EXHIBIT 4(c)
May 5, 2003
Company Order and Officers' Certificate
3.60% Senior Notes, Series G, due 2008
5.95% Senior Notes, Series H, due 2033
The Bank of New York, as Trustee
101 Barclay Street
New York, New York 10286
Ladies and Gentlemen:
Pursuant to Article Two of the Indenture, dated as of January 1, 1998 (as it may
be amended or supplemented, the "Indenture"), from Appalachian Power Company
(the "Company") to The Bank of New York, as trustee (the "Trustee"), and the
Board Resolutions dated January 23, 2003, a copy of which certified by the
Secretary or an Assistant Secretary of the Company is being delivered herewith
under Section 2.01 of the Indenture, and unless otherwise provided in a
subsequent Company Order pursuant to Section 2.04 of the Indenture,
1. the Company's 3.60% Senior Notes, Series G, due 2008 (the
"Series G Notes") and 5.95% Senior Notes, Series H, due 2033
(the "Series H Notes") are hereby established. The Series G
Notes and the Series H Notes are collectively referred to
herein as the "Notes"). The Notes shall be in substantially
the forms attached hereto as Exhibits 1 and 2.
2. the terms and characteristics of the Notes shall be as
follows (the numbered clauses set forth below corresponding to
the numbered subsections of Section 2.01 of the Indenture,
with terms used and not defined herein having the meanings
specified in the Indenture):
(i) the aggregate principal amount of Notes which may be
authenticated and delivered under the Indenture shall be
limited to $200,000,000 for the Series G Notes and
$200,000,000 for the Series H Notes, except as contemplated in
Section 2.01(i) of the Indenture;
(ii) the date on which the principal of the Series G Notes
shall be payable shall be May 15, 2008 and the date on which
the principal of the Series H Notes shall be payable shall be
May 15, 2033;
(iii) interest shall accrue from the date of authentication of
the Notes; the Interest Payment Dates on which such interest
will be payable shall be May 15 and November 15, and the
Regular Record Date for the determination of holders to whom
interest is payable on any such Interest Payment Date shall be
the April 30 or October 31 preceding the relevant Interest
Payment Date; provided that the first Interest Payment Date
shall be November 15, 2003 and interest payable on the Stated
Maturity Date or any Redemption Date shall be paid to the
Person to whom principal shall be paid;
(iv) the interest rate at which the Series G Notes shall bear
interest shall be 3.60% per annum and the interest rate at
which the Series H Notes shall bear interest shall be 5.95%
per annum;
(v) the Notes shall be redeemable at the option of the
Company, in whole at any time or in part from time to time,
upon not less than thirty but not more than sixty days'
previous notice given by mail to the registered owners of the
Notes at a redemption price equal to the greater of (i) 100%
of the principal amount of the Notes being redeemed and (ii)
the sum of the present values of the remaining scheduled
payments of principal and interest on the Notes being redeemed
(excluding the portion of any such interest accrued to the
date of redemption) discounted (for purposes of determining
present value) to the redemption date on a semi-annual basis
(assuming a 360-day year consisting of twelve 30-day months)
at the Treasury Rate (as defined below) plus 15 basis points
for the Series G Notes and 25 basis points for the Series H
Notes, plus, in each case, accrued interest thereon to the
date of redemption.
"Treasury Rate" means, with respect to any redemption date,
the rate per annum equal to the semi-annual equivalent yield
to maturity of the Comparable Treasury Issue, assuming a price
for the Comparable Treasury Issue (expressed as a percentage
of its principal amount) equal to the Comparable Treasury
Price for such redemption date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as
having a maturity comparable to the remaining term of the
Notes that would be utilized, at the time of selection and in
accordance with customary financial practice, in pricing new
issues of corporate debt securities of comparable maturity to
the remaining term of the Notes.
"Comparable Treasury Price" means, with respect to any
redemption date, (i) the average of the bid and asked prices
for the Comparable Treasury Issue (expressed in each case a
percentage of its principal amount) on the third Business Day
preceding such redemption date, as set forth in the daily
statistical release (or any successor release) published by
the Federal Reserve Bank of New York and designated "Composite
3:30 p.m. Quotations for U. S. Government Securities" or (ii)
if such release (or any successor release) is not published or
does not contain such prices on such third Business Day, the
Reference Treasury Dealer Quotation for such redemption date.
"Independent Investment Banker" means one of the Reference
Treasury Dealers appointed by the Company and reasonably
acceptable to the Trustee.
"Reference Treasury Dealer" means a primary U.S. government
securities dealer in New York City selected by the Company and
reasonably acceptable to the Trustee.
"Reference Treasury Dealer Quotation" means, with respect to
the Reference Treasury Dealer and any redemption date, the
average, as determined by the Trustee, of the bid and asked
prices for the Comparable Treasury Issue (expressed in each
case as a percentage of its principal amount) quoted in
writing to the Trustee by such Reference Treasury Dealer at or
before 5:00 p.m., New York City time, on the third Business
Day preceding such redemption date.
