<PAGE> 1
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13E-4
ISSUER TENDER OFFER STATEMENT
(PURSUANT TO SECTION 13(e)(1) OF THE SECURITIES
EXCHANGE ACT OF 1934)
------------------------
OHIO POWER COMPANY
(NAME OF ISSUER)
AMERICAN ELECTRIC POWER COMPANY, INC.
(NAME OF PERSON FILING STATEMENT)
<TABLE>
<CAPTION>
TITLE CUSIP
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<S> <C>
Ohio Power Company, Cumulative Preferred Stock
-- 4 1/2% Series 677415 40 8
-- 4.08% Series 677415 10 1
-- 4.20% Series 677415 20 0
-- 4.40% Series 677415 30 9
-- 5.90% Series 677415 79 6
-- 6.02% Series 677415 81 2
-- 6.35% Series 677415 82 0
</TABLE>
(TITLE OF CLASS OF SECURITIES)
(CUSIP NUMBER OF CLASS OF SECURITIES)
ARMANDO A. PENA
TREASURER
AMERICAN ELECTRIC POWER COMPANY, INC.
1 RIVERSIDE PLAZA
COLUMBUS, OHIO 43215
(614) 223-1000
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED
TO RECEIVE NOTICES AND COMMUNICATIONS ON BEHALF OF
THE PERSON FILING STATEMENT)
JANUARY 30, 1997
(DATE TENDER OFFER FIRST PUBLISHED, SENT
OR GIVEN TO SECURITY HOLDERS)
CALCULATION OF FILING FEE
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TRANSACTION VALUATION* AMOUNT OF FILING FEE
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<S> <C>
$148,431,600 $29,687
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</TABLE>
* Solely for purposes of calculating the filing fee and computed pursuant to
Section 13(e)(3) of the Securities Exchange Act of 1934, as amended, and Rule
0-11(b)(1) thereunder, the transaction value equals the total amount of funds,
excluding fees and other expenses, required to purchase all outstanding shares
of each class of securities listed above pursuant to the Offer described in
the Offer to Purchase and Proxy Statement filed as an Exhibit hereto.
[ ] Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the form
or schedule and the date of its filing.
Amount Previously Paid:
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Form or Registration No.:
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Filing Party:
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Date Filed:
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<PAGE> 2
ITEM 1. SECURITY AND ISSUER.
(a) The name of the issuer is Ohio Power Company ("OPCo"), 301 Cleveland
Avenue, S.W., Canton, Ohio 44702.
(b) Incorporated herein by reference to the information appearing on the
front cover of the Offer to Purchase and Proxy Statement, and to the information
appearing under the captions "Terms of the Offer -- Number of Shares; Purchase
Prices; Expiration Date; Dividends" and "Transactions and Agreements Concerning
the Shares" in the Offer to Purchase and Proxy Statement.
(c) Incorporated herein by reference to the information appearing under the
caption "Price Range of Shares; Dividends" in the Offer to Purchase and Proxy
Statement.
(d) American Electric Power Company, Inc., a New York corporation
("American"), is the person filing this Statement and is the parent holding
company of OPCo. American's principal office is at 1 Riverside Plaza, Columbus,
Ohio 43215.
ITEM 2. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) Incorporated herein by reference to the information appearing under the
caption "Source and Amount of Funds" in the Offer to Purchase and Proxy
Statement.
(b) Incorporated herein by reference to the information appearing under the
caption "Source and Amount of Funds" in the Offer to Purchase and Proxy
Statement.
ITEM 3. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE ISSUER OR
AFFILIATE.
Incorporated herein by reference to the information appearing under the
caption "Purpose of the Offer; Certain Effects of the Offer" in the Offer to
Purchase and Proxy Statement.
ITEM 4. INTEREST IN SECURITIES OF THE ISSUER.
Incorporated herein by reference to the information appearing under the
caption "Transactions and Agreements Concerning the Shares" in the Offer to
Purchase and Proxy Statement.
ITEM 5. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
THE ISSUER'S SECURITIES.
Incorporated herein by reference to the information appearing under the
caption "Transactions and Agreements Concerning the Shares" in the Offer to
Purchase and Proxy Statement.
ITEM 6. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
Incorporated herein by reference to the information appearing under the
caption "Fees and Expenses Paid to Dealers" in the Offer to Purchase and Proxy
Statement.
ITEM 7. FINANCIAL INFORMATION.
(a) Incorporated herein by reference to the financial statements included
in the Annual Report on Form 10-K for the year ended December 31, 1995 of OPCo
and the Quarterly Reports on Form 10-Q for the quarterly periods ended September
30, 1996 and September 30, 1995 of OPCo, and to the information appearing under
the caption "Summary of Consolidated Financial Information" in the Offer to
Purchase and Proxy Statement.
(b) Not applicable.
ITEM 8. ADDITIONAL INFORMATION.
(a) Not applicable.
<PAGE> 3
(b) Incorporated herein by reference to the information appearing under the
caption "Terms of the Offer -- Certain Conditions of the Offer" in the Offer to
Purchase and Proxy Statement.
(c) Not applicable.
(d) Not applicable.
(e) See Exhibits 99.(a)(1) and 99.(a)(2).
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
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<S> <C>
99.(a)(1) Offer to Purchase and Proxy Statement, dated January 30, 1997.
99.(a)(2) Letter of Transmittal for each series of securities.
99.(a)(3) Notice of Guaranteed Delivery.
99.(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and other
Nominees.
99.(a)(5) Form of Letter to Clients of Brokers, Dealers, Commercial Banks, Trust Companies
and other Nominees.
99.(a)(6) Summary Simplified Instructions.
99.(a)(7) Summary Advertisement, dated January 30, 1997.
99.(a)(8) Letter to Shareholders, dated January 30, 1997.
99.(a)(9) Press Release, dated January 29, 1997.
99.(b) Not applicable.
99.(c) Not applicable.
99.(d) Tax Opinion of Simpson Thacher & Bartlett.
99.(e) Not applicable.
99.(f) Not applicable.
</TABLE>
<PAGE> 4
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: January 29, 1997
American Electric Power Company, Inc.
By: /s/ ARMANDO A. PENA
------------------------------------
Armando A. Pena
Treasurer
<PAGE> 5
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIALLY
NUMBERED
EXHIBIT NO. DESCRIPTION PAGE
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<C> <S> <C>
99. (a) (1) Offer to Purchase and Proxy Statement, dated January 30, 1997.
99. (a) (2) Letter of Transmittal for each series of securities.
99. (a) (3) Notice of Guaranteed Delivery.
99. (a) (4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and other Nominees.
99. (a) (5) Form of Letter to Clients of Brokers, Dealers, Commercial Banks, Trust Companies
and other Nominees.
99. (a) (6) Summary Simplified Instructions.
99. (a) (7) Summary Advertisement, dated January 30, 1997.
99. (a) (8) Letter to Shareholders, dated January 30, 1997.
99. (a) (9) Press Release, dated January 29, 1997.
99. (b) Not applicable.
99. (c) Not applicable.
99. (d) Tax Opinion of Simpson Thacher & Bartlett
99. (e) Not applicable.
99. (f) Not applicable.
</TABLE>
<PAGE> 1
OFFER TO PURCHASE AND PROXY STATEMENT
AMERICAN ELECTRIC POWER COMPANY, INC.
OFFER TO PURCHASE FOR CASH
ANY AND ALL OUTSTANDING SHARES OF THE FOLLOWING SERIES OF
CUMULATIVE PREFERRED STOCK OF
OHIO POWER COMPANY
202,403 SHARES, CUMULATIVE PREFERRED STOCK, 4- 1/2% SERIES AT A PURCHASE PRICE
OF $ 69.02 PER SHARE, CUSIP NUMBER 677415 40 8
42,575 SHARES, CUMULATIVE PREFERRED STOCK, 4.08% SERIES AT A PURCHASE PRICE OF
$ 64.56 PER SHARE, CUSIP NUMBER 677415 10 1
51,975 SHARES, CUMULATIVE PREFERRED STOCK, 4.20% SERIES AT A PURCHASE PRICE OF
$ 66.46 PER SHARE, CUSIP NUMBER 677415 20 0
88,363 SHARES, CUMULATIVE PREFERRED STOCK, 4.40% SERIES AT A PURCHASE PRICE OF
$ 69.62 PER SHARE, CUSIP NUMBER 677415 30 9
404,000 SHARES, CUMULATIVE PREFERRED STOCK, 5.90% SERIES AT A PURCHASE PRICE OF
$103.09 PER SHARE, CUSIP NUMBER 677415 79 6
395,000 SHARES, CUMULATIVE PREFERRED STOCK, 6.02% SERIES AT A PURCHASE PRICE OF
$103.71 PER SHARE, CUSIP NUMBER 677415 81 2
300,000 SHARES, CUMULATIVE PREFERRED STOCK, 6.35% SERIES AT A PURCHASE PRICE OF
$105.14 PER SHARE, CUSIP NUMBER 677415 82 0
------------------------
OHIO POWER COMPANY
PROXY STATEMENT
WITH RESPECT TO ITS COMMON STOCK AND CUMULATIVE PREFERRED STOCK
------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON FRIDAY, FEBRUARY 28, 1997, UNLESS THE OFFER IS EXTENDED.
