Document:

Exhibit 4.3

                              THE SOUTHERN COMPANY

                              EMPLOYEE SAVINGS PLAN

                             As Amended and Restated
                           Effective December 20, 2006

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                                TABLE OF CONTENTS

ARTICLE I PURPOSE............................................................1

ARTICLE II DEFINITIONS.......................................................2
         2.1      "Account"..................................................2
         2.2      "Actual Contribution Percentage Test"......................2
         2.3      "Actual Deferral Percentage"...............................2
         2.4      "Actual Deferral Percentage Test"..........................2
         2.5      "Administrative Committee".................................3
         2.6      "Affiliated Employer"......................................3
         2.7      "Aggregate Account"........................................3
         2.8      "Aggregation Group"........................................3
         2.9      "Annual Addition"..........................................3
         2.10     "Average Actual Deferral Percentage".......................4
         2.11     "Average Contribution Percentage"..........................4
         2.12     "Beneficiary"..............................................4
         2.13     "Board of Directors".......................................4
         2.14     "Break-in-Service Date"....................................4
         2.15     "Code".....................................................4
         2.16     "Common Stock".............................................4
         2.17     "Company"..................................................4
         2.18     "Company Stock Fund".......................................5
         2.19     "Compensation".............................................5
         2.20     "Contribution Percentage"..................................5
         2.21     "Determination Date".......................................5
         2.22     "Determination Year".......................................5
         2.23     "Direct Rollover"..........................................6
         2.24     "Distributee"..............................................6
         2.25     "Elective Employer Contribution"...........................6
         2.26     "Eligible Employee"........................................6
         2.27     "Eligible Participant".....................................6
         2.28     "Eligible Retirement Plan".................................6
         2.29     "Eligible Rollover Distribution"...........................7
         2.30     "Employee".................................................7
         2.31     "Employee Stock Ownership Plan"............................7
         2.32     "Employer Matching Contribution"...........................7
         2.33     "Employing Company"........................................7
         2.34     "Enrollment Date"..........................................7
         2.35     "ERISA"....................................................7
         2.36     "Excess Aggregate Contributions"...........................7
         2.37     "Excess Deferral Amount"...................................7
         2.38     "Excess Deferral Contributions"............................8
         2.39     "Highly Compensated Employee"..............................8
         2.40     "Hour of Service"..........................................8

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         2.41     "Investment Fund"..........................................8
         2.42     "Key Employee".............................................8
         2.43     "Limitation Year"..........................................8
         2.44     "Look-Back Year"...........................................8
         2.45     "Mirant"...................................................8
         2.46     "Non Highly Compensated Employee"..........................8
         2.47     "Normal Retirement Date"...................................8
         2.48     "One-Year Break in Service"................................8
         2.49     "Participant"..............................................8
         2.50     "Pension Fund Investment Review Committee".................9
         2.51     "Performance Sharing Plan".................................9
         2.52     "Permissive Aggregation Group".............................9
         2.53     "Plan".....................................................9
         2.54     "Plan of Reorganization"...................................9
         2.55     "Plan Year"................................................9
         2.56     "Present Value of Accrued Retirement Income"...............9
         2.57     "Required Aggregation Group"...............................9
         2.58     "Rollover Contribution"....................................9
         2.59     "SEPCO"...................................................10
         2.60     "SEPCO Plan"..............................................10
         2.61     "SEPCO Transferred Account"...............................10
         2.62     "Super-Top-Heavy Group"...................................10
         2.63     "Surviving Spouse"........................................10
         2.64     "Top-Heavy Group".........................................10
         2.65     "Trust" or "Trust Fund"...................................10
         2.66     "Trust Agreement".........................................10
         2.67     "Trustee".................................................10
         2.68     "Valuation Date"..........................................10
         2.69     "Voluntary Participant Contribution"......................10
         2.70     "Year of Service".........................................10

ARTICLE III PARTICIPATION...................................................12
         3.1      Eligibility Requirements..................................12
         3.2      Participation upon Reemployment...........................12
         3.3      No Restoration of Previously Distributed Benefits.........12
         3.4      Loss of Eligible Employee Status..........................12
         3.5      Military Leave............................................13

ARTICLE IV ELECTIVE EMPLOYER CONTRIBUTIONS AND VOLUNTARY
         PARTICIPANT CONTRIBUTIONS..........................................14
         4.1      Elective Employer Contributions...........................14
         4.2      Maximum Amount of Elective Employer Contributions.........14
         4.3      Distribution of Excess Deferral Amounts...................14
         4.4      Additional Rules Regarding Elective Employer
                  Contributions.............................................15
         4.5      Section 401(k) Nondiscrimination Tests....................16
         4.6      Voluntary Participant Contributions.......................19

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         4.7      Manner and Time of Payment of Elective Employer
                  Contributions and Voluntary Participant
                  Contributions.............................................19
         4.8      Change in Contribution Rate...............................19
         4.9      Change in Contribution Amount.............................19
         4.10     Rollovers from Other Plans................................19
         4.11     Catch-Up Contributions....................................20

ARTICLE V EMPLOYER MATCHING CONTRIBUTIONS...................................21
         5.1      Amount of Employer Matching Contributions.................21
         5.2      Payment of Employer Matching Contributions................21
         5.3      Limitations on Employer Matching Contributions
                  and Voluntary Participant Contributions...................21
         5.4      Reversion of Employing Company Contributions..............23
         5.5      Correction of Prior Incorrect Allocations and
                  Distributions.............................................24

ARTICLE VI LIMITATIONS ON CONTRIBUTIONS.....................................25
         6.1      Section 415 Limitations...................................25
         6.2      Correction of Contributions in Excess of Section
                  415 Limits................................................25
         6.3      Combination of Plans......................................26

ARTICLE VII SUSPENSION OF CONTRIBUTIONS.....................................27
         7.1      Suspension of Contributions...............................27
         7.2      Resumption of Contributions...............................27

ARTICLE VIII INVESTMENT OF CONTRIBUTIONS....................................28
         8.1      Investment Funds..........................................28
         8.2      Investment of Contributions...............................28
         8.3      Investment of Earnings....................................28
         8.4      Transfer of Assets between Funds..........................28
         8.5      Change in Investment Direction............................28
         8.6      Section 404(c) Plan.......................................29
         8.7      Suspension, Discontinuance or Restriction of
                  Trading...................................................29
         8.8      Designated Net Litigation Distributions...................29

ARTICLE IX MAINTENANCE AND VALUATION OF PARTICIPANTS' ACCOUNTS..............30
         9.1      Establishment of Accounts.................................30
         9.2      Valuation of Investment Funds.............................31
         9.3      Rights in Investment Funds................................31

ARTICLE X VESTING...........................................................32
         10.1     Vesting...................................................32

ARTICLE XI WITHDRAWALS AND LOANS............................................33
         11.1     Withdrawals by Participants...............................33
         11.2     Notice of Withdrawal......................................34
         11.3     Form of Withdrawal........................................34

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         11.4     Minimum Withdrawal........................................34
         11.5     Source of Withdrawal......................................34
         11.6     Requirement of Hardship...................................34
         11.7     Loans to Participants.....................................36
         11.8     Special Waiver for Participants Employed in the
                  United Kingdom............................................38

ARTICLE XII DISTRIBUTION TO PARTICIPANTS....................................39
         12.1     Distribution upon Retirement..............................39
         12.2     Distribution upon Disability..............................40
         12.3     Distribution upon Death...................................40
         12.4     Designation of Beneficiary in the Event of Death..........40
         12.5     Distribution upon Termination of Employment...............41
         12.6     Commencement of Benefits..................................41
         12.7     Transfer between Employing Companies......................42
         12.8     Distributions to Alternate Payees.........................42
         12.9     Requirement for Direct Rollovers..........................43
         12.10    Consent and Notice Requirements...........................43
         12.11    Form of Payment...........................................43
         12.12    Partial Distribution upon Termination of
                  Employment................................................44
         12.13    Distribution of Dividends Payable on Common Stock.........44
         12.14    Qualified Hurricane Distributions.........................45

ARTICLE XIII ADMINISTRATION OF THE PLAN.....................................48
         13.1     Membership of Administrative Committee....................48
         13.2     Term......................................................48
         13.3     Transaction of Business...................................48
         13.4     Administrative Committee Responsibilities in
                  General...................................................48
         13.5     Administrative Committee and Pension Fund
                  Investment Review Committee as Named Fiduciaries..........49
         13.6     Rules for Plan Administration.............................49
         13.7     Employment of Agents......................................49
         13.8     Co-Fiduciaries............................................49
         13.9     General Records...........................................50
         13.10    Liability of the Administrative Committee.................50
         13.11    Reimbursement of Expenses and Compensation of
                  Administrative Committee..................................50
         13.12    Expenses of Plan and Trust Fund...........................50
         13.13    Responsibility for Funding Policy.........................51
         13.14    Management of Assets......................................51
         13.15    Notice and Claims Procedures..............................51
         13.16    Bonding...................................................52
         13.17    Multiple Fiduciary Capacities.............................52

ARTICLE XIV TRUSTEE OF THE PLAN.............................................53
         14.1     Trustee...................................................53
         14.2     Purchase of Common Stock..................................53
         14.3     Voting of Common Stock....................................53

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         14.4     Voting of Other Investment Fund Shares....................54
         14.5     Uninvested Amounts........................................54
         14.6     Independent Accounting....................................54

ARTICLE XV AMENDMENT AND TERMINATION OF THE PLAN............................55
         15.1     Amendment of the Plan.....................................55
         15.2     Termination of the Plan...................................55
         15.3     Merger or Consolidation of the Plan.......................56

ARTICLE XVI TOP HEAVY REQUIREMENTS..........................................57
         16.1     Top-Heavy Plan Requirements...............................57
         16.2     Determination of Top-Heavy Status.........................57
         16.3     Minimum Allocation for Top-Heavy Plan Years...............58

ARTICLE XVII GENERAL PROVISIONS.............................................60
         17.1     Plan Not an Employment Contract...........................60
         17.2     No Right of Assignment or Alienation......................60
         17.3     Payment to Minors and Others..............................60
         17.4     Source of Benefits........................................61
         17.5     Unclaimed Benefits........................................61
         17.6     Governing Law.............................................61

ARTICLE XVIII SPECIAL REQUIREMENTS FOR ACCOUNT BALANCES
         ATTRIBUTABLE TO ACCRUED BENEFITS TRANSFERRED FROM THE
         SEPCO PLAN.........................................................62
         18.1     SEPCO Transferred Accounts................................62
         18.2     In-Service Withdrawals from SEPCO Transferred
                  Accounts..................................................62
         18.3     Loans from SEPCO Transferred Accounts.....................62
         18.4     Distribution of SEPCO Transferred Accounts................63
         18.5     Code Section 411(d)(6) Protected Benefits.................64

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                              THE SOUTHERN COMPANY

                              EMPLOYEE SAVINGS PLAN

                             As Amended and Restated
                           Effective December 20, 2006

                                    ARTICLE I
                                     PURPOSE

         The purpose of the Plan is to encourage employee thrift, to supplement
retirement and death benefits, and to create a competitive compensation program
for employees through the establishment of a formal plan under which
contributions by and on behalf of Participants are supplemented by contributions
of Employing Companies. This Plan is intended to be a stock bonus plan, and all
contributions made by an Employing Company to this Plan are expressly
conditioned upon the deductibility of such contributions under Code Section 404.
In addition, the Company Stock Fund under the Plan is also intended to be an
employee stock ownership plan, as defined in Code Section 4975(e)(7) and ERISA
Section 407(d)(6). The Plan was originally effective March 1, 1976, and was most
recently amended and restated effective as of December 20, 2006, to provide for
the merger of The Southern Company Employee Stock Ownership Plan into the Plan,
as well as to incorporate a variety of plan design and other changes.

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                                   ARTICLE II

                                   DEFINITIONS

     All references to articles, sections, subsections, and paragraphs shall be
to articles, sections, subsections, and paragraphs of this Plan unless another
reference is expressly set forth in this Plan. Any words used in the masculine
shall be read and be construed in the feminine where they would so apply. Words
in the singular shall be read and construed in the plural, and all words in the
plural shall be read and construed in the singular in all cases where they would
so apply.

     For purposes of this Plan, unless otherwise required by the context, the
following terms shall have the meanings set forth opposite such terms:

     2.1 "Account" shall mean the total amount credited to the account of a
Participant, as described in Section 9.1.

     2.2 "Actual Contribution Percentage Test" shall mean the test described in
Section 5.3(a).

     2.3 "Actual Deferral Percentage" shall mean the ratio (expressed as a
percentage) of Elective Employer Contributions on behalf of an Eligible
Participant for the Plan Year to the Eligible Participant's compensation for the
Plan Year. For the purpose of determining an Eligible Participant's Actual
Deferral Percentage for a Plan Year, the Administrative Committee may elect to
consider an Eligible Participant's compensation for (a) the entire Plan Year or
(b) that portion of the Plan Year in which the Eligible Participant was eligible
to have Elective Employer Contributions made on his behalf, provided that such
election is applied uniformly to all Eligible Participants for the Plan Year.
For purposes of this Section 2.3, "compensation" shall mean actual compensation
for services rendered or paid by the employer to an Eligible Participant which
is currently includible in the Eligible Participant's gross income, as reported
on the Eligible Participant's Federal Income Tax Withholding Statement (Form
W-2), plus (i) an Eligible Participant's elective deferrals under Code Sections
402(g)(3) and 414(v), (ii) amounts contributed or deferred under Code Section
125 by the employer at the Eligible Participant's election that are not
includible in the Eligible Participant's gross income, and (iii) amounts which
are not includible in an Eligible Participant's gross income by reason of Code
Sections 132(f)(4) or 457. Compensation also shall be limited pursuant to Code
Section 401(a)(17). The Actual Deferral Percentage of an Eligible Participant
who does not have Elective Employer Contributions made on his behalf shall be
zero.

     2.4 "Actual Deferral Percentage Test" shall mean the test described in
Section 4.5(a).

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     2.5 "Administrative Committee" shall mean the administrative committee
appointed pursuant to Section 13.1 to serve as plan administrator. Its formal
title is the Southern Company Employee Savings Plan Committee.

     2.6 "Affiliated Employer" shall mean an Employing Company and (a) any
corporation which is a member of a controlled group of corporations (as defined
in Section 414(b) of the Code) which includes such Employing Company, (b) any
trade or business (whether or not incorporated) which is under common control
(as defined in Section 414(c) of the Code) with such Employing Company, (c) any
organization (whether or not incorporated) which is a member of an affiliated
service group (as defined in Section 414(m) of the Code) which includes such
Employing Company, and (d) any other entity required to be aggregated with such
Employing Company pursuant to regulations under Section 414(o) of the Code.
Notwithstanding the foregoing, for purposes of applying the limitations of
Article VI, the term Affiliated Employer shall be adjusted as required by Code
Section 415(h).

     2.7 "Aggregate Account" shall mean with respect to a Participant as of the
Determination Date, the sum of the following:

          (a) the Account balance of such Participant as of the most recent
     valuation occurring within a twelve-month period ending on the
     Determination Date;

          (b) an adjustment for any contributions due as of the Determination
     Date;

          (c) any Plan distributions, including unrelated rollovers and
     plan-to-plan transfers (ones which are both initiated by the Employee and
     made from a plan maintained by one employer to a plan maintained by another
     employer), but not related rollovers or plan-to-plan transfers (ones either
     not initiated by the Employee or made to a plan maintained by the same
     employer), made within the one-year period ending on the Determination
     Date. The preceding sentence shall also apply to distributions under a
     terminated plan which if it had not been terminated would have been
     required to be included in an Aggregation Group. In the case of a
     distribution made for a reason other than severance from employment (or
     separation from service), death or disability, this provision shall be
     applied by substituting "five-year period" for "one-year period";

          (d) any Employee contributions, whether voluntary or mandatory;

          (e) unrelated rollovers and plan-to-plan transfers to this Plan
     accepted prior to January 1, 1984; and

          (f) related rollovers and plan-to-plan transfers to this Plan.

     2.8 "Aggregation Group" shall mean either a Required Aggregation Group or a
Permissive Aggregation Group.

     2.9 "Annual Addition" shall mean the amount allocated to a Participant's
Account and accounts under all defined contribution plans maintained by the
Affiliated Employers during a Limitation Year that constitutes

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          (a) Affiliated Employer contributions,

          (b) Voluntary Participant Contributions,

          (c) forfeitures, if any, allocated to a Participant's Account or
     accounts under all defined contribution plans maintained by the Affiliated
     Employers, and

          (d) amounts described in Sections 415(l)(1) and 419A(d)(2) of the
     Code.

     2.10 "Average Actual Deferral Percentage" shall mean the average (expressed
as a percentage) of the Actual Deferral Percentages of the Eligible Participants
in a group.

     2.11 "Average Contribution Percentage" shall mean the average (expressed as
a percentage) of the Contribution Percentages of the Eligible Participants in a
group.

     2.12 "Beneficiary" shall mean any person(s) who, or estate(s), trust(s), or
organization(s) which, in accordance with the provisions of Section 12.4, become
entitled to receive benefits upon the death of a Participant.

     2.13 "Board of Directors" shall mean the Board of Directors of Southern
Company Services, Inc.

     2.14 "Break-in-Service Date"means the earlier of:

          (a) the date on which an Employee terminates employment, is
     discharged, retires, or dies; or

          (b) the last day of an approved leave of absence including any
     extension.

     In the case of an individual who is absent from work for maternity or
paternity reasons, such individual shall not incur a Break-in-Service Date
earlier than the expiration of the second anniversary of the first date of such
absence; provided, however, that the twelve-consecutive-month period beginning
on the first anniversary of the first date of such absence shall not constitute
a Year of Service. For purposes of this paragraph, an absence from work for
maternity or paternity reasons means an absence (a) by reason of the pregnancy
of the Employee, (b) by reason of a birth of a child of the Employee, (c) by
reason of the placement of a child with the Employee in connection with the
adoption of such child by such Employee, or (d) for purposes of caring for such
child for a period beginning immediately following such birth or placement.

     2.15 "Code" shall mean the Internal Revenue Code of 1986, as amended, or
any successor statute, and the rulings and regulations promulgated thereunder.
In the event an amendment to the Code renumbers a section of the Code referred
to in this Plan, any such reference automatically shall become a reference to
such section as renumbered.

     2.16 "Common Stock" shall mean the common stock of The Southern Company.

     2.17 "Company" shall mean Southern Company Services, Inc., and its
successors.

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     2.18 "Company Stock Fund" shall mean the fund under the Plan invested in
Common Stock as described in Section 8.1.

     2.19 "Compensation" shall mean the salary or wages of a Participant,
including all amounts contributed by an Employing Company to The Southern
Company Flexible Benefits Plan on behalf of a Participant pursuant to a salary
reduction arrangement under such plan, plus monthly shift and monthly seven-day
schedule differentials, geographic premiums, monthly customer service premiums,
monthly nuclear plant premiums, sales commissions paid under a sales commission
payment program sponsored by an Employing Company for sales commissioned based
employees, and overtime pay resulting from fluctuations in a Participant's
weekly hours worked pursuant to a pre-determined flexible work schedule
established or approved by an Employing Company that is intended to produce, on
average, forty (40) hour work weeks, and before deduction of taxes, social
security, etc., but excluding all awards under any incentive pay plans sponsored
by the Employing Company, overtime pay (except as specifically included above),
any hourly shift differentials, substitution pay, such amounts which are
reimbursements to a Participant paid by any Employing Company, including but not
limited to, reimbursement for such items as moving expenses and travel and
entertainment expenses, and imputed income for automobile expenses, tax
preparation expenses and health and life insurance premiums paid by the
Employing Company.

