<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>8
<FILENAME>x10m1.txt
<DESCRIPTION>(M)(1) EMPLOYMENT AGREEMENT OF MICHAEL G. MORRIS
<TEXT>
                                                                EXHIBIT 10(m)(1)


                              EMPLOYMENT AGREEMENT

            This AGREEMENT is made as of this December 15, 2003, by and among
AMERICAN ELECTRIC POWER COMPANY, INC., a New York corporation ("AEP"), and
AMERICAN ELECTRIC POWER SERVICE CORPORATION, a New York corporation and a
wholly-owned subsidiary of AEP ("Service Corporation") (AEP and Service
Corporation hereinafter referred to collectively as the "Companies"), and
Michael G. Morris ("Executive").

                                    RECITALS

            In order to induce Executive to serve as the President and Chief
Executive Officer of AEP and Service Corporation, as well as Chief Executive
Officer of other major subsidiaries of AEP, the Companies desire to provide
Executive with compensation and other benefits on the terms and conditions set
forth in this Agreement.

            Executive is willing to accept such employment and perform services
for the Companies, on the terms and conditions hereinafter set forth.

            It is therefore hereby agreed by and between the parties as follows:

1. Employment.

1.1 Positions and Reporting. Subject to the terms and conditions of this
Agreement, effective as of the Commencement Date (as defined in Section 2
below), the Companies agree to engage Executive during the term hereof as
President and Chief Executive Officer of each of AEP and Service Corporation, as
well as such major subsidiaries of AEP as the board of directors of AEP (the
"Board") shall designate. In such capacities, Executive shall have the customary
powers, responsibilities and authorities of such offices for corporations of the
size, type and nature of the Companies (and such major subsidiaries of AEP, as
applicable), as they exist from time to time. During the term of this Agreement,
Executive, in carrying out his duties under this Agreement, shall report
directly to the Board.

1.2 Boards of Directors. AEP shall, during the term of this Agreement, cause the
election and retention of Executive as a member of the board of directors of
each subsidiary of AEP as selected by the Board. Executive agrees to serve, if
elected, as Chairman of the Board (and on any committees of the Board), in
addition to serving on the board of directors (and any committees thereof) of
each subsidiary of AEP.

1.3   Executive Agreements and Representations.

(a) Subject to the terms and conditions of this Agreement, effective as of the
Commencement Date, Executive hereby agrees to be employed as President and Chief
Executive Officer of each of AEP and Service Corporation and agrees to devote
his full working time and efforts, to the best of his ability, experience and
talent, to the performance of services, duties and responsibilities in
connection therewith. Executive shall perform such duties and exercise such
powers commensurate with his positions and shall accept such other positions or
titles of other corporations affiliated with the Companies (including, without
limitation, Chief Executive Officer of other subsidiaries of AEP), in each
instance as the Board shall from time to time delegate to him on such terms and
conditions and subject to such restrictions as may reasonably from time to time
be imposed.

(b) Executive hereby represents that the execution and delivery of this
Agreement by Executive and the performance by Executive of Executive's duties
hereunder do not constitute a breach of, or otherwise contravene, the terms of
any employment agreement or other noncompetition agreement or policy (including
any agreement with Executive's prior employment, Northeast Utilities ("Prior
Employer")) to which Executive is a party or otherwise bound. Executive also
hereby represents that in no event shall any of the Companies or their
subsidiaries become subject to any liability that may arise in connection with
that certain litigation between Con Edison and the Prior Employer that is
ongoing as of the date hereof, and further agrees to indemnify and hold harmless
the Companies and their subsidiaries from any liability that they may incur with
respect thereto.

1.4 Other Boards and Activities. Notwithstanding anything set forth in this
Agreement, during the term of this Agreement, subject to the prior express
written consent of the Directors and Corporate Governance Committee of the
Board, Executive shall be permitted to serve on the boards of directors (or
advisory committees) of a reasonable number of other corporations or entities
and of a reasonable number of trade associations and/or charitable
organizations. During the term of this Agreement, Executive shall also otherwise
be permitted to engage in a reasonable number of charitable activities and
community affairs and manage his personal investments and affairs, provided that
such activities set forth in this Section 1.4 do not conflict or materially
interfere with the effective discharge of his duties and responsibilities under
this Agreement.

2. Term of Employment. The term of this Agreement shall begin on January 1, 2004
(the "Commencement Date"), and shall extend until the third anniversary of the
Commencement Date, with automatic one-year renewals commencing on such third
anniversary and on each anniversary thereafter, unless and until either party
hereto notifies the other at least six (6) months before the scheduled renewal
date that the term of this Agreement is not to be renewed. Notwithstanding the
foregoing, the term of this Agreement (and Executive's employment hereunder) may
be earlier terminated by either party in accordance with the provisions of
Section 4 of this Agreement.

3. Compensation; Benefits.

3.1 Base Salary. During the term of this Agreement, Service Corporation shall
pay Executive a base salary ("Base Salary") at the rate of $1,115,000 per annum,
payable in accordance with the ordinary payroll practices of the Companies.
After December 31, 2004, Executive's rate of Base Salary shall be reviewed
annually by the Human Resources Committee of the Board and, if increased, such
increased amount shall constitute Executive's Base Salary.

3.2   Compensation Plans and Programs.

(a) Annual Bonus. During the term of this Agreement, Executive shall
be eligible to earn an annual bonus (the "Annual Bonus") in respect of each
calendar year of AEP occurring during the term of employment pursuant to the
Senior Officer Annual Incentive Compensation Plan or such other annual incentive
program maintained by the Companies from time to time in which other senior
executives of the Companies participate, on terms comparable to those applicable
to such other senior executives (the "Annual Bonus Plan"). During the term of
the Agreement, under the Annual Bonus Plan, the amount of Executive's Annual
Bonus shall be based upon a percentage of Executive's Base Salary (or such other
metric as the Board may establish pursuant to the Annual Bonus Plan); provided
that the target Annual Bonus percentage under the Annual Bonus Plan for each
calendar year occurring during the term of the Agreement shall be equal to at
least one hundred percent (100%) of the amount of Base Salary Executive actually
earned in the calendar year in respect of which the Annual Bonus, if any, is
payable (the "Target Bonus"). Any Annual Bonus shall only be payable upon the
achievement by the Companies as a whole of certain performance goals to be
established in respect of each calendar year by the Board; provided, however,
that Executive shall receive an Annual Bonus in respect of the first calendar
year occurring during the term of the Agreement that shall in no event be less
than the Target Bonus. Notwithstanding any of the foregoing, and subject to the
provisions of Section 4 of this Agreement, in the event that the term of this
Agreement is scheduled to terminate prior to the end of any given calendar year
of the Companies, Executive shall only be eligible to earn a pro rata portion of
his Annual Bonus in respect of such calendar year, based on the number of days
during such calendar year in which Executive is employed hereunder.

(b) Deferred Compensation Plan. During the term of this Agreement, Executive
shall be eligible to participate in any deferred compensation plan or program
maintained by the Companies from time to time in which other senior executives
of the Companies participate, on terms comparable to those applicable to such
other senior executives.

3.3   Benefit Plans and Perquisites.

(a) Generally. The Companies shall provide Executive, during the term of his
employment hereunder, with coverage under all employee benefit programs, plans
and practices (commensurate with his positions in the Companies and to the
extent permitted under any employee benefit plan) in accordance with the terms
thereof, which the Companies make available to its senior executives and other
employees including, without limitation, retiree medical insurance program as in
effect as of the date of Executive's retirement from employment hereunder;
provided, however, that at the Companies' discretion, Service Corporation may
pay Executive an amount in cash sufficient, in the good faith determination of
the Companies, for Executive to purchase a retiree medical insurance policy for
Executive (and his eligible dependents) that provides retiree medical insurance
benefits that are equivalent to such benefits as provided under the Companies'
retiree medical insurance program to their senior executives as in effect at
such time.

(b) Perquisites. Executive shall be entitled to the perquisites and other fringe
benefits generally made available to senior executives of the Companies,
commensurate with his position with the Companies, including, without
limitation: (1) use of memberships sponsored by the Companies for their senior
executives at local country clubs and/or local luncheon clubs; (2) use of any
aircraft owned or leased by the Companies for transportation of their
executives, for both business and personal use, in accordance with the
Companies' policies in effect from time to time for senior executives; (3)
gross-up payments to cover applicable federal, state and local income taxes on
such portion of any imputed income associated with Executive's personal use of
aircraft owned or leased by the Companies and in accordance with such
calculation methodology as may be determined from time to time by the Human
Resources Committee of the Board; and (4) participation in the Companies'
financial counseling program as in effect for senior executives from time to
time.

(c) Life Insurance. During the term of this Agreement, Service Corporation will
use its reasonable best efforts to purchase and maintain, for the benefit of
Executive and his designated beneficiaries, a universal life insurance policy
that provides at least a $3,000,000 death benefit.

(d) Credit for Service; Pension Benefit. The Companies and Executive hereby
agree that the opening balance of Executive's cash balance account under the AEP
Excess Benefit Plan shall be $2,100,000, in which account Executive shall become
vested, subject to his continued employment hereunder, in increments of twenty
percent (20%) on each of the first five anniversaries of the Commencement Date.
In recognition of his prior experience, the Companies and Executive also agree
that Executive's cash balance account under the AEP Excess Benefit Plan shall,
effective as of the Commencement Date, be credited with an amount such that the
total credit under the AEP Retirement Plan and the AEP excess Benefit Plan shall
be the maximum rate permitted under such plans as amended from time to time
(currently 8.5%) on all eligible earnings thereunder (which eligible earnings
may not exceed $1,000,000 annually). Subject to the foregoing in this Section
3.3(d), all other provisions of the AEP Retirement Plan and AEP Excess Benefit
Plan as in effect from time to time shall apply to Executive's participation
therein.

(e) Vacation. During the term of this Agreement, Executive shall be entitled to
five weeks of paid vacation (and such paid holidays as provided to senior
executives of the Companies under the applicable vacation policy in effect from
time to time), to be taken at such time(s) as Executive and the Board reasonably
agrees is appropriate.

(f) Reimbursement of Business Expenses. Executive is authorized to incur
reasonable expenses in carrying out his duties and responsibilities under this
Agreement, including reimbursement for any reasonable automobile expenses
(including mileage) incurred in connection with travel (other than for any
commute between Executive's principal office location and primary residence) by
Executive in performance of his duties. Service Corporation shall promptly
reimburse Executive for all reasonable business expenses incurred in connection
with the performance of his duties hereunder, subject to Executive's provision
of reasonable documentation of such expenses in accordance with the Companies'
business expense reimbursement policy for senior executives.

(g) Payment of Relocation Expenses. To assist Executive in relocating from his
principal residence (as of the date hereof) to Columbus, Ohio, Executive shall
participate in the Relocation Expense Policy for Newly Hired Exempt Employees (a
copy of which is attached as Exhibit A hereto).

3.4 Long-Term Incentive Awards. During the term of this Agreement, AEP shall
provide Executive with the opportunity to participate in the American Electric
Power System 2000 Long-Term Incentive Plan, as amended from time to time (the
"LTIP"), under which AEP shall grant to Executive the following equity-based
compensation awards, which shall, as of the Commencement Date, have an aggregate
target value equal to 360% of Executive's Base Salary: (a) Stock Options. On the
Commencement Date, AEP shall grant to Executive options to purchase not less
than 149,000 shares of common stock of AEP ("AEP Stock") pursuant to the LTIP
(the "Options"). Subject to Executive's continued employment hereunder, the
Options shall vest as to one-third of the shares subject to the Options on the
January 1 following each of the first three anniversaries of the grant date of
the Options, and otherwise shall be granted on such terms and pursuant to such
award agreements as provided to senior executives of the Companies generally
under the LTIP.