------------------------
American Electric Power Company, Inc., a New York corporation ("AEP"),
invites the holders of each series of cumulative preferred stock listed above
(each a "Series of Preferred," and the holder thereof a "Preferred Shareholder")
of Ohio Power Company, an Ohio corporation and direct utility subsidiary of AEP
("OPCo"), to tender any and all of their shares of a Series of Preferred
("Shares") for purchase at the purchase price per Share listed above plus
accrued and unpaid dividends for the Shares tendered, net to the seller in cash,
upon the terms and subject to the conditions set forth in this Offer to Purchase
and Proxy Statement and in the accompanying Letter of Transmittal (which
together constitutes the "Offer"). AEP will purchase any and all Shares validly
tendered and not withdrawn, upon the terms and subject to the conditions of the
Offer. See "Terms of the Offer -- Certain Conditions of the Offer" and "Terms of
the Offer -- Extension of Tender Period; Termination; Amendments."
THE OFFER FOR A SERIES OF PREFERRED IS NOT CONDITIONED UPON ANY MINIMUM
NUMBER OF SHARES OF SUCH SERIES OF PREFERRED BEING TENDERED AND IS INDEPENDENT
OF THE OFFER FOR ANY OTHER SERIES OF PREFERRED. THE OFFER, HOWEVER, IS
CONDITIONED UPON, AMONG OTHER THINGS, THE PROPOSED AMENDMENT, AS DESCRIBED
BELOW, BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED BELOW). SEE
"TERMS OF THE OFFER -- CERTAIN CONDITIONS OF THE OFFER."
Concurrently with the Offer, the Board of Directors of OPCo is soliciting
proxies for use at the Special Meeting of Shareholders of OPCo to be held at
AEP's principal office, 1 Riverside Plaza, Columbus, Ohio 43215, on February 28,
1997 at 4:30 p.m., New York City time, or any adjournment or postponement of
such meeting (the "Special Meeting"). The Special Meeting is being held (i) to
consider an amendment (the "Proposed Amendment") to OPCo's Amended Articles of
Incorporation (the "Articles") which would remove a provision of the Articles
that limits OPCo's ability to issue unsecured debt and (ii) to consider an
amendment (the "Second Proposed Amendment") to the Articles which would clarify
the authority of the Board of Directors to purchase or otherwise acquire Shares.
WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT TO THE
OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT, THE OFFER IS CONDITIONED
UPON THE PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING.
IN ADDITION, PREFERRED SHAREHOLDERS OF RECORD HAVE THE RIGHT TO VOTE FOR OR
AGAINST THE PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES.
IF THE PROPOSED AMENDMENT IS APPROVED AND ADOPTED BY OPCO'S SHAREHOLDERS, OPCO
WILL MAKE A SPECIAL CASH PAYMENT IN THE AMOUNT OF $1.00 PER SHARE TO EACH
PREFERRED SHAREHOLDER WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED
THAT SUCH SHARES HAVE NOT BEEN TENDERED PURSUANT TO THE OFFER. THOSE PREFERRED
SHAREHOLDERS WHO VALIDLY TENDER THEIR SHARES WILL BE ENTITLED ONLY TO THE
PURCHASE PRICE PER SHARE LISTED ABOVE. THE SECOND PROPOSED AMENDMENT IS
INDEPENDENT OF THE OFFER AND THE PROPOSED AMENDMENT, AND NEITHER THE OFFER NOR
THE PROPOSED AMENDMENT IS IN ANY WAY CONDITIONED UPON THE SECOND PROPOSED
AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING.
------------------------
The Company will pay to a Soliciting Dealer (as defined herein) a
solicitation fee for Shares tendered, accepted for payment and paid for pursuant
to the Offer, subject to certain conditions. See "Fees and Expenses Paid to
Dealers."
------------------------
THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION (THE "SEC") NOR HAS THE SEC PASSED UPON THE FAIRNESS OR
MERITS OF THIS TRANSACTION NOR UPON THE ACCURACY OR ADEQUACY OF THE INFORMATION
CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
------------------------
NEITHER AEP, OPCO, THEIR RESPECTIVE BOARDS OF DIRECTORS, NOR ANY OF THEIR
RESPECTIVE OFFICERS MAKES ANY RECOMMENDATION TO ANY PREFERRED SHAREHOLDER AS TO
WHETHER TO TENDER ANY OR ALL SHARES. EACH PREFERRED SHAREHOLDER MUST MAKE HIS OR
HER OWN DECISION AS TO WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO
TENDER.
OPCO'S BOARD OF DIRECTORS RECOMMENDS VOTING FOR THE PROPOSED AMENDMENT.
------------------------
This Offer to Purchase and Proxy Statement is first being mailed on or about
January 30, 1997 to Preferred Shareholders of record on January 27, 1997.
------------------------
Each Series of Preferred is traded in the over-the-counter market (the
"OTC") and is not listed on any national securities exchange. On January 28,
1997, the last reported sale prices as reported by the National Quotation
Bureau, Inc. were $56.30 for the 4.08% Series of Preferred (on January 14,
1997); $57.00 for the 4.20% Series of Preferred (on January 9, 1996); and $60.70
for the 4.40% Series of Preferred (on January 14, 1997). There were no sales
prices available for the 4- 1/2% Series, the 5.90% Series, the 6.02% Series or
the 6.35% Series. Preferred Shareholders are urged to obtain a current market
quotation, if available, for the Shares.
------------------------
The Dealer Managers for the Offer are:
MERRILL LYNCH & CO. SALOMON BROTHERS INC
The date of this Offer to Purchase and Proxy Statement is January 30, 1997.
<PAGE> 2
NO PERSON HAS BEEN AUTHORIZED TO MAKE ANY RECOMMENDATION ON BEHALF OF AEP
OR OPCO AS TO WHETHER PREFERRED SHAREHOLDERS SHOULD TENDER OR REFRAIN FROM
TENDERING SHARES OF ANY SERIES OF PREFERRED PURSUANT TO THE OFFER. NO PERSON HAS
BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS IN
CONNECTION WITH THE OFFER OTHER THAN THOSE CONTAINED HEREIN OR IN THE RELATED
LETTER OF TRANSMITTAL. IF GIVEN OR MADE, SUCH RECOMMENDATION AND SUCH
INFORMATION AND REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY AEP OR OPCO.
IMPORTANT
Any Preferred Shareholder desiring to accept the Offer and tender all or
any portion of his or her Shares should either (i) request his or her broker,
dealer, commercial bank, trust company or nominee to effect the transaction for
him or her, or (ii) complete and sign the Letter of Transmittal in accordance
with the instructions in such Letter of Transmittal, mail or deliver the same
and any other required documents to First Chicago Trust Company of New York (the
"Depositary"), and deliver the certificates for such Shares to the Depositary,
along with the Letter of Transmittal, or tender such Shares pursuant to the
procedure for book-entry transfer set forth below under "Terms of the Offer --
Procedure for Tendering Shares," on or prior to the Expiration Date (as defined
below). A Preferred Shareholder whose Shares are registered in the name of a
broker, dealer, commercial bank, trust company or nominee must contact such
broker, dealer, commercial bank, trust company or nominee if he or she desires
to tender such Shares. Any Preferred Shareholder who desires to tender Shares
and whose certificates for such Shares are not immediately available, or who
cannot comply in a timely manner with the procedure for book-entry transfer,
should tender such Shares by following the procedures for guaranteed delivery
set forth below under "Terms of the Offer -- Procedure for Tendering Shares."
EACH SERIES OF PREFERRED HAS ITS OWN LETTER OF TRANSMITTAL, AND ONLY THE
APPLICABLE LETTER OF TRANSMITTAL FOR SUCH SERIES OF PREFERRED OR A NOTICE OF
GUARANTEED DELIVERY MAY BE USED TO TENDER SHARES OF SUCH SERIES OF PREFERRED.
------------------------
Questions or requests for assistance may be directed to Morrow & Co., Inc.
("Morrow" or the "Information Agent") or to Merrill Lynch & Co. ("Merrill
Lynch") and Salomon Brothers Inc ("Salomon Brothers") (Merrill Lynch and Salomon
Brothers collectively the "Dealer Managers") at their respective telephone
numbers and addresses set forth on the back cover of this Offer to Purchase and
Proxy Statement. Requests for additional copies of this Offer to Purchase and
Proxy Statement, the Letter of Transmittal or other tender offer or proxy
materials may be directed to the Information Agent, and such copies will be
furnished promptly at the companies' expense. Preferred Shareholders may also
contact their local broker, dealer, commercial bank or trust company for
assistance concerning the Offer.
