ALABAMA POWER CO

(F)FINANCING AND LEASES

Bank Credit Arrangements

See Note 8 to the financial statements under "Bank Credit Arrangements" in Item 8 of the Form 10-K for additional information.

At September 30, 2026, committed credit arrangements with banks were as follows:

(a)Arrangement expiring in 2031 represents a $3.25 billion combined arrangement for Southern Company, Mississippi Power, and Southern Power allowing for flexible sublimits. Pursuant to the combined arrangement, the allocations among Southern Company, Mississippi Power, and Southern Power may be adjusted.

(b)Includes $15 million expiring in 2026 at Alabama Property Company, a wholly-owned subsidiary of Alabama Power, of which $15 million was unused at September 30, 2026. Alabama Power is not party to this arrangement.

(c)Georgia Power had $26 million of letters of credit outstanding under an uncommitted letter of credit facility at September 30, 2026.

(d)Does not include Southern Power Company's $75 million and $100 million continuing letter of credit facilities for standby letters of credit, expiring in 2027 and 2029, respectively, of which $17 million and $4 million, respectively, were unused at September 30, 2026. In addition, Southern Power Company had $23 million of letters of credit outstanding under an uncommitted letter of credit facility at September 30, 2026. Southern Power's subsidiaries are not parties to its bank credit arrangements or letter of credit facilities.

(e)Southern Company Gas, as the parent entity, guarantees the obligations of Southern Company Gas Capital, which is the borrower of $800 million of the credit arrangement expiring in 2031. Southern Company Gas' committed credit arrangement expiring in 2031 also includes $800 million for which Nicor Gas is the borrower and which is restricted for working capital needs of Nicor Gas. Pursuant to the multi-year credit arrangement expiring in 2031, the allocations between Southern Company Gas Capital and Nicor Gas may be adjusted.

As reflected in the table above, in March 2026, (i) Southern Company, Mississippi Power, and Southern Power extended the maturity date of their $3.25 billion combined multi-year credit arrangement from 2030 to 2031, (ii)

Southern Company extended the maturity date of its multi-year credit arrangement from 2027 to 2028, (iii) Georgia Power extended the maturity date of its multi-year credit arrangement from 2030 to 2031, and (iv) Mississippi Power extended the maturity date of its multi-year credit arrangement from 2027 to 2029. In May 2026, Alabama Power and Southern Company Gas Capital, along with Nicor Gas, extended the maturity date of each of their respective multi-year credit arrangements from 2030 to 2031. In May and June 2026, SEGCO amended its credit arrangements to extend the maturity dates from 2026 to 2027.

Subject to applicable market conditions, Southern Company and its subsidiaries expect to renew or replace their bank credit arrangements as needed, prior to expiration. In connection therewith, Southern Company and its subsidiaries may extend the maturity dates and/or increase or decrease the lending commitments thereunder.

These bank credit arrangements, as well as the term loan arrangements of the Registrants, Nicor Gas, and SEGCO, contain covenants that limit debt levels and contain cross-acceleration provisions to other indebtedness (including guarantee obligations) that are restricted only to the indebtedness of the individual company. The cross-acceleration provisions to other indebtedness would trigger an event of default if the applicable borrower defaulted on indebtedness, the payment of which was then accelerated. At September 30, 2026, the Registrants, Nicor Gas, and SEGCO were in compliance with all such covenants. None of the bank credit arrangements contain material adverse change clauses at the time of borrowings.

A portion of the unused credit with banks is allocated to provide liquidity support to certain revenue bonds of the traditional electric operating companies and the commercial paper programs of the Registrants, Nicor Gas, and SEGCO. At September 30, 2026, outstanding variable rate demand revenue bonds of the traditional electric operating companies with allocated liquidity support totaled approximately $1.5 billion (comprised of approximately $796 million at Alabama Power, $653 million at Georgia Power, and $58 million at Mississippi Power). In addition, at September 30, 2026, Georgia Power had approximately $170 million of fixed rate revenue bonds outstanding that are required to be remarketed within the next 12 months. Variable rate demand revenue bonds and fixed rate revenue bonds required to be remarketed within the next 12 months are classified as long-term debt on the balance sheets as a result of available long-term committed credit.

