Document:

Asset elements Sale Agreement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sale
Agreement of asset elements

 

between Carrieres Polycor Inc

 

and

 

Rock of Ages Canada Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

  

	
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TABLE OF CONTENTS

1.         INTERPRETATION

            1.1             
Definitions

            1.2             
Titles and clauses

            1.3             
Type and number

            1.4             
Exhibits

            1.5             
Renunciation, modification

            1.6             
Applicable laws

 

2.         PURCHASE AND SALE

 

3.         PURCHASE PRICE

            3.1             
Purchase price

            3.2             
Adjustments

            3.3             
No liability intake

 

4.         PURCHASE PRICE TERMS AND CONDITIONS

            4.1             
Payment terms and conditions

            4.2             
Guaranteed deposit

            4.3             
Title search

            4.4             
Environmental verification

            4.5             
Guaranteed deposit remittance

            4.6             
Regulations with regards to the guaranteed deposit and to the trustee

 

5.         SELLER DECLARATIONS AND GUARANTEES

            5.1             
Seller declarations and guarantees

            5.2             
Declarations and guarantees of asset elements

            5.3             
Compliance with environmental relative laws

            5.4             
Survival of declarations and guarantees

 

6.         BUYER DECLARATIONS AND GUARANTEES

            6.1             
Declarations and guarantees

            6.2             
Survival of declarations and guarantees

 

7.         COMPENSATION

 

8.         COMMITMENTS BETWEEN PARTIES

            8.1             
Buyer' commitments

            8.2             
Seller's commitments

            8.3             
Party's commitments

            8.4             
Follow up of commitments

 

9.         NOTICE

            9.1             
Notice

            9.2             
Receipt of notice date

 

10.       GENERAL PROVISIONS

            10.1         
Cost and fees

            10.2         
Deadline

  

	
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SALE AGREEMENT OF ASSET ELEMENTS

 

BETWEEN: 

  

CARRIERES POLYCOR INC, a
legal corporate entity, with a head office situated at 138, Saint-Pierre street
in Quebec, Province of Quebec, G1K 8B9, represented by Charles Belzil, vice
president of the board of director and chief financial director of the company,
duly authorized hereinafter called: (THE SELLER)

  

AND:

  

ROCK OF AGES CANADA INC, a legal corporate
entity, with a head office situated at 1 Place Ville-Marie, bureau 4000, in
Montreal, province of Quebec, H3B 4M4, represented by Gabriel Ouellet, director
of finance and operations, duly authorized hereinafter called (THE BUYER)

    

  

1.               INTERPRETATION

1.1             Definitions

For the purpose of the present,
and also in all documents related or referred to, unless of an opposite
context, the following words, terms and expressions will signify:

1.1.1.   "Deed
of sale of the immoveable property" signifies the attached deed of sale in exhibit
8.3 to the present;

1.1.2.   "Agreement"
signifies the present agreement and all exhibits, in each case as they can
be amended or completed from time to time, and the expressions "the presents",
"in the presents", "to the presents" "in pursuance to the presents" by the
presents" and other similar expressions are referred to this agreement; and,
unless contrary indication, references to paragraphs and articles are
references to paragraphs and articles of this agreement.

1.1.3.   "Asset
elements" signifies asset elements described in article 2 of in the
present;

1.1.4.   "Immoveable
property" signifies part of lot 362 in Canton of Stanstead, in the
Stanstead district which is fully described in the Deed of Sale of the immoveable
property, and all other buildings or structures established on the said lot;

1.1.5.   "Inventory"
signifies the granite blocks that are actually found on the property with the
exclusion of the granite blocks sold by the Seller as of March 31, 2009 and
listed on exhibit 8.2.3. of the presents; for the purpose of
establishing an inventory sale price, a list of granite blocks category 1, 11,
and 111 is enclosed to the present;

1.1.6.   "Purchase
price" signifies the purchase price of the asset elements stipulated in
article 3 below subject to the provisions of article 4 of the presents;

  

	
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1.1.7.   "Title
irregularities" designate, collectively, (i) any irregularities in the
chain of titles of the property;  (ii) any charge, priority, mortgage, security
or any actual rights (except public utility right of way allocated to the
property but does not prevent its utilization or its exploitation), charges
mentioned in paragraph 5.2.1 and rights mentioned in paragraph 5.2.10 if these
are not erased in a stipulated deadline;  (iii) any legislative or statutory
provision federal, provincial, municipal or other, or the rights of a third
party that prevent the Seller to dispose of the property in favor of the Buyer
; and (iv) any relative authorization to the sale of the property required from
a third party or any commission, agency or other governmental group that was
not obtained.

1.2             Titles and clauses

 

Titles and clauses or paragraphs
are inserted to the presents only for reference purposes and cannot be used to
interpreter the content of this agreement.

 

1.3             Type and number

 

The masculine include the
feminine, the singular include the plural and vice versa.

 

1.4             Exhibits

1.5            
The following documents are
enclosed as exhibit to the present agreement:

Exhibit  1.1.5              Inventory

Exhibit  3.1.2              Inventory
sale price

Exhibit  3.3                 Addendum
to the sale agreement of asset elements

Exhibit  5.2.12            Commercial
names

Exhibit  8.1.1.             Supply
agreement

Exhibit  8.2.1              Non-competition
agreement

Exhibit  8.2.3              Granite
blocks belonging to the Seller

Exhibit  8.3                 Deed
of sale of the property

1.6             Renunciation, modification

Only if expressly anticipated in
the present agreement, no modification or renunciation to the present agreement
will bind a party unless it is recorded in writing and signed by the binding
party.  A renunciation to a provision of the present agreement does not
constitute a renunciation to any other provision to the present agreement and
no renunciation to a provision of the present agreement will constitute a
renunciation to bring it up in the future unless of an expressed provision to
this effect.

1.7             Applicable laws

The present agreement is
controlled and interpreted according to Quebec and Canada applicable laws.

2.               PURCHASE AND SALE

  

	
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      Under reserved provisions of the
present agreement, the Seller sells to the Buyer all moveable and immoveable
properties and all corporate and incorporate rights listed below:  

a)               Immovable property

b)              
All inventory

c)               All rights in all the intellectual property used by the Seller for
the exploitation of the property (except for those under the name "Polycor")
notably the names "Gris de Stanstead", Stanstead Grey", "Stanstead Gray,
"Mistigri" and "Misty Grey"

 

d)               all their rights in all permits, certificates and transferable licenses
necessary to the exploitation of the property notably, certificates given by
the Minister of Environment, if  

                  needed;

e)               all rights in mining rights, mining claims and exploitation leases that
the Seller has with regards to the exploitation of the property.

3.               PURCHASE PRICE

3.1             Purchase price

Under conditions, restrictions, representations,
guaranties, engagements and clauses of the presents, the purchase price to
acquire the asset Elements is an amount equal to the total of the following
amounts:

3.1.1          As for the asset elements other than the inventory, an amount of ONE
MILLION DOLLARS )1 000 000 000 $) distributed as follow:

        a)      ONE
HUNDRED THOUSAND DOLLARS (100 000 $) for the immoveable property

        b)      NINE
HUNDRED THOUSAND DOLLARS (900 000 $) for the exploitation rights of the granite
reserves

        c)      As
for the inventory, the anticipated amount is in exhibit 3.1.2.