2
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
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PAGE
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<S> <C>
SUMMARY............................................................................... 4
TERMS OF THE OFFER.................................................................... 7
Number of Shares; Purchase Prices; Expiration Date; Dividends....................... 7
Procedure for Tendering Shares...................................................... 8
Withdrawal Rights................................................................... 10
Acceptance of Shares for Payment and Payment of Purchase Price and Dividends........ 10
Certain Conditions of the Offer..................................................... 11
Extension of Tender Period; Termination; Amendments................................. 12
PROPOSED AMENDMENTS AND PROXY SOLICITATION............................................ 13
Introduction........................................................................ 13
Voting Securities, Rights and Procedures............................................ 14
Proxies............................................................................. 14
Special Cash Payments............................................................... 15
Security Ownership of Certain Beneficial Owners and Management...................... 15
Business to Come Before the Special Meeting......................................... 16
Explanation of the Proposed Amendment............................................... 17
Reasons for the Proposed Amendment.................................................. 18
Explanation of the Second Proposed Amendment........................................ 19
Reasons for Second Proposed Amendment............................................... 20
Relationship with Independent Public Accountants.................................... 20
PRICE RANGE OF SHARES; DIVIDENDS...................................................... 20
PURPOSE OF THE OFFER; CERTAIN EFFECTS OF THE OFFER.................................... 22
CERTAIN FEDERAL INCOME TAX CONSEQUENCES............................................... 24
SOURCE AND AMOUNT OF FUNDS............................................................ 26
TRANSACTIONS AND AGREEMENTS CONCERNING THE SHARES..................................... 26
FEES AND EXPENSES PAID TO DEALERS..................................................... 26
CERTAIN INFORMATION REGARDING AEP AND OPCO............................................ 28
SUMMARY OF CONSOLIDATED FINANCIAL INFORMATION......................................... 28
MISCELLANEOUS......................................................................... 30
</TABLE>
3
<PAGE> 4
SUMMARY
The following summary is provided solely for the convenience of the
Preferred Shareholders. This summary is not intended to be complete and is
qualified in its entirety by reference to the full text and more specific
details contained in this Offer to Purchase and Proxy Statement and the Letter
of Transmittal and any amendments hereto or thereto. Preferred Shareholders are
urged to read this Offer to Purchase and Proxy Statement and the Letter of
Transmittal in their entirety. Each of the capitalized terms used in this
summary and not defined herein has the meaning set forth elsewhere in this Offer
to Purchase and Proxy Statement.
The Companies.............. AEP, 1 Riverside Plaza, Columbus, Ohio 43215, is a
registered holding company under the Public Utility
Holding Company Act of 1935, as amended (the
"Holding Company Act"), which owns, directly or
indirectly, all of the outstanding common stock of
its electric utility subsidiaries, including OPCo.
The service area of AEP's electric utility
subsidiaries covers portions of Indiana, Kentucky,
Michigan, Ohio, Tennessee, Virginia and West
Virginia. OPCo, 301 Cleveland Avenue, S.W., Canton,
Ohio 44702, is a utility primarily engaged in the
generation, purchase, transmission and distribution
of electric power to approximately 668,000
customers in Ohio, and in supplying electric power
at wholesale to other electric utility companies
and municipalities.
The Shares................. 4-1/2% Cumulative Preferred Stock (par value $100
per share)
4.08% Cumulative Preferred Stock (par value $100
per share)
4.20% Cumulative Preferred Stock (par value $100
per share)
4.40% Cumulative Preferred Stock (par value $100
per share)
5.90% Cumulative Preferred Stock (par value $100
per share)
6.02% Cumulative Preferred Stock (par value $100
per share)
6.35% Cumulative Preferred Stock (par value $100
per share)
The Offer and Purchase
Price...................... Offer to purchase any or all shares of each Series
of Preferred at the price set forth below.
$ 69.02 per 4-1/2% Share
$ 64.56 per 4.08% Share
$ 66.46 per 4.20% Share
$ 69.62 per 4.40% Share
$103.09 per 5.90% Share
$103.71 per 6.02% Share
$105.14 per 6.35% Share
Independent Offer.......... The Offer for one Series of Preferred is
independent of the Offer for any other Series of
Preferred. The Offer is not conditioned upon any
minimum number of Shares of the applicable Series
of Preferred being tendered. Preferred Shareholders
who wish to tender their Shares are not required to
vote in favor of the Proposed Amendment. The Offer
is subject, however, to shareholder approval of the
Proposed Amendment and certain other conditions.
Expiration Date of the
Offer...................... The Offer expires at 5:00 p.m., New York City time
February 28, 1997, unless extended (the "Expiration
Date").
How to Tender Shares....... See "Terms of the Offer -- Procedure for Tendering
Shares". For further information, call the
Information Agent or the Dealer Managers or consult
your broker for assistance.
4
<PAGE> 5
Withdrawal Rights.......... Tendered Shares of any Series of Preferred may be
withdrawn at any time until the Expiration Date
with respect to such Series of Preferred and,
unless previously accepted for payment, may also be
withdrawn after March 28, 1997. See "Terms of the
Offer -- Withdrawal Rights."
Purpose of the Offer....... AEP is making the Offer because AEP believes that
the purchase of Shares is economically attractive
to OPCo and indirectly to AEP and its shareholders.
In addition, the Offer gives Preferred Shareholders
the opportunity to sell their Shares at a price
which AEP believes to be a premium over the market
price and without the usual transaction costs
associated with a market sale. See "Purpose of the
Offer; Certain Effects of the Offer."
Dividends.................. OPCo has declared the regular quarterly dividend on
each Series of Preferred to be paid on March 1,
1997 to holders of record as of the close of
business on February 12, 1997 (the "March 1997
Dividend"). A tender and purchase of Shares
pursuant to the Offer will not deprive a Preferred
Shareholder of his or her right to receive the
March 1997 Dividend on his or her Shares held of
record as of the close of business on February 12,
1997. Tendering Preferred Shareholders will be
entitled to any dividends accrued prior to the
Payment Date (as defined herein), in respect of any
later dividend periods (or any portion thereof).
Brokerage Commissions...... Not payable by Preferred Shareholders.
Solicitation Fee........... AEP will pay to each designated Soliciting Dealer
(as defined herein) a solicitation fee of $1.50 per
Share for Shares of the 4-1/2% Series, the 4.08%
Series, the 4.20% Series, and the 4.40% Series that
are tendered, accepted for payment and paid for
pursuant to the Offer (except that for transactions
for beneficial owners equal to or exceeding 5,000
Shares, AEP will pay a solicitation fee of $1.00
per Share for Shares of the 4-1/2% Series, the
4.08% Series, the 4.20% Series and the 4.40%
Series). AEP will pay a solicitation fee of $0.50
per Share for Shares of the 5.90% Series, the 6.02%
Series and the 6.35% Series that are tendered,
accepted for payment and paid for pursuant to the
Offer; provided, however, that any fee payable
pursuant to this sentence shall be paid 80% to the
Dealer Managers and 20% to any designated
Soliciting Dealer (which may be a Dealer Manager).
OPCo will pay a separate fee of $0.50 per Share for
Shares of the 4-1/2% Series, the 4.08% Series, the
4.20% Series and the 4.40% Series that are not
tendered pursuant to the Offer but which are voted
in favor of the Proposed Amendment. A Soliciting
Dealer will not be entitled to a solicitation fee
or a separate fee for Shares beneficially owned by
such Soliciting Dealer.
Proposed Amendment......... Concurrently with the Offer, the Board of Directors
of OPCo is soliciting proxies for use at the
Special Meeting of Shareholders of OPCo. The
Special Meeting is being held to consider an
amendment to OPCo's Articles which would remove a
provision that limits OPCo's ability to issue
unsecured debt. If the Proposed Amendment is
approved by the shareholders, the clause of the
Articles that places restrictions on OPCo's ability
to issue or assume indebtedness will be eliminated
with respect to any Shares that remain outstanding
after the consummation of the Offer. See "Purpose
of the Offer; Certain Effects of the Offer."
Record Date................ January 27, 1997
5
<PAGE> 6
Special Cash Payment....... Preferred Shareholders of record have the right to
vote for or against the Proposed Amendment
regardless of whether they tender their Shares. If
the Proposed Amendment is approved and adopted by
OPCo's shareholders, OPCo will make a special cash
payment of $1.00 per Share to each Preferred
Shareholder who voted in favor of the Proposed
Amendment but who did not tender his or her Shares
(the "Special Cash Payment"). Preferred
Shareholders who validly tender their Shares will
be entitled only to the purchase price per Share
listed on the front cover of this Offer to Purchase
and Proxy Statement plus an amount in cash
equivalent to any dividends accrued and unpaid
prior to the Payment Date.
Stock Transfer Tax......... Except as described herein, AEP will pay or cause
to be paid any stock transfer taxes with respect to
the sale and transfer of any Shares to it or its
order pursuant to the Offer. See Instruction 6 of
the applicable Letter of Transmittal. See "Terms of
the Offer -- Acceptance of Shares for Payment of
Purchase Price and Dividends."
Payment Date............... Promptly after the Expiration Date or any extension
thereof.
