respects to all statements relating thereto in the Offering
Memorandum.
(j) Neither the Company nor any of its affiliates (as defined in Rule
501(b) of Regulation D under the Securities Act, an "Affiliate") has
directly, or through any agent, (i) sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of any security (as
defined in the Securities Act) which is or will be integrated with the sale
of the Senior Notes in a manner that would require the registration under
the Securities Act of the Senior Notes or (ii) engaged in any form of
general solicitation or general advertising in connection with the offering
of the Senior Notes (as those terms are used in Regulation D under the
Securities Act), or acted in any manner involving a public offering of the
Senior Notes within the meaning of Section 4(2) of the Securities Act.
(k) The Senior Notes are eligible for resale pursuant to Rule 144A
under the Securities Act ("Rule 144A") and will not be, at the Closing
Date, of the same class (within the meaning of Rule 144A) as securities
listed on a national securities exchange registered under Section 6 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or quoted
in a U.S. automated inter-dealer quotation system.
(l) With respect to those Senior Notes sold in reliance on Regulation
S under the Securities Act, (i) none of the Company, its Affiliates or any
person acting on its or their behalf (other than the Initial Purchasers, as
to whom the Company makes no representation) has engaged or will engage in
any directed selling efforts within the meaning of Regulation S and (ii)
each of the Company and its Affiliates and any person acting on its or
their behalf (other than the Initial Purchasers, as to whom the Company
makes no representation) has complied and will comply with the offering
restrictions requirement of Regulation S.
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(m) The execution, delivery and performance by the Company of this
Agreement, the Registration Rights Agreement, the Indenture and the Senior
Notes and the consummation by the Company of the transactions contemplated
herein and therein and compliance by the Company with its obligations
hereunder and thereunder shall have been duly authorized by all necessary
corporate action on the part of the Company and do not and will not result
in any violation of the charter or bylaws of the Company, and do not and
will not conflict with, or result in a breach of any of the terms or
provisions of, or constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets
of the Company under (A) any contract, indenture, mortgage, loan agreement,
note, lease or other agreement or instrument to which the Company is a
party or by which it may be bound or to which any of its properties may be
subject (except for conflicts, breaches or defaults which would not,
individually or in the aggregate, be materially adverse to the Company or
materially adverse to the transactions contemplated by this Agreement), or
(B) any existing applicable law, rule, regulation, judgment, order or
decree of any government, governmental instrumentality or court, domestic
or foreign, or any regulatory body or administrative agency or other
governmental body having jurisdiction over the Company, or any of its
properties.
(n) No authorization, approval, consent or order of any court or
governmental authority or agency is necessary in connection with the
issuance and sale by the Company of the Senior Notes or the transactions by
the Company contemplated in this Agreement and the Offering Memorandum,
except (A) such as may be required under the Public Utility Holding Company
Act of 1935, as amended (the "Holding Company Act"); (B) such consents,
approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws and (C) such consents,
approvals, authorizations, registrations and qualifications as may be
required under the Securities Act and the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act") in connection with the transactions
contemplated in the Registration Rights Agreement.
(o) The projected financial information contained in the Offering
Memorandum (excluding the Independent Market Expert's Report, attached as
Annex B to the Offering Memorandum) (i) are, in the judgment of the Company
as to the matters covered thereby, reasonable as of their date and (ii) are
based on easonable assumptions as to all factual and legal matters
material to the estimates therein, all of which assumptions, to the extent
material, are fairly disclosed in the Offering Memorandum. To the knowledge
of the Company, none of the information forming the basis of such
projections and assumptions has changed since they were originally prepared
so as to materially affect such projections and assumptions.
(p) Assuming the accuracy of the Initial Purchasers' representations
contained herein, and the Initial Purchasers' compliance with its
agreements hereunder, the Company is not required by applicable law or
regulation, in connection with the offer, sale and delivery of the Senior
Notes to the Initial Purchasers, and the initial resales by the Initial
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Purchasers, each in the manner contemplated by this Agreement and the
Offering Memorandum, to register the Senior Notes under the Securities Act
or to qualify the Indenture under the Trust Indenture Act.
SECTION 2. SALE AND DELIVERY TO THE INITIAL PURCHASERS;
CLOSING; SALE AND RESALE BY THE INITIAL PURCHASERS.
(a) On the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the
Company agrees to sell to each Initial Purchaser, and each Initial
Purchaser, severally and not jointly, agrees to purchase from the Company,
the principal amount of Senior Notes set forth in Schedule I to this
Agreement opposite the name of such Initial Purchaser (plus any additional
amount of Senior Notes that such Initial Purchaser may become obligated to
purchase pursuant to the provisions of Section 10 hereof), at the prices
set forth in Schedule I to this Agreement.
(b) Payment for and delivery of certificates for the Senior Notes
shall be made at the offices of Xxxxx Xxxxxxxxxx LLP, 0000 Xxxxxx xx xxx
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 at 10:00 A.M., New York time, on June
18, 2002 (unless postponed in accordance with the provisions of Section 10)
or such other time, place or date as shall be agreed upon by the
Representatives and the Company (such time and date of payment and delivery
being herein called the "Closing Date"). Payment shall be made to the
Company by wire transfer in federal funds at the Closing Date gainst
delivery of the Senior Notes to Xxxxxxx Xxxxx Xxxxxx Inc. ("SSB"). It is
understood that each Initial Purchaser has authorized SSB, for its account,
to accept delivery of, receipt for, and make payment of the principal
amount of the Senior Notes which it has agreed to purchase. SSB,
individually and not as Representatives of the Initial Purchaser, may (but
shall not be obligated to) make payment of the principal amount of the
Senior Notes to be purchased by any Initial Purchaser whose payment has not
been received by the Closing Date, but such payment shall not relieve such
Initial Purchaser from its obligations hereunder.
(c) The Senior Notes in which interests are sold to Qualified
Institutional Buyers (as defined in Rule 144A) in reliance on Rule 144A
will be issued in the form of one or more Global Notes (the "Rule 144A
Global Notes"). The Senior Notes in which interests are sold to persons
other than U.S. persons (as defined in Regulation S under the Securities
Act ("Regulation S")) in offshore transactions in reliance on Regulation S
will each be issued in the form of one or more Global Notes (the
"Regulation S Global Notes"). Upon issuance by the Company, the Trustee
will authenticate and deliver the Rule 144A Global Notes and the Regulation
S Global Notes and will record Cede & Co., as the nominee of DTC, on its
books as the registered owner of the Senior Notes. The Senior Notes in
which interests are sold to a limited number of institutional investors who
are "accredited investors" (as defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act) will be issued in certificated form without
coupons and registered in such names as each Initial Purchaser may request
upon at least forty-eight hours' prior notice to the Company.
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For the purpose of expediting the checking of the Senior Notes
by the Initial Purchasers, the Company agrees to make the Senior Notes available
to the Initial Purchasers for such purpose at the offices of the Trustee in New
York, New York not later than 2:00 PM, New York City time, on the business day
preceding the Closing Date, or at such other time and place as may be agreed
upon by the Company and the Initial Purchasers.
