Exhibit 10(a)3

SOUTHERN COMPANY

OMNIBUS INCENTIVE COMPENSATION PLAN

2006 AWARD AGREEMENT

 

Your Options are subject to the following terms and conditions:

1.

Grant: The Southern Company (the “Company”) Compensation and Management
Succession Committee (the “Committee”) has granted you nonqualified stock
options (the “Options”) to purchase shares of Southern Company common stock
(“Common Stock”). This award is governed by the Southern Company Omnibus
Incentive Compensation Plan, as amended from time to time (the “Plan”).

2.

Terms: Terms used in this Award Agreement that are defined in the Plan will have
the meanings ascribed to them in the Plan. If there is any inconsistency between
the terms of this Award Agreement and the terms of the Plan, the Plan’s terms
will supersede and replace the conflicting terms of this Award Agreement.

3.

Grant Date, Number of Shares and Grant Price: The Grant Date of your Options,
number of shares granted to you under your Options and the Grant Price (also
referred to as the Exercise Price) are set forth on the UBS Financial Services
Inc. website at https://onesource.ubs.com/so.

4.

Option Term: The Options have been granted for a period of ten (10) years from
the Grant Date (the “Option Term”).

5.

Vesting and Exercise: Options do not provide you with any rights or interests
until they vest (become exercisable). One-third of the shares granted under the
Options shall vest on each one year anniversary of the Grant Date.

6.

How to Exercise: You may exercise an Option by entering and executing an
exercise order with UBS Financial Services Inc. and obtaining an exercise
confirmation. UBS Financial Services Inc. may be reached by telephone at
404-760-3312 or 1-866-4SO-OPTION (1-866-476-6784) or on the UBS Financial
Services Inc. website at https://onesource.ubs.com/so. Payment for shares you
elect to purchase may be made in cash or in any other form of payment allowed by
the Company. Should you decide to purchase Common Stock pursuant to the exercise
of an Option with previously purchased Common Stock (if allowed), any such
Common Stock used as payment will be valued at its Fair Market Value as of the
date of exercise of the Option.

 

 

1

 

 

 

7.

Impact of Termination of Employment

The vesting and term of any Options will change if you terminate employment,
according to the following table:

Termination of Employment Event

Impact
on Unvested Options

Exercise Period for Vested Options (But in No Event Beyond the Original Option
Term )

 

 

 

Disability 1

Vest fully

3 years

Retirement 2

Vest fully

5 years

Death

Vest fully

3 years

Any other type of termination not for cause3

Forfeited

90 days

Any termination for cause3/4

Forfeited

Forfeited

 

 

 

 

1Disability means any physical or mental condition which would qualify you for a
disability benefit under the long-term disability plan maintained by the Company
and applicable to you, or if no such disability plan exists, as determined by
the Committee.

2Retirement means any retirement under the Southern Company Pension Plan. If you
die within the 5-year period for exercise after the date of your termination,
your executor will have 3 years from the date of your death to exercise (subject
to the expiration of the original 10-year term of the Option).

3Cause is determined by the Committee.

4Any termination for cause includes any type of termination (including, but not
limited to, a voluntary or involuntary resignation by you, a voluntary or
involuntary termination by the Company, your termination with severance, your
retirement, or your termination because of a disability) if such termination is
related to cause.

 

Options that are not and do not become exercisable at the time of your
termination of employment will, coincident therewith, terminate and be of no
force or effect.

8.

Transferability: Options are not transferable except by will or the laws of
descent and distribution and may be exercised during your life only by you or,
following your death or disability if any Options are still exercisable, by your
duly appointed guardian or other legal representative.

Notwithstanding the above, if you are a designated “executive officer”, as that
term is defined in Rule 3b-7 of the Securities Exchange Act of 1934, of Southern
Company (but not of a Southern Company subsidiary) at the time of transfer (or,
if your employment has terminated at the time of transfer, at the time of your
termination), Options may be transferred to your immediate family (spouse,
children, or grandchildren), a trust for the benefit of your immediate family,
or a partnership or limited liability company whose only partners or members are
you or your immediate family (any such recipient to be referred to as a
“Transferee”), provided such transfer is one which is not treated as a taxable
sale or exchange of the Option for federal income tax purposes. Subsequent
transfer or assignment by a Transferee is prohibited and any such attempt will
be disregarded as void. Please provide prior notice of any transfer to the
Senior Vice President HR Services. Transfers incident to a divorce are not
allowed.

 

 

2

 

 

 

9.

Other Terms and Conditions. The Design Details, an administrative document
adopted by the Committee which is set forth on the UBS Financial Services Inc.
website at https://onesource.ubs.com/so, contains additional provisions that
apply to the Options. Additionally, the Options are subject to all of the terms
and conditions set forth in the Plan and any other administrative documents
adopted by the Committee. By exercising any portion of the Options, you agree to
be subject to all of the terms and conditions of this Award Agreement.
Additionally, you agree to be subject to all of the terms and conditions of the
Plan, the Design Details, and any other administrative documents, as amended
from time to time.

10.