Further Information........ Additional copies of this Offer to Purchase and
Proxy Statement and the applicable Letter of
Transmittal may be obtained by contacting Morrow,
909 Third Avenue, New York, New York 10022-4799,
telephone (800) 566-9061 (toll free) and (212)
754-8000 (brokers and dealers). Questions about the
Offer should be directed to Merrill Lynch at (888)
ML4-TNDR (toll free) (888-654-8637 (toll free)) or
to Salomon Brothers at (800) 558-3745 (toll free).
6
<PAGE> 7
TERMS OF THE OFFER
NUMBER OF SHARES; PURCHASE PRICES; EXPIRATION DATE; DIVIDENDS
Upon the terms and subject to the conditions described herein and in the
applicable Letter of Transmittal, AEP will purchase any and all Shares that are
validly tendered on or prior to the applicable Expiration Date (and not properly
withdrawn in accordance with "Terms of the Offer -- Withdrawal Rights") at the
purchase price per Share listed on the front cover of this Offer to Purchase and
Proxy Statement for the Shares tendered, plus accrued and unpaid dividends for
the Shares tendered to the Payment Date, net to the seller in cash. See "Terms
of the Offer -- Certain Conditions of the Offer" and "Terms of the Offer --
Extension of Tender Period; Termination." On January 27, 1997, there were issued
and outstanding 202,403 Shares of the 4-1/2% Series of Preferred; 42,575 Shares
of the 4.08% Series of Preferred; 51,975 Shares of the 4.20% Series of
Preferred; 88,363 Shares of the 4.40% Series of Preferred; 404,000 Shares of the
5.90% Series of Preferred; 395,000 Shares of the 6.02% Series of Preferred; and
300,000 Shares of the 6.35% Series of Preferred.
THE OFFER FOR A SERIES OF PREFERRED IS NOT CONDITIONED UPON ANY MINIMUM
NUMBER OF SHARES OF SUCH SERIES OF PREFERRED BEING TENDERED AND IS INDEPENDENT
OF THE OFFER FOR ANY OTHER SERIES OF PREFERRED. THE OFFER, HOWEVER, IS
CONDITIONED UPON, AMONG OTHER THINGS, THE PROPOSED AMENDMENT, AS DESCRIBED
HEREIN, BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING. SEE "TERMS OF THE
OFFER -- CERTAIN CONDITIONS OF THE OFFER."
The Offer is being sent to all persons in whose names Shares are registered
on the books of OPCo as of the close of business on January 27, 1997 and
transferees of such persons. Only a record holder of Shares on the Record Date
may vote in person or by proxy at the Special Meeting. No record date is fixed
for determining which persons are permitted to tender Shares. Any person who is
the beneficial owner but not the record holder of Shares must arrange for the
record transfer of such Shares prior to tendering.
With respect to each Series of Preferred, the Expiration Date is the later
of 5:00 p.m. New York City time, on February 28, 1997 or the latest time and
date to which the Offer with respect to such Series of Preferred is extended.
AEP expressly reserves the right, in its sole discretion, and at any time and/or
from time to time, to extend the period of time during which the Offer for any
Series of Preferred is open, by giving oral or written notice of such extension
to the Depositary and making a public announcement thereof, without extending
the period of time during which the Offer for any other Series of Preferred is
open. There is no assurance whatsoever that AEP will exercise its right to
extend the Offer for any Series of Preferred. If AEP decides, in its sole
discretion, to (i) decrease the number of Shares of any Series of Preferred
being sought, (ii) increase or decrease the consideration offered in the Offer
to holders of any Series of Preferred or (iii) increase or decrease the
Soliciting Dealers' fees and, at the time that notice of such increase or
decrease is first published, sent or given to holders of such Series of
Preferred in the manner specified herein, the Offer for such Series of Preferred
is scheduled to expire at any time earlier than the tenth business day from the
date that such notice is first so published, sent or given, such Offer will be
extended until the expiration of such ten-business-day period. For purposes of
the Offer, a "business day" means any day other than a Saturday, Sunday or
federal holiday and consists of the time period from 12:00 a.m. through 11:59
p.m., New York City time.
NO ALTERNATIVE, CONDITIONAL OR CONTINGENT TENDERS WILL BE ACCEPTED.
The March 1997 Dividend has been declared on each Series of Preferred,
payable March 1, 1997 to holders of record as of the close of business on
February 12, 1997. A tender and purchase of Shares pursuant to the Offer will
not deprive such Preferred Shareholder of his or her right to receive the March
1, 1997 Dividend on his or her Shares, regardless of when such tender is made.
Tendering Preferred Shareholders will be entitled to any dividends accrued prior
to the Payment Date in respect of any later dividend periods (or any portion
thereof).
7
<PAGE> 8
PROCEDURE FOR TENDERING SHARES
To tender Shares pursuant to the Offer, the tendering owner of Shares must
either:
(a) send to the Depositary (at one of its addresses set forth on the
back cover of this Offer to Purchase and Proxy Statement) a properly
completed and duly executed Letter of Transmittal, together with any
required signature guarantees and any other documents required by the
Letter of Transmittal and either (i) certificates for the Shares to be
tendered must be received by the Depositary at one of such addresses or
(ii) such Shares must be delivered pursuant to the procedures for
book-entry transfer described herein (and a confirmation of such delivery
must be received by the Depositary), in each case by the Expiration Date;
or
(b) comply with the guaranteed delivery procedure described under
"Guaranteed Delivery Procedure" below.
A tender of Shares made pursuant to any method of delivery set forth herein
or in the Letter of Transmittal will constitute a binding agreement between the
tendering holder and AEP upon the terms and subject to the conditions of the
Offer.
The Depositary will establish an account with respect to the Shares at The
Depository Trust Company and the Philadelphia Depository Trust Company (each a
"Book-Entry Transfer Facility") for purposes of the Offer within two business
days after the date of this Offer to Purchase and Proxy Statement, and any
financial institution that is a participant in the system of a Book-Entry
Transfer Facility may make delivery of Shares by causing such Book-Entry
Transfer Facility to transfer such Shares into the Depositary's account in
accordance with the procedures of such Book-Entry Transfer Facility. Although
delivery of Shares may be effected through book-entry transfer, such delivery
must be accompanied by either (i) a properly completed and duly executed Letter
of Transmittal, together with any required signature guarantees and any other
required documents or (ii) an Agent's Message (as hereinafter defined) and, in
any case, must be received by the Depositary at one of its addresses set forth
on the back cover of this Offer to Purchase and Proxy Statement on or prior to
the Expiration Date. DELIVERY OF SUCH LETTER OF TRANSMITTAL AND ANY OTHER
REQUIRED DOCUMENTS TO A BOOK-ENTRY TRANSFER FACILITY OR TO AEP DOES NOT
CONSTITUTE DELIVERY TO THE DEPOSITARY.
The term "Agent's Message" means a message, transmitted by a Book-Entry
Transfer Facility, received by the Depositary and forming a part of the
book-entry transfer when a tender is initiated, which states that such
Book-Entry Transfer Facility has received an express acknowledgment from a
participant tendering Shares that such participant has received and agrees to be
bound by the terms of the Letter of Transmittal and that AEP may enforce such
agreement against such participant.
Except as otherwise provided below, all signatures on a Letter of
Transmittal must be guaranteed by a firm that is a member of a registered
national securities exchange or the National Association of Securities Dealers,
Inc. ("NASD"), or by a commercial bank or trust company having an office or
correspondent in the United States that is a participant in an approved
Signature Guarantee Medallion Program (each of the foregoing being referred to
as an "Eligible Institution"). Signatures on a Letter of Transmittal need not be
guaranteed if (a) the Letter of Transmittal is signed by the registered owner of
the shares tendered therewith and such owner has not completed the box entitled
"Special Payment Instructions" or the box entitled "Special Delivery
Instructions" on the Letter of Transmittal or (b) such Shares are tendered for
the account of an Eligible Institution. See Instructions 1 and 5 of the Letter
of Transmittal. If Shares are registered in the name of a person other than the
signatory on the Letter of Transmittal, or if unpurchased Shares are to be
issued to a person other than the registered holder(s), the certificates must be
endorsed or accompanied by appropriate stock powers, in either case signed
exactly as the name or names of the registered holder(s) appear on the Shares
with the signature(s) on the Shares or stock powers guaranteed as stated above.
See Instructions 4, 6 and 7 to the Letter of Transmittal.
Guaranteed Delivery Procedure. If a Preferred Shareholder desires to
tender Shares pursuant to the Offer and such Preferred Shareholder's
certificates are not immediately available or the procedures for book-entry
transfer cannot be completed on a timely basis or time will not permit all
required documents to
8
<PAGE> 9
reach the Depositary prior to the Expiration Date, such Shares may nevertheless
be tendered if all of the following guaranteed delivery procedures are complied
with:
(i) such tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form provided by AEP and OPCo herewith, is
received (with any required signatures or signature guarantees) by the
Depositary as provided below on or prior to the Expiration Date; and
(iii) the certificates for all tendered Shares in proper form for
transfer or a Book-Entry Confirmation with respect to all tendered Shares,
together with a properly completed and duly executed Letter of Transmittal
and any other documents required by the Letter of Transmittal, are received
by the Depositary no later than 5:00 p.m., New York City time, within three
business days after the date of execution of such Notice of Guaranteed
Delivery.
