$50,000,000 Series A 6.70% Senior Insured Quarterly Notes (IQ Notes)
due June 30, 2038
GULF POWER COMPANY
UNDERWRITING AGREEMENT
June 17, 1998
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Gulf Power Company, a Maine corporation (the "Company"),
confirms its agreement (the "Agreement") with you (the "Underwriter"), with
respect to the sale by the Company and the purchase by the Underwriter, of
$50,000,000 principal amount of the Series A 6.70% Senior Insured Quarterly
Notes (IQ Notes) due June 30, 2038 (the "Senior Notes").
The Company understands that the Underwriter proposes to make
a public offering of the Senior Notes as soon as the Underwriter deems advisable
after this Agreement has been executed and delivered. The Senior Notes will be
issued pursuant to an indenture, dated as of January 1, 1998 (the "Base
Indenture"), between the Company and The Chase Manhattan Bank, 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.
SECTION 1. REPRESENTATIONS AND WARRANTIES. The Company represents
and warrants to the Underwriter as follows:
(a) A registration statement on Form S-3, as amended (File Nos.
333-42033, ▇▇▇-▇▇▇▇▇-▇▇ and 333-42033-02), in respect of the Senior
Notes and certain other securities has been prepared and filed in
accordance with the provisions of the Securities Act of 1933, as
amended (the "1933 Act"), with the Securities and Exchange Commission
(the "Commission"); such registration statement, as amended, and any
post-effective amendment thereto, each in the form heretofore delivered
or to be delivered to the Underwriter, has been declared effective by
the Commission in such form (except that copies of the registration
statement, as amended, and any post-effective amendment delivered to
the Underwriter need not include exhibits but shall include all
documents incorporated by reference therein); and no stop order
suspending the effectiveness of such registration statement has been
issued and no proceeding for that purpose has been initiated or, to the
best knowledge of the Company, threatened by the Commission (any
preliminary prospectus, as supplemented by a preliminary prospectus
supplement, included in such registration statement or filed with the
Commission pursuant to Rule 424(a) of the rules and regulations of the
Commission under the 1933 Act, being hereinafter called a "Preliminary
Prospectus"); such registration statement, as it became effective,
including the exhibits thereto and all documents incorporated by
reference therein pursuant to Item 12 of Form S-3 at the time such
registration statement became effective, being hereinafter called the
"Registration Statement"; the prospectus relating to the Senior Notes,
in the form in which it was included in the Registration Statement at
the time it became effective, being hereinafter called the
"Prospectus"; any reference herein to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under
the 1933 Act, as of the date of such Preliminary Prospectus or
Prospectus, as the case may be; any reference to any amendment or
supplement to any Preliminary Prospectus or the Prospectus shall be
deemed to refer to and include any documents filed after the date of
such Preliminary Prospectus or Prospectus, as the case may be, under
the Securities Exchange Act of 1934, as amended (the "1934 Act"), and
incorporated by reference in such Preliminary Prospectus or Prospectus,
as the case may be; any reference to any amendment to the Registration
Statement shall be deemed to refer to and include any annual report of
the Company filed pursuant to Section 13(a) or 15(d) of the 1934 Act
after the effective date of the Registration Statement that is
incorporated by reference in the Registration Statement; the
Prospectus, as supplemented by a preliminary prospectus supplement
dated June 10, 1998 relating to the Senior Notes, including any
documents incorporated by reference therein as of such date, being
hereinafter called the "Preliminary Supplemented Prospectus"; and the
Prospectus as amended or supplemented in final form by a prospectus
supplement relating to the Senior Notes in the form in which it is
filed with the Commission, pursuant to Rule 424(b) under the 1933 Act
in accordance with Section 3(g) hereof, including any documents
incorporated by reference therein as of the date of such filing, being
hereinafter called the "Final Supplemented Prospectus".
(b) The documents incorporated by reference in the Registration
Statement or Prospectus, when they were filed with the Commission,
complied in all material respects with the applicable provisions of the
1934 Act and the rules and regulations of the Commission thereunder,
and as of such time of filing, when read together with the Prospectus,
none of such documents contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and any
further documents so filed and incorporated by reference in the
Prospectus or any further amendment or supplement thereto, when such
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documents are filed with the Commission, will comply in all material
respects with the applicable provisions of the 1934 Act and the rules
and regulations of the Commission thereunder and, when read together
with the Prospectus as it otherwise may be amended or supplemented,
will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or 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 Underwriter with respect to: (A) any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by the Underwriter
expressly for use in the Preliminary Supplemented Prospectus or the
Final Supplemented Prospectus; or (B) any information set forth in the
Preliminary Supplemented Prospectus or the Final Supplemented
Prospectus under the captions "Description of the Series A Senior Notes
- Book-Entry Only Issuance -- The Depository Trust Company" and "The
Policy and the Insurer."
(c) The Registration Statement and the Prospectus and, to the extent
not used to confirm sales of the Senior Notes, the Preliminary
Supplemented Prospectus, comply, and the Final Supplemented Prospectus
and any further amendments or supplements to the Registration Statement
or the Prospectus, when any such post-effective amendments are declared
effective or supplements are filed with the Commission, as the case may
be, will comply, in all material respects with the applicable
provisions of the 1933 Act, the 1934 Act, the 1939 Act (hereinafter
defined) and the General Rules and Regulations of the Commission
thereunder and do not and will not, (i) as of the applicable effective
date as to the Registration Statement and any amendment thereto, (ii)
as of the filing date thereof as to the Preliminary Supplemented
Prospectus and (iii) as of the applicable filing date as to the Final
Supplemented Prospectus and any Prospectus as further amended or
supplemented, contain an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; except that the Company makes no warranties or
representations with respect to (A) that part of the Registration
Statement which shall constitute the Statements of Eligibility (Form
T-1) (collectively, the "Form T-1") under the Trust Indenture Act of
1939, as amended (the "1939 Act"), (B) statements or omissions made in
the Registration Statement, the Preliminary Supplemented Prospectus or
the Final Supplemented Prospectus in reliance upon and in conformity
with information furnished in writing to the Company by the Underwriter
expressly for use therein or (C) any information set forth in the
Preliminary Supplemented Prospectus or the Final Supplemented
Prospectus under the captions "Description of the Series A Senior Notes
-Book-Entry Only Issuance -- The Depository Trust Company" and "The
Policy and the Insurer."