     The Compensation of each Participant taken into account for purposes of
this Plan shall not exceed the applicable limit under Code Section 401(a)(17).

     2.20 "Contribution Percentage" shall mean the ratio (expressed as a
percentage), of the sum of the Voluntary Participant Contributions and Employer
Matching Contributions under the Plan on behalf of the Eligible Participant for
the Plan Year to the Eligible Participant's compensation for the Plan Year. For
the purpose of determining an Eligible Participant's Contribution Percentage for
a Plan Year, the Administrative Committee may elect to consider an Eligible
Participant's compensation for (a) the entire Plan Year or (b) that portion of
the Plan Year in which the individual is an Eligible Participant, provided that
such election is applied uniformly to all Eligible Participants for the Plan
Year. For purposes of this Section 2.20, "compensation" shall mean actual
compensation for services rendered or paid by the employer to an Eligible
Participant which is currently includible in the Eligible Participant's gross
income, as reported on the Eligible Participant's Federal Income Tax Withholding
Statement (Form W-2), plus (i) an Eligible Participant's elective deferrals
under Code Sections 402(g)(3) and 414(v), (ii) amounts contributed or deferred
under Code Section 125 by the employer at the Eligible Participant's election
that are not includable in the Eligible Participant's gross income, and (iii)
amounts which are not includable in an Eligible Participant's gross income by
reason of Code Sections 132(f)(4) or 457. Compensation also shall be limited
pursuant to Code Section 401(a)(17). The Contribution Percentage of an Eligible
Participant who does not make Voluntary Participant Contributions or have
Employer Matching Contributions made on his behalf shall be zero.

     2.21 "Determination Date" shall mean with respect to a Plan Year, the last
day of the preceding Plan Year.

     2.22 "Determination Year" shall mean the Plan Year being tested.

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     2.23 "Direct Rollover" shall mean a payment by the Plan to the Eligible
Retirement Plan specified by the Distributee.

     2.24 "Distributee" shall include an Employee or former Employee. In
addition, Distributee shall include the Employee's or former Employee's
surviving spouse, the Employee's or former Employee's spouse or former spouse
who is an alternate payee under a qualified domestic relations order (as defined
in Section 414(p) of the Code), and, for Plan Years beginning on or after
January 1, 2007, the Employee's or former Employee's Beneficiary or
Beneficiaries.

     2.25 "Elective Employer Contribution" shall mean contributions made
pursuant to Section 4.1 during the Plan Year by an Employing Company, at the
election of the Participant, in lieu of cash compensation and shall include
contributions made pursuant to a salary reduction agreement.

     2.26 "Eligible Employee" shall mean an Employee who is employed by an
Employing Company and (a) who was eligible to be included in the Plan on January
1, 1991, or (b) who is a regular full-time or regular part-time employee, and
excluding:

          (1) an individual who is classified by an Employing Company as a
     leased employee, regardless of whether such classification is determined to
     be in error;

          (2) any Employee who is represented by a collective bargaining agent
     unless the representatives of his bargaining unit and the Employing Company
     mutually agree to participation in the Plan subject to its terms by members
     of his bargaining unit;

          (3) an individual who is a cooperative education employee; and

          (4) an individual who is classified by the Employing Company as a
     temporary employee (who was not eligible to be included in the Plan on
     January 1, 1991) or an independent contractor, regardless of whether such
     classification is determined to be in error. Effective September 1, 1998,
     any individual classified by the Employing Company as a temporary employee
     shall be excluded from the Plan, regardless of any prior inclusion in the
     Plan and regardless of whether the "temporary employee" classification is
     determined to be in error.

     2.27 "Eligible Participant" shall mean an Eligible Employee who is
authorized to have Elective Employer Contributions or Voluntary Participant
Contributions allocated to his Account for the Plan Year.

     2.28 "Eligible Retirement Plan" shall mean an individual retirement account
described in Section 408(a) of the Code, an individual retirement annuity
described in Section 408(b) of the Code, an annuity plan described in Section
403(a) of the Code, a plan described in Section 403(b) of the Code, a plan
described in Section 457(b) of the Code which is maintained by a state, an
agency or instrumentality of a state or political subdivision of a state and
which agrees to separately account for amounts transferred into such plan from
this Plan, or a qualified trust described in Section 401(a) of the Code that

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accepts the Distributee's Eligible Rollover Distribution.

     2.29 "Eligible Rollover Distribution" shall mean any distribution of all or
any portion of the balance to the credit of the Distributee, except that an
Eligible Rollover Distribution does not include: (a) any distribution that is
one of a series of substantially equal periodic payments (not less frequently
than annually) made for the life (or life expectancy) of the Distributee, the
joint lives (or joint life expectancies) of the Distributee and the
Distributee's Beneficiary, or for a specified period of 10 years or more; (b)
any distribution to the extent such distribution is required under Section
401(a)(9) of the Code; (c) any hardship distribution described in Section
401(k)(2)(B)(i)(IV) of the Code; and (d) for Plan Years prior to January 1,
2007, the portion of any distribution that is not includible in gross income
(determined without regard to the exclusion from net unrealized appreciation
with respect to employer securities).

     2.30 "Employee" shall mean each individual who is employed by an Affiliated
Employer under common law and each individual who is required to be treated as
an employee pursuant to the "leased employee" rules of Code Section 414(n) other
than a leased employee described in Code Section 414(n)(5).

     2.31 "Employee Stock Ownership Plan" shall mean The Southern Company
Employee Stock Ownership Plan, as such plan existed prior to December 20, 2006.

     2.32 "Employer Matching Contribution" shall mean a contribution made by an
Employing Company pursuant to Section 5.1 with respect to Elective Employer
Contributions and Voluntary Participant Contributions made on behalf of each
Participant each payroll period.

     2.33 "Employing Company" shall mean the Company and any affiliate or
subsidiary of The Southern Company which the Board of Directors may from time to
time determine to bring under the Plan and which shall adopt the Plan, and any
successor of them. The Employing Companies are set forth on Appendix A to the
Plan as updated from time to time. No such entity shall be treated as an
Employing Company prior to the date it adopts the Plan.

     2.34 "Enrollment Date" shall mean the first day of each payroll period.

     2.35 "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended, or any successor statute, and the rulings and regulations
promulgated thereunder. In the event an amendment to ERISA renumbers a section
of ERISA referred to in this Plan, any such reference automatically shall become
a reference to such section as renumbered.

     2.36 "Excess Aggregate Contributions" shall mean the amount referred to in
Code Section 401(m)(6)(B) with respect to a Participant. In no event may the
Excess Aggregate Contributions for any Highly Compensated Employee exceed the
amount of the Employer Matching Contributions or Voluntary Participant
Contributions made on behalf of the Highly Compensated Employee for the Plan
Year.

     2.37 "Excess Deferral Amount" shall mean the amount of Elective Employer
Contributions for a calendar year that exceed the Code Section 402(g) limits as
allocated to this Plan pursuant to Section 4.3(b).

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     2.38 "Excess Deferral Contributions" shall mean the amount of Elective
Employer Contributions on behalf of a Highly Compensated Employee referred to in
Code Section 401(k)(8)(B).

     2.39 "Highly Compensated Employee" shall mean (in accordance with and
subject to Code Section 414(q) and any regulations, rulings, notices or
procedures thereunder), with respect to any Plan Year: (1) any Employee who was
a five percent (5%) owner of The Southern Company or an Affiliated Employer (as
determined pursuant to Code Section 416) during the Plan Year or the immediately
preceding Plan Year, or (2) any Employee who had compensation in excess of
$80,000 in the preceding Plan Year. The $80,000 amount shall be adjusted for
inflation and for short Plan Years, pursuant to Code Section 414(q). The
Employer may, at its election, limit Employees who had compensation in excess of
$80,000 to only those Employees who fall within the "top-paid group," as defined
in Code Section 414(q) excluding those employees described in Code Section
414(q)(8) for such purpose. In determining whether an Employee is a Highly
Compensated Employee, the Administrative Committee may make any elections
authorized under applicable regulations, rulings, notices, or revenue
procedures. For purposes of this Section 2.39, "compensation" shall mean
compensation within the meaning of Code Section 415(c)(3).

     2.40 "Hour of Service" shall mean each hour for which an Employee is paid,
or entitled to payment, for the performance of duties for an Affiliated
Employer.

     2.41 "Investment Fund" shall mean any one of the funds described in Article
VIII which constitutes part of the Trust Fund.

     2.42 "Key Employee" shall mean any Employee or former Employee (and his
Beneficiary) who is a key employee within the meaning of Code Section 416(i)(1).

     2.43 "Limitation Year" shall mean the Plan Year.

     2.44 "Look-Back Year" shall mean the Plan Year preceding the Determination
Year.

     2.45 "Mirant" shall mean Mirant Corporation, any subsidiary of Mirant
Corporation, or any successor thereto.

     2.46 "Non Highly Compensated Employee" shall mean an Employee who is not a
Highly Compensated Employee.

     2.47 "Normal Retirement Date" shall mean the first day of the month
following a Participant's sixty-fifth (65th) birthday.

     2.48 "One-Year Break in Service" shall mean each twelve-consecutive-month
period within the period commencing with an Employee's Break-in-Service Date and
ending on the date the Employee is again credited with an Hour of Service.

     2.49 "Participant" shall mean (a) an Eligible Employee who has elected to
participate in the Plan as provided in Article III and whose participation in
the Plan at the time of reference has not been terminated as provided in the
Plan, (b) an Employee or former Employee who has ceased to be a Participant

                                       8
<PAGE>

under (a) above, but for whom an Account is maintained under the Plan, (c) an
Eligible Employee who has made a Rollover Contribution to this Plan to the
extent that the Provisions of the Plan apply to such Rollover Contribution of
the Eligible Employee, (d) an Employee or former Employee for whom an Account is
maintained for amounts transferred to the Plan from the Performance Sharing
Plan, and (e) an Employee or former Employee for whom an Account is maintained
for amounts transferred to the Plan from the Employee Stock Ownership Plan.

     2.50 "Pension Fund Investment Review Committee"shall mean the Pension Fund
Investment Review Committee of The Southern Company System appointed pursuant to
Section 13.4.

     2.51 "Performance Sharing Plan" shall mean The Southern Company Performance
Sharing Plan, as such plan existed prior to June 21, 2002.

     2.52 "Permissive Aggregation Group" shall mean a group of plans consisting
of the Required Aggregation Group and, at the election of the Affiliated
Employers, such other plan or plans not required to be included in the Required
Aggregation Group, provided the resulting group, taken as a whole, would
continue to satisfy the provisions of Code Section 401(a)(4) and 410.

     2.53 "Plan" shall mean The Southern Company Employee Savings Plan, as
described herein or as from time to time amended.

     2.54 "Plan of Reorganization" shall mean the Second Amended Joint Chapter
11 Plan of Reorganization for Mirant Corporation and its Affiliated Debtors.

     2.55 "Plan Year" shall mean the twelve-month period commencing January 1st
and ending on the last day of December next following.

     2.56 "Present Value of Accrued Retirement Income" shall mean an amount
determined solely for the purpose of determining if the Plan, or any other plan
included in a Required Aggregation Group of which the Plan is a part, is top
heavy in accordance with Code Section 416.

     2.57 "Required Aggregation Group" shall mean those plans that are required
to be aggregated as determined under this Section 2.57. In determining a
Required Aggregation Group hereunder, each plan of the Affiliated Employers in
which a Key Employee is a participant and each other plan of the Affiliated
Employers which enables any plan in which a Key Employee participates to meet
the requirements of Code Section 410 or 401(a)(4) will be required to be
aggregated.

     2.58 "Rollover Contribution" shall mean that portion of an eligible
rollover distribution that an Eligible Employee elects to contribute to this
Plan in accordance with the requirements of Section 4.10. The Plan will accept a
direct rollover of an eligible rollover distribution from (a) a qualified plan
described in Code Section 401(a) or 403(a), (b) an annuity contract described in
Code Section 403(b), or (c) an eligible plan under Code Section 457(b). In
addition, the Plan will accept a Rollover Contribution from a conduit individual

                                       9
<PAGE>

retirement account or annuity ("IRA"). However, in no event shall the Plan
accept after-tax employee contributions as a Rollover Contribution.

     2.59 "SEPCO" shall mean Savannah Electric and Power Company.

     2.60 "SEPCO Plan" shall mean the Employee Savings Plan of Savannah Electric
and Power Company as in effect December 31, 1992.

     2.61 "SEPCO Transferred Account" shall mean the total amount credited to
the account of a Participant as described in Section 9.1(b).

     2.62 "Super-Top-Heavy Group" shall mean an Aggregation Group that would be
a Top-Heavy Group if 90% were substituted for 60% in Section 2.64.

     2.63 "Surviving Spouse" shall mean the person to whom the Participant is
married on the date of his death, if such spouse is then living, provided that
the Participant and such spouse shall have been married throughout the one (1)
year period ending on the date of the Participant's death.

     2.64 "Top-Heavy Group" shall mean an Aggregation Group in which, as of the
Determination Date, the sum of:

          (a) the Present Value of Accrued Retirement Income of Key Employees
     under all defined benefit plans included in that group, and

          (b) the Aggregate Accounts of Key Employees under all defined
     contribution plans included in the group, exceeds 60% of a similar sum
     determined for all employees.

     2.65 "Trust" or "Trust Fund" shall mean the trust established pursuant to
the Trust Agreement.

     2.66 "Trust Agreement" shall mean the trust agreement between the Company
and the Trustee, as described in Article XIV.

     2.67 "Trustee" shall mean the person or corporation designated as trustee
under the Trust Agreement, including any successor or successors.

     2.68 "Valuation Date" shall mean each business day of the New York Stock
Exchange.

     2.69 "Voluntary Participant Contribution" shall mean a contribution made
pursuant to Section 4.6 during the Plan Year.

     2.70 "Year of Service" shall mean a twelve-month period of employment as an
Employee, including any fractions thereof. Calculation of the twelve-month
periods shall commence with the Employee's first day of employment, which is the
date on which an Employee first performs an Hour of Service, and shall terminate
on his Break-in-Service Date. Thereafter, if he has more than one period of
employment as an Employee, his Years of Service for any subsequent period shall

                                       10
<PAGE>

commence with the Employee's reemployment date, which is the first date
following a Break-in-Service Date on which the Employee performs an Hour of
Service, and shall terminate on his next Break-in-Service Date. An Employee who
has a Break-in-Service Date and resumes employment with the Affiliated Employers
within twelve months of his Break-in-Service Date shall receive a fractional
Year of Service for the period of such cessation of employment.

     Notwithstanding anything in this Section 2.70 to the contrary, an Employee
shall not receive credit for more than one Year of Service with respect to any
twelve-consecutive-month period.

                                       11
<PAGE>

                                  ARTICLE III

                                  PARTICIPATION

     3.1 Eligibility Requirements. Each Eligible Employee who was an active
Participant on December 19, 2006 shall continue to be an active Participant in
the Plan on December 20, 2006, provided he remains an Eligible Employee. Each
other Eligible Employee may elect to participate in the Plan as of any
Enrollment Date after the Employee's first day of employment as an Eligible
Employee or as soon as administratively practicable thereafter. An Eligible
Employee shall make an election to participate by authorizing deductions from or
reduction of his Compensation as contributions to the Plan in accordance with
Article IV, and directing the investment of such contributions in accordance
with Article VIII. Such Compensation deduction and/or reduction authorization
and investment direction shall be made in accordance with the procedures
established by the Administrative Committee.

     3.2 Participation upon Reemployment. If an Employee terminates his
employment with an Affiliated Employer and is subsequently reemployed as an
Eligible Employee, he may elect to become an active Participant in the Plan as
of the date of his reemployment or as soon as administratively practicable
thereafter.

     3.3 No Restoration of Previously Distributed Benefits. A Participant who
has terminated his employment with the Affiliated Employers and who has received
a distribution of the amount credited to his Account pursuant to Section 12.5
shall not be entitled to restore the amount of such distribution to his Account
if he is reemployed and again becomes a Participant in the Plan.

     A Participant whose benefit under the Plan was transferred to a qualified
plan maintained by Mirant Services, LLC as a result of the spin-off of Mirant
from the Southern Company controlled group on April 2, 2001 shall not be
entitled to restoration of the amount of such transfer upon his subsequent
reemployment by an Affiliated Employer.

     Notwithstanding the foregoing, a Participant who terminated employment at a
time when he was zero percent (0%) vested in his account under the Performance
Sharing Plan and was deemed cashed-out of the Performance Sharing Plan, and who
returns to the employ of an Affiliated Employer before incurring five (5)
consecutive One-Year Breaks in Service shall be deemed to have bought back into
this Plan and shall be entitled to a restoration of his benefits attributable to
amounts under the Performance Sharing Plan, unadjusted for any subsequent gains
or losses.

     3.4 Loss of Eligible Employee Status. If a Participant loses his status as
an Eligible Employee, but remains an Employee, such Participant shall be
ineligible to participate and shall be deemed to have elected to suspend making
Voluntary Participant Contributions or to have Elective Employer Contributions
made on his behalf.

                                       12
<PAGE>

     3.5 Military Leave. Notwithstanding any provision of the Plan to the
contrary, contributions, benefits, and service credit with respect to qualified
military service will be provided in accordance with Section 414(u) of the Code.
Loan repayments may be suspended under the Plan as permitted under Section
414(u)(4) of the Code.

                                       13
<PAGE>

                                   ARTICLE IV

                       ELECTIVE EMPLOYER CONTRIBUTIONS AND

                       VOLUNTARY PARTICIPANT CONTRIBUTIONS

     4.1 Elective Employer Contributions. Subject to the combined limitation on
Elective Employer Contributions and Voluntary Participant Contributions under
Section 4.6, an Eligible Employee who meets the participation requirements of
Article III may elect in accordance with the procedures established by the
Administrative Committee to have his Compensation reduced by a whole percentage
of his Compensation, which percentage shall not be less than one percent (1%)
nor more than twenty-five percent (25%) of his Compensation, except to the
extent permitted under Section 4.11 of the Plan and Code Section 414(v), such
Elective Employer Contribution to be contributed to his Account under the Plan.

     4.2 Maximum Amount of Elective Employer Contributions. Subject to Section
4.11, the maximum amount of Elective Employer Contributions that may be made on
behalf of a Participant during any Plan Year to this Plan or any other qualified
plan maintained by an Employing Company shall not exceed the dollar limitation
set forth in Section 402(g) of the Code in effect at the beginning of such Plan
Year.

     4.3 Distribution of Excess Deferral Amounts

     (a) In General. Notwithstanding any other provision of the Plan, Excess
Deferral Amounts and income allocable thereto shall be distributed (and any
corresponding Employer Matching Contributions shall be forfeited) no later than
April 15, 2007, and each April 15 thereafter, to Participants who allocate (or
are deemed to allocate) such amounts to this Plan pursuant to (b) below for the
preceding calendar year. Excess Deferral Amounts that are distributed shall not
be treated as an Annual Addition. Any Employer Matching Contributions forfeited
pursuant to this subsection (a) shall be applied, subject to Section 6.1, toward
funding Employing Company contributions (for the Plan Year immediately following
the Plan Year to which such forfeited Employer Matching Contributions relate) or
distributed, as directed by the Administrative Committee, to the extent
permitted by applicable law.