THE NOTICE OF GUARANTEED DELIVERY MAY BE DELIVERED BY HAND OR MAILED TO THE
DEPOSITARY AND MUST INCLUDE AN ENDORSEMENT BY AN ELIGIBLE INSTITUTION IN THE
FORM SET FORTH IN SUCH NOTICE OF GUARANTEED DELIVERY.
In all cases, Shares shall not be deemed validly tendered unless a properly
completed and duly executed Letter of Transmittal or, if applicable, an Agent's
Message, is received by the Depositary.
Notwithstanding any other provision hereof, payment for Shares accepted for
payment pursuant to the Offer in all cases will be made only after timely
receipt by the Depositary of certificates for (or an Agent's Message with
respect to) such Shares, a Letter of Transmittal, properly completed and duly
executed, with any required signature guarantees and all other documents
required by the Letter of Transmittal.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF DELIVERY IS BY MAIL,
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED.
BECAUSE IT IS THE TIME OF RECEIPT, NOT THE TIME OF MAILING, WHICH DETERMINES
WHETHER A TENDER HAS BEEN MADE PRIOR TO THE EXPIRATION DATE, SUFFICIENT TIME
SHOULD BE ALLOWED TO ASSURE TIMELY DELIVERY.
TO AVOID FEDERAL INCOME TAX BACKUP WITHHOLDING EQUAL TO 31% OF THE GROSS
PAYMENTS MADE PURSUANT TO THE OFFER, EACH TENDERING PREFERRED SHAREHOLDER WHO IS
A UNITED STATES PERSON MUST NOTIFY THE DEPOSITARY OF SUCH PREFERRED
SHAREHOLDER'S CORRECT TAXPAYER IDENTIFICATION NUMBER AND PROVIDE CERTAIN OTHER
INFORMATION BY PROPERLY COMPLETING AND EXECUTING THE SUBSTITUTE FORM W-9
INCLUDED IN THE LETTER OF TRANSMITTAL (OR, IN THE CASE OF A FOREIGN PREFERRED
SHAREHOLDER, FORM W-8 OBTAINABLE FROM THE DEPOSITARY). SEE "CERTAIN FEDERAL
INCOME TAX CONSEQUENCES."
EACH PREFERRED SHAREHOLDER IS URGED TO CONSULT WITH HIS OR HER OWN TAX
ADVISOR REGARDING THE TAX CONSEQUENCES OF THE OFFER.
All questions as to the form of documents and the validity, eligibility
(including the time of receipt) and acceptance for payment of any tender of
Shares will be determined by AEP, in its sole discretion, and its determination
will be final and binding. AEP reserves the absolute right to reject any or all
tenders of Shares that (i) it determines are not in proper form or (ii) the
acceptance for payment of or payment for which may, in the opinion of AEP's
counsel, be unlawful. AEP also reserves the absolute right to waive any defect
or irregularity in any tender of Shares. None of AEP, OPCo, the Dealer Managers,
the Depositary, the Information Agent or any other person will be under any duty
to give notice of any defect or irregularity in tenders, nor shall any of them
incur any liability for failure to give any such notice.
9
<PAGE> 10
WITHDRAWAL RIGHTS
Tenders of Shares made pursuant to the Offer may be withdrawn at any time
prior to the Expiration Date. Thereafter, such tenders are irrevocable, except
that they may be withdrawn after March 28, 1997, unless previously accepted for
payment as provided in this Offer to Purchase and Proxy Statement.
To be effective, a written notice of withdrawal must be timely received by
the Depositary, at one of its addresses set forth on the back cover of this
Offer to Purchase and Proxy Statement, and must specify the name of the person
who tendered the Shares to be withdrawn and the number of Shares to be
withdrawn. If the Shares to be withdrawn have been delivered to the Depositary,
a signed notice of withdrawal with signatures guaranteed by an Eligible
Institution (except in the case of Shares tendered by an Eligible Institution)
must be submitted prior to the release of such Shares. In addition, such notice
must specify, in the case of Shares tendered by delivery of certificates, the
name of the registered owner (if different from that of the tendering Preferred
Shareholder) and the serial numbers shown on the particular certificates
evidencing the Shares to be withdrawn or, in the case of Shares tendered by
book-entry transfer, the name and number of the account at the Book-Entry
Transfer Facility to be credited with the withdrawn Shares and the name of the
registered holder (if different from the name of such account). Withdrawals may
not be rescinded, and Shares withdrawn will thereafter be deemed not validly
tendered for purposes of the Offer. However, withdrawn Shares may be re-tendered
by again following one of the procedures described in "Terms of the Offer --
Procedure for Tendering Shares" at any time prior to the Expiration Date.
All questions as to the form and validity (including time of receipt) of
any notice of withdrawal will be determined by AEP, in its sole discretion, and
its determination will be final and binding. None of AEP, OPCo, the Dealer
Managers, the Depositary, the Information Agent or any other person will be
under any duty to give notification of any defect or irregularity in any notice
of withdrawal or will incur any liability for failure to give any such
notification.
ACCEPTANCE OF SHARES FOR PAYMENT AND PAYMENT OF PURCHASE PRICE AND DIVIDENDS
Upon the terms and subject to the conditions of the Offer, and as promptly
as practicable after the Expiration Date, AEP will accept for payment (and
thereby purchase) and pay for Shares validly tendered and not withdrawn as
permitted in "Terms of the Offer -- Withdrawal Rights." Thereafter, payment for
all Shares validly tendered on or prior to the Expiration Date and accepted
pursuant to the Offer will be made by the Depositary by check as promptly as
practicable after the Expiration Date. In all cases, payment for Shares accepted
for payment pursuant to the Offer will be made promptly but only after timely
receipt by the Depositary of certificates for such Shares (or of an Agent's
Message), a properly completed and duly executed Letter of Transmittal and any
other required documents.
For purposes of the Offer, AEP will be deemed to have accepted for payment
(and thereby purchased) Shares that are validly tendered and not withdrawn as,
if and when it gives oral or written notice to the Depositary of its acceptance
for payment of such Shares. AEP will pay for Shares that it has purchased
pursuant to the Offer by depositing the purchase price therefor plus accrued and
unpaid dividends thereon with the Depositary, which will act as agent for
tendering Preferred Shareholders for the purpose of receiving payment from AEP
and transmitting payment to tendering Preferred Shareholders. Under no
circumstances will interest be paid on amounts to be paid to tendering Preferred
Shareholders, regardless of any delay in making such payment.
Certificates for all Shares not validly tendered will be returned or, in
the case of Shares tendered by book-entry transfer, such Shares will be credited
to an account maintained with a Book-Entry Transfer Facility, as promptly as
practicable, without expense to the tendering Preferred Shareholder.
If certain events occur, AEP may not be obligated to purchase Shares
pursuant to the Offer. See "Terms of the Offer -- Certain Conditions of the
Offer."
AEP will pay or cause to be paid any stock transfer taxes with respect to
the sale and transfer of any Shares to it or its order pursuant to the Offer.
If, however, payment of the purchase price is to be made to, or Shares not
tendered or not purchased are to be registered in the name of, any person other
than the registered
10
<PAGE> 11
owner, or if tendered Shares are registered in the name of any person other than
the person signing the Letter of Transmittal, the amount of any stock transfer
taxes (whether imposed on the registered owner, such other person or otherwise)
payable on account of the transfer to such person will be deducted from the
purchase price unless satisfactory evidence of the payment of such taxes, or
exemption therefrom, is submitted. See Instruction 6 of the accompanying Letter
of Transmittal.
CERTAIN CONDITIONS OF THE OFFER
AEP WILL NOT BE REQUIRED TO ACCEPT FOR PAYMENT OR PAY FOR ANY SHARES
TENDERED IF THE PROPOSED AMENDMENT IS NOT APPROVED AND ADOPTED AT THE SPECIAL
MEETING.
PREFERRED SHAREHOLDERS OF RECORD HAVE THE RIGHT TO VOTE FOR OR AGAINST THE
PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES. IF THE
PROPOSED AMENDMENT IS APPROVED AND ADOPTED, OPCO WILL MAKE A SPECIAL CASH
PAYMENT TO EACH PREFERRED SHAREHOLDER WHO VOTED IN FAVOR OF THE PROPOSED
AMENDMENT, PROVIDED THAT THEIR SHARES HAVE NOT BEEN TENDERED PURSUANT TO THE
OFFER. PREFERRED SHAREHOLDERS WHO TENDER THEIR SHARES WILL ONLY BE ENTITLED TO
THE PURCHASE PRICE PER SHARE LISTED ON THE FRONT COVER OF THIS OFFER TO PURCHASE
AND PROXY STATEMENT.