3.2           Adjustments

               
School and municipal taxes with
regards to the property and municipal taxes collected in favor of quarry
operators are subject to an adjustment dated as of the present; in the

                eventuality that other adjustments are necessary, they will also be made as of
the present date according to the provisions of the Deed of Sale of the
Property.

 

3.3           No liability intake

 

Under paragraph 4.4.1 and 4.4.2 of
the presents, it is understood between parties that the Buyer does not assume
any liability intake from the Seller, neither debt or obligation,

of any nature it may be, related or not to asset Elements, including, without
restricting the general significance of the above, any loan, accounts payable,
fiscal responsibility for income taxes paid or not, any responsibility deriving
or related directly or indirectly to the exploitation of the Seller's

  

	
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enterprise on the property including all responsibilities regarding employees,
any environmental responsibility or any other responsibility and the Seller
commits himself, by the following, to compensate the Buyer and to cover any
damages, expenses, costs, finds, condemnation, responsibility or judgment with
regards to all of the above according to article 7 of the presents subject to
provision in exhibit 3.3 of the presents.

4.                 
PURCHASE PRICE TERMS AND CONDITIONS

4.1                Payment terms and conditions

   The purchase price is payable
according to the following methods of payment

4.1.1.      Jointly
at the signature of the presents, the Buyer pays the Seller, as a partial payment
of the Purchase Price, the sum of ONE MILLION TWO HUNDRED NINETEEN THOUSAND SIX
HUNDRED SEVENTY FIVE THOUSAND DOLLARS AND 84 cents (1 219 675.84 $) of which
the Buyer will acknowledge receipt and give full discharge;

4.1.2.      the
balance of the purchase Price, that is ONE HUNDRED THOUSAND (100 000 $) which
will be payable according to the provisions of paragraph 4.5 of the presents,

4.2             Guaranteed deposit

The parties agree to deposit in
favor of Lavery, de Billy, S.E.N.C.R.L. ( the "Consignee") in trust, the
sum of one hundred thousand dollars (100 000 $) (the guaranteed deposit)
will have to be invested as a term deposit in a Canadian chartered bank until
it is handed over according to the presents.  The guaranteed Deposit will be
paid to the Seller when the Deed of sale of the property is published to the
index of the properties without any adverse entries and according to the
clauses of paragraph 4.5 of the presents.

As long as a decision has not been made on the
guaranteed Deposit according to provisions of paragraphs 4.3 and 4.4, the Buyer
cannot exploit the property being understood that the Buyer can exploit the
property after this waiting period and it is also understood that the Seller
cannot assert his rights of usufruct indicated in the supply agreement during
this period during which the Buyer cannot exploit the property according to the
above.

4.3                   Title search

The buyer will have until May 31, 2009 to proceed,
at his own expense, to the examination of the property titles.  In the scope of
the titles' examinations, the following provisions will apply:

4.3.1       
If such an examination does not reveal any title irregularities and
charges referred to in paragraph 5.2.1. and rights referred to in paragraph
5.2.10 were removed within the deadline period and, no later than May 31, 2009
for the usufruct and the first refusal right granted to Tuile Grani-Décor Inc.
published at the public rights office of the district of Stanstead under number
163 847, then the guaranteed Deposit and accrued interest will be handed over
to the Seller statutory under the provisions of paragraph 4.4 of the presents.

  

	
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4.3.2       
However, if such an examination reveals titles irregularities, including
charges referred to in paragraph 5.2.1.and rights referred to in paragraph
5.2.10 and if they are not removed within the prescribed deadline and, no later
than May 31, 2009 as for the usufruct and the first refusal right granted to
Tuile Grani-Décor Inc. published at the public rights office of the district of
Stanstead under number 163 847, then a portion of the guaranteed Deposit will
be kept by the Consignee until correction of title irregularities are
revealed.  The Seller and the Buyer will reasonably determine the portion of
the guaranteed Deposit that will be kept by the Consignee, according to the nature
of the title irregularities that are left to cross off and reasonable costs to
guarantee the Buyer that the Seller will proceed to their correction according
to paragraph 4.3.3.  However, if the titles Irregularities that are left to
cross off are either the first refusal right granted to Tuile Grani-Décor Inc
and published under number 163 847 or the first refusal right granted to Granit
Bussiere Inc and published under number 146 212, then the entire amount of the
guaranteed Deposit will be kept by the Consignee until the said rights are
rectified to the Buyer's satisfaction.

4.3.3       
In the event that such an examination reveals title irregularities,
including changes referred to in paragraph 5.2.1 and rights referred to in
paragraph 5.2.10 if these were not removed within the prescribed deadline and,
no later than May 31, 2009 for the usufruct and the first refusal right granted
to Tuile Granit-Décor Inc. published at the public rights office of the
district of Stanstead under number 163 847, the Buyer will advise the Seller in
writing and the later is compelled by the following to rectify at his own cost
the alleged title Irregularities to the Buyer's satisfaction and this, within
30 days following the Buyer's notice (or a longer deadline if the title Irregularities
cannot reasonably be corrected within the 30 day deadline as long as the Seller
undertakes the necessary corrections of the title Irregularities in a diligent
manner).  If the Seller cannot, refuses or neglects to correct such title
Irregularities within the time allowed (or any other time frame agreed to
between parties), the Buyer can proceed, at the Seller's cost, to the
correction of the titles and the related costs and expenses incurred by the
Buyer, increased by 100%, will be taken from the portion of the guaranteed
Deposit kept for this purpose.  If the title corrections cannot be done without
the participation of the Seller and the later refuses or neglects to bring his
assistance to the Buyer within the allowed time (or another deadline agreed to
between parties), then the Buyer can keep the portion of the guaranteed Deposit
kept for this purpose and he also will keep all his rights to article 7, if
necessary, and all other rights and recourses allowed by law.

4.4             
Environmental verification

The Buyer will have until
May 31, 2009, to proceed, at his own expense, to the environmental evaluation
of the property.  In the framework of this evaluation, the following provisions
will be applicable:

 

4.4.1    If the environmental evaluation reveals that the property (i) does not
require any corrective measure or (ii) if the total environmental costs
(including environmental reports Phase 1 and 11) and the costs for corrective
measures resulting from the environmental evaluation as evaluated by an
environment expert that carried out the environmental evaluation, are evaluated
to 25 000 $ or less, then these costs will be entirely assumed by the Buyer and
in either cases, the guaranteed Deposit and accrued interests will be handed
over to the Seller under the reserved provisions of paragraph 4.3 of the
presents.

 

 

 

  

	
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4.4.2    If however, the total environmental evaluation costs (including
environmental reports Phase 1 and 11) and costs for corrective measures
resulting in the environmental evaluation as evaluated by an environment expert
that carried out the environmental evaluation are superior to 25 000 $, then
any amount exceeding 25 000 $ will be assumed in equal parts by the parties
(being however understood that the portion the Seller must assumed cannot
exceed in any case 100 000 $) and a portion of the guaranteed Deposit will be
kept by the Consignee until corrective measures are brought.  The portion of
the guaranteed Deposit that will be kept by the Consignee will be equal to the
cost that the Seller will have to assume according to the above.

4.4.3    If corrective measures for more than 25 000 $ are required, then the
Seller and the Buyer will work in conjunction for implementation of the
required work to correct the situation.

 

4.5       Guaranteed Deposit remittance

The parties agree that the
guaranteed Deposit will be treated according to the following provisions:

4.5.1    The Consignee is
authorized to remit the guaranteed Deposit along with accrued interest to the
Seller according to provisions of paragraphs 4.31 and 4.41 of the presents.  The
Buyer will have to advise the Consignee in writing that following the
examination of the titles and the environmental evaluation, the guaranteed
Deposit and accrued interest can be remitted to the Seller.