     (b) Assignment. The Participant's allocation of amounts in excess of the
Code Section 402(g) limits to this Plan shall be in writing; shall be submitted
to the Administrative Committee no later than March 1; shall specify the
Participant's Excess Deferral Amount for the preceding calendar year; and shall
be accompanied by the Participant's written statement that if such amounts are
not distributed, such Excess Deferral Amount, when added to amounts deferred
under other plans or arrangements described in Section 401(k), 408(k), 408(p),
402(h)(1)(B), 457, 501(c)(18), or 403(b) of the Code, exceeds the limit imposed
on the Participant by Section 402(g) of the Code for the year in which the
deferral occurred. A Participant is deemed to notify the Administrative
Committee of any Excess Deferral

                                       14
<PAGE>

Amounts that arise by taking into account only those deferrals under this
Plan and any other plans of an Affiliated Employer.

     (c) Determination of Income or Loss. The Excess Deferral Amount distributed
to a Participant with respect to a calendar year shall be adjusted for income or
loss through the last day of the Plan Year or the date of distribution, as
determined by the Administrative Committee. The income or loss allocable to
Excess Deferral Amounts is the sum of:

          (1) income or loss allocated to the Participant's Account for the
     taxable year multiplied by a fraction, the numerator of which is such
     Participant's Excess Deferral Amount for the year and the denominator is
     the Participant's Account balance attributable to Elective Employer
     Contributions, minus any income or plus any loss occurring during the Plan
     Year; and

          (2) if the Administrative Committee shall determine in its sole
     discretion, ten percent (10%) of the amount determined under (1) above
     multiplied by the number of whole calendar months between the end of the
     Plan Year and the date of the distribution, counting the month of
     distribution if distribution occurs after the 15th of the month.

     Notwithstanding the above, the Administrative Committee may designate any
reasonable method for computing the income or loss allocable to Excess Deferral
Amounts, provided that the method does not violate Section 401(a)(4) of the
Code, is used consistently for all Participants and for all corrective
distributions under the Plan for the Plan Year, and is used by the Plan for
allocating income or loss to Participants' Accounts.

     (d) Maximum Distribution Amount. The Excess Deferral Amount, which would
otherwise be distributed to the Participant, shall, if there is a loss allocable
to such Excess Deferral Amount, in no event be less than the lesser of the
Participant's Account under the Plan attributable to Elective Employer
Contributions or the Participant's Elective Employer Contributions for the Plan
Year.

     4.4 Additional Rules Regarding Elective Employer Contributions.

     Salary reduction agreements shall be governed by the following:

     (a) A salary reduction agreement shall apply to payroll periods during
which such salary reduction agreement is in effect. The Administrative
Committee, in its discretion, may establish administrative procedures whereby
the actual reduction in Compensation may be made to coincide with each payroll
period of the Employing Company, or at such other times as the Administrative
Committee may determine.

     (b) The Employing Company may amend or revoke its salary reduction
agreement with any Participant at any time, if the Employing Company determines
that such revocation or amendment is necessary to ensure that a Participant's

                                       15
<PAGE>

additions for any Plan Year will not exceed the limitations of Sections 4.2 and
6.1 of the Plan or to ensure that the Actual Deferral Percentage Test is
satisfied.

     (c) Except as required under (b) above, and under Section 4.5(b) below, no
amounts attributable to Elective Employer Contributions may be distributed to a
Participant or his Beneficiary from his Account prior to the earlier of:

          (1) the severance from employment, death or disability of the
     Participant;

          (2) the attainment of age 59 1/2 by the Participant;

          (3) the termination of the Plan without establishment of a successor
     plan; or

          (4) a financial hardship of the Participant pursuant to Section 11.6
     of the Plan.

     4.5 Section 401(k) Nondiscrimination Tests.

     (a) Actual Deferral Percentage Test. The Plan shall satisfy the
nondiscrimination test of Section 401(k)(3) of the Code, under which no Elective
Employer Contributions shall be made that would cause the Actual Deferral
Percentage for Eligible Participants who are Highly Compensated Employees to
exceed the following:

          (1) The Average Actual Deferral Percentage for the Eligible
     Participants who are Highly Compensated Employees in the current Plan Year
     shall not exceed the Average Actual Deferral Percentage for the prior Plan
     Year for Eligible Participants who were Non Highly Compensated Employees
     for the prior Plan Year multiplied by 1.25; or

          (2) The Average Actual Deferral Percentage for Eligible Participants
     who are Highly Compensated Employees in the current Plan Year shall not
     exceed the Average Actual Deferral Percentage for Eligible Participants who
     were Non Highly Compensated Employees in the prior Plan Year multiplied by
     two (2), provided that the Average Actual Deferral Percentage for Eligible
     Participants who are Highly Compensated Employees in the current Plan Year
     does not exceed the Average Actual Deferral Percentage for the prior Plan
     Year for Eligible Participants who were Non Highly Compensated Employees in
     the prior Plan Year by more than two (2) percentage points.

     (b) Distribution of Excess Deferral Contributions.

          (1) In General. The Excess Deferral Contributions for a Highly
     Compensated Employee for a Plan Year which are to be distributed shall be

                                       16
<PAGE>

     distributed such that the Highly Compensated Employee with the highest
     amount of Elective Employer Contributions for the Plan Year shall be
     reduced to the extent required to:

               (A) distribute the total amount of Excess Deferral Contributions,
          or

               (B) cause the amount of such Highly Compensated Employee's
          Elective Employer Contributions to equal the amount of Elective
          Employer Contributions of the Highly Compensated Employee with the
          next highest amount of Elective Employer Contributions for the Plan
          Year.

          This process must be repeated until all Excess Deferral Contributions
     are distributed.

          Excess Deferral Contributions plus any income and minus any loss
     allocable thereto shall be distributed (and any corresponding Employer
     Matching Contribution shall be forfeited) to Participants on whose behalf
     such Excess Deferral Contributions were made within two and one-half
     (2-1/2) months after the last day of the Plan Year in which such excess
     amounts arose, and in any event not later than the last day of the Plan
     Year following the close of the Plan Year for which such contributions were
     made. Distribution of Excess Deferral Contributions shall be made to Highly
     Compensated Employees in accordance with this Section 4.5(b). Any Employer
     Matching Contributions forfeited pursuant to this Subsection (b)(1) shall
     be applied, subject to Section 6.1, toward funding Employing Company
     contributions (for the Plan Year immediately following the Plan Year to
     which such forfeited Employer Matching Contributions relate) or
     distributed, as directed by the Administrative Committee, to the extent
     permitted by applicable law.

          (2) Determination of Income or Loss. Excess Deferral Contributions to
     be distributed shall be adjusted for any income or loss through the date of
     distribution (or, for Plan Years beginning on or after January 1, 2008,
     through the end of the current Plan Year). The income or loss allocable to
     such Excess Deferral Contributions is the sum of:

               (A) income or loss allocated to the Participant's Account for the
          taxable year multiplied by a fraction, the numerator of which is the
          Participant's Excess Deferral Contributions to be distributed for the
          year and the denominator is the Participant's Account balance
          attributable to Elective Employer Contributions, minus any income or
          plus any loss occurring during the Plan Year; and

               (B) if the Administrative Committee shall determine in its sole
          discretion, ten percent (10%) of the amount determined under (A) above
          multiplied by the number of whole calendar months between the end of

                                       17
<PAGE>

          the Plan Year and the date of the distribution, counting the month of
          distribution if distribution occurs after the 15th of the month.

          Notwithstanding the above, the Administrative Committee may designate
     any reasonable method for computing the income or loss allocable to Excess
     Deferral Contributions, provided that the method does not violate Section
     401(a)(4) of the Code, is used consistently for all Participants and for
     all corrective distributions under the Plan for the Plan Year, and is used
     by the Plan for allocating income or loss to Participants' Accounts. The
     Plan will not fail to use a reasonable method for computing the income and
     loss allocable to Excess Deferral Contributions merely because the income
     and loss allocable to Excess Deferral Contributions is determined on a date
     that is no more than seven (7) days before the distribution.

          (3) Maximum Distribution Amount. The Excess Deferral Contributions
     which would otherwise be distributed to the Participant shall be adjusted
     for income; shall be reduced, in accordance with regulations, by the Excess
     Deferral Amount distributed to the Participant; and shall, if there is a
     loss allocable to the Excess Deferral Contributions, in no event be less
     than the lesser of the Participant's Account under the Plan attributable to
     Elective Employer Contributions or the Participant's Elective Employer
     Contributions for the Plan Year.

     (c) Special Rules.

          (1) For purposes of this Section 4.5, the Actual Deferral Percentage
     for any Eligible Participant who is a Highly Compensated Employee for the
     Plan Year and who is eligible to have deferral contributions allocated to
     his account under two (2) or more plans or arrangements described in
     Section 401(k) of the Code that are maintained by an Affiliated Employer
     shall be determined as if all such deferral contributions were made under a
     single arrangement. If a Highly Compensated Employee participates in two
     (2) or more cash or deferred arrangements that have different plan years,
     all cash or deferred contributions made under such arrangements with or
     within the same calendar year shall be treated as a single arrangement.
     Notwithstanding the foregoing, certain plans shall be treated as separate
     if mandatorily disaggregated under Code Section 401(k). For purposes of the
     Actual Deferral Percentage Test under this Section 4.5, the Company Stock
     Fund shall not be treated as a separate arrangement.

          (2) In the event that this Plan satisfies the requirements of Code
     Section 401(k), 401(a)(4), or 410(b) only if aggregated with one or more
     other plans, or if one or more other plans satisfy the requirements of Code
     Section 401(k), 401(a)(4), or 410(b) only if aggregated with this Plan,
     then the actual deferral percentages shall be determined as if all such
     plans were a single plan.

                                       18
<PAGE>

     4.6 Voluntary Participant Contributions. An Eligible Employee who meets the
participation requirements of Article III may elect in accordance with the
procedures established by the Administrative Committee to contribute to his
Account a Voluntary Participant Contribution consisting of any whole percentage
of his Compensation, which percentage is not less than one percent (1%) nor more
than twenty-five percent (25%) of his Compensation. The maximum Voluntary
Participant Contribution shall be reduced by the percent, if any, which is
contributed as an Elective Employer Contribution on behalf of such Participant
under Section 4.1.

     4.7 Manner and Time of Payment of Elective Employer Contributions and
Voluntary Participant Contributions. Contributions made in accordance with
Sections 4.1 and 4.6 will be made only through payroll deductions and will be
effective as of the payroll period commencing as soon as practicable after the
date on which the Participant elects to commence participation in the Plan.
Contributions shall be remitted to the Trustee as of the earliest date on which
such contributions can reasonably be segregated from each Employing Company's
general assets, but in any event not later than the fifteenth (15th) business
day of the month following the month during which such amounts would otherwise
have been payable to the Participant in cash or such earlier time as may be
prescribed by applicable law.

     4.8 Change in Contribution Rate. A Participant may prospectively change the
percentage of his Compensation that he has authorized as the Elective Employer
Contribution to be made on his behalf or his Voluntary Participant Contribution
to another permissible percentage in accordance with the procedures established
by the Administrative Committee. Such election shall be effective as soon as
practicable after it is made.

     4.9 Change in Contribution Amount. In the event of a change in the
Compensation of a Participant, the percentage of the Elective Employer
Contribution made on his behalf or his Voluntary Participant Contribution
currently in effect shall be applied as soon as practicable with respect to such
changed Compensation without action by the Participant.

     4.10 Rollovers from Other Plans. An Eligible Employee who is hired or
rehired and has received a distribution of his interest in a retirement plan of
a former employer, or a distribution of the interest of his deceased spouse in a
retirement plan of his spouse's former employer, under circumstances meeting the
requirements of Section 402(c)(4) of the Code relating to eligible rollover
distributions from qualified plans, including plans established under Code
Section 403(b) or 457(b), may elect to deposit all or any portion (as designated
by such Eligible Employee) of the amount of such distribution as a Rollover
Contribution to this Plan. A Rollover Contribution may be made only within 60
days following the date the Eligible Employee receives the distribution from the
plan of his former employer (or within such additional period as may be provided
under Section 408 of the Code if the Eligible Employee shall have made a timely
deposit of the distribution in an individual retirement account) and within 18
months after the date of his employment or reemployment with an Employing
Company. However, the 18-month requirement shall not apply with respect to
Rollover Contributions attributable to the distribution of the interest of an
Eligible Employee's deceased spouse in a retirement plan of the spouse's former
employer.

                                       19
<PAGE>

     The Administrative Committee shall establish rules and procedures to
implement this Section 4.10, including without limitation, such procedures as
may be appropriate to permit the Administrative Committee to verify the tax
qualified status of the plan of the former employer and compliance with any
applicable provisions of the Code relating to such contributions. The amount
contributed to the Trustee pursuant to this Section 4.10 shall be placed in the
Eligible Employee's Rollover Contribution subaccount for the benefit of the
Eligible Employee pursuant to Section 9.1. The Eligible Employee shall have a
fully vested interest in the balance of his Rollover Contribution subaccount at
all times and such Rollover Contribution subaccount shall share in the earnings,
gains, and losses of the Trust Fund as set forth in Article IX of the Plan. An
Employee shall be entitled to a distribution of his Rollover Contribution
subaccount pursuant to the applicable provisions of Article XI and Article XII
hereof.

     4.11 Catch-Up Contributions. All Eligible Participants who will have
attained age fifty (50) before the close of the Plan Year shall be eligible to
make catch-up contributions in accordance with, and subject to the limitations
of, Code Section 414(v). Such catch-up contributions shall not be taken into
account for purposes of the provisions of the Plan implementing the required
limitations of Code Sections 402(g) and 415. The Plan shall not be treated as
failing to satisfy the provisions of the Plan implementing the requirements of
Code Section 401(k)(3), 401(k)(11), 401(k)(12), 410(b), or 416, as applicable,
by reason of making of such catch-up contributions. Catch-up contributions shall
be made in such dollar amounts as elected by the Participant in accordance with
the procedures established by the Administrative Committee.

                                       20
<PAGE>

                                   ARTICLE V

                         EMPLOYER MATCHING CONTRIBUTIONS

     5.1 Amount of Employer Matching Contributions. The Board of Directors, in
its sole and absolute discretion, shall determine the amount of Employer
Matching Contributions that shall be made by each Employing Company on behalf of
each Participant in its employ. The amount of Employer Matching Contributions
shall be fixed by resolutions of the Board of Directors and communicated to each
Employing Company prior to the first day of each Plan Year.

     5.2 Payment of Employer Matching Contributions. Except as provided herein,
Employer Matching Contributions shall be remitted to the Trustee as soon as
practicable after the payroll period to which they relate.

     5.3 Limitations on Employer Matching Contributions and Voluntary
Participant Contributions.

          (a) Actual Contribution Percentage Test. The Plan shall satisfy the
     nondiscrimination test of Section 401(m) of the Code, under which the
     Average Contribution Percentage for Eligible Participants shall not exceed
     (1) or (2) as follows:

               (1) The Average Contribution Percentage for Eligible Participants
          who are Highly Compensated Employees in the current Plan Year shall
          not exceed the Average Contribution Percentage for the prior Plan Year
          for Eligible Participants who were Non Highly Compensated Employees in
          the prior Plan Year multiplied by 1.25; or

               (2) The Average Contribution Percentage for Eligible Participants
          who are Highly Compensated Employees in the current Plan Year shall
          not exceed the Average Contribution Percentage for Eligible
          Participants who were Non Highly Compensated Employees in the prior
          Plan Year multiplied by two (2), provided that the Average
          Contribution Percentage for Eligible Participants who are Highly
          Compensated Employees in the current Plan Year does not exceed the
          Average Contribution Percentage for the prior Plan Year for Eligible
          Participants who were Non Highly Compensated Employees in the prior
          Plan Year by more than two (2) percentage points.

          (b) Distribution of Excess Aggregate Contributions.

               (1) In General. The Excess Aggregate Contributions for a Highly
          Compensated Employee for a Plan Year which are to be distributed shall
          be distributed such that the Highly Compensated Employee with the

                                       21
<PAGE>

          highest amount of Matching Employer Contributions and Voluntary
          Participant Contributions shall be reduced to the extent required to:

                    (A) distribute the total amount of Excess Aggregate
               Contributions, or

                    (B) cause the amount of such Highly Compensated Employee's
               Employer Matching Contributions and Voluntary Participant
               Contributions to equal the amount of Employer Matching
               Contributions and Voluntary Participant Contributions of the
               Highly Compensated Employee with the next highest amount of
               Employer Matching Contributions and Voluntary Participant
               Contributions for the Plan Year.

               This process must be repeated until all Excess Aggregate
          Contributions are distributed.

               Excess Aggregate Contributions, plus any income and minus any
          loss allocable thereto, shall be distributed (or, if forfeitable,
          forfeited) within 2 1/2 months after the last day of the Plan Year in
          which such excess amounts arose, and in any event not later than the
          last day of the following Plan Year, to Participants to whose Accounts
          such Excess Aggregate Contributions were allocated for the Plan Year.
          Excess Aggregate Contributions shall be treated as Annual Additions.

               (2) Determination of Income or Loss. Excess Aggregate
          Contributions to be distributed shall be adjusted for any income or
          loss through the date of distribution (or, for Plan Years beginning on
          or after January 1, 2008, through the end of the current Plan Year).
          The income or loss allocable to such Excess Aggregate Contributions is
          the sum of:

                    (A) income or loss allocated to the Participant's Account
               attributable to Voluntary Participant Contributions and Employer
               Matching Contributions to be distributed for the Plan Year
               multiplied by a fraction, the numerator of which is the
               Participant's Excess Aggregate Contributions for the year and the
               denominator is the Participant's Account balance attributable to
               Voluntary Participant Contributions and Employer Matching
               Contributions, minus any income or plus any loss occurring during
               the Plan Year; and

                    (B) if the Administrative Committee shall determine in its
               sole discretion, ten percent (10%) of the amount determined under
               (1) above multiplied by the number of whole calendar months
               between the end of the Plan Year and the date of the
               distribution, counting the month of distribution if distribution
               occurs after the 15th of the month.

                                       22
<PAGE>

               Notwithstanding the above, the Administrative Committee may
          designate any reasonable method for computing the income or loss
          allocable to Excess Aggregate Contributions, provided that the method
          does not violate Section 401(a)(4) of the Code, is used consistently
          for all Participants and for all corrective distributions under the
          Plan for the Plan Year, and is used by the Plan for allocating income
          or loss to Participants' Accounts. The Plan will not fail to use a
          reasonable method for computing the income and loss allocable to
          Excess Aggregate Contributions merely because the income and loss
          allocable to Excess Aggregate Contributions is determined on a date
          that is no more than seven (7) days before the distribution.

               (3) Accounting for Excess Aggregate Contributions. Excess
          Aggregate Contributions shall be distributed first from Voluntary
          Participant Contributions allocated to the Participant's Account and
          any corresponding Employer Matching Contribution shall also be
          forfeited and then, if necessary, distributed from the remaining
          Employer Matching Contribution allocated to the Participant's Account.

     (c) Special Rules.

               (1) The Contribution Percentage for any Eligible Participant who
          is a Highly Compensated Employee for the Plan Year and who is eligible
          to make voluntary participant contributions, to receive employer
          matching contributions, or to make deferral contributions under two or
          more plans described in Section 401(a) of the Code or arrangements
          described in Section 401(k) of the Code that are maintained by an
          Affiliated Employer shall be determined as if all such contributions
          were made under a single plan.

               (2) In the event that this Plan satisfies the requirements of
          Code Section 401(m), 401(a)(4), or 410(b) only if aggregated with one
          or more other plans, or if one or more other plans satisfy the
          requirements of Code Section 401(m), 401(a)(4), or 410(b) only if
          aggregated with this Plan, then the contribution percentages shall be
          determined as if all such plans were a single plan.