In addition, notwithstanding any other provision of the Offer, AEP will not
be required to accept for payment or pay for any Shares tendered, and may
terminate or amend the Offer (by oral or written notice to the Depositary and
timely public announcement) or may postpone (subject to the requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") for prompt
payment for or return of Shares) the acceptance for payment of, or payment for,
Shares tendered, if at any time after January 29, 1997, and at or before the
Expiration Date, any of the following shall have occurred (which shall not have
been waived by AEP):
(a) there shall have been threatened, instituted or pending any action
or proceeding by any government or governmental, regulatory or
administrative agency, authority or tribunal or any other person, domestic
or foreign, or before any court, authority, agency or tribunal that (i)
challenges the acquisition of Shares pursuant to the Offer or otherwise in
any manner relates to or affects the Offer or (ii) in the reasonable
judgment of AEP, would or might materially and adversely affect the
business, condition (financial or otherwise), income, operations or
prospects of AEP and its subsidiaries taken as a whole, or otherwise
materially impair in any way the contemplated future conduct of the
business of AEP or any of its subsidiaries or materially impair the Offer's
contemplated benefits to AEP;
(b) there shall have been any action threatened, pending or taken, or
approval withheld, or any statute, rule, regulation, judgment, order or
injunction threatened, proposed, sought, promulgated, enacted, entered,
amended, enforced or deemed to be applicable to the Offer or AEP or any of
its subsidiaries, by any legislative body, court, authority, agency or
tribunal that, in AEP's reasonable judgment, would or might directly or
indirectly (i) make the acceptance for payment of, or payment for, some or
all of the Shares illegal or otherwise restrict or prohibit consummation of
the Offer; (ii) delay or restrict the ability of AEP, or render AEP unable,
to accept for payment or pay for some or all of the Shares; (iii)
materially impair the contemplated benefits of the Offer to AEP or OPCo
(including materially increasing the effective interest cost of certain
types of unsecured debt); or (iv) materially affect the business, condition
(financial or otherwise), income, operations or prospects of AEP and its
subsidiaries taken as a whole, or otherwise materially impair in any way
the contemplated future conduct of the business of AEP or any of its
subsidiaries;
(c) there shall have occurred (i) any significant decrease in the
market price of the Shares, (ii) any change in the general political,
market, economic or financial conditions in the United States or abroad
that, in the reasonable judgment of AEP, would or might have a material
adverse effect on AEP's business, operations, prospects or ability to
obtain financing generally or the trading in the Shares or other
11
<PAGE> 12
equity securities of AEP; (iii) the declaration of a banking moratorium or
any suspension of payments in respect of banks in the United States or any
limitation on, or any event that, in AEP's reasonable judgment, would or
might affect the extension of credit by lending institutions in the United
States; (iv) the commencement of war, armed hostilities or other
international or national calamity directly or indirectly involving the
United States; (v) any general suspension of trading in, or limitation on
prices for, securities on any national securities exchange or in the
over-the-counter market; (vi) in the case of any of the foregoing existing
at the time of the commencement of the Offer, in AEP's reasonable judgment,
a material acceleration or worsening thereof; (vii) any decline in either
the Dow Jones Industrial Average or the Standard and Poor's Composite 500
Stock Index by an amount in excess of 15% measured from the close of
business on January 29, 1997; or (viii) a decline in the ratings accorded
any of AEP's or OPCo's securities by Standard & Poor's Rating Services
("S&P"), Moody's Investors Service, Inc. ("Moody's") or Duff & Phelps, Inc.
("D&P") or that S&P, Moody's or D&P has announced that it has placed any
such rating under surveillance or review with negative implications.
(d) any tender or exchange offer with respect to some or all of the
Shares (other than the Offer) or other equity securities of AEP, or a
merger, acquisition or other business combination proposal for AEP, shall
have been proposed, announced or made by any person or entity;
(e) there shall have occurred any event or events that have resulted,
or, in AEP's reasonable judgment, may result, in an actual or threatened
change in the business, condition (financial or otherwise), income,
operations, stock ownership or prospects of AEP and its subsidiaries; or
(f) the Securities and Exchange Commission (the "SEC") shall have
withheld approval, under the Holding Company Act, of the acquisition of the
Shares by AEP pursuant to the Offer or the approval and adoption of the
Proposed Amendment at the Special Meeting or the issuance of short-term
debt by AEP and/or OPCo;
and, in the sole judgment of AEP, such event or events make it undesirable or
inadvisable to proceed with the Offer or with such acceptance for payment or
payment. With respect to the approval of the SEC referenced in clause (f) above,
the SEC must find that the acquisition of the Shares by AEP is not detrimental
to the public interest or the interests of the investors or consumers, and that
the consideration paid in connection with the acquisition and the adoption of
the Proposed Amendment, including fees, commissions and other remuneration, is
reasonable.
The foregoing conditions (including the condition that the Proposed
Amendment be approved and adopted at the Special Meeting) are for the sole
benefit of AEP and may be asserted by AEP regardless of the circumstances
(including any action or inaction by AEP) giving rise to any such condition, and
any such condition may be waived by AEP, in whole or in part, at any time and
from time to time in its sole discretion. A decision by AEP to terminate or
otherwise amend any Offer, following the occurrence of any of the foregoing,
with respect to one Series of Preferred will not create an obligation on behalf
of AEP to terminate or otherwise amend in a similar manner the Offer with
respect to any other Series of Preferred. The failure by AEP at any time to
exercise any of the foregoing rights shall not be deemed a waiver of any such
right and each such right shall be deemed an ongoing right which may be asserted
at any time and from time to time. Any determination by AEP concerning the
events described above will be final and binding on all parties.
EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENTS
AEP expressly reserves the right, in its sole discretion, and at any time
and/or from time to time prior to the Expiration Date, to extend the period of
time during which the Offer for any Series of Preferred is open by giving oral
or written notice of such extension to the Depositary, without extending the
period of time during which the Offer for any other Series of Preferred is open.
There can be no assurance, however, that AEP will exercise its right to extend
the Offer for any Series of Preferred. During any such extension, all Shares of
the subject Series of Preferred previously tendered will remain subject to the
Offer, except to the extent that such Shares may be withdrawn as set forth in
"Terms of the Offer -- Withdrawal Rights."
AEP also expressly reserves the right, in its sole discretion, to, among
other things, terminate the Offer and not accept for payment or pay for any
Shares tendered, subject to Rule 13e-4(f)(5) under the Exchange Act, which
requires AEP either to pay the consideration offered or to return the Shares
tendered promptly
12
<PAGE> 13
after the termination or withdrawal of the Offer upon the occurrence of any of
the conditions specified in "Terms of the Offer -- Certain Conditions of the
Offer" by giving oral or written notice of such termination to the Depositary,
and making a public announcement thereof.
Subject to compliance with applicable law, AEP further reserves the right,
in its sole discretion, to amend the Offer in any respect. Amendments to the
Offer may be made at any time and/or from time to time effected by public
announcement thereof, such announcement, in the case of an extension, to be
issued no later than 9:00 a.m., New York City time, on the next business day
after the previously scheduled Expiration Date. Any public announcement made
pursuant to the Offer will be disseminated promptly to Preferred Shareholders
affected thereby in a manner reasonably designed to inform such Preferred
Shareholders of such change. Without limiting the manner in which AEP may choose
to make a public announcement, except as required by applicable law, AEP shall
have no obligation to publish, advertise or otherwise communicate any such
public announcement other than by making a release to the Dow Jones News
Service.
If AEP materially changes the terms of the Offer or the information
concerning the Offer, or if it waives a material condition of the Offer, AEP
will extend the Offer to the extent required by Rules 13e-4(d)(2) and
13e-4(e)(2) under the Exchange Act. Those rules require that the minimum period
during which the Offer must remain open following material changes in the terms
of the Offer or information concerning the Offer (other than a change in price,
a change in percentage of securities sought or a change in the dealer's
solicitation fee) will depend on the facts and circumstances, including the
relative materiality of such terms or information. The SEC has stated that, in
its view, an offer should remain open for a minimum of five business days from
the date that a notice of such a material change is first published, sent or
given. If the Offer is scheduled to expire at any time earlier than the
expiration of a period ending on the tenth business day from, and including, the
date that AEP publishes, sends or gives to Preferred Shareholders a notice that
it will (i) increase or decrease the price it will pay for Shares, (ii) decrease
the percentage of Shares it seeks or (iii) increase or decrease the soliciting
dealers' Fees, the Offer will be extended until the expiration of such period of
ten business days. THE OFFER FOR EACH SERIES OF PREFERRED IS INDEPENDENT OF THE
OFFER FOR ANY OTHER SERIES OF PREFERRED. IF AEP EXTENDS OR AMENDS ANY OFFER WITH
RESPECT TO ONE SERIES OF PREFERRED FOR ANY REASON, AEP WILL HAVE NO OBLIGATION
TO EXTEND THE OFFER FOR ANY OTHER SERIES OF PREFERRED.
