Document:

ex10-3.htm

    
      

      

    

     

    Exhibit 10.3

    

    This
Joint Ownership Agreement has been filed to provide investors with information
regarding its terms.  It is not intended to provide any other factual
information about the Tennessee Valley Authority.  The representations
and warranties of the parties in this Joint Ownership Agreement were made to,
and solely for the benefit of, the other party to this Joint Ownership
Agreement.  The assertions embodied in the representations and
warranties may be qualified by information included in schedules, exhibits, or
other materials exchanged by the parties that may modify or create exceptions to
the representations and warranties.  Accordingly, investors should not
rely on the representations and warranties as characterizations of the actual
state of facts at the time they were made or otherwise.

    

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    

    TVA
Contract No.  00069956

    

    

    

    

    

    JOINT
OWNERSHIP AGREEMENT

    

    Dated as
of April 30, 2008

    

    

    between

    

    SEVEN
STATES POWER CORPORATION

    

    and

    

    TENNESSEE
VALLEY AUTHORITY

    

    Southaven
Power Plant

    An 810
MWe (nominal) Gas-Fired Combined Cycle Electric Generating Facility

    Located
in DeSoto County, Mississippi

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    JOINT
OWNERSHIP AGREEMENT

    This JOINT OWNERSHIP AGREEMENT, dated
as of April 30, 2008 (Agreement), is entered into by and between SEVEN STATES
POWER CORPORATION (Seven States), a not-for-profit mutual benefit corporation
created and existing under the Laws of the State of Tennessee, and TENNESSEE
VALLEY AUTHORITY (TVA), a corporate agency and instrumentality of the United
States Government created and existing under and by virtue of the Tennessee
Valley Authority Act of 1933, as amended, 16 U.S.C.
§§ 831-831ee (2000 & Supp. V 2005).

    

    W I T N E S S E T
H:

    WHEREAS, TVA generates and transmits
electric power and energy to Distributors, who resell that power and energy to
consumers in portions of seven states in and around the Tennessee River Valley
watershed; and

    WHEREAS, through the Tennessee Valley
Public Power Association (TVPPA), substantially all of the Distributors formed
Seven States for various purposes, among which is obtaining ownership interests
in generating facilities jointly with TVA; and

    WHEREAS, under the TVA Strategic Plan,
TVA is seeking to provide the opportunity for Distributors to participate in
shared generation ownership, as long as (i) Long-Term Arrangements for such
shared ownership do not have a negative impact on average cost of service and
(ii) Distributor ownership under such Long-Term Arrangements correspondingly
reduces TVA’s total financial obligations; and

     

     

    
      
        
        

      

      
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    WHEREAS, Seven States and TVA desire to
develop mutually acceptable contractual arrangements to permit TVA and the
Distributors who are members of Seven States to jointly own generating
facilities with TVA; and

    WHEREAS, TVA is in the process of
acquiring Southaven Power Plant, an 810 MWe (nominal) gas-fired
combined cycle electric generating facility located in DeSoto County,
Mississippi and associated real property and rights (Generating Facility);
and

    WHEREAS, TVA has negotiated
arrangements with the Generating Facility’s seller, Southaven Power, LLC
(Seller), a special purpose subsidiary of Cogentrix Energy, Inc., under which
TVA may take title to the Generating Facility and related real property,
personal property, and other rights (collectively the Purchased Assets), subject
to an option by Seven States to acquire an undivided, joint interest therein,
pursuant to an Amended and Restated Asset Purchase Agreement, dated as of March
31, 2008, by and between Seller and TVA (the Purchase Agreement);
and

    WHEREAS, the Parties desire to enter
into this Agreement to facilitate the acquisition and initial financing of the
Purchased Assets while Long-Term arrangements for the joint ownership,
operation, and maintenance of the Purchased Assets are being developed;
and

    WHEREAS, the Parties also desire to
provide for the related Lease Agreement attached hereto as Exhibit A (Lease), to
be executed and delivered in conjunction with an exercise by Seven States of the
option provided for under of Section 3, below; and

    WHEREAS,
the Parties are attempting to reach agreement as soon as possible on Long-Term
Arrangements that would replace and supersede this Agreement and the related
Lease and that would produce mutual benefits for Seven States and the TVA power
system; and

     

     

    
      
        
        

      

      
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    WHEREAS,
it is recognized that the mutual benefit of Distributor ownership
correspondingly reducing TVA’s total financial obligations will not be achieved
by this Agreement and the related Lease but that it is a critical element that
will be of the essence of any Long-Term Arrangements; and

    WHEREAS, it is further recognized that
if Seven States exercises the option provided for under Section 3, below, but
thereafter agreement on such Long-Term Arrangements is not reached, TVA will
under the circumstances and terms set forth in this Agreement and in the Lease,
reacquire any Elected Percentage;

    NOW, THEREFORE, for and in
consideration of the premises, the mutual covenants and agreements contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Parties agree as follows:

    1.  Definitions.  Capitalized
terms used in this Agreement, including the foregoing recitals, and not
otherwise defined herein shall have the respective meanings set forth in this
Section.

    “Accumulated Amortization Costs” means
an amount equal to the sum of all Monthly Amortization Costs paid to date by TVA
under the Lease.

    “Agreement” means this Joint Ownership
Agreement.

    “Assignment Agreements” means contracts
between TVA and Seller under which Seller agrees to assign to TVA, and TVA
agrees to assume, certain contracts relating to ownership of the Purchased
Assets (including interconnection agreements, warranties, and service contracts)
and under which TVA has contractual rights to exercise certain option rights on
behalf of Seven States or assign interests therein to Seven States, as described
in Section 3(b), below.

     

     

    
      
        
        

      

      
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    “Borrowing Cost Rate” means the amount
calculated monthly by the following formula:

     

    BCR=12*MBC/(EP*(PP+TCCRC+TCCM)-AAC)

     

    where BCR
means Borrowing Cost Rate

    MBC means
Monthly Borrowing Costs,

    EP means
Elected Percentage,

    PP means
Purchase Price

    TCCRC
means total costs to date of Capitalized Replacement Components,

    TCCM
means total costs to date of Capitalized Modifications, and

    AAC means
Accumulated Amortization Costs.

     

    “Business Day” means any day
except:  Saturday, Sunday, a weekday that TVA observes as a Federal
holiday, or a weekday on which banking institutions in New York City are
authorized or required by Law to be closed.  Federal holidays that TVA
observes include New Year's Day, Martin Luther King’s Birthday, Presidents’ Day,
Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans’ Day,
Thanksgiving Day, and Christmas Day.  If a payment or notice
obligation otherwise falls due on other than a Business Day, it shall be due on
the next Business Day thereafter.

    “Buy-Back Closing” means TVA’s and
Seven States’ closing on the repurchase by TVA of all of Seven States’ right,
title, and interest in and to the Purchased Assets pursuant to Section 5(e)
below.

    “Buy-Back Option” means the options
described in Section 5 below to cause the repurchase by TVA of all of Seven
States’ right, title, and interest in and to the Purchased Assets.

     

     

    
      
        
        

      

      
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    “Buy-Back Period” means that period of
time that begins on the date of this Agreement and that ends twenty-four (24)
calendar months from the date of this Agreement.  If this Agreement
terminates under Section 2, below, before twenty-four (24) months from the date
of this Agreement, however, the Buy-Back Period shall terminate upon termination
of this Agreement.

    “Buy-Back Price” means an amount equal
to (i) the Seven States Purchase Price; plus (ii) all amounts paid by Seven
States to TVA for Capitalized Replacement Components and Capitalized
Modifications under Sections 7.2 and 8.4 of the Lease; plus (iii) any and all
amounts due and unpaid from TVA to Seven States under the Lease Agreement on the
date of Buy-Back Closing; minus (iv) Accumulated Amortization
Costs.  Except to the extent anticipated profit or transaction costs
may be covered by the amounts provided for under (iii) above, the Buy-Back Price
shall not include any anticipated profit or transaction costs, including legal,
accounting, mortgage and investment banking, corporate advisory, consulting, and
other fees and costs associated with the initial development, organization,
governance, and operation of Seven States.  Furthermore, the Parties
acknowledge and agree that the Buy-Back Price is calculated as stated above in
this definition without regard to the market value or operating condition of the
Purchased Assets at the time of the Buy-Back Closing.

    “Capitalized Modification” means any
Modification (either a Required Modification or an Optional Modification) that
costs one hundred thousand dollars 

     

     

    
      
        
        

      

      
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    ($100,000)
or more, the cost responsibility for which shall be borne by TVA and Seven
States in proportion to their percentage ownership interests in the Purchased
Assets, as  specified in Section 8.4 of the Lease.

    “Capitalized Replacement Components”
means any Replacement Components that TVA installs on the Leased Premises
through a project that costs one hundred thousand dollars ($100,000) or more,
the cost responsibility for which shall be borne by TVA and Seven States in
proportion to their percentage ownership interests in the Purchased Assets,
as  specified in Section 7.2(b) of the Lease.

    “Commercially Reasonable” means such
efforts, actions, or terms as a reasonably prudent business would undertake or
agree to for the protection of its own interests under the relevant conditions,
including the amount of notice needed, the competitive environment, and the risk
to the Parties.

    “Confidential Information” has the
meaning specified in Section 22 (Confidentiality), below.