(d) Resale of the Securities: Each Initial Purchaser represents and
warrants to, and agrees with the Company that:
(1) It is a Qualified Institutional Buyer and an "accredited investor"
within the meaning of Rule 501(a) under the Securities Act;
(2) It has not offered or sold, and will not offer or sell, Senior
Notes except (i) to persons whom it reasonably believes to be Qualified
Institutional Buyers or, if any such person is buying for one or more
institutional accounts for which such person is acting as fiduciary or
agent, only when such person has represented to such Initial Purchaser that
each such account is a Qualified Institutional Buyer to whom such notice
has been given that such sale or delivery is being made in reliance on Rule
144A, in each case in transactions meeting the requirements of Rule 144A,
(ii) to a limited number of other institutional investors whom the Company
believes to be "accredited investors" (as defined in Rule 501(a) (1), (2),
(3) or (7) of Regulation D) that, prior to their purchase of the Senior
Notes, deliver to it a letter substantially in the form of Annex C to the
Offering Memorandum or (iii) in the case of offers outside the United
States to persons other than U.S. Persons (within the meaning of Regulation
S) to whom it reasonably believes offers and sales of the Senior Notes may
be made in reliance upon Regulation S under the Securities Act; and
(3) Neither it nor any of its Affiliates or any person acting on its
or their behalf has made or will make offers or sales of Senior Notes in
the United States by means of any form of general solicitation or general
advertising (within the meaning of Regulation D) or in any mannerinvolving
a public offering (within the meaning of Section 4(2) under the Securities
Act) in the United States.
(e) Each Initial Purchaser represents, warrants, and agrees with
respect to offers and sales outside the United States that:
(1) such Initial Purchaser understands that no action has been or will
be taken in any jurisdiction by the Company that would permit a public
offering of the Senior Notes, or possession or distribution of the Offering
Memorandum or Preliminary Offering Memorandum or any other offering or
publicity materialrelating to the Senior Notes, in any country or
jurisdiction where action for that purpose is required;
(2) such Initial Purchaser will comply with all applicable laws and
regulations in each jurisdiction in which it acquires, offers, sells or
delivers Senior Notes or has in its possession or distributes the Offering
Memorandum or Preliminary Offering Memorandum or any such other material,
in all cases at its own expense;
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(3) the Senior Notes have not been registered under the Securities Act
and may not be offered or sold within the United States or to, or for the
account or benefit of, U.S. persons except in accordance with Rule 144A or
Regulation S or pursuant to another exemption from, or in transactions not
subject to, the registration requirements of the Securities Act;
(4) such Initial Purchaser has offered the Senior Notes and will offer
and sell the Senior Notes (A) as part of its distribution at any time and
(B) otherwise until 40 days after the later of the commencement of the
offering and the Closing Date, only in accordance with Rule 903 of
Regulation S or as otherwise permitted in Section 2(d) of this Agreement;
accordingly, neither such Initial Purchaser, its Affiliates nor any persons
acting on its or their behalf have engaged or will engage in any directed
selling efforts (within the meaning of Regulation S) with respect to the
Senior Notes, and the Initial Purchaser, its Affiliates and any such
persons have complied and will comply with the offering restrictions
requirement of Regulation S;
(5) such Initial Purchaser has (A) not offered or sold and will not
offer or sell any Senior Notes to persons in the United Kingdom except to
persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for the
purposes of their businesses or otherwise in circumstances which have not
resulted and will not result in an offer to the public in the United
Kingdom within the meaning of the Public Offers of Securities Regulations
1995; (B) only communicated or caused to be communicated and will only
communicate or cause to be communicated any invitation or inducement to
engage in investment activity (within the meaning of Section 21 of the
Financial Services and Markets Act 2000 (the "FSMA")) received by it in
connection with the issue or sale of any Senior Notes in circumstances in
which Section 21(1) of the FSMA does not apply to the Company and (C)
complied and will comply with all applicable provisions of the FSMA with
respect to anything done by it in relation to the Senior Notes in, from or
otherwise involving the United Kingdom; and
(6) such Initial Purchaser agrees that, at or prior to confirmation of
sales of the Senior Notes, it will have sent to each distributor, dealer or
person receiving a selling concession, fee or other remuneration that
purchases Senior Notes from it during the restricted period a confirmation
or notice to substantially the following effect:
"The Securities covered hereby have not been registered
under the U.S. Securities Act of 1933, as amended (the "Securities Act") and
may not be offered and sold within the United States or to, or for the
account or benefit of, U.S. persons (i) as part of their distribution at any
time or (ii) otherwise until 40 days after the later of the commencement of
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the offering and the closing date, except in either case in accordance with
Regulation S (or Rule 144A or any other exemption from the registration
requirements of the Securities Act if available) under the Securities Act.
Terms used above have the meaning given to them by Regulation S."
Terms used in this Section 2(e) have the meanings given to them by Regulation S.
SECTION 3. COVENANTS OF THE COMPANY. The Company covenants
with the Initial Purchasers as follows:
(a) To prepare the Offering Memorandum in a form approved by the
Initial Purchasers and to furnish to the Initial Purchasers, without
charge, as many copies of the Preliminary Offering Memorandum and the
Offering Memorandum and any supplements and amendments thereto as the
Initial Purchasers may reasonably request.
(b) If, at any time prior to completion of the initial resales of the
Senior Notes by the Initial Purchasers to purchasers, any event shall occur
or condition exist as a result of which it is necessary, in the opinion of
Xxxxx Xxxxxxxxxx LLP, to amend or supplement the Offering Memorandum in
order that the Offering Memorandum will not include an untrue statement of
a material fact or omit to state a material fact necessary in order to make
the statements therein not misleading in ight of the circumstances
existing at the time it is delivered to a purchaser or a potential
purchaser, or if it is necessary to amend or supplement the Offering
Memorandum to comply with applicable law, to promptly prepare such
amendment or supplement as may be necessary to correct such untrue
statement or omission or so that the Offering Memorandum, as so amended or
supplemented, will comply with applicable law and to furnish the Initial
Purchasers such number of copies as they may reasonably request.
(c) So long as the Senior Notes are outstanding and are "restricted
securities" within the meaning of Rule 144(a)(3) under the Securities Act,
to furnish to holders of Senior Notes and prospective purchasers of Senior
Notes designated by such holders, upon request of such holders or such
prospective purchasers, the information required to be delivered pursuant
to Rule 144A(d)(4) under the Securities Act, unless such information is
contained, at the time of such request, in documents filed with the
Commission pursuant to Section 13 or 15(d) of the Exchange Act.
(d) The Company will endeavor, in ooperation with the Initial
Purchasers, to qualify the Senior Notes for offering and sale under the
applicable securities laws of such states and the other jurisdictions of
the United States as the Initial Purchasers may designate and to pay filing
fees, reasonable attorneys' fees and disbursements in connection therewith
in an amount not exceeding $15,000 in the aggregate (including filing fees
and disbursements paid or incurred prior to the date this Agreement becomes
effective); provided, however, that the Company shall not be obligated to
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qualify as a foreign corporation in any jurisdiction in which it is not
so qualified or to file a consent to service of process or to file annual
reports or to comply with any other equirements in connection with such
qualification deemed by the Company to be unduly burdensome.