PROPOSED AMENDMENTS AND PROXY SOLICITATION
INTRODUCTION
This Offer to Purchase and Proxy Statement is first being mailed on or
about January 30, 1997 to the shareholders of OPCo in connection with the
solicitation of proxies by the Board of Directors of OPCo (the "Board") for use
at the Special Meeting. At the Special Meeting, the shareholders of record of
OPCo will vote upon the Proposed Amendment to the Articles and the Second
Proposed Amendment to the Articles. The Second Proposed Amendment is Independent
of the Offer and the Proposed Amendment, and neither the Offer nor the Proposed
Amendment is in any way conditioned upon the Second Proposed Amendment being
approved and adopted at the Special Meeting.
While Preferred Shareholders who wish to tender their Shares pursuant to
the Offer are not required to vote in favor of or against the Proposed
Amendment, the Offer is conditioned upon the Proposed Amendment being approved
and adopted at the Special Meeting. In addition, Preferred Shareholders of
record have the right to vote for or against the Proposed Amendment regardless
of whether they tender their Shares. If the Proposed Amendment is approved and
adopted by OPCo's shareholders, OPCo will make a special cash payment in the
amount of $1.00 per Share (the "Special Cash Payment") to each Preferred
Shareholder of record who voted in favor of the Proposed Amendment, provided
that such Shares have not been tendered pursuant to the Offer. If a Preferred
Shareholder votes against the Proposed Amendment or abstains, such Preferred
Shareholder shall not be entitled to the Special Cash Payment (regardless of
whether the Proposed Amendment is approved and adopted). Those Preferred
Shareholders who validly tender their Shares will be entitled only to the
purchase price per Share listed on the front cover of this Offer to Purchase and
Proxy Statement.
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<PAGE> 14
VOTING SECURITIES, RIGHTS AND PROCEDURES
Only holders of record of OPCo's voting securities at the close of business
on January 27, 1997 (the "Record Date") will be entitled to vote in person or by
proxy at the Special Meeting. The outstanding voting securities of OPCo are
divided into two classes: common stock and cumulative preferred stock. The class
of cumulative preferred stock has been issued in the seven Series of Preferred
with the record holders of all Shares of the cumulative preferred stock voting
together as one class. The shares outstanding as of the Record Date, and the
vote to which each share is entitled in consideration of the Proposed Amendment
and the Second Proposed Amendment, are as follows:
<TABLE>
<CAPTION>
CLASS SHARES OUTSTANDING VOTES PER SHARE
- ------------------------------------------------------------- ------------------ ---------------
<S> <C> <C>
Common Stock (No Par Value).................................. 27,952,473 1 vote
Cumulative Preferred Stock (Par Value $100 Per Share)........ 1,484,316 1 vote
</TABLE>
The affirmative vote of the holders of at least two-thirds of the
outstanding shares of each of OPCo's (i) common stock and (ii) cumulative
preferred stock, all series voting together as one class, is required to approve
the Proposed Amendment to be presented at the Special Meeting. Abstentions and
broker non-votes will have the effect of votes against the Proposed Amendment.
AEP HAS ADVISED OPCO THAT IT INTENDS TO VOTE ALL OF THE OUTSTANDING SHARES OF
COMMON STOCK OF OPCO IN FAVOR OF THE PROPOSED AMENDMENT.
The affirmative vote of the holders of at least a majority of the
outstanding shares of OPCo's common stock and cumulative preferred stock, the
common stock and preferred stock voting together as one class, is required to
approve the Second Proposed Amendment to be presented at the Special Meeting.
Abstentions and broker non-votes will have the effect of votes against the
Second Proposed Amendment. AEP HAS ADVISED OPCO THAT IT INTENDS TO VOTE ALL OF
THE OUTSTANDING SHARES OF COMMON STOCK OF OPCO IN FAVOR OF THE SECOND PROPOSED
AMENDMENT.
Votes at the Special Meeting will be tabulated preliminarily by the
Depositary. Inspectors of Election, duly appointed by the presiding officer of
the Special Meeting, will definitively count and tabulate the votes and
determine and announce the results at the Special Meeting. OPCo has no
established procedure for confidential voting. There are no rights of appraisal
in connection with the Proposed Amendment, or the Second Proposed Amendment.
PROXIES
THE ENCLOSED PROXY IS SOLICITED BY OPCO'S BOARD, WHICH RECOMMENDS VOTING
FOR THE PROPOSED AMENDMENT AND THE SECOND PROPOSED AMENDMENT. ALL SHARES OF
OPCO'S COMMON STOCK WILL BE VOTED IN FAVOR OF THE PROPOSED AMENDMENT AND THE
SECOND PROPOSED AMENDMENT. Shares of OPCo's cumulative preferred stock
represented by properly executed proxies received at or prior to the Special
Meeting will be voted in accordance with the instructions thereon. If no
instructions are indicated, duly executed proxies will be voted in accordance
with the recommendation of the Board. It is not anticipated that any other
matters will be brought before the Special Meeting. However, the enclosed proxy
gives discretionary authority to the proxy holders named therein should any
other matters be presented at the Special Meeting, and it is the intention of
the proxy holders to act on any other matters in accordance with their best
judgment.
THE SECOND PROPOSED AMENDMENT IS INDEPENDENT OF THE OFFER AND THE PROPOSED
AMENDMENT, AND NEITHER THE OFFER NOR THE PROPOSED AMENDMENT IS ANY WAY
CONDITIONED UPON THE SECOND PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE
SPECIAL MEETING.
Execution of a proxy will not prevent a shareholder from attending the
Special Meeting and voting in person. Any shareholder giving a proxy may revoke
it at any time before it is voted by delivering to the Secretary of OPCo written
notice of revocation bearing a later date than the proxy, by delivering a duly
executed proxy bearing a later date, or by voting in person by ballot at the
Special Meeting. Withdrawal of Shares tendered pursuant to the Offer will not
revoke a properly executed proxy.
14
<PAGE> 15
OPCo will bear the cost of the solicitation of proxies by the Board. OPCo
has engaged Morrow & Co., Inc. to act as Information Agent in connection with
the solicitation of proxies for a fee of $5,800, plus reimbursement of
reasonable out-of-pocket expenses. Proxies will be solicited by mail or by
telephone. In addition, officers and employees of OPCo may also solicit proxies
personally or by telephone; such persons will receive no additional compensation
for these services. The Information Agent has not been retained to make, and
will not make, solicitations or recommendations in connection with the Proposed
Amendment.
OPCo has requested that brokerage houses and other custodians, nominees and
fiduciaries forward solicitation materials to the beneficial owners of shares of
OPCo's cumulative preferred stock held of record by such persons and will
reimburse such brokers and other fiduciaries for their reasonable out-of-pocket
expenses incurred in connection therewith.
The solicitation of proxies has been approved by the SEC under the Holding
Company Act. An application has been filed with the SEC under the Holding
Company Act requesting approval of the Proposed Amendment, the Second Proposed
Amendment and the acquisition of the Shares by AEP pursuant to the Offer.
SPECIAL CASH PAYMENTS
Subject to the terms and conditions set forth in this Offer to Purchase and
Proxy Statement, if (but only if) the Proposed Amendment is approved and adopted
by the shareholders of OPCo, OPCo will make a Special Cash Payment to each
Preferred Shareholder who voted in favor of the Proposed Amendment, in person by
ballot or by proxy, at the Special Meeting in the amount of $1.00 for each Share
held by such Preferred Shareholder on the Record Date which is so voted,
provided that such Shares have not been tendered pursuant to the Offer. SPECIAL
CASH PAYMENTS WILL BE MADE TO PREFERRED SHAREHOLDERS AS OF THE RECORD DATE (IF
SUCH SHARES HAVE NOT BEEN TENDERED PURSUANT TO THE OFFER) ONLY IN RESPECT OF
EACH SHARE WHICH IS VOTED FOR THE ADOPTION OF THE PROPOSED AMENDMENT; PROVIDED,
HOWEVER, THAT THOSE PREFERRED SHAREHOLDERS WHO VALIDLY TENDER THEIR SHARES WILL
BE ENTITLED ONLY TO THE PURCHASE PRICE PER SHARE LISTED ON THE FRONT COVER OF
THIS OFFER TO PURCHASE AND PROXY STATEMENT. If the Proposed Amendment is
approved and adopted, Special Cash Payments will be paid out of OPCo's general
funds, promptly after the Proposed Amendment shall have become effective.
However, no accrued interest will be paid on the Special Cash Payments
regardless of any delay in making such payments.
Only Preferred Shareholders on the Record Date (or their legal
representatives or attorneys-in-fact) are entitled to vote at the Special
Meeting and to receive Special Cash Payments from OPCo. Any beneficial holder of
Shares who is not the registered holder of such Shares as of the Record Date (as
would be the case for any beneficial holder whose Shares are registered in the
name of such holder's broker, dealer, commercial bank, trust company or other
nominee) must arrange with the record Preferred Shareholder to execute and
deliver a proxy form on such beneficial owner's behalf. If a beneficial holder
of Shares intends to attend the Special Meeting and vote in person, such
beneficial holder must obtain a legal proxy form from his or her broker, dealer,
commercial bank, trust company or other nominee.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As noted above, AEP owns all the outstanding common stock of OPCo.
