Exhibit 4.8
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT ("Guarantee Agreement"), dated as of
February 1, 1999, between ALABAMA POWER COMPANY, an Alabama corporation (the
"Guarantor"), and THE CHASE MANHATTAN BANK, a New York banking corporation, as
trustee (the "Trustee"), for the benefit of the Holders (as defined herein) from
time to time of the Preferred Securities (as defined herein) of ALABAMA POWER
CAPITAL TRUST III, a Delaware statutory business trust (the "Trust").
WHEREAS, pursuant to an Amended and Restated Trust Agreement
(the "Trust Agreement"), dated as of February 1, 1999, among the Trustee, the
other Trustees named therein, Alabama Power Company, as Depositor, and the
holders of undivided beneficial interests in the assets of the Trust, the Trust
is issuing as of February 25, 1999 $50,000,000 aggregate liquidation amount of
its Capital Auction Preferred Securities (the "Preferred Securities")
representing preferred undivided beneficial interests in the assets of the Trust
and having the terms set forth in the Trust Agreement;
WHEREAS, the Preferred Securities will be issued by the Trust
and the proceeds thereof will be used to purchase the Junior Subordinated Notes
(as defined in the Trust Agreement) of the Guarantor, which will be held by the
Trust as trust assets; and
WHEREAS, as incentive for the Holders to purchase the
Preferred Securities, the Guarantor desires to irrevocably and unconditionally
agree, to the extent set forth herein, to pay to the Holders the Guarantee
Payments (as defined herein) and to make certain other payments on the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the payment for Preferred
Securities by each Holder (as defined herein) thereof, which payment the
Guarantor hereby agrees shall benefit the Guarantor, the Guarantor executes and
delivers this Guarantee Agreement for the benefit of the Holders from time to
time of the Preferred Securities.
Article I
DEFINITIONS
Section 1.01. Definitions. As used in this Guarantee Agreement, the terms set
forth below shall, unless the context otherwise requires, have the following
meanings. Capitalized or otherwise defined terms used but not otherwise defined
herein shall have the meanings assigned to such terms in the Trust Agreement as
in effect on the date hereof.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Common Securities" means the securities representing common
undivided beneficial interests in the assets of the Trust.
"Event of Default" means a failure by the Guarantor to perform
any of its payment obligations under this Guarantee Agreement.
"Guarantee Payments" shall mean the following payments or
distributions, without duplication, with respect to the Preferred Securities, to
the extent not paid or made by or on behalf of the Trust: (i) any accrued and
unpaid distributions that are required to be paid on such Preferred Securities
but if and only if and to the extent the Trust has funds legally and immediately
available therefor to make such payment; (ii) the redemption price, including
all accrued and unpaid distributions to the date of redemption (the "Redemption
Price"), with respect to the Preferred Securities called for redemption by the
Trust but if and only if and to the extent that the Trust has funds legally and
immediately available therefor sufficient to make such payment; and (iii) upon a
voluntary or involuntary dissolution, winding-up or termination of the Trust
(other than in connection with the distribution of Junior Subordinated Notes to
the holders of Trust Securities or the redemption of all of the Preferred
Securities), the lesser of (a) the aggregate of the liquidation amount and all
accrued and unpaid distributions on the Preferred Securities to the date of
payment, to the extent the Trust has funds legally and immediately available
therefor, and (b) the amount of assets of the Trust remaining available for
distribution to Holders in liquidation of the Trust (in either case, the
"Liquidation Distribution").
"Holder" shall mean any holder, as registered on the books and
records of the Trust, of any Preferred Securities; provided, however, that in
determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guarantor or any Affiliate of the Guarantor.
"Indenture" means the Subordinated Note Indenture dated as of
January 1, 1997, among the Guarantor, as Subordinated Note Issuer, and The Chase
Manhattan Bank, as trustee, as supplemented by the First Supplemental Indenture
dated as of January 1, 1997, by and between the Guarantor and The Chase
Manhattan Bank, as Trustee and the Second Supplemental Indenture dated as of
February 25, 1999 by and between the Guarantor and The Chase Manhattan Bank, as
Trustee.