    “Designated Entity” means one of the
following entities, as designated by Seven States pursuant to Section 3(b)
(Seven States Obtaining an Ownership Interest):

    (i) Seven
States, or

    (ii)
another entity that is either:

    (A) wholly owned or wholly controlled
by Seven States, or

    (B) wholly owned or wholly controlled
by:  (1) members of Seven States, or (2) a combination of Seven States
and members of Seven States, or (3) a combination of members of Seven States and
an entity wholly owned or wholly controlled by Seven States;

    provided, however, that any
such entity under this part (ii) shall be subject to approval by TVA and shall
agree to an assignment to such entity of all of the rights and obligations of
Seven States under this Agreement.

    “Distributor” means a wholesale power
customer of TVA (either a cooperative or a municipality) that resells TVA power
to the Distributor’s retail customers.

     

    
      
        
        

      

      
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    “Documentation” means any and all
books, records, documents, drawings, reports, data, designs, policies,
procedures, and safety, operations, instruction, and maintenance manuals
exclusively or materially relating to the Purchased Assets, including any
(i) environmental logs, data sheets, studies, reports, and records,
including correspondence received by or sent to Governmental Authorities,
hazardous waste disposal records, and chemical inventories; (ii) permit
records and files, and emergency, accident, incident, safety, and inspection
reports and records that are not covered by the attorney-client privilege;
(iii) operating, maintenance, and repair logs, data sheets, reports, and
records; (iv) vendor lists and vendor purchase orders and records;
(v) engineering design and construction drawings and plans, including
as-built drawings; (vi) blueprints; (vii) specifications;
(viii) records, plans, deeds, reports, and drawings relating to the real
property comprising the Purchased Assets’ site; (ix) drawings in AutoCAD or
similar programs, OEM manuals, and the rights to use and duplicate the
foregoing.

    “Elected Percentage” has the meaning
specified in Section 3(b) (Seven States Obtaining an Ownership Interest),
below.

    “Exhibit A” refers to the draft Lease
attached to this Agreement.

    “Good Utility Practice” means any of
the practices, methods, and acts engaged in or approved, as the same may change
from time to time, by a significant portion of the electric utility industry
during the relevant time period, or practices, methods, and acts that, in the
exercise of reasonable judgment in light of the facts known at the time the
decision was made, could have been expected to accomplish the desired result at
a reasonable cost consistent with good business practices, reliability, safety,
and expedition.  Good Utility Practice is not intended to be limited
to any particular set of optimum practices, methods, or acts to the exclusion of
all 

     

    
      
        
        

      

      
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    others,
but rather is intended to encompass a broad spectrum of acceptable practices,
methods, and acts.

    “Governmental Authority” means any
Federal, state, local, foreign, or other governmental subdivision, regulatory or
administrative agency, commission, body, court, tribunal, or other authority
exercising or entitled to exercise any administrative, executive, judicial,
legislative, police, regulatory, taxing, or other authority or power over the
particular matters specified in the relevant section of this
Agreement.

    “Law” means all statutes, rules,
regulations, ordinances, codes, treaties, orders, judgments, decrees, and
similar action of any Governmental Authority, including the applicable common
law and environmental laws.

    “Lease” means the separate Lease
Agreement, substantially in the form of Exhibit A attached hereto, to be
executed and delivered at a Seven States Closing in conjunction with an exercise
by Seven States of the option provided for under Section 3, below, under which
TVA would lease back Seven States’ ownership interest in the Purchased Assets so
that TVA may, among other things, provide fuel for, operate, maintain, dispatch,
and sell the output of the Purchased Assets.  For purposes of applying
the provisions of this Agreement after the separate Lease Agreement has been
executed, “Lease” shall be deemed to refer to said agreement as executed and as
it may be supplemented or amended by the further written agreement of the
Parties.

    “Lender” means one or more financial
institutions or investment bankers that provide credit facilities to Seven
States to finance the acquisition of its ownership interest in the Purchased
Assets.

     

     

    
      
        
        

      

      
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    “Long-Term Arrangements” means joint
ownership arrangements between Seven States and TVA for the Purchased Assets in
connection with the long-term arrangements for Seven States’ ownership of
generating facilities, addressing issues including joint ownership, operation,
maintenance, fueling, power generation, dispatch, power sales, and rate impacts
of the Purchased Assets.

    “Modification” means a modification,
alteration, betterment, addition, enlargement, or improvement to the Purchased
Assets that represents a change to the original specifications, installation,
design, equipment, equipment capacity, or control schemes as delineated by plant
drawings, prints, and original equipment design specifications, including any
Required Modifications, Optional Modifications, and Capitalized
Modifications.

    “Monthly Amortization Costs” means an
amount equal to the product of the Elected Percentage multiplied by the sum of
the Purchase Price plus the total costs to date of Capitalized Replacement
Components plus the total costs to date of Capitalized Modifications, which sum
is then divided by three hundred (300), which may be expressed by the following
formula:

    MAC=EP*(PP+TCCRC+TCCM)/300

    where MAC
means Monthly Amortization Costs,

    EP means
Elected Percentage,

    PP means
Purchase Price,

    TCCRC
means total costs to date of Capitalized Replacement Components,
and

    TCCM
means total costs to date of Capitalized Modifications.

     

    “Monthly Borrowing Costs” means an
amount equal to the most recent available month’s actual monthly interest costs
and fees charged by Lenders to Seven States for Seven States’ loans

     

     

    
      
        
        

      

      
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    and
credit facilities associated with the Purchased Assets, including any
Capitalized Modifications and Capitalized Replacement Components.

               “Optional
Modification” has the meaning specified in Section 8.2 of the
Lease.

               “Party”
means Seven States or TVA, and “Parties” means, collectively, TVA and Seven
States.

    “Person” means any natural person,
corporation, cooperative, partnership, limited liability company, joint venture,
joint-stock company, firm, association, trust, unincorporated organization,
government or political subdivision thereof, governmental agency, or any other
entity, whether acting in an individual, fiduciary, or other
capacity.

    “Purchase Agreement” means the March
31, 2008, Amended and Restated Asset Purchase Agreement between TVA and Seller
as described in Section 3 (Seven States Obtaining an Ownership Interest), below,
which includes rights for Seven States to obtain a joint ownership interest in
the Purchased Assets pursuant to Section 12.5 of the Purchase
Agreement.

    “Purchase Price” means the total amount
paid by TVA to Seller under Sections 3.2, 3.3, 3.4, 3.5, and 6.25 of the
Purchase Agreement, which total amount consists of the sum of:  (i)
the four hundred and sixty-one million and three hundred thousand dollars
($461,300,000.00) base purchase price under Section 3.2 of the Purchase
Agreement, plus (ii) the five million dollars ($5,000,000.00) O&M
termination agreement reimbursement under Section 6.25 of the Purchase
Agreement, plus (iii) the net effect of all adjustments, if any, (both at
closing and post closing) under Sections 3.3 and 3.5 of the Purchase Agreement,
plus (iv) the net effect of all prorations, if any, under Section 3.4 of the
Purchase Agreement.

    “Purchased Assets” has the meaning
specified in the Purchase Agreement.

     

     

    
      
        
        

      

      
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    “Replacement Component” has the meaning
specified in Section 7.2(a) of the Lease.“Required Modification” has the meaning
specified in Section 8.1 of the Lease.“Seller” means Southaven Power, LLC, a
special purpose subsidiary of Cogentrix Energy, Inc.

    “Seven States” means Seven States Power
Corporation, as described in the first paragraph of this
Agreement.  It is recognized that pursuant to Section 3, below, Seven
States is permitted to designate a Designated Entity to take title to the Leased
Premises.  In such event, the references to Seven States in this
Agreement shall be deemed to refer to the Designated Entity as required by the
context.

    “Seven States Closing” means the
closing provided for in Section 3(b) below, at which a Designated Entity would
obtain title to an Elected Percentage of the Purchased Assets.

    “Seven States Option Exercise Period”
means the one (1) -year period specified in Section 3(b), below, during which
Seven States may exercise the option for a Designated Entity to obtain title to
an Elected Percentage.

    “Seven States Purchase Price” means an
amount equal to the product of the Elected Percentage multiplied by the Purchase
Price.

    “TVA” means the Tennessee Valley
Authority, as described in the first paragraph of this Agreement.

    “TVA Act” means the Tennessee Valley
Authority Act of 1933, as
amended, 16 U.S.C. §§ 831-831ee (2000 & Supp. V
2005).

    “TVPPA” means the Tennessee Valley
Public Power Association.

     

     

    
      
        
        

      

      
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    2.  Term of
Agreement.  This Agreement shall become effective as of April
30, 2008 (Effective Date).  Unless terminated earlier by an agreement
on Long-Term Arrangements, this Agreement shall continue in effect until the
earlier of:

    (a) the end of the Seven States
Option Exercise Period if Seven States has not exercised the option provided for
in Section 3 by such date;

    (b) the date as of which a Seven
States Closing is scheduled to occur under this Agreement if said closing does
not occur by such date;

    (c) the exercise of, and the
consummation of, any Buy-Back Option under Sections 5(a), 5(b), or 5(d) below
prior to the end of the Buy-Back Period, or

    (d) the consummation of the
Buy-Back Option under Section 5(c) below, at the end of the Buy-Back
Period.

    It is
expressly recognized that if the Lease becomes effective due to a Seven States
Closing, it shall not terminate prior to the termination of this Agreement under
(c) or (d) above.