(vi) (a) the Notes shall be issued in the form of a Global
Note; (b) the Depositary for such Global Note shall be The
Depository Trust Company; and (c) the procedures with respect
to transfer and exchange of Global Notes shall be as set forth
in the form of Note attached hereto;
(vii) the title of the Series G Notes shall be "3.60% Senior
Notes, Series G, due 2008" and the title of the Series H Notes
shall be "5.95% Senior Notes, Series H, due 2033";
(viii) the form of the Notes shall be as set forth in
Paragraph 1, above;
(ix) not applicable;
(x) the Notes shall not be subject to a Periodic Offering;
(xi) not applicable;
(xii) not applicable;
(xiii) not applicable;
(xiv) the Notes shall be issuable in denominations of $1,000
and any integral multiple thereof;
(xv) not applicable;
(xvi) the Notes shall not be issued as Discount Securities;
(xvii) not applicable;
(xviii) not applicable; and
(xix) So long as any of the Notes are outstanding, the Company
will not create or suffer to be created or to exist any
additional mortgage, pledge, security interest, or other lien
(collectively "Liens") on any of its utility properties or
tangible assets now owned or hereafter acquired to secure any
indebtedness for borrowed money ("Secured Debt"), without
providing that the Notes will be similarly secured. This
restriction does not apply to the Company's subsidiaries, nor
will it prevent any of them from creating or permitting to
exist Liens on their property or assets to secure any Secured
Debt. Further, this restriction on Secured Debt does not apply
to the Company's existing first mortgage bonds that have
previously been issued under its Indenture, dated December 1,
1940, between the Company and Bankers Trust Company and R.
Gregory Page, as Trustees or any indenture supplemental
thereto; provided that this restriction will apply to future
issuances thereunder (other than issuances of refunding first
mortgage bonds). In addition, this restriction does not
prevent the creation or existence of:
(a) Liens on property existing at the time of
acquisition or construction of such property (or created
within one year after completion of such acquisition or
construction), whether by purchase, merger, construction or
otherwise, or to secure the payment of all or any part of the
purchase price or construction cost thereof, including the
extension of any Liens to repairs, renewals, replacements,
substitutions, betterments, additions, extensions and
improvements then or thereafter made on the property subject
thereto;
(b) Financing of the Company's accounts receivable
for electric service;
(c) Any extensions, renewals or replacements (or
successive extensions, renewals or replacements), in whole or
in part, of liens permitted by the foregoing clauses; and
(d) The pledge of any bonds or other securities at
any time issued under any of the Secured Debt permitted by the
above clauses.
In addition to the permitted issuances above, Secured Debt not
otherwise so permitted may be issued in an amount that does
not exceed 15% of Net Tangible Assets as defined below.
"Net Tangible Assets" means the total of all assets (including
revaluations thereof as a result of commercial appraisals,
price level restatement or otherwise) appearing on the
Company's balance sheet, net of applicable reserves and
deductions, but excluding goodwill, trade names, trademarks,
patents, unamortized debt discount and all other like
intangible assets (which term shall not be construed to
include such revaluations), less the aggregate of the
Company's current liabilities appearing on such balance sheet.
For purposes of this definition, the Company's balance sheet
does not include assets and liabilities of its subsidiaries.
This restriction also does not apply to or prevent the
creation or existence of leases made, or existing on property
acquired, in the ordinary course of business.
3. You are hereby requested to authenticate $200,000,000
aggregate principal amount of 3.60% Senior Notes, Series G,
due 2008 and $200,000,000 aggregate principal amount of 5.95%
Senior Notes, Series H, due 2033, executed by the Company and
delivered to you concurrently with this Company Order and
Officers' Certificate, in the manner provided by the
Indenture.
4. You are hereby requested to hold the Notes as custodian for
DTC in accordance with the Letter of Representations dated May
1, 2003, from the Company and the Trustee to DTC.
5. Concurrently with this Company Order and Officers'
Certificate, an Opinion of Counsel under Sections 2.04 and
13.06 of the Indenture is being delivered to you.
6. The undersigned Geoffrey S. Chatas and Thomas G.
Berkemeyer, the Treasurer and Assistant Secretary,
respectively, of the Company do hereby certify that:
(i) we have read the relevant portions of the Indenture,
including without limitation the conditions precedent provided
for therein relating to the action proposed to be taken by the
Trustee as requested in this Company Order and Officers'
Certificate, and the definitions in the Indenture relating
thereto;
(ii) we have read the Board Resolutions of the Company and the
Opinion of Counsel referred to above;
(iii) we have conferred with other officers of the Company,
have examined such records of the Company and have made such
other investigation as we deemed relevant for purposes of this
certificate;
(iv) in our opinion, we have made such examination or
investigation as is necessary to enable us to express an
informed opinion as to whether or not such conditions have
been complied with; and
(v) on the basis of the foregoing, we are of the opinion that
all conditions precedent provided for in the Indenture
relating to the action proposed to be taken by the Trustee as
requested herein have been complied with.
Kindly acknowledge receipt of this Company Order and Officers' Certificate,
including the documents listed herein, and confirm the arrangements set forth
herein by signing and returning the copy of this document attached hereto.
Very truly yours,
APPALACHIAN POWER COMPANY
By: /s/ Geoffrey S. Chatas
Treasurer
And:/s/ Thomas G. Berkemeyer
Assistant Secretary
Acknowledged by Trustee:
By: /s/ Joseph A. Lloret
Authorized Signatory