Exhibit 1
$75,000,000 Series D 6.10% Senior Notes
due September 30, 2016
GULF POWER COMPANY
UNDERWRITING AGREEMENT
October 5, 2001
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Gulf Power Company, a Maine corporation (the "Company"),
confirms its agreement (the "Agreement") with ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc., acting
as the representative (the "Representative") of the underwriters named in
Schedule I hereto (the "Underwriters", which term shall also include any
underwriter substituted as hereinafter provided in Section 10 hereof), with
respect to the sale by the Company and the purchase by the Underwriters, acting
severally and not jointly, of $75,000,000 principal amount of the Series D 6.10%
Senior Notes due September 30, 2016 (the "Senior Notes") as set forth in
Schedule I hereto.
The Company understands that the Underwriters propose to make
a public offering of the Senior Notes as soon as the Underwriters deem 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"), by and between the Company and The Chase Manhattan Bank, as trustee
(the "Trustee"), as heretofore supplemented and amended and as to be further
supplemented and amended by a fourth supplemental indenture, dated as of October
18, 2001, 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
Underwriters as follows:
(a) A registration statement on Form S-3, as amended (File
Nos. 333-59942, ▇▇▇-▇▇▇▇▇-▇▇ and 333-59942-02), 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 Underwriters,
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
Underwriters 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; 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 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
Underwriters 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
Underwriters expressly for use in the Final Supplemented
Prospectus; or (B) any information set forth in the Final
Supplemented Prospectus under the captions "Description of
the Series D Senior Notes - Book-Entry Only Issuance -- The
Depository Trust Company" and "The Policy and the Insurer"
or in Appendix A thereto.
(c) The Registration Statement, the Prospectus 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, and (ii)
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 or the Final Supplemented Prospectus in reliance
upon and in conformity with information furnished in writing
to the Company by the Underwriters expressly for use therein
or (C) any information set forth in the Final Supplemented
Prospectus under the captions "Description of the Series D
Senior Notes - Book-Entry Only Issuance -- The Depository
Trust Company" and "The Policy and the Insurer" or in
Appendix A thereto.
(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.
(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
Underwriters.
(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 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 Ambac Assurance 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; (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 UNDERWRITERS;
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 each Underwriter, and
each Underwriter, severally and not jointly, agrees to purchase
from the Company, the principal amount of Senior Notes set forth
in Schedule I to this Agreement opposite the name of such
Underwriter (plus any additional amount of Senior Notes that such
Underwriter may become obligated to purchase pursuant to the
provisions of Section 10 hereof), at a price equal to 97.65% of
the principal amount thereof.
(b) Payment for and delivery of certificates for the Senior
Notes shall be made at the offices of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP, Bank
of America Plaza, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ at
10:00 A.M., Atlanta time, on October 18, 2001 (unless postponed
in accordance with the provisions of Section 10) or such other
time, place or date as shall be agreed upon by the Underwriters
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 Representative. It is
understood that each Underwriter has authorized the
Representative, for its account, to accept delivery of, receipt
for, and make payment of the principal amount of the Senior Notes
which it has agreed to purchase. The Representative, individually
and not as Representative of the Underwriters, may (but shall not
be obligated to) make
payment of the principal amount of the Senior Notes to be
purchased by any Underwriter whose payment has not been received
by the Closing Date, but such payment shall not relieve such
Underwriter from its obligations hereunder.
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 Underwriters shall accept such delivery.
The certificate(s) for the Senior Notes will be made
available for examination by the Underwriters 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 Underwriters as follows:
(a) The Company, on or prior to the Closing Date, will deliver to
the Underwriters 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 Representative 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 Representative sufficient
conformed copies of the Registration Statement, the Prospectus
and the Final Supplemented Prospectus and of all supplements and
amendments thereto (in each case without exhibits) for
distribution to the Underwriters and, from time to time, as many
copies of the Prospectus and the Final Supplemented Prospectus as
the Underwriters may reasonably request for the purposes
contemplated by the 1933 Act or the ▇▇▇▇ ▇▇▇.