"Majority in liquidation amount of Preferred Securities" means
a vote by Holder(s) of Preferred Securities, voting separately as a class, of
more than 50% of the liquidation amount of all Preferred Securities outstanding
at the time of determination.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, the President or a Vice President, and by the Treasurer,
an Assistant Treasurer, the Secretary or an Assistant Secretary, of the
Guarantor, and delivered to the Trustee. Any Officers' Certificate delivered
with respect to compliance with a condition or covenant provided for in this
Guarantee Agreement shall include:
(a) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers'
Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable
such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer, such
condition or covenant has been complied with.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Responsible Officer" means, with respect to the Trustee, any
vice president, any assistant vice president, the secretary, any assistant
secretary, the treasurer, any assistant treasurer, any senior trust officer,
trust officer or assistant trust officer or any other officer of the Corporate
Trust Department of the Trustee customarily performing functions similar to
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of that officer's knowledge of and familiarity with
the particular subject.
"Successor Trustee" means a successor Trustee possessing the
qualifications to act as Trustee under Section 4.01.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
"Trustee" means The Chase Manhattan Bank until a Successor
Trustee has been appointed and has accepted such appointment pursuant to the
terms of this Guarantee Agreement and thereafter means each such Successor
Trustee.
Article II
TRUST INDENTURE ACT
Section 2.01. Trust Indenture Act; Application.
(a) This Guarantee Agreement is subject to the provisions of the Trust Indenture
Act that are required to be part of this Guarantee Agreement and shall, to the
extent applicable, be governed by such provisions; and
(b) If and to the extent that any provision of this Guarantee Agreement limits,
qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
Section 2.02. Lists of Holders of Securities.
(a) The Guarantor shall furnish or cause to be furnished to the Trustee (a)
semiannually, not later than June 1 and December 1 in each year, a list, in such
form as the Trustee may reasonably require, of the names and addresses of the
Holders ("List of Holders") as of a date not more than 15 days prior to the time
such list is furnished, and (b) at such other times as the Trustee may request
in writing, within 30 days after the receipt by the Guarantor of any such
request, a List of Holders as of a date not more than 15 days prior to the time
such list is furnished; provided that, the Guarantor shall not be obligated to
provide such List of Holders at any time the List of Holders does not differ
from the most recent List of Holders given to the Trustee by the Guarantor. The
Trustee may destroy any List of Holders previously given to it on receipt of a
new List of Holders.
(b) The Trustee shall comply with its obligations under Sections 311(a), 311(b)
and 312(b) of the Trust Indenture Act.
Section 2.03. Reports by the Trustee. Within 60 days after May 15 of each year
commencing May 15, 1999, the Trustee shall provide to the Holders of the
Preferred Securities such reports as are required by Section 313(a) of the Trust
Indenture Act, if any, in the form and in the manner provided by Section 313 of
the Trust Indenture Act. The Trustee shall also comply with the other
requirements of Section 313 of the Trust Indenture Act.
Section 2.04. Periodic Reports to Trustee. The Guarantor shall provide to the
Trustee such documents, reports and information as required by Section 314 of
the Trust Indenture Act (if any) in the form, in the manner and at the times
required by Section 314 of the Trust Indenture Act, and shall provide, within
120 days after the end of each of its fiscal years, the compliance certificate
required by Section 314(a)(4) of the Trust Indenture Act in the form and in the
manner required by such Section.
Section 2.05. Evidence of Compliance with Conditions Precedent. The Guarantor
shall provide to the Trustee such evidence of compliance with any conditions
precedent, if any, provided for in this Guarantee Agreement that relate to any
of the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) may be given in the form of an Officers' Certificate.
Section 2.06. Events of Default; Waiver. The Holders of a Majority in
liquidation amount of Preferred Securities may, by vote, on behalf of all of the
Holders, waive any past Event of Default and its consequences. Upon such waiver,
any such Event of Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured, for every purpose of this
Guarantee Agreement, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.
Section 2.07. Event of Default; Notice.
(a) The Trustee shall, within 90 days after the occurrence of an Event of
Default, transmit by mail, first class postage prepaid, to the Holders, notices
of all Events of Default known to the Trustee, unless such defaults have been
cured before the giving of such notice, provided that the Trustee shall be
protected in withholding such notice if and so long as the board of directors,
the executive committee, or a trust committee of directors and/or Responsible
Officers of the Trustee in good faith determines that the withholding of such
notice is in the interests of the Holders.