(d) With respect to the Registration Statement, the conditions for use
of Form S-3, as set forth in the General Instructions thereof, have
been satisfied.
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(e) Since the respective dates as of which information is given in the
Registration Statement and the Final Supplemented Prospectus, except as
otherwise stated therein, there has been no material adverse change in
the business, properties or financial condition of the Company.
(f) The Company is a corporation duly organized and existing under the
laws of the State of Maine, is duly qualified to carry on its business
as a foreign corporation under the laws of the States of Florida,
Georgia and Mississippi, and has due corporate authority to carry on
the public utility business in which it is engaged and to own and
operate the properties used by it in such business, to enter into and
perform its obligations under this Agreement and the Indenture and to
issue and sell the Senior Notes to the Underwriter.
(g) This Agreement has been duly authorized, executed and delivered
by the Company.
(h) 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 Final Supplemented
Prospectus; and, on the Closing Date, the Indenture will have been duly
qualified under the 1939 Act.
(i) 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 as described in the Final Supplemented Prospectus, 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, 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 Final
Supplemented Prospectus.
(j) The execution, delivery and performance by the Company of this
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
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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.
(k) The Company has duly authorized all necessary action to be taken by
it for the procurement of an irrevocable financial guarantee insurance
policy (the "Insurance Policy") issued by MBIA Insurance Corporation
(the "Insurer"), insuring the payment of principal and interest on the
Senior Notes, when due.
(l) 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, except (A)
such as may be required under the 1933 Act or the rules and regulations
thereunder; (B) such as may be required under the Public Utility
Holding Company Act of 1935, as amended (the "1935 Act"); (C) the
qualification of the Indenture under the 1939 Act; (D) the approval of
the Florida Public Service Commission (the "Florida Commission"); and
(E) such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky
laws.
SECTION 2. SALE AND DELIVERY TO THE UNDERWRITER; CLOSING.
(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 the Underwriter, and the Underwriter agrees to purchase from
the Company, $50,000,000 principal amount of Senior Notes at a price equal to
96.85% of the principal amount thereof.
(b) Payment for and delivery of certificates for the Senior
Notes shall be made at the offices of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ at 10:00 A.M.,
Atlanta time, on June 24, 1998 (unless postponed in accordance with the
provisions of Section 10) or such other time, place or date as shall be agreed
5
upon by the Underwriter 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 against delivery
of the Senior Notes to the Underwriter.
The delivery of the Senior Notes shall be made in fully
registered form, registered in the name of CEDE & CO., to the offices of The
Depository Trust Company in New York, New York or its designee, and the
Underwriter shall accept such delivery.
The certificate(s) for the Senior Notes will be made available
for examination by the Underwriter not later than 12:00 Noon, New York time, on
the last business day prior to the Closing Date.
SECTION 3. COVENANTS OF THE COMPANY. The Company covenants with the
Underwriter as follows:
(a) The Company, on or prior to the Closing Date, will deliver to the
Underwriter conformed copies of the Registration Statement as
originally filed and of all amendments thereto, heretofore or hereafter
made, including any post-effective amendment (in each case including
all exhibits filed therewith, and including unsigned copies of each
consent and certificate included therein or filed as an exhibit
thereto, except exhibits incorporated by reference, unless specifically
requested). As soon as the Company is advised thereof, it will advise
the Underwriter orally of the issuance of any stop order under the 1933
Act with respect to the Registration Statement, or the institution of
any proceedings therefor, of which the Company shall have received
notice, and will use its best efforts to prevent the issuance of any
such stop order and to secure the prompt removal thereof, if issued.
The Company will deliver to the Underwriter sufficient conformed copies
of the Registration Statement, the Prospectus, the Preliminary
Supplemented Prospectus and the Final Supplemented Prospectus and of
all supplements and amendments thereto (in each case without exhibits)
for distribution to the Underwriter and, from time to time, as many
copies of the Prospectus, the Preliminary Supplemented Prospectus and
the Final Supplemented Prospectus as the Underwriter may reasonably
request for the purposes contemplated by the 1933 Act or the 1934 Act.
(b) The Company will furnish the Underwriter with copies of each
amendment and supplement to the Preliminary Supplemented Prospectus and
the Final Supplemented Prospectus relating to the offering of the
Senior Notes in such quantities as the Underwriter may from time to
time reasonably request. If, during the period (not exceeding nine
months) when the delivery of a prospectus shall be required by law in
connection with the sale of any Senior Notes by the Underwriter, any
event relating to or affecting the Company, or of which the Company
shall be advised in writing by the Underwriter, shall occur, which in
the opinion of the Company or of Underwriter's counsel should be set
forth in a supplement to or an amendment of the Preliminary
Supplemented Prospectus or Final Supplemented Prospectus, as the case
may be, in order to make the Preliminary Supplemented Prospectus or the
6
Final Supplemented Prospectus not misleading in the light of the
circumstances when it is delivered, or if for any other reason it shall
be necessary during such period to amend or supplement the Preliminary
Supplemented Prospectus or the Final Supplemented Prospectus or to file
under the 1934 Act any document incorporated by reference in the
Preliminary Prospectus or Prospectus in order to comply with the 1933
Act or the 1934 Act, the Company forthwith will (i) notify the
Underwriter to suspend solicitation of purchases of the Senior Notes
and (ii) at its expense, make any such filing or prepare and furnish to
the Underwriter a reasonable number of copies of a supplement or
supplements or an amendment or amendments to the Preliminary
Supplemented Prospectus or the Final Supplemented Prospectus which will
supplement or amend the Preliminary Supplemented Prospectus or the
Final Supplemented Prospectus so that, as supplemented or amended, it
will not contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements
therein, in the light of the circumstances when the Preliminary
Supplemented Prospectus or the Final Supplemented Prospectus is
delivered, not misleading or which will effect any other necessary
compliance. In case the Underwriter is required to deliver a prospectus
in connection with the sale of any Senior Notes after the expiration of
the period specified in the preceding sentence, the Company, upon the
request of the Underwriter, will furnish to the Underwriter, at the
expense of the Underwriter, a reasonable quantity of a supplemented or
amended prospectus, or supplements or amendments to the Final
Supplemented Prospectus, complying with Section 10(a) of the 1933 Act.