(e) The Company covenants (i) not to solicit any offer to buy or offer
to sell the Senior Notes by means of any form of general solicitation or
general advertising (as those terms are used in Regulation D under the
Securities Act) or in any manner involving a public offering within the
meaning of Section 4(2) of the Securities Act and (ii) not to engage, or
permit its Affiliates or any person acting on their behalf to engage, in
any directed selling efforts (as defined in Regulation S) with respect to
the Senior Notes sold pursuant to Regulation S and to comply and cause its
Affiliates and each person acting on their behalf to comply with the
offering restrictions of Regulation S with respect to those Senior Notes
sold pursuant thereto (it being understood that the Company and its
Affiliates shall not have responsibility for the actions of the Initial
Purchasers or any of their respective affiliates).
(f) The Company covenants not to offer, sell, contract to sell or
otherwise dispose of any additional securities of the Company or to issue
any securities convertible into or exchangeable for the Senior Notes or
with respect to any debt securities substantially similar to the Senior
Notes (except for the securities issued pursuant to this Agreement),
without the consent (which consent shall not be unreasonably withheld) of
the Initial Purchasers during the period beginning from the date of this
Agreement and continuing to and including the earlier of (i) the
termination of trading restrictions on the Senior Notes, as communicated to
the Company by the Initial Purchasers and (ii) 15 days following the
Closing Date.
(g) The Company agrees not to, and will cause its Affiliates not to,
sell, offer for sale or solicit offers to buy or otherwise negotiate in
respect of any security (as defined in the Securities Act) in a transaction
that could be integrated with the sale of the Senior Notes in a manner that
would require the registration under the Securities Act of the Senior
Notes.
(h) During the period of two years after the Closing Date, the Company
will not, and will not permit any of its Affiliates to, purchase, agree to
purchase or otherwise acquire any of the Senior Notes which constitute
"restricted securities" under Rule 144 under the Securities Act.
SECTION 4. PAYMENT OF EXPENSES.
(a) The Company agrees to pay all expenses incidental to the
performance of its obligations under this Agreement, including, but not
limited to, the expenses of (i) the preparation and printing of the
Preliminary Offering Memorandum and the Offering Memorandum and any
amendments and supplements thereto, (ii) distributing the Preliminary
Offering Memorandum and the Offering Memorandum and any amendments or
supplements thereto, (iii) the preparation, issuance and delivery of the
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certificate(s) for the Senior Notes to the Initial Purchasers, (iv) the
fees and disbursements of the Company's counsel and accountants, (v) the
qualification of the Senior Notes under securities laws in accordance with
the provisions of Section 3(d) hereof including filing fees and the
reasonable fees and disbursements of Xxxxx Xxxxxxxxxx LLP, counsel for the
Initial Purchasers, in connection therewith and in connection with the
preparation of any blue sky survey, (vi) the printing and delivery to the
Initial Purchasers of copies of any blue sky survey, (vii) the fee of the
National Association of Securities Dealers, Inc. in connection with its
review of the offering contemplated by this Agreement, if applicable,
(viii) the fees and expenses of the Trustee, including the fees and
disbursements of counsel for the Trustee in connection with the Indenture
and the Notes, (ix) any fees payable in connection with the rating of the
Senior Notes, (x) the cost and charges of any transfer agent or registrar,
(xi) the cost of qualifying the Senior Notes with DTC; and (xii) all
reasonable fees, disbursements and expenses of independent engineers,
independent market experts and any other third party consultants who have
prepared reports, attached as annexes to the Preliminary Offering
Memorandum and Offering Memorandum, or otherwise.
(b) In addition, the Company agrees to pay the reasonable and
documented third party outof pocket expenses incurred by the
Representatives in connection with the offer and sale of the Senior Notes
to the Initial Purchasers (including (i) all out of pocket expenses
incurred by the Initial Purchasers with respect to the "road show"
including expenses relating to slide production, Bloomberg taping and
travel and (ii) reasonable and documented fees and expenses of counsel to
the Initial Purchasers).
SECTION 5. CONDITIONS OF INITIAL PURCHASERS' OBLIGATIONS.
The obligations of the Initial Purchasers to purchase and pay for the Senior
Notes are subject to the following conditions:
(a) Any required order or orders of the Commission under the Holding
Company Act permitting the transactions contemplated hereby substantially
in accordance with the terms and conditions hereof shall be in full force
and effect and shall contain no provision unacceptable to the Initial
Purchasers or the Company (but all provisions of such order or orders
heretofore entered, copies of which have heretofore been delivered to the
Representatives, are deemed acceptable to the Initial Purchasers and the
Company and all provisions of such order or orders hereafter entered shall
be deemed acceptable to the Initial Purchasers and the Company unless
within 24 hours after receiving a copy of any such order any party to this
Agreement shall give notice to the other parties to the effect that such
order contains an unacceptable provision).
(b) On the Closing Date the Representatives shall have received:
(1) The opinion, dated the Closing Date, of Xxxxx & Xxxxxxx LLP,
counsel for the Company, substantially in the form attached hereto as
Schedule II.
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(2) The opinion, dated the Closing Date, of Pillsbury Winthrop
LLP, counsel to the Trustee, substantially in the form attached hereto
as Schedule III.
(3) The opinion, dated as of the Closing Date, of Xxxxx
Xxxxxxxxxx LLP, counsel for the Initial Purchasers, substantially in
the form attached hereto as Schedule IV.
(4) At the Closing Date, there shall not have been, since the
date hereof or since the respective dates as of which information is
given in the Offering Memorandum, any material adverse change in the
business, properties or financial condition of the Company, whether or
not arising in the ordinary course of business, and the
Representatives shall have received a certificate of the President or
any Vice President of the Company, dated as of the Closing Date, to
the effect that (i) there has been no such material adverse change,
(ii) the representations and warranties in Section 1 hereof are true
and correct with the same force and effect as though expressly made at
and as of the Closing Date and (iii) the Company has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied on or prior to the Closing Date.