(b) The Trustee shall not be deemed to have knowledge of any Event of Default
unless the Trustee shall have received written notice, or a Responsible Officer
charged with the administration of the Trust Agreement shall have obtained
written notice, of such Event of Default.
Section 2.08. Conflicting Interests. The Trust Agreement, the amended and
restated trust agreement dated as of January 1, 1996, among the Guarantor, as
Depositor, Chase Manhattan Bank Delaware (formerly known as Chemical Bank
Delaware), as Delaware Trustee, the Administrative Trustees named therein and
The Chase Manhattan Bank (formerly known as Chemical Bank), as Property Trustee,
relating to Alabama Power Capital Trust I, the amended and restated trust
agreement dated as of January 1, 1997, among the Guarantor, as Depositor, Chase
Manhattan Bank Delaware (formerly known as Chemical Bank Delaware), as Delaware
Trustee, the Administrative Trustees named therein and The Chase Manhattan Bank
(formerly known as Chemical Bank) as Property Trustee, relating to Alabama Power
Capital Trust II, the guarantee agreement dated as of January 1, 1996, between
the Guarantor, as guarantor, and The Chase Manhattan Bank (formerly known as
Chemical Bank), as trustee, relating to Alabama Power Capital Trust I and the
guarantee agreement dated as of January 1, 1997, between the Guarantor, as
guarantor, and The Chase Manhattan Bank (formerly known as Chemical Bank), as
trustee, relating to Alabama Power Capital Trust II shall be deemed to be
specifically described in this Guarantee Agreement for the purposes of clause
(i) of the first proviso contained in Section 310(b) of the Trust Indenture Act.
Article III
POWERS, DUTIES AND RIGHTS OF TRUSTEE
Section 3.01. Powers and Duties of the Trustee.
(a) This Guarantee Agreement shall be held by the Trustee for the benefit of the
Holders, and the Trustee shall not transfer this Guarantee Agreement to any
Person except the Trustee shall assign rights hereunder to a Holder to the
extent such assignment is necessary to exercise such Holder's rights pursuant to
Section 5.04 or to a Successor Trustee upon acceptance by such Successor Trustee
of its appointment to act as Successor Trustee. The right, title and interest of
the Trustee shall automatically vest in any Successor Trustee, and such vesting
and cessation of title shall be effective whether or not conveyancing documents
have been executed and delivered pursuant to the appointment of such Successor
Trustee.
(b) If an Event of Default has occurred and is continuing, the Trustee shall
enforce this Guarantee Agreement for the benefit of the Holders.
(c) The Trustee, before the occurrence of any Event of Default and after the
curing or waiving of all Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set forth in this
Guarantee Agreement, and no implied covenants shall be read into this Guarantee
Agreement against the Trustee. In case an Event of Default has occurred (that
has not been cured or waived pursuant to Section 2.06), the Trustee shall
exercise such of the rights and powers vested in it by this Guarantee Agreement,
and use the same degree of care and skill in its exercise thereof, as a prudent
person would exercise or use under the circumstances in the conduct of his or
her own affairs.
(d) No provision of this Guarantee Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that:
(i) prior to the occurrence of any Event of Default and after the curing or
waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Guarantee Agreement,
and the Trustee shall not be liable except for the performance
of such duties and obligations as are specifically set forth
in this Guarantee Agreement; and
(B) in the absence of bad faith on the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the
Trustee and conforming to the requirements of this Guarantee
Agreement; but in the case of any such certificates or
opinions that by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall be
under a duty to examine the same to determine whether or not
they conform to the requirements of this Guarantee Agreement;
(ii) the Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer of the Trustee, unless it shall be
proved that the Trustee was negligent in ascertaining the pertinent
facts upon which such judgment was made;
(iii) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the
direction of the Holders of a Majority in liquidation amount of the
Preferred Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee under this
Guarantee Agreement; and
(iv) no provision of this Guarantee Agreement shall require the Trustee to
expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of
any of its rights or powers, if the Trustee shall have reasonable
grounds for believing that the repayment of such funds or liability is
not reasonably assured to it under the terms of this Guarantee
Agreement or adequate indemnity against such risk or liability is not
reasonably assured to it.
