Exhibit 1(b)
APPALACHIAN POWER COMPANY
Underwriting Agreement
Dated ____________________
AGREEMENT made between APPALACHIAN POWER COMPANY, a
corporation organized and existing under the laws of the
Commonwealth of Virginia (the "Company"), and the several
persons, firms and corporations (the "Underwriters") named in
Exhibit 1 hereto.
WITNESSETH:
WHEREAS, the Company proposes to issue and sell $__________
principal amount of its [Unsecured Notes] to be issued pursuant
to the Indenture dated as of January 1, 1998, between the Company
and The Bank of New York, as trustee (the "Trustee"), as
heretofore supplemented and amended and as to be further
supplemented and amended (said Indenture as so supplemented being
hereafter referred to as the Indenture); and
WHEREAS, the Underwriters have designated the person signing
this Agreement (the Representative) to execute this Agreement on
behalf of the respective Underwriters and to act for the
respective Underwriters in the manner provided in this Agreement;
and
WHEREAS, the Company has prepared and filed, in accordance
with the provisions of the Securities Act of 1933 (the Act), with
the Securities and Exchange Commission (the Commission), a
registration statement and prospectus or prospectuses relating to
the [Unsecured Notes] and such registration statement has become
effective; and
WHEREAS, such registration statement, as it may have been
amended to the date hereof, including the financial statements,
the documents incorporated or deemed incorporated therein by
reference and the exhibits, being herein called the Registration
Statement, and the prospectus, as included or referred to in the
Registration Statement to become effective, as it may be last
amended or supplemented prior to the effectiveness of the
agreement (the Basic Prospectus), and the Basic Prospectus, as
supplemented by a prospectus supplement which includes certain
information relating to the Underwriters, the principal amount,
price and terms of offering, the interest rate and redemption
prices of the [Unsecured Notes], first filed with the Commission
pursuant to the applicable paragraph of Rule 424(b) of the
Commission's General Rules and Regulations under the Act (the
Rules), including all documents then incorporated or deemed to
have been incorporated therein by reference, being herein call
the Prospectus.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants herein contained, it is agreed between the
parties as follows:
1. Purchase and Sale: Upon the basis of the warranties
and representations and on the terms and subject to the
conditions herein set forth, the Company agrees to sell to the
respective Underwriters named in Exhibit 1 hereto, severally and
not jointly, and the respective Underwriters, severally and not
jointly, agree to purchase from the Company, the respective
principal amounts of the [Unsecured Notes] set opposite their
names in Exhibit 1 hereto, together aggregating all of the
[Unsecured Notes], at a price equal to ______% of the principal
amount thereof.
2. Payment and Delivery: Payment for the [Unsecured
Notes] shall be made to the Company or its order by certified or
bank check or checks, payable in New York Clearing House funds,
at the office of Simpson Thacher & Bartlett, 425 Lexington
Avenue, New York, New York 10017-3909, or at such other place as
the Company and the Representative shall mutually agree in
writing, upon the delivery of the [Unsecured Notes] to the
Representative for the respective accounts of the Underwriters
against receipt therefor signed by the Representative on behalf
of itself and for the other Underwriters. Such payments and
delivery shall be made at 10:00 A.M., New York Time, on
_______________ (or on such later business day, not more than
five business days subsequent to such day, as may be mutually
agreed upon by the Company and the Underwriters), unless
postponed in accordance with the provisions of Section 7 hereof.
The time at which payment and delivery are to be made is herein
called the Time of Purchase.
[The delivery of the [Unsecured Notes] shall be made in
fully registered form, registered in the name of CEDE & CO., to
the offices of The Depository Trust Company in New York, New York
and the Underwriters shall accept such delivery.]
3. Conditions of Underwriters' Obligations: The several
obligations of the Underwriters hereunder are subject to the
accuracy of the warranties and representations on the part of the
Company on the date hereof and at the Time of Purchase and to the
following other conditions:
(a) That all legal proceedings to be taken and all
legal opinions to be rendered in connection with
the issue and sale of the [Unsecured Notes] shall
be satisfactory in form and substance to Dewey
Ballantine LLP, counsel to the Underwriters.