During the period specified in the second sentence of this subsection,
the Company will continue to prepare and file with the Commission on a
timely basis all documents or amendments required under the 1934 Act
and the rules and regulations thereunder; provided, that the Company
shall not file such documents or amendments without also furnishing
copies thereof prior to such filing to the Underwriter and ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ LLP.
(c) The Company will endeavor, in cooperation with the Underwriter, 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 Underwriter may designate; provided, however, that
the Company shall not be obligated to 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 requirements in connection with such qualification
deemed by the Company to be unduly burdensome.
(d) The Company will make generally available to its security holders
as soon as practicable but not later than 45 days after the close of
the period covered thereby, an earnings statement of the Company (in
form complying with the provisions of Rule 158 of the rules and
regulations under the 1933 Act) covering a twelve-month period
beginning not later than the first day of the Company's fiscal quarter
next following the "effective date" (as defined in Rule 158) of the
Registration Statement.
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(e) During a period of 15 days from the date of this Agreement, the
Company will not, without the Underwriter's prior written consent,
directly or indirectly, sell, offer to sell, grant any option for the
sale of, or otherwise dispose of, any Senior Notes or any security
convertible into or exchangeable into or exercisable for the Senior
Notes or any debt securities substantially similar to the Senior Notes
(except for the Senior Notes issued pursuant to this Agreement).
(f) As soon as practicable after the date of this Agreement, and in any
event within the time prescribed by Rule 424 under the 1933 Act, to
file the Final Supplemented Prospectus with the Commission and to
advise the Underwriter of such filing and to confirm such advice in
writing.
SECTION 4. PAYMENT OF EXPENSES. The Company will pay all
expenses incidental to the performance of its obligations under this Agreement,
including but not limited to, the expenses of (i) the printing and filing of the
Registration Statement as originally filed and of each amendment thereto, (ii)
the preparation, issuance and delivery of the certificate(s) for the Senior
Notes, (iii) the fees and disbursements of the Company's counsel and
accountants, (iv) the qualification of the Senior Notes under securities laws in
accordance with the provisions of Section 3(c) hereof, including filing fees and
the reasonable fees and disbursements of counsel for the Underwriter in
connection therewith and in connection with the preparation of any blue sky
survey (such fees and disbursements of counsel shall not exceed $3,500), (v) the
printing and delivery to the Underwriter of copies of the Registration Statement
as originally filed and of each amendment thereto and of the Prospectus, the
Preliminary Supplemented Prospectus, the Final Supplemented Prospectus, and any
amendments or supplements thereto, (vi) the printing and delivery to the
Underwriter 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 Senior 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 premium payable to the
Insurer in connection with the issuance of the Insurance Policy, and (xii) the
cost of qualifying the Senior Notes with The Depository Trust Company.
Except as otherwise provided in Section 9 hereof, the
Underwriter shall pay all other expenses incurred by it in connection with its
offering of the Senior Notes including fees and disbursements of its counsel,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP.
SECTION 5. CONDITIONS OF UNDERWRITER'S OBLIGATIONS. The obligations of
the Underwriter to purchase and pay for the Senior Notes are
subject to the following conditions:
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(a) No stop order suspending the effectiveness of the Registration
Statement shall be in effect on the Closing Date and no proceedings for
that purpose shall be pending before, or to the knowledge of the
Company threatened by, the Commission on such date. If filing of the
Preliminary Supplemented Prospectus or the Final Supplemented
Prospectus, or any supplement thereto, is required pursuant to Rule
424, the Preliminary Supplemented Prospectus or the Final Supplemented
Prospectus, and any such supplement, shall have been filed in the
manner and within the time period required by Rule 424.
(b) Any required orders of the Commission 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 Underwriter or the Company (but all
provisions of such order or orders heretofore entered, copies of which
have heretofore been delivered to the Underwriter, are deemed
acceptable to the Underwriter and the Company and all provisions of
such order or orders hereafter entered shall be deemed acceptable to
the Underwriter 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).
(c) On the Closing Date the Underwriter shall have received:
(1) The opinion, dated the Closing Date, of ▇▇▇▇▇ & ▇▇▇▇, a
Registered Limited Liability Partnership ("▇▇▇▇▇ & ▇▇▇▇"), general
counsel for the Company, substantially in the form attached hereto as
Schedule II-A.
(2) The opinion, dated the Closing Date, of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
LLP, counsel for the Company, substantially in the form attached hereto
as Schedule II-B.
(3) The opinion, dated the Closing Date, of ▇▇▇▇▇▇▇, Swaine &
▇▇▇▇▇, counsel to the Trustee, substantially in the form attached
hereto as Schedule III.
(4) The opinion, dated as of the Closing Date, of ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ LLP, counsel for the Underwriter, substantially in the Form
attached hereto as Schedule IV.
(5) The opinion, dated the Closing Date, of ▇▇▇▇▇ ▇▇▇▇,
counsel to the Insurer, substantially in the form attached hereto as
Schedule V.
(6) 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 Registration Statement and the Final Supplemented
Prospectus, 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 Underwriter shall have received a
certificate of the President or any Vice President of the Company, and
9
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, (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, and (iv) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been initiated or, to the knowledge of the Company,
threatened by the Commission.