               (3) The determination and treatment of the Contribution
          Percentage of any Eligible Participant shall satisfy such other
          requirements as may be prescribed by the Secretary of the Treasury.

     5.4 Reversion of Employing Company Contributions. Employing Company
contributions computed in accordance with the provisions of this Plan shall
revert to the Employing Company under the following circumstances:

          (a) In the case of an Employing Company contribution which is made by
     reason of a mistake of fact, such contribution upon written direction of
     the Employing Company shall be returned to the Employing Company within one
     year after the payment of the contribution.

                                       23
<PAGE>

          (b) If any Employing Company contribution is determined to be
     nondeductible under Section 404 of the Code, then such Employing Company
     contribution, to the extent that it is determined to be nondeductible, upon
     written direction of the Employing Company shall be returned to the
     Employing Company within one year after the disallowance of the deduction.

     The amount which may be returned to the Employing Company under this
Section 5.4 is the excess of (1) the amount contributed over (2) the amount that
would have been contributed had there not occurred a mistake of fact or
disallowance of the deduction. Earnings attributable to the excess contribution
shall not be returned to the Employing Company, but losses attributable thereto
shall reduce the amount to be so returned. If the withdrawal of the amount
attributable to the mistaken contribution would cause the balance of the Account
of any Participant to be reduced to less than the balance which would have been
in the Account had the mistaken amount not been contributed, then the amount to
be returned to the Employing Company shall be limited so as to avoid such
reduction.

     5.5 Correction of Prior Incorrect Allocations and Distributions.
Notwithstanding any provisions contained herein to the contrary, in the event
that, as of any Valuation Date, adjustments are required in any Participants'
Accounts to correct any incorrect allocation of contributions or investment
earnings or losses, or such other discrepancies in Account balances that may
have occurred previously, the Employing Companies may make additional
contributions to the Plan to be applied to correct such incorrect allocations or
discrepancies. The additional contributions shall be allocated by the
Administrative Committee to adjust such Participants' Accounts to the value
which would have existed on said Valuation Date had there been no prior
incorrect allocation or discrepancies. The Administrative Committee shall also
be authorized to take such other actions as it deems necessary to correct prior
incorrect allocations or discrepancies in the Accounts of Participants under the
Plan.

                                       24
<PAGE>

                                   ARTICLE VI

                          LIMITATIONS ON CONTRIBUTIONS

     6.1 Section 415 Limitations. Notwithstanding any provision of the Plan to
the contrary, except to the extent permitted under Code Section 414(v), the
total Annual Additions allocated to the Account (and the accounts under all
defined contribution plans maintained by an Affiliated Employer) of any
Participant for any Limitation Year in accordance with Code Section 415 and the
regulations thereunder, which are incorporated herein by this reference, shall
not exceed the lesser of the following amounts:

          (a) one hundred percent (100%) of the Participant's compensation (as
     defined in Code Section 415(c)(3) and any rulings and regulations
     thereunder) in the Limitation Year; or

          (b) $40,000 (as adjusted pursuant to Code Section 415(d)(1)(C)).

     6.2 Correction of Contributions in Excess of Section 415 Limits. If the
Annual Additions for a Participant exceed the limits of Section 6.1 as a result
of the allocation of forfeitures, if any, a reasonable error in estimating a
Participant's annual compensation for purposes of the Plan, a reasonable error
in determining the amount of elective deferrals (within the meaning of Section
402(g)(3) of the Code) that may be made with respect to any individual, or under
other limited facts and circumstances that the Commissioner of the Treasury
finds justify the availability of the rules set forth in this Section 6.2, the
excess amounts shall not be deemed Annual Additions if they are treated in
accordance with any one or more or any combination of the following:

          (a) distribute to the Participant that portion, or all, of his
     Elective Employer Contributions (as adjusted for income and loss) as is
     necessary to ensure compliance with Section 6.1;

          (b) return to the Participant that portion, or all, of his Voluntary
     Participant Contributions (as adjusted for income and loss) as is necessary
     to ensure compliance with Section 6.1; and

          (c) forfeiture of that portion, or all, of the Employer Matching
     Contributions (as adjusted for income and loss) and any forfeitures of
     Employer contributions that were allocated to the Participant's Account (as
     adjusted for income and loss), as is necessary to ensure compliance with
     Section 6.1.

     Any amounts distributed or returned to the Participant under (a) or (b)
above shall be disregarded for purposes of the Actual Deferral Percentage Test
and for purposes of the Actual Contribution Percentage Test.

                                       25
<PAGE>

     Any amounts forfeited under this Section 6.2 shall be held in a suspense
account and shall be applied, subject to Section 6.1, toward funding the
Employer Matching Contributions for the next succeeding Plan Year. Such
application shall be made prior to any Employing Company contributions and prior
to any Employer Matching Contributions that would constitute Annual Additions.
No income or investment gains and losses shall be allocated to the suspense
account provided for under this Section 6.2. If any amount remains in a suspense
account provided for under this Section 6.2 upon termination of this Plan, such
amount will revert to the Employing Companies notwithstanding any other
provision of this Plan.

     6.3 Combination of Plans. If an Employee participates in more than one
defined contribution plan maintained by an Affiliated Employer and his Annual
Additions exceed the limitations of Section 6.1, corrective adjustments shall be
made first under this Plan and then, to the extent necessary, under such other
defined contribution plan.

                                       26
<PAGE>

                                  ARTICLE VII

                           SUSPENSION OF CONTRIBUTIONS

     7.1 Suspension of Contributions. A Participant may (on a prospective basis)
voluntarily suspend the Elective Employer Contributions made on his behalf and
his Voluntary Participant Contributions in accordance with the procedures
established by the Administrative Committee. Such suspension shall be effective
as soon as practicable after it is made. Whenever Elective Employer
Contributions made on a Participant's behalf and Voluntary Participant
Contributions are suspended, Employer Matching Contributions shall also be
suspended.

     7.2 Resumption of Contributions. A Participant may terminate prospectively
a suspension described in Section 7.1 in accordance with the procedures
established by the Administrative Committee. Such resumption of contributions
shall be effective as soon as practicable after the election to terminate
prospectively the suspension is made. There shall be no make up of any
contributions by a Participant or by an Employing Company with respect to a
period of suspension.

                                       27
<PAGE>

                                  ARTICLE VIII

                           INVESTMENT OF CONTRIBUTIONS

     8.1 Investment Funds. Except for the Company Stock Fund, which shall be and
remain an Investment Fund as a matter of Plan design and without any action by
the Pension Fund Investment Review Committee, the Pension Fund Investment Review
Committee may from time to time select or terminate other Investment Funds. The
Company Stock Fund shall be exclusively invested and, subject to Section 12.13
of the Plan, reinvested in Common Stock, provided that funds applicable to the
purchase of Common Stock pending investment of such funds may be temporarily
invested in short-term United States Government obligations, other obligations
guaranteed by the United States Government, commercial paper, or certificates of
deposit, and, if the Trustee so determines, may be transferred to money market
funds utilized by the Trustee for qualified employee benefit trusts.

     8.2 Investment of Contributions. Each Participant shall direct, at the time
he elects to participate in the Plan and at such other times as may be directed
by the Administrative Committee or pursuant to Section 8.5, that his Account be
invested in one or more of the Investment Funds, provided such investments are
made in one-percent (1%) increments. Employer Matching Contributions made on or
after November 1, 2006, shall be invested solely in accordance with a
Participant's investment direction. With respect to any investment direction in
effect on November 1, 2006 for Elective Employer Contributions and Voluntary
Participant Contributions, such investment direction shall also apply to
Employer Matching Contributions until the Participant makes a different
investment direction. A Participant may change his investment direction pursuant
to Section 8.5.

     8.3 Investment of Earnings. Except as provided in Section 12.13, interest,
dividends, if any, and other distributions received by the Trustee with respect
to an Investment Fund shall be invested in such Investment Fund.

     8.4 Transfer of Assets between Funds. A Participant may direct in
accordance with the provisions of this Section 8.4 and such procedures
established by the Administrative Committee that all of his interest in an
Investment Fund or Funds attributable to amounts in his Account or any portion
of such amount (expressed in number of shares, whole dollar amounts, or
one-percent (1%) increments) to the credit of his Account be transferred and
invested by the Trustee as of such date in any other Investment Fund as
designated by the Participant. Such direction shall be effective as soon as
practicable after it is made.

     8.5 Change in Investment Direction. Any investment direction given by a
Participant shall continue in effect until changed by the Participant. A
Participant may change his investment direction as to the future contributions
and allocations to his Account in accordance with the procedures established by
the Administrative Committee, and such direction shall be effective as soon as
practicable after it is made.

                                       28
<PAGE>

     8.6 Section 404(c) Plan. This Plan is intended to be a plan described in
ERISA Section 404(c) and shall be interpreted in accordance with Department of
Labor Regulations Section 1.404c-1, which is incorporated herein by this
reference. The Administrative Committee shall take such actions as it deems
necessary or appropriate in its discretion to cause the Plan to comply with such
requirements, including, but not limited to, providing Participants with the
right to request and receive written confirmation of their investment
instructions. Further, the Administrative Committee shall take such actions as
it deems necessary or appropriate in its discretion (a) to ensure that
confidentiality procedures with respect to a Participant's ownership of Common
Stock and the exercise of ownership rights with respect to such Common Stock are
adequate and utilized, and (b) to appoint an independent fiduciary to carry out
such actions as the Administrative Committee determines involve the potential
for undue influence on Participants with regard to the direct or indirect
exercise of shareholder rights with respect to Common Stock.

     8.7 Suspension, Discontinuance or Restriction of Trading. Notwithstanding
any provision of the Plan to the contrary, the Administrative Committee shall
take such actions as it deems necessary or appropriate to administer the Plan
during any period in which trading of one or more investments has been
suspended, discontinued, or otherwise restricted (for example, by ceasing to be
traded on a recognized exchange) by application of the securities laws or for
any other reason. Such action may include, but shall not be limited to: delaying
or restricting fund transfers of such investment; delaying, limiting the amount
of, or changing the source of loans, withdrawals or distributions under the
Plan; or excluding such investment for purposes of determining the availability
of loans or withdrawals. However, in no event shall the foregoing give the
Administrative Committee discretion or control over the investment of Plan
assets.

     8.8 Designated Net Litigation Distributions. All "Designated Net Litigation
Distributions" received by the Plan as described in Section 9.1(e) shall be
invested in accordance with a Participant's investment election under the
procedures of this Article VIII in effect at any time such Designated Net
Litigation Distributions are received by the Plan. Section 13.13 shall apply in
the event it is necessary to establish a new Account for a former Participant to
hold Designated Net Litigation Distributions received by the Plan attributable
to such former Participant and such former Participant has not made an
affirmative investment election under the procedures of this Article VIII.

                                       29
<PAGE>

                                   ARTICLE IX

               MAINTENANCE AND VALUATION OF PARTICIPANTS' ACCOUNTS

     9.1 Establishment of Accounts.

          (a) An Account shall be established for each Participant. In addition,
     subaccounts shall be established for each Participant to reflect all
     Elective Employer Contributions, Voluntary Participant Contributions,
     Employer Matching Contributions, Rollover Contributions, and rollover
     contributions from the SEPCO Plan (and the earnings and/or losses on each
     subaccount). Each Participant will be furnished a statement of his Account
     at least annually and upon any distribution.

          (b) The Administrative Committee shall also establish a subaccount
     known as a Participant's SEPCO Transferred Account to reflect the
     Participant's interest in the Plan resulting from the merger of the SEPCO
     Plan into this Plan effective as of January 1, 1993. To the extent that a
     Participant's Salary Deferral Account, Employer Contribution Account, and
     Rollover Account (as those terms were defined under the SEPCO Plan), were
     transferred to this Plan from the SEPCO Plan, such accounts shall retain
     their character as participant deferral, employer, or rollover
     contributions, respectively, and the Administrative Committee shall
     establish and maintain such bookkeeping accounts as it deems necessary to
     account for such contributions, and any subsequent earnings or losses
     attributable thereto, under this Plan.

          (c) Upon the merger of the Performance Sharing Plan into this Plan
     effective as of June 21, 2002, a Participant's interest in the Performance
     Sharing Plan which is transferred to this Plan shall be added to the
     Participant's Employer Matching Contributions subaccount and shall be
     treated as Employer Matching Contributions under the Plan. In the event a
     Participant for whom amounts were transferred from the Performance Sharing
     Plan did not have an Account under this Plan prior to such transfer, an
     Employer Matching Contributions subaccount shall be established for such
     Participant. Except as otherwise determined by the Administrative
     Committee, the investment elections in effect under the Performance Sharing
     Plan at the time amounts are transferred to this Plan shall continue to
     apply to such amounts under this Plan, and Participants may thereafter
     direct the investment of such amounts in accordance with Article VIII.

          (d) Upon the merger of the Employee Stock Ownership Plan into this
     Plan, a Participant's interest in the Employee Stock Ownership Plan which
     is transferred to this Plan shall be added to the Participant's Employer
     Matching Contributions subaccount and shall be treated as Employer Matching
     Contributions under the Plan. In the event a Participant for whom amounts
     were transferred from the Employee Stock Ownership Plan did not have an
     Account under this Plan prior to such transfer, an Employer Matching
     Contributions subaccount shall be established for such Participant. The
     portion of a Participant's Account attributable to amounts transferred from

                                       30
<PAGE>

     the Employee Stock Ownership Plan initially shall be invested in the
     Company Stock Fund. Participants may thereafter direct the investment of
     such amounts in accordance with Article VIII.

          (e) Pursuant to the terms of the Plan of Reorganization, certain
     equity holders in Mirant may share in Designated Net Litigation
     Distributions, as described in Section 10.13 of the Plan of Reorganization.
     The Administrative Committee shall establish recordkeeping accounts to
     reflect a Participant's interest in any Designated Net Litigation
     Distributions that may be received by the Plan. Upon receipt by the Plan of
     any Designated Net Litigation Distributions, the Administrative Committee
     shall establish a subaccount known as the "Mirant Litigation Distribution
     Account" to reflect the Participant's interest in the Designated Net
     Litigation Distributions. In the event Designated Net Litigation
     Distributions are received by the Plan with respect to any former
     Participant for whom an Account is no longer maintained, the Administrative
     Committee shall establish a new Account for such Participant which shall be
     comprised solely of his Mirant Litigation Distribution Account.

     9.2 Valuation of Investment Funds. Except as provided in Section 12.13 of
the Plan, a Participant's Account in respect of his interest in each Investment
Fund shall be credited or charged, as the case may be, as of each Valuation Date
with the dividends, income, gains, appreciation, losses, depreciation,
forfeitures, expenses, and other transactions with respect to such Investment
Fund for the Valuation Date as of which such credit or charge accrued. Such
credits or charges to a Participant's Account shall be made in such proportions
and by such method or formula as shall be deemed by the Administrative Committee
to be necessary or appropriate to account for each Participant's proportionate
beneficial interest in the Trust Fund in respect of his interest in each
Investment Fund. Investments of each Investment Fund shall be valued at their
fair market values as of each Valuation Date as determined by the Trustee, and
such valuation shall conclusively establish such value.

     9.3 Rights in Investment Funds. Nothing contained in this Article IX shall
be deemed to give any Participant any interest in any specific property in any
Investment Fund or any interest, other than the right to receive payments or
distributions in accordance with the Plan or the right to instruct the Trustee
how to vote Common Stock as provided in Section 14.3.

                                       31
<PAGE>

                                    ARTICLE X

                                     VESTING

     10.1 Vesting. The amount to the credit of a Participant's Account shall at
all times be fully vested and nonforfeitable.

                                       32
<PAGE>

                                   ARTICLE XI

                              WITHDRAWALS AND LOANS

     11.1 Withdrawals by Participants.

          (a) Subject to the provisions of Article XII, this Section 11.1, and
     Sections 11.2 through 11.6, a Participant may make withdrawals from his
     Account effective as of any Valuation Date in the order of priority listed
     below:

               (1) All or a portion of the value of his Account attributable to
          Voluntary Participant Contributions (not including any earnings or
          appreciation thereon) made prior to January 1, 1987;

               (2) All amounts described above, plus all or a portion of the
          value of his Account attributable to Voluntary Participant
          Contributions, plus a ratable portion of the earnings and/or
          appreciation on Voluntary Participant Contributions;

               (3) All amounts described above, plus effective April 1, 1997,
          all or a portion of the value of his Account attributable to Rollover
          Contributions (including earnings and appreciation thereon);

               (4) All amounts described above, plus all or a portion of the
          value of his Account attributable to his Employer Matching
          Contributions (including earnings and appreciation thereon) allocated
          to his Account; provided, however, that said Participant shall have
          participated in the Plan for not less than sixty (60) months at the
          time of the withdrawal;

               (5) (A) For Participants who have not attained age 59 1/2 or
          separated from service with the Affiliated Employers (within the
          meaning of Code Section 401(k)(2)(B)(i)(I)), all amounts described
          above, plus all or a portion of the value of his Account attributable
          to Elective Employer Contributions (not including any earnings or
          appreciation thereon for Plan Years beginning after December 31,
          1988); and

                   (B) For Participants who have attained age 59 1/2 or
          separated from service with the Affiliated Employers (within the
          meaning of Code Section 401(k)(2)(B)(i)(I)), all amounts described
          above, plus all ora portion of the value of his Account attributable
          to any earnings or appreciation on Elective Employer Contributions.

                                       33
<PAGE>

                  For purposes of applying Section 11.1(a)(4), any Participant
         who has an interest in his Employer Matching Contributions subaccount
         attributable to an amount transferred from the Employee Stock Ownership
         Plan shall be treated as first participating in this Plan as of the
         earlier of the date such individual began participating in the Employee
         Stock Ownership Plan or the date he began participating in this Plan.

                  (b) Notwithstanding the foregoing, withdrawals from a
         Participant's SEPCO Transferred Account shall be made in accordance
         with Article XVIII.

     11.2 Notice of Withdrawal. Notice of withdrawal must be given by a
Participant in accordance with the procedures established by the Administrative
Committee, and if such withdrawal would constitute an eligible rollover
distribution (within the meaning of Code Section 402(c)(4)), the consent and
notice requirements of Section 12.10 must be satisfied. Payment of a withdrawal
shall be made as soon as practicable and in accordance with Section 12.10, if
applicable.

     11.3 Form of Withdrawal. All distributions under this Article XI shall be
made in the form of cash, provided that with respect to any distribution which
is attributable to Common Stock, the Participant shall have the right to demand
that such portion of the distribution be made in the form of Common Stock to the
extent of the whole number of shares of Common Stock in his Account. Such demand
must be made in accordance with the procedures established by the Administrative
Committee.

     11.4 Minimum Withdrawal. No distribution under this Article XI shall be
permitted in an amount which has a value of less than $300, unless the value of
the amount available under the selected option is less than $300, in which case
such available amount will be distributed.

     11.5 Source of Withdrawal. Withdrawals shall be made in accordance with the
instructions of the Participant from each of the Investment Funds in which the
amount to be distributed is invested. The value of the amount to be distributed
under any option listed in Section 11.1 shall be determined as soon as
practicable in accordance with the procedures established by the Administrative
Committee.

     11.6 Requirement of Hardship.

          (a) Except as provided in (e) below, a withdrawal pursuant to Section
     11.1(5)(A), in addition to the other requirements of Article XI, shall be
     permitted only if the Administrative Committee determines that the
     withdrawal is to be made on account of an immediate and heavy financial
     need of the Participant, the amount of the withdrawal does not exceed such
     financial need, and the amount of the withdrawal is not reasonably
     available from other resources of the Participant.