(b) That, at the Time of Purchase, the Representative
shall be furnished with the following opinions,
dated the day of the Time of Purchase, with
conformed copies or signed counterparts thereof
for the other Underwriters, with such changes
therein as may be agreed upon by the Company and
the Representative with the approval of Dewey
Ballantine LLP, counsel to the Underwriters:
(1) Opinion of Simpson Thacher & Bartlett and any
of John F. Di Lorenzo, Jr., Esq., Thomas G.
Berkemeyer, Esq., Ann B. Graf, Esq., David C.
House, Esq., or William E. Johnson, Esq.,
counsel to the Company, substantially in the
forms attached hereto as Exhibits A and B; and
(2) Opinion of Dewey Ballantine LLP, counsel to
the Underwriters, substantially in the form
attached hereto as Exhibit C.
(c) That the Representative shall have received a
letter from Deloitte & Touche LLP in form and
substance satisfactory to the Representative,
dated as of the day of the Time of Purchase, (i)
confirming that they are independent public
accountants within the meaning of the Act and the
applicable published rules and regulations of the
Commission thereunder, (ii) stating that in their
opinion the financial statements audited by them
and included or incorporated by reference in the
Registration Statement complied as to form in all
material respects with the then applicable
accounting requirements of the Commission,
including the applicable published rules and
regulations of the Commission and (iii) covering
as of a date not more than five business days
prior to the day of the Time of Purchase such
other matters as the Representative reasonably
requests.
(d) That no amendment to the Registration Statement
and that no prospectus or prospectus supplement of
the Company relating to the [Unsecured Notes] and
no document which would be deemed incorporated in
the Prospectus by reference filed subsequent to
the date hereof and prior to the Time of Purchase
shall contain material information substantially
different from that contained in the Registration
Statement which is unsatisfactory in substance to
the Representative or unsatisfactory in form to
Dewey Ballantine LLP, counsel to the Underwriters.
(e) That, at the Time of Purchase, appropriate orders
of the Virginia State Corporation Commission and
the Tennessee Regulatory Authority, necessary to
permit the sale of the [Unsecured Notes] to the
Underwriters, shall be in effect; and that, prior
to the Time of Purchase, no stop order with
respect to the effectiveness of the Registration
Statement shall have been issued under the Act by
the Commission or proceedings therefor initiated.
(f) That, at the Time of Purchase, there
shall not have been any material adverse change in
the business, properties or financial condition of
the Company from that set forth in the Prospectus
(other than changes referred to in or contemplated
by the Prospectus), and that the Company shall, at
the Time of Purchase, have delivered to the
Representative a certificate of an executive
officer of the Company to the effect that, to the
best of his knowledge, information and belief,
there has been no such change.
(g) That the Company shall have performed such of its
obligations under this Agreement as are to be
performed at or before the Time of Purchase by the
terms hereof.
4. Certain Covenants of the Company: In further
consideration of the agreements of the Underwriters herein
contained, the Company covenants as follows:
(a) As soon as practicable, and in any event within
the time prescribed by Rule 424 under the Act, to
file any Prospectus Supplement relating to the
[Unsecured Notes] with the Commission; as soon as
the Company is advised thereof, to advise the
Representative and confirm the advice in writing
of any request made by the Commission for
amendments to the Registration Statement or the
Prospectus or for additional information with
respect thereto or of the entry of a stop order
suspending the effectiveness of the Registration
Statement or of the initiation or threat of any
proceedings for that purpose and, if such a stop
order should be entered by the Commission, to make
every reasonable effort to obtain the prompt
lifting or removal thereof.
(b) To deliver to the Underwriters, without charge, as
soon as practicable (and in any event within 24
hours after the date hereof), and from time to
time thereafter during such period of time (not
exceeding nine months) after the date hereof as
they are required by law to deliver a prospectus,
as many copies of the Prospectus (as supplemented
or amended if the Company shall have made any
supplements or amendments thereto) as the
Representative may reasonably request; and in case
any Underwriter is required to deliver a
prospectus after the expiration of nine months
after the date hereof, to furnish to any
Underwriter, upon request, at the expense of such
Underwriter, a reasonable quantity of a
supplemental prospectus or of supplements to the
Prospectus complying with Section 10(a)(3) of the
Act.
(c) To furnish to the Representative a copy, certified
by the Secretary or an Assistant Secretary of the
Company, of the Registration Statement as
initially filed with the Commission and of all
amendments thereto (exclusive of exhibits), and,
upon request, to furnish to the Representative
sufficient plain copies thereof (exclusive of
exhibits) for distribution of one to the other
Underwriters.