(7) On the Closing Date, the Underwriter shall have received
from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP a letter dated the Closing Date to the effect
that: (A) they are independent public accountants with respect to the
Company within the meaning of the 1933 Act and the rules and
regulations under the 1933 Act; (B) in their opinion, the financial
statements and schedules audited by them and incorporated by reference
in the Final Supplemented Prospectus comply as to form in all material
respects with the applicable accounting requirements of the 1933 Act
and the 1934 Act and the rules and regulations under the 1933 Act and
the 1934 Act; (C) they have performed certain limited procedures
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) reading the unaudited financial statements, if any, of
the Company incorporated in the Final Supplemented Prospectus and
agreeing the amounts therein with the Company's accounting records;
(iii) making inquiries of certain officials of the Company who have
responsibility for financial and accounting matters regarding whether
the unaudited financial statements, if any, incorporated in the Final
Supplemented Prospectus (a) are in conformity with generally accepted
accounting principles applied on a basis substantially consistent with
that of the audited financial statements incorporated in the Final
Supplemented Prospectus and (b) comply as to form in all material
respects with the applicable accounting requirements of the 1934 Act
and the rules and regulations under the 1934 Act; (iv) reading the
unaudited amounts for Operating Revenues, Income Before Interest
Charges and Net Income After Dividends on Preferred Stock and the
unaudited Ratios of Earnings to Fixed Charges and Earnings to Fixed
Charges Plus Preferred Dividend Requirements (Pre-Income Tax Basis),
which amounts shall include such amounts for the latest period
subsequent to that covered by the financial statements incorporated by
reference in the Final Supplemented Prospectus for which such amounts
are available at the time this agreement becomes effective; (v) reading
the unaudited financial statements from which the amounts and ratios
described in (iv) were derived and agreeing the amounts therein to the
Company's accounting records; (vi) making inquiries of certain
officials of the Company who have responsibility for financial and
accounting matters regarding whether (a) the unaudited mounts and
ratios referred to in (iv) above and the unaudited and the unaudited
financial statements referred to in (v) above are stated on a basis
substantially consistent with that of the corresponding audited amounts
10
or ratios included or incorporated by reference in the Final
Supplemented Prospectus and (b) 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 incorporated in the Prospectus, except
in each case for changes or decreases which (I) the Final Supplemented
Prospectus 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; (vii) reading
the unaudited amounts for Operating Revenues, Income Before Interest
Charges and Net Income After Dividends on Preferred Stock and the
unaudited Ratios of Earnings to Fixed Charges and Earnings to Fixed
Charges Plus Preferred Dividend Requirements (Pre-Income Tax Basis) for
the latest calendar quarter subsequent to those set forth in (iv)
above, which if available shall be set forth in such letter; (viii)
reading the unaudited financial statements from which the amounts and
ratios described in (vii) above were derived and which will be attached
to such letter and agreeing the amounts therein to the Company's
accounting records; and (ix) making inquiries of certain officials of
the Company who have responsibility for financial and accounting
matters regarding whether the unaudited amounts and ratios referred to
in (vii) above and the unaudited financial statements referred to in
(viii) above are stated on a basis substantially consistent with that
of the corresponding audited amounts or ratios included or incorporated
by reference in the Final Supplemented Prospectus; and (D) reporting
their findings as a result of performing the limited procedures set
forth in (C) above. It is understood that the foregoing procedures 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 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP make no representations as to the
sufficiency of such procedures for the Underwriter's purposes.
(8) On the Closing Date, counsel for the Underwriter shall
have been furnished with such documents and opinions as it may
reasonably require for the purpose of enabling it 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
Underwriter and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP, counsel for the Underwriter.
(9) That no amendment or supplement to the Registration
Statement, the Preliminary Supplemented Prospectus or the Final
Supplemented Prospectus filed subsequent to the date of this Agreement
11
(including any filing made by the Company pursuant to Section 13 or 14
of the 1934 Act) shall be unsatisfactory in form to ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
LLP or shall contain information (other than with respect to an
amendment or supplement relating solely to the activity of the
Underwriter) which, in the reasonable judgment of the Underwriter,
shall materially impair the marketability of the Senior Notes.
(10) The Company shall have performed its obligations when and
as provided under this Agreement.
(11) Evidence that the Insurance Policy has been issued by the
Insurer and confirmation that the Senior Notes have been rated at least
Aaa by ▇▇▇▇▇'▇ Investors Services, Inc. and at least AAA by Standard &
Poor's Corporation.
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 Underwriter 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.
SECTION 6. CONDITIONS OF THE OBLIGATIONS OF THE COMPANY.
The obligations of the Company shall be subject to the
conditions set forth in the first sentence of Section 5(a) and in Section 5(b).
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
Underwriter. 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 the
Underwriter and each person, if any, who controls the Underwriter within the
meaning of Section 15 of the 1933 Act or Section 20(a) of the 1934 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 1933 Act, 1934 Act or
otherwise, and to reimburse the Underwriter 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 any Preliminary Prospectus, the
Registration Statement, the Prospectus, the Preliminary Supplemented Prospectus
or the Final Supplemented Prospectus or, if the Company shall furnish to the
Underwriter any amendments or any supplements thereto, or shall make any filings
pursuant to Section 13 or 14 of the 1934 Act which are incorporated therein by
reference, in any Preliminary Prospectus, the Registration Statement, the
Prospectus, the Preliminary Supplemented Prospectus or the Final Supplemented
12
Prospectus as so amended or supplemented, 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 Registration Statement,
Preliminary Prospectus, Prospectus, Preliminary Supplemented Prospectus or Final
Supplemented Prospectus in reliance upon and in conformity with information
furnished in writing to the Company by the Underwriter for use therein and
except that this indemnity with respect to the Preliminary Prospectus, the
Prospectus, the Preliminary Supplemented Prospectus or the Final Supplemented
Prospectus, if the Company shall have furnished any amendment or supplement
thereto, shall not inure to the benefit of the Underwriter (or of any person
controlling the Underwriter) 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 Preliminary Prospectus, the Prospectus, the Preliminary
Supplemented Prospectus or the Final Supplemented Prospectus (exclusive of
documents incorporated therein by reference pursuant to Item 12 of Form S-3), as
the same may then be amended or supplemented, shall not have been sent or given
by or on behalf of the Underwriter 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 Preliminary
Prospectus, the Prospectus, the Preliminary Supplemented Prospectus or the Final
Supplemented Prospectus as supplemented or amended at the time of such
confirmation. The Underwriter 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 account of
its agreement contained in this Section 7, to notify the Company in writing of
the commencement thereof but the omission of the Underwriter so to notify the
Company of any such action shall not release the Company from any liability
which it may have to the Underwriter 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 the Underwriter or any such person
controlling the Underwriter and the Underwriter 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, the Underwriter
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
the Underwriter 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
13
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) The Underwriter agrees to indemnify and hold harmless the
Company, its directors and such of its officers who have signed the Registration
Statement and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20(a) of the 1934 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 Registration Statement, the Preliminary Prospectus, the
Prospectus, the Preliminary Supplemented Prospectus or the Final Supplemented
Prospectus, or such documents as amended or supplemented, in reliance upon and
in conformity with information furnished in writing to the Company by the
Underwriter 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 the Underwriter or
controlling person, or by, or on behalf of the Company and shall survive
delivery of the Senior Notes to the Underwriter.