    3.  Seven
States Obtaining an Ownership Interest.  (a)  It is
recognized that TVA’s binding and definitive agreement with Seller to purchase
the Purchased Assets includes the following:

    (i) a Purchase Agreement, under which
TVA is entitled to purchase the Purchased Assets and under which TVA has
contractual rights to exercise certain option rights on behalf of Seven States,
as described in Section 3(b), below; and

    (ii) Assignment
Agreements.

    3(b)  It is recognized that,
at Seven States’ direction, TVA has informed Seller that TVA elected under the
Purchase Agreement and under the Assignment Agreements for Seller to grant to
TVA and to Seven States the necessary rights and obligations so that, upon TVA’s

     

     

    
      
        
        

      

      
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    and
Seller’s closing of the acquisition of the Purchased Assets, TVA owns a one
hundred percent (100%) ownership share in the Purchased Assets, and Seven States
holds an option to require TVA to convey to the Designated Entity an undivided
ownership share of at least fifty percent (50%) but no more than ninety percent
(90%) (the Elected Percentage).  Seven States’ exercise of such option
shall be effected by a notice to TVA specifying the Elected Percentage and
designating the Designated Entity in accordance with Section 19 (Notice and
Communication) at any time up to but no more than one (1) year after closing of
the transfer of ownership interests in the Purchased Assets by the Seller to
TVA.  If Seven States exercises such option:

    (i) the Lease shall be executed
and delivered at the time of or before the Seven States Closing,
and

    (ii) the Parties shall conduct a
Seven States Closing at which:

    (A) Seven States shall pay to TVA via
wire transfer consistent with Exhibit B a sum equal to the Elected Percentage of
the Purchase Price; and

    (B) TVA shall convey rights, title, and
interest (including, to the fullest extent legally permissible, transfer,
assignment, or other conveyance of any and all relevant contracts, warranties,
permits, licenses, and other approvals of Governmental Authorities) to the
Elected Percentage of the Purchased Assets to the Designated
Entity.  The ownership interests of the Parties shall be joint and
undivided, and shall not be subject to partition.

    3(c)
Further, it is recognized that TVA, Seven States and the Lenders have been
discussing methods to secure Seven States'  obligations upon the exercise
of any Buy Back Option to convey to TVA full title to the Purchased
Assets, including any Modifications and
Replacement Components, and to repay the Lenders in full all
amounts owing under Seven 

     

     

    
      
        
        

      

      
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    States’
loans and credit facilities for the Purchased Assets, including any Capitalized
Modification and Capitalized Replacement Component, and that they will continue
such discussions regarding appropriate ways to so secure such obligations. 
Accordingly, to the extent that TVA, Seven States and the Lenders reach
agreement in such discussions, any real estate mortgages, other security
instruments and agreements to be provided at the Seven States Closing in
connection with securing such obligations shall be provided for by a written
agreement supplementing and amending this Agreement.

    3(d)  It is expressly
recognized that at the Seven States Closing or thereafter, this Agreement and
the related Lease may be replaced by Long-Term Arrangements that have been
agreed to by the Parties and that the Parties are endeavoring to put such
Long-Term Arrangements in place as soon as possible; provided, however, that
nothing in this Agreement shall be construed to obligate either Party to enter
into such Long-Term Arrangements.

    4.  Inspection
and Audit Rights.  The Parties recognize that under the
Purchase Agreement Seven States and its officers, employees, legal counsel,
accountants, financial advisors, consultants, and any agents and representatives
of current or prospective lenders and underwriters, subject to the
confidentiality requirements of Section 22 (Confidentiality), below, have
reasonable access during normal business hours, upon reasonable notice, and to
the maximum extent provided by Law (including antitrust Laws), to the Purchased
Assets’ and Seller’s relevant books, records, and other material information
reasonably related to the Purchased Assets and their operations (including
financial and operational records) to the same extent that TVA has such
access.  Further, TVA agrees that during the Seven States Option
Exercise Period, Seven States and its officers, employees, legal counsel,
accountants, financial advisors, consultants, and any agents and representatives
of current or prospective Lenders and 

     

     

    
      
        
        

      

      
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    underwriters,
subject to the confidentiality requirements of Section 22 (Confidentiality),
below, shall have reasonable access during normal business hours, upon
reasonable notice, and to the maximum extent provided by Law (including
antitrust Laws), to TVA’s relevant books, records, and other material
information reasonably related to the Purchased Assets and their operations
(including financial and operational records).

    5.  Buy-Back.  (a)  At
any time during the Buy-Back Period, Seven States may exercise a Buy-Back
Option, for any reason, by written notice to TVA’s notice recipient who is
designated pursuant to Section 19 (Notice and Communication),
below.

    5(b)  At any time during the
Buy-Back Period, TVA may exercise a Buy-Back Option, by written notice to Seven
States’ notice recipient who is designated pursuant to Section 19 (Notice and
Communication), below, if one or more of the following events has
occurred:

    (i) Seven States’ Borrowing Cost
Rate exceeds five percent (5%); or

    (ii) If TVA determines, in its sole
discretion, that changes in long-term debt markets are expected to negatively
impact the economics of this Agreement or the Lease for the TVA system such
that, in TVA’s sole judgment, the arrangements provided for in this Agreement or
the Lease are no longer economically viable for TVA; or

    (iii) An event giving rise under
the Lease to a TVA right to exercise a Buy-Back Option; or

    (iv) Seven States
either:  (A) becomes bankrupt or insolvent (however evidenced),
becomes subject to receivership, or otherwise makes an assignment or any general
arrangements for the benefit of creditors; or (B) files a petition or otherwise
commences, authorizes, or acquiesces in the commencement of a proceeding or case
under any 

     

     

    
      
        
        

      

      
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    bankruptcy
or similar Laws for the protection of creditors, or such a petition is filed
against it; or (C) is unable to pay its debts as they fall due; or

    (v) Seven States incurs any debt
in excess of $100,000 in addition to:

    (A) any non-delinquent property taxes;
and

    (B) its obligations to Lenders for
loans extended by Lenders for Seven States’ Elected Percentage of:

    (I) the Purchase Price,
and

    (II) Capitalized Replacement
Components, and

    (III) Capitalized
Modifications.

    5(c) If a Buy-Back Option has not been
exercised under Sections 5(a) or 5(b) above by the end of the Buy-Back Period, a
notice under Section 5(a) above shall automatically be deemed to have been given
by Seven States on the last day of the Buy-Back Period.

    5(d)  Each Lender is intended
as a third-party beneficiary of the provisions of this
Section 5.  Accordingly, at any time during the Buy-Back Period,
in accordance with rights and procedures set forth in Seven States’ loans and
credit facilities for the Purchased Assets, the Lenders may exercise a Buy-Back
Option, for any reason set forth in Sections 5(a) or 5(b), above, by written
notice to TVA’s notice recipient and the Seven States notice recipient
designated pursuant to Section 19 (Notice and Communication) which notice shall
reference the provision of the Seven States’ loans and credit facilities giving
rise to the Lenders’ right to exercise the Buy-Back Option.  Further,
it is expressly recognized and agreed that:

    (i) Seven States may assign to
Lenders its rights to receive payments under a Buy-Back Option or under the
Lease or both; and

     

     

    
      
        
        

      

      
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    (ii) Each Lender shall have the
right to enforce the provisions of this Section 5 by instituting all necessary
actions at law or suits in equity, including suits for specific
performance.

    5(e)  Within a reasonable
time, but not to exceed thirty (30) days after a Buy-Back Option is exercised
under 5(a), 5(b), or 5(d) above, or is deemed to have been exercised under 5(c)
above, Seven States shall sell and TVA shall buy all of Seven States’ rights,
title, and interest (including transfer, assignment, or other conveyance of any
and all relevant contracts, warranties, permits, licenses, and other approvals
of Governmental Authorities) in the Purchased Assets at the Buy-Back
Price.  Seven States shall deliver the appropriate instruments and
other documents to effect such transfer, assignment, or other conveyance to TVA
upon TVA’s payment of the Buy-Back Price.

    6.  Acknowledgement
of Obligations.  TVA acknowledges that Seven States will, on
the date of the Seven States Closing, assign to Lenders Seven States’ rights to
receive payments under the Lease and under the Buy-Back Option, and that Seven
States will grant Lenders the authority to exercise the Buy Back
Option.  TVA hereby acknowledges that once Seven States effects such
assignments, if TVA exercises a Buy-Back Option, TVA will pay the Buy-Back Price
(in accordance with the terms of this Agreement and in accordance with the terms
of such assignment) on Seven States’ behalf to the Lenders on the date of the
Buy-Back Closing upon TVA’s receipt of the appropriate instruments and other
documents that effect the transfer, assignment, or other conveyance to TVA of
all of Seven States’ or its successor-in-interest’s right, title, and interest
in the Purchased Assets.

    7.  Additional
Approvals.  TVA and Seven States shall obtain all required
corporate, member, and Governmental Authority approvals necessary or appropriate
for each of them to 

     

     

    
      
        
        

      

      
        –17–

        
          

        

      

      
        
        

      

    

     

    acquire
their respective ownership interests in the Purchased Assets and to perform
other necessary or appropriate actions under this Agreement.

    8.  No Waiver
of Default.  Any waiver at any time by either Party hereto of
its rights with respect to any default of the other Party or with respect to any
other matter arising in connection with this Agreement shall not be considered a
waiver with respect to any subsequent or continuing default or
matter.