(d) For such period of time (not exceeding nine
months) after the date hereof as they are required
by law to deliver a prospectus, if any event shall
have occurred as a result of which it is necessary
to amend or supplement the Prospectus in order to
make the statements therein, in the light of the
circumstances when the Prospectus is delivered to
a purchaser, not contain any untrue statement of a
material fact or not omit to state any material
fact required to be stated therein or necessary in
order to make the statements therein not
misleading, forthwith to prepare and furnish, at
its own expense, to the Underwriters and to
dealers (whose names and addresses are furnished
to the Company by the Representative) to whom
principal amounts of the [Unsecured Notes] may
have been sold by the Representative for the
accounts of the Underwriters and, upon request, to
any other dealers making such request, copies of
such amendments to the Prospectus or supplements
to the Prospectus.
(e) As soon as practicable, the Company will make
generally available to its security holders and to
the Underwriters an earnings statement or
statement of the Company and its subsidiaries
which will satisfy the provisions of Section 11(a)
of the Act and Rule 158 under the Act.
(f) To use its best efforts to qualify the [Unsecured
Notes] for offer and sale under the securities or
"blue sky" laws of such jurisdictions as the
Representative may designate within six months
after the date hereof and itself to pay, or to
reimburse the Underwriters and their counsel for,
reasonable filing fees and expenses in connection
therewith in an amount not exceeding $3,500 in the
aggregate (including filing fees and expenses paid
and incurred prior to the effective date hereof),
provided, however, that the Company shall not be
required to qualify as a foreign corporation or to
file a consent to service of process or to file
annual reports or to comply with any other
requirements deemed by the Company to be unduly
burdensome.
(g) To pay all expenses, fees and taxes (other than
transfer taxes on resales of the [Unsecured Notes]
by the respective Underwriters) in connection with
the issuance and delivery of the [Unsecured
Notes], except that the Company shall be required
to pay the fees and disbursements (other than
disbursements referred to in paragraph (f) of this
Section 4) of Dewey Ballantine LLP, counsel to the
Underwriters, only in the events provided in
paragraph (h) of this Section 4, the Underwriters
hereby agreeing to pay such fees and disbursements
in any other event.
(h) If the Underwriters shall not take up and pay for
the [Unsecured Notes] due to the failure of the
Company to comply with any of the conditions
specified in Section 3 hereof, or, if this
Agreement shall be terminated in accordance with
the provisions of Section 7 or 8 hereof, to pay
the fees and disbursements of Dewey Ballantine
LLP, counsel to the Underwriters, and, if the
Underwriters shall not take up and pay for the
[Unsecured Notes] due to the failure of the
Company to comply with any of the conditions
specified in Section 3 hereof, to reimburse the
Underwriters for their reasonable out-of-pocket
expenses, in an aggregate amount not exceeding a
total of $10,000, incurred in connection with the
financing contemplated by this Agreement.
(i) The Company will timely file any certificate
required by Rule 52 under the Public Utility
Holding Company Act of 1935 in connection with the
sale of the [Unsecured Notes].
[(j) The Company will use its best efforts to list,
subject to notice of issuance, the [Unsecured
Notes] on the New York Stock Exchange.]
[(k) During the period from the date hereof and
continuing to and including the earlier of (i) the
date which is after the Time of Purchase on which
the distribution of the [Unsecured Notes] ceases,
as determined by the Representative in its sole
discretion, and (ii) the date which is 30 days
after the Time of Purchase, the Company agrees not
to offer, sell, contract to sell or otherwise
dispose of any [Unsecured Notes] of the Company or
any substantially similar securities of the
Company without the consent of the Representative.]