(b) The Company will furnish the Underwriters with copies of each
amendment and supplement to the Final Supplemented Prospectus
relating to the offering of the Senior Notes in such quantities
as the Underwriters 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 an Underwriter, any event relating to
or affecting the Company, or of which the Company shall be
advised in writing by the Underwriters, shall occur, which in the
opinion of the Company or of Underwriters' counsel should be set
forth in a supplement to or an amendment of the Final
Supplemented Prospectus, as the case may be, in order to make the
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
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 Underwriters to
suspend solicitation of purchases of the Senior Notes and (ii) at
its expense, make any such filing or prepare and furnish to the
Underwriters a reasonable number of copies of a supplement or
supplements or an amendment or amendments to the Final
Supplemented Prospectus which will supplement or amend 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
Final Supplemented Prospectus is delivered, not misleading or
which will effect any other necessary compliance. In case any
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 such Underwriter, will furnish to such Underwriter, at
the expense of such 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 Underwriters and ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ LLP.
(c) The Company will endeavor, in cooperation with the
Underwriters, 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 Underwriters 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 ▇▇▇▇ ▇▇▇) 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.
(e) During a period of 15 days from the date of this Agreement,
the Company will not, without the Underwriters' 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 Representative 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 Underwriters 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 Underwriters of
copies of the Registration Statement as originally filed and of each
amendment thereto and of the Prospectus, the Final Supplemented
Prospectus, and any amendments or supplements thereto, (vi) the
printing and delivery to the Underwriters 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
Underwriters shall pay all other expenses incurred by them in
connection with their offering of the Senior Notes including fees and
disbursements of their counsel, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP.
SECTION 5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The
obligations of the Underwriters to purchase and
pay for the Senior Notes are subject to the
following conditions:
(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 Final Supplemented Prospectus, or any
supplement thereto, is required pursuant to Rule 424, 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 Florida Commission and 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 Underwriters or the Company (but all
provisions of such order or orders heretofore entered, copies of
which have heretofore been delivered to the Underwriters, are
deemed acceptable to the Underwriters and the Company and all
provisions of such order or orders hereafter entered shall be
deemed acceptable to the Underwriters 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 Underwriters shall have received:
(1) The opinion, dated the Closing Date, of ▇▇▇▇▇ & Lane, 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 Cravath, Swaine &
▇▇▇▇▇, counsel to the Trustee, substantially in the form attached
hereto as Schedule III.
(4) The opinion, dated the Closing Date, of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP,
counsel for the Underwriters, 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 Underwriters shall have received
a certificate of the President or any Vice President of the Company,
and 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 Underwriters 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 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 1934 Act and the
rules and regulations under the 1934 Act; and (C) on the basis of
certain limited procedures performed through a specified date not more
than five business days prior to the date of such letter, namely (i)
reading the minute books of the Company; (ii) performing the
procedures specified by the American Institute of Certified Public
Accountants ("AICPA") for a review of interim financial information as
described in Statement on Auditing Standards No. 71, "Interim
Financial Information", on the unaudited financial statements, if any,
of the Company incorporated in the Final Supplemented Prospectus and
of the latest available unaudited financial statements of the Company,
if any, for any calendar quarter subsequent to the date of those
incorporated in the Final Supplemented Prospectus; and (iii) making
inquiries of certain officials of the Company who have responsibility
for financial and accounting matters regarding such unaudited
financial statements or any specified unaudited amounts derived
therefrom (it being understood that the foregoing 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 Underwriters' purposes),
nothing came to their attention that caused them to believe that: (1)
any material modifications should be made to the unaudited condensed
financial statements, if any, incorporated in the Final Supplemented
Prospectus, for them to be in conformity with generally accepted
accounting principles; (2) such unaudited condensed financial
statements do not comply as to form in all material respects with the
applicable accounting requirements of the 1934 Act as it applies to
Form 10-Q and the related published rules and regulations thereunder;
(3) the unaudited amounts for Operating Revenues, Earnings Before
Interest and Income Taxes and Net Income After Dividends on Preferred
Stock and the unaudited Ratio of Earnings to Fixed Charges set forth
in the Final Supplemented Prospectus do not agree with the amounts set
forth in or derived from the unaudited financial statements for the
same period or were not determined on a basis substantially consistent
with that of the corresponding audited amounts or ratios included or
incorporated by reference in Registration Statement; (4) as of a
specified date not more than five business days prior to the date of
delivery of such letter, there has been any change in the capital
stock or long-term debt of the Company or any decrease in net assets
as compared with amounts shown in the latest audited balance sheet
incorporated in the Final Supplemented 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; and (5) the
unaudited amounts for Operating Revenues, Earnings Before Interest and
Income Taxes and Net Income After Dividends on Preferred Stock and the
unaudited Ratio of Earnings to Fixed Charges for any calendar quarter
subsequent to those set forth in (3) above, which if available shall
be set forth in such letter, do not agree with the amounts set forth
in or derived from the unaudited financial statements for the same
period or were not determined on a basis substantially consistent with
that of the corresponding audited amounts or ratios included or
incorporated by reference in the Final Supplemented Prospectus.
