Alabama Power Company has entered into an agreement with a group of underwriters led by Lehman Brothers for the issuance of $442 million of senior notes, according to William B. Hutchins, III, Executive Vice President, Chief Financial Officer and Treasurer. The senior notes will be issued in two series as follows:

  *  $275 million - Series N 4.875% Senior Notes due September 1, 2004.
  *  $167 million - Series O Floating Rate Senior Notes due March 3, 2003.

It is expected that both series of senior notes will close on or about August 29, 2001.

Alabama Power, a subsidiary of Atlanta-based Southern Company , provides reliable, affordable electricity to more than 1.3 million customers across the state.

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SOURCE: Alabama Power Company