    9.  No
Cross-Default.  Except as expressly provided herein, a default
by either Party under this Agreement shall not constitute a default by that same
Party under any other agreement, nor shall a default by either Party under any
other agreement constitute a default by that same Party under this
Agreement.

    10.  Survival
of Obligations.  Termination of this Agreement shall not
relieve the Parties of obligations that by their nature should survive such
termination, including payment, warranty, remedy, indemnity, and confidentiality
obligations.

    11.  Billing
and Payment.  If either Party exercises a Buy-Back Option,
Seven States shall submit in electronic form an invoice to TVA for the Buy-Back
Price.  For accounting reference purposes, the invoice shall be
numbered and dated and shall include (a) the TVA contract number assigned under
Section 12 (Contract Number), below, and (b) reasonably sufficient detail or
supporting documentation to permit TVA to verify the appropriateness or accuracy
of the amount owed.  Any invoices submitted hereunder shall further
include the following certification signed by a corporate officer of Seven
States:

     

    “Seven
States certifies that, to the best of its knowledge and belief, all information
contained in this invoice is true and correct, that all charges and expenditures
reported herein were made and incurred in accordance with the provisions of this
Agreement and have been actually incurred by Seven States, and that payment
therefor has not been received from TVA or otherwise paid or reimbursed to Seven
States by any other party.”

     

     

    
      
        
        

      

      
        –18–

        
          

        

      

      
        
        

      

    

     

    TVA shall
pay Seven States at the Buy Back Closing as instructed in connection with the
closing.  TVA shall include the above-described contract number with
such payment for accounting reference purposes.

    12.  Contract
Number.  TVA has assigned to this Agreement the contract number
shown on the cover page of this Agreement, above, for both Parties to use as a
reference in the invoicing and payment processes.

    13.  Payment
Dispute.  TVA may dispute in good faith the payment of all or
any portion of the Buy-Back Price if TVA has a reasonable basis to demonstrate
that such amount is inappropriate or questionable.  In that case, TVA
shall promptly advise Seven States in writing of the reasons for disputing all
or a portion of the invoiced amount.  Upon receipt of TVA’s written
statement of reasons, the dispute resolution provisions of Section 18 (Dispute
Resolution), below, shall apply.

    14.  No
Offset.  Neither Party shall offset any amount owed to the
other Party under this Agreement against any amount owed by the other Party
under any other agreement.

    15.  Limitation
of Warranties and Limitation of Liability.  When title to all
or a portion of the Purchased Assets is transferred by one Party to the other
Party pursuant to Section 3(b) (Seven States Obtaining an Ownership Interest) or
Section 5 (Exercise of Buy-Back Option), above, no additional warranty rights in
addition to those under the Purchase Agreement accrue under this
Agreement.  The transferor expressly disclaims any other warranties,
including implied warranties of merchantability or fitness for any particular
use or purpose.

    16.  Force
Majeure.  Any delays in or failure of performance (except for
the obligation to pay money) by a Party or its contractors shall not constitute
default hereunder if and to the extent such delays or failures of performance
are caused by occurrences beyond the reasonable 

     

     

    
      
        
        

      

      
        –19–

        
          

        

      

      
        
        

      

    

     

    control
of that Party or its contractors, and that Party shall not be liable for any
loss or damage due to or arising out of any such delays or failure of
performance.  Such occurrences include acts of God or the public
enemy, fires, epidemics, quarantines, strikes, freight embargoes or delays in
transportation, unforeseeable severe weather or floods, or regulations, orders,
or other acts or failures to act of Governmental Authorities, or any causes,
whether or not of the same class or kind of those specifically above named, that
are not within the control of that Party or its contractors.

    17.  Audit
Rights and Retention of Records.  Seven States shall keep
accurate records and books of accounts in machine-readable form supporting the
items and costs billed under this Agreement.  Upon TVA’s written
request, Seven States shall provide reasonable access at any time during normal
working hours, without restrictions and at no additional cost, to its records as
necessary to permit TVA to verify the accuracy or appropriateness of the
invoice.  TVA shall keep the information examined confidential in
accordance with Section 22 (Confidentiality), below.  If a billing
dispute is submitted to dispute resolution as set out in Section 18 (Dispute
Resolution), below, Seven States agrees to provide the pertinent records or
information to counsel and independent experts of TVA and those attempting to
resolve the dispute, provided that such third parties agree to keep such records
or information confidential.  Nothing in this Section 17 shall be
construed as in any way impairing the ability, pursuant to statutory authority,
of the Office of the Inspector General of TVA or of any other Federal agency
having auditing jurisdiction over TVA, to examine the records of Seven States to
the extent relating to any amount billed to TVA by Seven States.  Any
payments by TVA to Seven States that are not in accordance with this Agreement’s
terms or are not supported by valid evidence shall be refunded to
TVA.  Seven States shall preserve and make available its records, both
manual and those that 

     

     

    
      
        
        

      

      
        –20–

        
          

        

      

      
        
        

      

    

     

    are in
machine-readable form, for a period of three (3) years from the date of final
payment by TVA.

    18.  Dispute
Resolution.  If a dispute arises out of or relates to this
Agreement, the Parties agree to use their best efforts to resolve such a dispute
informally at the lowest possible levels of decision-making.  If such
a dispute is not resolved at the working level, it shall be referred to higher
levels of management of both Parties for consideration, as
necessary.  If the dispute cannot be so settled within sixty (60)
days, the Parties will consider the development and use of consensual
alternative dispute resolution processes (ADR), such as facilitation and
mediation, to try in good faith to settle the dispute before resorting to
litigation.  It is expressly recognized and agreed, however, that (a)
nothing in this Section 18 shall be construed to require the use or completion
of ADR prior to resorting to litigation or to otherwise limit the Parties from
resorting to litigation and (b) this Section 18 is not a “Disputes” clause
within the meaning of the Contract Disputes Act of 1978, 41 U.S.C. §§ 601-613
(CDA), and that this Agreement is not subject to the provisions of the
CDA.

    19.  Notice
and Communications.  Unless any section of this Agreement
specifically requires otherwise, any notice, claim, demand, or communication
required or appropriate to be given in connection with this Agreement or to be
served, given, or made in connection with it, shall be made by facsimile (fax)
transmission, followed by written confirmation sent by U.S. Postal Service
certified mail, return receipt requested, to the following numbers and
addresses:

    For
TVA:

                   
                                Tennessee
Valley Authority

    Attn:  Executive Vice
President, Customer Resources

    One Century Place, 26 Century Blvd.,
OCP 1F-NST

    Nashville,
TN  37229

    Phone:  615-232-6011

    Fax: 615-232-6014

    

    
      
         

      

      
        –21–

        
          

        

      

      
         

      

    

    With copy
to:                        Tennessee
Valley Authority

    Attn:  Office of General
Counsel

    400 West Summit Hill Drive, WT
6A-K

    Knoxville,
TN  37902

    Phone: 865-632-4131

    Fax: 865-632-3307

    

    For Seven
States:                
Seven States Power Corporation

    Attn:  President and
CEO

    1206 Broad Street

    Chattanooga,
TN  37402

    Phone: 423-756-6511

    Fax: 423-267-9424

    

    With copy
to:                        Carlos
Smith

    Miller & Martin, PLLC

    832 Georgia Avenue

    Chattanooga,
TN  37402

    Phone: 423-785-8359

    Fax:  423-321-1659

    

    The Parties may change their designated
notice recipient, address, and fax numbers by fax and certified mail to the
other Party’s representative designated pursuant to this Section
19.

    20.  Assignment.  Except
as expressly provided for in Section 5(d) above with respect to Seven States’
assignments to Lenders, neither TVA nor Seven States shall sell, assign, or
otherwise alienate either:

    (a) its interests under this Agreement
or the Lease, or

    (b) its ownership interest in the
Purchased Assets

    to any
other entity without the prior written approval of the other Party.

               21.  Subject
to Applicable Laws.  This Agreement is made subject to present
and future applicable Laws.  Performance under this Agreement is
conditioned upon securing and retaining necessary local, state, and Federal
approvals, grants, or permits. Each Party shall use its Commercially Reasonable
best efforts to secure and retain all such approvals, grants, and permits within
such time as shall permit it to perform all of its obligations under this
Agreement.

     

     

    
      
        
        

      

      
        –22–

        
          

        

      

      
        
        

      

    

     

               22.  Confidentiality.  A
Party shall not disclose to a third party any information designated as
proprietary or confidential that it receives from the other Party (“Confidential
Information”) under the provisions of this Agreement except to comply with any
applicable Law; provided, however, that each Party
shall notify the other Party of any proceeding of which it is aware that may
result in disclosure of Confidential Information and use reasonable efforts to
prevent or limit the disclosure consistent with its obligations with respect to
such required disclosure.  The disclosing Party shall be entitled to
an injunction, specific performance, or other equitable relief to prevent the
violation of the promises and covenants of this Section 22.  Under
18 U.S.C. § 1905, officers and employees of TVA are subject to
criminal liability in the event Confidential Information is disclosed unless
such disclosure is authorized by Law.  Accordingly, Seven States
agrees that, in addition to the equitable relief identified in the immediately
preceding sentence, Seven States (to the extent it is a disclosing Party) shall
only be entitled to recover from TVA and its officers, agents, and employees
those gains wrongfully acquired, directly or indirectly, from unauthorized
disclosure of any Confidential Information covered under this
Agreement.  Notwithstanding any of the foregoing, a Party may disclose
Confidential Information on a strictly need-to-know basis to that Party's
officers, investors, consultants, lenders, prospective lenders, counsel, or
accountants, or to prospective buyers of the Purchased Assets’ electrical output
who have agreed to keep the terms confidential.  The obligations
contained in this Section 22 shall not apply to:  (a) any Confidential
Information that is now in or hereinafter enters the public domain without a
breach of this Agreement; (b) any Confidential Information known to the
receiving Party prior to the time of disclosure by the disclosing Party or
independently developed by employees of the receiving Party without access to
the Confidential Information; and (c) any Confidential Information disclosed in
good faith to the

     

     

    
      
        
        

      

      
        –23–

        
          

        

      

      
        
        

      

    

     

    receiving
Party by a third person legally entitled to disclose the same.  To the
extent that the confidentiality provisions in the Purchase Agreement are more
restrictive than under this Section 22, Seven States shall also comply with the
confidentiality provisions in the Purchase Agreement.