5. Warranties of and Indemnity by the Company: The
Company represents and warrants to, and agrees with you, as set
forth below:
(a) the Registration Statement on its effective date
complied, or was deemed to comply, with the
applicable provisions of the Act and the rules and
regulations of the Commission and the Registration
Statement at its effective date did not, and at
the Time of Purchase will not, contain any untrue
statement of a material fact or omit to state a
material fact required to be stated therein or
necessary to make the statements therein not
misleading, and the Basic Prospectus at the time
that the Registration Statement became effective,
and the Prospectus when first filed in accordance
with Rule 424(b) complies, and at the Time of
Purchase the Prospectus will comply, with the
applicable provisions of the Act and the Trust
Indenture Act of 1939, as amended, and the rules
and regulations of the Commission, the Basic
Prospectus at the time that the Registration
Statement became effective, and the Prospectus
when first filed in accordance with Rule 424(b)
did not, and the Prospectus at the Time of
Purchase will not, contain any untrue statement of
a material fact or omit to state a material fact
required to be stated therein or necessary to make
the statements therein, in the light of the
circumstances under which they were made, not
misleading, except that the Company makes no
warranty or representation to the Underwriters
with respect to any statements or omissions made
in the Registration Statement or Prospectus in
reliance upon and in conformity with information
furnished in writing to the Company by, or through
the Representative on behalf of, any Underwriter
expressly for use in the Registration Statement,
the Basic Prospectus or Prospectus, or to any
statements in or omissions from that part of the
Registration Statement that shall constitute the
Statement of Eligibility under the Trust Indenture
Act of 1939 of any indenture trustee under an
indenture of the Company.
(b) As of the Time of Purchase, the Indenture will
have been duly authorized by the Company and duly
qualified under the Trust Indenture Act of 1939,
as amended, and, when executed and delivered by
the Trustee and the Company, will constitute a
legal, valid and binding instrument enforceable
against the Company in accordance with its terms
and such [Unsecured Notes] will have been duly
authorized, executed, authenticated and, when paid
for by the purchasers thereof, will constitute
legal, valid and binding obligations of the
Company entitled to the benefits of the Indenture,
except as the enforceability thereof may be
limited by bankruptcy, insolvency, or other
similar laws affecting the enforcement of
creditors' rights in general, and except as the
availability of the remedy of specific performance
is subject to general principles of equity
(regardless of whether such remedy is sought in a
proceeding in equity or at law), and by an implied
covenant of good faith and fair dealing.
(c) To the extent permitted by law, to indemnify and
hold you harmless and each person, if any, who
controls you within the meaning of Section 15 of
the Act, against any and all losses, claims,
damages or liabilities, joint or several, to which
you, they or any of you or them may become subject
under the Act or otherwise, and to reimburse you
and such controlling person or persons, if any,
for any legal or other expenses incurred by you or
them in connection with defending any action,
insofar as such losses, claims, damages,
liabilities or actions arise out of or are based
upon any alleged untrue statement or untrue
statement of a material fact contained in the
Registration Statement, in the Basic Prospectus,
or in the Prospectus, or if the Company shall
furnish or cause to be furnished to you any
amendments or any supplemental information, in the
Prospectus as so amended or supplemented other
than amendments or supplements relating solely to
securities other than the Notes (provided that if
such Prospectus or such Prospectus, as amended or
supplemented, is used after the period of time
referred to in Section 4(b) hereof, it shall
contain such amendments or supplements as the
Company deems necessary to comply with Section
10(a) of the Act), or arise out of or are based
upon any alleged omission or omission to state
therein a material fact required to be stated
therein or necessary to make the statements
therein not misleading, except insofar as such
losses, claims, damages, liabilities or actions
arise out of or are based upon any such alleged
untrue statement or omission, or untrue statement
or omission which was made in the Registration
Statement, in the Basic Prospectus or in the
Prospectus, or in the Prospectus as so amended or
supplemented, in reliance upon and in conformity
with information furnished in writing to the
Company by or through you expressly for use
therein or with any statements in or omissions
from that part of the Registration Statement that
shall constitute the Statement of Eligibility
under the Trust Indenture Act, of any indenture
trustee under an indenture of the Company, and
except that this indemnity shall not inure to your
benefit (or of any person controlling you) on
account of any losses, claims, damages,
liabilities or actions arising from the sale of
the Notes to any person if such loss arises from
the fact that a copy of the Prospectus, as the
same may then be supplemented or amended to the
extent such Prospectus was provided to you by the
Company (excluding, however, any document then
incorporated or deemed incorporated therein by
reference), was not sent or given by you to such
person with or prior to the written confirmation
of the sale involved and the alleged omission or
alleged untrue statement or omission or untrue
statement was corrected in the Prospectus as
supplemented or amended at the time of such
confirmation, and such Prospectus, as amended or
supplemented, was timely delivered to you by the
Company. You agree promptly after the receipt by