(8) On the Closing Date, counsel for the Underwriters 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
Underwriters and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP, counsel for the Underwriters.
(9) That no amendment or supplement to the Registration Statement
or the Final Supplemented Prospectus filed subsequent to the date of
this Agreement (including any filing made by the Company pursuant to
Section 13 or 14 of the ▇▇▇▇ ▇▇▇) 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 Underwriters) which, in the reasonable judgment of the
Representative, 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 ▇▇▇▇▇'▇ Investor Services, Inc. and at least AAA by
Standard & Poor's Ratings Services, a Division of The ▇▇▇▇▇▇-▇▇▇▇
Companies.
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 Underwriters 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
Underwriters. Any such termination shall be without liability of any party to
any other party except as otherwise provided in Sections 4, 7 and 9(b) hereof.
SECTION 7. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless each of the
Underwriters and each person, if any, who controls any such 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 any such 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 or the Final Supplemented Prospectus or,
if the Company shall furnish to the Underwriters 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 or the Final Supplemented
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 or Final Supplemented Prospectus in reliance
upon and in conformity with information furnished in writing to the Company by
the Underwriters for use therein and except that this indemnity with respect to
the Preliminary Prospectus, the Prospectus or the Final Supplemented Prospectus,
if the Company shall have furnished any amendment or supplement thereto, shall
not inure to the benefit of any Underwriter (or of any person controlling such
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 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 such 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 or the Final Supplemented Prospectus as
supplemented or amended at the time of such confirmation. Each 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 such Underwriter so to notify the Company of any such action shall
not release the Company from any liability which it may have to such 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 an Underwriter or any such person controlling such Underwriter and such
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, any 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 such 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 party. In no event shall any
indemnifying party have any liability or responsibility in respect of the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim effected without its prior
written consent.
(b) Each Underwriter agrees severally and not jointly, 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 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 such 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 any Underwriter or
controlling person, or by, or on behalf of the Company and shall survive
delivery of the Senior Notes to the Underwriters.
SECTION 9. TERMINATION OF AGREEMENT.
(a) The Representative 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 Representative, the marketability of the Senior
Notes shall have been materially impaired.
(b) If this Agreement shall be terminated by the Representative
pursuant to subsection (a) above or because of any failure or refusal on
the part of the Company to comply with the terms or to fulfill any of the
conditions of this Agreement, or if for any reason the Company shall be
unable to perform its obligations under this Agreement, then in any such
case, the Company will reimburse the Underwriters 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
Underwriters 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. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS
If one or more of the Underwriters shall fail on the Closing
Date to purchase the Senior Notes that it or they are obligated to purchase
under this Agreement (the "Defaulted Securities"), the non-defaulting
Underwriters shall have the right, within 24 hours thereafter, to make
arrangements for one or more of the non-defaulting Underwriters, or any other
underwriters, to purchase all, but not less than all, of the Defaulted
Securities in such amounts as may be agreed upon and upon the terms herein set
forth. If, however, the non-defaulting Underwriters shall not have completed
such arrangements within such 24-hour period, then:
(a) if the principal amount of Defaulted Securities does not exceed
10% of the Senior Notes, each of the non-defaulting Underwriters shall be
obligated, severally and not jointly, to purchase the full amount thereof
in the proportions that their respective underwriting obligations hereunder
bear to the underwriting obligations of all non-defaulting Underwriters, or
(b) if the principal amount of Defaulted Securities exceeds 10% of the
Senior Notes, this Agreement shall terminate without liability on the part
of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement, either the non-defaulting Underwriters or the
Company shall have the right to postpone the Closing Date for a period not
exceeding seven days in order to effect any required changes in the Registration
Statement or Final Supplemented Prospectus or in any other documents or
arrangements.