4.5.2    If, however, the Consignee has to keep a portion of the guaranteed
Deposit according to provisions of paragraphs 4.3.2 or 4.4.2, then the
Consignee is authorized to keep the amount that will be determined according to
provisions of paragraphs 4.3.2 or 4.4.2 and to remit the balance of the
guaranteed Deposit along with accrued interests to the Seller.  The Buyer will
have to advise the Consignee in writing of the amount that he must keep
according to provisions of paragraphs 4.3.2 or 4.4.2.

4.5.3    If, however, the title examination or an applicable legislation of the
property or to the Buyer result that the present sale is null or that the
Buyer's property title is null, then the present sale will be terminated and
the Seller will remit the purchase Price to the Buyer and the Consignee is
authorized to remit the guaranteed Deposit along with accrued interests to the
Buyer.  The Buyer will have to advise the Consignee in writing that the sale is
null or that his title is null and the Consignee is authorized to remit the
guaranteed Deposit and accrued interests to the Buyer.

4.5.4    If the title corrections cannot be done without the Seller's
participation and the later refuses or neglects to bring his assistance as
described in paragraph 4.3, then the Buyer will have to advise the Consignee in
writing and the Consignee is authorized to remit the guaranteed Deposit and
accrued interests to the Buyer.

Any amount deducted from the
guaranteed Deposit according to provisions of paragraphs 4.3 and 4.4 of the
presents will be reduced from the purchase Price.

4.6      Regulations with regards to the guaranteed deposit and to the
consignee

The parties agree that the
guaranteed Deposit and the Consignee are subject to the following:

 

 

 

 

  

	
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4.6.1   
The Consignee will have to keep the guaranteed Deposit and remit it to
the Seller or to the Buyer, according to the following provisions;

4.6.2   
The Consignee will have to deduct costs and expenses and remit them to
the Buyer as agreed to the presents;

4.6.3    until it is remitted as stated above, the Consignee will have to place
the guaranteed Deposit into a term deposit in a Canadian chartered bank;
proceeds from this guaranteed Deposit in interests and revenues and any renewal
will be part of this guaranteed Deposit;

4.6.4   
except in cases of a severe error or an intentional error, the Consignee
will not be responsible within the present agreement, for any gesture nor for
any measure that he has made, omitted to make or taken, in good faith, nor for
any error without prejudice in facts and in rights.  Without limiting the
above, it is understood that the Consignee will not incur any responsibility
for a gesture, a measure or an omission from his part to act following a
notice, a request, a renunciation, a consent or any other document that was
given to him according to the presents, not only towards the validity of the
signatures that appear and the provisions they hold, but also towards the
veracity and the sufficiency of the information that appear and that the
Consignee believe in good faith to be authentic;

4.6.5    Notwithstanding any disposition to the "Loi relative a l'administration
du bien d'autruit" or to fiduciary obligations, the Seller and the Buyer agree
that the Consignee's obligations are limited to the generality of the above,
the Consignee is not required to subscribe to an insurance, to give any
guarantee or to render an analysis of account at the end of this agreement;

4.6.6    The parties agree, severally and jointly, to indemnify and cover the
Consignee from any claim costs or damages sustained or incurred by the
Consignee in relation with the execution of the mandate provided to the
presents.

5.        
SELLER DECLARATIONS AND GUARANTEES

5.1        Declarations and guarantees for the Seller

             The Seller declares and guarantees the Buyer what
follows and recognizes that the Seller based the purchase of asset elements on
these declarations and guarantees.

5.1.1.   The
Seller has the power to possess asset Elements and he has the power, the
authority and the right to conclude and to execute the present agreement along
with the Deed of sale of the Property and the non-competition agreement without
other formalities than those already completed; the Seller duly signed and
delivered the present agreement along with the Deed of sale of the Property and
the Agreement of non-competition and these agreements establish valid and
obligatory obligations towards the Buyer, enforceable according to their
provisions;

5.1.2.   The
Seller has the power to exploit the Property as he is actually doing and
benefits from this point of view to the acquired rights allowing him to do so;

  

	
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5.1.3.   the
conclusion of the present agreement, the Deed of sale of the Property and the
non-competition Agreement and actions that imply their executions will not
infringe in any way on the consecutive act and the Seller's agreements,
contracts or laws to which he is bonded to, rulings and judgments to which the
Seller is subjugated to.

5.1.4.   neither
the present agreement, nor the Deed of sale of the property and nor the
non-competition Agreement, nor any actions assuming their executions will
expose the Seller to a loss, a suspension or the termination of either one of
the permits, licenses, authorizations with regards to the property.

5.1.5.   The
Seller is a Canadian resident in terms of the Canadian Income Tax Revenue Law (Canada) and the Income Tax law (Quebec).

5.2       Declarations and guarantees of asset elements

5.2.1.   The
Seller has a clear title, good and valid on asset Elements, these are free and
clear of any charge, priority, mortgage, safety or of any known rights,
published or not, except constraints or other charges that may affect the
property but does not prevent its use or exploitation and except

(i)         a suspensive usufruct right ending April 23, 2017, in favor of Tuiles
Granit-Décor Inc. incorporated under terms of an agreement published at the
public rights office of the district of Stanstead on October 9, 1990, under
number 163 847 and that the Seller is committed to have it removed at his own
cost following the date of the presents;

(ii)         a suspensive usufruct right in favor of Granit Bussiere Inc., in order
to assure them a supply of granite and this, for a period of (30) years
starting April 24, 1987, incorporated under an agreement published at the
public rights office of the district of Stanstead on May 14, 1987 under number
146 212 and the Seller is committed to have it removed at his own expense
within a deadline of thirty (30) days of the presents;

(iii)       a mortgage act agreed to by Polycor Inc., Carrieres Polycor Inc., Dumas
and Voyer Inc., Granilac nc., La Compagnie Novostone Inc., Bordures Polycor
Inc./Polycor Granit Curbs Inc., Polycor Granite Bussiere Inc., Tuiles Polycor
Inc./Polycor Tiles Inc. and Tranches Polycor Inc./Polycor Slabs Inc. in favor
of Trust National Bank Inc. published in Stanstead on June 1st, 2007
under number 14 286 067 which will be removed from the property at the Seller's
expense jointly at the publication of the Deed of sale of the property;

5.2.2.   all
taxes and contributions, either general or special, school or municipal and all
other taxes allocated to the property have been paid, for the payment of
municipal taxes until December 31st, 2009 and up to June 30th,
2009 for school taxes and all transferred rights have been released, all
without consolidation or subrogation in favor of a third party.