    23.  No
Indirect or Consequential Damages.  Notwithstanding any other
provision of this Agreement, neither Party shall be liable for, or bear any
obligation with respect to, the other Party, its agents, its representatives,
its affiliated and associated companies, or its assigns, for any indirect,
incidental, consequential, special, exemplary, or punitive damages of any kind
or character or any damages relating to or arising out of lost profits resulting
from either Party’s performance or non-performance of an obligation imposed on
it by this Agreement, regardless of the legal theory asserted by the other
Party.

    24.  Inadequacy
of Monetary Damages.  The Parties acknowledge and agree that
the transactions contemplated in this Agreement and the Lease are special,
unique, and of extraordinary character and that, if either Party violates or
fails and refuses to perform any covenant or agreement made by such Party in
this Agreement or the Lease, then the non-defaulting Party may be without
adequate remedy at law.  The Parties expressly agree, therefore, that
if a Party violates or fails and refuses to perform any covenant or agreement
made by such Party in this Agreement or the Lease, the non-defaulting Party may,
in addition to any remedies at law for damages or other relief, enforce specific
performance of such covenant or agreement or seek any other equitable relief,
subject to the non-defaulting Party’s performance of its obligations under this
Agreement and the Lease and the other terms and conditions thereof.

    25.  Entire
Agreement; Waiver of Compliance.  This Agreement, the Lease,
and related nondisclosure agreements supersede all prior written and oral
agreements that may have 

     

     

    
      
        
        

      

      
        –24–

        
          

        

      

      
        
        

      

    

     

    been
entered into between the Parties regarding the subject matter hereof and
constitute the entire agreement between the Parties with respect to the relevant
subject matter. To the extent permitted by applicable Law, any failure to comply
with any obligation, covenant, agreement, or condition set forth herein, or any
breach of any representation or warranty set forth herein, may be waived by the
Party entitled to the benefit of such obligation, covenant, agreement,
condition, representation, or warranty only by a written instrument signed by
such Party that expressly waives such failure or breach, but any such waiver
shall not operate as a waiver of, or estoppel with respect to, any prior or
subsequent failure to comply therewith or breach thereof.  The failure
of a Party to this Agreement to assert any of its rights under this Agreement or
otherwise shall not constitute a waiver of such rights.  A waiver by a
Party of the performance of any obligation, covenant, agreement, condition,
representation, or warranty of the other Party shall not invalidate this
Agreement, nor shall such waiver be construed as a waiver of any other
obligation, covenant, agreement, condition, representation, or
warranty.  A waiver by a Party of the time for performing any act
shall not constitute a waiver of the time for performing any other act or the
time for performing an identical act required to be performed at a later time.

    26.  Joint
Preparation of Agreement.  The language used in this Agreement
is the language chosen by both of the Parties to express their mutual
intent.  The Parties do not intend that any rule of strict
construction or interpretation shall be applied against either Party on the
grounds that such Party drafted this Agreement nor do they intend that any such
principle of interpretation shall be used to resolve any alleged
ambiguity.

    27.  No Oral
Amendments.  No change, modification, or amendment of this
Agreement shall be enforceable unless it is in writing and duly executed by both
of the Parties.  In addition, 

     

     

    
      
        
        

      

      
        –25–

        
          

        

      

      
        
        

      

    

     

     

    any
change, modification, or amendment of the provisions of Section 5 above shall
require the written consent of the Lenders.

    28.  Interpretation.  In
this Agreement, unless otherwise provided herein, the terms set forth in Section
1 have the meanings therein provided for.  Any term defined in Section
1, above, by reference to another document, instrument, or agreement shall
continue to have the meaning ascribed thereto whether or not such other
document, instrument, or agreement is in effect.  Words in the
singular include the plural and vice versa.  Words referring to one
gender include any gender.  A reference to any statute, regulation,
proclamation, ordinance, or other law includes all statutes, regulations,
proclamations, ordinances, and other laws varying, consolidating, or
replacing the same from time to time, and a reference to a statute includes all
regulations, policies, protocols, codes, proclamations, and ordinances issued or
otherwise applicable under that statute unless, in any such case, otherwise
expressly provided in any such statute.  A definition of or reference
to any document, instrument, or agreement includes each amendment or supplement
to, or restatement, replacement, substitution, successor, modification, or
novation of, any such document, instrument, or agreement unless otherwise
specified in such definition or in the context in which such reference is used,
provided that such documents were not amended in breach of a covenant contained
in any agreement to which TVA or Seven States is a party.  A reference
to a particular section, paragraph, or other part of a particular statute shall
be deemed to be a reference to any other section, paragraph, or other part
substituted therefor from time to time unless otherwise specified.  A
reference to any Person (as herein defined) includes such Person’s successors
and permitted assigns.  Any reference to “days” means calendar days
unless “Business Days” are expressly specified.  If the date as of
which any right, option, or election is exercisable, or the date upon which any
amount is due and payable, is stated 

     

     

    
      
        
        

      

      
        –26–

        
          

        

      

      
        
        

      

    

     

    to be on
a day that is not a Business Day, such right, option, or election may be
exercised, and such amount shall be deemed due and payable, on the next
succeeding Business Day, with the same effect as if the same were exercised or
made on such date or day, and no interest shall accrue or be payable with
respect to such payment.  Words such as “hereunder,” “hereto,”
“hereof,” and “herein” and other words of similar import shall, unless the
context requires otherwise, refer to the whole of the applicable document and
not to any particular article, section, subsection, paragraph, or clause
thereof.  A reference to “including” means including without limiting
the generality of any description preceding such term, and for purposes hereof
the rule of ejusdem generis shall not be applicable to limit a general
statement, followed by or referable to an enumeration of specific matters, to
matters similar to those specifically mentioned.  Unless otherwise
expressly stated, references in this Agreement to "Sections" and "Subsections"
are to Sections and Subsections of this Agreement.  Headings as found
in this Agreement are used solely for convenience in locating particular
provisions and do not constitute a part of this Agreement, nor should they be
used to aid in any manner in the construction of the Agreement.

    29.  Choice of
Law.  This Agreement shall be interpreted in accordance with
the Federal Law of the United States of America, unless there is no applicable
Federal Law, in which case (i) the Law of the State of Tennessee shall
apply to issues other than real property Law involving property located in the
State of Mississippi and (ii) the Law of the State of Mississippi shall
apply to real property Law issues involving property located in the State of
Mississippi.  In no event shall Federal or Tennessee or Mississippi
choice of law provisions be applied so as to apply the substantive Laws of
another jurisdiction.  TVA and Seven States hereby waive any right to
a jury trial.

     

     

    
      
        
        

      

      
        –27–

        
          

        

      

      
        
        

      

    

     

    30.  Choice of
Forum.  Any dispute under this Agreement that proceeds to court
after unsuccessful attempts to resolve it under Section 18 (Dispute Resolution),
above, shall be brought in the United States District Court for the Eastern
District of Tennessee.

    31.  Appointment
of TVA as Seven States’ Agent.  By executing and delivering
this Agreement, Seven States hereby appoints and authorizes TVA, and TVA hereby
accepts  appointment and authorization, to act as agent on behalf of
Seven States in accordance with the terms of this Agreement.  Except
as expressly provided herein, this Agreement does not create a joint venture,
partnership, or other special entity, status, or relationship among, or impose a
trust or partnership duty or obligation on, TVA, Seven States, or one or more of
the members of Seven States.

    32.  Severability.  If
any provision of this Agreement is unenforceable, the remaining provisions of
this Agreement shall be unaffected thereby and shall continue in force and
effect so that full effect is given the intent of the Parties, and the Parties
shall negotiate in good faith to restore the economic balance of benefits of
this Agreement if that balance is adversely affected by such a provision's
unenforceability.

    33.  Counterparts.  This
Agreement may be executed in several counterparts, each of which shall be
considered an original and all of which shall, when taken together, constitute
but one and the same instrument.

    34.  Performance
Standards.  All actions under this Agreement shall be conducted
in a prudent manner in accordance with Good Utility Practice.

    35.  Third-Party
Beneficiaries.  Except as specifically set forth in Section
5(d) above, nothing in this Agreement, express or implied, shall be construed to
create rights in, or to grant remedies to, or delegate any duty, obligation, or
undertaking established herein to any third party 

     

     

    
      
        
        

      

      
        –28–

        
          

        

      

      
        
        

      

    

     

    as a
beneficiary to this Agreement, nor is anything in this Agreement intended to
give any third party any rights of subrogation or action against a
Party.