DOE Loan Guarantee Borrowings

On February 20, 2026, pursuant to the loan guarantee program (DOE Loan Guarantee Program) established under Title XVII of the Energy Policy Act of 2005, as amended (Title XVII), Alabama Power entered into (i) a loan guarantee agreement, dated as of February 20, 2026 (Alabama Power LGA), between Alabama Power and the DOE, as guarantor, (ii) a note purchase agreement, dated as of February 20, 2026 (Alabama Power NPA), among Alabama Power, the FFB, and the Secretary of Energy, acting through the DOE, and (iii) future advance promissory notes, each dated February 20, 2026, made by Alabama Power to the FFB (each an Alabama Power FFB Note and, together with the Alabama Power NPA, the Alabama Power FFB Credit Facility Documents). The Alabama Power LGA and the Alabama Power FFB Credit Facility Documents are referred to herein together as the Alabama Power Loan Documents.

In addition, on February 20, 2026, pursuant to the DOE Loan Guarantee Program, Georgia Power entered into (i) a loan guarantee agreement, dated as of February 20, 2026 (Georgia Power LGA and, together with the Alabama Power LGA, the Loan Guarantee Agreements), between Georgia Power and the DOE, as guarantor, (ii) a note purchase agreement, dated as of February 20, 2026 (Georgia Power NPA), among Georgia Power, the FFB, and the Secretary of Energy, acting through the DOE, and (iii) future advance promissory notes, each dated February 20, 2026, made by Georgia Power to the FFB (each a Georgia Power FFB Note and, together with the Georgia Power NPA, the Georgia Power FFB Credit Facility Documents). The Georgia Power LGA and the Georgia Power FFB Credit Facility Documents are referred to herein together as the Georgia Power Loan Documents.

The Alabama Power FFB Credit Facility Documents provide for a multi-advance term loan facility under which Alabama Power may make term loan borrowings through the FFB (Alabama Power Credit Facility). The Georgia Power FFB Credit Facility Documents provide for a multi-advance term loan facility under which Georgia Power may make term loan borrowings through the FFB (Georgia Power Credit Facility and, together with the Alabama

Power Credit Facility, the Credit Facilities). Each of Alabama Power and Georgia Power is referred to herein as a Borrower in connection with its applicable Credit Facility.

Proceeds of advances made under each Credit Facility must be used for the purpose of reimbursing the applicable Borrower for a portion (up to 80%) of "eligible project costs" (as defined in the applicable Loan Guarantee Agreement) incurred by such Borrower for projects that are eligible for financing under the terms of the applicable Loan Guarantee Agreement and the DOE Loan Guarantee Program (Eligible Projects). Eligible Projects may include new gas generating units and upgrades associated with existing gas generating units; new transmission lines, substations, and transmission system upgrades; new stand-alone battery energy storage systems; hydropower refurbishment and upgrades; upgrades, uprates, and license extensions for existing nuclear facilities; coal-to-gas conversions; and grid enhancements.

The aggregate amount of advances under the Alabama Power Credit Facility may not exceed approximately $4.1 billion (Alabama Power Maximum Facility Amount). The aggregate amount of advances under the Georgia Power Credit Facility may not exceed approximately $22.4 billion (Georgia Power Maximum Facility Amount and, together with the Alabama Power Maximum Facility Amount, the Maximum Facility Amounts). Each Borrower may request advances under its applicable Credit Facility during an availability period (with respect to each Borrower, the "availability period") that will continue until the earliest of (i) September 15, 2033, (ii) the date total advances reach the applicable Maximum Facility Amount, or (iii) the termination of the obligation to fund further advances following an event of default under the applicable Loan Guarantee Agreement. In addition, the FFB's obligation to fund advances to Alabama Power will terminate if Alabama Power has failed to request an initial advance by February 20, 2031.

In March 2026, Georgia Power received initial advances under the Georgia Power Credit Facility in an amount of approximately $1.0 billion at an interest rate of 5.041% through the final maturity date of December 10, 2055.

Future advances under each of the Credit Facilities are subject to confirmation of investment grade credit ratings and satisfaction of customary conditions, as well as certification of compliance with the requirements of Title XVII, including accuracy of project-related representation and warranties, delivery of updated project-related information, and evidence of compliance with the prevailing wage requirements of the Davis-Bacon Act of 1931, as amended (DOE Program Requirements), compliance with the Cargo Preference Act of 1954, and certification from the DOE's consulting engineer that proceeds of the advances are used to reimburse for eligible project costs.

All borrowings under each of the Credit Facilities will be full recourse, senior unsecured obligations of the respective Borrower. Alabama Power is not a party to, and has no obligations with respect to, the Georgia Power Credit Facility. Georgia Power is not a party to, and has no obligations with respect to, the Alabama Power Credit Facility.

The final scheduled maturity date for all borrowings under each Credit Facility is December 10, 2055. Each advance will bear interest at a rate equal to the applicable U.S. Treasury rate plus a spread of 0.375%, which rate will be determined at the time of the advance. Principal payments for the Alabama Power Credit Facility are payable in three equal annual installments, beginning on December 10, 2053. Principal payments for the Georgia Power Credit Facility are payable in seven equal annual installments, beginning on December 10, 2049.