5.2.3.   the
use of the property is in accordance to all important aspects, all laws, rules
and standards (as at the federal, provincial levels, municipal or other),
including without limiting the above, those concerning the environment (with
the exception of what will be uncovered by the environmental inspection
provided under the terms of the presents ("the environmental inspection")
and the zoning and is in accordance to all legislative and statutory provisions
applicable;

 

  

	
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5.2.4.   the
property has been removed from the agricultural zoning in accordance with
decision number 311427 rendered by the agricultural territory protection
Commission on February 21, 2000;

 

5.2.5.   the
use of the property does not constitute a violation or a default towards an
agreement or an important contract in relation with the property (including any
lease, offer, promise or lease contract, any insurance policy or other contract),
nor with regards to any judgment, decision, ruling, demand or decree from a
tribunal or an arbitrator or agency, an office, an administration, commission,
ministry or any other public authority;

 

5.2.6.   at
the date of the presents it does not exist any claim, expropriation, judiciary
procedures or other, with regards to the property or to its operation, except
for what is revealed in writing to the Buyer and accepted in writing by the
later and the Seller has complied fully to any notice received from the Seller
or any previous owners, concerning the non compliance of the property, its use,
or otherwise, issued by every authority with jurisdiction in relation with any
law, any rulings or any legislative provisions and, furthermore, the Seller has
not received such a notice to which he has not complied to, except, as revealed
in writing by the Buyer and accepted in writing by the later;

 

5.2.7.   there
is no construction or renovation done on the property within the previous
thirty five (35) days of the present agreement which could be grounds for a
claim precedent against the property;

 

5.2.8.   buildings
and other structures situated on the property are in accordance with all laws
and all municipal regulations as well with all other regulations (with the
exception of what will be revealed by the environmental inspection) and there
are no restrictive agreement, no municipal regulation or other law or
regulation that, in some way, restraint or forbid the use of the property, its
buildings or its structures as they are presently used;

 

5.2.9.   there
is no lawsuit, pursuit, pleas or apprehended pursuit nor there are no lawsuit
threats, pursuit or procedures implicating asset Elements before a tribunal,
commission, agency or other governmental group;

 

5.2.10. the asset Elements are not
the object of any sale agreement, first refusal right, option and it does not
exist any right susceptible to become a contract for the acquisition of asset
Elements except (i) a first refusal right in favor of Garnit Bussiere Inc
towards which the Seller is committed to obtain a renunciation and to have it
removed at his own expense within a deadline of thirty (30) days from the
presents and (ii) a first refusal right for the acquisition of the property in
favor of Tuile Granit-Décor Inc towards which the Seller is committed to obtain
a renunciation and to have it removed at his own expense within  a reasonable
deadline following the date of the presents;

 

5.2.11.  the Seller does not have any
information nor enquiries in relation with the asset Elements that, if they
were known by the Buyer, may reasonably discourage him to complete the expected
transaction to the presents at the price and conditions described to the
presents;

 

5.2.12.  the list and commercial
names used in relation with the asset Elements is enclosed under exhibit
5.2.12.

5.3          Compliance
with environmental relative laws

  

	
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5.3.1.   the
Seller does not violate nor has he violated laws, regulations, policies,
directives, directive lines, rulings nor decrees from the federal, provincial,
municipal or local governments in view of environmental questions (with the
exception of what will be revealed by the environmental inspection)
(collectively named "Laws relative to the environment").

5.3.2.   the
Seller removed from the property all contaminants and sources of contaminants
that may or can have a contravene effect to Laws relative to the environment
(with the exception of what will be revealed by the environmental inspection)

5.3.3.   there
is no underground or above ground reservoir on or under the property except
those referred to in paragraph 8.2.4 of the presents;

5.3.4.   no
decree, no corrective notice or infraction nor any other request was given
under relative environmental Laws with regards to the property;

5.3.5.   the
Seller did not omit to declare to appropriate governmental authorities any
event that he should declare in pursuance with Laws relative to the environment
and the Seller has supplied the Buyer with exact and complete copies of all
related reports and correspondence. 

5.4       Survival of
declarations and guarantee;

The contents of
declarations and guarantees of the Seller in the present agreement and in all
documents supplied in pursuance to the present agreement or referred to will
follow at the date of the present agreement for a duration of three years
following the date of the presents;

6.          BUYER DECLARATIONS AND GUARANTEES

6.1        Declarations and guarantees

The Buyer declares and
guarantees to the seller as follow:

6.1.1.   under
reserved applicability of the Law on Acquisition of agricultural land by
non residents, the Buyer has the power and the capacity to conclude and
complete his obligations in pursuance of the present agreement and all other
agreements, all contracts and all other documents that the Buyer signs or
delivers in pursuance of the present agreement.  The Buyer has duly singed and
delivered such agreements, contracts and documents and they establish valid and
obligatory obligations towards the Seller, enforceable according to these
provisions;

6.1.2.   the
conclusion of the present agreement along with the Deed of sale of the property
and all acts that imply their execution will not infringe on the constitutive
act and regulations of the Seller, contracts to which he is bounded to or laws,
rulings and judgments to which the Seller is subjugated

6.1.3.   the
Buyer is a Canadian resident in terms of the Canadian Income Tax Revenue Law (Canada) and the Income Tax law (Quebec);

6.2       Survival of
declarations and guarantees

The contents of
declarations and guarantees of the Buyer in the present agreement and in all
documents supplied in pursuance to the present agreement or referred to will
follow at the date of the present agreement for a duration of three years
following the date of the presents;

 

 

  

	
  12

  

  

7.         COMPENSATION

Under reserve of provisions
in paragraph 5.4 of the presents, the Buyer will have to keep the Seller
indemnified and covered against any damage, loss, commitment, responsibility,
claim, charge, mistrust, cost and expense (including fees and disbursements,
judicial and extra-judicial, lawyers and all other costs and expenses
attributable to any legal action, inquiry action, claim or procedure) that the
Buyer may have sustained, supported, incurred or may have to pay following a
violation or an inaccuracy of representations, guarantees, stipulations,
agreement or engagements of the Seller in pursuance of the presents;  without
limiting the above, the Seller agrees to keep the Buyer indemnified against any
recourse from Granit Bussiere Inc. and Tuiles Granit-Décor Inc. and this with
regards to their first refusal right and the usufruct referred to in paragraphs
5.2.1 and 5.2.10 of the presents.  If there should be an amount claimed to the
Buyer that should be kept indemnified by the Seller according to the terms of
this agreement, except those specifically assumed by the Buyer in pursuance of
the presents, the Buyer will advise the Seller of this claim and the Seller
will have to assist the Buyer with a contestation of such a claim.  If the
Buyer has to pay an amount whatsoever following a claim contested or not, the
Seller be will indebted towards the Buyer for an equal amount paid in capital,
interests, penalties, costs and accessories along with costs incurred by the
Buyer (including fees and disbursements, judiciary and extra judiciary,
reasonable of his lawyer) concerning such a claim.

Any amount payable
according to the present compensation obligation cannot in any way exceed the
amount equivalent to the purchase Price.

8.         COMMITMENTS BETWEEN PARITES

Buyer's commitments

The Buyer is committing the
following toward the Seller:

8.1.1.      to
sign, jointly to the presents, a supply agreement according to the example
enclosed and titled exhibit 8.1.1.;

8.1.2.      Stanstead
Grey blocks of a net dimension of 12-0 x 6-0 x 6-0 (82 blocks are presently
foreseen) will be supplied by the Buyer to the Seller for the "Franklin D.
Roosevelt" project at a price of 20 $ per cubic foot in a period of four months
following the order if the order is in the hands of the Buyer during the months
of April to August, otherwise, delivery will be six months;

8.1.3.      to
pay, in relation with the property, all outstanding property taxes, including
the tax ratio for the current year, starting from the date of the presents, as
for the municipal tax perceived in favor of quarry operators, the Seller will
have to reimburse the Buyer his portion of this tax as soon as the Buyer will
give the Seller the May 31, 2009 statement prepared by the Municipality of
Ogden.