    36.  Equal
Opportunity.  (a) It is the policy of the Federal
Government to provide equal employment opportunity, and in furtherance of that
policy, it is the policy of TVA, as an agency of the Federal Government, to
encourage equal employment opportunity in the various aspects of its programs,
including the joint ownership of generating facilities.  Accordingly,
during the term of this Agreement:

    36(b)  Seven States shall not
discriminate against any employee or applicant for employment because of race,
color, religion, sex, or national origin.  Seven States shall take
such affirmative action as is necessary to ensure that all applicants are
considered for employment and that all employees are treated in all aspects of
employment without regard to their race, color, religion, sex, or national
origin.

    36(c)  Seven States shall, in
all solicitations or advertisements for employees placed by or on behalf of
Seven States, state that all qualified applicants will receive consideration for
employment without regard to race, color, religion, sex, or national
origin.

    36(d)  Seven States shall
cooperate and participate with TVA in the development of training and
apprenticeship programs that will provide opportunities for applicants and
prospective applicants for employment with Seven States to become qualified for
such employment, and such cooperation shall include access by authorized TVA
representatives to Seven States’ books, records, and accounts pertaining to
training, apprenticeship, recruitment, and employment practices and
procedures.

    37.  Restriction
of Benefits.  No member of or delegate to Congress or Resident
Commissioner, or any officer, employee, special Government employee, or agent of
TVA shall 

     

     

    
      
        
        

      

      
        –29–

        
          

        

      

      
        
        

      

    

     

    be
admitted to any share or part of this Agreement or to any benefit that may arise
from it unless the Agreement be made with a corporation for its general
benefit.  Seven States shall not offer or give, directly or
indirectly, to any officer, employee, special Government employee, or agent of
TVA any gift, gratuity, favor, entertainment, loan, or any other thing of
monetary value, except as provided in 5 C.F.R. Part 2635 (as amended,
supplemented, or replaced).  Any breach of this provision shall
constitute a material breach of this Agreement.

    38.  Power and
Authority.  The Parties and the individuals and entities
signing this Agreement on their behalf warrant that they have the necessary
power and authority to execute this Agreement and thereby bind the respective
Parties.

    

    The Parties by their duly authorized
representatives are signing this Agreement as of April 30, 2008.

    

    

    SEVEN
STATES POWER CORPORATION

    

    

    

    By:   /s/ Jack
Simmons                                         

           Jack
Simmons

           Title:
President and Chief Executive Officer

    

    

    

    TENNESSEE
VALLEY AUTHORITY

    

    

    

    By:  
/s/ Tom
Kilgore                                           

             Tom
Kilgore

             Title:
President and Chief Executive Officer

    

    
      
         

      

      
        –30–exhibit4b.htm

    EXHIBIT
4(b)

    November
14, 2006

    

    Company
Order and Officers’ Certificate

    6.05%
Senior Notes, Series H, due 2037

    

    

    The Bank
of New York, as Trustee

    101
Barclay St. – 8W

    New York,
New York 10286

    

    Ladies
and Gentlemen:

    

    Pursuant
to Article Two of the Indenture, dated as of October 1, 1998 (as it may be
amended or supplemented, the “Indenture”), from Indiana Michigan Power Company
(the “Company”) to The Bank of New York, as trustee (the “Trustee”), and the
Board Resolutions dated July 28, 2005, a copy of which certified by the
Secretary or an Assistant Secretary of the Company is being delivered herewith
under Section 2.01 of the Indenture, and unless otherwise provided in a
subsequent Company Order pursuant to Section 2.04 of the Indenture,

    

    
      	
              1.

            	
              The
      Company’s 6.05% Senior Notes, Series H, due 2037 (the “Notes”) are hereby
      established.  The Notes shall be in substantially the form
      attached hereto as Exhibit 1.

            

    

    

    
      	
              2.

            	
              The
      terms and characteristics of the Notes shall be as follows (the numbered
      clauses set forth below corresponding to the numbered subsections of
      Section 2.01 of the Indenture, with terms used and not defined herein
      having the meanings specified in the
Indenture):

            

    

    

    
      	
               
      

            	
              (i)

            	
              the
      aggregate principal amount of Notes which may be authenticated and
      delivered under the Indenture shall be limited to $400,000,000, except as
      contemplated in Section 2.01 of the
Indenture;

            

    

    

    
      	
               
      

            	
              (ii)

            	
              the
      date on which the principal of the Notes shall be payable shall be March
      15, 2037;

            
	 	 	 
	 	(iii)	interest
      shall accrue from the date of authentication of the Notes; the Interest
      Payment Dates on which such interest will be payable shall be March 15 and
      September 15, and the Regular Record Date for the determination of holders
      to whom interest is payable on any such Interest Payment Date shall be the
      February 28 or August 31 prior to the relevant Interest Payment Date;
      provided that the first Interest Payment Date shall be March 15, 2007 and
      interest payable on the Stated Maturity Date or any Redemption Date shall
      be paid to the Person to whom principal shall be
paid;

      

    
      	
               
      

            	
              (iv)

            	
              the
      interest rate at which the Notes shall bear interest shall be 6.05% per
      annum;

            
	 	 	 
	 	(v)	the
      Notes shall be redeemable at the option of the Company, in whole at any
      time or in part from time to time, upon not less than thirty but not more
      than sixty days’ previous notice given by mail to the registered owners of
      the Notes at a redemption price equal to the greater of (i) 100% of the
      principal amount of the Notes being redeemed and (ii) the sum of the
      present values of the remaining scheduled payments of principal and
      interest on the Notes being redeemed (excluding the portion of any such
      interest accrued to the date of redemption) discounted (for purposes of
      determining present value) to the redemption date on a semi-annual basis
      (assuming a 360-day year consisting of twelve 30-day months) at the
      Treasury Rate (as defined below) plus 25 basis points, plus, in each case,
      accrued interest thereon to the date of
redemption.

    

          

    “Treasury
Rate” means, with respect to any redemption date, the rate per annum equal to
the semi-annual equivalent yield to maturity of the Comparable Treasury Issue,
assuming a price for the Comparable Treasury Issue (expressed as a percentage of
its principal amount) equal to the Comparable Treasury Price for such redemption
date.

    

    “Comparable
Treasury Issue” means the United States Treasury security selected by an
Independent Investment Banker as having a maturity comparable to the remaining
term of the Notes that would be utilized, at the time of selection and in
accordance with customary financial practice, in pricing new issues of corporate
debt securities of comparable maturity to the remaining term of the
Notes.

    

    “Comparable
Treasury Price” means, with respect to any redemption date, (i) the average of
the Reference Treasury Dealer Quotation for such redemption date, after
excluding the highest and lowest such Reference Treasury Dealer Quotations, or
(ii) if the Company obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such quotations.

    

    

    “Independent
Investment Banker” means one of the Reference Treasury Dealers appointed by the
Company and reasonably acceptable to the Trustee.

    

    “Reference
Treasury Dealer” means a primary U.S. government securities dealer in New York
City selected by the Company and reasonably acceptable to the
Trustee.

    

    “Reference
Treasury Dealer Quotation” means, with respect to the Reference Treasury Dealer
and any redemption date, the average, as determined by the Trustee, of the bid
and asked prices for the Comparable Treasury Issue (expressed in each case as a
percentage of its principal amount) quoted in writing to the Trustee by such
Reference Treasury Dealer at or before 5:00 p.m., New York City time, on the
third Business Day preceding such redemption date.

     

    
      	
               
      

            	
              (vi)

            	
              (a)
      the Notes shall be issued in the form of a Global Note; (b) the Depositary
      for such Global Note shall be The Depository Trust Company; and (c) the
      procedures with respect to transfer and exchange of Global Notes shall be
      as set forth in the form of Note attached
  hereto;

            

    

    

    
      	
               
      

            	
              (vii)

            	
              the
      title of the Notes shall be “6.05% Senior Notes, Series H, due
      2037”;

            
	 	 	 
	 	(viii)	
              the
      form of the Notes shall be as set forth in Paragraph 1,
    above;

            

    

    

    
    

    
      	
               
      

            	
              (ix)

            	
              not
      applicable;

            

    

    

    
      	
               
      

            	
              (x)

            	
              the
      Notes may be subject to a Periodic
Offering;

            

    

    

    
      	
               
      

            	
              (xi)

            	
              not
      applicable;

            

    

    

    
      	
               
      

            	
              (xii)

            	
              not
      applicable;

            
	 	 	 
	 	(xiii)	
              not
      applicable;

            
	 	 	 
	 	(xiv)	
              the
      Notes shall be issuable in denominations of $1,000 and any integral
      multiple thereof;

            

    

     

    
      	
               
      

            	
              (xv)

            	
              not
      applicable;

            
	 	 	 
	 	(xvi)	
              the
      Notes shall not be issued as Discount Securities;

            
	 	 	 
	 	(xvii) 	not
      applicable;
	 	 	 
	 	(xviii)	not
      applicable; and
	 	 	 
	 	(xix)	Limitations
      on Liens:

    

    

    

    So long
as any of the Notes are outstanding, the Company will not create or suffer to be
created or to exist any mortgage, pledge, security interest, or other lien
(collectively “Liens”) on any of the Company’s utility properties or tangible
assets now owned or hereafter acquired to secure any indebtedness for borrowed
money (“Secured Debt”), without providing that such Notes will be similarly
secured.  This restriction does not apply to the Company’s
subsidiaries, nor will it prevent any of them from creating or permitting to
exist Liens on their property or assets to secure any Secured
Debt.  In addition, this restriction does not prevent the creation or
existence of:

    

    
      	
              ·  

            	
              Liens
      on property existing at the time of acquisition or construction of such
      property (or created within one year after completion of such acquisition
      or construction), whether by purchase, merger, construction or otherwise,
      or to secure the payment of all or any part of the purchase price or
      construction cost thereof, including the extension of any Liens to
      repairs, renewals, replacements substitutions, betterments, additions,
      extensions and improvements then or thereafter made on the property
      subject thereto;

            

    

    

    
      	
              ·  

            	
              Financing
      of the Company’s accounts receivable for electric
  service;

            

    

    

    
      	
              ·  

            	
              Any
      extensions, renewals or replacements (or successive extensions, renewals
      or replacements), in whole or in part, of liens permitted by the foregoing
      clauses; and

            

    

    

    
      	
              ·  

            	
              The
      pledge of any bonds or other securities at any time issued under any of
      the Secured Debt permitted by the above
clauses.