SECTION 9. TERMINATION OF AGREEMENT.
(a) The Underwriter 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,
(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 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 Underwriter, the marketability of the Senior
Notes shall have been materially impaired.
If this Agreement shall be terminated by the Underwriter
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
14
reimburse the Underwriter for the reasonable fees and disbursements of ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ LLP and for the out of pocket expenses (in an amount not exceeding
$10,000) reasonably incurred by the Underwriter in making preparations for the
purchase, sale and delivery of the Senior Notes and, upon such reimbursement,
the Company shall be absolved from any further liability hereunder, except as
provided in Sections 4 and 7.
SECTION 10. 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
Underwriter shall be directed to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P., ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Legal
Department; notices to the Company shall be mailed to ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Corporate Secretary,
with a copy to Southern Company Services, Inc., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇.
SECTION 11. PARTIES. This Agreement shall inure to the benefit
of and be binding upon the Underwriter, 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
Underwriter 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 Underwriter 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 the Underwriter shall be deemed
to be a successor by reason merely of such purchase.
SECTION 12. 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 13. 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.
15
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 Underwriter and the Company in accordance with its terms.
Very truly yours,
GULF POWER COMPANY
By: ______________________________
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & CO., L.P.
By:___________________________
Title:
Schedule II-A
[Letterhead of ▇▇▇▇▇ & ▇▇▇▇]
___________ __, 199_
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
GULF POWER COMPANY
Series A __ % Insured Quarterly Notes (IQ Notes)
Due June 30, 2038
Ladies and Gentlemen:
We have acted as general counsel to Gulf Power Company (the
"Company") in connection with (i) the Company's issuance of $______ aggregate
principal amount of its Series A __ % Insured Quarterly Notes due June 30, 2038
(the "Notes") pursuant to a Senior Note Indenture dated as of January 1, 1998,
by and between the Company and The Chase Manhattan ank, as trustee (the
"Trustee"), as supplemented by the First Supplemental Indenture dated as of
__________ __, 199_ (collectively, the "Indenture"); and (ii) the purchase by
you of the Notes pursuant to the terms of an Underwriting Agreement dated
_______, 1998, among the Company and you (the "Underwriter") (the "Underwriting
Agreement"). This opinion is being delivered to you pursuant to Section 5(c)(1)
thereof.
All capitalized terms not otherwise defined herein shall have
the meanings set forth in the Underwriting Agreement.
In rendering the opinions expressed below, we have examined
the registration statement on Form S-3 (Nos. 333-42033, ▇▇▇-▇▇▇▇▇-▇▇ and
333-42033-02) pertaining to the Notes (the "Registration Statement") filed under
the Securities Act of 1933, as amended (the "Act"), and the prospectus dated
________, 199_ as supplemented by a final prospectus supplement dated
__________, 199_ (the "Final Supplemented Prospectus"), which pursuant to Form
S-3 incorporates by reference the Annual Report on Form 10-K of the Company for
the fiscal year ended __________________, 199_, the Quarterly Reports on Form
10-Q of the Company for the quarters ended ____________ and the Current Reports
on Form 8-K of the Company dated __________ (the "Exchange Act Documents"), each
as filed under the Securities Exchange Act of 1934, as amended (the "Exchange
Act").
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 a specimen), and we have made such other and further
investigations as we deemed necessary to express the opinions hereinafter set
forth.
The Indenture and the Underwriting Agreement are herein
referred to as the "Agreements".
We have also examined the opinion of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP to
you of even date with respect to matters relating to the Securities Act of 1933,
as amended; the Securities Exchange Act of 1934, as amended; the Trust Indenture
Act of 1939, as amended and to the applicable rules and regulations of the
Commission under said Acts and in expressing the opinions stated herein, with
respect to such matters, we are relying on such opinion.
Based upon the foregoing, and subject to the qualifications
and limitations stated herein, we are of the opinion, relying as to matters of
Georgia law and the federal law of the United States upon the opinion dated the
date hereof rendered to you by ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP, and relying as to matters
of New York law upon the opinion dated the date hereof rendered to you by ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ 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 Maine, is duly
qualified to carry on its business as a foreign corporation under the laws of
the States of Florida, Georgia and Mississippi, and has due corporate authority
to carry on the public utility business in which it is engaged and to own and
operate the properties used by it in such business 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
Underwriting Agreement have been duly authorized by all necessary corporate
action, and the Underwriting Agreement has been duly executed and delivered by
the Company.
3. All orders, consents, or other authorizations or approvals of the
Florida Public Service Commission and the Commission legally required for the
issuance and sale of the Notes have been obtained; such orders are sufficient
for the issuance and the sale of the Notes; the issuance and the sale 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 any Florida 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 sale of the
Notes in accordance with the terms of the Underwriting 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 Final Supplemented Prospectus.
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 Underwriter pursuant to the Underwriting
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; and the Notes conform as to legal matters in all
material respects to the description thereof in the Final Supplemented
Prospectus.
