EXHIBIT 1.3
TERMS AGREEMENT
February 23, 1994
Arizona Public Service Company
400 North Fifth Street
Phoenix, Arizona 85004
Attention: Treasurer
Dear Madam:
Arizona Public Service Company (the "Company") hereby agrees to
sell to the several Underwriters (the "Underwriters") listed in the
Company's Prospectus Supplement (the "Prospectus Supplement") of even date
herewith relating to $100,000,000 in aggregate principal amount of its First
Mortgage Bonds, therein designated the 6 5/8% Series due 2004 (the
"Purchased Bonds"), and the Underwriters hereby agree to purchase, severally
and not jointly, at a purchase price of 98.881% of the principal amount
thereof plus accrued interest from March 1, 1994 to the Closing Date (as
hereinafter defined), the respective principal amounts of Purchased Bonds
set forth opposite the names of the Underwriters in the Prospectus
Supplement. The sale of the Purchased Bonds by the Company and the purchase
thereof by the Underwriters shall be made on the basis of the
representations, warranties, and agreements contained in the Underwriting
Agreement (the "Underwriting Agreement"), dated August 3, 1993, relating to
the issuance and sale of up to $400,000,000 of the Company's First Mortgage
Bonds under the Company's Indenture, and shall be subject to the terms and
conditions set forth in such Underwriting Agreement. The provisions of the
Underwriting Agreement are incorporated herein by reference. As
contemplated by Section 3 of the Underwriting Agreement, certain terms of
the Purchased Bonds are described in the Prospectus Supplement.
The Underwriters propose to offer the Purchased Bonds to the public
in the manner and upon the terms set out in the Prospectus Supplement.
On March 2, 1994, the Company will deliver the Purchased Bonds to
the Underwriters at the office of BankAmerica National Trust Company, 2
Rector Street, New York, New York 10006, against payment of the purchase
price by transfer of funds by Fed Wire from the Underwriters to the
Company's account at a bank in Phoenix, Arizona designated by the Company.
Such purchase price will be deemed to have been received by the Company upon
the Company's receipt of the Fed Wire reference number relating to such
transfer of funds. On March 3, 1994, the Company will pay to the
Underwriters, by means of transfer of funds by Fed Wire to a bank account
designated by the Underwriters, interest on the purchase price for one day
at the March 2, 1994 Fed Funds Effective Rate. Closing shall occur at the
office of the Company, 400 North Fifth Street, Phoenix, Arizona, at 8:00
a.m. Phoenix time, on March 2, 1994, or at such other time and date as the
Underwriters and the Company may agree upon in writing, such time and date
being referred to as the "Closing Date." All of the Purchased Bonds
referred to in this paragraph will be in definitive and fully registered
form and in such denominations and registered in such names as the
Underwriters request, and will be made available for checking and packaging
at the office of BankAmerica National Trust Company referred to above at
least twenty (20) hours prior to the Closing Date.
If the foregoing is acceptable to you, please sign below and
transmit evidence of such signing to Salomon Brothers Inc at your earliest
convenience. At that point, the agreement signified hereby will constitute
the Terms Agreement, as described in the Underwriting Agreement, with
respect to the $100,000,000 of Purchased Bonds referred to herein.
All capitalized terms herein, not otherwise defined herein, are
used as defined in the Underwriting Agreement. This
agreement may be executed in one or more counterparts, each of which shall
be deemed to be an original, but all such respective counterparts shall
together constitute a single instrument.
Very truly yours,
SALOMON BROTHERS INC
CS FIRST BOSTON CORPORATION
GOLDMAN, SACHS & CO.
(As Representatives of the
Several Underwriters)
By SALOMON BROTHERS INC
By Charlene Jackson
____________________
Vice President
Confirmed and accepted as
of the date first above
written.
ARIZONA PUBLIC SERVICE COMPANY
By Nancy E. Newquist
_________________
Treasurer