[Federal Register Volume 62, Number 99 (Thursday, May 22, 1997)]
[Notices]
[Pages 28075-28077]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-13453]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 35-26718]


Filings Under the Public Utility Holding Company Act of 1935, as 
Amended (``Act'')

May 16, 1997.
    Notice is hereby given that the following filing(s) has/have been 
made with the Commission pursuant to provisions of the Act and rules 
promulgated thereunder. All interested persons are referred to the 
applicant(s) and/or declaration(s) for complete statements of the 
proposed transaction(s) summarized below. The application(s) and/or 
declaration(s) and any amendments thereto is/are available for public 
inspection through the Commission's Office of Public Reference.
    Interested persons wishing to comment or request a hearing on the 
applicant(s) and/or declaration(s) should submit their views in writing 
by June 9, 1997, to the Secretary, Securities and Exchange Commission, 
Washington, D.C. 20549, and serve a copy on the relevant applicant(s) 
and/or declarant(s) at the address(es) specified below. Proof of 
service (by affidavit or, in case of an attorney at law, by 
certificate) should be filed with the request. Any request for hearing 
shall identify specifically the issues of fact or law that are 
disputed. A person who so requests will be notified of any hearing, if 
ordered, and will receive a copy of any notice or order issued in the 
matter. After said date, the application(s) and/or declaration(s), as 
filed or as amended, may be granted and/or permitted to become 
effective.

Alabama Power Company, et al. (70-8461)

    Alabama Power Company, 600 North 18th Street, Birmingham, Alabama 
35291, (``Alabama''), Georgia Power Company, 333 Piedmont Avenue, N.E., 
Atlanta, Georgia 30308 (``Georgia''), Gulf Power Company, 500 Bayfront 
Parkway, Pensacola, Florida 32501 (``Gulf''), Mississippi Power 
Company, 2992 West Beach, Gulfport, Mississippi 39501 
(``Mississippi''), and Savannah Electric and Power Company, 600 East 
Bay Street, Savannah, Georgia 31401 (``Savannah'') (collectively, 
``Operating Companies''), electric public utility subsidiaries of The 
Southern Company, a registered holding company, have filed a post-
effective amendment to their application-declaration under sections 
6(a), 7, 9(a), 10 and 12(b) of the Act and rules 45 and 54 thereunder.
    By order dated December 15, 1994 (HCAR No. 26187) (``December 1994 
Order''), the Operating Companies were authorized to form separate 
special purpose subsidiaries. Each special purpose subsidiary would 
issue and sell preferred securities in one or more series from time to 
time through December 31, 1997. In the December 1994 Order, Georgia was 
authorized to issue $100 million of preferred securities and 
jurisdiction was reserved pending completion of the record over the 
issuance of preferred securities in the amount of $175 million for 
Alabama, $200 million for Georgia, $15 million for Gulf, $15 million 
for Mississippi and $10 million for Savannah.
    By order dated January 17, 1996 (HCAR No. 26462) (``January 1996 
Order''), Alabama was authorized to issue $97 million of preferred 
securities and jurisdiction was reserved pending completion of the 
record over the issuance of preferred securities in the amount of $78 
million for Alabama, $200 million for Georgia, $15 million for Gulf, 
$15 million for Mississippi and $10 million for Savannah.
    By post-effective amendment dated June 18, 1996, the Operating 
Companies requested that the authority to issue preferred securities be 
increased to $250 million for Alabama, $500 million for Georgia, $60 
million for Gulf, $60 million for Mississippi and $35 million for 
Savannah. In the case of Alabama and Georgia, such amounts were in 
addition to the amounts authorized by the December 1994 Order and the 
January 1996 Order. The Operating Companies also requested that the

[[Page 28076]]