            

    

    

    In
addition to the permitted issuances above, Secured Debt not otherwise so
permitted may be issued in an amount that does not exceed 15% of Net Tangible
Assets as defined below.

    

    “Net
Tangible Assets” means the total of all assets (including revaluations thereof
as a result of commercial appraisals, price level restatement or otherwise)
appearing on the Company’s balance sheet, net of applicable reserves and
deductions, but excluding goodwill, trade names, trademarks, patents,
unamortized debt discount and all other like intangible assets (which term shall
not be construed to include such revaluations), less the aggregate of the
Company’s current liabilities appearing on such balance sheet.  For
purposes of this definition, the Company's balance sheet does not include assets
and liabilities of its subsidiaries.

    

    This restriction also will not apply to
or prevent the creation or existence of leases (operating or capital) made, or
existing on property acquired, in the ordinary course of business.

    

    
      	
              3.

            	
              You
      are hereby requested to authenticate $400,000,000 aggregate principal
      amount of 6.05% Senior Notes, Series H, due 2037, executed by the Company
      and delivered to you concurrently with this Company Order and Officers’
      Certificate, in the manner provided by the
  Indenture.

            

    

    

    
      	
              4.

            	
              You
      are hereby requested to hold the Notes as custodian for DTC in accordance
      with the Blanket Issuer Letter of Representations dated November 10, 2004,
      from the Company to DTC.

            

    

    

    
      	
              5.

            	
              Concurrently
      with this Company Order and Officers’ Certificate, an Opinion of Counsel
      under Sections 2.04 and 13.06 of the Indenture is being delivered to
      you.

            

    

    

    
      	
              6.

            	
              The
      undersigned Stephan T. Haynes and Thomas G. Berkemeyer, the Assistant
      Treasurer and Assistant Secretary, respectively, of the Company do hereby
      certify that:

            

    

    

    
      	
               
      

            	
              (i)

            	
              we
      have read the relevant portions of the Indenture, including without
      limitation the conditions precedent provided for therein relating to the
      action proposed to be taken by the Trustee as requested in this Company
      Order and Officers’ Certificate, and the definitions in the Indenture
      relating thereto;

            

    

    

    
      	
               
      

            	
              (ii)

            	
              we
      have read the Board Resolutions of the Company and the Opinion of Counsel
      referred to above;

            

    

    

    
      	
               
      

            	
              (iii)

            	
              we
      have conferred with other officers of the Company, have examined such
      records of the Company and have made such other investigation as we deemed
      relevant for purposes of this
certificate;

            

    

    

    
      	
               
      

            	
              (iv)

            	
              in
      our opinion, we have made such examination or investigation as is
      necessary to enable us to express an informed opinion as to whether or not
      such conditions have been complied with;
and

            

    

    

    
      	
               
      

            	
              (v)

            	
              on
      the basis of the foregoing, we are of the opinion that all conditions
      precedent provided for in the Indenture relating to the action proposed to
      be taken by the Trustee as requested herein have been complied
      with.

            

    

    

    Kindly
acknowledge receipt of this Company Order and Officers’ Certificate, including
the documents listed herein, and confirm the arrangements set forth herein by
signing and returning the copy of this document attached hereto.

    

    Very
truly yours,

    

    INDIANA
MICHIGAN POWER COMPANY

    

    

    By: ___/s/ Stephan T.
Haynes______

    Stephan T. Haynes

    Assistant Treasurer

    

    

    And:___/s/ Thomas G.
Berkemeyer__

    Thomas G. Berkemeyer

    Assistant Secretary

    

    

    Acknowledged
by Trustee:

    

    

    By:___/s/ Mary
LaGumina________

     Authorized Signatory

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Exhibit
1

    

    Unless
this certificate is presented by an authorized representative of The Depository
Trust Company (55 Water Street, New York, New York) to the issuer or its agent
for registration of transfer, exchange or payment, and any certificate to be
issued is registered in the name of Cede & Co. or in such other name as is
requested by an authorized representative of The Depository Trust Company and
any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest
herein.  Except as otherwise provided in Section 2.11 of the
Indenture, this Security may be transferred, in whole but not in part, only to
another nominee of the Depository or to a successor Depository or to a nominee
of such successor Depository.

    

    No.   R1

    

    INDIANA
MICHIGAN POWER COMPANY

    6.05%
Senior Notes, Series H, due 2037

    

    

    CUSIP:  454889
AM
8                                                                                                        Original
Issue Date:  November 14, 2006

    

    Stated
Maturity:  March 15,
2037                                                                                         Interest
Rate:                                 6.05%

    

    Principal
Amount:  $400,000,000

    

    Redeemable:                Yes  þ                                No   ̈

    In
Whole:                     Yes  þ                                No   ̈

    In
Part:                         Yes  þ                                No   ̈

    

    INDIANA MICHIGAN POWER COMPANY, a
corporation duly organized and existing under the laws of the State of Indiana
(herein referred to as the “Company”, which term includes any successor
corporation under the Indenture hereinafter referred to), for value received,
hereby promises to pay to CEDE & CO. or registered assigns, the Principal
Amount specified above on the Stated Maturity specified above, and to pay
interest on said Principal Amount from the Original Issue Date specified above
or from the most recent interest payment date (each such date, an “Interest
Payment Date”) to which interest has been paid or duly provided for,
semi-annually in arrears on March 15 and September 15 in each year, commencing
on March 15, 2007, at the Interest Rate per annum specified above, until the
Principal Amount shall have been paid or duly provided for.  Interest
shall be computed on the basis of a 360-day year of twelve 30-day
months.

    

    The interest so payable, and punctually
paid or duly provided for, on any Interest Payment Date, as provided in the
Indenture, as hereinafter defined, shall be paid to the Person in whose name
this Note (or one or more Predecessor Securities) shall have been registered at
the close of business on the Regular Record Date with respect to such Interest
Payment Date, which shall be the February 28 or August 31 (whether or not a
Business Day) prior to such Interest Payment Date, provided that interest
payable on the Stated Maturity or any redemption date shall be paid to the
Person to whom principal is paid.  Any such interest not so punctually
paid or duly provided for shall forthwith cease to be payable to the Holder on
such Regular Record Date and shall be paid as provided in said
Indenture.

    

    If any Interest Payment Date, any
redemption date or Stated Maturity is not a Business Day, then payment of the
amounts due on this Note on such date will be made on the next succeeding
Business Day, and no interest shall accrue on such amounts for the period from
and after such Interest Payment Date, redemption date or Stated Maturity, as the
case may be, with the same force and effect as if made on such
date.  The principal of (and premium, if any) and the interest on this
Note shall be payable at the office or agency of the Company maintained for that
purpose in the Borough of Manhattan, the City of New York, New York, in any coin
or currency of the United States of America which at the time of payment is
legal tender for payment of public and private debts; provided, however, that
payment of interest (other than interest payable on the Stated Maturity or any
redemption date) may be made at the option of the Company by check mailed to the
registered holder at such address as shall appear in the Security
Register.

    

    This Note is one of a duly authorized
series of Notes of the Company (herein sometimes referred to as the “Notes”),
specified in the Indenture, all issued or to be issued in one or more series
under and pursuant to an Indenture dated as of October 1, 1998 duly executed and
delivered between the Company and The Bank of New York, a corporation organized
and existing under the laws of the State of New York, as Trustee (herein
referred to as the “Trustee”) (such Indenture, as originally executed and
delivered and as thereafter supplemented and amended being hereinafter referred
to as the “Indenture”), to which Indenture and all indentures supplemental
thereto or Company Orders reference is hereby made for a description of the
rights, limitations of rights, obligations, duties and immunities thereunder of
the Trustee, the Company and the holders of the Notes.  By the terms
of the Indenture, the Notes are issuable in series which may vary as to amount,
date of maturity, rate of interest and in other respects as in the Indenture
provided.  This Note is one of the series of Notes designated on the
face hereof.

    

    This Note may be redeemed by the
Company at its option, in whole at any time or in part from time to time, upon
not less than thirty but not more than sixty days’ prior notice given by mail to
the registered owners of the Notes at a redemption price equal to the greater of
(i) 100% of the principal amount of the Notes being redeemed and (ii) the sum of
the present values of the remaining scheduled payments of principal and interest
on the Notes being redeemed (excluding the portion of any such interest accrued
to the date of redemption) discounted (for purposes of determining present
value) to the redemption date on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Treasury Rate (as defined below) plus
25 basis points, plus, in each case, accrued interest thereon to the date of
redemption.