you of written notice of the commencement of any
action in respect to which indemnity from the
Company on account of its agreement contained in
this Section 5(c) may be sought by you, or by any
person controlling you, to notify the Company in
writing of the commencement thereof, but your
omission so to notify the Company of any such
action shall not release the Company from any
liability which it may have to you or to such
controlling person otherwise than on account of
the indemnity agreement contained in this Section
8(a). In case any such action shall be brought
against you or any such person controlling you and
you shall notify the Company of the commencement
thereof, as above provided, the Company shall be
entitled to participate in, and, to the extent
that it shall wish, including the selection of
counsel (such counsel to be reasonably acceptable
to the indemnified party), to direct the defense
thereof at its own expense. In case the Company
elects to direct such defense and select such
counsel (hereinafter, "Company's counsel"), you or
any controlling person shall have the right to
employ your own counsel, but, in any such case,
the fees and expenses of such counsel shall be at
your expense unless (i) the Company has agreed in
writing to pay such fees and expenses or (ii) the
named parties to any such action (including any
impleaded parties) include both you or any
controlling person and the Company and you or any
controlling person shall have been advised by your
counsel that a conflict of interest between the
Company and you or any controlling person may
arise (and the Company's counsel shall have
concurred in good faith with such advice) and for
this reason it is not desirable for the Company's
counsel to represent both the indemnifying party
and the indemnified party (it being understood,
however, that the Company shall not, in connection
with any one such action or separate but
substantially similar or related actions in the
same jurisdiction arising out of the same general
allegations or circumstances, be liable for the
reasonable fees and expenses of more than one
separate firm of attorneys for you or any
controlling person (plus any local counsel
retained by you or any controlling person in their
reasonable judgment), which firm (or firms) shall
be designated in writing by you or any controlling
person). No indemnifying party shall, without the
prior written consent of the indemnified parties,
settle or compromise or consent to the entry of
any judgment with respect to any litigation, or
any investigation or proceeding by any
governmental agency or body, commenced or
threatened, or any claim whatsoever in respect of
which indemnification could be sought under this
Section 5 (whether or not the indemnified parties
are actual or potential parties thereto), unless
such settlement, compromise or consent (i)
includes an unconditional release of each
indemnified party from all liability arising out
of such litigation, investigation, proceeding or
claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
In no event shall any indemnifying party have any
liability or responsibility in respect of the
settlement or compromise of, or consent to the
entry of any judgment with respect to, any pending
or threatened action or claim effected without its
prior written consent.
(d) The documents incorporated by reference in the
Registration Statement or Prospectus, when they
were filed with the Commission, complied in all
material respects with the applicable provisions
of the 1934 Act and the rules and regulations of
the Commission thereunder, and as of such time of
filing, when read together with the Prospectus,
none of such documents contained an untrue
statement of a material fact or omitted to state a
material fact required to be stated therein or
necessary to make the statements therein, in the
light of the circumstances under which they were
made, not misleading.
(e) Since the respective dates as of which information
is given in the Registration Statement and the
Prospectus, except as otherwise stated therein,
there has been no material adverse change in the
business, properties or financial condition of the
Company.
(f) This Agreement has been duly authorized, executed
and delivered by the Company.
(g) The consummation by the Company of the
transactions contemplated herein will not conflict
with, or result in a breach of any of the terms or
provisions of, or constitute a default under, or
result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets
of the Company under any contract, indenture,
mortgage, loan agreement, note, lease or other
agreement or instrument to which the Company is a
party or by which it may be bound or to which any
of its properties may be subject (except for
conflicts, breaches or defaults which would not,
individually or in the aggregate, be materially
adverse to the Company or materially adverse to
the transactions contemplated by this Agreement.)
(h) No authorization, approval, consent or order of
any court or governmental authority or agency is
necessary in connection with the issuance and sale
by the Company of the Notes or the transactions by
the Company contemplated in this Agreement, except
(A) such as may be required under the 1933 Act or
the rules and regulations thereunder; (B) such as
may be required under the Public Utility Holding
Company Act of 1935, as amended (the "1935 Act");
(C) the qualification of the Indenture under the
1939 Act; (D) the approval of The Indiana Utility
Regulatory Commission; and (E) such consents,
approvals, authorizations, registrations or
qualifications as may be required under state
securities or Blue Sky laws.
The Company's indemnity agreement contained in Section 5(c)
hereof, and its covenants, warranties and representations
contained in this Agreement, shall remain in full force and
effect regardless of any investigation made by or on behalf of
any person, and shall survive the delivery of and payment for the
[Unsecured Notes] hereunder.