(b) Performance Shares. On the Commencement Date, Executive will be
awarded 119,000 performance share units pursuant to the LTIP. The actual number
of performance share units that may be earned will be subject to the
satisfaction of the performance metrics to be established by the Human Resources
Committee of the Board. Executive shall vest in any such earned performance
share units, subject to the Executive's continued employment, on December 31,
2006 and otherwise shall be granted such units on such terms and pursuant to
such award agreements as provided to senior executives of the Companies
generally for AEP performance share units. As a performance share unit
participant, Executive will be subject to a stock ownership requirement
determined and periodically adjusted by the Human Resources Committee of the
Board.

3.5   Payments and Provisions in Respect of Employment.

(a) Bonus Restricted Stock. On the Commencement Date, AEP shall
grant to Executive 100,000 shares of AEP Stock ("Bonus Stock") pursuant to the
LTIP. Subject to Executive's continued employment hereunder, fifty percent (50%)
of the Bonus Stock shall vest on January 1, 2005 and the remaining fifty percent
(50%) of the Bonus Stock shall vest on January 1, 2006 and otherwise the Bonus
Stock shall be granted on such terms and pursuant to such award agreement as
provided to senior executives of the Companies generally under the LTIP.

(b) Replacement of Long-Term Incentive Awards. In consideration for Executive's
forfeiture of certain long-term incentive compensation awards, on the
Commencement Date, AEP shall grant to Executive 200,000 shares of AEP Stock
("Restricted Stock") pursuant to the LTIP. Subject to Executive's continued
employment hereunder, the Restricted Stock shall vest as to one-third of the
shares on each of November 30, 2009, November 30, 2010 and November 30, 2011,
and otherwise the Restricted Stock shall be granted on such terms and pursuant
to such award agreement as provided to senior executives of the Companies
generally under the LTIP.

4. Termination of Employment.

4.1 Termination Not for Cause. Either of the Companies may terminate Executive's
employment hereunder at any time other than for Cause (as defined in Section 4.4
hereof).

(a) If Executive's employment hereunder is terminated by the Companies other
than for Cause (as defined in Section 4.4 hereof) (and other than as a result of
Executive's death or Permanent Disability (as defined in Section 4.2 hereof))
during the term of this Agreement, Executive shall receive from Service
Corporation the following:

(1)  all "Accrued  Benefits",  which term is defined as the  following:  (x) any
     accrued but unpaid Base Salary through the date of termination,  payable in
     a lump sum promptly after such  termination  of employment;  (y) any earned
     but unpaid  Annual Bonus in respect of any  previously  completed  calendar
     year  of  the  Companies,  payable  in  a  lump  sum  promptly  after  such
     termination of employment;  and (z) such payments under  applicable  plans,
     policies and programs,  including  but not limited to those  referred to in
     Section  3.3  hereof,  to which he is  entitled  upon such  termination  of
     employment pursuant to the terms of such plans, policies or programs; and

(2)  continued payment of Base Salary,  at the rate in effect  immediately prior
     to the date of  Executive's  termination  of  employment,  for the two year
     period  immediately  following the date of such  termination of employment,
     paid in  substantially  equal  installments in accordance with the ordinary
     payroll practices of the Companies; and

(3)  subject to  Executive's  election to receive  group  health  coverage  from
     Service  Corporation under the Consolidated  Omnibus  Reconciliation Act of
     1985,  as amended,  continued  participation,  at the same level of expense
     paid by Executive prior to such termination, in all medical, dental, vision
     and hospitalization insurance programs (collectively,  the "Welfare Plans")
     in which Executive (and his eligible  dependents) were participating on the
     date of his termination  until the earlier of: (x) the first anniversary of
     the date of  termination  of  Executive's  employment  or (y) the date,  or
     dates,  Executive  becomes eligible for coverage and benefits under similar
     plans and  programs of a  subsequent  employer.  Executive  shall  promptly
     advise the Companies of any such subsequent  employment and the benefits he
     receives in connection therewith.

(b) Effect of Change in Control. Notwithstanding the foregoing, upon a
termination of Executive's employment that would entitle Executive to receive
payments and benefits under that certain Service Corporation Change in Control
Agreement for the Office of the Chairman that Service Corporation and Executive
agree to enter into on the date hereof, which agreement shall be substantially
in the form attached hereto as Exhibit B (the "Change in Control Agreement"),
Executive shall be entitled to the payments and benefits provided under the
Change in Control Agreement in lieu of the payments and benefits otherwise
provided under Section 4.1(a) to the extent applicable.

4.2 Permanent Disability. If Executive becomes totally and permanently disabled
(as defined in any long-term disability benefit plan of the Companies applicable
to senior executive officers as in effect on the date thereof) ("Permanent
Disability"), the Companies or Executive may cause Executive to be removed from
the positions held hereunder upon written notice thereof, and Executive shall
receive or commence receiving as soon as practicable: (a) amounts payable
pursuant to the terms of any disability insurance policy or similar arrangement
which the Companies maintain during the term hereof; and (b) the Accrued
Benefits, if any. In the event of a judicial determination of Executive's
incompetence, reference in this Agreement to Executive shall be deemed, where
appropriate, to refer to his legal representative.

4.3 Death. In the event of Executive's death during the term of this Agreement
hereunder, Executive's estate or designated beneficiaries shall receive or
commence receiving, as soon as practicable (a) any death benefits provided under
the employee benefit programs, plans and practices, including those referred to
in Section 3.3 hereof, in accordance with their terms and (b) any other Accrued
Benefits. In the event of Executive's death, reference in this Agreement to
Executive shall be deemed, where appropriate, to refer to his beneficiary,
estate or other legal representative, as applicable.

4.4 Discharge for Cause; Voluntary Termination by Executive. During the term of
this Agreement, (i) either of the Companies shall have the right to terminate
the employment of Executive hereunder for Cause (as defined in and in accordance
with Section 4.4(b) below) at any time and [(ii) Executive shall have the right
to terminate his employment hereunder, other than as a result of Executive's
Permanent Disability or death, at any time following at least sixty (60) days
advance written notice to the Companies of such termination.

(a) Effect of Termination. During the term of this Agreement, in the event that
Executive's employment is terminated hereunder by the Companies for Cause, or by
Executive other than as a result of Executive's Permanent Disability or death,
Executive shall only be entitled to receive any amounts to which he has a
nonforfeitable right under any employee benefit programs or plans referred to in
3.3 hereof, in accordance with their terms, and any other Accrued Benefits.
After the termination of Executive's employment under this Section 4.4(a), the
obligations of the Companies under this Agreement to make any further payments,
or provide any benefits specified herein, to Executive shall thereupon cease and
terminate.

(b) Definition of Cause. As used herein, the term "Cause" shall be limited to
(1) willful malfeasance or willful misconduct by Executive in connection with
his employment, (2) continuing refusal by Executive to perform his duties
hereunder or any direction of the Board, after notice and a reasonable
opportunity to perform such duties or direction was given to Executive by the
Board, (3) any breach of the provisions of Section 7 of this Agreement by
Executive or any other material breach of this Agreement by Executive or (4) the
commission by Executive of any misdemeanor involving moral turpitude or a
felony. Termination of Executive pursuant to this Section 4.4 shall be made by
delivery to Executive of a copy of a resolution duly adopted by the affirmative
vote of not less than a majority of the directors at a meeting of the Board
called and held for the purpose (after 30 days prior written notice to Executive
and reasonable opportunity for Executive to be heard before the Board prior to
such vote), finding that in the good faith business judgment of such Board,
Executive was guilty of conduct sat forth in any of clauses (1) through (4)
above and specifying the particulars thereof.

5. Mitigation of Damages; Offset. Executive shall not be required to mitigate
damages or the amount of any payment provided for under this Agreement by
seeking other employment or otherwise after the termination of his employment
hereunder. Notwithstanding the foregoing, any payments received by Executive
from other employment after any termination of Executive's employment hereunder
shall reduce any payments to which he would otherwise be entitled from the
Companies hereunder.

6. Notices. All notices or communications hereunder shall be in writing,
addressed as follows:

            To the Companies:

                  c/o American Electric Power Company, Inc.
                  1 Riverside Plaza
                  Columbus, Ohio 43215
                  (attn: General Counsel)

            To Executive:

                  Mr. Michael G. Morris c/o American Electric Power Company,
                  Inc. 1 Riverside Plaza
                  Columbus, Ohio 43215

Any such notice or communication shall be delivered by hand or by courier or
sent certified or registered mail, return receipt requested, postage prepaid,
addressed as above (or to such other address as such party may designate in a
notice duly delivered as described above), and the third business day after the
actual date of mailing shall constitute the time at which notice was given.

7. Nondisclosure of Confidential Information.

7.1 Nondisclosure of Confidential Information. Executive shall not, at any time
during the term of this Agreement or thereafter, without the prior written
consent of the Companies, use, divulge, disclose or make accessible to any other
person, firm, partnership, corporation or other entity any Confidential
Information (as defined below) pertaining to the business of the Companies or
any of their affiliates, except (a) while employed by the Companies, in the
business of and for the benefit of the Companies, or (b) when required to do so
by a court of competent jurisdiction, by any governmental agency having
supervisory authority over the business of the Companies, or by any
administrative body or legislative body (including a committee thereof) with
jurisdiction to order Executive to divulge, disclose or make accessible such
information. Notwithstanding anything herein to the contrary, any party to this
Agreement (and any employee, representative, or other agent of any party to this
Agreement) may disclose to any and all persons, without limitation of any kind,
the tax treatment and tax structure of the transactions contemplated by this
Agreement and all materials of any kind (including opinions or other tax
analyses) that are provided to it relating to such tax treatment and tax
structure. However, any such information relating to the tax treatment or tax
structure is required to be kept confidential to the extent necessary to comply
with any applicable federal or state securities laws. For purposes of this
Section 7, "Confidential Information" shall mean non-public information
concerning the finances, strategic business plans, product development (or other
proprietary product data), marketing plans and other non-public, proprietary and
confidential information of the Companies, their affiliates or their customers.

7.2 Restrictive Covenants. The Executive acknowledges and recognizes the highly
competitive nature of the businesses of the Companies and their affiliates and
accordingly agrees as follows:

(a) Covenant Not to Compete. During the Term of Employment and the Restricted
Period (as defined below), Executive will not directly or indirectly:

     (1)  engage  in any  business  that is a  Competing  Business  (as  defined
          below);

     (2)  enter the employ of, or render any  services  to, any person or entity
          (or any  division  of any  person  or  entity)  which  is a  Competing
          Business;

     (3)  acquire a financial interest in, or otherwise become actively involved
          with or in, any  Competing  Business,  directly or  indirectly,  as an
          individual, partner, shareholder, officer, director, principal, agent,
          trustee or consultant; or

     (4)  interfere with, or attempt to interfere with,  business  relationships
          (whether  formed  before,  on or  after  the  date of this  Agreement)
          between the Companies and any of its affiliates  and their  respective
          material customers, clients or suppliers.

(b) Permitted Activities. Notwithstanding anything to the contrary in this
Agreement, during the term of this Agreement and thereafter, Executive may: (x)
directly or indirectly own, solely as an investment, securities of any person
engaged in a Competing Business which are publicly traded on a national or
regional stock exchange or on the over-the-counter market if Executive (1) is
not a controlling person of, or a member of a group which controls, such person
and (2) does not, directly or indirectly, own one percent (1%) or more of any
class of securities of such person (excluding any interest Executive owns
through a mutual fund, private equity fund or other pooled account).

(c) Covenant Not to Solicit Employees. During the term of this Agreement and the
Restricted Period, Executive will not, whether on Executive's own behalf or on
behalf of or in conjunction with any person, company, business entity or other
organization whatsoever, directly or indirectly hire any executive or employee
who was employed by either of the Companies (or any of their major subsidiaries)
as of the date of Executive's termination of employment with the Companies or
who left the employment of the Companies coincident with, or within twelve (12)
months prior to or after, the termination of Executive's employment with the
Companies (provided that nothing herein shall prevent Executive from the general
advertising for employees or from serving as a reference for an employee of the
Companies).