(5) On the Closing Date, the Representatives shall have received
from Deloitte & Touche LLP a letter dated as of the Closing Date to
the effect that: (A) they are independent public accountants with
respect to the Company within the meaning of the Securities Act and
the rules and regulations under the Securities Act; (B) in their
opinion, the financial statements audited by them and included in the
Offering Memorandum comply as to form in all material respects with
the applicable accounting requirements of the Exchange Act and the
rules and regulations under the Exchange Act; and (C) on the basis of
certain limited procedures performed through a specified date not more
than five business days prior to the date of such letter, namely (i)
reading the minute books of the Company; (ii) performing the
procedures specified by the American Institute of Certified Public
Accountants ("AICPA") for a review of interim financial information as
described in Statement on Auditing Standards No. 71, "Interim
Financial Information", on the unaudited financial statements, if any,
of the Company included in the Offering Memorandum and of the latest
available unaudited financial statements of the Company, if any, for
any calendar quarter subsequent to the date of those included in the
Offering Memorandum; and (iii) making inquiries of certain officials
of the Company who have responsibility for financial and accounting
matters regarding such unaudited financial statements or any specified
unaudited amounts derived therefrom (it being understood that the
foregoing rocedures do not constitute an audit performed in
accordance with generally accepted auditing standards and they would
not necessarily reveal matters of significance with respect to the
comments made in such letter, and accordingly that Deloitte & Touche
LLP make no representations as to the sufficiency of such procedures
for the Initial Purchasers' purposes), nothing came to their attention
that caused them to believe that: (1) any material modifications
should be made to the unaudited condensed financial statements
included in the Offering Memorandum for them to be in conformity with
12
generally accepted accounting principles; (2) such unaudited condensed
financial statements do not comply as to form in all material respects
with the applicable accounting requirements of the Exchange Act as it
applies to Form 10-Q and the related published rules and regulations
thereunder; (3) the unaudited amounts for Operating Revenues, Earnings
Before Interest and Income Taxes and Net Income and the unaudited
Ratio of Earnings to Fixed Charges set forth in the Offering
Memorandum do not agree with the amounts set forth in or derived from
the unaudited financial statements for the same period or were not
determined on a basis substantially consistent with that of the
corresponding audited amounts or ratios included in the Offering
Memorandum; (4) as of a specified date not more than five business
days prior to the date of delivery of such letter, there has been any
change in the capital stock or long-term debt of the Company or any
decrease in net assets as compared with amounts shown in the latest
audited balance sheet, except in each case for changes or decreases
which (i) the Offering Memorandum discloses have occurred or may
occur, (ii) are occasioned by the declaration of dividends, (iii) are
occasioned by draw-downs under existing pollution control financing
arrangements, (iv) are occasioned by draw-downs and regularly
scheduled payments of capitalized lease obligations, (v) are
occasioned by the purchase or redemption of bonds or stock to satisfy
mandatory or optional redemption provisions relating thereto, or (vi)
are disclosed in such letter; and (5) the unaudited amounts for
Operating Revenues, Earnings Before Interest and Income Taxes and Net
Income and the unaudited Ratio of Earnings to Fixed Charges for any
calendar quarter subsequent to those set forth in (3) above, which, if
available, shall be set forth in such letter, do not agree with the
amounts set forth in or derived from he unaudited financial
statements for the same period or were not determined on a basis
substantially consistent with that of the corresponding audited
amounts or ratios included in the Offering Memorandum. Deloitte &
Touche LLP shall also have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other financial
information contained in the Offering Memorandum, (in each case to the
extent that such dollar amounts, percentages and other financial
information are derived from the general accounting records of the
Company and its subsidiaries subject to the internal controls of the
Issuer's accounting system or are derived directly from such records
by analysis or computation) with the results obtained from inquiries,
a reading of such general accounting records and other procedures
specified in such letter and have found such dollar amounts,
percentages and other financial information to be in agreement with
such results, except as otherwise specified in such letter.
(6) On the Closing Date, Xxxxx Xxxxxxxxxx LLP, counsel for the
Initial Purchasers shall have been furnished with such documents and
opinions as they may reasonably equire for the purpose of enabling
them to pass upon the issuance and sale of the Senior Notes as herein
contemplated and related proceedings, or in order to evidence the
accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Company in connection with the issuance and
sale of the Senior Notes as herein contemplated shall be satisfactory
in form and substance to the Representatives and Xxxxx Xxxxxxxxxx LLP,
counsel for the Initial Purchasers.
13
(7) That no amendment or supplement to the Preliminary Offering
Memorandum or the Offering Memorandum shall be unsatisfactory in form
to Xxxxx Xxxxxxxxxx LLP or shall contain information (other than with
respect to an amendment or supplement relating solely to the activity
of the Initial Purchasers) which, in the reasonable judgment of the
Representatives, shall materially impair the marketability of the
Senior Notes.
(8) Xxxx shall have consented to the references to it in the
Offering Memorandum and the use of the Independent Engineer's Report
prepared by Xxxx and contained in Annex A to the Offering Memorandum;
and confirmed that nothing has come to their attention in connection
with the preparation of the Independent Engineer's Report which would
cause it to believe that the Independent Engineer's Report, as of its
date, or any statements in the Offering Memorandum specifically
attributed to it, as of the date of the Offering Memorandum, were
inaccurate or misleading in any material respect, as evidenced by a
certificate satisfactory to the Initial Purchasers of an authorized
officer of Xxxx, delivered and dated as of the Closing Date.
(9) PA Consulting Services, Inc. ("PA") shall have consented to
the references to it in the Offering Memorandum and the use of the
Independent Market Expert's Report prepared by PA and contained in
Annex B to the Offering Memorandum; and since the date of the
Independent Market Expert's Report, no event affecting the Report or
the matters referred to therein shall have occurred (i) which shall
make untrue or incorrect in any material respect, as of the date of
this Agreement, any information or statement contained in the
Independent Market Expert's Report or in the Offering Memorandum
relating to matters referred to in the Independent Market Expert's
Report or (ii) which is not reflected in the Offering Memorandum but
should be reflected therein in order to make the statements and
information contained in the Offering Memorandum relating to matters
referred to in the Independent Market Expert's Report, in light of the
circumstances under which they were made, not misleading, as evidenced
by a certificate satisfactory to the Initial Purchasers of an
authorized officer of PA, delivered and dated as of the Closing Date.
(10) The Initial Purchasers shall have received on the Closing
Date the Registration Rights Agreement executed by theCompany and the
Representatives.
(11) The Company shall have performed its obligations when and as
provided under this Agreement.
If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Representatives by notice to the Company at any time prior to the Closing
Date, and such termination shall be without liability of any party to any other
party except as provided in Sections 4, 7 and 9(b) hereof.
14
SECTION 6. CONDITIONS OF THE OBLIGATIONS OF THE COMPANY.
The obligations of the Company shall be subject to the
conditions set forth in Section 5(a). In case such conditions shall not have
been fulfilled, this Agreement may be terminated by the Company by mailing or
delivering written notice thereof to the Representatives. Any such termination
shall be without liability of any party to any other party except as otherwise
provided in Sections 4, 7 and 9(b) hereof.
