EXHIBIT 10(j)(5)
 
Mr. John B. Keane
49 Bainbridge Rd
West Hartford, CT 06119

June 14, 2004

Dear Jack,

Per our prior discussions, I’m very interested in having you as a key executive
on the management team at AEP. I would like you to become our Senior Vice
President, General Counsel and Secretary. In this position you would report
directly to me and your office would be located in our corporate headquarters in
Columbus, Ohio. Your start date would be July 1 or earlier if you are available.

As discussed, your salary would initially be $350,000, reviewed annually, and
you would participate in an annual incentive compensation plan with an incentive
target of 50% of your base earnings. Actual annual incentive awards may range
from 0 - 200% of your incentive target and awards are generally paid by the
middle of March after year-end results are confirmed and awards approved.

You would also receive 15,000 AEP restricted stock units upon hire. These would
vest, subject to your continued AEP employment, in one-third increments on the
first through the third anniversary of the grant date.

You would also be eligible to participate in our Long-Term Incentive Plan. This
plan currently provides a mix of stock options and performance shares with the
awards granted toward the end of the year following approval by the Human
Resources Committee of AEP’s Board of Directors.

Should you find this offer acceptable, we would need to continue the employment
process. Melinda Ackerman, our SVP of Human Resources, would need to contact you
to finalize the employment process (application, physical examination and drug
test) and would provide a summary of AEP’s executive benefits, discuss temporary
housing, relocation benefits, etc.

I look forward to hearing from you.

Sincerely,

/s/ Michael G. Morris

Michael G. Morris

C: Melinda S. Ackerman

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Mr. John B. Keane
49 Bainbridge Rd
West Hartford, CT 06119

June 17, 2004

Dear Jack:

In reply to your letter of June 16 and the discussion with Melinda Ackerman, in
addition to the provisions of my employment offer to you dated June 14, we will
provide the following:

1. You will be eligible for a lump-sum severance payment, less applicable tax
withholdings, equal to your annual base salary in effect on the date of your
termination if, for any reason other than cause, the company terminates your
employment with AEP within three years of your date of hire. Such payment would
be conditioned upon your agreement to release AEP from any and all claims
involving your employment with or termination from AEP.

2. As a key AEP executive you will also be eligible for AEP’s Change-in-Control
Agreement. While this agreement is currently being revised due to a recently
passed shareholders’ proposal, a confirmation letter and the document will be
provided upon revision and approval by the Human Resources Committee of the AEP
Board of Directors.

3. In recognition of your prior experience, your cash balance account under the
pension plans shall be credited with an amount such that the total cash credit
under these plans (the AEP Retirement Plan and the AEP Excess Benefit Plan)
shall be the maximum permitted under such plans as amended from time to time
(currently 8.5%) on all eligible earnings. Eligible earnings may not currently
exceed the greater of $1,000,000 or two time your base rate, annually. All other
provisions of the two plans as in effect from time to time shall apply to your
participation therein. The specifics of each of the benefit plans will be
provided and reviewed with you by the Human Resources staff.

I believe this addresses your concerns. However, please feel free to give us a
call should there be additional questions. I look forward to seeing you on July
1.

Sincerely,

/s/ Michael G. Morris

Michael G. Morris

C: Melinda S. Ackerman