6. Warranties of and Indemnity by Underwriters:
(a) Each Underwriter warrants and represents that the
information furnished in writing to the Company
through the Representative for use in the
Registration Statement, in the Basic Prospectus,
in the Prospectus, or in the Prospectus as amended
or supplemented is correct as to such Underwriter.
(b) Each Underwriter agrees, to the extent permitted
by law, to indemnify, hold harmless and reimburse
the Company, its directors and such of its
officers as shall have signed the Registration
Statement, and each person, if any, who controls
the Company within the meaning of Section 15 of
the Act, to the same extent and upon the same
terms as the indemnity agreement of the Company
set forth in Section 5(c) hereof, but only with
respect to untrue statements or alleged untrue
statements or omissions or alleged omissions made
in the Registration Statement, or in the Basic
Prospectus, or in the Prospectus, or in the
Prospectus as so amended or supplemented, in
reliance upon and in conformity with information
furnished in writing to the Company by the
Representative on behalf of such Underwriter
expressly for use therein. The Company agrees
promptly after the receipt by it of written notice
of the commencement of any action in respect to
which indemnity from you on account of your
agreement contained in this Section 6(b) may be
sought by the Company, or by any person
controlling the Company, to notify you in writing
of the commencement thereof, but the Company's
omission so to notify you of any such action shall
not release you from any liability which you may
have to the Company or to such controlling person
otherwise than on account of the indemnity
agreement contained in this Section 6(b).
The indemnity agreement on the part of each Underwriter
contained in Section 6(b) hereof, and the warranties and
representations of such Underwriter contained in this Agreement,
shall remain in full force and effect regardless of any
investigation made by or on behalf of the Company or other
person, and shall survive the delivery of and payment for the
[Unsecured Notes] hereunder.
7. Default of Underwriters: If any Underwriter under this
Agreement shall fail or refuse (otherwise than for some reason
sufficient to justify, in accordance with the terms hereof, the
cancellation or termination of its obligations hereunder) to
purchase and pay for the principal amount of [Unsecured Notes]
which it has agreed to purchase and pay for hereunder, and the
aggregate principal amount of [Unsecured Notes] which such
defaulting Underwriter or Underwriters agreed but failed or
refused to purchase is not more than one-tenth of the aggregate
principal amount of the [Unsecured Notes], the other Underwriters
shall be obligated severally in the proportions which the amounts
of [Unsecured Notes] set forth opposite their names in Exhibit 1
hereto bear to the aggregate principal amount of [Unsecured
Notes] set forth opposite the names of all such non-defaulting
Underwriters, to purchase the [Unsecured Notes] which such
defaulting Underwriter or Underwriters agreed but failed or
refused to purchase on the terms set forth herein; provided that
in no event shall the principal amount of [Unsecured Notes] which
any Underwriter has agreed to purchase pursuant to Section 1
hereof be increased pursuant to this Section 7 by an amount in
excess of one-ninth of such principal amount of [Unsecured Notes]
without the written consent of such Underwriter. If any
Underwriter or Underwriters shall fail or refuse to purchase
[Unsecured Notes] and the aggregate principal amount of
[Unsecured Notes] with respect to which such default occurs is
more than one-tenth of the aggregate principal amount of the
[Unsecured Notes] then this Agreement shall terminate without
liability on the part of any defaulting Underwriter; provided,
however, that the non-defaulting Underwriters may agree, in their
sole discretion, to purchase the [Unsecured Notes] which such
defaulting Underwriter or Underwriters agreed but failed or
refused to purchase on the terms set forth herein. In the event
the Company shall be entitled to but shall not elect (within the
time period specified above) to exercise its rights under clause
(a) and/or (b), then this Agreement shall terminate. In the
event of any such termination, the Company shall not be under any
liability to any Underwriter (except to the extent, if any,
provided in Section 4(h) hereof), nor shall any Underwriter
(other than an Underwriter who shall have failed or refused to
purchase the [Unsecured Notes] without some reason sufficient to
justify, in accordance with the terms hereof, its termination of
its obligations hereunder) be under any liability to the Company
or any other Underwriter.
Nothing herein contained shall release any defaulting
Underwriter from its liability to the Company or any
non-defaulting Underwriter for damages occasioned by its default
hereunder.