SECTION 7. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless each of the Initial
Purchasers and each person, if any, who controls any such Initial Purchaser
within the meaning of Section 15 of the Securities Act or Section 20(a) of the
Exchange Act, against any and all losses, claims, damages or liabilities, joint
or several, to which they or any of them may become subject under the Securities
Act, Exchange Act or otherwise, and to reimburse such Initial Purchaser and such
controlling person or persons, if any, for any legal or other expenses incurred
by them in connection with defending any actions, insofar as such losses,
claims, damages, liabilities or actions arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained in the
Preliminary Offering Memorandum or Offering Memorandum or, if the Company shall
furnish to the Initial Purchasers any amendments or any supplements thereto, or
arise out of or are based upon any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any such untrue
statement or alleged untrue statement or omission or alleged omission which was
made in such Preliminary Offering Memorandum or Offering Memorandum or any such
amendment or supplement thereto in reliance upon and in conformity with
information furnished in writing to the Company by, or through the
Representatives on behalf of, the Initial Purchasers for use therein and except
that this indemnity with respect to the Preliminary Offering Memorandum or with
respect to the Offering Memorandum, if the Company shall have furnished any
amendment or supplement thereto, shall not inure to the benefit of any Initial
Purchaser (or of any person controlling such Initial Purchaser) on account of
any losses, claims, damages, liabilities or actions arising from the sale of the
Senior Notes to any person if a copy of the Offering Memorandum, as the same may
then be amended or supplemented, shall not have been sent or given by or on
behalf of such Initial Purchaser to such person with or prior to the written
confirmation of the sale involved and the untrue statement or alleged untrue
statement or omission or alleged omission was corrected in the Offering
Memorandum as supplemented or amended at the time of such confirmation. Each
Initial Purchaser agrees, within ten days after the receipt by it of notice of
the commencement of any action in respect of which indemnity may be sought by
it, or by any person controlling it, from the Company on ccount of its
agreement contained in this Section 7, to notify the Company in writing of the
commencement thereof but the omission of such Initial Purchaser so to notify the
15
Company of any such action shall not release the Company from any liability
which it may have to such Initial Purchaser or to such controlling person
otherwise than on account of the indemnity agreement contained in this Section
7. In case any such action shall be brought against an Initial Purchaser or any
such person controlling such Initial Purchaser and such Initial Purchaser shall
notify the Company of the commencement thereof as above provided, the Company
shall be entitled to participate in (and, to the extent that it shall wish,
including the selection of counsel, to direct) the defense thereof, at its own
expense. In case the Company elects to direct such defense and select such
counsel, any Initial Purchaser or controlling person shall have the right to
employ its own counsel, but, in any such case, the fees and expenses of such
counsel shall be at the expense of such Initial Purchaser or such controlling
person unless the employment of such counsel has been authorized in writing by
the Company in connection with defending such action. No indemnifying party
shall, without the written consent of the indemnified party, effect the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification may be sought hereunder (whether or not the indemnified party is
an actual or potential party to such action or claim) unless such settlement,
compromise or judgment (i) includes an unconditional release of the indemnified
party from all liability arising out of such action or claim and (ii) does not
include any statement as to, or an admission of, fault, culpability or a failure
to act, by or on behalf of any indemnified party. In no event shall any
indemnifying party have any liability or responsibility in respect of the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim effected without its prior
written consent.
(b) Each Initial Purchaser agrees severally and not jointly, to indemnify
and hold harmless the Company and each of its directors and officers and each
person, if any, who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Exchange Act to the same extent and upon
the same terms as the indemnity agreement of the Company set forth in Section
7(a) hereof, but only with respect to alleged untrue statements or omissions
made in the Preliminary Offering Memorandum or the Offering Memorandum, or such
documents as amended or supplemented, in reliance upon and in conformity with
information furnished in writing to the Company by, or through the
Representatives on behalf of, such Initial Purchaser for use therein.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY.
All representations, warranties and agreements contained in
this Agreement, or contained in certificates of officers of the Company
submitted pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Initial Purchaser or
controlling person, or by, or on behalf of the Company and shall survive
delivery of the Senior Notes to the Initial Purchasers.
16
SECTION 9. TERMINATION OF AGREEMENT.
(a) The Representatives may terminate this Agreement, by
notice to the Company, at any time at or prior to the Closing Date if (i)
trading in securities on the New York Stock Exchange shall have been generally
suspended or there shall have been a material disruption in settlement in
securities generally, (ii) minimum or maximum ranges for prices shall have been
generally established on the New York Stock Exchange by the Commission or by
the New York Stock Exchange, (iii) a general banking moratorium shall have
been declared by federal or New York State authorities, or (iv) there shall
have occurred any outbreak or escalation of major hostilities in which the
United States is involved, any declaration of war by the United States Congress
or any other substantial national or international calamity or emergency
(including, without limitation, acts of terrorism) affecting the United States,
in any such case provided for in clauses (i) through (iv) with the result that,
in the reasonable judgement of the Representatives, th marketability of the
Senior Notes shall have been materially impaired.
(b) If this Agreement shall be terminated by the
Representatives pursuant to subsection (a) above or because of any failure or
refusal on the part of the Company to comply with the terms or to fulfill any of
the conditions of this Agreement, or if for any reason the Company shall be
unable to perform its obligations under this Agreement, then in any such case,
the Company will reimburse the Initial Purchasers for the reasonable and
documented third party out of pocket expenses described in Section 4(b) of this
Agreement. Upon such reimbursement, the Company shall be absolved from any
further liability hereunder, except as provided in Sections 4(a) and 7.
SECTION 10. DEFAULT BY AN INITIAL PURCHASER
If an Initial Purchaser shall fail on the Closing Date to
purchase the Senior Notes that it is obligated to purchase under this Agreement
(the "Defaulted Securities"), the Representatives shall have the right, within
24 hours thereafter, to make arrangements for the non-defaulting Initial
Purchasers, or any other initial purchasers, to purchase all, but not less than
all, of the Defaulted Securities in such amounts as may be agreed upon and upon
the terms herein set forth. If, however, the Representatives shall not have
completed such arrangements within such 24-hour period, then:
(a) if the principal amount of Defaulted Securities does not
exceed 10% of the Senior Notes, the non-defaulting Initial Purchasers shall be
obligated, severally and not jointly, to purchase the full amount thereof in
the proportions that their respective underwriting obligations hereunder bear
to the underwriting obligations of all non-defaulting Initial Purchasers, or
(b) if the principal amount of Defaulted Securities exceeds
10% of the Senior Notes, this Agreement shall terminate without liability on
the part of any non-defaulting Initial Purchaser.
17
No action taken pursuant to this Section shall relieve any
defaulting Initial Purchaser from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement, either the Representatives or the Company shall
have the right to postpone the Closing Date for a period not exceeding seven
days in order to effect any required changes in the Offering Memorandum or in
any other documents or arrangements.
SECTION 11. NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
mailed or transmitted by any standard form of telecommunication. Notices to
the Initial Purchasers shall be directed to the Representatives at Xxxxxx
Brothers Inc., 000 0xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Debt
Capital Markets, Power Group, Fax: 000-000-0000 and Xxxxxxx Xxxxx Barney
Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx Xxxxxx,
Fax: 000-000-0000; notices to the Company shall be mailed to 000 Xxxxxxxxx
Xxxxxx, X.X., Xxxxxxx, Xxxxxxx 00000, Attention: Treasurer, with a copy to
Southern Company Services, Inc., 000 Xxxxxxxxx Xxxxxx, X.X., Xxxxxxx, Xxxxxxx
00000, Attention: Xxxxxxxxxxx X. Xxxxx.