          (b) For purposes of this Section 11.6, the following shall be deemed
     to be immediate and heavy financial needs:

               (1) Expenses for (or necessary to obtain) medical care that would
          be deductible under Section 213(d) of the Code (determined without
          regard to whether the expenses exceed 7.5% of adjusted gross income);

                                       34
<PAGE>

          including but not limited to, expenses for

                    (A) the diagnosis, cure, mitigation, treatment, or
               prevention of disease, or for the purpose of affecting any
               structure or function of the body; or

                    (B) transportation primarily for and essential to such
               expenses referred to in (i) above; or

                    (C) insurance (including amounts paid as premiums under part
               B of Title XVIII of the Social Security Act) relating to medical
               expenses referred to in (i) or (ii) above, provided such expenses
               are incurred by the Participant, the Participant's spouse or
               dependent (as defined in Section 152 of the Code without regard
               to subsections (b)(1), (b)(2) and (d)(1)(B) on or after January
               1, 2006), or are necessary for such persons to obtain the medical
               care described above; or

               (2) Purchase (excluding mortgage payments) of a principal
          residence for the Participant; or

               (3) Payment of tuition, related educational fees, and room and
          board expenses, for the next twelve (12) months of post-secondary
          education for the Participant, the Participant's spouse, child or
          children, or dependent (as defined in Section 152 of the Code without
          regard to subsections (b)(1), (b)(2) and (d)(1)(B)); or

               (4) The need to prevent eviction of the Participant from his
          principal residence or foreclosure on the mortgage of the
          Participant's principal residence; or

               (5) Payment of burial or funeral expenses for the Participant's
          deceased parent, spouse, child or dependent (as defined in Section 152
          of the Code without regard to subsection (d)(1)(B)); or

               (6) Payment of expenses for the repair of damage to the
          Participant's principal residence that would qualify for a casualty
          deduction under Section 165 of the Code (determined without regard to
          whether the loss exceeds 10% of adjusted gross income); or

               (7) Any other need which the Commissioner of the Internal Revenue
          Service, through the publication of revenue rulings, notices, or other
          documents of general applicability, deems to be immediate and heavy.

          (c) For purposes of this Section 11.6, a withdrawal shall be deemed
     necessary to satisfy an immediate and heavy financial need if:

                                       35
<PAGE>

               (1) The distribution is not in excess of the amount of the
          immediate and heavy financial need of the Participant, including any
          amounts necessary to pay any federal, state, or local income taxes or
          penalties reasonably anticipated to result from the distribution;

               (2) The Participant has obtained all distributions (including the
          distribution of Company Stock Fund dividends under Section 404(k) of
          the Code, if any, in accordance with Section 12.13) and all nontaxable
          loans currently available to him under all plans maintained by an
          Affiliated Employer;

               (3) The Participant has utilized all financial resources
          including assets belonging to the Participant's spouse and minor
          children that are reasonably available to the Participant; and

               (4) The Participant agrees to suspend all elective employer
          contributions and voluntary participant contributions to all plans of
          an Affiliated Employer for at least six (6) months after receipt of
          the distribution under this Section 11.6.

          (d) When all suspensions pursuant to this Section 11.6 are ended,
     Elective Employer Contributions and/or Voluntary Participant Contributions
     may be resumed by the Participant (if the Participant is then eligible and
     elects to resume such contributions) beginning with the Participant's first
     payroll period commencing after all suspensions are ended, and Employer
     Matching Contributions by his Employing Company also shall be resumed.
     There shall be no make up of any contributions by a Participant or by an
     Employing Company with respect to a period of suspension.

          (e) Notwithstanding (a) above, if a Participant has attained age 59
     1/2 or severed from employment with the Affiliated Employers (within the
     meaning of Code Section 401(k)(2)(B)(i)(I)), he shall be permitted to make
     a withdrawal pursuant to Section 11.1(5)(A), even if such withdrawal is not
     on account of hardship.

     11.7 Loans to Participants.

          (a) The Administrative Committee may, in its sole discretion, direct
     the Trustee to make a loan or loans from the Trust Fund to any Participant
     (other than a Participant with an existing Plan loan in arrears) (1) who is
     an Employee on the active payroll of an Employing Company, (2) who is
     receiving long-term disability payments under a plan maintained by his
     Employing Company, (3) who is on a leave of absence authorized by his
     Employing Company, or (4) who is a party in interest as defined in Section
     3(14) of ERISA. All loan applications shall be made in accordance with the
     procedures established by the Administrative Committee, which shall form a
     part of this Plan. Such procedures shall establish the terms and conditions
     of loans under the Plan, including the events constituting default, and
     shall be consistent with the provisions of this Section 11.7.

          (b) The total amount of all loans outstanding to any one Participant
     under all qualified plans maintained by an Affiliated Employer shall not
     exceed the lesser of (1) $50,000, reduced by the excess of the highest

                                       36
<PAGE>

     outstanding balance of loans from all qualified plans maintained by an
     Affiliated Employer during the twelve-month period ending on the day before
     a loan is made, over the outstanding balance of any loans to the
     Participant from all qualified plans maintained by an Affiliated Employer
     on the date the loan is made, or (2) fifty percent (50%) of such
     Participant's Account as of the Valuation Date coinciding with or next
     following the date the loan application is made. The minimum amount of any
     loan shall not equal less than $1,000.

          (c) The principal amount of a loan shall be obtained pro rata from
     each Investment Fund in which the Participant's Account is invested at that
     time such loan is obtained.

          (d) The Administrative Committee shall adopt and follow uniform and
     nondiscriminatory procedures in making loans under this Plan to make
     certain that such loans (1) are available to all Participants on a
     reasonably equivalent basis, (2) are not made available to Highly
     Compensated Employees, officers, or shareholders in an amount greater than
     the amount made available to other Participants, (3) bear a reasonable rate
     of interest, and (4) are adequately secured. The repayment of such loans by
     any Participant who is an Employee on the active payroll of an Employing
     Company shall be made through payroll deduction. The minimum amount of any
     loan repayment shall not equal less than $20.00, and such repayment shall
     extend for a period certain of at least twelve (12) months (unless repaid
     in full), but not to exceed fifty-eight (58) months, expressed in any
     number of whole months (including the month the loan is made). The term of
     any loan may be for a period certain of more than fifty-eight (58) months,
     but not to exceed fifteen (15) years, only if the proceeds of such loan are
     used to acquire any dwelling used or, within a reasonable period of time,
     to be used as the principal residence of the Participant.

          (e) The Administrative Committee shall direct the Trustee to obtain
     from the Participant such note and adequate security as it may require. All
     loans made pursuant to this Section 11.7 shall be secured by the
     Participant's Account, and no other types of collateral may be used to
     secure a loan from the Plan. Notwithstanding the provisions of Section
     17.2, if a Participant defaults on a loan under the Plan or if the
     Participant's employment terminates prior to full repayment thereof, in
     addition to any other remedy provided in the loan instruments or by law,
     the Administrative Committee may direct the Trustee to charge against that
     portion of the Participant's Account which secures the loan the amount
     required to fully repay the loan. Under no circumstances, however, shall
     any unpaid loan be charged against a Participant's Account until permitted
     by applicable law. This Section 11.7 authorizes only the making of bona
     fide loans and not distributions, and before resort is made against a
     Participant's Account for his failure to repay any loan, such other
     reasonable efforts to collect the same shall be made by the Administrative
     Committee as it deems reasonable and practical under the circumstances.

          (f) No distribution shall be made to any Participant unless and until
     all unpaid loans to such Participant have either been paid in full or
     deducted from the Participant's Account.

                                       37
<PAGE>

          (g) All loans made under this Section 11.7 shall be considered
     earmarked investments of the Participant's Account, and any repayment of
     principal and interest shall be reinvested in accordance with the
     Participant's investment direction in effect on the date of such repayment
     pursuant to Article VIII of the Plan.

     11.8 Special Waiver for Participants Employed in the United Kingdom. A
Participant shall be entitled to sign a waiver of his right to make withdrawals
or loans from his Account under the provisions of this Article XI with respect
to the Elective Employer Contributions and Employer Matching Contributions
credited to his Account to the extent necessary to ensure that such
contributions are not taxable in the United Kingdom. The purpose of such waiver
is to meet the requirements of the Department of Inland Treasury of the United
Kingdom for excluding such Elective Employer and Employer Matching Contributions
from taxable income in the United Kingdom. Such waiver shall be made on a form
prescribed by the Administrative Committee from time to time in accordance with
the requirements of the Department of Inland Treasury of the United Kingdom.

                                       38
<PAGE>

                                  ARTICLE XII

                          DISTRIBUTION TO PARTICIPANTS

     12.1 Distribution upon Retirement.

          (a) Subject to the provisions of Article XVIII, if a Participant's
     employment with the Affiliated Employers is terminated as a result of his
     retirement pursuant to the defined benefit pension plan of an Affiliated
     Employer, in addition to the withdrawal options under Section 11.1, the
     entire balance credited to his Account shall be payable to him in the
     manner set forth in this Section 12.1 at such time requested by the
     Participant pursuant to Section 12.6 and in accordance with the procedures
     established by the Administrative Committee. The distribution shall
     commence as soon as practicable after the Valuation Date selected by the
     Participant in one of the following ways:

               (1) In a single lump-sum distribution; or

               (2) In annual installments not to exceed twenty (20), as selected
          by the Participant, or the Participant's life expectancy. The amount
          of cash and/or the number of shares of Common Stock in each
          installment shall be equal to the proportionate value as of each
          Valuation Date immediately preceding payment of the balance then to
          the credit of the Participant in his Account determined by dividing
          the amount credited to his Account as of such Valuation Date by the
          number of payments remaining to be made.

          If a Participant who is receiving installment payments shall establish
     to the satisfaction of the Administrative Committee, in accordance with
     principles and procedures established by the Administrative Committee which
     are applicable to all persons similarly situated, that a financial
     emergency exists in his affairs, such as illness or accident to the
     Participant or a member of his immediate family or other similar
     contingency, the Administrative Committee may, for the purpose of
     alleviating such emergency, accelerate the time of payment of some or all
     of the remaining installments. If a Participant dies before receiving all
     of the amount to the credit of his Account in accordance with this
     paragraph (2), the amount remaining to the credit of his Account at his
     death shall be distributed to his Beneficiary as soon as practicable in
     accordance with Section 12.4.

          (b) Notwithstanding a Participant's election to defer the receipt of
     the benefits under (a) above, the Administrative Committee shall direct
     payment in a single lump sum to such Participant if the balance of his
     Account does not exceed $5,000 in accordance with the requirements of Code
     Section 411(a)(11) and subject to Section 12.9. The Administrative
     Committee shall not cash-out any Participant whose Account balance exceeds
     $5,000 without the written consent of the Participant.

                                       39
<PAGE>

     12.2 Distribution upon Disability. If a Participant's employment with the
Affiliated Employers is terminated prior to his Normal Retirement Date by reason
of his total and permanent disability, as determined by the Social Security
Administration and evidenced in a writing provided to the Administrative
Committee, such disabled Participant, in addition to the withdrawal options
under Section 11.1, shall be entitled to receive the entire value credited to
his Account at such time as requested by the Participant or such legal
representative pursuant to Section 12.6 and in accordance with the procedures
established by the Administrative Committee. Any distribution pursuant to this
Section 12.2 shall be made in a single lump sum as soon as practicable after the
selected Valuation Date.

     Notwithstanding the foregoing, the Administrative Committee shall direct
payment in a single lump sum to such Participant or his legal representative if
the balance of such Participant's Account does not exceed $5,000 in accordance
with the requirements of Code Section 411(a)(11) and subject to Section 12.9.

     12.3 Distribution upon Death. If a Participant dies before he begins
receiving a distribution of his Account in accordance with this Article XII, the
entire balance credited to the Participant's Account shall be distributed as
soon as practicable to the Participant's surviving Beneficiary or Beneficiaries
in a lump sum.

     12.4 Designation of Beneficiary in the Event of Death. A Participant may
designate a Beneficiary or Beneficiaries (who may be designated contingently) to
receive all or part of the amount credited to his Account in case of his death
before his receipt of all of his benefits under the Plan, provided that the
Beneficiary of a married Participant shall be the Participant's Surviving
Spouse, unless such Surviving Spouse shall consent in a writing witnessed by a
notary public, which writing acknowledges the effect of the Participant's
designation of a Beneficiary other than such Surviving Spouse. However, if such
Participant establishes to the satisfaction of the Administrative Committee that
such written consent may not be obtained because the Surviving Spouse cannot be
located or because of such other circumstances as the Secretary of the Treasury
may by regulations prescribe, a designation by such Participant without the
consent of the Surviving Spouse shall be valid.

     Any consent necessary under this Section 12.4 shall be valid and effective
only with respect to the Surviving Spouse who signs the consent or, in the event
of a deemed consent, only with respect to a designated Surviving Spouse.

     A designation of Beneficiary may be revoked by the Participant without the
consent of any Beneficiary (or the Participant's Surviving Spouse) at any time
before the commencement of the distribution of benefits. A Beneficiary
designation or change or revocation of a Beneficiary designation shall be made
in accordance with the procedures established by the Administrative Committee.

     If no designated Beneficiary shall be living at the death of the
Participant and/or such Participant's Beneficiary designation is not valid and
enforceable under applicable law or the procedures of the Administrative
Committee, such Participant's Beneficiary or Beneficiaries shall be the person
or persons in the first of the following classes of successive preference, if
then living:

                                       40
<PAGE>

     (a)  the Participant's spouse on the date of his death,

     (b)  the Participant's children, equally,

     (c)  the Participant's parents, equally,

     (d)  the Participant's brothers and sisters, equally, or

     (e)  the Participant's executors or administrators.

     Payment to such one or more persons shall completely discharge the Plan and
the Trustee with respect to the amount so paid.

     12.5 Distribution upon Termination of Employment.

          (a) If a Participant's employment with the Affiliated Employers is
     terminated for any reason other than in accordance with Sections 12.1,
     12.2, and 12.3, the balance to the credit of the Participant's Account
     shall be payable in a single lump sum. Such lump-sum distribution shall be
     made as soon as practicable after the Participant's termination of
     employment, provided that one of the following conditions is met:

               (1) the Participant's Account Balance does not exceed $5,000 in
          accordance with Code Section 411(a)(11) (and subject to Section 12.9),
          or

               (2) in accordance with Section 12.10, the Participant elects to
          receive a distribution of his Account.

          (b) A Participant who does not receive a distribution under Section
     12.5(a)(1) may elect to defer the commencement of the distribution of his
     Account following the termination of his employment until a later Valuation
     Date, provided that such distribution shall commence not later than the
     date required under Section 12.6 of the Plan. In addition to the withdrawal
     options under Section 11.1, any deferred distribution shall commence as
     soon as practicable after the Valuation Date selected by the Participant.

     12.6 Commencement of Benefits.

          (a) Notwithstanding any other provision of the Plan, and except as
     further provided in Section 12.6(b) below, if the Participant does not
     elect to defer commencement of his benefit payments, the payment of his
     benefits shall begin at the Participant's election no later than the
     sixtieth (60th) day after the close of the Plan Year in which the latest of
     the following events occurs:

               (1) the Participant attains the earlier of age sixty five (65) or
          his Normal Retirement Date,

               (2) the Participant's tenth (10th) anniversary of participation
          under the Plan, or

                                       41
<PAGE>

               (3) the Participant's severance from employment with the
          Affiliated Employers.

          (b) In no event shall the distribution of amounts in a Participant's
     Account commence later than the April 1 of the calendar year following the
     later of the calendar year in which the Participant attains age 70 1/2 or
     terminates employment with the Affiliated Employers, in accordance with
     regulations prescribed by the Secretary of the Treasury. The foregoing
     requirements in this Section 12.6(b) shall not be applied to restrict the
     implementation of any written designation given to the Administrative
     Committee by a Participant prior to January 1, 1984, with regard to the
     method of distribution of his Account, if such method was permissible under
     the Plan and Code prior to January 1, 1984. Notwithstanding the foregoing,
     the payment of benefits to a Participant who is a five percent (5%) owner
     of The Southern Company or an Affiliated Employer (as determined pursuant
     to Code Section 416) with respect to the Plan Year ending in the calendar
     year in which the Participant attains age 70 1/2 shall begin not later than
     April 1, of the calendar year following the calendar year in which the
     Participant attains age 70 1/2 regardless of the Participant's termination
     from employment.

          Any distribution made under this Plan shall be made in accordance with
     the minimum distribution requirements of Code Section 401(a)(9), including
     the incidental death benefits requirements under Code Section 401(a)(9)(G)
     and the Treasury Regulations thereunder.

     12.7 Transfer between Employing Companies. A transfer by a Participant from
one Employing Company to another Employing Company shall not affect his
participation in the Plan. A transfer by a Participant from an Employing Company
to an Affiliated Employer that is not an Employing Company shall not be deemed
to be a termination of employment with an Employing Company.

     12.8 Distributions to Alternate Payees. If the Participant's Account under
the Plan shall become subject to any domestic relations order which (a) is a
qualified domestic relations order satisfying the requirements of Section 414(p)
of the Code and (b) requires the immediate distribution in a single lump sum of
the entire portion of the Participant's Account required to be segregated for
the benefit of an alternate payee, then the entire interest of such alternate
payee shall be distributed in a single lump sum within ninety (90) days
following the Employing Company's notification to the Participant and the
alternate payee that the domestic relations order is qualified under Section
414(p) of the Code, or as soon as practicable thereafter. Such distribution to
an alternate payee shall be made even if the Participant has not separated from
the service of the Affiliated Employers. Any other distribution pursuant to a
qualified domestic relations order shall not be made earlier than the
Participant's severance from employment, or his attainment of age fifty (50), if
earlier. Such distribution to an alternate payee shall be made only in a manner
permitted under Article XI or Article XII of the Plan and only to the extent the
Participant would be eligible for such distribution option had the Participant
retired or otherwise separated from the service of the Affiliated Employers.

                                       42
<PAGE>

     12.9 Requirement for Direct Rollovers.

          (a) Direct Rollover. Notwithstanding any provision of the Plan to the
     contrary that would otherwise limit a Distributee's election under this
     Article XII, a Distributee may elect, at the time and in the manner
     prescribed by the Administrative Committee, to have any portion of an
     Eligible Rollover Distribution paid directly to an Eligible Retirement Plan
     specified by the Distributee in a Direct Rollover.

          (b) Automatic Rollover. If a Distributee (1) fails to make an election
     in accordance with paragraph (a) above and does not elect to receive
     directly the balance to his credit (or portion thereof), and (2) such
     Distributee's Eligible Rollover Distribution is in excess of $1,000 but
     less than or equal to $5,000 as determined in accordance with Section
     12.1(b) of the Plan, the Eligible Rollover Distribution shall be rolled
     over to an "eligible retirement plan" within the meaning of Code Section
     7701(a)(37) selected by the Administrative Committee and such rollover
     balance shall be subject to the rights and conditions set forth in a
     written agreement entered into by the Administrative Committee with the
     provider of such eligible retirement plan.

     12.10 Consent and Notice Requirements. If the value of the vested portion
of a Participant's Account derived from Employing Company and Employee
contributions exceeds $5,000 determined in accordance with the requirements of
Code Section 411(a)(11), the Participant must consent to any distribution of
such vested account balance prior to his Normal Retirement Date. The consent of
the Participant shall be obtained within the ninety-day period ending on the
first day of the first period for which an amount is payable as an annuity or in
any other form under this Plan.