6. The Indenture has been duly qualified under the Trust Indenture Act
of 1939, as amended (the "Trust Indenture Act").
We have not independently verified the accuracy, completeness
or fairness of the statements made or included in the Registration Statement,
the Final Supplemented Prospectus or the Exchange Act Documents and take no
responsibility therefor, except as and to the extent set forth in paragraphs 4
and 5 above and in the Final Supplemented Prospectus in the second paragraph
under the caption "Experts". In the course of the preparation by the Company of
the Registration Statement, the Final Supplemented Prospectus and the Exchange
Act Documents, we participated in conferences with certain officers and
employees of the Company, with other counsel for the Company and with
representatives of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP. Based upon our examination of the
Registration Statement, the Final Supplemented Prospectus and the Exchange Act
Documents, our investigations made in connection with the preparation of the
Registration Statement, the Final Supplemented Prospectus and the Exchange Act
Documents and our participation in the conferences referred to above, (i) we are
of the opinion that the Registration Statement, as of its effective date, and
the Final Supplemented Prospectus, as of __________, complied as to form in all
material respects with the requirements of the Act and the applicable rules and
regulations of the Commission thereunder and that the Exchange Act Documents, as
of their respective dates of filing with the Commission, complied as to form in
all material respects with the relevant requirements of the Exchange Act and the
applicable rules and regulations of the Commission thereunder, except that in
each case we express no opinion as to the financial statements or other
financial or statistical data contained or incorporated by reference in the
Registration Statement, the Final Supplemented Prospectus or the Exchange Act
Documents, and (ii) nothing came to our attention which gives us reason to
believe that the Registration Statement, as of the date of filing of the
3
Company's Annual Report on Form 10-K for the year ended December 31, 1997
(including the Exchange Act Documents on file with the Commission as of such
date), contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary in order to make the
statements therein not misleading, or that the Final Supplemented Prospectus
(including the Exchange Act Documents) contains any untrue statement therein of
a material fact or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except that in each case we express no opinion or belief
with respect to the financial statements or other financial or statistical data
contained or incorporated by reference in the Registration Statement, the Final
Supplemented Prospectus or the Exchange Act Documents and with respect to
information set forth in the Final Supplemented Prospectus under the captions
"Description of the Series A Senior Notes - Book-Entry Only Issuance - The
Depository Trust Company" and "The Policy and the Insurer."
We are members of the State Bar of Florida and we do not
express any opinion herein concerning any law other than the law of the States
of Florida and Mississippi and, to the extent set forth herein, the laws of the
States of Maine, Georgia and New York and the federal law of the United States.
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, except that ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP
may rely on this opinion in giving their opinions pursuant to the Underwriting
Agreement insofar as such opinion relates to matters of Florida and Mississippi
law.
Yours very truly,
▇▇▇▇▇ & ▇▇▇▇
4
Schedule II-B
[Letterhead of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP]
__________ __, 199_
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
GULF POWER COMPANY
Series A __ % SENIOR NOTES
Due June 30, 2038
Ladies and Gentlemen:
We have acted as counsel to Gulf Power Company (the "Company")
in connection with (i) the Company's issuance of $__________ aggregate principal
amount of its Series A __% Senior Notes due June 30, 2038 (the "Notes") pursuant
to a Senior Note Indenture dated as of January 1, 1998, by and between the
Company and The Chase Manhattan Bank, as trustee (the "Trustee"), as
supplemented by the First Supplemental Indenture dated as of __________ __, 199_
(collectively, the "Indenture"); and (ii) the purchase by you (the
"Underwriter") of the Notes pursuant to the terms of an Underwriting Agreement
dated __, 1998, among the Company and you (the "Underwriting Agreement"). This
opinion is being delivered to you pursuant to Section 5(c)(2) thereof.
All capitalized terms not otherwise defined herein shall have
the meanings set forth in the Underwriting Agreement.
In rendering the opinions expressed below, we have examined
the registration statement on Form S-3 (Nos. 333-42033, ▇▇▇-▇▇▇▇▇-▇▇ and
333-42033-02) pertaining to the Notes (the "Registration Statement") filed under
the Securities Act of 1933, as amended (the "Act"), and the prospectus dated
___________, 199_ as supplemented by a final prospectus supplement dated
__________, 199_ (the "Final Supplemented Prospectus"), which pursuant to Form
S-3 incorporates by reference the Annual Report on Form 10-K of the Company for
the fiscal year ended _____________, 199_, the Quarterly Reports on Form 10-Q of
the Company for the quarters ended ____________ and the Current Reports on Form
8-K of the Company dated _________ (the "Exchange Act Documents"), each as filed
under the Securities Exchange Act of 1934, as amended (the "Exchange Act").
In addition, we have examined, and have relied as to matters
of fact upon, the documents delivered to you at the closing (except the
certificates representing the Notes, of which we have examined a specimen), 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 and the Underwriting Agreement are herein
referred to collectively 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
Florida and Mississippi law upon the opinion dated the date hereof rendered to
you by ▇▇▇▇▇ & ▇▇▇▇, a Registered Limited Liability Partnership ("▇▇▇▇▇ &
▇▇▇▇"), and relying as to matters of New York law upon the opinion dated the
date hereof rendered to you by ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP, that:
1. The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Maine, is duly
qualified to carry on its business as a foreign corporation under the laws of
the States of Florida, Georgia and Mississippi and has due corporate authority
to carry on the public utility business in which it is engaged, to own and
operate the properties used by it in such business 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
Underwriting Agreement have been duly authorized by all necessary corporate
action, and the Underwriting Agreement has been duly executed and delivered by
the Company.
3. All orders, consents or other authorizations or approvals of the
Florida Public Service Commission and the Commission legally required for the
issuance and sale of the Notes have been obtained; such orders are sufficient
for the issuance and sale of the Notes; the issuance and sale 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 any Florida 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 sale of the
Notes in accordance with the terms of the Underwriting 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 Final Supplemented Prospectus.
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 Underwriter pursuant to the Underwriting
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 Final
Supplemented Prospectus.