SECTION 12. PARTIES. This Agreement shall inure to the
benefit of and be binding upon the Initial Purchasers, the Company and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Initial Purchasers and the Company and their respective successors and
the controlling persons and officers and directors referred to in Section 7 and
their heirs and legal representatives, any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision herein contained.
This Agreement and all conditions and provisions hereof are intended to be for
the sole and exclusive benefit of the Initial Purchasers and the Company and
their respective successors, and said controlling persons and officers and
directors and their heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Senior Notes from any of the
Initial Purchasers shall be deemed to be a successor by reason merely of such
purchase.
SECTION 13. GOVERNING LAW AND TIME. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York
applicable to agreements made and to be performed in said State. Except as
otherwise set forth herein, specified times of day refer to New York City time.
SECTION 14. COUNTERPARTS. This Agreement may be executed by
any one or more of the parties hereto in any number of counterparts, each of
which shall be deemed to be an original, but all such respective
counterparts shall together constitute one and the same instrument.
18
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement between the Initial Purchasers and the Company in accordance with its
terms.
Very truly yours,
SOUTHERN POWER COMPANY
By:
------------------------------------
Name:
-----------------------------
Title:
----------------------------
CONFIRMED AND ACCEPTED,
as of the date first above written
XXXXXX BROTHERS INC.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
XXXXXXX XXXXX BARNEY INC.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
As Representatives of the Several Initial Purchasers
named in Schedule I hereto
SCHEDULE I
I. Purchase Price
The purchase prices to be paid by the Initial Purchasers for the Senior
Notes shall be as follows:
Initial Purchasers' Initial Purchasers'
Price to Public Discount Purchase Price
-------------------- ----------------- -----------------
99.859% 0.650% 99.209%
------------------------------------------------------------------------------
II. Principal Amount to be Purchased
---------------------------------------------------- Principal Amount of
Initial Purchasers Senior Notes
Xxxxxx Brothers Inc............................... 201,250,000
Xxxxxxx Xxxxx Barney Inc.......................... 201,250,000
Barclays Capital Inc.............................. 28,750,000
Commerzbank Capital Markets Corp.................. 28,750,000
Mizuho International plc.......................... 28,750,000
Xxxxxx Xxxxxxx & Co. Incorporated................. 28,750,000
Scotia Capital (USA) Inc.......................... 28,750,000
Tokyo-Mitsubishi International plc................ 28,750,000
-------------
Aggregate Principal Amount $575,000,000
Schedule II
[Letterhead of XXXXX & XXXXXXX LLP]
________, 2002
Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxxx Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
As Representatives of the Several Initial Purchasers
SOUTHERN POWER COMPANY
___ % Senior Notes, Series A due _________ 2012
Ladies and Gentlemen:
We have acted as general counsel to Southern Power Company
(the "Company") in connection with (i) the Company's issuance of $__________
aggregate principal amount of its ___% Senior Notes, Series A due _______ 2012
(the "Notes") pursuant to a Senior Note Indenture dated as of June 1, 2002, by
and between the Company and The Bank of New York, as trustee (the "Trustee"), as
heretofore supplemented and as further supplemented by the First Supplemental
Indenture dated as of __________, 2002 (collectively, the "Indenture"); and (ii)
the purchase by the Representatives of the Notes pursuant to the terms of a
Purchase Agreement dated June __, 2002, among the Company and the initial
purchasers named in Schedule I thereto (the "Initial Purchasers") for whom you
are acting as the Representatives (the "Purchase Agreement"). The Notes are
subject to the Registration Rights Agreement dated the date hereof by and among
the Company and you (the "Registration Rights Agreement"). This opinion is being
delivered to you as Representatives pursuant to Section 5(b)(1) thereof.
All capitalized terms not otherwise defined herein shall have
the meanings set forth in the Purchase Agreement.
In rendering the opinions expressed below, we have examined
the offering memorandum dated __________, 2002 (the "Offering Memorandum"), the
Indenture, the Notes, the Registration Rights Agreement and the Purchase
Agreement.
In addition, we have examined, and have relied as to matters
of fact upon, the documents delivered to you at the closing (except the Notes,
of which we have examined specimens), and we have made such other and further
investigations as we deemed necessary to express the opinions hereinafter set
forth. In such examination, we have assumed the genuineness of all signatures,
the legal capacity of natural persons, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified or photostatic copies, and the
authenticity of the originals of such latter documents.
The Indenture, the Registration Rights Agreement, the Notes
and the Purchase Agreement are herein referred to as the "Agreements".
Based upon the foregoing, and subject to the qualifications
and limitations stated herein, we are of the opinion, relying as to matters of
New York law upon the opinion dated the date hereof rendered to you by Xxxxx
Xxxxxxxxxx LLP, that:
1. The Company has been duly organized and is validly
existing and in good standing as a corporation under the laws of the State of
Delaware and has due corporate authority to conduct it business and to own and
operate the properties used by it in such business as described in the Offering
Memorandum and to enter into and perform its obligations under the Agreements
and the Notes.
2. The execution, delivery and performance by the Company
of the Purchase Agreement have been duly authorized by all necessary corporate
action, and the Purchase Agreement has been duly executed and delivered by the
Company.
3. All orders, consents, or other authorizations or
approvals of the Commission legally required under the Public Utility Holding
Company Act of 1935, as amended, for the issuance and delivery of the Notes
have been obtained; such orders are sufficient for the issuance and the
delivery of the Notes; the issuance and the delivery of the Notes conform in all
material respects with the terms of such orders; and no other order, consent or
other authorization or approval of the States of Delaware, Georgia, Florida,
Alabama or United States governmental body (other than in connection or in
compliance with the provisions of the securities or "blue sky" laws of any
jurisdiction, as to which we express no opinion) is legally required for the
issuance and delivery of the Notes in accordance with the terms of the Purchase
Agreement.
4. The Indenture has been duly authorized, executed and
delivered by the Company and, assuming the due authorization, execution and
delivery thereof by the Trustee constitutes a valid and legally binding
instrument of the Company, enforceable against the Company in accordance with
its terms, subject to the qualifications that the enforceability of the
Company's obligations under the Indenture may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar laws relating to or
affecting ceditors' rights generally and by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law); and the Indenture conforms as to legal matters in all
material respects to the description thereof in the Offering Memorandum.
2
5. The Notes have been duly authorized and executed by the
Company and, when authenticated by the Trustee in the manner provided in the
Indenture and delivered to and paid for by the Initial Purchasers pursuant to
Agreement, will constitute valid and binding obligations of the Company,
the Purchase enforceable against the Company in accordance with their terms,
subject to the qualifications that the enforceability of the Company's
obligations under the Notes may be limited by bankruptcy, insolvency,
reorganization, moratorium andother similar laws relating to or affecting
creditors' rights generally and by general principles of equity; nd the Notes
conform as to legal matters in allmaterial respects to the description thereof
in the Offering Memorandum.