(d) Definitions. For purpose of this Section 7, (1) the term "Competing
Business" shall mean any business in a geographic area in which the Companies or
any of their major subsidiaries engage, in any such case at the relevant time
during the term of employment or on the date of any termination of Executive's
employment hereunder, as applicable, and (2) the term "Restricted Period" shall
mean the period beginning on the date on which Executive's employment hereunder
terminates, for any reason, through the second anniversary of such date.


7.3   Reasonableness of Covenants; Remedies.

(a) Reasonableness of Covenants. Executive and the Companies agree that the
foregoing nondisclosure and other restrictive covenants are reasonable covenants
under the circumstances, and further agree that if in the opinion of any court
of competent jurisdiction any such restraints are not reasonable in any respect,
such court shall have the right, power and authority to excise or modify such
provision or provisions of these covenants as to the court shall appear
reasonable and to enforce the remainder of the covenants as so amended.

(b) Remedies. Executive agrees that any breach of the covenants contained in
this Section 7 would irreparably injure the Companies. Accordingly, Executive
agrees that (1) Service Corporation may cease any payments being made under
Section 4 of this Agreement and/or (2) either of the Companies may, in addition
to pursuing any other remedies it may have in law or in equity, obtain an
injunction against Executive from any court having jurisdiction over the matter
restraining any further violation of this Agreement by Executive.

8. Withholding Taxes. The Companies may withhold from any amounts payable under
this Agreement to Executive such Federal, state, local and other taxes as may be
required to be withheld pursuant to any applicable law or regulations.

9. Governing Law; Resolution of Disputes.

9.1 Governing Law. This Agreement shall be construed, interpreted and governed
in accordance with the laws of the State of Ohio, without reference to rules
relating to conflicts of law.

9.2 Resolution of Disputes. Subject to the provisions of Section 7.3, any
disputes arising under or in connection with this Agreement shall be resolved by
binding arbitration, to be held in Columbus, Ohio, in accordance with the rules
and procedures of the American Arbitration Association. Judgment upon the award
rendered by the arbitrator(s) may be entered in any court having jurisdiction
thereof. Each party to this Agreement shall bear his or its own costs of the
arbitration.

10. Entire Agreement; Amendments.

10.1 Entire Agreement and Effect on Prior Agreements. This Agreement contains
the entire understanding between the parties hereto and supersedes in all
respects any prior or other agreement or understanding between the Companies or
any affiliate of the Companies and Executive.

10.2 Amendments and Waivers. No provision in this Agreement may be amended
unless such amendment is agreed to in writing and signed by Executive and an
authorized officer of either of the Companies. No waiver by any party hereto of
any breach by another party of any condition or provision contained in this
Agreement to be performed by such other party shall be deemed a waiver of a
similar or dissimilar condition or provision at the same or any prior or
subsequent time. Any waiver must be in writing and signed by Executive or an
authorized officer of either of the Companies, as the case may be.

11. Severability; Survivorship.

11.1 Severability. In the event that any provision or portion of this Agreement
shall be determined to be invalid or unenforceable for any reason, in whole or
in part, the remaining provisions of this Agreement shall be unaffected thereby
and shall remain in full force and effect to the fullest extent permitted by law
so as to achieve the purposes of this Agreement.

12. Survivorship. Except as otherwise expressly set forth in this Agreement, the
respective rights and obligations of the parties hereunder shall survive any
termination of Executive's employment. Upon the expiration of the term of the
Agreement, the respective rights and obligations of the parties shall survive
such expiration to the extent necessary to carry out the intentions of the
parties as embodied in the rights (such as vested rights) and obligations of the
parties under this Agreement.

13. Assignment. This contract shall be binding upon and inure to the benefit of
the heirs and representatives of Executive and the assigns and successors of the
Companies, but neither this Agreement nor any rights or obligations hereunder
shall be assignable or otherwise subject to hypothecation by Executive (except
by will or by operation of the laws of intestate succession) or by either of the
Companies, except that either of the Companies may assign this Agreement to any
successor (whether by merger, purchase or otherwise) to all or substantially all
of the stock, assets or businesses of the Companies, if such successor expressly
agrees to assume the obligations of the Companies hereunder.

14. Counterparts. This Agreement may be executed in two or more counterparts,
each of which will be deemed an original.


      IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first written above.

                             AMERICAN ELECTRIC POWER COMPANY INC.

                             By /s/ John P. DesBarres
                                Name:  John P. DesBarres
                                Title:   Chairman, Human Resources
                                         Committee of American Electric
                                         Power Company


                             AMERICAN ELECTRIC POWER SERVICE CORPORATION

                             By /s/ John P. DesBarres
                                Name:  John P. DesBarres
                                Title:   Chairman, Human Resources
                                         Committee of American Electric
                                         Power Company

                             EXECUTIVE

                               /s/ Michael G. Morris
                                Michael G. Morris


<PAGE>

                                                                     EXHIBIT A

                             AMERICAN ELECTRIC POWER

                                   RELOCATION
                                 EXPENSE POLICY
                                   GUIDELINES

                                       FOR

                              **EXEMPT EMPLOYEES**
                                       and
                           **NON-EXEMPT SUPERVISORS**
                                       and
                        **NEWLY HIRED EXEMPT EMPLOYEES**
                           SALARY GRADES 26 AND ABOVE




                              EFFECTIVE MAY 1, 2002
                             (Revised March 1, 2003)


<PAGE>


                             AMERICAN ELECTRIC POWER
                      RELOCATION EXPENSE POLICY GUIDELINES
                  FOR EXEMPT EMPLOYEES & NON-EXEMPT SUPERVISORS
          AND NEWLY HIRED EXEMPT EMPLOYEES -SALARY GRADES 26 AND ABOVE
                  Effective May 1, 2002 (Revised March 1, 2003)


   THIS RELOCATION POLICY AND OTHER USEFUL INFORMATION ON YOUR RELOCATION IS
   AVAILABLE ON-LINE AT WWW.SIRVARELOCATION.COM. THIS IS THE WEBSITE OF SIRVA
Relocation (SIRVA), AEP'S RELOCATION VENDOR. YOU WILL BE EMAILED A USER LOGIN ID
AND PASSWORD AT THE ONSET OF YOUR RELOCATION. PLEASE VISIT THIS SITE FOR ANSWERS
                TO YOUR QUESTIONS AND OTHER HELPFUL MOVING TIPS.


  PLEASE DO NOT CONTACT ANY REAL ESTATE AGENTS OR SIGN ANY LISTING AGREEMENTS,
    CONTRACTS OR OTHER DOCUMENTS PRIOR TO SPEAKING WITH YOUR DESIGNATED SIRVA
                              RELOCATION COUNSELOR.


<PAGE>


                                TABLE OF CONTENTS

ARTICLE I.  ELIGIBILITY

      A. Current Employees (Exempt Employees & Non-Exempt Supervisors)
      B. Newly Hired Exempt Employees in Salary Grades 26 & Above

ARTICLE II. MARKETING AND DISPOSAL OF PRESENT RESIDENCE

      A.    Home Defined
      B.    Home Sale Assistance
                1. Marketing Assistance Program
                2. Marketing Assistance Program Bonus
                3. Safety-Net
                4. Guaranteed Purchase Offer
                5. Vacate Date
                6. Negative Equity
                7. Cost of the Home Sale Program
                8. Selling Home Outside the Home Sale Assistance Program
      C. Loss on Sale Protection
      D. Lease Agreements
      E. Land Contracts
      F. Mobile Homes

ARTICLE III. NEW RESIDENCE

      A. Lump Sum Payment - House Hunting/Temporary Living/Return Trips
      B. Final Move Expenses
      C. Miscellaneous Expense Allowance (Current AEP Employees Only)
      D. Duplicate Housing Expenses
      E. Equity Loan
      F. Movement of Household Goods

ARTICLE IV. MORTGAGE ASSISTANCE

      A.    Point Reimbursement Payments
      B.    Mortgage Companies

ARTICLE V.  TAXABILITY OF REIMBURSED EXPENSES

      A.    IRS 50-Mile Test
      B.    Tax Allowance/Gross Up

ARTICLE VI. ADMINISTRATION OF POLICY

ATTACHMENT I - EQUITY LOAN AGREEMENT and PROMISSORY NOTE

ATTACHMENT II - RELOCATION SERVICES EMPLOYMENT CONTRACT
                (Newly Hired Exempt Employees Only)


<PAGE>

The AEP relocation policy provides for reimbursement of certain, designated
expenses which are directly related to the domestic relocation of an eligible
employee who is requested by the Company to relocate to a new work location. The
policy is designed to help relieve employees of the financial and physical
burdens which normally accompany a relocation. Through close adherence to the
policy, efficiency and consistency of all employee relocations can be assured.

ARTICLE I.    ELIGIBILITY

A.    Current Employees

      Regular, full time exempt employees and non-exempt supervisors are
      eligible for full coverage and all benefits under the relocation policy.

      Employees are eligible for benefits under this policy provided:

      1.    The relocation is considered permanent or indefinite (i.e., there is
            no predetermined intention to return or transfer the employee back
            to the previous location or to another location within a one-year
            period), and

      2.    The Company requests the employee to relocate.

B.    Newly Hired Exempt Employees in Salary Grades 26 and Above

      Newly hired exempt employees in salary grades 26 and above are eligible
      for full coverage and all benefits under the relocation policy except the
      Miscellaneous Expense Allowance. The new employee will be required to
      enter into a RELOCATION SERVICES - EMPLOYMENT CONTRACT (Attachment II)
      with the Company whereby he/she agrees that upon voluntary termination
      from the Company within one year of employment he/she will upon request
      from the Company be required to reimburse the Company for all payments
      made to him/her or in his/her behalf except those made pursuant to article
      III, sections A and E.

ARTICLE II.   MARKETING AND DISPOSAL OF PRESENT RESIDENCE

The Company has contracted with SIRVA Relocation (SIRVA) an international
relocation services firm, to assist relocating employees in finding potential
buyers for their homes. If these efforts prove unsuccessful, SIRVA will also
offer to purchase the homes of employees, subject to the property meeting
SIRVA's minimum requirements, as described on page 6. In addition, SIRVA will
assist the employee in locating a home for purchase at the new work location
area (Destination Services). SIRVA will also provide assistance in the movement
of the household goods through its Moving Services unit (see Article III-E).

      The home marketing and disposal benefit assists a transferring employee in
      finding a suitable buyer who is willing to pay at or near the most
      probable sales price for the home, and disposing of his/her home in the
      most efficient possible manner. An eligible employee has the option of:
      (1) selling the home under the Home Sale Assistance Program as described
      in Section B below; or (2) attempting to sell the home on his/her own
      outside the Home Sale Assistance Program.

      In order to maximize your relocation benefits do not contact any real
      estate agents prior to your initial contact with your individual
      Relocation Counselor at SIRVA Relocation (SIRVA). SIRVA will provide you
      with a list of qualified agents who specialize in relocation moves in your
      area. From this list, you may choose the agent with whom you would like to
      list the property. If you choose an agent that is not on SIRVA's approved
      list, the agent must be qualified in advance and agree to pay a referral
      fee to SIRVA.

A.       Home Defined

         Home shall mean improved real estate:

     1.   which is,  at the  issuance  by the  Company  of the SIRVA  relocation
          assistance   authorization,   employee-owned   and  occupied  primary,
          single-family residence,  townhouse;  two-family (duplex) provided the
          employee  resides in one unit, or condominium  unit provided said unit
          meets FNMA (Fannie Mae) / FHLMC (Freddie Mac) approval.  Excluded are:
          any income producing properties;  resort properties;  mobile homes not
          permanently  affixed to the  property  (See  Article  II,  Section F);
          cooperative units;  farms; homes with acreage that does not conform to
          the  immediate  area;  properties  on  which  clear  title  cannot  be
          delivered;  properties which do not qualify for conventional  mortgage
          financing;  properties  that have black mold;  properties that have an
          unresolved  EIFS  exterior  finishing  problem;  properties  in  which
          inspections  conducted  disclose  defects which  rendered the property
          unmarketable  and/or the employee does not repair to the  satisfaction
          of Supplier.