SECTION 11. NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given
if mailed or transmitted by any standard form of telecommunication. Notices
to the Underwriters shall be directed to ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc., ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Debt Syndicate
Desk; notices to the Company shall be mailed to ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Corporate Secretary, with a copy to Southern
Company Services, Inc., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇.
SECTION 12. PARTIES. This Agreement shall inure to the
benefit of and be binding upon the Underwriters, 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 Underwriters 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 Underwriters 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 Underwriters shall be deemed to be a successor by reason merely
of such purchase.
SECTION 13. GOVERNING LAW AND TIME. This Agreement shall be
governed by and construed in accordance with the laws of the State of New
York applicable to agreements made and to be performed in said State. Except
as otherwise set forth herein, specified times of day refer to New York City
time.
SECTION 14. COUNTERPARTS. This Agreement may be executed by
any one or more of the parties hereto in any number of counterparts, each
of which shall be deemed to be an original, but all such respective
counterparts shall together constitute one and the same instrument.
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 Underwriters 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
▇.▇. ▇▇▇▇▇▇▇ & SONS, INC.
as Representative of the Underwriters
By:___________________________
Title:
SCHEDULE I
Principal Amount of
NAME OF UNDERWRITER Senior Notes
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. $25,000,000
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P. 25,000,000
Wachovia Securities, Inc. 25,000,000
TOTAL $75,000,000
Schedule II-A
[Letterhead of ▇▇▇▇▇ & ▇▇▇▇]
__________, 2001
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.
Wachovia Securities, Inc.
c/o ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
GULF POWER COMPANY
Series D ____% Senior Notes
due September 30, 2016
Ladies and Gentlemen:
We have acted as general counsel to Gulf Power Company (the
"Company") in connection with (i) the Company's issuance of $75,000,000
aggregate principal amount of its Series D ______% Senior Notes due September
30, 2016 (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 heretofore supplemented and as further supplemented by the
Fourth Supplemental Indenture dated as of __________, 2001 (collectively, the
"Indenture"); and (ii) the purchase by you of the Notes pursuant to the terms of
an Underwriting Agreement dated _______, 2001, among the Company and you (the
"Underwriters") (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-_____, 333-______and
333-______) pertaining to the Notes (the "Registration Statement") filed under
the Securities Act of 1933, as amended (the "Act"), and the prospectus dated
________, 2001 as supplemented by a final prospectus supplement dated
__________, 2001 (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 December 31, 2000, 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 Act, the Exchange Act,
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 Underwriters 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. 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 its effective date (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 D Senior Notes - Book-Entry Only Issuance - The
Depository Trust Company" and "The Policy and the Insurer" or in Appendix A
thereto.
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 opinions relate to matters of Florida and Mississippi
law.
Yours very truly,
▇▇▇▇▇ & ▇▇▇▇
Schedule II-B
[Letterhead of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP]
__________, 2001
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.
Wachovia Securities, Inc.
c/o ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
GULF POWER COMPANY
Series D ____% Senior Notes
due September 30, 2016
Ladies and Gentlemen:
We have acted as counsel to Gulf Power Company (the "Company")
in connection with (i) the Company's issuance of $75,000,000 aggregate principal
amount of its Series D _____% Senior Notes due September 30, 2016 (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
heretofore supplemented and as further supplemented by the Fourth Supplemental
Indenture dated as of ________, 2001 (collectively, the "Indenture"); and (ii)
the purchase by you of the Notes pursuant to the terms of an Underwriting
Agreement dated _____, 2001 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-_____, 333-______and 333-______
) pertaining to the Notes (the "Registration Statement") filed under the
Securities Act of 1933, as amended (the "Act"), and the prospectus dated
___________, 2001 as supplemented by a final prospectus supplement dated
__________, 2001 (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 December, 31, 2000, 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, other than those of the Company, 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 ("▇▇▇▇▇ &
Lane"), 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 Underwriters 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 its effective date (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 D Senior Notes - Book-Entry Only Issuance - The
Depository Trust Company" and "The Policy and the Insurer" or in Appendix A
thereto.
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 ▇▇▇▇▇ & Lane may rely on this opinion in
giving its 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 its opinion
pursuant to the Underwriting Agreement insofar as such opinion relates to
matters of Georgia law.
