Arizona Public Service Company
("Company")
Medium-Term Notes, Series B
Due Nine Months or More from Date of Issue
TERMS AGREEMENT
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April 7, 1997
Arizona Public Service Company
000 Xxxxx 0xx Xxxxxx
Xxxxxxx, XX 00000
Attention: Treasurer
Ladies and Gentlemen:
We offer to purchase, on and subject to the terms and
conditions of the Distribution Agreement filed as an exhibit to the Company's
registration statement on Form S-3 (No. 333-15379) ("Distribution Agreement"),
the following Securities ("Notes") on the following terms:
Title: 6.72% Senior Notes Due 1999
Currency or Currency Units: United States dollars
Stated Maturity: April 1, 1999
Principal Amount: $50,000,000
Public Offering Price: 100%
Original Issue Discount Security: Yes No X
---- -----
Denominations: $1,000 and integral multiples thereof.
Purchase Price (to be paid in immediately available funds):
99.750%, plus accrued interest, if any, from April 10, 1997
Underwriting Discount or Commission received from the
Company (%): .250%
Proceeds to Company (If different from Public Offering Price)
(%): 99.750%
Optional Redemption (option of the Company): As described in
pages S-3 to S-4 of the Prospectus Supplement, dated December
26, 1996 (the "Prospectus Supplement")
Optional Redemption (option of the Holder): None
Sinking Fund: None
Other Terms: None
Trade Date: April 7, 1997
Settlement Date (Issue Date): April 10, 1997
* * * * *
Details for Settlement
----------------------
Exact name in which the Note or Notes are to be
registered ("registered owner"): Cede & Co.
Principal amount of each Note in authorized
denominations to be delivered to registered owner:
$50,000,000
* * * * *
Our agreement to purchase the Notes hereunder is subject to
the conditions set forth in the Distribution Agreement, including the
conditions, and the delivery of the documents, set forth in Section 5 thereof.
If for any reason the purchase by the undersigned of the Notes is not
consummated other than because of a default by the undersigned or a failure to
satisfy a condition set forth in clause (ii), (iii) or (v) of Section 5(c) of
the Distribution Agreement, the Company shall reimburse the undersigned for all
out-of-pocket expenses reasonably incurred by the undersigned in connection with
the offering of the Notes and not otherwise required to be reimbursed pursuant
to Section 4 of the Distribution Agreement.
The Notes will have the terms described in the Prospectus as
supplemented by the Prospectus Supplement dated December 26, 1996 and the
Pricing Supplement No. 1 dated April 7, 1997 (the "Pricing Supplement").
The principal amount of Notes to be purchased by each
Distributor is as specified in the Pricing Supplement. The obligations of the
Distributors to purchase the Notes shall be several and not joint.
Notwithstanding the terms of the Distribution Agreement, the
Company and the Distributors agree that the Company shall prepare the Pricing
Supplement within a reasonable time following the Settlement Date (Issue Date)
for the Senior Notes and, on the date of the filing thereof with the Commission,
to hold the Closing Date specified in Section 3(e) of the Distribution Agreement
at 8:00 A.M., Phoenix time, on such date.
If any Distributor or Distributors default in their
obligations to purchase Notes pursuant to this Terms Agreement and the principal
amount of the Notes that such defaulting Distributor or Distributors agreed but
failed to purchase is ten percent (10%) or less of the principal amount of the
Notes, the Distributors may make arrangements satisfactory to the Company for
the purchase of the Notes by other persons, including any of the Distributors,
but if no such arrangements are made by the Settlement Date (Issue Date) the
nondefaulting Distributors shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Notes that such defaulting
Distributor or Distributors agreed but failed to purchase. If any Distributor or
Distributors so default and the aggregate principal amount of Notes with respect
to which such default or defaults occur is more than the above described amount
and arrangements satisfactory to the remaining Distributors and the Company for
purchase of such Notes by other persons are not made within thirty-six hours
after such default, this
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Terms Agreement will terminate without liability on the part of any
non-defaulting Distributor, except as provided in Section 9 of the Distribution
Agreement. As used in this Terms Agreement, the term "Distributor" includes any
person substituted for a Distributor under this paragraph. Nothing herein will
relieve a defaulting Distributor from liability for its default.
Credit Suisse First Boston Corporation is acting as
representative for the Distributors specified in the Pricing Supplement in
connection with the offering to which this Terms Agreement relates, and any
action under this Terms Agreement taken by Credit Suisse First Boston
Corporation in such capacity will be binding upon the Distributors to which this
Terms Agreement relates.
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This Terms Agreement shall constitute an agreement between the
Company and the undersigned for the sale and purchase of the Notes upon the
terms set forth herein and in the Distribution Agreement.
Very truly yours,
CREDIT SUISSE FIRST BOSTON CORPORATION
SALOMON BROTHERS INC
By: CREDIT SUISSE FIRST BOSTON CORPORATION
By Xxxxxx Xxxxxxx
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Vice President
Accepted and agreed to as of the date set forth above.
ARIZONA PUBLIC SERVICE COMPANY
By Xxxxx X Xxxxxx
---------------------------------
Treasurer
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