Section 3.02. Certain Rights of Trustee.
(a) Subject to the provisions of Section 3.01:
(i) the Trustee may rely and shall be fully protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have been signed,
sent or presented by the proper party or parties;
(ii) any direction or act of the Guarantor contemplated by this Guarantee
Agreement shall be sufficiently evidenced by an Officers' Certificate;
(iii) whenever, in the administration of this Guarantee Agreement, the
Trustee shall deem it desirable that a matter be proved or established
before taking, suffering or omitting any action hereunder, the Trustee
(unless other evidence is herein specifically prescribed) may, in the
absence of bad faith on its part, request and rely upon an Officers'
Certificate which, upon receipt of such request, shall be promptly
delivered by the Guarantor;
(iv) the Trustee may consult with counsel of its choice, and the written
advice or opinion of such counsel with respect to legal matters shall
be full and complete authorization and protection in respect of any
action taken, suffered or omitted by it hereunder in good faith and in
accordance with such advice or opinion; such counsel may be counsel to
the Guarantor or any of its Affiliates and may include any of its
employees; the Trustee shall have the right at any time to seek
instructions concerning the administration of this Guarantee Agreement
from any court of competent jurisdiction;
(v) the Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Guarantee Agreement at the request or direction
of any Holder, unless such Holder shall have provided to the Trustee such
adequate security and indemnity as would satisfy a reasonable person in the
position of the Trustee, against the costs, expenses (including attorneys'
fees and expenses) and liabilities that might be incurred by it in
complying with such request or direction, including such reasonable
advances as may be requested by the Trustee; provided that nothing
contained in this Section 3.02(a)(v) shall be taken to relieve the Trustee,
upon the occurrence of an Event of Default, of its obligation to exercise
the rights and powers vested in it by this Guarantee Agreement;
(vi) the Trustee shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other
paper or document, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as it may
see fit;
(vii) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys, and the Trustee shall not be responsible for any misconduct
or negligence on the part of any agent or attorney appointed with due
care by it hereunder; and
(viii) whenever in the administration of this Guarantee Agreement the Trustee
shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder, the
Trustee (i) may request instructions from the Holders, (ii) may refrain
from enforcing such remedy or right or taking such other action until
such instructions are received, and (iii) shall be protected in acting
in accordance with such instructions.
(b) No provision of this Guarantee Agreement shall be deemed to impose any duty
or obligation on the Trustee to perform any act or acts or exercise any right,
power, duty or obligation conferred or imposed on it in any jurisdiction in
which it shall be illegal, or in which the Trustee shall be unqualified or
incompetent in accordance with applicable law, to perform any such act or acts
or to exercise any such right, power, duty or obligation. No permissive power or
authority available to the Trustee shall be construed to be a duty.
Section 3.03. Compensation; Fees; Indemnity. The Guarantor agrees:
(a) to pay to the Trustee from time to time reasonable compensation for all
services rendered by the Trustee hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee of an
express trust);
(b) except as otherwise expressly provided herein, to reimburse the Trustee upon
request for all reasonable expenses, disbursements and advances incurred or made
by the Trustee in accordance with any provision of this Guarantee Agreement
(including the reasonable compensation and the expenses and disbursements of its
agents and counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith; and
(c) to indemnify the Trustee for, and to hold the Trustee harmless against, any
and all loss, damage, claims, liability or expense incurred without negligence
or bad faith on its part, arising out of or in connection with the acceptance or
administration of this Guarantee Agreement, including the costs and expenses of
defending itself against any claim or liability in connection with the exercise
or performance of any of its powers or duties hereunder.
The provisions of this Section 3.03 shall survive the termination of this
Guarantee Agreement.
Article IV
TRUSTEE
Section 4.01. Trustee; Eligibility.
(a) There shall at all times be a Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the laws of the United
States of America or any State or Territory thereof or of the District of
Columbia, or a corporation or Person permitted by the Securities and
Exchange Commission to act as an institutional trustee under the Trust
Indenture Act, authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least 50 million U.S.
dollars ($50,000,000), and subject to supervision or examination by
Federal, State, Territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant to
law or to the requirements of the supervising or examining authority
referred to above, then, for the purposes of this Section 4.01(a)(ii), the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published.