    

    “Treasury
Rate” means, with respect to any redemption date, the rate per annum equal to
the semi-annual equivalent yield to maturity of the Comparable Treasury Issue,
assuming a price for the Comparable Treasury Issue (expressed as a percentage of
its principal amount) equal to the Comparable Treasury Price for such redemption
date.

    

    “Comparable
Treasury Issue” means the United States Treasury security selected by an
Independent Investment Banker as having a maturity comparable to the remaining
term of the Notes that would be utilized, at the time of selection and in
accordance with customary financial practice, in pricing new issues of corporate
debt securities of comparable maturity to the remaining term of the
Notes.

    

    

    “Comparable
Treasury Price” means, with respect to any redemption date, (1) the average of
the Reference Treasury Dealer Quotations for such redemption date, after
excluding the highest and lowest such Reference Treasury Dealer Quotations, or
(2) if we obtain fewer than four such Reference Treasury Dealer Quotations, the
average of all such quotations.

    

    “Independent
Investment Banker” means one of the Reference Treasury Dealers appointed by the
Company and reasonably acceptable to the Trustee.

    

    “Reference
Treasury Dealer” means a primary U. S. government securities dealer in New York
City selected by the Company and reasonably acceptable to the
Trustee.

    

    “Reference
Treasury Dealer Quotation” means, with respect to the Reference Treasury Dealer
and any redemption date, the average, as determined by the Trustee, of the bid
and asked prices for the Comparable Treasury Issue (expressed in each case as a
percentage of its principal amount) quoted in writing to the Trustee by such
Reference Treasury Dealer at or before 5:00 p.m., New York City time, on the
third Business Day preceding such redemption date.

    

    The Company shall not be required to
(i) issue, exchange or register the transfer of any Notes during a period
beginning at the opening of business 15 days before the day of the mailing of a
notice of redemption of less than all the outstanding Notes of the same series
and ending at the close of business on the day of such mailing, nor (ii)
register the transfer of or exchange of any Notes of any series or portions
thereof called for redemption.  This Global Note is exchangeable for
Notes in definitive registered form only under certain limited circumstances set
forth in the Indenture.

    

    In the event of redemption of this Note
in part only, a new Note or Notes of this series, of like tenor, for the
unredeemed portion hereof will be issued in the name of the Holder hereof upon
the surrender of this Note.

    

    In case an Event of Default, as defined
in the Indenture, shall have occurred and be continuing, the principal of all of
the Notes may be declared, and upon such declaration shall become, due and
payable, in the manner, with the effect and subject to the conditions provided
in the Indenture.

    

    The Indenture contains provisions for
defeasance at any time of the entire indebtedness of this Note upon compliance
by the Company with certain conditions set forth therein.

    

    As described in the Company Order and
Officers’ Certificate, so long as this Note is outstanding, the Company is
subject to a limitation on Liens as described therein.

    

    The Indenture contains provisions
permitting the Company and the Trustee, with the consent of the Holders of not
less than a majority in aggregate principal amount of the Notes of each series
affected at the time outstanding, as defined in the Indenture, to execute
supplemental indentures for the purpose of adding any provisions to or changing
in any manner or eliminating any of the provisions of the Indenture or of any
supplemental indenture or of modifying in any manner the rights of the Holders
of the Notes; provided, however, that no such supplemental indenture shall (i)
extend the fixed maturity of any Notes of any series, or reduce the principal
amount thereof, or reduce the rate or extend the time of payment of interest
thereon, or reduce any premium payable upon the redemption thereof, or reduce
the amount of the principal of a Discount Security that would be due and payable
upon a declaration of acceleration of the maturity thereof pursuant to the
Indenture, without the consent of the holder of each Note then outstanding and
affected; (ii) reduce the aforesaid percentage of Notes, the holders of which
are required to consent to any such supplemental indenture, or reduce the
percentage of Notes, the holders of which are required to waive any default and
its consequences, without the consent of the holder of each Note then
outstanding and affected thereby; or (iii) modify any provision of Section
6.01(c) of the Indenture (except to increase the percentage of principal amount
of securities required to rescind and annul any declaration of amounts due and
payable under the Notes), without the consent of the holder of each Note then
outstanding and affected thereby.  The Indenture also contains
provisions permitting the Holders of a majority in aggregate principal amount of
the Notes of all series at the time outstanding affected thereby, on behalf of
the Holders of the Notes of such series, to waive any past default in the
performance of any of the covenants contained in the Indenture, or established
pursuant to the Indenture with respect to such series, and its consequences,
except a default in the payment of the principal of or premium, if any, or
interest on any of the Notes of such series.  Any such consent or
waiver by the registered Holder of this Note (unless revoked as pro­vided in
the Indenture) shall be conclusive and binding upon such Holder and upon all
future Holders and owners of this Note and of any Note issued in exchange
herefor or in place hereof (whether by registration of transfer or otherwise),
irrespective of whether or not any notation of such consent or waiver is made
upon this Note.

    

    No reference herein to the Indenture
and no provision of this Note or of the Indenture shall alter or impair the
obligation of the Company, which is absolute and unconditional, to pay the
principal of and premium, if any, and interest on this Note at the time and
place and at the rate and in the money herein prescribed.

    

    As provided in the Indenture and
subject to certain limitations therein set forth, this Note is transferable by
the registered holder hereof on the Security Register of the Company, upon
surrender of this Note for registration of transfer at the office or agency of
the Company as may be designated by the Company accompanied by a written
instrument or instruments of transfer in form satisfactory to the Company or the
Trustee duly executed by the registered Holder hereof or his or her attorney
duly authorized in writing, and thereupon one or more new Notes of authorized
denominations and for the same aggregate principal amount and series will be
issued to the designated transferee or transferees.  No service charge
will be made for any such trans­fer, but the Company may require payment of
a sum sufficient to cover any tax or other governmental charge payable in
relation thereto.

    

    Prior to due presentment for
registration of transfer of this Note, the Company, the Trustee, any paying
agent and any Security Registrar may deem and treat the registered Holder hereof
as the absolute owner hereof (whether or not this Note shall be overdue and
notwithstanding any notice of ownership or writing hereon made by anyone other
than the Security Registrar) for the purpose of receiving payment of or on
account of the principal hereof and premium, if any, and interest due hereon and
for all other purposes, and neither the Company nor the Trustee nor any paying
agent nor any Security Registrar shall be affected by any notice to the
contrary.

    

    No recourse shall be had for the
payment of the principal of or the interest on this Note, or for any claim based
hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture, against any incorporator, stockholder, officer or director, past,
present or future, as such, of the Company or of any predecessor or successor
corporation, whether by virtue of any constitution, statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the
issuance hereof, expressly waived and released.

    

    The Notes of this series are issuable
only in registered form without coupons in denominations of $1,000 and any
integral multiple thereof.  As provided in the Indenture and subject
to certain limitations, Notes of this series are exchangeable for a like
aggregate principal amount of Notes of this series of a different authorized
denomination, as requested by the Holder surrendering the same.

    

    All terms used in this Note which are
defined in the Indenture shall have the meanings assigned to them in the
Indenture.

    

    This Note shall not be entitled to any
benefit under the Indenture hereinafter referred to, be valid or become
obligatory for any purpose until the Certificate of Authentication hereon shall
have been signed by or on behalf of the Trustee.

    

    IN WITNESS WHEREOF, the Company has
caused this Instrument to be executed.

    

    INDIANA MICHIGAN POWER
COMPANY

    

    

    By: /s/ Stephan T.
Haynes________

    Stephan T. Haynes

    Assistant Treasurer

    Attest:

    

    

    By: /s/ Thomas G.
Berkemeyer_______

    Thomas G. Berkemeyer

    Assistant Secretary

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    CERTIFICATE
OF AUTHENTICATION

    

    This is one of the Notes of the series
of Notes designated in accordance with, and referred to in, the within-mentioned
Indenture.

    

    Dated:  November
14, 2006

    

    THE BANK
OF NEW YORK

    

    

    By: /s/ Mary LaGumina 
_______

       Authorized
Signatory

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    FOR VALUE RECEIVED, the undersigned
hereby sell(s), assign(s) and transfer(s) unto

    

    (PLEASE
INSERT SOCIAL SECURITY OR OTHER

       IDENTIFYING
NUMBER OF ASSIGNEE)

    

    _______________________________________

    

    ________________________________________________________________

    

    ________________________________________________________________

    (PLEASE
PRINT OR TYPE NAME AND ADDRESS, INCLUDING ZIP CODE, OF

    ________________________________________________________________

    ASSIGNEE)
the within Note and all rights thereunder, hereby

    ________________________________________________________________

    irrevocably
constituting and appointing such person attorney to

    ________________________________________________________________

    transfer
such Note on the books of the Issuer, with full

    ________________________________________________________________

    power of
substitution in the premises.

    

    

    

    Dated:________________________                                                                                     _________________________

    

    

    

    
      	
              NOTICE:

            	
              The
      signature to this assignment must correspond with the name as written upon
      the face of the within Note in every particular, without alteration or
      enlargement or any change whatever and NOTICE:  Signature(s)
      must be guaranteed by a financial institution that is a member of the
      Securities Transfer Agents Medallion Program (“STAMP”), the Stock Exchange
      Medallion Program (“SEMP”) or the New York Stock Exchange, Inc. Medallion
      Signature Program (“MSP”).

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