8.2       Seller's commitments

The Seller is committing
the following toward the Buyer

8.2.1.    to
sign, jointly to the presents, a non-competition agreement in favor of the
Buyer according to the example enclosed titled exhibit 5.2.12;

 

  

	
  13

  

  

8.2.2.   at
the request of the Buyer, to sign necessary documents to transfer to the Buyer
all commercial names used in relation with the asset Elements from the enclosed
list titled exhibit 5.2.12;

8.2.3.   to
proceed, at his own cost, no later than three (3) months from the presents, at
the removal of equipments and granite blocks that belong to the Seller and that
were sold by him as of March 31, 2009 which are on the enclosed list under the
title exhibit 8.2.3 and if failing to do so, they will become the
property of the Buyer at the expiring deadline of three (3) months without
compensation;

8.2.4.   to
proceed, at his own cost, no later than six (6) days from the presents, to the
removal of the trailer and of the three (3) above ground reservoirs situated on
the Property; the Seller can temporary store them on the Buyer's land in Ogden
(the reservoirs must be previously emptied) but will have to remove them from
the Buyer's land in Ogden by June 15, 2009 the latest;

8.2.5.   to
obtain the renunciation or respective waivers from Granit Bussiere Inc and
Tuiles Granit-Décor Inc., their first refusal rights referred to in paragraph
5.2.10 of the presents and their usufruct rights mentioned in paragraph 5.2.1
(i) and (ii) of the presents and to be entirely published in the land registry
of the district of Stanstead in a limited time;

8.2.6.   to
do, sign, hand over or see that all other acts, documents and things that the
Buyer may require from time to time in order to bring this present agreement
into effect are done, signed, handed over and the Buyer is agreeing to fully
cooperate with the Seller in the framework of the examination of the property
titles or if the Buyer has to demonstrate his acquired rights in connection
with the Property in front of a tribunal, commission, agency or other
governmental group, and to take all necessary measures to fully implement the
understandings of the present agreement.

8.3        Party's commitments

The parties commit between
one and the other to sign, jointly to the presents, a deed of sale of the
Property in favor of the Buyer for publication in the land registry of the
district of Stanstead according to the enclosed example titled exhibit 8.3.  
The present agreement and the Deed of sale of the Property are a unified entity
and all provisions of the presents, including the compensation obligation,
benefit the Buyer to the terms of the Deed of sale of the Property and are
integrated in return.   If the Buyer obtains a certificate of localization
related to the property and it describes a more updated technical description
of the property, then the parties agree to sign an agreement in which the
updated technical description will be corrected in the Deed of sale of the
Property.

8.4       Follow up of commitments

The parties' commitments
contained in the present agreement and in all remitted documents pursuant or
aimed to the presents will follow the date of the present agreement.

9.         NOTICE

9.1       Notice

           
Any notices, documents or
other communications to be given to the terms of the presents will have to be
in writing and will be sufficient if personally delivered, sent by registered
mail or faxed (with the understanding that in case of disruption in the postal
service, such a notice, document of other communication will have to be
delivered or notified personally or by fax), to the following addresses:

  

	
  14

  

  

 

9.1.1    For the Seller:

            138, rue Saint Pierre

            Quebec, QC.   G1K 3V9

                        Fax: 
(418) 692-0981

                        To
the attention of Mr. Irenee Bouchard, president and chief of the board of directors

 

9.1.2.   For
the Buyer:

4 rue Rock of Ages

Stanstead, QC.  J0B 3E2

Fax: 
(819) 876-2234

To
the attention of Mr. Gabriel Ouellet, Director
of Finances and Operations

Each party to the present
will have the right to specify a different address than the above by advising
the other party in an appropriate manner.

9.2        Receipt of notice date

Any notice, documents or
other communications, if sent by fax, will be deemed to have been received on
the following business day it was sent, if sent by registered mail, the 3rd
day following the mailing date and, if delivered or notified personally, the
day of the delivery or notification.

10.       GENERAL DISPOSITIONS

10.1     Costs and fees

Each party will pay the
fees of their advisors with regards to the presents and their related
transaction along with their execution.

10.2     Deadline

All anticipated deadlines
to the present are compulsory and can only be prolonged by the written consent
of the party that will benefit from this delay or by the Seller and the Buyer
if the delay is to their advantage.

 

 

 

 

 

 

 

  

	
  15

  

  

WHEREOF, Carrieres
Polycor Inc has signed the present agreement in Montreal this 17th
day of April 2009.

            

 CARRIERES
POLYCOR INC

 

Per:      Charles Belzil,
vice president of the board of directors

            and chief
financial director

 

WHEREOF, Rock of Ages
Canada Inc, has signed the present agreement in Montreal this 17th
day of April 2009

            

 ROCK OF AGES
CANADA INC

 

Per:      Gabriel Ouellet, director of finance and operations   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

            

  

	
  16Exhibit 4.2
 

 

 

 

THE SOUTHERN COMPANY

 

TO

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

TRUSTEE

 

 

 

____________________

 

FOURTH SUPPLEMENTAL INDENTURE

 

DATED AS OF MAY 19, 2009

 

____________________

 

 

 

SERIES 2009A 4.15% SENIOR NOTES

 

DUE MAY 15, 2014

 

 

 

 

	
             
 	
            
 

 

 

TABLE OF CONTENTS1

 

Page

 

	
            ARTICLE 1                    SERIES 2009A SENIOR NOTES
 	
            1
 

	
            SECTION 101.                                             Establishment
 	
            1
 

	
            SECTION 102.                                             Definitions
 	
            2
 

	
            SECTION 103.                                             Payment of Principal and Interest
 	
            3
 

	
            SECTION 104.                                             Denominations
 	
            4
 

	
            SECTION 105.                                             Global Securities
 	
            4
 

	
            SECTION 106.                                             Transfer
 	
            5
 

	
            SECTION 107.                                             Redemption at the Company’s Option
 	
            5
 

	
            ARTICLE 2                    MISCELLANEOUS PROVISIONS
 	
            6
 

	
            SECTION 201.                                             Recitals by Company
 	
            6
 

	
            SECTION 202.                                             Ratification and Incorporation of Original Indenture
 	
            6
 

	
            SECTION 203.                                             Executed in Counterparts
 	
            6
 

 

_________________________

1 This Table of Contents does not constitute part of the Indenture or have any bearing upon the interpretation of any of its terms and provisions. 

 

i

 

 

                        THIS FOURTH SUPPLEMENTAL INDENTURE is made as of the 19th day of May, 2009, by and between THE SOUTHERN COMPANY, a Delaware corporation, 30 Ivan Allen Jr. Blvd., N.W., Atlanta, Georgia 30308 (the “Company”), and Wells Fargo Bank, National Association, a national banking association, 7000 Central Parkway, Suite 550, Atlanta, Georgia 30328 (the “Trustee”).

 

W I T N E S S E T H:

 

WHEREAS, the Company has heretofore entered into a Senior Note Indenture, dated as of January 1, 2007 (the “Original Indenture”), with Wells Fargo Bank, National Association;

 

WHEREAS, the Original Indenture is incorporated herein by this reference and the Original Indenture, as heretofore supplemented and as further supplemented by this Fourth Supplemental Indenture, is herein called the “Indenture”;

 

WHEREAS, under the Original Indenture, a new series of Senior Notes may at any time be established pursuant to a supplemental indenture executed by the Company and the Trustee;

 

WHEREAS, the Company proposes to create under the Indenture a new series of Senior Notes;

 

WHEREAS, additional Senior Notes of other series hereafter established, except as may be limited in the Original Indenture as at the time supplemented and modified, may be issued from time to time pursuant to the Indenture as at the time supplemented and modified; and

 

WHEREAS, all conditions necessary to authorize the execution and delivery of this Fourth Supplemental Indenture and to make it a valid and binding obligation of the Company have been done or performed.