     The Administrative Committee shall notify the Participant of the right to
defer any distribution until the Participant's Account balance is no longer
immediately distributable. Such notification shall include a general description
of the material features and an explanation of the relative values of the
operational forms of benefit available under the Plan in a manner that would
satisfy the notice requirements of Section 417(a)(3) of the Code; such
notification shall be provided no less than 30 days and no more than 90 days
prior to the annuity starting date (or, for Plan Years beginning on or after
January 1, 2007, no more than 180 days prior to the annuity starting date).

     Distributions may commence less than 30 days after the notice required
under Section 1.411(a)-11(c) of the Treasury Regulations is given, provided
that:

          (a) the Administrative Committee informs the Participant that the
     Participant has a right to a period of at least 30 days after receiving the
     notice to consider the decision of whether or not to elect a distribution
     and a particular distribution option, and

          (b) the Participant, after receiving the notice, affirmatively elects
     a distribution.

     12.11 Form of Payment. All distributions under this Article XII shall be
made in the form of cash, provided that the person entitled to such distribution
may demand that the portion of any distribution which is attributable to Common
Stock be distributed in the form of such Common Stock to the extent of the whole

                                       43
<PAGE>

number of shares in the Participant's Account, with a cash adjustment for any
fractional shares.

     12.12 Partial Distribution upon Termination of Employment. If a
Participant's employment with the Affiliated Employers is terminated and such
Participant is deemed not to have separated from service within the meaning of
Code Section 401(k)(2)(B)(i)(I), such Participant, in addition to the withdrawal
options available under Article XI, shall be entitled to elect a lump-sum
distribution of the entire balance to the credit of his Account less the amount
credited to his Elective Employer Contribution subaccount. The amounts credited
to his Elective Employer Contribution subaccount may be distributed in a
lump-sum distribution at such time permitted pursuant to Code Section
401(k)(2)(B)(i) and Section 4.4(c) hereof. Such lump-sum distributions shall
otherwise be subject to this Article XII.

     12.13 Distribution of Dividends Payable on Common Stock. Each Participant
may elect whether (i) to receive a cash distribution of all or a portion of the
dividends payable on the shares of Common Stock credited to the Participant's
Account as of the record date of the Common Stock or (ii) to have such dividends
paid to the Plan and reinvested in Common Stock credited to the Participant's
Account. The election of a Participant whether to receive a cash distribution of
dividends shall remain in effect until such election is changed by the
Participant. In the event a Participant fails to make an election with respect
to the dividends payable on any shares of Common Stock credited to the
Participant's Account, such Participant shall be deemed to have elected to have
the dividends payable on such shares paid to the Plan and reinvested in Common
Stock credited to the Participant's Account. Upon the death of a Participant,
such Participant shall be deemed to have elected to have the dividends payable
on all shares of Common Stock credited to the Participant's Account reinvested
in Common Stock, notwithstanding any election in effect at the time of the
Participant's death.

     A Participant may change his election whether to receive a cash
distribution of dividends during the first month of each calendar quarter.
However, with respect to each dividend on Common Stock, the election, or deemed
election, of a Participant which is in effect on the last day of the first month
in the calendar quarter which includes the record date for such dividend (the
"Election Deadline") shall apply with respect to the dividends payable on the
shares of Common Stock credited to the Participant's Account on such record
date. In any event, all elections and deemed elections shall be irrevocable as
of the Election Deadline. Participants are 100% vested in dividends payable on
Common Stock. Payment of cash distributions under this Section 12.13 shall be
made to the Plan and to Participants, as the case may be, as soon as
administratively practicable following the payable date of the dividends. The
Administrative Committee may establish such administrative procedures as it
deems necessary or appropriate to effect the elections under this Section 12.13.

     Notwithstanding the foregoing provisions of this Section 12.13, a
Participant who requests a hardship withdrawal pursuant to Section 11.6 must
satisfy the requirements of Section 11.6(c)(2) by obtaining all distributions
(including the distributions of Company Stock Fund dividends under Section
404(k) of the Code, payable on the shares of Common Stock credited to the
Participant's Account at the time of the request, if any). Accordingly, such
Participant may not elect to have such dividends paid to the Plan and reinvested
in Common Stock credited to the Participant's Account.

                                       44
<PAGE>

     12.14 Qualified Hurricane Distributions.

          (a) Notwithstanding the other provisions of this Article XII,
     effective as of February 24, 2006, an individual may make a Qualified
     Hurricane Distribution from his Account, pursuant to the Gulf Opportunity
     Zone Act of 2005, as codified in Section 1400Q of the Code.

          (b) For purposes of this Section 12.14, a Qualified Hurricane
     Distribution is:

               (1) any distribution from the Plan made on or after August 25,
          2005, and before January 1, 2007, to an individual whose principal
          place of abode on August 28, 2005, is located in the Hurricane Katrina
          disaster area and who has sustained an economic loss by reason of
          Hurricane Katrina,

               (2) any distribution (which is not described in subsection (1))
          from the Plan made on or after September 23, 2005, and before January
          1, 2007, to an individual whose principal place of abode on September
          23, 2005, is located in the Hurricane Rita disaster area and who has
          sustained an economic loss by reason of Hurricane Rita, and

               (3) any distribution (which is not described in subsection (1) or
          (2)) from the Plan made on or after October 23, 2005, and before
          January 1, 2007, to an individual whose principal place of abode on
          October 23, 2005, is located in the Hurricane Wilma disaster area and
          who has sustained an economic loss by reason of Hurricane Wilma.

          (c) In determining whether an individual is eligible to make a
     Qualified Hurricane Distribution under subsection (b)(1), (b)(2), or
     (b)(3), the Administrative Committee shall rely on the reasonable
     representations of such individual, unless the Administrative Committee has
     actual knowledge to the contrary.

          (d) The following additional requirements shall apply to a Qualified
     Hurricane Distribution:

               (1) A Qualified Hurricane Distribution shall be paid to an
          individual in the form of a lump-sum payment from his Account in the
          order of priority listed below:

                    (i) All or a portion of the value of his Account
               attributable to Voluntary Participant Contributions (not
               including any earnings or appreciation thereon) made prior to
               January 1, 1987;

                                       45
<PAGE>

                    (ii) All amounts described above, plus all or a portion of
               the value of his Account attributable to Voluntary Participant
               Contributions, plus a ratable portion of the earnings and/or
               appreciation on Voluntary Participant Contributions;

                    (iii) All amounts described above, plus effective April 1,
               1997, all or a portion of the value of his Account attributable
               to Rollover Contributions (including earnings and appreciation
               thereon);

                    (iv) All amounts described above, plus all or a portion of
               the value of his Account attributable to his Employer Matching
               Contributions (including earnings and appreciation thereon)
               allocated to his Account; provided, however, that said
               Participant shall have participated in the Plan for not less than
               sixty (60) months at the time of the withdrawal;

                    (v) All amounts described above, plus all or a portion of
               the value of his Account attributable to Elective Employer
               Contributions (not including any earnings or appreciation thereon
               for Plan Years beginning after December 31, 1988);

                    (vi) All amounts described above, plus all or a portion of
               the value of his Account attributable to any earnings or
               appreciation on Elective Employer Contributions; and

                    (vii) All amounts described above, plus with respect to any
               Participant with a SEPCO Transferred Account, subject to Article
               XVIII, all or a portion of the value of such Account.

               (2) Notice of a Qualified Hurricane Distribution must be given by
          a Participant in accordance with the procedures established by the
          Administrative Committee. Subject to Code Section 1400Q, payment of a
          Qualified Hurricane Distribution shall be made as soon as practicable
          and in accordance with Section 12.10, if applicable.

               (3) All distributions under this Section 12.14 shall be made in
          the form of cash, provided that with respect to any distribution which
          is attributable to Common Stock, the Participant shall have the right
          to demand that such portion of the distribution be made in the form of
          Common Stock to the extent of the whole number of shares of Common
          Stock in his Account. Such demand must be made in accordance with the
          procedures established by the Administrative Committee.

               (4) No distribution under this Section 12.14 shall be permitted
          in an amount which has a value of less than $300, unless the value of
          the amount available under the selected option is less than $300.

                                       46
<PAGE>

               (5) Qualified Hurricane Distributions shall be made in accordance
          with the instructions of the Participant from each of the Investment
          Funds in which the amount to be distributed is invested. The value of
          the amount to be distributed under any option listed in (1) above
          shall be determined as soon as practicable in accordance with the
          procedures established by the Administrative Committee.

               (6) The aggregate amount of all Qualified Hurricane Distributions
          from the Plan shall not exceed $100,000.

          (e) The Administrative Committee shall establish procedures to
     administer Qualified Hurricane Distributions made in accordance with this
     Section 12.14.

                                       47
<PAGE>

                                  ARTICLE XIII

                           ADMINISTRATION OF THE PLAN

     13.1 Membership of Administrative Committee. The Plan shall be administered
by the Administrative Committee, which shall consist of the individual then
serving in the positions of Senior Vice President, Human Resource Services,
Southern Company Services, Inc. (which position is the successor to the Vice
President, System Compensation and Benefits of the Southern Company); the Chief
Financial Officer, Southern Company Services, Inc; the Vice President, Tax,
Southern Company Services, Inc.; and the Comptroller of Southern Company; or any
other position or positions that succeed to the duties of the foregoing
positions. The Administrative Committee shall be chaired by the Senior Vice
President, Human Resource Services, Southern Company Services, Inc. and may
select a Secretary (who may, but need not, be a member of the Administrative
Committee) to keep its records or to assist it in the discharge of its duties.

     13.2 Term. Any person serving in one of the positions set forth in Section
13.1 shall be a member of the Administrative Committee for the period of time
during which such individual serves in that position. The composition of the
Administrative Committee may be changed only by an amendment to the Plan by the
Board of Directors pursuant to its written resolutions.

     13.3 Transaction of Business. A majority of the members of the
Administrative Committee at the time in office shall constitute a quorum for the
transaction of business at any meeting. Any determination or action of the
Administrative Committee may be made or taken by a majority of the members
present at any meeting thereof or without a meeting by a resolution or written
memorandum concurred in by a majority of the members then in office.

     13.4 Administrative Committee Responsibilities in General. The Plan shall
be administered by the Administrative Committee which shall have the
discretionary authority, power, and the duty to take all actions and to make all
decisions necessary or proper to carry out the Plan and to control and manage
the operation and administration of the Plan. The Administrative Committee shall
have the discretion to interpret the Plan, including any ambiguities herein, and
to determine the eligibility for benefits under the Plan in its sole discretion.
The determination of the Administrative Committee as to any question involving
the general administration and interpretation of the Plan shall be final,
conclusive, and binding on all persons, except as otherwise provided herein or
by law, and may be relied upon by the Company, all Employing Companies, the
Trustee, the Participants, and their Beneficiaries. Any discretionary actions to
be taken under the Plan by the Administrative Committee with respect to
Employees and Participants or with respect to benefits shall be uniform in their
nature and applicable to all persons similarly situated. Benefits under the Plan
shall be paid only if the Administrative Committee or its delegate determines in
its discretion that such benefits are payable pursuant to administrative
procedures established by the Administrative Committee. Notwithstanding any
provision in the Plan to the contrary, the Administrative Committee shall be

                                       48
<PAGE>

authorized to take whatever actions it deems necessary or appropriate in its
discretion to implement administrative procedures, including, but not limited
to, suspending plan participation (to the extent permitted by applicable law)
and suspending changes in investment directions and fund transfers, even though
otherwise permitted or required under the Plan.

     13.5 Administrative Committee and Pension Fund Investment Review Committee
as Named Fiduciaries. For the purpose of compliance with the provisions of ERISA
but subject to the allocation of fiduciary responsibility to the Pension Fund
Investment Review Committee pursuant to Section 13.13 concerning the carrying
out of a funding policy and method for the Plan, the Administrative Committee
shall be the administrator of the Plan as the term "administrator" is defined in
ERISA, and the Administrative Committee shall be, with respect to the Plan, a
named fiduciary as that term is defined in ERISA. The Pension Fund Investment
Review Committee shall be the named fiduciary with respect to those matters
allocated to it under Section 13.13. For the purpose of carrying out their
duties, the Administrative Committee and the Pension Fund Investment Review
Committee may, in each Committee's respective discretion, allocate its
responsibilities under the Plan among its members and may, in its discretion,
designate persons (in writing or otherwise) other than members of its Committee
to carry out such responsibilities allocated to it under the Plan as it may see
fit.

     13.6 Rules for Plan Administration. The Administrative Committee may make
and enforce rules and regulations for the administration of the Plan consistent
with the provisions thereof and may prescribe the use of such forms or
procedures as it shall deem appropriate for the administration of the Plan.

     13.7 Employment of Agents. The Administrative Committee may employ
independent qualified public accountants, as such term is defined in ERISA, who
may be accountants to The Southern Company and any Affiliated Employer, legal
counsel who may be counsel to The Southern Company and any Affiliated Employer,
other specialists, and other persons as the Administrative Committee deems
necessary or desirable in connection with the administration of the Plan. The
Administrative Committee and any person to whom it may delegate any duty or
power in connection with the administration of the Plan, the Company and the
officers and directors thereof shall be entitled to rely conclusively upon and
shall be fully protected in any action omitted, taken, or suffered by them in
good faith in reliance upon any independent qualified public accountant,
counsel, or other specialist, or other person selected by the Administrative
Committee, or in reliance upon any tables, evaluations, certificates, opinions,
or reports which shall be furnished by any of them or by the Trustee.

     13.8 Co-Fiduciaries. It is intended that to the maximum extent permitted by
ERISA, each person who is a fiduciary (as that term is defined in ERISA) with
respect to the Plan shall be responsible for the proper exercise of his own
powers, duties, responsibilities, and obligations under the Plan and the Trust,
as shall each person designated by any fiduciary to carry out any fiduciary
responsibilities with respect to the Plan or the Trust. No fiduciary or other
person to whom fiduciary responsibilities are allocated shall be liable for any
act or omission of any other fiduciary or of any other person delegated to carry
out any fiduciary or other responsibility under the Plan or the Trust.

                                       49
<PAGE>

     13.9 General Records. The Administrative Committee shall maintain or cause
to be maintained an Account (and any separate subaccount) which accurately
reflects the interest of each Participant, as provided for in Section 9.1, and
shall maintain or cause to be maintained all necessary books of account and
records with respect to the administration of the Plan. The Administrative
Committee shall mail or cause to be mailed to Participants reports to be
furnished to Participants in accordance with the Plan or as may be required by
ERISA. Any notices, reports, or statements to be given, furnished, made, or
delivered to a Participant shall be deemed duly given, furnished, made, or
delivered when addressed to the Participant and delivered to the Participant in
person or mailed by ordinary mail to his address last communicated to the
Administrative Committee (or its delegate) or of his Employing Company.

     13.10 Liability of the Administrative Committee. In administering the Plan,
except as may be prohibited by ERISA, neither the Administrative Committee nor
any person to whom it may delegate any duty or power in connection with
administering the Plan shall be liable for any action or failure to act except
for its or his own gross negligence or willful misconduct; nor for the payment
of any amount under the Plan; nor for any mistake of judgment made by him or on
his behalf as a member of the Administrative Committee; nor for any action,
failure to act, or loss unless resulting from his own gross negligence or
willful misconduct; nor for the neglect, omission, or wrongdoing of any other
member of the Administrative Committee. No member of the Administrative
Committee shall be personally liable under any contract, agreement, bond, or
other instrument made or executed by him or on his behalf as a member of the
Administrative Committee.

     13.11 Reimbursement of Expenses and Compensation of Administrative
Committee. Members of the Administrative Committee shall be reimbursed by the
Company for expenses they may individually or collectively incur in the
performance of their duties. Each member of the Administrative Committee who is
a full time employee of the Company or of any Employing Company shall serve
without compensation for his services as such member; each other member of the
Administrative Committee shall receive such compensation, if any, for his
services as the Board of Directors may fix from time to time.

     13.12 Expenses of Plan and Trust Fund. The expenses of establishment and
administration of the Plan and the Trust Fund, including all fees of the
Trustee, auditors, and counsel, shall be paid by the Company or the Employing
Companies. Notwithstanding the foregoing, to the extent provided in the Trust
Agreement, certain administrative expenses may be paid from the Trust Fund
either directly or through reimbursement of the Company or the Employing
Companies. Any expenses directly related to the investments of the Trust Fund,
such as stock transfer taxes, brokerage commissions, or other charges incurred
in the acquisition or disposition of such investments, shall be paid from the
Trust Fund (or from the particular Investment Fund to which such fees or
expenses relate) and shall be deemed to be part of the cost of such securities
or deducted in computing the proceeds therefrom, as the case may be. Investment
management fees for the Investment Funds shall be paid from the particular
Investment Fund to which they relate. In the event the Company or an Employing
Company pays investment management fees directly, the Company or such Employing
Company shall be reimbursed for such fees from the particular Investment Fund to
which they relate, unless the Company or the Employing Company, as the case may
be, elects not to be reimbursed for such expenses. Taxes, if any, on any assets

                                       50
<PAGE>

held or income received by the Trustee and transfer taxes on the transfer of
Common Stock from the Trustee to a Participant or his Beneficiary shall be
charged appropriately against the Accounts of Participants as the Administrative
Committee shall determine. Any expenses paid by the Company pursuant to Section
13.11 and this Section 13.12 shall be subject to reimbursement by other
Employing Companies of their proportionate shares of such expenses as determined
by the Administrative Committee.

     13.13 Responsibility for Funding Policy. The Pension Fund Investment Review
Committee of The Southern Company System shall have responsibility for providing
a procedure for establishing and carrying out a funding policy and method for
the Plan consistent with the objectives of the Plan and the requirements of
Title I of ERISA. Included within the responsibility described in the preceding
sentence, where necessary to accomplish the orderly administration of the Plan
with respect to the investment of assets in a Participant's Account, the Pension
Fund Investment Review Committee may designate an Investment Fund or Investment
Funds if necessary to serve this purpose. Nothing in this Section 13.13 shall be
construed to relieve a Participant of his obligations under Article VIII or to
otherwise supersede any provision of Article VIII.

     13.14 Management of Assets. The Administrative Committee shall not have
responsibility with respect to control or management of the assets of the Plan,
nor any authority or discretion to select or terminate any Investment Funds. The
Trustee shall have the sole responsibility for the administration of the assets
of the Plan as provided in the Trust Agreement, except to the extent that an
investment advisor (who qualifies as an Investment Manager as that term is
defined in ERISA) who is appointed by the Pension Fund Investment Review
Committee shall have responsibility for the management of the assets of the
Plan, or some part thereof (including powers to acquire and dispose of the
assets of the Plan, or some part thereof).

     13.15 Notice and Claims Procedures. Pursuant to the requirements of ERISA
and the regulations thereunder of the Secretary of Labor from time to time in
effect, the Administrative Committee shall:

          (a) provide adequate notice in writing to any Participant or
     Beneficiary whose claim under the Plan has been denied, setting forth
     specific reasons for such denial, written in a manner calculated to be
     understood by such Participant or Beneficiary, and

          (b) afford a reasonable opportunity to any Participant or Beneficiary
     whose claim has been denied for a full and fair review of the decision
     denying the claim.