     2.   which shall  include only the items of personal  property set forth in
          the Contract of Sale;

     3.   with respect to which all  mortgages  can be prepaid.  If a prepayment
          penalty is required, it must not exceed the greater of:

                o     one percent (1%) of the original loan, or
                o     six months interest on the principal balance prepaid

     4.   with respect to which  insurance  is  available at standard  rates for
          normal hazards of fire and extended coverage;

     5.   with  respect to which all leases can be  terminated  by SIRVA with no
          more than a (60) sixty-day notice to the lessor;

     6.   which is not situated on or near and does not contain any hazardous or
          toxic  materials  or gases,  including  but not limited to black mold,
          asbestos,  lead paint,  radon gas, urea  formaldehyde  foal insulation
          (UFFI),  or an unresolved  exterior  insulating  and finishing  system
          problem (EIFS);

     7.   which contains  acreage (lot size) within the norm and specific zoning
          limits for that particular locale or neighborhood.  If there is excess
          acreage,  SIRVA  will  not  purchase  more  than is  considered  to be
          necessary to make the residence salable;

     8.   in which the employee has clear and marketable title;

     9.   which has all the  normal  characteristics  of a home such as  potable
          running water, sewage or septic system, electricity, etc., and

     10.  which has been repaired by the employee or where repairs are necessary
          as a result of inspections or appraisals.

B.       Home Sale Assistance

      An eligible employee who owns a home at the former location, which meets
      the above definition, may elect to sell the home through the Home Sale
      Assistance Program offered by SIRVA. SIRVA will be authorized to contact
      the employee by the Company at the onset of the move to start the Home
      Sale Program as well as other relocation benefits.

      1.    Marketing Assistance Program

      All qualified relocating employees are eligible to participate in the
      Marketing Assistance Program offered by SIRVA. The Marketing Assistance
      Program is designed specifically to assist employees in finding potential
      buyers for their homes. Employees are required to market their home for a
      ninety (90) day marketing period before they may accept the Guaranteed
      Purchase Offer described below.

      SIRVA's assistance includes the selection of relocation specific Realtors,
      assistance in effectively pricing the employee's home for sale, the
      development of an effective marketing plan and the tax-efficient purchase
      of the employee's home by SIRVA, at acceptable price, terms and conditions
      to the employee. With SIRVA's help:

     --   The employee should sell their home quickly at the highest  attainable
          market price (The best  opportunity  to maximize the asking price of a
          home is during the first 30 days of listing,  when  market  excitement
          about the home is highest and buyer traffic is at its greatest.)

     --   The  employee  will not incur  any  costs of sale such as  commissions
          and/or statutory closing costs. These costs will be incurred by SIRVA.

     --   The employee is not  required to attend the ultimate  closing on their
          old home.

     --   The employee is protected from contracts or buyers that "fall-through"
          once SIRVA has committed to buy the home. If the ultimate market buyer
          fails to close on the purchase of the employee's home, SIRVA is solely
          responsible for the disposal of the property.

      IMPORTANT: In order to preserve their relocation benefits, employees
      should not make any agreement or sign any document or accept any money
      before speaking with their Relocation Counselor at SIRVA to discuss the
      home sale process.

      To be eligible for the benefits described above, the employee must fully
      comply with the guidelines set forth below:

     --   The  employee  agrees to execute  the SIRVA  Option  Agreement,  which
          details the terms and conditions under which SIRVA will purchase their
          home.

     --   The employee agrees to work with SIRVA  recommended real estate agents
          for home listing and at the employee's option, for home finding in the
          new location.

     --   The  employee  agrees to allow  SIRVA to market the home at a price no
          greater than 105% of the most  probable  selling price as indicated by
          the average of at least two Broker Price Opinions  (BPO's) rendered by
          two independent realty agents approved by SIRVA.

     --   The employee  agrees to cooperate  with their chosen  listing agent in
          showing the  property to  prospective  buyers and with any  inspectors
          authorized by SIRVA and/or a prospective buyer.

      Additionally, an employee's property must qualify for the home sale
      program. The employee must also disclose any known defects to the property
      that may affect its marketability. The SIRVA Relocation Counselor will
      help evaluate a property's eligibility, provide more detail, and answer
      all questions that may arise.

      Once the employee executes the Option Agreement and agrees to a suitable
      list price for their home, SIRVA will handle all the administrative
      details of marketing the home during the 90 day marketing period. The
      SIRVA Relocation Counselor will discuss with the employee all market
      offers and will negotiate the highest attainable price for the home, which
      will represent the fair market value at which SIRVA will exercise its
      option to purchase the employee's home. Once the employee agrees to the
      fair market value, the employee will enter into a binding contract with
      SIRVA and a date at which the employee will receive the proceeds of the
      sale will be established.

      The employee's equity will be computed and expenses prorated as of the
      date SIRVA accepts the contract of sale or vacating date, whichever is
      later. SIRVA will then complete the sale with the buyer. The homesale
      process is considered final once it is determined that the buyer has been
      financially qualified to purchase the employee's home, inspections by the
      buyer have been completed and addressed, and all contracts have been
      approved by SIRVA, regardless of whether SIRVA is able to complete the
      sale to the buyer.

      2.    Marketing Assistance Program Bonus

      Employees in the Marketing Assistance Program will receive a bonus of the
      greater of two percent (2%) of the selling price, or $1,000, if the
      outside offer is determined to be acceptable by SIRVA. Employees who do
      not use the Marketing Assistance Program are not eligible for this
      benefit.

      The 2% Bonus payment will be made to the employee by The Company when the
      homesale process between the employee and SIRVA is considered final, and
      will not be contingent on whether SIRVA is able to complete the sale with
      the buyer. The payment will be considered ordinary income and will NOT be
      grossed up for tax purposes.

      3. Safety Net

      In the possible event the employee is unable to find a buyer for his/her
      home, the Company will also authorize SIRVA to prepare a back-up home
      purchase offer as described in the Guaranteed Purchase Offer section
      below.

      4.    Guaranteed Purchase Offer

      After discussing the Marketing Assistance Program with the employee, a
      SIRVA Relocation Counselor will provide a list of up to four (4)
      qualified, licensed independent real estate appraisers from their
      nationwide network to perform an ERC Relocation Appraisal on their home.
      Upon receipt, the employee will need to select two (2) appraisers from the
      list and notify their SIRVA counselor who will work with the employee to
      arrange an appointment for the evaluation of their home. After the two
      appraisers inspect the employee's home, they will prepare their
      independent appraisal reports and determine an appraised value price for
      the home. The appraisal process documents the price an educated and
      knowledgeable buyer would pay for a home and the price at which an
      educated and knowledgeable seller agrees to sell the home. Research,
      comparable listings and sales, and a normal ninety-day (90) marketing
      period are used in this determination.

      The appraisals will be submitted to SIRVA for review. If the appraisal
      values are found to be accurate by SIRVA, the two appraisals will be
      averaged together and the resulting amount will become the employee's
      "Guaranteed Purchase Offer." SIRVA will offer to purchase the employee's
      home at this value after 90 days of mandatory home marketing, if the home
      has not already sold. SIRVA will notify the employee by telephone of the
      offer and confirm the offer in writing. The employee has sixty (60) days
      from the 90th day of initial home listing to accept SIRVA's offer.

      If the two appraisals are not within a 5% variance of each other, a third
      appraisal will be ordered and the closest two shall be averaged to come up
      with the employee's "Guaranteed Purchase Offer."

      At day 60 of the home marketing time, reasonable and necessary
      inspections, including but not limited to, a home inspection, structural,
      roof, pest and radon inspections will also be obtained by SIRVA at this
      time. The employee is solely responsible for rectifying or repairing any
      adverse items that appear on any of the inspections obtained by SIRVA,
      before SIRVA will be obligated to purchase the employee's home.

      5.    Vacate Date

      The employee remains responsible for mortgage, taxes, insurance,
      maintenance, utility payments and other homeowner expenses until either
      the date the property is vacated or the date a new residence is purchased.
      (See Article II.D - Duplicate Housing) The vacating date normally will not
      be later than sixty (60) days from the date the employee accepts the offer
      by SIRVA; however, in unusual cases, extensions may be granted with prior
      approval from Human Resources.

      6.    Negative Equity

      In those cases where there is a Negative Equity situation (i.e. employee
      mortgage balance is greater than SIRVA's purchase offer/Guaranteed
      Purchase Offer), the employee must pay the difference between the mortgage
      balance and the Guaranteed Purchase Offer to SIRVA at the time of closing
      and sale of the property to SIRVA, should he/she accept SIRVA's purchase
      offer. Failure to make this payment to SIRVA will result in the withdrawal
      of SIRVA's Guaranteed Purchase Offer. Please see Article II, Section C for
      Loss on Sale Protection.

      7.    Cost of the Home Sale Program

      The cost of the Home Sale Program will be paid by the Company.

      8. Selling the Home Outside the Home Sale Assistance Program

      An employee who otherwise qualified for the Home Sale Assistance Program
      and elects to sell his/her home without the aid of SIRVA will be
      reimbursed by the Company for the following closing expenses:

          o    Broker's commission

          o    Reasonable  and customary  seller  closing costs and legal fees o
               Transfer charges and transfer taxes

          o    Mortgage prepayment penalties as per Article II, Section B.3 (but
               not points)

          o    Taxes other then those  incurred due to gain on sale or pro-rated
               property taxes

      No Guaranteed Purchase Offer will be available to employees who elect to
      sell their home outside the Home Sale Assistance Program.

C. Loss on Sale Protection (Grossed-Up)

      Employees may occasionally find that real estate conditions force them to
      sell their residence for less than it cost them. This feature is designed
      to lessen the impact of such a financial loss. Under these circumstances,
      the Company will pay the difference between the sales' price to an outside
      buyer or the Guaranteed Price Offer (whichever is applicable), and the
      original property purchase price (plus documented expenditures for labor
      and material used in IRS eligible capital improvements). This payment is
      limited to no more than 10% of the Guaranteed Purchase Price.

      In order to be eligible for this benefit, the following conditions and
      limitations apply:

     o    The employee must have owned and occupied  their  single-family  home,
          townhouse,  or  condominium  located  in the  United  States  as their
          primary  place  of  residence  on the  date  first  notified  of their
          transfer.

     o    If  the  home  is on  large  acreage  or is  partially  an  investment
          property, loss on sale will be prorated on the basis of the percent of
          total value the residence portion represents.

     o    If the employee shares  ownership in the home with anyone other than a
          spouse, they must own at least 50% or more of the residence to receive
          any  assistance.  The  assistance  will be  prorated  based  on  their
          percentage of ownership.

     o    Mobile, modular and certain manufactured homes are not eligible except
          as noted in Article II, Section F.

     o    Capital  improvements  are limited to those  deemed  allowable  by the
          Internal Revenue Service (IRS).

     o    Charges for  interest on loans,  labor  performed  by the  employee or
          his/her family members are not eligible.

     o    Repairs are not eligible.

      The Original purchase price documents plus all documentation for allowable
      capital improvements must be presented by the employee to their SIRVA
      Relocation Counselor. After the SIRVA review, a final review by AEP's tax
      department will be made before authorization. Under no circumstances will
      payment be made before the home is sold or acquired by SIRVA. This amount
      will be grossed up for income taxes.

D.    Lease Agreement

      An eligible employee renting his/her primary residence at the time of
      relocating who cannot cancel a lease arrangement without being assessed a
      penalty, shall be reimbursed by the Company for up to a two-month lease
      penalty and loss of deposit for canceling the lease. A copy of the lease
      agreement, indicating the penalty, and a paid receipt are required for
      reimbursement.

E.    Land Contracts

      For those eligible employees who have entered into a Land Contract
      agreement, the Home Sale Assistance Program is not available unless the
      employee is able to provide a clear title to the property or acceptable
      termination procedures are included with the Land Contract agreement.