 

NOW, THEREFORE, in consideration of the agreements and obligations set forth herein and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

 

ARTICLE 1

 

SERIES 2009A SENIOR NOTES

 

SECTION 101.Establishment.  There is hereby established a new series of Senior Notes to be issued under the Indenture, to be designated as the Company’s Series 2009A 4.15% Senior Notes due May 15, 2014 (the “Series 2009A Notes”).

 

There are to be authenticated and delivered $350,000,000 principal amount of Series 2009A Notes, and such principal amount of the Series 2009A Notes may be increased from time to time 

 

	
             
 	
            
 

 

 

pursuant to Section 301 of the Original Indenture.  All Series 2009A Notes need not be issued at the same time and such series may be reopened at any time, without the consent of any Holder thereof, for issuances of additional Series 2009A Notes.  Any such additional Series 2009A Notes will have the same interest rate, maturity and other terms as those initially issued.  No Series 2009A Notes shall be authenticated and delivered in excess of the principal amount as so increased except as provided by Sections 203, 303, 304, 907 or 1107 of the Original Indenture.  The Series 2009A Notes shall be issued in definitive fully registered form.

 

The Series 2009A Notes shall be issued in the form of one or more Global Securities in substantially the form set out in Exhibit A hereto.  The Depositary with respect to the Series 2009A Notes shall be The Depository Trust Company.

 

The form of the Trustee’s Certificate of Authentication for the Series 2009A Notes shall be in substantially the form set forth in Exhibit B hereto.

 

Each Series 2009A Note shall be dated the date of authentication thereof and shall bear interest from the date of original issuance thereof or from the most recent Interest Payment Date to which interest has been paid or duly provided for.

 

SECTION 102.Definitions.  The following defined terms used herein shall, unless the context otherwise requires, have the meanings specified below.  Capitalized terms used herein for which no definition is provided herein shall have the meanings set forth in the Original Indenture.

 

 “Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Series 2009A Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the Series 2009A Notes.

 

 “Comparable Treasury Price” means, with respect to any Redemption Date, (i)  the average of the Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and lowest of such Reference Treasury Dealer Quotations or (ii) if the Company obtains fewer than four of such Reference Treasury Dealer Quotations, the average of all such quotations.

 

 “Independent Investment Banker” means an independent investment banking institution of national standing appointed by the Company.

 

 “Interest Payment Dates” means May 15 and November 15 of each year, commencing November 15, 2009.

 

	
             
 	
            “Original Issue Date” means May 19, 2009.
 

 

	
             
 	
            “Redemption Price” has the meaning given to it in Section 107 hereof.
 

 

 

2

 

 

 “Reference Treasury Dealer” means a primary United States Government securities dealer in the United States appointed by the Company.

 

 “Reference Treasury Dealer Quotation” means, with respect to each Reference Treasury Dealer and any Redemption Date, the average, as determined by the Company, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount and quoted in writing to the Company by such Reference Treasury Dealer at 5:00 p.m. on the third Business Day in New York City preceding such Redemption Date).

 

 “Regular Record Date” means, with respect to each Interest Payment Date, the close of business on the 15th calendar day preceding such Interest Payment Date (whether or not a Business Day).

 

	
             
 	
            “Stated Maturity” means May 15, 2014.
 

 

 “Treasury Yield” means, with respect to any Redemption Date, the rate per annum equal to the semiannual equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such Redemption Date.

 

SECTION 103.Payment of Principal and Interest.  The principal of the Series 2009A Notes shall be due at Stated Maturity (unless earlier redeemed).  The unpaid principal amount of the Series 2009A Notes shall bear interest at the rate of 4.15% per annum until paid or duly provided for.  Interest shall be paid semiannually in arrears on each Interest Payment Date to the Person in whose name the Series 2009A Notes are registered on the Regular Record Date for such Interest Payment Date, provided that interest payable at the Stated Maturity or on a Redemption Date as provided herein will be paid to the Person to whom principal is payable.  Any such interest that is not so punctually paid or duly provided for will forthwith cease to be payable to the Holders on such Regular Record Date and may either
be paid to the Person or Persons in whose name the Series 2009A Notes are registered at the close of business on a Special Record Date for the payment of such defaulted interest to be fixed by the Trustee, notice whereof shall be given to Holders of the Series 2009A Notes not less than ten (10) days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange, if any, on which the Series 2009A Notes shall be listed, and upon such notice as may be required by any such exchange, all as more fully provided in the Original Indenture.

 

Payments of interest on the Series 2009A Notes will include interest accrued to but excluding the respective Interest Payment Dates.  Interest payments for the Series 2009A Notes shall be computed and paid on the basis of a 360-day year of twelve 30-day months.  In the event that any date on which interest is payable on the Series 2009A Notes is not a Business Day, then a payment of the interest payable on such date will be made on the next succeeding day that is a Business Day (and without any interest or other payment in respect of any such delay), with the same force and effect as if made on the date the payment was originally payable.

 

3

 

 

Payment of the principal and interest due at the Stated Maturity or earlier redemption of the Series 2009A Notes shall be made upon surrender of the Series 2009A Notes at the Corporate Trust Office of the Trustee.  The principal of and interest on the Series 2009A Notes shall be paid in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.  Payments of interest (including interest on any Interest Payment Date) will be made, subject to such surrender where applicable, at the option of the Company, (i) by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or (ii) by wire transfer or other electronic transfer at such place and to such account at a banking institution in the United States as may be designated in writing to the Trustee at least
sixteen (16) days prior to the date for payment by the Person entitled thereto.

 

SECTION 104.Denominations.  The Series 2009A Notes may be issued in denominations of $1,000, or any integral multiple thereof.

 

SECTION 105.Global Securities.  The Series 2009A Notes will be issued in the form of one or more Global Securities registered in the name of the Depositary (which shall be The Depository Trust Company) or its nominee.  Except under the limited circumstances described below, Series 2009A Notes represented by one or more Global Securities will not be exchangeable for, and will not otherwise be issuable as, Series 2009A Notes in definitive form.  The Global Securities described above may not be transferred except by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or to a successor Depositary or its nominee.

 

Owners of beneficial interests in such a Global Security will not be considered the Holders thereof for any purpose under the Indenture, and no Global Security representing a Series 2009A Note shall be exchangeable, except for another Global Security of like denomination and tenor to be registered in the name of the Depositary or its nominee or a successor Depositary or its nominee.  The rights of Holders of such Global Security shall be exercised only through the Depositary.

 

Subject to the procedures of the Depositary, a Global Security shall be exchangeable for Series 2009A Notes registered in the names of persons other than the Depositary or its nominee only if (i) the Depositary notifies the Company that it is unwilling or unable to continue as a Depositary for such Global Security and no successor Depositary shall have been appointed by the Company, or if at any time the Depositary ceases to be a clearing agency registered under the Securities Exchange Act of 1934, as amended, at a time when the Depositary is required to be so registered to act as such Depositary and no successor Depositary shall have been appointed by the Company, in each case within 90 days after the Company receives such notice or becomes aware of such cessation, (ii) the Company in its sole discretion determines that such Global Security shall be so exchangeable, or (iii) there shall
have occurred an Event of Default with respect to the Series 2009A Notes.  Any Global Security that is exchangeable pursuant to the preceding sentence shall be exchangeable for Series 2009A Notes registered in such names as the Depositary shall direct.