6. The Registration Rights Agreement has been duly
authorized, executed and delivered by the Company and, assuming the due
authorization, execution and delivery thereof by the other parties thereto,
constitutes a valid and legally binding instrument of the Company, enforceable
against the Company in accordance with its terms, except to the extent that the
enforceability of the Company's obligations under the Registration Rights
Agreement may be limited by bankruptcy, insolvency, reorganization, moratorium
and other similar laws relating to or affecting creditors' rights generally and
by general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and except to the extent
indemnification or contribution provisions thereunder may be limited under
applicable law; the Registration Rights Agreement conforms in all material
respects to all statements relating thereto in the Offering Memorandum.
7. The statements as to matters of law and legal conclusions
contained in the Offering Memorandum under the caption "Certain U.S. Federal
Income Tax Considerations" are correct in all material respects.
8. Assuming (a) the accuracy of the representations and
warranties of the Company set forth in Section 1 of the Purchase Agreement and
of the Initial Purchasers set forth in Section 2 of the Purchase Agreement, (b)
the due performance by the Company of the covenants and agreements set forth in
Section 3 of the Purchase Agreement and the due performance by the Initial
Purchasers of the covenants and agreements set forth in Section 2 of the
Purchase Agreement, (c) compliance by the Initial Purchasers with the offering
and transfer procedures and restrictions described in the Offering Memorandum
and (d) the accuracy of the representations and warranties made in accordance
with the Offering Memorandum by purchasers to whom the Initial Purchasers
initially resells the Notes, the offer, sale and delivery of the Notes to the
Initial Purchasers in the manner contemplated by the Purchase Agreement and the
Offering Memorandum and the initial resale of the Notes by the Initial
Purchasers in the manner contemplated in the Offering Memorandum and the
Purchase Agreement do not require registration of the Notes under the
Securities Act (it being understood that we express no opinion as to any
subsequent resale of any Notes) and the Indenture is not required to be
qualified under the Trust Indenture Act.
9. The execution, delivery and performance by the Company of
the Agreement does not and will not result in any violation of the Certificate
of Incorporation or the By-Laws of the Company, and do not and will not conflict
3
with, or result in a breach of any of the terms or provisions of, or constitute
a default under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company under (A) any material
contract, indenture, mortgage, loan agreement, note, lease or any other
agreement or instrument known to us to which the Company is a party or by which
it may be bound or to which any of its properties may be subject (except for
such conflicts, breaches or defaults or liens, charges or encumbrances that
would not have a material adverse effect on the condition (financial or
otherwise) of the Company), (B) any existing applicable law, rule or regulation
applicable to the Company (other than the securities or blue sky laws of any
jurisdiction, as to which we express no opinion) or (C) any judgment, order or
decree known to us of any government, governmental instrumentality, or court,
domestic or foreign, or any regulatory body or administrative agency or other
governmental body having jurisdiction over the Company.
10. The Company is not, nor after giving effect to the sale
of the Notes will be, an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
We have not independently verified the accuracy, completeness
or fairness of the statements made or included in the Offering Memorandum and
take no responsibility therefor, except as and to the extent set forth in
paragraphs 4, 5, 6 and 7 above. In the course of the preparation by the Company
of the Offering Memorandum, we participated in conferences with certain officers
and employees of the Company, with representatives of Deloitte & Touche LLP and
with your counsel. Based upon our examination of the Offering Memorandum, our
investigations made in connection with the preparation of the Offering
Memorandum and our participation in the conferences referred to above, nothing
came to our attention which gives us reason to believe that the Offering
Memorandum, as of its date, contained, or on the date hereof contains, any
untrue statement of a material fact or omitted as of its date or omits as of the
date hereof to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading, except that in
each case we express no opinion or belief with respect to (i) the financial
statements or other financial or statistical data contained in the Offering
Memorandum or (ii) the Independent Engineer's Report or the Independent Market
Expert's Report attached as Annex A and B, respectively, to the Offering
Memorandum.
We are members of the State Bar of Alabama and we do not
express any opinion herein concerning any law other than the laws of such State
and, to the extent set forth herein, the law of the States of New York, Georgia,
Florida, Delaware General Corporation Law and the federal law of the United
States.
4
This opinion is rendered to you in connection with the
above-described transaction. This opinion may not be relied upon by you for any
other purpose, or relied upon by or furnished to any other person without our
prior written consent.
Yours very truly,
XXXXX & XXXXXXX LLP
[Note: With respect to matters involving the laws of the States of Florida and
Georgia, Xxxxx & Xxxxxxx LLP shall be permitted to rely on opinions addressed to
it from Florida counsel and Georgia counsel.]
5
Schedule III
[Letterhead of PILLSBURY WINTHROP LLP]
__________, 2002
Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxxx Xxxxx Barney Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
As Representatives of the Several Initial Purchasers
Southern Power Company
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Southern Power Company
___% Senior Notes, Series A due 20__
Ladies and Gentlemen:
We have acted as counsel to The Bank of New York (the "Bank")
in connection with (a) the Senior Note Indenture, dated as of June 1, 2002 (the
"Original Indenture"), between Southern Power Company (the "Company") and the
Bank, as Trustee and (b) the First Supplemental Indenture dated as of June __,
2000 (together with the Original Indenture, herein called the "Indenture"),
between the Company and the Bank, as Trustee.
In that connection, we have examined originals, or copies
certified or otherwise identified to our satisfaction, of such documents,
records and other instruments as we have deemed necessary or appropriate for the
purpose of this opinion, including copies of the Indenture and certain
resolutions adopted by the Board of Directors of the Bank.
Based upon the foregoing, we are of the opinion that:
i) the Bank has been duly incorporated and is validly
existing as a banking corporation in good standing under the laws of the State
of New York; and
ii) the Bank has the corporate trust power and authority
to execute, deliver and perform its duties under the Indenture, has duly
executed and delivered the Indenture, and, insofar as the laws governing the
trust powers of the Bank are concerned and assuming due authorization,
execution and delivery thereof by the Company, the Indenture constitutes a
legal, valid and binding agreement of the Bank, enforceable against the Bank in
accordance with its terms subject to applicable bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium or other laws affecting
creditors' rights generally from time to time in effect and to general
principles of equity (including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing), regardless of whether considered
in a proceeding in equity or at law.
We are admitted to practice only in the State of New York, and
we express no opinion as to matters governed by any laws other than the laws of
the State of New York and the Federal law of the United States of America. We
are furnishing this opinion to you solely for your benefit. This opinion is not
to be relied upon by any other person or used, circulated, quoted or otherwise
referred to for any other purpose.