authority be extended through December 31, 2001.
    By order dated August 26, 1996 (HCAR No. 26560) (``August 1996 
Order'') Georgia was authorized to issue $400 million of preferred 
securities and the Operating Companies were authorized, pending 
completion of the record, to effect the sale of preferred securities in 
one or more series from time to time through December 31, 2001 in the 
amount of $250 million for Alabama, $100 million for Georgia, $60 
million for Gulf, $60 million for Mississippi and $35 million for 
Savannah.
    By subsequent orders (HCAR Nos. 26644, 26657 and 26660, dated 
January 14, 1997, January 29, 1997 and February 5, 1997, respectively) 
Alabama, Gulf and Mississippi were authorized to sell preferred 
securities in respective amounts of $250 million, $60 million and $55 
million. Currently, the Commission has reserved jurisdiction over the 
issuance and sale of additional preferred securities in the amounts of 
$100 million for Georgia, $5 million for Mississippi and $35 million 
for Savannah (collectively, ``Reserved Preferred'').
    The Operating Companies now request additional authority to sell 
preferred securities (``New Preferred''), as follows: $500 million for 
Alabama, $400 million for Georgia, $50 million for Gulf, $70 million 
for Mississippi, and $5 million for Savannah. The applicants request 
that such authority be in addition to the Reserved Preferred. The 
Operating Companies also ask that the Commission reserve jurisdiction, 
pending completion of the record, over the issuance and sale of the 
Reserved Preferred and New Preferred, through December 31, 2005, in 
aggregate amounts of up to: $500 million for Alabama, $500 million for 
Georgia, $50 million for Gulf, $75 million for Mississippi and $40 
million for Savannah (Reserved Preferred, together with New Preferred, 
are hereinafter called ``Preferred Securities'').
    Each Operating Company will acquire all of the common stock 
(``Common Securities'') or all of the general partnership interests, as 
the case may be, of its Special Purpose Subsidiary for an amount up to 
21% of the total equity capitalization from time-to-time of such 
Special Purpose Subsidiary (``Equity Contribution''). Each Operating 
Company may issue and sell to its Special Purpose Subsidiary, at any 
time or from time-to-time in one or more series, subordinate 
debentures, promissory notes or other debt instruments (``Notes'') 
governed by an indenture or other document, and the Special Purpose 
Subsidiary will apply both the Equity Contribution and the proceeds 
from the sale of Preferred Securities to purchase Notes of such 
Operating Company. Alternatively, each Operating Company may enter into 
a loan agreement or agreements with its Special Purpose Subsidiary 
under which it will loan to the Operating Company (``Loans'') both the 
Equity Contribution and the proceeds from the sale of the Preferred 
Securities evidenced by Notes. Each Operating Company may also 
guarantee (``Guaranties'') the payment of dividends or distributions on 
the Preferred Securities, payments to the Preferred Securities holders 
of amounts due upon liquidation or redemption of the Preferred 
Securities and certain additional amounts that may be payable regarding 
the Preferred Securities.
    Each Note will have a term, including extensions, of up to 50 
years. Prior to maturity, each Operating Company will pay only interest 
on its Notes at a rate equal to the dividend or distribution rate on 
the related series of Preferred Securities. The dividend or 
distribution rate may be either fixed or adjustable, determined on a 
periodic basis by auction or remarketing procedures, in accordance with 
a formula or formulae based upon certain reference rates, or by other 
predetermined methods. Such interest payments will constitute each 
Special Purpose Subsidiary's only income and will be used by it to pay 
monthly dividends or distributions on the Preferred Securities issued 
by it and dividends or distributions on the common stock or the general 
partnership interests of such Special Purpose Subsidiary.
    Dividend payments or distributions on the Preferred Securities will 
be made monthly, will be cumulative and must be made to the extent that 
funds are legally available. However, each Operating Company will have 
the right to defer payment of interest on its Notes for up to five 
years, provided that, if dividends or distributions on the Preferred 
Securities of any series are not paid for up to 18 consecutive months, 
then the holders of the Preferred Securities of such series may have 
the right to appoint a trustee, special general partner or other 
special representative to enforce the Special Purpose Subsidiary's 
rights under the related Note and Guaranty. Each Special Purpose 
Subsidiary will have the parallel right to defer dividend payments or 
distributions on the related series of Preferred Securities for up to 
five years. The dividend or distribution rates, payment dates, 
redemption and other similar provisions of each series of Preferred 
Securities will be substantially identical to the interest rates, 
payment dates, redemption and other provisions of the related Note 
issued by the Operating Company.
    The Notes and related Guaranties of each Operating Company will be 
subordinate to all other existing and future indebtedness for borrowed 
money of such Operating Company and will have no cross-default 
provisions with respect to other indebtedness of the Operating Company. 
However, each Operating Company may not declare and pay dividends on 
its outstanding preferred or common stock unless all payments due under 
its Notes and Guaranties have been made.
    It is expected that each Operating Company's interest payments on 
the Notes issued by it will be deductible for federal income tax 
purposes and that its Special Purpose Subsidiary will be treated as a 
partnership for federal income tax purposes. Consequently, holders of 
the Preferred Securities will be deemed to have received partnership 
distributions in respect of their dividends or distributions from the 
respective Special Purpose Subsidiary and will not be entitled to any 
``dividends received deduction'' under the Internal Revenue Code.
    The Preferred Securities are optionally redeemable by the Special 
Purpose Subsidiary at a price equal to their par or stated value or 
liquidation preference, plus any accrued and unpaid dividends or 
distributions, at any time after a specified date not later than 10 
years from their date of issuance or upon the occurrence of certain 
events. The Preferred Securities of any series may also be subject to 
mandatory redemption upon the occurrence of certain events. Each 
Operating Company also may have the right in certain cases to exchange 
the Preferred Securities of its Special Purpose Subsidiary for the 
Notes or other junior subordinated debt of the Operating Company.
    In the event that any Special Purpose Subsidiary is required to 
withhold or deduct certain amounts in connection with dividend, 
distribution or other payments, it may also have the obligation to 
``gross up'' such payments so that the holders of the Preferred 
Securities will receive the same payment after such withholding or 
deduction as they would have received if no such withholding or 
deduction were required. In such event, the related Operating Company's 
obligations under its Note and Guaranty may also cover such ``gross 
up'' obligation. In addition, if any Special Purpose Subsidiary is 
required to pay taxes on income derived from interest payments on the 
Notes, the

[[Page 28077]]

related Operating Company may be required to pay additional interest 
equal to the tax payment. Each Operating Company, individually, expects 
to apply the net proceeds of the Loans to the repayment of outstanding 
short-term debt, for construction purposes, and for other gereral 
corporate purposes, including the redemption or other retirement of 
outstanding senior securities.

    For the Commission, by the Division of Investment Management, 
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-13453 Filed 5-21-97; 8:45 am]
BILLING CODE 8010-01-M