F.    Mobile Homes

      When a mobile or pre-manufactured home is on property owned by the
      employee, is affixed to the property by being on a permanent concrete
      footer and poured concrete blocks (wheels, axle, and tongue removed), has
      all required utilities connected, meets FNMA/FHLMC financing criteria and
      meets criteria for conventional mortgage financing (such as having a
      perimeter block foundation), the Home Sale Assistance portion of the
      Relocation Policy will apply. If a mobile or pre-manufactured home does
      not meet the criteria described above, special arrangements may be made to
      assist the employee with the sale of their home.

      If a mobile or pre-manufactured home has not become affixed to property
      owned by the employee as described above, the Company will pay for the
      tear down, transportation and set up of the mobile home. In this type of
      situation, the Company does not buy the mobile home, but will reimburse
      the employee for sales commission and selling expenses if the employee
      sells the mobile home. Under no circumstances, will the Company purchase
      vacant land.

ARTICLE III.      NEW RESIDENCE

The employee will receive professional assistance from SIRVA in locating homes
in the destination location that meet the employee's needs. The Relocation
Counselor will help the employee assess preferences, describe the assistance
available and arrange for a free mortgage financing pre-qualification and
consultation prior to the first home finding trip. The employee's Relocation
Counselor will arrange appointments with one or more SIRVA designated Realtors
to personally assist with area orientation and home shopping.

In an effort to improve the quality of real estate agent selection and control
costs, AEP is using a "Broker Registration" program with SIRVA. If the employee
wants to use an agent outside of SIRVA's recommendation, the employee must
register their agent choice with the SIRVA Relocation Counselor. All brokers
selected will be responsible for paying a referral fee to SIRVA.

A. The Lump Sum Payment (Grossed-Up)

      The Company will provide a Lump Sum Payment to cover expenses related to
      House Hunting, Return Trips Home and Temporary Living, (e.g. travel,
      mileage, rental car, lodging, meals, telephone, parking, tolls,
      babysitting, and other miscellaneous expenses). Payment of this Lump Sum
      will generally be made within one month of the payroll transfer date to
      the new work location. The amount of the payment will vary depending on
      the distance from the employee's former home to the new work location as
      follow:

      Long Move (50 or more miles)        $ 6,000     (less FICA taxes)
      Short Move (less than 50 miles)     $ 2,500     (less FICA taxes)

      Note: For those transferees too far away to drive (normally 350 miles),
      the reasonable cost of air-fare will be reimbursed in addition to the Lump
      Sum Payment allowance, with prior approval.

      The employee's FICA expense on this payment will be withheld providing the
      employee does not exceed the FICA income base in the year of the move.

      Employees are also eligible for up to 5 days off with pay for house
      hunting trips and up to 3 days off with pay for the final move trip to the
      new work location, as needed. Additional time off with pay may be
      available at the discretion of the supervisor.

      The SIRVA Relocation Counselor will explain all the details of the expense
      reimbursement process for the following benefit areas including Selling
      The Home Outside the Home Sale Assistance Program, Loss on Sale
      Protection, Lease Break Assistance, The Lump Sum Payment, Final Move
      Expenses, The Equity Loan, Home Purchase Expense (where applicable),
      Duplicate Housing Expenses, Miscellaneous Expense Allowance and other
      potential expenses.

B.    Final Move Expenses

      The employee will be reimbursed for transportation expenses related to
      their final move to the new location. Mileage will be paid at the current
      Company mileage rate. Expense coverage for the final move consists of
      reasonable meals and lodging for the employee and their family for one day
      prior to the departure to the new location, number of days en route (no
      vacation or sight-seeing) and arrival day. The employee should submit ALL
      receipts on the appropriate Relocation Expense form supplied by the
      Company.

      Note: Reimbursement for local mileage prior to departure day at the former
      location and after arrival day at the new location is NOT reimbursable.
      Meals and mileage reimbursement in excess of 12 cents per mile are
      included in the employee's earnings for income tax purposes and will be
      included in amounts reported as income on the employee's W-2 form. The
      Company will gross-up these expenses.

      Other travel expenses, including transportation and lodging are excluded
      from taxable income and, therefore, will not be tax assisted.

C. Miscellaneous Expense Allowance (Current AEP Employees Only)

      A payment to current AEP employees of an amount equal to 100% of one
      month's salary (based on the salary at the new location), up to a maximum
      of $5,000, will be made by the Company. This payment is intended to help
      cover expenses the employee incurs in moving to the new location beyond
      the expenses specifically covered in this policy. This payment will be
      grossed-up for income taxes and the employee's FICA expense on this
      payment will be withheld providing the employee will not exceed the FICA
      income base in the year of the move.

D.    Duplicate Housing Expenses

      Homeowners - After an employee closes on his/her new residence, and if the
      employee has not sold his/her former home and is still paying a mortgage
      on his/her former home, the Company will reimburse the employee for the
      interest portion of the monthly mortgage payments of the former home for a
      period of up to sixty (60) calendar days from the date of closing on
      his/her new home.

      Whether or not the employee had a mortgage on his/her home, the Company
      will also reimburse the employee for real estate taxes, property
      insurance, utility expenses, and a reasonable amount for lawn care and/or
      snow removal. This reimbursement for duplicate residence expenses is
      available for a period up to sixty (60) calendar days from the date of
      closing on his/her home at the new location.

      Employee must be actively marketing former residence in order to be
      eligible for duplicate housing expense reimbursement.

E.    Equity Loan

      Upon entering into a purchase contract on a new residence, the employee
      can apply for an equity loan, interest free for 90 days, in an amount
      equal to SIRVA's Guaranteed Purchase Offer less any remaining mortgage
      balances, less four percent (4%) of the Guaranteed Purchase Offer held
      back for contingencies. An equity loan is available for the sole purpose
      of purchasing a home or initiating construction at the new location. This
      loan is available whether the employee sells his/her home to SIRVA or
      whether he/she tries to sell it himself/herself. If the employee
      eventually sells the property to SIRVA, the loan amount is deducted from
      the final equity due the employee from SIRVA. Any remaining balance of the
      four percent (4%) holdback not used for contingencies (taxes, interest,
      liens, etc.), is also paid to the employee when the property is sold.

      The employee is required to sign the SIRVA Mortgage Equity Loan Agreement
      and a Promissory Note to secure an equity loan.  (See Attachment I)

      The equity loan, which is secured by the Promissory Note, will require
      repayment by the employee of the principal, as well as any costs incurred
      by SIRVA in collecting the Promissory Note, should the employee default
      (i.e., legal costs, collection, termination).

      Executive Officers and Directors of American Electric Power Company, Inc.
      (AEP) or any AEP subsidiary with publicly registered securities are not
      eligible to participate in this program.

F.    Movement of Household Goods

      The Company has contracted with SIRVA to provide experienced, efficient
      moving of all furniture and household effects to the residence at the new
      work location. The employee will be contacted by SIRVA's Moving
      Coordinator once authorization has been given by the Company. The Move
      Coordinator will assign a designated relocation van line to personally
      assist the employee with their move.

      1. The services provided by the SIRVA designated van line are:

          a.   Shipment,  packing and  unpacking of all  furniture and household
               goods.  (One  extra  pickup  and  delivery  en  route  to the new
               location will also be provided if needed.) Within one week of the
               move-in date,  the van line will return to pick up packing boxes,
               if  necessary.  Shipment  from  temporary  residence to permanent
               residence  would be  considered as a local move and would require
               management approval.

          b.   All  insurance  premiums to cover loss or damage to furniture and
               household goods caused by fire, theft,  collision, or water while
               in transit  and/or  storage on a replacement  value basis or less
               based on the weight of the  shipment.  The limit of  coverage  is
               $100k,  without a declaration  by the employee of greater  value,
               which will require an added premium.

          c.   Storage of  furniture  and  household  goods for up to sixty (60)
               calendar  days and  delivery out of storage.  Extensions  of this
               60-day  limitation must be approved by Human  Resources.  Storage
               means at the moving  company's  facility only and delivery out of
               storage means one movement only.

          d.   Major appliance disconnection and reconnection. The van line will
               transport items such as waterbeds,  pool tables,  satellite discs
               and swing sets,  but will not  disassemble  or  reassemble  these
               items.

          e.   Shipping  of  personal  vehicles  (one  car if move  is over  500
               miles), boats 14 feet and less (including trailer),  motorcycles,
               riding mowers/garden tractors and snowmobiles, with the number of
               each within reason for the size of the family.  A second personal
               vehicle may be shipped if approved by management.

      2. The van line is not authorized to ship:

          a.   Any animals (including house pets)

          b.   Trailers, campers or boats longer than 14 feet in length

          c.   Farm or heavy machinery

          d.   Furnishings from a second home

          e.   Firewood,   building  materials,   paint,  chemicals,   toxic  or
               flammable materials.

ARTICLE IV. MORTGAGE ASSISTANCE

      A.    Point Reimbursement Payments

      The Company will reimburse an employee for discount point(s) paid to
      reduce the interest rate on a mortgage obtained at the new location as
      follows:

            If 30-year rates are:         -REIMBURSE:

            8.0% or lower                 0 POINTS
            8.01% - 9.0%                  1 POINT
            9.01% - 10.0%                 2 POINTS
            Over 10.01%                   3 POINTS

     The 30-year  rate for a given month will be the Federal  National  Mortgage
     Association  (Fannie Mae) posted yield on 30-year mortgage  commitments for
     delivery  within 30 days as  indicated  in the Wall  Street  Journal on the
     first  working  day of each  month.  The  30-year  rate and  related  point
     reimbursement  amount will be determined as of the date the employee  locks
     in a mortgage rate with the new lender.

      B.    Mortgage Companies

      As part of the relocation program, AEP has contracted with SIRVA Mortgage
      and Huntington National Bank, to provide mortgage programs to help
      employees purchase homes in an efficient and economical manner. Although
      AEP is contracted with SIRVA Mortgage and Huntington National Bank,
      employee is under no obligation to use either lender. Employee may utilize
      a lender of their choice and receive reimbursement of normal and customary
      closing costs.

      SIRVA Mortgage offers a variety of loan products from prominent national
      lenders. SIRVA Mortgage will shop these lenders for you to find the best
      rate, product and program for your budget.

      A SIRVA Mortgage loan counselor will contact the employee to discuss loan
      options and the various lenders within this program. SIRVA Mortgage can be
      reached at 1-800-531-3837 or their website at www.sirva.com. Although the
      employee is under no obligation to utilize SIRVA Mortgage, it should prove
      more beneficial to the employee to do so.

      SIRVA's No Closing Cost Loan Program - Non-recurring closing costs
      normally paid by the employee are eliminated through a no-closing cost
      loan program provided to the Company by SIRVA in conjunction with SIRVA
      Mortgage. SIRVA's mortgage program eliminates the need for the employee to
      turn in a HUD-1 Settlement Statement for reimbursement and saves the
      company valuable tax gross-up dollars.

      Under SIRVA's program, the employee will be responsible for non-recurring
      costs such as prepaid interest, real estate taxes, and private mortgage
      insurance (PMI).

      o    Purchase  must  occur  within  12  months  of the  effective date of
           relocation

      o    Purchase must be permanent residence of the associate and his family

      o    Does not apply to mobile homes or boats

      Executive Officers and Directors of American Electric Power Company, Inc.
      (AEP) or any AEP subsidiary with publicly registered securities are not
      eligible to participate in this program.

      Huntington National Bank's Loan Program - AEP has also contracted with
      Huntington National Bank to provide alternative mortgage options.
      Huntington's loan program will cover normal and customary closing costs
      normally incurred by the employee. These costs are generally appraisal
      fees, credit report fees, title search, buyer paid title costs, required
      attorney's fees, statutory taxes/stamps and reasonable inspection costs.

      Should the employee choose Huntington for their mortgage, Huntington will
      advance to closing all of the reimbursable costs listed above. This
      service eliminates the need for the employee to have or to seek extra
      funds to have on hand in order to close. Nor will the employee need to
      submit an expense request, as Huntington will directly bill the Company
      for the appropriate costs. (This expense is taxable to the employee and
      will be grossed-up for income tax liability. Employee will be notified of
      their FICA tax liability for this expense.)