 

Neither the Company, the Trustee nor any agent of the Company or the Trustee shall have any responsibility or liability for any aspect of the records relating to or payments made on account 

 

4

 

 

of beneficial ownership interests in a Global Security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests.

 

SECTION 106.Transfer.  No service charge will be made for any transfer or exchange of Series 2009A Notes, but payment will be required of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith.

 

The Company shall not be required (a) to issue, register the transfer of or exchange any Series 2009A Notes during a period beginning at the opening of business fifteen (15) days before the date of the mailing of a notice pursuant to Section 1104 of the Original Indenture identifying the serial numbers of the Series 2009A Notes to be called for redemption, and ending at the close of business on the date of the mailing, or (b) to register the transfer of or exchange any Series 2009A Notes theretofore selected for redemption in whole or in part, except the unredeemed portion of any Series 2009A Notes redeemed in part.

 

SECTION 107.Redemption at the Company’s Option.  The Series 2009A Notes will be subject to redemption at the option of the Company in whole or in part at any time and from time to time, upon not less than 30 nor more than 60 days’ notice.  The Company shall have the right to redeem the Series 2009A Notes in whole or in part at redemption prices (each, a “Redemption Price”) equal to the greater of (1) 100% of the principal amount of the Series 2009A Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest on the Series 2009A Notes being redeemed (not including any portion of such payments of interest accrued to the Redemption Date) discounted (for purposes of determining present value) to the Redemption Date on a semiannual basis (assuming a 360-day year
consisting of twelve 30-day months) at a discount rate equal to the Treasury Yield plus 35 basis points, plus, in each case, accrued interest thereon to the Redemption Date.

 

In the event of redemption of the Series 2009A Notes in part only, a new Series 2009A Note or Notes for the unredeemed portion will be issued in the name or names of the Holders thereof upon the surrender thereof.

 

	
             
	
            The Series 2009A Notes will not have a sinking fund.

 

Notice of redemption shall be given as provided in Section 1104 of the Original Indenture.  The Trustee shall not be responsible for the calculation of the Redemption Price.  The Company shall calculate the Redemption Price and promptly notify the Trustee thereof.

 

Any redemption of less than all of the Series 2009A Notes shall, with respect to the principal thereof, be divisible by $1,000.

 

 

5

 

 

ARTICLE 2

 

MISCELLANEOUS PROVISIONS

 

SECTION 201.Recitals by Company.  The recitals in this Fourth Supplemental Indenture are made by the Company only and not by the Trustee, and all of the provisions contained in the Original Indenture in respect of the rights, privileges, immunities, powers and duties of the Trustee shall be applicable in respect of Series 2009A Notes and of this Fourth Supplemental Indenture as fully and with like effect as if set forth herein in full.

 

SECTION 202.Ratification and Incorporation of Original Indenture.  As supplemented hereby, the Original Indenture is in all respects ratified and confirmed, and the Original Indenture as supplemented by this Fourth Supplemental Indenture shall be read, taken and construed as one and the same instrument.

 

SECTION 203.Executed in Counterparts.  This Fourth Supplemental Indenture may be simultaneously executed in several counterparts, each of which shall be deemed to be an original, and such counterparts shall together constitute but one and the same instrument.

 

 

6

 

 

                        IN WITNESS WHEREOF, each party hereto has caused this instrument to be signed in its name and behalf by its duly authorized officer, all as of the day and year first above written.

 

	
             
 	
            THE SOUTHERN COMPANY
 
	
             
 	
             
 
	
             
 	
             
 
	
             
 	
            By:       /s/ W. Paul Bowers                                                                                                 
 
	
             
 	
            W. Paul Bowers
 
	
             
 	
            Executive Vice President and Chief Financial       Officer

 

 
 
	
             
 	
            WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee
 
	
             
 	
             
 
	
             
 	
            By:       /s/ Elizabeth T. Wagner                                                
 
	
             
 	
            Elizabeth T. Wagner

Vice President

 
 
	
             
 	
             
 

 

 

 

 

	
             
 	
            
 

 

 

	
             
 	
            EXHIBIT A
 

 

	
             
 	
            FORM OF SERIES 2009A NOTE
 

 

	
            NO. __
 	
            CUSIP NO. 842587 CE5
 

 

 

THE SOUTHERN COMPANY

SERIES 2009A 4.15% SENIOR NOTE

	
             
 	
            DUE MAY 15, 2014
 

 

 

	
             
 	
            Principal Amount:
 	
            $______________
 
	
             
 	
             
 	
             
 
	
             
 	
            Regular Record Date:
 	
            15th calendar day prior to the applicable Interest Payment Date (whether or not a Business Day)
 
	
             
 	
             
 	
             
 
	
             
 	
            Original Issue Date:
 	
            May 19, 2009
 
	
             
 	
             
 	
             
 
	
             
 	
            Stated Maturity:
 	
            May 15, 2014
 
	
             
 	
             
 	
             
 
	
             
 	
            Interest Payment Dates:
 	
            May 15 and November 15
 
	
             
 	
             
 	
             
 
	
             
 	
            Interest Rate:
 	
            4.15% per annum
 
	
             
 	
             
 	
             
 
	
             
 	
            Authorized Denominations:
 	
            $1,000 or any integral multiple thereof
 

 

 

The Southern Company, a Delaware corporation (the “Company,” which term includes any successor corporation under the Indenture referred to on the reverse hereof), for value received, hereby promises to pay to _____________________________________, or registered assigns, the principal sum of ________________________________ DOLLARS ($__________) on the Stated Maturity shown above (or upon earlier redemption), and to pay interest thereon from the Original Issue Date shown above, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, semiannually in arrears on each Interest Payment Date as specified above, commencing on November 15, 2009 and on the Stated Maturity (or upon earlier redemption) at the rate per annum shown above until the principal hereof is paid or made available for payment and at such rate on any overdue principal and
on any overdue installment of interest.  The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date (other than an Interest Payment Date that is the Stated Maturity or on a Redemption Date) will, as provided in such Indenture, be paid to the Person in whose name this Note (the “Note”) is registered at the close of business on the Regular Record Date as specified above next preceding such Interest Payment Date, provided that any interest payable at the Stated Maturity or on any Redemption Date will be paid to the Person to whom principal is payable.  Except as otherwise provided in the Indenture, any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Note is registered at the close of business on a Special Record Date for the payment of such defaulted interest to be fixed by the Trustee, notice whereof
shall be given to Holders of Notes of this series not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange, if any, on 

 

which the Notes of this series shall be listed, and upon such notice as may be required by any such exchange, all as more fully provided in the Indenture.

 

Payments of interest on this Note will include interest accrued to but excluding the respective Interest Payment Dates.  Interest payments for this Note shall be computed and paid on the basis of a 360-day year of twelve 30-day months.  In the event that any date on which interest is payable on this Note is not a Business Day, then payment of the interest payable on such date will be made on the next succeeding day that is a Business Day (and without any interest or other payment in respect of any such delay), with the same force and effect as if made on the date the payment was originally payable.  A “Business Day” shall mean any day other than a Saturday or a Sunday or a day on which banking institutions in New York City are authorized or required by law or executive order to remain closed or a day on which the Corporate Trust Office of the Trustee is closed for business.