(b) If at any time the Trustee shall cease to be eligible to so act under
Section 4.01(a), the Trustee shall immediately resign in the manner
and with the effect set out in Section 4.02(c).
(c) If the Trustee has or shall acquire any "conflicting interest" within
the meaning of Section 310(b) of the Trust Indenture Act, the Trustee
and Guarantor shall in all respects comply with the provisions of
Section 310(b) of the Trust Indenture Act, subject to the rights of
the Trustee under the penultimate paragraph thereof.
Section 4.02. Appointment, Removal and Resignation of Trustee.
(a) Subject to Section 4.02(b), the Trustee may be appointed or removed
without cause at any time by the Guarantor.
(b) The Trustee shall not be removed until a Successor Trustee has been
appointed and has accepted such appointment by written instrument
executed by such Successor Trustee and delivered to the Guarantor.
(c) The Trustee appointed to office shall hold office until a Successor
Trustee shall have been appointed or until its removal or resignation.
The Trustee may resign from office (without need for prior or
subsequent accounting) by an instrument in writing executed by the
Trustee and delivered to the Guarantor, which resignation shall not
take effect until a Successor Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such
Successor Trustee and delivered to the Guarantor and the resigning
Trustee.
(d) If no Successor Trustee shall have been appointed and accepted
appointment as provided in this Section 4.02 within 60 days after
delivery to the Guarantor of an instrument of resignation, the
resigning Trustee may petition any court of competent jurisdiction for
appointment of a Successor Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a
Successor Trustee.
Article V
GUARANTEE
Section 5.01. Guarantee. The Guarantor irrevocably and unconditionally agrees to
pay in full to the Holders the Guarantee Payments (without duplication of
amounts theretofore paid by or on behalf of the Trust), as and when due,
regardless of any defense, right of set-off or counterclaim which the Guarantor
may have or assert against any Person. The Guarantor's obligation to make a
Guarantee Payment may be satisfied by direct payment of the required amounts by
the Guarantor to the Holders or by causing the Trust to pay such amounts to the
Holders.
Section 5.02. Waiver of Notice and Demand. The Guarantor hereby waives notice of
acceptance of this Guarantee Agreement and of any liability to which it applies
or may apply, presentment, demand for payment, any right to require a proceeding
first against the Trust or any other Person before proceeding against the
Guarantor, protest, notice of nonpayment, notice of dishonor, notice of
redemption and all other notices and demands.
Section 5.03. Obligations Not Affected. The obligation of the Guarantor to make
the Guarantee Payments under this Guarantee Agreement shall in no way be
affected or impaired by reason of the happening from time to time of any of the
following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Trust of any express or implied
agreement, covenant, term or condition relating to the Preferred
Securities to be performed or observed by the Trust;
(b) the extension of time for the payment by the Trust of all or any
portion of the Distributions, Redemption Price, Liquidation
Distribution or any other sums payable under the terms of the
Preferred Securities or the extension of time for the performance of
any other obligation under, arising out of, or in connection with, the
Preferred Securities (other than an extension of time for payment of
Distributions, Redemption Price, Liquidation Distribution or other sum
payable that results from the extension of any interest payment period
on the Junior Subordinated Notes permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence on the part of the
Holders to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Holders pursuant to the terms of the Preferred
Securities, or any action on the part of the Trust granting indulgence
or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or
readjustment of debt of, or other similar proceedings affecting, the
Trust or any of the assets of the Trust;
(e) any invalidity of, or defect or deficiency in, the Preferred
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby or
hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute a
legal or equitable discharge or defense of a guarantor, it being the
intent of this Section 5.03 that the obligations of the Guarantor
hereunder shall be absolute and unconditional under any and all
circumstances.