Additional Information: Please refer any questions you may have regarding these
Options to UBS Financial Services Inc. at 404-760-3312 or 1-866-4SO-OPTION or HR
Direct at 1-888-678-6787.

 

3

 

 

 

SOUTHERN COMPANY

OMNIBUS INCENTIVE COMPENSATION PLAN

2006 AWARD AGREEMENT

 

Your Options are subject to the following terms and conditions:

1.

Grant: The Southern Company (the “Company”) Compensation and Management
Succession Committee (the “Committee”) has granted you nonqualified stock
options (the “Options”) to purchase shares of Southern Company common stock
(“Common Stock”). This award is governed by the Southern Company Omnibus
Incentive Compensation Plan, as amended from time to time (the “Plan”).

2.

Terms: Terms used in this Award Agreement that are defined in the Plan will have
the meanings ascribed to them in the Plan. If there is any inconsistency between
the terms of this Award Agreement and the terms of the Plan, the Plan’s terms
will supersede and replace the conflicting terms of this Award Agreement.

3.

Grant Date, Number of Shares and Grant Price: The Grant Date of your Options,
number of shares granted to you under your Options and the Grant Price (also
referred to as the Exercise Price) are set forth on the UBS Financial Services
Inc. website at https://onesource.ubs.com/so.

4.

Option Term: The Options have been granted for a period of ten (10) years from
the Grant Date (the “Option Term”).

5.

Vesting and Exercise: Options do not provide you with any rights or interests
until they vest (become exercisable). One-third of the shares granted under the
Options shall vest on each one year anniversary of the Grant Date.

6.

How to Exercise: You may exercise an Option by entering and executing an
exercise order with UBS Financial Services Inc. and obtaining an exercise
confirmation. UBS Financial Services Inc. may be reached by telephone at
404-760-3312 or 1-866-4SO-OPTION (1-866-476-6784) or on the UBS Financial
Services Inc. website at https://onesource.ubs.com/so. Payment for shares you
elect to purchase may be made in cash or in any other form of payment allowed by
the Company. Should you decide to purchase Common Stock pursuant to the exercise
of an Option with previously purchased Common Stock (if allowed), any such
Common Stock used as payment will be valued at its Fair Market Value as of the
date of exercise of the Option.

7.

Impact of Termination of Employment

The vesting and term of any Options will change if you terminate employment,
according to the following table:

 

 

1

 

 

 

 

Termination of Employment Event

Impact
on Unvested Options

Exercise Period for Vested Options (But in No Event Beyond the Original Option
Term )

 

 

 

Disability 1

Vest fully

3 years

Retirement 2

Vest fully

5 years

Death

Vest fully

3 years

Any other type of termination not for cause3

Forfeited

90 days

Any termination for cause3/4

Forfeited

Forfeited

 

 

 

 

1Disability means any physical or mental condition which would qualify you for a
disability benefit under the long-term disability plan maintained by the Company
and applicable to you, or if no such disability plan exists, as determined by
the Committee.

2Retirement means any retirement under the Southern Company Pension Plan. If you
die within the 5-year period for exercise after the date of your termination,
your executor will have 3 years from the date of your death to exercise (subject
to the expiration of the original 10-year term of the Option).

3Cause is determined by the Committee.

4Any termination for cause includes any type of termination (including, but not
limited to, a voluntary or involuntary resignation by you, a voluntary or
involuntary termination by the Company, your termination with severance, your
retirement, or your termination because of a disability) if such termination is
related to cause.

 

Options that are not and do not become exercisable at the time of your
termination of employment will, coincident therewith, terminate and be of no
force or effect.

8.

Transferability: Options are not transferable except by will or the laws of
descent and distribution and may be exercised during your life only by you or,
following your death or disability if any Options are still exercisable, by your
duly appointed guardian or other legal representative.

Notwithstanding the above and in the sole discretion of the Committee, Options
may be transferred to a qualified revocable trust provided such transfer is one
which is not treated as a taxable sale or exchange of the Options for federal
income tax purposes. In order to obtain approval of a transfer, please submit
your request to the Senior Vice President HR Services. If an approved transfer
to a qualified revocable trust occurs, no subsequent transfer or assignment will
be allowed and any such attempt will be disregarded as void. Transfers incident
to a divorce are not allowed.

 

9.

Other Terms and Conditions. The Design Details, an administrative document
adopted by the Committee which is set forth on the UBS Financial Services Inc.
website at https://onesource.ubs.com/so, contains additional provisions that
apply to the Options. Additionally, the Options are subject to all of the terms
and conditions set forth in the Plan and any other administrative documents
adopted by the Committee. By exercising any portion of the Options, you agree to
be subject to all of the terms and conditions of this Award Agreement.
Additionally, you agree to be subject to all of the terms and conditions of the
Plan, the Design Details, and any other administrative documents, as amended
from time to time.

 

 

2

 

 

 

10.

Additional Information: Please refer any questions you may have regarding these
Options to UBS Financial Services Inc. at 404-760-3312 or 1-866-4SO-OPTION or HR
Direct at 1-888-678-6787.

 

 

 

 

3