      The employee can contact Huntington National Bank by calling
      1-800-228-5576 or refer to their website at www.huntington.com

      An employee utilizing a lender other than SIRVA Mortgage or Huntington
      National Bank must provide a copy of their HUD-1 Settlement Statement in
      order to be reimbursed the normal and customary closing costs. (This
      expense is taxable to the employee and will be grossed-up for income tax
      liability when check is issued, and FICA tax on this amount and the
      gross-up will be withheld.)

      Executive Officers and Directors of American Electric Power Company, Inc.
      (AEP) or any AEP subsidiary with publicly registered securities are not
      eligible to participate in this program.

ARTICLE V.        TAXABILITY ON REIMBURSED EXPENSES

All reimbursements of moving expenses other than certain costs of moving
household goods and 30 days of household goods storage must be reported on the
employee's W-2 as other compensation at the end of the year in which such
reimbursements were received. The Company is required to withhold at statutory
rates for all federal/state/local taxes and FICA (Social Security) up to the
designated yearly base.

A.     IRS 50-Mile Test

      If a move meets the IRS 50-mile test, the payment for the transportation
      of household goods is excluded from the employee's income. If the move
      fails the IRS - 50 mile test, the payment for the transportation of
      household goods and 30 days of storage are included in the employee's
      income. To meet the IRS 50 - mile test, the employee's new work location
      must be at least 50 miles farther from their former residence than was
      their former work location. (It should be noted that the distance
      calculation for the IRS 50 - mile test is different than the Company's
      distance calculation used to determine the amount of the Lump Sum Payment
      for the less than 50 mile transfer described in Article II. Section A.)

B.    Tax Allowance/Gross-Up

      The Company will pay to the appropriate taxing authorities on behalf of
      the employee a tax allowance approximating the federal, state, and local
      income taxes (there will be no tax allowance for any additional FICA
      taxes) imposed as a result of the employee receiving from the Company the
      following benefits: (1) the one-month salary allowance, (2) the lump sum
      payment [which covers house hunting, return trips home and temporary
      living, (3) the cost of settling any leases; (4) reimbursement of closing
      expenses on the old residence if the employee sells the home without
      SIRVA's assistance, (5) the payment for closing costs on the home
      purchased at the new location if necessary, (6) the Loss on Sale
      Protection payment, if any, and (7) certain duplicate housing expenses.

      In the case of a move that fails the IRS - 50 mile Test, the tax allowance
      will also cover cost of moving household goods and storage. The tax
      allowance itself is additional gross income to the employee, so the
      allowance will be "grossed up" to cover the additional tax resulting from
      the tax allowance.

      The tax allowance will be calculated on the basis of: (1) the employee's
      annualized compensation from the Company less the amount the employee is
      contributing through the Tax Deferral Option of the Savings Plan, (2) the
      standard deduction and the portion of the moving expenses which qualify as
      itemized deductions, and (3) the number of exemptions the employee is
      entitled to claim on his/her federal income tax return (regardless of the
      number claimed on his/her W-4 statement). In addition, only the Company's
      W-2 source income will apply as the base for the Tax Assistance. No
      outside income such as that from investments, rental properties or trusts
      will be considered. Spousal income will also not be eligible for gross-up
      unless the spouse also is employed by the Company.


<PAGE>

                                   TAX SUMMARY

     --------------------------------------------------------------------------
     Reimbursement         Added to     Taxable         Tax Assistance (2)
                             W-2        Income
      -------------------------------------------------------------------------
     Home Sale Program        No           No                   No
     --------------------------------------------------------------------------
     MAP Home Sale Bonus      Yes         Yes                   No
     --------------------------------------------------------------------------
     Lump Sum Payment         Yes         Yes                   Yes
     --------------------------------------------------------------------------
     Lease Break Penalty      Yes         Yes                   Yes
     --------------------------------------------------------------------------
     Closing Cost on Old      Yes         Yes                   Yes
     Residence (outside
     the Home Sale
     Program)
     --------------------------------------------------------------------------
     Loss on Sale             Yes         Yes                   Yes
     --------------------------------------------------------------------------
     Household Goods      (1)   No         No                   No
     Shipment
     and 30 days of
     Storage
     --------------------------------------------------------------------------
     Storage over 30          Yes         Yes                   Yes
     Days
     --------------------------------------------------------------------------
     New Home Purchase      Yes*/No     Yes*/No               Yes*/No
     --------------------------------------------------------------------------
     Duplicate Housing        Yes         Yes                   Yes
     --------------------------------------------------------------------------
     Tax Assistance (1)       Yes         Yes                   Yes
     --------------------------------------------------------------------------

1.       Tax gross-up on gross-up payments
2.       FICA will be withheld up to the yearly base and will not be grossed-up
*        If the employee does not utilize SIRVA's `No Closing Cost Loan'
         Program *


<PAGE>

ARTICLE VI. ADMINISTRATION OF POLICY

A.    After an employee has accepted a new position/job transfer, a relocation
      authorization will be provided to SIRVA by AEP's Human Resources
      Relocation Coordinator. Assuming the house is marketable, the offer
      process will be continued. In addition, the employee will be requested to
      inform SIRVA of the original purchase price of his/her home and the
      outstanding balance of any existing mortgages on the property. If the
      employee decides to not accept the transfer, the process will stop upon
      notification to SIRVA.

B.    In the case of inter-company transfers, the Business Unit into which the
      employee is transferred will bear the cost of the relocation.

C.    All expenses pertaining to the relocation shall be approved by the Human
      Resources Department after review by SIRVA.

D.    The Human Resources Department at the new location will offer the employee
      such assistance and advice as shall be required.

E.    Any exceptions to this policy or home disposal procedures require the
      approval of the appropriate member of management. All requests for
      exceptions are to be submitted to the Human Resources Department.



<PAGE>

                                                                   ATTACHMENT I

SIRVA Relocation                                      Equity Loan Agreement
                                                        and Promissory Note


Employee Name:                      File No:

Loan Amount $                  Check Number:                Date Issued:

SIRVA Approval:

Property Address:

$                             Date:


For value received, the undersigned Makers hereby promise to pay to SIRVA
Relocation (hereinafter "SIRVA"), or its order, at its designated office, the
principal sum of _________ Dollars ($____) on or before the earliest to occur of
(a) the expiration of an offer by SIRVA to purchase the Maker's home; (b) the
closing of the sale of the Maker's home pursuant to contract of sales between
the Makers, as sellers, and a third party, as buyer, or the failure to
consummate such a sale at the scheduled place and time; (c) cancellation of the
Makers' relocation for any reason whatsoever, or (e) the effective date of
termination of the Relocation Management Agreement between SIRVA and the Makers'
employer of the Equity Loan Agreement Service contained herein, (f) SIRVA
determines that the Agreement and Promissory Note has remained outstanding for
an unreasonable period of time.

In the event that SIRVA purchases the Makers' home, the principal sum due shall
be deducted from the equity due the Makers' under the application contract, and
the deficit, if any, shall become immediately due and payable to SIRVA. In order
to secure repayment of the indebtedness, the Makers' hereby assign, transfer and
set over unto SIRVA all rights, title and interest in and to any agreement for
the sale of the Makers' home which the Makers have entered into or may in the
future enter into, and in and to all sums due or to become due thereunder or
which may be payable on account of the sale of the said Home. Any such sum
received by the Makers shall be held by them in trust as the property of SIRVA,
and shall be paid by the Makers to SIRVA on demand by SIRVA, up to the amount of
the Makers indebtedness to SIRVA under this agreement and promissory note.
Makers agree not to consummate a sale of their Home without advising SIRVA prior
thereto.

In consideration of SIRVA entering into this agreement and promissory note:

(a) The Makers represent that the loan will be used solely for the purpose of
purchasing a new principal residence in connection with a transfer to a new
principal place of employment and that neither the former for the new principal
residence is or will be located outside the United State or a United States
possession.

(b) The Makers represent that the Makers intend to sell their Home, and have
taken appropriate action, such as listing with brokers, or will do so within a
reasonable time. The Makers agree that the Makers will notify SIRVA in writing
when the Makers enter into an agreement to sell their Home, and again when title
passes.

(c) The Makers represent that the Makers have no intention of converting the
Makers' present or former principal residence to business or investment use.

(d) The Makers agree that any loss which the Makers sustain because of
nonfulfillment of any contract to sell and purchase their Home by either the
Makers, the buyer, or any other third party, is the Makers' responsibility, and
that in such event the Makers will be obligated to repay their indebtedness to
SIRVA.

 (e) The Makers agree that the obligations and benefits under this agreement and
promissory note are personal to the Makers and may not be transferred, assigned
or otherwise disposed of to any person except their employer.

(f) The Makers agree that their Home will not be made subject to any further
indebtedness by the Makers' affirmative act subsequent to signing this agreement
and promissory note without prior written approval of SIRVA.

(g) The Makers hereby represent that the Makers intent to and will itemize their
deductions on their Federal Income Tax Returns.


The undersigned Makers hereby waive presentment and notice of dishonor and agree
that the obligations and benefits under this agreement and promissory note are
personal to them and may not be transferred, assigned, or otherwise disposed of
to any person except the Maker's employer.


This instrument shall be governed by the laws of the State of Ohio.



Maker:                                                Date:

Social Security No.:

Maker:                                                Date:

Social Security No.:


<PAGE>


Newly Hired Exempt Employee                                      ATTACHMENT II
Salary Grade 26 and Above


                     RELOCATION SERVICES - EMPLOYMENT CONTRACT

THIS AGREEMENT, made and entered into this ___ day of __________ by and between
AMERICAN ELECTRIC POWER, a corporation (hereinafter called "Company") and
______________________ of _________________ hereinafter called "Employee").

                                   WITNESSETH THAT

        WHEREAS, Employee proposes to accept employment as an exempt employee of
the Company at ______________, and

        WHEREAS, Employee, in order to accept such position, must move his place
of residence to ______________________________________, or its environs, and

        WHEREAS, Company is willing to pay the moving and incidental expenses of
Employee providing Employee agrees to certain conditions,

        NOW, THEREFORE, for and in consideration of the agreements hereinafter
contained, Company and Employee do hereby agree as follows:

      1.    Company will pay the moving and incidental expenses of Employee in
            accordance with the Special Relocation Expense Policy - Newly-Hired
            Exempt Employees SG 26 & Above.

      2.    Should Employee  voluntarily  terminate his/her  employment with the
            Company  within  one  year  from  the  date of  his/her  employment,
            Employee,  upon request of the Company, agrees to reimburse Company,
            promptly upon such  termination,  for all payments made to Employee,
            or in his/her  behalf  pursuant  to the Special  Relocation  Expense
            Policy - Newly-Hired  Exempt  Employees SG 26 & Above,  EXCEPT those
            made  pursuant  to Article  III - Sections A (Lump Sum  Payment  for
            house hunting,  temporary  living and final move) and E (payment for
            movement of household goods).

IN WITNESS WHEREOF, the parties hereto have executed this agreement, the day and
year first above written.

                        AMERICAN ELECTRIC POWER

                        By                             Date
                        (Company Representative)


                                                       Date
                        (Employee)


<PAGE>
                                                                     EXHIBIT B

                   AMERICAN ELECTRIC POWER SERVICE CORPORATION

                           CHANGE IN CONTROL AGREEMENT

                         FOR THE OFFICE OF THE CHAIRMAN

      Whereas, American Electric Power Service Corporation, a New York
corporation, including any of its subsidiary companies, divisions,
organizations, or affiliated entities (collectively referred to as "AEPSC")
considers it essential to its best interests and the best interests of the
shareholders of the American Electric Power Company, Inc., a New York
corporation, (hereinafter referred to as "Corporation") to foster the continued
employment of key management personnel; and

      Whereas, the uncertainty attendant to a Change In Control of the
Corporation may result in the departure or distraction of management personnel
to the detriment of AEPSC and the shareholders of the Corporation; and

      Whereas, the Board of the Corporation has determined that steps should be
taken to reinforce and encourage the continued attention and dedication of
members of AEPSC's management to their assigned duties in the event of a Change
In Control of the Corporation.