There shall be no obligation of the Holders to give notice to,
or obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
Section 5.04. Rights of Holders. The Guarantor expressly acknowledges that: (i)
this Guarantee Agreement will be deposited with the Trustee to be held for the
benefit of the Holders; (ii) the Trustee has the right to enforce this Guarantee
Agreement on behalf of the Holders; (iii) the Holders of a Majority in
liquidation amount of the Preferred Securities have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee in respect of this Guarantee Agreement or exercising any trust or
power conferred upon the Trustee under this Guarantee Agreement, provided that
such direction shall not be in conflict with any rule of law or with this
Guarantee Agreement, and could not involve the Trustee in personal liability in
circumstances where reasonable indemnity would not be adequate; and (iv) any
Holder may institute a legal proceeding directly against the Guarantor to
enforce its rights under this Guarantee Agreement, without first instituting a
legal proceeding against or requesting or directing that action be taken by the
Trustee or any other Person; it being understood and intended that no one or
more of such Holders shall have any right in any manner whatsoever by virtue of,
or by availing of, any provision of this Guarantee Agreement to affect, disturb
or prejudice the rights of any other of such Holders or to obtain or to seek to
obtain priority or preference over any other of such Holders or to enforce any
right under this Guarantee Agreement, except in the manner herein provided and
for the equal and ratable benefit of all of such Holders.
Section 5.05. Guarantee of Payment. This Guarantee Agreement creates a guarantee
of payment and not of collection. This Guarantee Agreement will not be
discharged except by payment of the Guarantee Payments in full (without
duplication) or upon the distribution of Junior Subordinated Notes to the
Holders in exchange for all of the Preferred Securities.
Section 5.06. Subrogation. The Guarantor shall be subrogated to all (if any)
rights of the Holders against the Trust in respect of any amounts paid to the
Holders by the Guarantor under this Guarantee Agreement; provided, however, that
the Guarantor shall not (except to the extent required by mandatory provisions
of law) be entitled to enforce or exercise any rights which it may acquire by
way of subrogation or any indemnity, reimbursement or other agreement, in all
cases as a result of payment under this Guarantee Agreement, if, at the time of
any such payment, any amounts of Guarantee Payments are due and unpaid under
this Guarantee Agreement. If any amount shall be paid to the Guarantor in
violation of the preceding sentence, the Guarantor agrees to hold such amount in
trust for the Holders and to pay over such amount to the Holders.
Section 5.07. Independent Obligations. The Guarantor acknowledges that its
obligations hereunder are independent of the obligations of the Trust with
respect to the Preferred Securities and that the Guarantor shall be liable as
principal and as debtor hereunder to make Guarantee Payments pursuant to the
terms of this Guarantee Agreement notwithstanding the occurrence of any event
referred to in subsections (a) through (g), inclusive, of Section 5.03 hereof.
Article VI
SUBORDINATION
Section 6.01. Subordination. This Guarantee Agreement will constitute an
unsecured obligation of the Guarantor and will rank (i) subordinate and junior
in right of payment to all other liabilities of the Guarantor, including the
Junior Subordinated Notes, except those obligations or liabilities made pari
passu or subordinate by their terms, (ii) pari passu with the most senior
preferred or preference stock now or hereafter issued by the Guarantor and with
any guarantee now or hereafter entered into by the Guarantor in respect of any
preferred or preference securities of any Affiliate of the Guarantor, and (iii)
senior to all common stock of the Guarantor.
Article VII
TERMINATION
Section 7.01. Termination. This Guarantee Agreement shall terminate and be of no
further force and effect upon: (i) full payment of the Redemption Price of all
Preferred Securities, (ii) the distribution of Junior Subordinated Notes to the
Holders in exchange for all of the Preferred Securities, or (iii) full payment
of the amounts payable in accordance with the Trust Agreement upon liquidation
of the Trust. Notwithstanding the foregoing, this Guarantee Agreement will
continue to be effective or will be reinstated, as the case may be, if at any
time any Holder must restore payment of any sums paid with respect to Preferred
Securities or under this Guarantee Agreement.
Article VIII
MISCELLANEOUS
Section 8.01. Successors and Assigns. All guarantees and agreements contained in
this Guarantee Agreement shall bind the successors, assigns, receivers, trustees
and representatives of the Guarantor and shall inure to the benefit of the
Holders of the Preferred Securities then outstanding. Except in connection with
a consolidation, merger, conveyance, transfer, or lease involving the Guarantor
that is permitted under Article Eight of the Indenture, the Guarantor shall not
assign its obligations hereunder.