Under each of the Loan Guarantee Agreements, the DOE agreed to provide guarantees with respect to the obligations of Alabama Power and Georgia Power under the Alabama Power FFB Credit Facility Documents and Georgia Power FFB Credit Facility Documents, respectively. Under their respective Loan Guarantee Agreements, Alabama Power and Georgia Power are obligated to reimburse the DOE for any amounts the DOE is required to pay with respect to such guarantees. Alabama Power's and Georgia Power's reimbursement obligations to the DOE are full recourse, senior unsecured obligations of the respective Borrower.

Under each Loan Guarantee Agreement, the applicable Borrower is subject to customary affirmative and negative covenants and events of default. In addition, Alabama Power and Georgia Power are subject to project-related reporting requirements and other project-specific covenants and events of default.

Under each Loan Guarantee Agreement, the applicable Borrower will be required to prepay certain amounts outstanding under the applicable Credit Facility if (i) the applicable Borrower takes any action that causes an Eligible Project to cease to be an Eligible Project, (ii) certain "termination events" (as defined in the applicable Loan Guarantee Agreement) occur with respect to any Eligible Project of the applicable Borrower, (iii) eligible project costs recoverable in customer rates of the applicable Borrower are less than 95% of total advances made to the applicable Borrower under the applicable Credit Facility, with such amount tested on the third anniversary of the termination of the applicable availability period, or (iv) the applicable Borrower receives advances for certain preliminary costs and fails to satisfy the DOE Program Requirements. Any mandatory prepayment will be made in quarterly installments and, depending on the size of the required mandatory prepayment, will be payable over a period ofone tothree years (in the case of Alabama Power) orone tofive years (in the case of Georgia Power). Any such mandatory prepayment will be at a prepayment price equal to 100% of the principal amount to be prepaid, plus accrued and unpaid interest to the date of prepayment.

In addition, if a "change of control" (as defined in the applicable Loan Guarantee Agreement) occurs with respect to the applicable Borrower, such Borrower will be required to offer to prepay all outstanding advances under its Credit Facility. Any such prepayment will be made with a make-whole premium or discount, as applicable.

Each Borrower will be permitted to voluntarily prepay all or a portion of any outstanding advances. Any such prepayment will be made with a make-whole premium or discount, as applicable.

Convertible Senior Notes

In August 2026, Southern Company issued approximately $834 million aggregate principal amount of its Series 2026A 2.125% Convertible Senior Notes due December 15, 2027 (Series 2026A Convertible Senior Notes) and approximately $1.898 billion aggregate principal amount of its Series 2026B 3.50% Convertible Senior Notes due September 15, 2029 (Series 2026B Convertible Senior Notes and, together with the Series 2026A Convertible Senior Notes, the 2026 Convertible Senior Notes). Southern Company used a portion of the proceeds from the 2026 Convertible Senior Notes to repurchase approximately $368.7 million of the approximately $829.9 million aggregate principal amount outstanding of its Series 2024A 4.50% Convertible Senior Notes due June 15, 2027. Southern Company evaluated these repurchases and determined that the repurchased notes were accounted for as extinguishment of debt. As a result of these transactions, Southern Company recognized a $33 million loss on extinguishment of debt in the third quarter 2026 within interest expense in the consolidated statements of income.

Interest on the 2026 Convertible Senior Notes is payable semiannually. The Series 2026A Convertible Senior Notes and the Series 2026B Convertible Senior Notes will mature on December 15, 2027 and September 15, 2029, respectively, unless earlier converted or repurchased, but are not redeemable at the option of Southern Company. The 2026 Convertible Senior Notes are direct, unsecured, and unsubordinated obligations of Southern Company, ranking equally with all of Southern Company's other unsecured and unsubordinated indebtedness from time to time outstanding, and are effectively subordinated to all secured indebtedness of Southern Company.

Holders may convert their Series 2026A Convertible Senior Notes and Series 2026B Convertible Senior Notes at their option prior to the close of business on the business day preceding September 15, 2027 and June 15, 2029, respectively, but only under the following circumstances:

•during any calendar quarter (and only during such calendar quarter), if the last reported sale price of Southern Company's common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the applicable conversion price on each applicable trading day as determined by Southern Company;

•during thefive business day period after any 10 consecutive trading day period (Measurement Period) in which the trading price per $1,000 principal amount of the applicable series of the 2026 Convertible Senior Notes for each trading day of the Measurement Period was less than 98% of the product of the last reported sale price of the common stock and the applicable conversion rate on each such trading day; or

•upon the occurrence of certain corporate events.