      Now Therefore, AEPSC hereby establishes the American Electric Power
Service Corporation Change In Control Agreement (the "Agreement").


                                    ARTICLE I
                                   DEFINITIONS

      As used herein the following words and phrases shall have the following
respective meanings unless the context clearly indicates otherwise.

      (a) "Anniversary Date" means January 1 of each Calendar Year.

      (b) "Annual Compensation" means the sum of the Executive's Annual Salary
and the Executive's Target Annual Incentive.

      (c) "Annual Salary" means the Executive's regular annual base salary
immediately prior to the Executive's termination of employment, including
compensation converted to other benefits under a flexible pay arrangement
maintained by AEPSC or deferred pursuant to a written plan or agreement with
AEPSC, but excluding allowances and compensation paid or payable under any of
AEPSC's long-term or short-term incentive plans or any similar payments.

      (d) "Board" means the Board of Directors of American Electric Power
Company, Inc.

      (e) "Calendar Year" means the twelve (12) month period commencing each
January 1 and ending each December 31.

      (f) "Cause" shall mean

            (i) the willful and continued failure of the Executive to perform
            substantially the Executive's duties with AEPSC (other than any such
            failure resulting from incapacity due to physical or mental
            illness), after a written demand for substantial performance is
            delivered to the Executive by the Board or an elected officer of
            AEPSC which specifically identifies the manner in which the Board or
            the elected officer believes that the Executive has not
            substantially performed the Executive's duties, or

            (ii) the willful engaging by the Executive in illegal conduct or
            gross misconduct which is materially and demonstrably injurious to
            AEPSC or the Corporation, or a breach of the Executive's fiduciary
            duty to AEPSC or the Corporation, as determined by the Board.

      For purposes of this provision, no act or failure to act, on the part of
the Executive, shall be considered "willful" unless it is done, or omitted to be
done, by the Executive in bad faith or without reasonable belief that the
Executive's action or omission was in the best interests of AEPSC or the
Corporation. Any act, or failure to act, based upon authority given pursuant to
a resolution duly adopted by the Board or upon the advice of counsel for AEPSC
or the Corporation, shall be conclusively presumed to be done, or omitted to be
done, by the Executive in good faith and in the best interests of AEPSC or the
Corporation

      (g) "Change In Control" of the Corporation shall be deemed to have
occurred if (i) any "person" or "group" (as such terms are used in Section 13(d)
and 14(d) of the Securities Exchange Act of 1934 ("Exchange Act"), other than
AEPSC, any company owned, directly or indirectly, by the shareholders of the
Corporation in substantially the same proportions as their ownership of stock of
the Corporation or a trustee or other fiduciary holding securities under an
employee benefit plan of the Corporation, becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of more
than 25 percent of the then outstanding voting stock of the Corporation; (ii)
during any period of two consecutive years, individuals who at the beginning of
such period constitute the Board, together with any new directors (other than a
director nominated by a person (x) who has entered into an agreement with the
Corporation to effect a transaction described in this Article I (g)(i), (iii) or
(iv) hereof or (y) who publicly announces an intention to take or to consider
taking action (including, but not limited to, an actual or threatened proxy
contest) which if consummated would constitute a Change In Control) whose
election or nomination for election was approved by a vote of at least
two-thirds of the directors then still in office who were either directors at
the beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason, except for death or disability, to
constitute at least a majority of the Board; or (iii) the consummation of a
merger or consolidation of the Corporation with any other entity, other than a
merger or consolidation which would result in the voting securities of the
Corporation outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving entity) at least 50 percent of the total voting power represented
by the voting securities of the Corporation or such surviving entity outstanding
immediately after such merger or consolidation; or (iv) the shareholders of the
Corporation approve a plan of complete liquidation of the Corporation, or an
agreement for the sale or disposition by the Corporation (in one transaction or
a series of transactions) of all or substantially all of the Corporation's
assets.

      (h) "Code" means the Internal Revenue Code of 1986, as amended from time
to time.

      (i) "Commencement Date" means January 1, 2002, which shall be the
beginning date of the term of this Agreement.

      (j) "Disability" means the Executive's total and permanent disability as
defined in AEPSC's long-term disability plan covering the Executive immediately
prior to the Change In Control.

      (k) "Executive" means an employee of AEPSC who is designated by AEPSC as
an employee entitled to benefits, if any, under the terms of this Agreement.

      (l) "Good Reason" means;

            (1) an adverse change in the Executive's status, duties or
      responsibilities as an executive of AEPSC as in effect immediately prior
      to the Change In Control, provided that the Executive shall have given
      AEPSC written notice of the alleged adverse change and AEPSC shall have
      failed to cure such change within thirty (30) days after its receipt of
      such notice;

            (2) failure of AEPSC to pay or provide the Executive in a timely
      fashion the salary or benefits to which the Executive is entitled under
      any employment agreement between AEPSC and the Executive in effect on the
      date of the Change In Control, or under any benefit plans or policies in
      which the Executive was participating at the time of the Change In
      Control, provided that such failure was other than an isolated,
      insubstantial and inadvertent action not taken in bad faith and which is
      remedied by the Corporation within eight days following notice from the
      Executive;

            (3) the reduction of the Executive's salary as in effect on the date
      of the Change In Control;

            (4) the taking of any action by AEPSC (including the elimination of
      a plan without providing substitutes therefore, the reduction of the
      Executive's awards thereunder or failure to continue the Executive's
      participation therein) that would substantially diminish the aggregate
      projected value of the Executive's awards or benefits under AEPSC's
      benefit plans or policies in which the Executive was participating at the
      time of the Change In Control;

            (5) a failure by AEPSC or the Corporation to obtain from any
      successor the assent to this Agreement contemplated by Article IV hereof;
      or

            (6) the relocation, without the Executive's prior approval, of the
      office at which the Executive is to perform services on behalf of AEPSC to
      a location more than fifty (50) miles from its location immediately prior
      to the Change In Control or a change, without the Executive's prior
      approval, in the Executive's business travel obligation subsequent to the
      Change In Control that requires the Executive to travel on a regular and
      continuous basis in an amount that represents a significant increase, from
      immediately prior to the Change In Control, in the portion of the
      Executive's working time routinely devoted to business travel.

      Any circumstance described in this Article I (l) shall constitute Good
Reason even if such circumstance would not constitute a breach by AEPSC of the
terms of an employment agreement between AEPSC and the Executive in effect on
the date of the Change In Control. The Executive shall be deemed to have
terminated employment for Good Reason effective upon the effective date stated
in a written notice of such termination given by the Executive to AEPSC (which
notice shall not be given, in circumstances described in Article I (1), before
the end of the thirty (30) day period described therein, or in circumstances
described in Article I (l)(2), before the end of the eight day period described
therein), setting forth in reasonable detail the facts and circumstances claimed
to provide the basis for termination, provided that the effective date may not
precede, nor be more than sixty (60) days from, the date such notice is given.
The Executive's continued employment shall not constitute consent to, or a
waiver of rights with respect to, any circumstances constituting Good Reason
hereunder.

      (m) "Retirement" shall mean an Executive's termination of employment after
attainment of age 55 with five or more years of service with AEPSC.

      (n) "Target Annual Incentive" shall mean the award that the Executive
would have received under the Senior Officer Annual Incentive Compensation Plan
("SOIP") or the Management Incentive Compensation Plan ("MICP") for the year in
which the Executive's termination occurs, if one hundred percent (100%) of the
annual target award has been earned. Executives participating in annual
incentive compensation plans that do not have predefined target levels will be
treated as though they were participants in either the SOIP or MICP and will be
assigned the same annual target percent as their participating peers in a
comparable salary grade.

      (o) "Qualifying Termination" shall mean following a Change In Control and
during the term of this Agreement the Executive's employment is terminated for
any reason excluding (i) the Executive's death, (ii) the Executive's Disability,
(iii) the Executive's Retirement, (iv) by AEPSC for Cause or (v) by the
Executive without Good Reason. In addition, a Qualifying Termination shall be
deemed to have occurred if, prior to a Change In Control, the Executive's
employment was terminated during the term of this Agreement by AEPSC without
Cause, or by the Executive for Good Reason based on events or circumstances that
occurred, (i) at the request of a person who has entered into an agreement with
AEPSC or the Corporation, the consummation of which would constitute a Change In
Control or (ii) otherwise in connection with, as a result of or in anticipation
of a Change In Control. The mere act of approving a Change In Control agreement
shall not in and of itself be deemed to constitute an event or circumstance in
anticipation of a Change In Control for purposes of this Article I (o).

                                   ARTICLE II
                                TERM OF AGREEMENT

      2.1 The initial term of this Agreement shall be for the period beginning
on the Commencement Date and ending on the December 31 immediately following the
Commencement Date. The term of this Agreement shall automatically be extended
for an additional Calendar Year on the first Anniversary Date immediately
following the initial term of this Agreement without further action by AEPSC,
and shall be automatically extended for an additional Calendar Year on each
succeeding Anniversary Date, unless AEPSC shall have served notice upon the
Executive at least sixty (60) days prior to such Anniversary Date of AEPSC's
intention that this Agreement shall not be extended, provided, however, that if
a Change In Control of the Corporation shall occur during the term of this
Agreement, this Agreement shall terminate two years after the date the Change In
Control is completed.

      2.2 If an employee is designated as an Executive after the Commencement
Date or after an Anniversary Date, the initial term of this Agreement shall be
for the period beginning on the date the employee is designated as an Executive
and ending on the December 31 immediately following.

      2.3 Notwithstanding Section 2.1, the term of this Agreement shall end upon
any termination of the Executive's employment prior to a Change In Control of
the Corporation. This Agreement shall also terminate if the Executive's position
is eliminated due to a downsizing, consolidation or restructuring of AEPSC other
than by reason of a Change In Control.


                                   ARTICLE III
         COMPENSATION UPON A CHANGE IN CONTROL FOLLOWED BY A TERMINATION

      3.1 Upon a Qualifying Termination, the Executive shall be under no further
obligation to perform services for AEPSC and shall be entitled to receive the
following payments and benefits:

     (a)  As soon as practicable  following the Executive's date of termination,
          AEPSC shall make a lump sum cash payment to the Executive in an amount
          equal to the sum of (1) the Executive's Annual Salary through the date
          of termination to the extent not theretofore  paid, (2) the product of
          (x)  the  current  plan  year's  Target  Annual  Incentive  and  (y) a
          fraction,  the  numerator  of  which  is the  number  of  days in such
          calendar year through the date of termination,  and the denominator of
          which is 365,  except  that annual  incentive  plans which do not have
          predetermined  annual target awards for participants  shall have their
          pro-rated incentive  compensation award for the current plan year paid
          as soon as practicable, and (3) any accrued vacation pay, in each case
          the extent not theretofore paid and in full satisfaction of the rights
          of the Executive thereto;

     (b)  Within sixty (60) days of the Executive's return of the signed release
          form,  AEPSC shall make a lump sum cash payment to the Executive in an
          amount equal to three times the Executive's Annual Compensation; and

     (c)  For purposes of the American  Electric  Power  System  Excess  Benefit
          Plan,  or any  successor  thereto,  provided  that the  Executive is a
          participant thereunder, the Executive shall be credited with three (3)
          additional  years of service;  provided that if the Executive is older
          than age 62 as of the  Executive's  date of termination the additional
          years of  service  shall be  limited  to the  difference  between  the
          Executive's  age as of the  date  of  termination  and  the  date  the
          Executive  would  attain age 65,  and  assuming  that the  Executive's
          compensation  for the  additional  period of  service  would have been
          equal to the Executive's  compensation in effect as of the Executive's
          date of termination.