Section 8.02. Amendments. Except with respect to any changes which do not
materially and adversely affect the rights of Holders (in which case no consent
of Holders will be required), this Guarantee Agreement may only be amended with
the prior approval of the Holders of not less than 66-2/3% in liquidation amount
of all the outstanding Preferred Securities. The provisions of Article VI of the
Trust Agreement concerning meetings of Holders shall apply to the giving of such
approval.
Section 8.03. Notices. Any notice, request or other communication required or
permitted to be given hereunder shall be in writing, duly signed by the party
giving such notice, and delivered, telecopied or mailed by first class mail as
follows:
(a) if given to the Guarantor, to the address set forth below or such other
address as the Guarantor may give notice of to the Trustee and the Holders:
Alabama Power Company
000 Xxxxx 00xx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Facsimile No.: (000) 000-0000
Attn: Treasurer
with copy to:
Southern Company Services, Inc.
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Facsimile No.: (000) 000-0000
Attention: Corporate Finance Department
(b) if given to the Trust, in care of the Trustee, or to the Trustee at the
Trust's (and the Trustee's) address set forth below or such other address as the
Trustee on behalf of the Trust may give notice to the Holders:
Alabama Power Capital Trust III
x/x Xxx Xxxxx Xxxxxxxxx Bank
000 X. 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Corporate Trustee Administration Department
(c) if given to any Holder, at the address set forth on the books and records of
the Trust.
All notices hereunder shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
Section 8.04. Benefit. This Guarantee Agreement is solely for the benefit of the
Holders and, subject to Section 3.01(a), is not separately transferable from the
Preferred Securities.
Section 8.05. Interpretation. In this Guarantee Agreement, unless the
context otherwise requires:
(a) capitalized terms used in this Guarantee Agreement but not defined in the
preamble hereto have the respective meanings assigned to them in Section 1.01;
(b) a term defined anywhere in this Guarantee Agreement has the same meaning
throughout;
(c) all references to "the Guarantee Agreement" or "this Guarantee Agreement"
are to this Guarantee Agreement as modified, supplemented or amended from time
to time;
(d) all references in this Guarantee Agreement to Articles and Sections are to
Articles and Sections of this Guarantee Agreement unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning when used in
this Guarantee Agreement unless otherwise defined in this Guarantee Agreement or
unless the context otherwise requires;
(f) a reference to the singular includes the plural and vice versa; and
(g) the masculine, feminine or neuter genders used herein shall include the
masculine, feminine and neuter genders.
Section 8.06. Governing Law. THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF
NEW YORK. THE GUARANTOR HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND ANY COURT
IN THE STATE OF NEW YORK LOCATED IN THE CITY AND COUNTY OF NEW YORK IN ANY
ACTION, SUIT OR PROCEEDING BROUGHT AGAINST IT AND RELATED TO OR IN CONNECTION
WITH THIS GUARANTEE AGREEMENT OR THE TRANSACTIONS CONTEMPLATED THEREBY, AND TO
THE EXTENT PERMITTED BY APPLICABLE LAW, THE GUARANTOR HEREBY WAIVES AND AGREES
NOT TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE IN ANY SUCH SUIT,
ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF SUCH COURTS, THAT THE SUIT, ACTION OR PROCEEDING IS BROUGHT IN
AN INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS
IMPROPER, OR THAT THIS GUARANTEE AGREEMENT OR ANY DOCUMENT OR ANY INSTRUMENT
REFERRED TO HEREIN OR THE SUBJECT MATTER HEREOF MAY NOT BE LITIGATED IN OR BY
SUCH COURTS. TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE GUARANTOR AGREES NOT
TO SEEK AND HEREBY WAIVES THE RIGHT TO ANY REVIEW OF THE JUDGMENT OF ANY SUCH
COURT BY ANY COURT OF ANY OTHER NATION OR JURISDICTION WHICH MAY BE CALLED UPON
TO GRANT AN ENFORCEMENT OF SUCH JUDGMENT. THE GUARANTOR AGREES THAT SERVICE OF
PROCESS MAY BE MADE UPON IT BY CERTIFIED OR REGISTERED MAIL TO THE ADDRESS FOR
NOTICES SET FORTH IN THIS GUARANTEE AGREEMENT OR ANY METHOD AUTHORIZED BY THE
LAWS OF NEW YORK.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
THIS GUARANTEE AGREEMENT is executed as of the day and year
first above written.