 

Payment of the principal of and interest due at the Stated Maturity or earlier redemption of the Series 2009A Notes shall be made upon surrender of the Series 2009A Notes at the Corporate Trust Office of the Trustee.  The principal of and interest on the Series 2009A Notes shall be paid in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.  Payment of interest (including interest on an Interest Payment Date) will be made, subject to such surrender where applicable, at the option of the Company, (i) by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or (ii) by wire transfer or other electronic transfer at such place and to such account at a banking institution in the United States as may be designated in writing to the Trustee at least 16
days prior to the date for payment by the Person entitled thereto.

 

REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.

 

Unless the certificate of authentication hereon has been executed by the Trustee by manual signature, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

 

            IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal.

 

Dated:  

 

	
             
 	
            THE SOUTHERN COMPANY

 

 

 

By:       _______________________________

Vice President

 
 

 

 

Attest:

 

 

Assistant Secretary

 

 

{Seal of THE SOUTHERN COMPANY appears here}

 

 

CERTIFICATE OF AUTHENTICATION

 

	
             
 	
            This is one of the Senior Notes referred to in the within-mentioned Indenture.
 

 

	
             
 	
            WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee

 

 

By:                                                                                                                                                                                                                                                                             

Authorized Officer

 
 

 

 

                                          
                                   (Reverse Side of Note)

 

This Note is one of a duly authorized issue of Senior Notes of the Company (the “Notes”), issued and issuable in one or more series under a Senior Note Indenture, dated as of January 1, 2007, as supplemented (the “Indenture”), between the Company and Wells Fargo Bank, National Association, Trustee (the “Trustee,” which term includes any successor trustee under the Indenture), to which Indenture and all indentures incidental thereto reference is hereby made for a statement of the respective rights, limitation of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Notes issued thereunder and of the terms upon which said Notes are, and are to be, authenticated and delivered.  This Note is one of the series designated on the face hereof as Series 2009A 4.15% Senior Notes due May 15, 2014 (the “Series 2009A
Notes”) which is unlimited in aggregate principal amount.  Capitalized terms used herein for which no definition is provided herein shall have the meanings set forth in the Indenture.

 

	
             
	
            The Series 2009A Notes will not have a sinking fund.

 

The Series 2009A Notes will be subject to redemption at the option of the Company in whole or in part, at any time and from time to time, upon not less than 30 nor more than 60 days’ notice.  The Company shall have the right to redeem the Series 2009A Notes in whole or in part at redemption prices (each, a “Redemption Price”) equal to the greater of (i) 100% of the principal amount of the Series 2009A Notes to be redeemed or (ii) the sum of the present values of the remaining scheduled payments of principal and interest on the Series 2009A Notes being redeemed (not including any portion of such payments of interest accrued to the Redemption Date) discounted (for purposes of determining present value) to the Redemption Date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at a
discount rate equal to the Treasury Yield plus 35 basis points, plus, in each case, accrued interest thereon to the Redemption Date.

 

 “Treasury Yield” means, with respect to any Redemption Date, the rate per annum equal to the semiannual equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such Redemption Date.

 

 “Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Series 2009A Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the Series 2009A Notes.

 

 “Comparable Treasury Price” means, with respect to any Redemption Date, (i) the average of the Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and lowest of such Reference Treasury Dealer Quotations or (ii) if the Company obtains fewer than four of such Reference Treasury Dealer Quotations, the average of all such quotations.

 

 

 “Independent Investment Banker” means an independent investment banking institution of national standing appointed by the Company.

 

 “Reference Treasury Dealer” means a primary United States Government securities dealer in the United States appointed by the Company.

 

 “Reference Treasury Dealer Quotation” means, with respect to each Reference Treasury Dealer and any Redemption Date, the average, as determined by the Company, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount and quoted in writing to the Company by such Reference Treasury Dealer at 5:00 p.m. on the third Business Day in New York City preceding such Redemption Date).

 

The Trustee shall not be responsible for the calculation of the Redemption Price.  The Company shall calculate the Redemption Price and promptly notify the Trustee thereof.

 

In the event of redemption of this Note in part only, a new Note or Notes of this series for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the surrender hereof.  The Series 2009A Notes will not have a sinking fund.

 

If an Event of Default with respect to the Notes of this series shall occur and be continuing, the principal of the Notes of this series may be declared due and payable in the manner, with the effect and subject to the conditions provided in the Indenture.

 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Notes of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of not less than a majority in principal amount of the Notes at the time Outstanding of each series to be affected.  The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Notes of each series at the time Outstanding, on behalf of the Holders of all Notes of such series, to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences.  Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such
Holder and upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not notation of such consent or waiver is made upon this Note.

 

No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, place and rate, and in the coin or currency, herein prescribed.

 

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Note is registrable in the Security Register, upon surrender of this Note for registration of transfer at the office or agency of the Company for such purpose, duly endorsed by, or accompanied 

 

by a written instrument of transfer in form satisfactory to the Company and the Security Registrar and duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes of this series, of authorized denominations and of like tenor and for the same aggregate principal amount, will be issued to the designated transferee or transferees.  No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.

 

Prior to due presentment of this Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Note is registered as the owner hereof for all purposes, whether or not this Note be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary.

 

The Notes of this series are issuable only in registered form without coupons in denominations of $1,000 and any integral multiple thereof.  As provided in the Indenture and subject to certain limitations therein set forth, Notes of this series are exchangeable for a like aggregate principal amount of Notes of this series of a different authorized denomination, as requested by the Holder surrendering the same upon surrender of the Note or Notes to be exchanged at the office or agency of the Company.

 

This Note shall be governed by, and construed in accordance with, the internal laws of the State of New York.

 

	
             
 	
            ABBREVIATIONS
 

 

The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they were written out in full according to applicable laws or regulations:

 

	
            TEN COM-      as tenants in

common
 	
            UNIF GIFT MIN ACT- _______ Custodian ________

(Cust)                           (Minor)
 
	
            TEN ENT-       as tenants by the

entireties
 	
             
 
	
            JT TEN-            as joint tenants

with right of

survivorship and

not as tenants

in common

 
 	
            under Uniform Gifts to

Minors Act

 

________________________

(State)
 

 

Additional abbreviations may also be used

though not on the above list.

 

	
             
 	
            FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto
 

_______________________________________________________________________________

(please insert Social Security or other identifying number of assignee)

 

_______________________________________________________________________________

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF ASSIGNEE

_______________________________________________________________________________

 

_______________________________________________________________________________

the within Note and all rights thereunder, hereby irrevocably constituting and appointing

_______________________________________________________________________________

 

_______________________________________________________________________________

agent to transfer said Note on the books of the Company, with full power of substitution in the premises.

 

	
            Dated: ____________
 	
            ________________________________________________
 

 

	
             
 	
            ________________________________________________
 

 

NOTICE:  The signature to this assignment must correspond with the name as written upon the face of the within instrument in every particular without alteration or enlargement, or any change whatever.

 

 

	
             
 	
            EXHIBIT B
 

 

 

	
             
 	
            CERTIFICATE OF AUTHENTICATION
 

 

 

	
             
 	
            This is one of the Senior Notes referred to in the within-mentioned Indenture.
 

 

	
             
 	
            WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee

 

 

By:        ____________________________

Authorized Officer

 

 
 

 

 

B-1

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