Very truly yours,
--------------------------
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Schedule IV
[Letterhead of XXXXX XXXXXXXXXX LLP]
_____, 2002
Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxxx Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
As Representatives of the Several Initial Purchasers
SOUTHERN POWER COMPANY
___% Senior Notes, Series A due 20__
Ladies and Gentlemen:
We have represented you in connection with (i) the issuance by
Southern Power Company (the "Company") of $__________ of its ___% Senior Notes,
Series A due 20__ (the "Notes") pursuant to a Senior Note Indenture dated as of
June 1, 2002, by and between the Company and The Bank of New York, as trustee
(the "Trustee"), as heretofore supplemented and as further supplemented by the
First Supplemental Indenture dated as of June __, 2002 (collectively, the
"Indenture"); and (ii) the purchase by you of the Notes pursuant to the terms of
a Purchase Agreement dated June ___, 2002, among the Company and the initial
purchasers named in Schedule I thereto (the "Initial Purchasers") for whom you
are acting as Representatives (the "Purchase Agreement"). The Notes are subject
to the Registration Rights Agreement dated the date hereof by and among the
Company and you (the "Registration Rights Agreement"). This opinion is being
delivered to you as Representatives pursuant to Section 5(c)(4) thereof.
All capitalized terms not otherwise defined herein shall have
the meanings set forth in the Purchase Agreement.
In rendering the opinions expressed below, we have examined
the Offering Memorandum dated _________, 2002 (the "Offering Memorandum"), the
Indenture, the Notes, the Registration Rights Agreement and the Purchase
Agreement.
In addition, we have examined, and have relied as to matters
of fact upon, the documents delivered to you at the closing (except the Notes,
of which we have examined specimens), and we have made such other and further
investigations as we deemed necessary to express the opinions hereinafter set
forth. In such examination, we have assumed the genuineness of all signatures,
the legal capacity of natural persons, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified or photostatic copies, and the
authenticity of the originals of such latter documents.
The Indenture, the Registration Rights Agreement, the Notes
and the Purchase Agreement are herein referred to as the "Agreements".
Based upon the foregoing, and subject to the qualifications
and limitations stated herein, we are of the opinion:
1. The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware and has due corporate authority to conduct its business and to own and
operate the properties used by it in such business as described in the Offering
Memorandum and to enter into and perform its obligations under the Agreements
and the Notes.
2. The execution, delivery and performance by the Company of
the Purchase Agreement have been duly authorized by all necessary corporate
action, and the Purchase Agreement has been duly executed and delivered by the
Company.
3. All orders, consents, or other authorizations or approvals
of the Commission legally required under the Public Utility Holding Company Act
of 1935, as amended, for the issuance and delivery of the Notes have been
obtained; such orders are sufficient for the issuance and delivery of the
Notes; the issuance and delivery of the Notes conform in all material respects
with the terms of such orders; and no other order, consent or other
authorization or approval of the State of New York or United States governmental
body (other than in connection or in compliance with the provisions of the
securities or "blue sky" laws of any jurisdiction, as to which we express no
opinion) is legally required for the issuance and delivery of the Notes in
accordance with the terms of the Purchase Agreement.
4. The Indenture has been duly authorized, executed and
delivered by the Company and, assuming the due authorization, execution and
delivery thereof by the Trustee constitutes a valid and legally binding
instrument of the Company, enforceable against the Company in accordance with
its terms, subject to the qualifications that the enforceability of the
Company's obligations under the Indenture may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law); and the Indenture conforms as to legal matters in all
material respects to the description thereof in the Offering Memorandum.
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5. The Notes have been duly authorized and executed by the
Company and, when authenticated by the Trustee in the manner provided in the
Indenture and delivered to and paid for by the Initial Purchasers pursuant to
the Purchase Agreement, will constitute valid and binding obligations of the
Company enforceable against the Company in accordance with their terms, subject
to the qualifications that the enforceability of the Company's obligations
under the Notes may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law); and the
Notes conform as to legal matters in all material respects to the description
thereof in the Offering Memorandum.
6. The Registration Rights Agreement has been duly authorized,
executed and delivered by theCompany and, assuming the due authorization,
execution and delivery thereof by the other parties thereto, constitutes a
valid and legally binding instrument of the Company, enforceable against the
Company in accordance with its terms, except to the extent that the
enforceability of the Company's obligations under the Registration Rights
Agreement may be limited by bankruptcy, insolvency, reorganization, moratorium
and other similar laws relating to or affecting creditors' rights generally and
by general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and except to the extent
indemnification or contribution provisions thereunder may be limited under
applicable law; the Registration Rights Agreement conforms in all material
respects to all statements relating thereto in the Offering Memorandum.
7. Assuming (a) the accuracy of the representations and
warranties of the Company set forth in Section 1 of the Purchase Agreement and
of the Initial Purchasers set forth in Section 2 of the Purchase Agreement, (b)
the due performance by the Company of the covenants and agreements set forth in
Section 3 of the Purchase Agreement and the due performance by the Initial
Purchasers of the covenants and agreements set forth in Section 2 of the
Purchase Agreement, (c) compliance by the Initial Purchasers with the offering
and transfer procedures and restrictions described in the Offering Memorandum
and (d) the accuracy of the representations and warranties made in accordance
with the Offering Memorandum by purchasers to whom the Initial Purchasers
initially resells the Notes, the offer, sale and delivery of the Notes to the
Initial Purchasers in the manner contemplated by the Purchase Agreement and the
Offering Memorandum and the initial resale of the Notes by the Initial
Purchasers in the manner contemplated in the Offering Memorandum and the
Purchase Agreement do not require registration of the Notes under the
Securities Act (it being understood that we express no opinion as to any
subsequent resale of any Notes) and the Indenture is not required to be
qualified under the Trust Indenture Act.
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We have not independently verified the accuracy, completeness
or fairness of the statements made or included in the Offering Memorandum and
take no responsibility therefor, except as and to the extent set forth in
paragraphs 4, 5 and 6 above. In the course of the preparation by the Company of
the Offering Memorandum, we participated in conferences with certain officers
and employees of the Company, with representatives of Deloitte & Touche LLP and
with your counsel. Based upon our examination of the Offering Memorandum, our
investigations made in connection with the preparation of the Offering
Memorandum and our participation in the conferences referred to above, nothing
came to our attention which gives us reason to believe that the Offering
Memorandum, as of its date, contained, or on the date hereof contains, any
untrue statement of a material fact or omitted as of its date or omits as of the
date hereof to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading, except that in
each case we express no opinion or belief with respect to (i) the financial
statements or other financial or statistical data contained in the Offering
Memorandum or (ii) the Independent Engineer's Report or the Independent Market
Expert's Report attached as Annex A and Annex B, respectively, to the Offering
Memorandum.
We are members of the State Bar of New York and we do not
express any opinion herein concerning any law other than the law of the State of
New York and the federal law of the United States and the general corporation
law of the State of Delaware.
This opinion is rendered solely to you in connection with the
above matter. This opinion may not be relied upon by you for any other purpose
or relied upon by or furnished to any other person without our prior written
consent except that Xxxxx & Xxxxxxx LLP may rely on this opinion in giving their
opinions (i) pursuant to Section 5 of the Purchase Agreement, insofar as such
opinions relate to matters of New York law, and (ii) pursuant to Sections 102,
302 and 904 of the Indenture, insofar as such opinion relates to matters of New
York law.
Very truly yours,
XXXXX XXXXXXXXXX LLP
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