Yours very truly,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP
Schedule III
[Letterhead of Cravath, Swaine & ▇▇▇▇▇]
__________ __, 2001
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.
Wachovia Securities, Inc.
c/o ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Gulf Power Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Ambac Assurance Corporation
▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Gulf Power Company
Series D ____% Senior Notes
due September 30, 2016
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 as heretofore supplemented (the "Original Indenture"), between Gulf Power
Company (the "Company") and the Bank, as Trustee, and (b) the Fourth
Supplemental Indenture dated as of October , 2001 (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 do 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, SWAINE & ▇▇▇▇▇
Schedule IV
[Letterhead of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP]
__________ __, 2001
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.
Wachovia Securities, Inc.
c/o ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
GULF POWER COMPANY
Series D ____% Senior Notes
due September 30, 2016
Ladies and Gentlemen:
We have represented you (the "Underwriters") in connection
with (i) the issuance by Gulf Power Company (the "Company") of $75,000,000 of
its Series D _____% Senior 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 heretofore supplemented and as
further supplemented by the Fourth Supplemental Indenture dated as of __________
__, 2001 (collectively, the "Indenture"); and (ii) the purchase by you of the
Notes pursuant to the terms of an Underwriting Agreement dated ________________,
2001, among the Company and the Underwriters (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-_____, 333-_____ and 333-______
) pertaining to the Notes (the "Registration Statement"), filed under the
Securities Act of 1933, as amended (the "Act"), and the prospectus dated
________, 2001, 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 December 31, 2000,
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. 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 ("▇▇▇▇▇ & Lane"), 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 Underwriters 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 its effective date
(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 D Senior Notes - Book-Entry Only Issuance - The
Depository Trust Company" and "The Policy and the Insurer" or in Appendix A
thereto.
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 ▇▇▇▇▇ & Lane 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]
__, 2001
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.
Wachovia Securities, Inc.
c/o ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
GULF POWER COMPANY
Series D ____ % Senior Notes
Due September 30, 2016
Ladies and Gentlemen:
This opinion has been requested of the undersigned, a Vice
President and an Assistant General Counsel of Ambac Assurance Corporation, a
Wisconsin stock insurance company ("Ambac Assurance"), in connection with the
issuance by Ambac Assurance of a certain Financial Guaranty Insurance Policy and
endorsement thereto, effective as of the date hereof (the "Policy"), insuring
$75,000,000 in aggregate principal amount of the Gulf Power Company (the
"Issuer") Series D _% Senior Notes due September 30, 2016 (the "Senior Notes").
In connection with my opinion herein, I have examined the
Policy, such statutes, documents and proceedings as I 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 __, 2001 to the Prospectus of the
Issuer dated __, 199_ 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 I deem relevant, I am of the opinion that:
1. Ambac Assurance is a stock insurance company duly organized
and validly existing under the laws of the State of Wisconsin
and duly qualified to conduct an insurance business in the
State of Mississippi.
2. Ambac Assurance has full corporate power and authority to
execute and deliver the Policy and the Policy has been duly
authorized, executed and delivered by Ambac Assurance and
constitutes a legal, valid and binding obligation of Ambac
Assurance 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, liquidation, rehabilitation or other similar law
or enactment now or hereafter enacted affecting the
enforcement of creditors' rights.
3. The execution and delivery by Ambac Assurance of the Policy
will not, and the consummation of the transactions
contemplated thereby and the satisfaction of the terms thereof
will not, conflict with or result in a breach of any of the
terms, conditions or provisions of the Certificate of
Authority, Articles of Incorporation or By-Laws of Ambac
Assurance, or any restriction contained in any contract,
agreement or instrument to which Ambac Assurance is party or
by which it is bound or constitute a default under any of the
foregoing.
4. Proceedings legally required for the issuance of the Policy
have been taken by Ambac Assurance and licenses, orders,
consents or other authorizations or approvals of any
governmental boards or bodies legally required for the
enforceability of the Policy have been obtained; any
proceedings not taken and any licenses, authorizations or
approvals not obtained are not material to the enforceability
of the Policy.
5. 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
Ambac Assurance, fairly and accurately describe Ambac
Assurance. 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,
Vice President and
Assistant General Counsel