     Notice and claims procedures established by the Administrative Committee
for this purpose shall comply with ERISA, shall be set forth in the Summary Plan
Description for the Plan and are incorporated herein by reference. The decision
of the Administrative Committee on review of a claim which has been denied shall
be final and conclusive. In addition to the foregoing, a Participant or
Beneficiary shall not be permitted to bring any suit at law or in equity or any
other legal claim concerning the Plan without first exhausting the remedies
available hereunder as set forth in claims procedures described in the Summary
Plan Description of the Plan. Notwithstanding the foregoing, to the fullest
extent permitted by law, no action at law or equity to recover under this Plan
shall be commenced later than six months from the date of the decision of the
Administrative Committee on appeal (or if no decision is furnished, six months

                                       51
<PAGE>

from the final date of the period during which the Administrative Committee is
required to provide notification of its determination under regulations issued
by the Secretary of Labor). The review procedures described and authorized
herein and under the Summary Plan Description are the exclusive dispute
resolution procedures provided under the Plan.

     13.16 Bonding. Unless otherwise determined by the Board of Directors or
required by law, no member of the Administrative Committee shall be required to
give any bond or other security in any jurisdiction.

     13.17 Multiple Fiduciary Capacities. Any person or group of persons may
serve in more than one fiduciary capacity with respect to the Plan, and any
fiduciary with respect to the Plan may serve as a fiduciary with respect to the
Plan in addition to being an officer, employee, agent, or other representative
of a party in interest, as that term is defined in ERISA.

                                       52
<PAGE>

                                  ARTICLE XIV

                               TRUSTEE OF THE PLAN

     14.1 Trustee. The Company has entered into a Trust Agreement with the
Trustee to hold the funds necessary to provide the benefits set forth in the
Plan. If the Board of Directors so determines, the Company may enter into a
Trust Agreement or Trust Agreements with additional trustees. Any Trust
Agreement may be amended by the Company from time to time in accordance with its
terms. Any Trust Agreement shall provide, among other things, that all funds
received by the Trustee thereunder will be held, administered, invested, and
distributed by the Trustee, and that no part of the corpus or income of the
Trust held by the Trustee shall be used for or diverted to purposes other than
for the exclusive benefit of Participants or their Beneficiaries, except as
otherwise provided in the Plan. Any Trust Agreement may also provide that the
investment and reinvestment of the Trust Fund, or any part thereof may be
carried out in accordance with directions given to the Trustee by any Investment
Manager or Investment Managers (as that term is defined in ERISA) who may be
appointed by the Pension Fund Investment Review Committee. The Board of
Directors may remove any Trustee or any successor Trustee, and any Trustee or
any successor Trustee may resign. Upon removal or resignation of a Trustee, the
Board of Directors shall appoint a successor Trustee.

     14.2 Purchase of Common Stock. As soon as practicable after receipt of
funds applicable to the purchase of Common Stock, the Trustee shall purchase
Common Stock or cause Common Stock to be purchased. Such Common Stock may be
purchased on the open market or by private purchase (including private purchases
directly from The Southern Company); provided that (a) no private purchase may
be made at any price greater than the last sale price or highest current
independent bid price, whichever is higher, for Common Stock on the New York
Stock Exchange, plus an amount equal to the commission payable in a stock
exchange transaction; (b) if such private purchase shall be a purchase of Common
Stock directly from The Southern Company, no commission shall be paid with
respect thereto unless such commission satisfies the requirements of Prohibited
Transaction Class Exemption 75-1; and (c) the Trustee may purchase Common Stock
directly from The Southern Company under The Southern Investment Plan, as from
time to time amended, or under any other similar plan made available to holders
of record of shares of Common Stock which may be in effect from time to time, at
the purchase price provided for in such plan. The Trustee may hold in cash, and
may temporarily invest funds applicable to the purchase of Common Stock in short
term United States obligations, other obligations guaranteed by the United
States Government, commercial paper, or certificates of deposit, and if the
Trustee so determines, may transfer such funds to money market funds utilized by
the Trustee for qualified employee benefit trusts.

     14.3 Voting of Common Stock. Before each annual or special meeting of
shareholders of The Southern Company, there shall be sent to each Participant a
copy of the proxy soliciting material for the meeting, together with a form
requesting instructions to the Trustee on how to vote the shares of Common Stock
credited to such Participant's Account as of the record date of the Common
Stock. If a Participant does not provide the Trustee or its designated agent

                                       53
<PAGE>

with timely voting instructions for the Trustee, the Pension Fund Investment
Review Committee or its delegate may direct the Trustee how to vote such
Participant's shares. If the Pension Fund Investment Review Committee or its
delegate does not provide the Trustee or its designated agent with timely voting
instructions, the Trustee, if required to do so by applicable law, may vote such
Participant's shares. The Pension Fund Investment Review Committee or its
delegate may direct the Trustee with respect to voting unallocated shares of
Common Stock, if any. If the Pension Fund Investment Review Committee or its
delegate does not provide the Trustee or its designated agent with timely voting
instructions, the Trustee, if required to do so by applicable law, may vote such
unallocated shares.

     14.4 Voting of Other Investment Fund Shares. The Pension Fund Investment
Review Committee or its delegate may direct the Trustee with respect to voting
the shares in any Investment Fund other than the Company Stock Fund. To the
extent an Investment Manager has been designated with respect to an Investment
Fund, such Investment Manager (and not the Pension Fund Investment Review
Committee) shall direct the Trustee with respect to voting the shares in such
Investment Fund. If the Investment Manager does not direct the Trustee with
respect to voting such shares, the Pension Fund Investment Review Committee may
direct the Trustee with respect to voting such shares. If the Pension Fund
Investment Review Committee does not provide the Trustee or its designated agent
with timely voting instructions, the Trustee, if required to do so by applicable
law, may vote such shares.

     14.5 Uninvested Amounts. The Trustee may keep uninvested an amount of cash
sufficient in its opinion to enable it to carry out the purposes of the Plan.

     14.6 Independent Accounting. The Board of Directors shall select a firm of
independent public accountants to examine and report annually on the financial
position and the results of operation of the Trust forming a part of the Plan.

                                       54
<PAGE>

                                   ARTICLE XV

                      AMENDMENT AND TERMINATION OF THE PLAN

     15.1 Amendment of the Plan. The Plan may be amended or modified by the
Board of Directors pursuant to its written resolutions at any time and from time
to time; provided, however, that no such amendment or modification shall make it
possible for any part of the corpus or income of the Trust Fund to be used for
or diverted to purposes other than for the exclusive benefit of Participants or
their Beneficiaries under the Plan, including such part as is required to pay
taxes and administration expenses of the Plan. The Plan may also be amended or
modified by the Administrative Committee (a) if such amendment or modification
does not involve a substantial increase in cost to any Employing Company, or (b)
as may be necessary, proper, or desirable in order to comply with laws or
regulations enacted or promulgated by any federal or state governmental
authority and to maintain the qualification of the Plan under Sections 401(a)
and 501(a) of the Code and the applicable provisions of ERISA as provided in
regulations prescribed by the Secretary of the Treasury.

     No amendment to the Plan shall have the effect of decreasing a
Participant's vested interest in his Account, determined without regard to such
amendment, as of the later of the date such amendment is adopted or the date it
becomes effective. In addition, if the vesting schedule of the Plan is amended,
any Participant who has completed at least three (3) Years of Service and whose
vested interest is at any time adversely affected by such amendment may elect to
have his vested interest determined without regard to such amendment during the
election period defined under Section 411(a)(10) of the Code. Finally, no
amendment shall eliminate an optional form of benefit in violation of Code
Section 411(d)(6).

     15.2 Termination of the Plan. It is the intention of the Employing
Companies to continue the Plan indefinitely. However, the Board of Directors
pursuant to its written resolutions may at any time and for any reason suspend
or terminate the Plan or suspend or discontinue the making of contributions of
all Participants and of contributions by all Employing Companies. Any Employing
Company may, by action of its board of directors and approval of the Board of
Directors, suspend or terminate the making of contributions of Participants in
the employ of such Employing Company and of contributions by such Employing
Company.

     In the event of termination of the Plan or partial termination or upon
complete discontinuance of contributions under the Plan by all Employing
Companies or by any one Employing Company, the amount to the credit of the
Account of each Participant whose Employing Company shall be affected by such
termination or discontinuance shall be determined as of the next Valuation Date
and shall be distributed to him or his Beneficiary thereafter at such time or
times and in such nondiscriminatory manner as is determined by the
Administrative Committee in compliance with the restrictions on distributions
set forth in Code Section 401(k).

                                       55
<PAGE>

     15.3 Merger or Consolidation of the Plan. The Plan shall not be merged or
consolidated with nor shall any assets or liabilities thereof be transferred to
any other plan unless each Participant of the Plan would (if the Plan then
terminated) receive a benefit immediately after the merger, consolidation, or
transfer which is equal to or greater than the benefit he would have been
entitled to receive immediately prior to the merger, consolidation, or transfer
(if the Plan had then terminated).

                                       56
<PAGE>

                                  ARTICLE XVI

                             TOP HEAVY REQUIREMENTS

     16.1 Top-Heavy Plan Requirements. For any Plan Year the Plan shall be
determined to be a top-heavy plan, the Plan shall provide the minimum allocation
requirement of Section 16.3.

     16.2 Determination of Top-Heavy Status.

          (a) For any Plan Year commencing after December 31, 1983, the Plan
     shall be determined to be a top-heavy plan, if, as of the Determination
     Date, the sum of the Aggregate Accounts of Key Employees under this Plan
     exceeds 60% of the Aggregate Accounts of all Employees entitled to
     participate in this Plan.

          (b) For any Plan Year commencing after December 31, 1983, the Plan
     shall be determined to be a super-top-heavy plan, if, as of the
     Determination Date, the sum of the Aggregate Accounts of Key Employees
     under this Plan exceeds 90% of the Aggregate Accounts of all Employees
     entitled to participate in this Plan.

          (c) In the case of a Required Aggregation Group, each plan in the
     group will be considered a top-heavy plan if the Required Aggregation Group
     is a Top-Heavy Group. No plan in the Required Aggregation Group will be
     considered a top-heavy plan if the Aggregation Group is not a Top-Heavy
     Group.

          In the case of a Permissive Aggregation Group, only a plan that is
     part of the Required Aggregation Group will be considered a top-heavy plan
     if the Permissive Aggregation Group is a Top-Heavy Group. A plan that is
     not part of the Required Aggregation Group but that has nonetheless been
     aggregated as part of the Permissive Aggregation Group will not be
     considered a top-heavy plan even if the Permissive Aggregation Group is a
     Top-Heavy Group.

          (d) For purposes of this Article XVI, if any Employee is a non-Key
     Employee for any Plan Year, but such Employee was a Key Employee for any
     prior Plan Year, such Employee's Present Value of Accrued Retirement Income
     and/or Aggregate Account balance shall not be taken into account for
     purposes of determining whether this Plan is a top-heavy or super-top-heavy
     plan (or whether any Aggregation Group which includes this Plan is a
     Top-Heavy Group). In addition, if an Employee or former Employee has not
     performed any services for any Employing Company maintaining the Plan at
     any time during the one-year period ending on the Determination Date, the
     Aggregate Account and/or Present Value of Accrued Retirement Income shall
     be excluded in determining whether this Plan is a top-heavy or
     super-top-heavy plan.

                                       57
<PAGE>

          (e) Only those plans of the Affiliated Employers in which the
     Determination Dates fall within the same calendar year shall be aggregated
     in order to determine whether such plans are top-heavy plans.

     16.3 Minimum Allocation for Top-Heavy Plan Years.

          (a) Notwithstanding anything herein to the contrary, for any top-heavy
     Plan Year, the Employing Company contribution allocated to the Account of
     each non-Key Employee shall be an amount not less than the lesser of: (1)
     3% of such Participant's compensation for that Plan Year, or (2) a
     percentage of that Participant's compensation not to exceed the percentage
     at which contributions are made under the Plan for the Key Employee for
     whom such percentage is highest for that Plan Year.

          (b) For purposes of the minimum allocation of Section 16.3(a), the
     percentage allocated to the Account of any Key Employee shall be equal to
     the ratio of the Employing Company contributions allocated on behalf of
     such Key Employee divided by the compensation of such Key Employee for that
     Plan Year. Employer Matching Contributions shall be taken into account for
     purposes of satisfying the minimum contribution allocation requirements
     under Code Section 416(c)(2) and the Plan.

          (c) For any top-heavy Plan Year, the minimum allocations of Section
     16.3(a) shall be allocated to the Accounts of all non-Key Employees who are
     Participants and who are employed by the Affiliated Employers on the last
     day of the Plan Year.

          (d) Notwithstanding the foregoing, in any Plan Year in which a non-Key
     Employee is a Participant in both this Plan and a defined benefit plan, and
     both such plans are top-heavy plans, the Affiliated Employers shall not be
     required to provide a non-Key Employee with both the full separate minimum
     defined benefit and the full separate defined contribution plan
     allocations. Therefore, if a non-Key Employee is participating in a defined
     benefit plan maintained by the Affiliated Employers and the minimum benefit
     under Code Section 416(c)(1) is provided the non-Key Employee under such
     defined benefit plan, the minimum allocation provided for above shall not
     be applicable, and no minimum allocation shall be made on behalf of the
     non-Key Employee. Alternatively, the Employing Company may satisfy the
     minimum allocation requirement of Code Section 416(c)(2) for the non-Key
     Employee by providing any combination of benefits and/or contributions that
     satisfy the safe harbor rules of Treasury Regulation Section 1.416-1(M-12).

          (e) For all top-heavy purposes other than the determination of whether
     an Employee is a Key Employee, "compensation" shall mean all payments by
     the employer to an Eligible Participant included as wages within the
     meaning of Code Section 3401(a) and all other payments of compensation to
     an Eligible Participant by the employer (in the course of the employer's
     trade or business) for which the employer is required to furnish the
     Eligible Participant a written statement under Code Sections 6041(d),
     6051(a)(3) and 6052. Compensation for this purpose shall be determined
     without regard to any rules under Code Section 3401(a) that limit the
     remuneration included in wages based on the nature or location of the
     Eligible Participant or the services performed. Compensation shall also

                                       58
<PAGE>

     include (i) an Eligible Participant's elective deferrals under Code
     Sections 402(g)(3) and 414(v), (ii) amounts contributed or deferred under
     Code Section 125 by the employer at the Eligible Participant's election
     that are not includible in the Eligible Participant's gross income, and
     (iii) amounts which are not includible in an Eligible Participant's gross
     income by reason of Code Sections 132(f)(4) or 457. Compensation also shall
     be limited pursuant to Code Section 401(a)(17).

                                       59
<PAGE>

                                  ARTICLE XVII

                               GENERAL PROVISIONS

     17.1 Plan Not an Employment Contract. The Plan shall not be deemed to
constitute a contract between an Affiliated Employer and any Employee, nor shall
anything herein contained be deemed to give any Employee any right to be
retained in the employ of an Employing Company or to interfere with the right of
an Employing Company to discharge any Employee at any time and to treat him
without regard to the effect which such treatment might have upon him as a
Participant.

     17.2 No Right of Assignment or Alienation. Except as may be otherwise
permitted or required by law, no right or interest in the Plan of any
Participant or Beneficiary and no distribution or payment under the Plan to any
Participant or Beneficiary shall be subject in any manner to anticipation,
alienation, sale, transfer (except by death), assignment (either at law or in
equity), pledge, encumbrance, charge, attachment, garnishment, levy, execution,
or other legal or equitable process, whether voluntary or involuntary, and any
attempt to so anticipate, alienate, sell, transfer, assign, pledge, encumber,
charge, attach, garnish, levy, or execute or enforce any other legal or
equitable process against the same shall be void, nor shall any such right,
interest, distribution, or payment be in any way liable for or subject to the
debts, contracts, liabilities, engagements, or torts of any person entitled to
such right, interest, distribution, or payment. If any Participant or
Beneficiary is adjudicated bankrupt or purports to anticipate, alienate, sell,
transfer, assign, pledge, encumber, or charge any such right, interest,
distribution, or payment, voluntarily or involuntarily, or if any action shall
be taken which is in violation of the provisions of the immediately preceding
sentence, the Administrative Committee may hold or apply or cause to be held or
applied such right, interest, distribution, or payment or any part thereof to or
for the benefit of such Participant or Beneficiary in such manner as is in
accordance with applicable law. In addition, a Participant's benefits may be
offset pursuant to a judgment, order, or decree issued (or settlement agreement
entered into) on or after August 5, 1997, if and to the extent that such offset
is permissible or required under Code Section 401(a)(13).

     Notwithstanding the above, the Administrative Committee and the Trustee
shall comply with any domestic relations order (as defined in Section
414(p)(1)(B) of the Code) which is a qualified domestic relations order
satisfying the requirements of Section 414(p) of the Code. The Administrative
Committee shall establish procedures for (a) notifying Participants and
alternate payees who have or may have an interest in benefits which are the
subject of domestic relations orders, (b) determining whether such domestic
relations orders are qualified domestic relations orders under Section 414(p) of
the Code, and (c) distributing benefits which are subject to qualified domestic
relations orders.

     17.3 Payment to Minors and Others. If the Administrative Committee
determines that any person entitled to a distribution or payment from the Trust
Fund is an infant or a minor, is incompetent, or is unable to care for his
affairs by reason of physical or mental disability, it may cause all
distributions or payments thereafter becoming due to such person to be made to
any other person for his benefit, without responsibility to follow the

                                       60
<PAGE>

application of payments so made. Payments made pursuant to this provision shall
completely discharge the Company, the Trustee, and the Administrative Committee
with respect to the amounts so paid. No person shall have any rights under the
Plan with respect to the Trust Fund, or against the Trustee or any Employing
Company, except as specifically provided herein.

     17.4 Source of Benefits. The Trust Fund established under the Plan shall be
the sole source of the payments or distributions to be made in accordance with
the Plan. No person shall have any rights under the Plan with respect to the
Trust Fund, or against the Trustee or any Employing Company, except as
specifically provided herein.

     17.5 Unclaimed Benefits. If the Administrative Committee is unable, within
five (5) years after any distribution becomes payable to a Participant or
Beneficiary, to make or direct payment to the person entitled thereto because
the identity or whereabouts of such person cannot be ascertained,
notwithstanding the mailing of due notice to such person at his last known
address as indicated by the records of either the Administrative Committee or
his Employing Company, then such benefit or distribution will be disposed of as
follows:

          (a) If the whereabouts of the Participant is unknown to the
     Administrative Committee, distribution will be made to the Participant's
     Beneficiary or Beneficiaries.

          Payment to such one or more persons shall completely discharge the
     Company, the Trustee, and the Administrative Committee with respect to the
     amounts so paid.

          (b) If none of the persons described in (a) above, can be located,
     then the benefit payable under the Plan shall be forfeited and shall be
     applied to reduce future Employer Matching Contributions. Notwithstanding
     the foregoing sentence, such benefit shall be reinstated if a claim is made
     by the Participant or Beneficiary for the forfeited benefit.

     In the event the Administrative Committee makes or directs a payment to the
person entitled thereto but the check for such payment remains un-cashed for a
period of 180 days, the Administrative Committee shall take such actions as it
deems reasonable to determine the whereabouts of such person. If the whereabouts
of the person is unknown or the check remains un-cashed, the Administrative
Committee shall direct that such check be cancelled. In the event the person
entitled to such payment subsequently requests payment, the Administrative
Committee shall direct such payment to such person in the amount of the previous
check.

     17.6 Governing Law. The provisions of the Plan and the Trust shall be
construed, administered, and enforced in accordance with the laws of the State
of Georgia, except to the extent such laws are preempted by the laws of the
United States.

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<PAGE>

                                 ARTICLE XVIII

                    SPECIAL REQUIREMENTS FOR ACCOUNT BALANCES

                        ATTRIBUTABLE TO ACCRUED BENEFITS

                         TRANSFERRED FROM THE SEPCO PLAN

     18.1 SEPCO Transferred Accounts. Notwithstanding any other provisions of
this Plan to the contrary, a Participant's SEPCO Transferred Account shall be
subject to the requirements of this Article XVIII. The Trustee is specifically
authorized to accept any rollover accounts under the terms of the SEPCO Plan as
are necessary to reflect a Participant's interest in the Plan resulting from the
merger of the SEPCO Plan into this Plan effective as of January 1, 1993.