On or after September 15, 2027 and June 15, 2029, for the Series 2026A Convertible Senior Notes and the Series 2026B Convertible Senior Notes, respectively, a holder may convert all or any portion of its 2026 Convertible Senior Notes at any time prior to the close of business on the second scheduled trading day immediately preceding the applicable maturity date.

Southern Company will settle conversions by paying cash up to the aggregate principal amount of the 2026 Convertible Senior Notes to be converted and paying or delivering, as the case may be, cash, shares of common stock, or a combination of cash and shares of common stock, at Southern Company's election, in respect of the remainder, if any, of Southern Company's conversion obligation in excess of such aggregate principal amount being converted. The Series 2026A Convertible Senior Notes are initially convertible at a rate of 9.5641 shares of common stock per $1,000 principal amount converted, which is approximately equal to $104.56 per share. The Series 2026B Convertible Senior Notes are initially convertible at a rate of 8.4389 shares of common stock per $1,000 principal amount converted, which is approximately equal to $118.50 per share. The conversion rates are subject to adjustment upon certain specified events but will not be adjusted for accrued and unpaid interest. In addition, upon a make-whole fundamental change, Southern Company will, in certain circumstances, increase the applicable conversion rate for conversions in connection with the make-whole fundamental change. Upon a fundamental change, other than an excluded fundamental change, holders may require Southern Company to purchase all or a portion of their 2026 Convertible Senior Notes for cash at 100% of the principal amount plus any accrued and unpaid interest.

Equity Distribution Agreement

See Note 8 to the financial statements under "Equity Distribution Agreement" in Item 8 of the Form 10-K for additional information.

In June 2026, Southern Company established a new at-the-market program and entered into an equity distribution agreement pursuant to which it may sell, from time to time, up to an aggregate of 50 million shares of its common stock, including through initially priced forward sale contracts and collared forward sale contracts (2026 ATM Program). In connection with the establishment of the 2026 ATM Program, Southern Company terminated further sales under its prior at-the-market program established in 2024 (2024 ATM Program).

The table below reflects shares of Southern Company common stock sold and settled under separate initially priced forward sale contracts with forward purchasers during the nine months ended September 30, 2026.

(*)The total number of shares sold under this forward sale contract is 3,130,641, of which 1,070,641 shares were settled during the nine months ended September 30, 2026. The other 2,060,000 shares were settled in December 2025.

As of September 30, 2026, Southern Company had entered into separate forward sale contracts with forward purchasers for a total of 49,885,779 shares of common stock under the 2024 ATM Program, all of which had been sold by the forward sellers, and 7,557,278 shares of common stock under the 2026 ATM Program, all of which had been sold by the forward sellers. Of these shares,40,526,002 were settled during the nine months ended September 30, 2026 in the form of shares at the initial forward price adjusted for interest earned and dividends paid from the forward sale date to the settlement date. The net proceeds from the shares settled during the nine months ended September 30, 2026 were approximately $3.8 billion.

At September 30, 2026, no shares remained subject to future settlement under the forward sale contracts.

Earnings per Share

For Southern Company, the difference in computing basic and diluted EPS is attributable to awards outstanding under stock-based compensation plans, forward sale contracts pursuant to the equity distribution agreement, convertible senior notes, and equity units. EPS dilution resulting from stock-based compensation plans, forward sale contracts, and the equity units is determined using the treasury stock method. EPS dilution resulting from the convertible senior notes is determined using the net share settlement method. See "Equity Distribution Agreement" herein and Note 8 to the financial statements under "Convertible Senior Notes," "Equity Distribution Agreement,"

and "Equity Units" and Note 12 to the financial statements in Item 8 of the Form 10-K for additional information. Shares used to compute diluted EPS were as follows:

For all periods presented, an immaterial number of stock-based compensation awards was excluded from the diluted EPS calculation because the awards were anti-dilutive.

Georgia Power Lease Modification

See Note 9 to the financial statements in Item 8 of the Form 10-K for information on Georgia Power's leases. In June 2026, Georgia Power recognized a lease modification related to an existing affiliate PPA with Southern Power which converted from an operating lease to a finance lease upon its approval by the FERC. As a result, Georgia Power removed from its balance sheet operating lease right-of-use assets, net of amortization of $179 million and lease obligations of $197 million maturing through 2030 and recorded finance lease right-of-use assets of $1.3 billion and lease obligations of $1.3 billion maturing through 2045. See Note (B) under "Georgia Power – Integrated Resource Plans –Certification Requests" for additional information.