8. Termination of Agreement by the Underwriters: This
Agreement may be terminated at any time prior to the Time of
Purchase by the Representative if, after the execution and
delivery of this Agreement and prior to the Time of Purchase, in
the Representative's reasonable judgment, the Underwriters'
ability to market the [Unsecured Notes] shall have been
materially adversely affected because:
(i) trading in securities on the New York Stock
Exchange shall have been generally suspended by the
Commission or by the New York Stock Exchange, or
(ii) (A) a war involving the United States of America
shall have been declared, (B) any other national calamity
shall have occurred, or (C) any conflict involving the armed
services of the United States of America shall have
escalated, or
(iii) a general banking moratorium shall have been
declared by Federal or New York State authorities, or
(iv) there shall have been any decrease in the ratings
of the Company's first mortgage bonds by Moody's Investors
Services, Inc. (Moody's) or Standard & Poor's Ratings Group
(S&P) or either Moody's or S&P shall publicly announce that
it has such first mortgage bonds under consideration for
possible downgrade.
If the Representative elects to terminate this
Agreement, as provided in this Section 8, the Representative will
promptly notify the Company by telephone or by telex or facsimile
transmission, confirmed in writing. If this Agreement shall not
be carried out by any Underwriter for any reason permitted
hereunder, or if the sale of the [Unsecured Notes] to the
Underwriters as herein contemplated shall not be carried out
because the Company is not able to comply with the terms hereof,
the Company shall not be under any obligation under this
Agreement and shall not be liable to any Underwriter or to any
member of any selling group for the loss of anticipated profits
from the transactions contemplated by this Agreement (except that
the Company shall remain liable to the extent provided in Section
4(h) hereof) and the Underwriters shall be under no liability to
the Company nor be under any liability under this Agreement to
one another.
9. Notices: All notices hereunder shall, unless otherwise
expressly provided, be in writing and be delivered at or mailed
to the following addresses or by telex or facsimile transmission
confirmed in writing to the following addresses: if to the
Underwriters, to
_______________________________________________________________,
as Representative, _____________________________________________,
and, if to the Company, to Appalachian Power Company, c/o
American Electric Power Service Corporation, 1 Riverside Plaza,
Columbus, Ohio 43215, attention of A. A. Pena, Treasurer, (fax
614/223-1687).
10. Parties in Interest: The agreement herein set forth
has been and is made solely for the benefit of the Underwriters,
the Company (including the directors thereof and such of the
officers thereof as shall have signed the Registration
Statement), the controlling persons, if any, referred to in
Sections 5 and 6 hereof, and their respective successors,
assigns, executors and administrators, and, except as expressly
otherwise provided in Section 7 hereof, no other person shall
acquire or have any right under or by the virtue of this
Agreement.
11. Definition of Certain Terms: If there be two or more
persons, firms or corporations named in Exhibit 1 hereto, the
term "Underwriters", as used herein, shall be deemed to mean the
several persons, firms or corporations, so named (including the
Representative herein mentioned, if so named) and any party or
parties substituted pursuant to Section 7 hereof, and the term
"Representative", as used herein, shall be deemed to mean the
representative or representatives designated by, or in the manner
authorized by, the Underwriters. All obligations of the
Underwriters hereunder are several and not joint. If there shall
be only one person, firm or corporation named in Exhibit 1
hereto, the term "Underwriters" and the term "Representative", as
used herein, shall mean such person, firm or corporation. The
term "successors" as used in this Agreement shall not include any
purchaser, as such purchaser, of any of the [Unsecured Notes]
from any of the respective Underwriters.
12. Conditions of the Company's Obligations: The
obligations of the Company hereunder are subject to the
Underwriters' performance of their obligations hereunder, and the
further condition that at the Time of Purchase the Virginia State
Corporation Commission and the Tennessee Regulatory Authority
shall have issued appropriate orders, and such orders shall
remain in full force and effect, authorizing the transactions
contemplated hereby.
13. Applicable Law: This Agreement will be governed and
construed in accordance with the laws of the State of New York.
14. Execution of Counterparts: This Agreement may be
executed in several counterparts, each of which shall be regarded
as an original and all of which shall constitute one and the same
document.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto
duly authorized, on the date first above written.
APPALACHIAN POWER COMPANY
By:____________________________
A. A. Pena
Treasurer
___________________________________
as Representative
and on behalf of the Underwriters
named in Exhibit 1 hereto
By:____________________________
EXHIBIT 1
Name Principal Amount