     18.2 In-Service Withdrawals from SEPCO Transferred Accounts. Except as
provided in this Section 18.2, a Participant shall be entitled to a distribution
of his SEPCO Transferred Account at the same time he is entitled to a
distribution of his Account under the applicable provisions of Article XII.

          (a) Age 59 1/2. A Participant who has attained age 59 1/2 shall have
     the right to withdraw all or a portion of his SEPCO Transferred Account in
     accordance with Section 11.6(e) provided that he shall have first withdrawn
     all other amounts available to him in accordance with the terms and order
     of priority set forth in Section 11.1.

          (b) Hardship. A Participant who meets the requirements for hardship
     set forth in Section 11.6 hereof shall be entitled to withdraw amounts
     determined necessary to relieve such hardship from his SEPCO Transferred
     Account, provided that he shall have first withdrawn all other amounts
     available to him in accordance with the terms and order of priority set
     forth in Section 11.1.

     18.3 Loans from SEPCO Transferred Accounts. Subject to the provisions of
Section 11.7, a Participant may request that a loan be made to him from his
SEPCO Transferred Account, provided, however, that the Participant has first
borrowed all other amounts available to him under the terms of the Plan.

     A Participant must obtain the consent of his or her spouse, if any, to use
any portion of his SEPCO Transferred Account as security for a loan. Within the
ninety-day period ending on the date on which a loan is made to a Participant
who is married, the Participant shall obtain and deliver to the Administrative
Committee the written consent of the Participant's spouse (1) to the loan, and
(2) to the reduction of the Participant's Account if the Participant's Account
is reduced because of nonpayment or other default with respect to the loan. No
further spousal consent shall be required in the event the Participant's Account
is subsequently reduced with respect to such loan, even if the Participant is
then married to a different spouse. A new spousal consent shall be required for
any subsequent loan to a Participant, if the Participant is then married.

                                       62
<PAGE>

     18.4 Distribution of SEPCO Transferred Accounts. Notwithstanding any
provisions of this Plan to the contrary, a Participant with a SEPCO Transferred
Account shall be paid the vested benefits of the SEPCO Transferred Account upon
retirement, death, total and permanent disability, or termination of employment
as provided herein.

          (a) All benefits from a Participant's SEPCO Transferred Account shall
     be distributed in accordance with the distribution options available under
     Article XII, with applicable spousal consent as provided under the SEPCO
     Plan, unless a Participant elects payment of benefits in the form of a life
     annuity pursuant to a written election filed with the Administrative
     Committee prior to commencement of distribution of benefits. The provisions
     of this Section 18.4 shall take precedence over any conflicting provisions
     of the Plan and shall apply to any Participant who has a SEPCO Transferred
     Account and who elects to receive payment of his benefits from his SEPCO
     Transferred Account in the form of a life annuity. A married Participant
     electing to receive benefits in the form of a life annuity shall receive
     the value of his benefit in the form of a qualified joint and survivor
     annuity, which shall provide an annuity for the life of the Participant
     with a survivor annuity for the life of the Participant's spouse which is
     either 50% or 100%, as elected by the Participant, of the amount of the
     annuity which is payable during the joint lives of the Participant and the
     Participant's spouse, and which is the actuarial equivalent of a single
     life annuity for the life of the Participant. An unmarried Participant who
     elects a life annuity shall receive the value of his benefits from his
     SEPCO Transferred Account in the form of an annuity for his lifetime.

          (b) If the Participant's interest is to be distributed in other than a
     single sum, the amount required to be distributed for each calendar year,
     beginning with distributions for the first Distribution Calendar Year, must
     at least equal the quotient obtained by dividing the Participant's Benefit
     by the Applicable Life Expectancy.

          (c) The minimum distribution required for the Participant's first
     Distribution Calendar Year must be made on or before the Participant's
     Required Beginning Date. The minimum distribution for other calendar years,
     including the minimum distribution for the Distribution Calendar Year in
     which the Participant's Required Beginning Date occurs, must be made on or
     before December 31 of that Distribution Calendar Year.

          (d) If the Participant's benefit is distributed in the form of an
     annuity purchased from an insurance company, distributions thereunder shall
     be made in accordance with the requirements of Section 401(a)(9) of the
     Code and the proposed regulations thereunder.

          (e) Definitions.

               (1) "Applicable Life Expectancy" means the life expectancy
          calculated using the attained age of the Participant as of the
          Participant's birthday in the applicable calendar year reduced by one
          for each calendar year which has elapsed since the date life
          expectancy was first calculated. If life expectancy is being
          recalculated, the applicable life expectancy shall be the life
          expectancy as so recalculated. The applicable calendar year shall be

                                       63
<PAGE>

          the first Distribution Calendar Year, and if life expectancy is being
          recalculated such succeeding calendar year.

               (2) "Distribution Calendar Year" means a calendar year for which
          a minimum distribution is required. For distributions beginning before
          the Participant's death, the first Distribution Calendar Year is the
          calendar year immediately preceding the calendar year which contains
          the Participant's Required Beginning Date.

               (3) "Participant's Benefit" means the account balance as of the
          last valuation date in the calendar year immediately preceding the
          Distribution Calendar Year (valuation calendar year) increased by the
          amount of any contributions or forfeitures allocated to the account
          balance as of dates in the valuation calendar year after the valuation
          date and decreased by distributions made in the valuation calendar
          year after the valuation date. If any portion of the minimum
          distribution for the first Distribution Calendar Year is made in the
          second Distribution Calendar Year on or before the Required Beginning
          Date, the amount of the minimum distribution made in the second
          Distribution Calendar Year shall be treated as if it had been made in
          the immediately preceding Distribution Calendar Year.

               (4) "Required Beginning Date" means April 1st of the calendar
          year following the calendar year in which the Participant attains age
          70-1/2, in accordance with regulations prescribed by the Secretary of
          the Treasury.

          (f) Notwithstanding anything contained herein to the contrary, the
     requirements of this Section 18.4 shall apply to any distribution of a
     Participant's interest and will take precedence over any inconsistent
     provisions of this Plan. All distributions required under this Section 18.4
     shall be determined and made in accordance with the proposed regulations
     under Section 401(a)(9), including the minimum distribution incidental
     benefit requirement of Section 1.401(a)(9)-2 of the proposed regulations.

     18.5 Code Section 411(d)(6) Protected Benefits.

     Notwithstanding any of the foregoing, the provisions of this Article XVIII
to effectuate the merger of the SEPCO Plan into this Plan shall not decrease a
Participant's accrued benefit, except to the extent permitted under Section
412(c)(8) of the Code, and shall not reduce or eliminate Code Section 411(d)(6)
protected benefits determined immediately prior to the date of such merger. The
Administrative Committee shall disregard any part of this Article XVIII or the
Plan to the extent that application of such would fail to satisfy this
paragraph. If the Administrative Committee disregards any portion of this
Article XVIII or the Plan because it would eliminate a protected benefit, the
Administrative Committee shall maintain a schedule of any such impacted early
retirement option or other optional forms of benefit and the Plan shall continue
such for the affected Participants. Notwithstanding the foregoing, any optional
form of benefit provided under this Plan solely as a result of the merger of the
SEPCO Plan into this Plan shall be eliminated to the extent permitted and in
accordance with the regulations prescribed by the Secretary of the Treasury
under Code Section 411(d)(6), provided that the elimination of such optional

                                       64
<PAGE>

form of benefit shall not be effective before the earlier of (a) the 90th day
after the Participant receives a summary of material modification describing the
elimination of such optional form of benefit or (b) January 1, 2002.

     IN WITNESS WHEREOF, the Company has caused this amendment and restatement
of The Southern Company Employee Savings Plan effective as of December 20, 2006,
to be executed this 19th day of December, 2006.

                                    SOUTHERN COMPANY SERVICES, INC.

                                    By: /s/Robert A. Bell

                                    Title: SVP H.R. Services

ATTEST:

By: /s/Patricia L. Roberts

Title:  Secretary

                                       65
<PAGE>

                        APPENDIX A - EMPLOYING COMPANIES

         The Employing Companies as of December 20, 2006 are:

                  Alabama Power Company
                  Georgia Power Company
                  Gulf Power Company
                  Mississippi Power Company
                  Southern Communications Services, Inc.
                  Southern Company Energy Solutions, LLC
                  Southern Company Services, Inc.
                  Southern Nuclear Operating Company, Inc.

                                       66
<PAGE>

                                 FIRST AMENDMENT
                                     TO THE
                                SOUTHERN COMPANY
                              EMPLOYEE SAVINGS PLAN

     WHEREAS, Southern Company Services, Inc. ("Company") adopted the latest
amendment and restatement of The Southern Company Employee Savings Plan
("Plan"), effective as of December 20, 2006; and

     WHEREAS, the Company has authorized its officers to amend the Plan to
provide for the designation of the Plan Administration Committee, the members of
which to be appointed by the Fiduciary Oversight Committee of the Board of
Directors, to serve as the Plan's Administrative Committee which is the entity
responsible for plan administration; and

     WHEREAS, the appointed members of the Plan Administration Committee replace
the existing members of the Administrative Committee effective May 31, 2007
pursuant to action taken by the Fiduciary Oversight Committee; and

     WHEREAS, pursuant to Notice 2005-5, Q&A 16, the Administrative Committee
wishes to clarify the Sixth Amendment to the Plan, as amended and restated
effective January 1, 2002, during the Plan's EGTRRA remedial amendment period
concerning the effective date of the Plan's automatic rollover provisions; and

     WHEREAS, pursuant to Section 15.1 of the Plan, the Administrative Committee
is authorized to amend the Plan at any time, provided that the amendment does
not involve a substantial increase in cost to any Employing Company or is
necessary or desirable to comply with the laws and regulations applicable to the
Plan.

     NOW, THEREFORE, the Administrative Committee hereby amends the Plan as
follows:

                                       1.

     Effective March 28, 2005, Section 12.9 (b) is amended by adding the
following to the end thereof:

     This subsection (b) is applicable to distributions made on or after March
     28, 2005. Notwithstanding the preceding, pursuant to the transition rule in
     Notice 2005-5, Q&A-9, the Plan shall delay processing of automatic
     rollovers for the 2005 Plan Year under this subsection (b) because of
     insufficient administrative procedures for automatic rollovers to a date on
     or after October 6, 2005 but before the end of the Plan Year.

                                       2.

     Effective May 31, 2007, Section 13.1 is deleted in its entirety and
replaced with the following:

     13.1 Membership of the Administrative Committee. The Plan shall be
     administered by the Plan Administration Committee the members of which
     shall be appointed from time to time by the Fiduciary Oversight Committee
     of the Board of Directors. Under the terms of the Plan, the Plan
     Administration Committee shall be referred to as the Administrative
     Committee as provided in Section 2.5. The Administrative Committee shall

<PAGE>

     govern itself in accordance with the terms of the Charter for the Plan
     Administration Committee approved by the Fiduciary Oversight Committee of
     the Board.

                                       3.

     Effective May 31, 2007, Section 13.2 is deleted in its entirety and
replaced with the following:

     13.2 Term. Any person serving in one of the positions set forth in Section
     13.1 shall be a member of the Administrative Committee for the period of
     time during which such individual serves as a member of the Plan
     Administration Committee. The composition of the Administrative Committee
     may be changed only by action of the Fiduciary Oversight Committee of the
     Board of Directors.

                                       4.

     Effective May 31, 2007, Section 13.3 is deleted in its entirety and
replaced with the following:

     13.3 Transaction of Business. The transaction of business by the
     Administrative Committee shall be accomplished in accordance with the
     Charter for the Plan Administration Committee approved by the Fiduciary
     Oversight Committee of the Board.

                                       5.

     Except as amended by this First Amendment, the Plan shall remain in full
force and effect.

     IN WITNESS WHEREOF, Southern Company Services, Inc., through the duly
authorized members of the Plan's Administrative Committee, has adopted this
First Amendment to The Southern Company Employee Savings Plan this 7th day of
November, 2007.

                                                     ADMINISTRATIVE COMMITTEE

                                                     /s/Tim Fallaw
                                                     /s/Gordon G. Martin
                                                     /s/Robert A. Bell
                                                     /s/P. Bernard Jacob

                                       2EXHIBIT 10.2

 

	
 
 	
UNITED FIRE & CASUALTY COMPANY
 

	
 
 	
EMPLOYEE STOCK PURCHASE PLAN
 

 

AMENDED AND RESTATED AS OF NOVEMBER 16, 2007

 

1.         Purpose.  The purpose of the Employee Stock Purchase Plan (the (Plan() is to provide the employees of UNITED FIRE & CASUALTY COMPANY and its subsidiaries  (hereinafter called the (Company() with a convenient way to become shareholders in the Company.  It is believed that employee participation in the ownership of the Company will help to achieve the unity of purpose essential to the continued growth of the Company and the mutual benefit of its employees and shareholders.

 

2.         Terms of Plan.  The Plan will continue from year to year, but it may be modified or discontinued by the Company at any time.

 

	
 
 	
3.
 	
Eligibility.  All employees of the Company are eligible to participate.
 

 

4.         Participation.   Employees who wish to participate in the Plan shall execute an Election Form to be furnished by the Company electing to participate in the Plan and  authorizing and instructing the Company to deduct from their pay a specified amount, to be applied to the purchase of the Company(s common stock.  Payroll deductions may not be less than Ten Dollars ($10) per pay period and must be in whole dollar amounts only.  The deduction will be made at each pay period.  Payroll deductions may not exceed Twelve Thousand Dollars ($12,000) in any calendar year.  Upon written request to the Company by the employee, the amount of payroll deduction will be changed or discontinued.  A request to discontinue payroll deduction will not cause
termination of an employee(s participation in the Plan unless an employee elects to terminate participation pursuant to paragraph 14.  Nonparticipating employees may at any time elect to participate in the Plan by delivering a completed Election Form to the Company.  Payroll deductions will commence with paychecks issued not later than the second pay period following receipt of the employee(s Election Form authorizing payroll deductions.  The purchase of Shares in accordance with the Plan will commence after remittance of one (1) month(s deductions to the bank appointed to act as the financial agent (hereinafter referred to as the (Custodian Bank().

 

5.         Special Purchases.  In addition to payroll deduction, participants in the Plan may make optional cash payments directly to the Company for the purchase of stock under the Plan.  To make such optional cash payments, participants must utilize the form provided for that purpose by the Company.  Optional cash payments must be in whole dollar amounts of not less than Ten Dollars ($10).  Cumulative optional cash contributions made during any calendar year may not exceed Twelve Thousand Dollars ($12,000).  The Company will remit optional cash payments received pursuant to this paragraph to the Custodian Bank with the next following remittance made pursuant to paragraph 7.

 

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6.         Delivery of Funds.  All amounts withheld from an employee's compensation (pursuant to paragraph 4 hereof) or otherwise paid into the Plan by the employee (pursuant to paragraph 5 hereof) shall be remitted to the Custodian Bank from time to time but no later than the tenth (10th) day of each month for the purpose of purchasing stock for the employee(s account pursuant to paragraph 7.

 

7.         Purchase of Stock.  Within thirty (30) days following the date of each remittance the Custodian Bank will, in a single transaction, apply all of the funds remitted by the Company to the purchase of the Company(s common shares on the NASDAQ National Market System through an NASD member firm, at prevailing market prices.  Purchases will be made in the name of the Custodian Bank for each employee's account under the Plan.

 

8.         Share Ownership; Issuance of Stock.  The shares of stock purchased for an employee pursuant to paragraph 7 shall be held by the Custodian Bank for the employee's account.  An employee shall have the right, upon written request, to have the number of whole shares purchased by such employee issued in the form of a certificate and any fractional shares paid in cash.  If the employee terminates participation in the Plan pursuant to paragraph 14, a stock certificate for the number of whole shares accumulated in the employee(s name will be issued, and the balance at market values will be remitted to the employee in cash, in the manner outlined in paragraph 14 below.

 

9.         Dividends.  Dividends on all shares held for an employee(s account under the Plan shall be reinvested by the Custodian Bank for the employee(s account, in the same manner as remittances are invested pursuant to paragraph 7.

 

10.       Expenses.  The charges of the Custodian Bank, all costs of maintaining records and executing transfers and brokerage expenses incurred in connection with the purchase of shares will be borne by the Company.  Brokerage expenses paid by the Company on purchases of stock under the Plan shall be included as taxable income on a pro rata basis to the employees based on the number of shares (including fractional shares) purchased for the account of each employee during the period for which the expenses are paid.

 

11.       Designation.  Subject to its right to terminate the designation, the Company has designated COMPUTERSHARE as the Custodian Bank hereunder.  The Custodian Bank is the financial agent who is charged with the responsibility of safekeeping of the funds paid in and the shares purchased under the Plan, unless and until the shares are issued to the employees or cash balances refunded.

 

12.       Responsibility.  Neither the Company, the Custodian Bank nor the broker through whom purchase orders are executed shall have any responsibility or liability, other than liabilities arising out of the 1933 and 1934 Securities Acts and applicable state securities laws, for any act or thing done or left undone, including, without limiting the generality of the foregoing, any 

 

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action taken with respect to the price, time, quantity or other conditions and circumstances of the purchase of shares under the terms of the Plan.  A determination by the Company as to any question that may arise regarding the Plan(s conduct or operation shall be final.

 

13.       Limitation on Purchases.  Aggregate purchases under the Plan shall be limited to a total of sixty thousand (60,000) shares per calendar year.  The Company shall monitor the number of shares purchased under the Plan.  If purchases of shares, if made, would exceed the annual limit, the Company shall either amend the Plan to allow for an increased number of shares to be purchased or inform all participants in the Plan that no further payroll deductions or special purchases shall be allowed during that year.  A cessation of purchases pursuant to this paragraph shall not be a discontinuance or termination of the Plan by the Company.

 

14.       Termination.  As promptly as possible after the death or termination of employment of a participating employee, or after the election of a participating employee to terminate participation in the Plan for any reason, all whole shares in such employee(s account will be transferred to such employee(s name or order, or in the event of death, to the name of such employee(s legal representative.  Cash balances not yet remitted by the Company to the Custodian Bank will, in like manner, be refunded as promptly as possible.  Within thirty (30) days following the date the Custodian Bank receives notice of the death or termination of employment of a participating employee or of the election of a participating employee to terminate participation in the Plan, the Custodian Bank shall sell, at the then current
market price, any fractional shares in such an employee(s account, and the proceeds of such transaction shall be promptly paid to the employee or to the employee(s order, in cash.

 

Upon discontinuance of the Plan by the Company, all whole shares in all employees( accounts will be promptly transferred to each employee(s name or order.  Cash balances not yet remitted by the Company to the Custodian Bank will, in like manner, be refunded as promptly as possible.   Within thirty (30) days following the date the Custodian Bank receives notice of the termination of the Plan by the Company, the Custodian Bank shall sell, at the then current market price, all fractional shares in all employees( accounts, and the proceeds of such transaction shall be promptly paid to the employees or to each employee(s order, in cash.

 

15.       Nonalienation.  The right to make purchases under the Plan is personal to the employee and may not be assigned or otherwise transferred by the employee.

 

16.       Jurisdiction.  This Plan shall be governed and construed by and in accordance with the laws of the State of Iowa and the Rules and Regulations of the Securities and Exchange Commission. 

 

 

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