6. The Indenture has been duly qualified under the Trust Indenture Act
of 1939, as amended.
We have not independently verified the accuracy, completeness
or fairness of the statements made or included in the Registration Statement,
the Final Supplemented Prospectus or the Exchange Act Documents and take no
responsibility therefor, except as and to the extent set forth in paragraphs 4
and 5 above. In the course of the preparation by the Company of the Registration
Statement, the Final Supplemented Prospectus and the Exchange Act Documents, we
participated in conferences with certain officers and employees of the Company,
with other counsel for the Company, with representatives of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP
and with your counsel. Based upon our examination of the Registration Statement,
the Final Supplemented Prospectus and the Exchange Act Documents, our
investigations made in connection with the preparation of the Registration
Statement, the Final Supplemented Prospectus and the Exchange Act Documents and
our participation in the conferences referred to above, (i) we are of the
opinion that the Registration Statement, as of its effective date, and the Final
Supplemented Prospectus, as of _______________, complied as to form in all
material respects with the requirements of the Act and the applicable rules and
regulations of the Commission thereunder and that the Exchange Act Documents, as
of their respective dates of filing with the Commission, complied as to form in
all material respects with the relevant requirements of the Exchange Act and the
applicable rules and regulations of the Commission thereunder, except that in
each case we express no opinion as to the financial statements or other
financial or statistical data contained or incorporated by reference in the
Registration Statement, the Final Supplemented Prospectus or the Exchange Act
Documents, and (ii) nothing came to our attention which gives us reason to
believe that the Registration Statement, as of the date of filing of the
Company's Annual Report on Form 10-K for the year ended December 31, 1997
(including the Exchange Act Documents on file with the Commission as of such
date), contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary in order to make the
statements therein not misleading, or that the Final Supplemented Prospectus
(including the Exchange Act Documents) contains any untrue statement of a
3
material fact or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except that in each case we express no opinion or belief
with respect to the financial statements or other financial or statistical data
contained or incorporated by reference in the Registration Statement, the Final
Supplemented Prospectus or the Exchange Act Documents and with respect to
information set forth in the Final Supplemented Prospectus under the captions
"Description of the Series A Senior Notes - Book-Entry Only Issuance - The
Depository Trust Company" and "The Policy and the Insurer."
We are members of the State Bar of Georgia and we do not
express any opinion herein concerning any law other than the law of the State of
Georgia and the federal law of the United States and, to the extent set forth
herein, the laws of the States of Maine, Florida, Mississippi and New York.
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, except that ▇▇▇▇▇ & ▇▇▇▇ may rely on this opinion in
giving their opinion pursuant to the Underwriting Agreement insofar as such
opinion relates to matters of Georgia law and the federal law of the United
States and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP may rely on this opinion in giving their opinion
pursuant to the Underwriting Agreement insofar as such opinion relates to
matters of Georgia law.
Yours very truly,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP
4
Schedule III
[Letterhead of Cravath, Swaine & ▇▇▇▇▇]
__________ __, 199_
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Gulf Power Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
MBIA Insurance Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Gulf Power Company
Series A __ % Senior Insured Quarterly Notes (IQ Notes) due June
30, 2038
Ladies and Gentlemen:
We have acted as counsel to The Chase Manhattan Bank (the
"Bank") in connection with (a) the Senior Note Indenture, dated as of January 1,
1998 (the "Original Indenture"), between Gulf Power Company (the "Company") and
the Bank, as Trustee, and (b) the First Supplemental Indenture dated as of
___________ (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;
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;
iii) the execution, delivery and performance by the Bank of
the Indenture does not conflict with or constitute a
breach of the charter or bylaws of the Bank; and
iv) no approval, authorization or other action by, or
filing with, any governmental authority of the United
States of America or the State of New York having
jurisdiction over the trust powers of the Bank is
required in connection with the execution and delivery
by the Bank of the Indenture or the performance by the
Bank of its duties thereunder, except such as have been
obtained, taken or made.
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,
CRAVATH, ▇▇▇▇▇▇ & ▇▇▇▇▇
Schedule IV
[Letterhead of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP]
__________ __, 199_
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
GULF POWER COMPANY
Series A __ % Insured Quarterly Notes (IQ Notes)
due June 30, 2038
Ladies and Gentlemen:
We have represented you (the "Underwriter") in connection with
(i) the issuance by Gulf Power Company (the "Company") of $____________ of its
Series A __ % Insured Quarterly Notes (IQ Notes) (the "Notes") pursuant to a
Senior Note Indenture dated as of January 1, 1998, by and between the Company
and The Chase Manhattan Bank, as trustee (the "Trustee"), as supplemented by the
First Supplemental Indenture dated as of __________ __, 199_ (collectively, the
"Indenture"); and (ii) the purchase by you of the Notes pursuant to the terms of
an Underwriting Agreement dated ________________, 1998, among the Company and
the Underwriter (the "Underwriting Agreement"). This opinion is being delivered
to you pursuant to Section 5(c)(4) thereof.
All capitalized terms not otherwise defined herein shall have
the meanings set forth in the Underwriting Agreement.
In rendering the opinions expressed below, we have examined
the registration statement on Form S-3 (Nos. 333-42033, ▇▇▇-▇▇▇▇▇-▇▇ and
333-42033-02) pertaining to the Notes (the "Registration Statement"), filed
under the Securities Act of 1933, as amended (the "Act"), and the prospectus
dated ________, 199_, as supplemented by a final prospectus supplement dated
_________, which pursuant to Form S-3 incorporates by reference the Annual
Report on Form 10-K of the Company for the fiscal year ended ________________,
199_, the Quarterly Reports on Form 10-Q of the Company for the quarters ended
_________ the Current Reports on Form 8-K of the Company, dated __________ (the
"Exchange Act Documents"), each as filed under the Securities Exchange Act of
1934, as amended (the "Exchange Act").
