1
EXHIBIT 2(c)
ALLEGHENY POWER SYSTEM, INC.
00000 XXXXXXXXXX XXXX
XXXXXXXXXX, XXXXXXXX 00000
April 5, 1997
DQE, Inc.
000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Ladies and Gentlemen:
With reference to the Agreement and Plan of Merger, dated as
of the date hereof, among DQE, Inc., a Pennsylvania corporation (the "Company"),
Allegheny Power System, Inc., a Maryland corporation ("Parent"), and AYP Sub,
Inc., a Pennsylvania corporation to be formed as a wholly owned subsidiary of
Parent (the "Merger Agreement"), we confirm our agreement (this "Agreement") as
follows:
1. Additional Termination Fee. In the event that the Merger
Agreement is terminated (x) by Parent pursuant to Section 8.4(a) (or 6.2) of the
Merger Agreement or (y) by the Company pursuant to Section 8.3(b)(i) or (iii) of
the Merger Agreement, or (z) by the Company or Parent pursuant to Section 8.2(e)
of the Merger Agreement, then, within two business days following the written
request of the Company, Parent shall pay to the Company by wire transfer of
immediately available funds the amount, if any, by which (1) 0.199 multiplied by
the number of shares of Common Stock, par value $1.25 per share, of Parent
("Parent Common Stock"), outstanding at the close of business on the business
day immediately prior to such termination (such date, the "Determination Date")
multiplied by the average daily closing price of Parent Common Stock on the New
York Stock Exchange (the "NYSE") on the ten NYSE trading days ending on the
Determination Date, as reported in the New York City edition of The Wall Street
Journal, exceeds (2) $719,870,422; provided that the amount payable pursuant to
this Agreement shall not exceed $20,000,000. Parent agrees that if Parent fails
to promptly pay the amount payable pursuant to this Agreement and, in order to
obtain such payment, the Company commences a suit which results in a judgment
against Parent for such payment, Parent shall pay to the Company its costs and
expenses (including attorneys'
2
fees) in connection with such suit, together with interest on the amount of such
payment at the prime rate of Citibank, N.A. in effect on the date such payment
was required to be made.
2. Modification or Amendment. The parties hereto may modify or
amend this Agreement, by written agreement executed and delivered by duly
authorized officers of the respective parties.
3. Assignment. This Agreement shall not be assignable by
operation of law or otherwise, and any purported assignment of this Agreement
shall be null and void.
4. GOVERNING LAW AND VENUE; WAIVER OF JURY TRIAL. THIS
AGREEMENT SHALL BE DEEMED TO BE MADE IN, AND IN ALL RESPECTS SHALL BE
INTERPRETED, CONSTRUED AND GOVERNED BY AND IN ACCORDANCE WITH THE LAW OF, THE
COMMONWEALTH OF PENNSYLVANIA WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES
THEREOF.
5. Counterparts. This Agreement may be executed in any number
of counterparts, each such counterpart being deemed to be an original
instrument, and all such counterparts shall together constitute the same
agreement.
2
3
If you are in agreement with the foregoing, please execute
this Agreement, whereupon this letter shall become a binding agreement between
us.
Very truly yours,
ALLEGHENY POWER SYSTEM, INC.
By: /s/ Xxxx X. Xxxx
-------------------------
Xxxx X. Xxxx
Chairman and Chief
Executive Officer
Accepted and agreed:
DQE, INC.
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------
Xxxxx X. Xxxxxxxx
Chairman and Chief
Executive Officer
3