ALABAMA POWER COMPANY
By: Name: Xxxxxxx X. Xxxxxxxx, III
Title: Executive Vice President, Chief
Financial Officer, and Treasurer
THE CHASE MANHATTAN BANK
By:
Name: X. Xxxxxxxx
Title: Assistant Vice President
GUARANTEE AGREEMENT
Between
Alabama Power Company
(as Guarantor)
and
The Chase Manhattan Bank
(as Trustee)
dated as of
February 1, 1999
CROSS-REFERENCE TABLE1
Section of Trust Indenture Act Section of
of 1939, as amended Guarantee Agreement
310(a).............................................................................................4.01(a)
310(b).......................................................................................4.01(c), 2.08
310(c)........................................................................................Inapplicable
311(a).............................................................................................2.02(b)
311(b).............................................................................................2.02(b)
311(c)........................................................................................Inapplicable
312(a).............................................................................................2.02(a)
312(b).............................................................................................2.02(b)
313...................................................................................................2.03
314(a)................................................................................................2.04
314(b)........................................................................................Inapplicable
314(c)................................................................................................2.05
314(d)........................................................................................Inapplicable
314(e)....................................................................................1.01, 2.05, 3.02
314(f)..........................................................................................2.01, 3.02
315(a).............................................................................................3.01(d)
315(b)................................................................................................2.07
315(c)................................................................................................3.01
315(d).............................................................................................3.01(d)
315(e)........................................................................................Inapplicable
316(a).......................................................................................5.04(i), 2.06
316(b)................................................................................................5.03
316(c)................................................................................................2.02
317(a)........................................................................................Inapplicable
317(b)........................................................................................Inapplicable
318(a).............................................................................................2.01(b)
318(b)................................................................................................2.01
318(c).............................................................................................2.01(a)
This Cross-Reference does not constitute part of the Guarantee Agreement and shall not affect
the interpretation of any of its terms or provisions.
TABLE OF CONTENTS
Page
Article IDEFINITIONS.....................................................................................1
Section 1.01. Definitions..........................................................................1
Article IITRUST INDENTURE ACT............................................................................4
Section 2.01. Trust Indenture Act; Application.....................................................4
Section 2.02. Lists of Holders of Securities.......................................................4
Section 2.03. Reports by the Trustee...............................................................4
Section 2.04. Periodic Reports to Trustee..........................................................4
Section 2.05. Evidence of Compliance with Conditions Precedent.....................................5
Section 2.06. Events of Default; Waiver............................................................5
Section 2.07. Event of Default; Notice.............................................................5
Section 2.08. Conflicting Interests................................................................5
Article IIIPOWERS, DUTIES AND RIGHTS OF TRUSTEE..........................................................6
Section 3.01. Powers and Duties of the Trustee.....................................................6
Section 3.02. Certain Rights of Trustee............................................................7
Section 3.03. Compensation; Fees; Indemnity........................................................9
Article IVTRUSTEE........................................................................................9
Section 4.01. Trustee; Eligibility.................................................................9
Section 4.02. Appointment, Removal and Resignation of Trustee.....................................10
Article VGUARANTEE......................................................................................10
Section 5.01. Guarantee...........................................................................10
Section 5.02. Waiver of Notice and Demand.........................................................10
Section 5.03. Obligations Not Affected............................................................11
Section 5.04. Rights of Holders...................................................................12
Section 5.05. Guarantee of Payment................................................................12
Section 5.06. Subrogation.........................................................................12
Section 5.07. Independent Obligations.............................................................12
Article VISUBORDINATION.................................................................................13
Section 6.01. Subordination.......................................................................13
Article VIITERMINATION..................................................................................13
Section 7.01. Termination.........................................................................13
Article VIIIMISCELLANEOUS...............................................................................13
Section 8.01. Successors and Assigns..............................................................13
Section 8.02. Amendments..........................................................................14
Section 8.03. Notices.............................................................................14
Section 8.04. Benefit.............................................................................15
Section 8.05. Interpretation......................................................................15
Section 8.06. Governing Law.......................................................................15