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 a specimen), 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 and the Underwriting 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 aforesaid and
as to all matters covered hereby which are governed by or dependent upon the
laws of the States of Florida and Mississippi upon the opinion of ▇▇▇▇▇ & ▇▇▇▇,
a Registered Limited Liability Partnership ("▇▇▇▇▇ & ▇▇▇▇"), dated the date
hereof and addressed to you and as to all matters covered hereby which are
governed by or dependent upon the laws of the State of Georgia upon the opinion
of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP dated the date hereof and addressed to you, that:
1. The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of Maine,
is duly qualified to carry on its business as a foreign corporation in the
States of Florida, Georgia and Mississippi, and has due corporate authority to
carry on the public utility business in which it is engaged and to own and
operate the properties used by it in such business 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 Underwriting Agreement have been duly authorized by all necessary corporate
action, and the Underwriting Agreement has been duly executed and delivered by
the Company.
3. All orders, consents, or other authorizations or approvals
of the Florida Public Service Commission and the Commission legally required for
the issuance and sale of the Notes have been obtained; such orders are
sufficient for the issuance and sale of the Notes; the issuance and sale 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 any Florida 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 sale of the
Notes in accordance with the terms of the Underwriting 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 Final Supplemented
Prospectus.
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 Underwriter pursuant to the
Underwriting 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 Final
Supplemented Prospectus.
6. The Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended.
We have not independently verified the accuracy, completeness
or fairness of the statements made or included in the Registration Statement,
the Final Supplemented Prospectus or the Exchange Act Documents and take no
responsibility therefor, except as and to the extent set forth in paragraphs 4
and 5 above. In the course of the preparation by the Company of the Registration
Statement, the Final Supplemented Prospectus and the Exchange Act Documents, we
participated in conferences with certain officers and employees of the Company,
with representatives of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP and with counsel to the Company.
Based upon our examination of the Registration Statement, the Final Supplemented
Prospectus and the Exchange Act Documents, our investigations made in connection
with the preparation of the Registration Statement and the Final Supplemented
Prospectus and our participation in the conferences referred to above, (i) we
are of the opinion that the Registration Statement, as of its effective date,
and the Final Supplemented Prospectus, as of ___________, complied as to form in
all material respects with the requirements of the Act and the applicable rules
and regulations of the Commission thereunder and that the Exchange Act
Documents, as of their respective dates of filing with the Commission, complied
as to form in all material respects with the relevant requirements of the
Exchange Act and the applicable rules and regulations of the Commission
thereunder, except that in each case we express no opinion as to the financial
statements or other financial or statistical data contained or incorporated by
reference in the Registration Statement, the Final Supplemented Prospectus or
the Exchange Act Documents, and (ii) nothing came to our attention which gives
us reason to believe that the Registration Statement, as of the date of filing
of the Company's Annual Report on Form 10-K for the year ended December 31, 1997
(including the Exchange Act Documents on file with the Commission as of such
date), contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary in order to make the
statements therein not misleading, or that the Final Supplemented Prospectus
(including the Exchange Act Documents) contains any untrue statement of a
material fact or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except that in each case we express no opinion or belief
with respect to the financial statements or other financial or statistical data
contained or incorporated by reference in the Registration Statement, the Final
Supplemented Prospectus or the Exchange Act Documents and with respect to
information set forth in the Final Supplemented Prospectus under the captions
"Description of the Series A Senior Notes - Book-Entry Only Issuance - The
Depository Trust Company" and "The Policy and the Insurer."
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 to the extent set forth
herein, the law of the States of Maine, Florida, Mississippi and Georgia.
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 ▇▇▇▇▇ & ▇▇▇▇ and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP may rely on this
opinion in giving their opinions pursuant to Section 5 of the Underwriting
Agreement, insofar as such opinions relate to matters of New York law, and
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP may rely on this opinion in giving its opinion pursuant to
Sections 102, 302 and 904 of the Indenture, insofar as such opinion relates to
matters of New York law.
Very truly yours,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP
Schedule V
[Letterhead of Insurer's counsel]
__________ __, 199_
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
GULF POWER COMPANY
Series A __ % Insured Quarterly Notes (IQ Notes)
due June 30, 2038
Ladies and Gentlemen:
This opinion has been requested in connection with the
issuance by MBIA Insurance Corporation (the "Insurer") of a certain Financial
Guaranty Insurance Policy, effective as of the date hereof (the "Policy"),
insuring $50,000,000 in aggregate principal amount of Gulf Power Company (the
"Issuer") Series A __% Insured Quarterly Notes due June 30, 2038 (the
"Obligations").
In connection with my opinion herein, we have examined the
Policy, such statutes, documents and proceedings as we have considered necessary
or appropriate under the circumstances to render the following opinion,
including, without limiting the generality of the foregoing, certain statements
contained in the Prospectus Supplement dated June __, 1998 to the Prospectus of
the Issuer dated December 30, 1998, relating to the Obligations (the "Prospectus
Supplement") under the headings "The Policy and The Insurer" and "Appendix A -
Form of Policy."
Based upon the foregoing and having regard to legal
considerations we deem relevant, we are of the opinion that:
1. The Insurer is a stock insurance company duly organized and
validly existing under the laws of the State of New York and
licenses and authorized to issue the Policy under the laws of
the State of New York.
2. The Insurer has full corporate power and authority to
execute and deliver the Policy and the Policy has been duly
authorized, executed and delivered by The Insurer and
constitutes a legal, valid and binding obligation of The
Insurer enforceable in accordance with its terms except
to the extent that the enforceability (but not the
validity) of such obligation may be limited by any
applicable bankruptcy, insolvency reorganization,
moratorium, receivership and other similar laws
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).
3. The Policy is not required to be registered under the
Securities Act of 1933, as amended.
4. The statements contained in the Prospectus Supplement under
the heading "The Policy and The Insurer", insofar as such
statements constitutes summaries of the matters referred to
therein, accurately reflect and fairly present the information
purported to be shown and, insofar as such statements describe
The Insurer, fairly and accurately describe The Insurer. The
form of Policy contained in the Prospectus Supplement under
the heading "Appendix A - Form of Policy" is a true and
complete copy of the form of Policy.
Very truly yours,