      3.2 The Executive shall be entitled to the continuing benefits as follows:

     (a)  For the  three  (3) year  period  following  the  Executive's  date of
          termination,  the  Executive  and  the  Executive's  family  shall  be
          provided  with  medical  and  dental  insurance  benefits  as  if  the
          Executive's  employment had not been  terminated;  provided,  however,
          that if the Executive becomes  reemployed with another employer and is
          eligible to receive  medical or other welfare  benefits  under another
          employer-provided   plan,  the  medical  and  other  welfare  benefits
          described herein shall be secondary to those provided under such other
          plan during such  applicable  period of  eligibility.  For purposes of
          determining eligibility (but not the time of commencement of benefits)
          of the Executive  for retiree  medical and dental  insurance  benefits
          under AEPSC's plans,  practices,  programs and policies, the Executive
          shall be  considered to have  remained  employed  during the three (3)
          year period and to have  retired on the last day of the three (3) year
          period;

     (b)  AEPSC shall,  at its sole expense as incurred,  provide the  Executive
          with  outplacement  services  the scope and provider of which shall be
          selected by the Executive at the Executive's sole discretion (but at a
          cost to AEPSC of not more than $30,000) or, at the Executive's option,
          the use of comparable and accessible office space, office supplies and
          equipment  and  secretarial  services  for a period  not to exceed one
          year, which in the aggregate are of comparable cost to the Corporation
          or AEPSC as the outplacement services;

     (c)  To the extent any benefits  described in this Article III, Section 3.2
          cannot  be  provided  pursuant  to the  appropriate  plan  or  program
          maintained by AEPSC,  AEPSC shall  provide such benefits  outside such
          plan or program at no additional  cost (including  without  limitation
          tax cost) to the Executive.

      3.3   Notwithstanding the foregoing;

     (a)  The severance  payments and benefits  provided under Sections  3.1(b),
          3.1(c)  and  3.2  hereof  shall  be  conditioned  upon  the  Executive
          executing  a  release  at  the  time  the  Executive's  employment  is
          terminated,  in the form  established by the  Corporation or by AEPSC,
          releasing the  Corporation,  AEPSC and their  shareholders,  partners,
          officers, directors,  employees and agents from any and all claims and
          from any and all causes of action of kind or character,  including but
          not  limited  to  all  claims  or  causes  of  action  arising  out of
          Executive's   employment   with  the   Corporation  or  AEPSC  or  the
          termination of such employment.

     (b)  The severance  payments and benefits  provided  under Sections 3.1 and
          3.2 hereof shall be subject to, and  conditioned  upon,  the waiver of
          any other cash severance  payment or other benefits  provided by AEPSC
          pursuant  to any  other  severance  agreement  between  AEPSC  and the
          Executive.  No amount shall be payable under this  Agreement to, or on
          behalf of the Executive,  if the Executive  elects  benefits under any
          other  cash  severance  plan or  program,  or any  other  special  pay
          arrangement  with  respect  to  the  termination  of  the  Executive's
          employment.

     (c)  The  Executive  agrees that at all times  following  termination,  the
          Executive will not,  without the prior written consent of AEPSC or the
          Corporation,   disclose  to  any  person,   firm  or  corporation  any
          "confidential  information," of AEPSC or the Corporation  which is now
          known to the  Executive  or which  hereafter  may become  known to the
          Executive as a result of the  Executive's  employment  or  association
          with AEPSC or the  Corporation,  unless  such  disclosure  is required
          under the terms of a valid and effective subpoena or order issued by a
          court or  governmental  body;  provided,  however,  that the foregoing
          shall not apply to  confidential  information  which becomes  publicly
          disseminated  by means  other than a breach of this  provision.  It is
          recognized  that damages in the event of breach of this Section 3.3(c)
          by the Executive would be difficult, if not impossible,  to ascertain,
          and it is therefore agreed that AEPSC and the Corporation, in addition
          to and without  limiting  any other  remedy or right that AEPSC or the
          Corporation  may have,  shall have the right to an injunction or other
          equitable relief in any court of competent jurisdiction, enjoining any
          such breach,  and the Executive hereby waives any and all defenses the
          Executive may have on the ground of lack of jurisdiction or competence
          of the court to grant such an  injunction or other  equitable  relief.
          The  existence  of  this  right  shall  not  preclude   AEPSC  or  the
          Corporation  from  pursuing  any other rights or remedies at law or in
          equity which AEPSC or the Corporation may have.

          "Confidential information" shall mean any confidential,  propriety and
          or trade secret information,  including, but not limited to, concepts,
          ideas, information and materials relating to AEPSC or the Corporation,
          client  records,   client  lists,  economic  and  financial  analysis,
          financial data, customer contracts, marketing plans, notes, memoranda,
          lists, books,  correspondence,  manuals, reports or research,  whether
          developed by AEPSC or the  Corporation  or developed by the  Executive
          acting  alone or  jointly  with  AEPSC or the  Corporation  while  the
          Executive was employed by AEPSC.

      3.4 Notwithstanding anything to the contrary in this Agreement, in the
event that any payment or distribution by AEPSC to or for the benefit of the
Executive, whether paid or payable or distributed or distributable pursuant to
the terms of this Agreement or otherwise (a "Payment"), would be subject to the
excise tax imposed by Section 4999 of the Code or any interest or penalties with
respect to such excise tax (such excise tax, together with any such interest or
penalties, are hereinafter collectively referred to as the "Excise Tax"), AEPSC
shall pay to the Executive an additional payment (a "Gross-up Payment") in an
amount such that after payment by the Executive of all taxes (including any
interest or penalties imposed with respect to such taxes), including any Excise
Tax imposed on any Gross-up Payment, the Executive retains an amount of the
Gross-up Payment equal to the Excise Tax imposed upon the Payments. AEPSC and
the Executive shall make an initial determination as to whether a Gross-up
Payment is required and the amount of any such Gross-up Payment. Executive shall
notify AEPSC immediately in writing of any claim by the Internal Revenue Service
which, if successful, would require AEPSC to make a Gross-up Payment (or a
Gross-up Payment in excess of that, if any, initially determined by AEPSC and
the Executive) within five days of the receipt of such claim. AEPSC shall notify
the Executive in writing at least five days prior to the due date of any
response required with respect to such claim, or such shorter time period
following AEPSC's receipt of the notice, if it plans to contest the claim. If
AEPSC decides to contest such claim, the Executive shall cooperate fully with
AEPSC in such action; provided, however, AEPSC shall bear and pay directly or
indirectly all costs and expenses (including additional interest and penalties)
incurred in connection with such action and shall indemnify and hold the
Executive harmless, on an after-tax basis, for any Excise Tax or income tax,
including interest and penalties with respect thereto, imposed as a result of
AEPSC's action. If, as a result of AEPSC's action with respect to a claim, the
Executive receives a refund of any amount paid by AEPSC with respect to such
claim, the Executive shall promptly pay such refund to AEPSC. If AEPSC fails to
timely notify the Executive whether it will contest such claim or AEPSC
determines not to contest such claim, then AEPSC shall immediately pay to the
Executive the portion of such claim, if any, which it has not previously paid to
the Executive.

      3.5 The obligations of AEPSC to pay the benefits described in Sections 3.1
and 3.2 shall be absolute and unconditional and shall not be affected by any
circumstances, including, without limitation, any set-off, counterclaim,
recoupment, defense or other right which AEPSC may have against the Executive.
In no event shall the Executive be obligated to seek other employment or take
any other action by way of mitigation of the amounts payable to the Executive
under any of the provisions of this Agreement, nor shall the amount of any
payment hereunder be reduced by any compensation earned by the Executive as a
result of employment by another employer, except as specifically provided in
Section 3.2.


                                   ARTICLE IV
                            SUCCESSOR TO CORPORATION

      4.1 This Agreement shall bind any successor of AEPSC or the Corporation,
its assets or its businesses (whether direct or indirect, by purchase, merger,
consolidation or otherwise) in the same manner and to the same extent that AEPSC
or the Corporation would be obligated under this Agreement if no succession had
taken place.

      4.2 In the case of any transaction in which a successor would not by the
foregoing provision or by operation of law be bound by this Agreement, AEPSC and
the Corporation shall require such successor expressly and unconditionally to
assume and agree to perform AEPSC's and the Corporation's obligations under this
Agreement, in the same manner and to the same extent that AEPSC and the
Corporation would be required to perform if no such succession had taken place.
The term "Corporation," as used in this Agreement, shall mean the Corporation as
hereinbefore defined and any successor or assignee to the business assets which
by reason hereof becomes bound by this Agreement.


                                    ARTICLE V
                                  MISCELLANEOUS

      5.1 Any notices and all other communications provided for herein shall be
in writing and shall be deemed to have been duly given when delivered or mailed,
by certified or registered mail, return receipt requested, postage prepaid
addressed to AEPSC at its principal office and to the Executive at the
Executive's residence or at such other addresses as AEPSC or the Executive shall
designate in writing.

      Section 5.2 No provision of this Agreement may be modified, waived or
discharged except in a writing specifically referring to such provision and
signed by either AEPSC or the Executive against whom enforcement of such
modification, waiver or discharge is sought. No waiver by either AEPSC or the
Executive of the breach of any condition or provision of this Agreement shall be
deemed a waiver of any other condition or provision at the same or any other
time.

      5.3 The validity, interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of Ohio.

      5.4 The invalidity or unenforceability of any provision of this Agreement
shall not affect the validity or enforceability of any other provision of this
Agreement, which shall remain in full force and effect.

      5.5 This Agreement does not constitute a contract of employment or impose
on the Executive, AEPSC or the Corporation any obligation to retain the
Executive as an employee, to change the status of the Executive's employment, or
to change AEPSC's policies regarding the termination of employment.

      5.6 If the Executive institutes any legal action in seeking to obtain or
enforce or is required to defend in any legal action the validity or
enforceability of, any right or benefit provided by this Agreement, AEPSC will
pay for all actual and reasonable legal fees and expenses incurred (as incurred)
by the Executive, regardless of the outcome of such action; provided, however,
that if such action instituted by the Executive is found by a court of competent
jurisdiction to be frivolous, the Executive shall not be entitled to legal fees
and expenses and shall be liable to AEPSC for amounts already paid for this
purpose.

      5.7 If the Executive makes a written request alleging a right to receive
benefits under this Agreement or alleging a right to receive an adjustment in
benefits being paid under the Agreement, AEPSC shall treat it as a claim for
benefit. All claims for benefit under the Agreement shall be sent to the Human
Resources Department of AEPSC and must be received within 30 days after the
Executive's termination of employment. If AEPSC determines that the Executive
who has claimed a right to receive benefits, or different benefits, under the
Agreement is not entitled to receive all or any part of the benefits claimed, it
will inform the Executive in writing of its determination and the reasons
therefore in terms calculated to be understood by the Executive. The notice will
be sent within 90 days of the claim unless AEPSC determines additional time, not
exceeding 90 days, is needed. The notice shall make specific reference to the
pertinent Agreement provisions on which the denial is based, and describe any
additional material or information, if any, necessary for the Executive to
perfect the claim and the reason any such addition material or information is
necessary. Such notice shall, in addition, inform the Executive what procedure
the Executive should follow to take advantage of the review procedures set forth
below in the event the Executive desires to contest the denial of the claim. The
Executive may within 90 days thereafter submit in writing to AEPSC a notice that
the Executive contests the denial of the claim by AEPSC and desires a further
review. AEPSC shall within 60 days thereafter review the claim and authorize the
Executive to appear personally and review pertinent documents and submit issues
and comments relating to the claim to the persons responsible for making the
determination on behalf of AEPSC. AEPSC will render its final decision with
specific reasons therefore in writing and will transmit it to the Executive
within 60 days of the written request for review, unless AEPSC determines
additional time, not exceeding 60 days, is needed, and so notifies the
Executive. If AEPSC fails to respond to a claim filed in accordance with the
foregoing within 60 days or any such extended period, AEPSC shall be deemed to
have denied the claim.



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