Pursuant to Section 13(d) of the Exchange Act, a beneficial owner of a
security is any person who directly or indirectly has or shares voting or
investment power over such security. No person or group is known by management
of OPCo to be the beneficial owner of more than 5% of the Shares as of the
Record Date.
15
<PAGE> 16
OPCo's directors and executive officers do not beneficially own any Shares
as of the Record Date. The beneficial ownership of AEP's common stock held by
each director, as well as directors and executive officers as a group, as of
December 31, 1996, is set forth in the following table. Fractions of shares have
been rounded to the nearest whole number.
<TABLE>
<CAPTION>
NAME (1) SHARES
------------------------------------------------------------- -------
<S> <C>
P. J. DeMaria................................................ 7,603(a)(c)
E. L. Draper, Jr. ........................................... 6,793(a)(b)(c)(d)
H. W. Fayne.................................................. 3,985(a)
W. J. Lhota.................................................. 14,053(a)(b)(c)
G. P. Maloney................................................ 5,512(a)(b)(c)
J. J. Markowsky.............................................. 7,124(a)(d)
J. H. Vipperman.............................................. 5,510(a)(c)
All directors and executive officers as a group.............. 135,810(e)
</TABLE>
- ---------------
(a) Includes shares and share equivalents held in the following plans in the
amounts listed below:
<TABLE>
<CAPTION>
AEP EMPLOYEE AEP PERFORMANCE AEP EMPLOYEE
STOCK OWNERSHIP SHARE INCENTIVE SAVINGS PLAN
PLAN (SHARES) PLAN (SHARES) (SHARE EQUIVALENTS)
--------------- --------------- -------------------
<S> <C> <C> <C>
Mr. DeMaria............................. 90 881 2,945
Dr. Draper.............................. -- 2,050 2,383
Mr. Fayne............................... 68 372 3,463
Mr. Lhota............................... 64 812 11,809
Mr. Maloney............................. 92 867 3,053
Dr. Markowsky........................... 71 775 6,154
Mr. Vipperman........................... 86 527 4,766
All Directors and
Executive Officers.................... 471 6,284 34,573
</TABLE>
With respect to the shares and share equivalents held in these plans, such
persons have sole voting power, but the investment/disposition power is
subject to the terms of such plans.
(b) Does not include, for Messrs. DeMaria, Lhota and Maloney, 85,231 shares in
the American Electric Power System Educational Trust Fund over which Messrs.
DeMaria, Lhota and Maloney share voting and investment power as trustees
(they disclaim beneficial ownership). The amount of shares shown for all
directors and executive officers as a group includes these shares.
(c) Includes the following numbers of shares held in joint tenancy with a family
member: Mr. DeMaria, 1,232; Dr. Draper, 2,083; Mr. Lhota, 1,368; Mr.
Maloney, 1,500; and Mr. Vipperman, 60.
(d) Includes the following numbers of shares held by family members over which
beneficial ownership is disclaimed: Mr. DeMaria, 2,392 and Dr. Markowsky,
18.
(e) Represents less than 1% of the total number of shares outstanding.
BUSINESS TO COME BEFORE THE SPECIAL MEETING
The following Proposed Amendment to the Articles is one of two items of
business expected to be presented at the Special Meeting:
To remove in its entirety ARTICLE FOURTH, Clause 7(B)(b), limiting OPCo's
ability to issue unsecured indebtedness.
The following Second Proposed Amendment to the Articles is the second of
two items of business expected to be presented at the Special Meeting:
To add a paragraph to the end of ARTICLE FOURTH, Clause 3, clarifying the
authority of the Board of Directors to purchase or otherwise acquire
Shares.
16
<PAGE> 17
THE FOLLOWING STATEMENTS, UNLESS THE CONTEXT OTHERWISE REQUIRES, ARE
SUMMARIES OF THE SUBSTANCE OR GENERAL EFFECT OF A PROVISION OF THE ARTICLES, AND
ARE QUALIFIED IN THEIR ENTIRETY BY THE ARTICLES AND CLAUSE 7(B)(b) (AS DESCRIBED
BELOW).
EXPLANATION OF THE PROPOSED AMENDMENT
ARTICLE FOURTH, Clause 7(B)(b) of the Articles currently provides that, so
long as any shares of OPCo's cumulative preferred stock are outstanding, OPCo
shall not, without the consent of the holders of a majority of the total number
of votes which holders of the outstanding shares of OPCo cumulative preferred
stock are entitled to cast, issue or assume any unsecured debt securities (other
than for purposes of the reacquisition, redemption or other retirement of any
evidences of indebtedness theretofore issued or assumed by OPCo or the
reacquisition, redemption or other retirement of all outstanding shares of OPCo
cumulative preferred stock) if, immediately after such issue or assumption, the
total principal amount of all unsecured debt securities (other than the
principal amount of all long-term unsecured debt securities not in excess of 10%
of the capitalization of OPCo) issued or assumed by OPCo and then outstanding
would exceed 10% of the capitalization of OPCo (the "Debt Limitation
Provision").
The Proposed Amendment, if adopted, would eliminate in its entirety clause
7(B)(b), as set forth below, from the Articles. Unless otherwise defined,
capitalized terms used in Clause 7(B) are used as defined in the Articles.
ARTICLE FOURTH, Clause 7(B) of the Articles states:
"(B) So long as any shares of the Cumulative Preferred Stock are
outstanding, the Corporation shall not, without the consent (given by vote
at a meeting called for that purpose) of the holders of a majority of the
total number of votes which holders of the outstanding shares of Cumulative
Preferred Stock are entitled to cast, voting together for such purpose as a
single class:
. . .
(b) Issue or assume any unsecured debt securities for purposes
other than
(i) the reacquisition, redemption or other retirement of any
evidences of indebtedness theretofore issued or assumed by the
Corporation, or
(ii) the reacquisition, redemption or other retirement of all
outstanding shares of the Cumulative Preferred Stock,
if, immediately after such issue or assumption, the total principal
amount of all unsecured debt securities (other than the principal
amount of all long-term unsecured debt securities not in excess of
10% of the Capitalization of the Corporation) issued or assumed by
the Corporation and then outstanding would exceed 10% of the
Capitalization of the Corporation.
For purposes of this subparagraph (b) only:
(I) "unsecured debt securities" shall be deemed to mean any
unsecured notes, debentures, or other securities representing
unsecured indebtedness, but shall not include contractual
commitments and agreements for the purchase of property,
materials, power, energy or equipment to be used, consumed or
resold in the ordinary course of the Corporation's business;
(II) "long-term unsecured debt securities" shall be deemed
to mean all unsecured debt securities, which, at the time of
issuance or assumption by the Corporation, matured by their terms
on a date ten or more years subsequent to such issuance or
assumption to the extent that, as of any specified time of
computation, such unsecured debt securities do not mature by
their terms and are not required to be redeemed, reacquired or
otherwise retired, through sinking fund or other debt retirement
provision, on a date less than five years subsequent to such time
of computation; and
17
<PAGE> 18
(III) the "Capitalization of the Corporation" shall be
deemed to mean, as of any specified time of computation, an
amount equal to the sum of the total principal amount of all
bonds or other debt securities representing secured indebtedness
issued or assumed by the Corporation and then to be outstanding,
and the aggregate of the par value of, or stated capital
represented by, the outstanding shares of all classes of stock
and of the surplus of the Corporation, paid in, earned and other,
if any;"
REASONS FOR THE PROPOSED AMENDMENT
OPCo believes that regulatory, legislative, technological and market
developments are likely to lead to a more competitive environment in the
electric utility industry. OPCo and AEP's other electric utility subsidiaries
believe that they currently have a favorable competitive position because of
their relatively low costs. As competition intensifies, flexibility and cost
reduction will be even more crucial to success. Because the electric utility
industry is extremely capital intensive, control and minimization of financing
costs are of particular importance. In response to the competitive forces and
regulatory changes faced by OPCo and AEP's other electric utility subsidiaries,
AEP and its public utility subsidiaries have from time to time considered, and
expect to continue to consider, various strategies designed to enhance their
competitive position and to increase their ability to adapt to and anticipate
changes in their utility business.
OPCo believes that adoption of the Proposed Amendment is key to financial
flexibility and capital cost reduction. If adopted, the Debt Limitation
Provision will be eliminated. Historically, OPCo's debt financing generally has
been accomplished through the issuance of long-term first mortgage bonds, a
modest amount of unsecured short-term debt and long-term installment purchase
contracts for pollution control bonds. First mortgage bonds represent secured
indebtedness placing a first priority lien on substantially all of OPCo's
assets. OPCo's first mortgage bonds issued under its Mortgage and Deed of Trust
between OPCo and its bondholders contain certain restrictive covenants with
respect to, among other things, the disposition of assets and the ability to
issue additional first mortgage bonds. Unsecured debt generally has fewer
restrictions than first mortgage bonds. Short-term debt, a low cost form of debt
available to OPCo, represents one type of unsecured indebtedness. Pollution
control bond financing, a favorable type of financing due to its tax-exempt
status, is available only for very limited purposes.
The Proposed Amendment will not only allow OPCo to issue a greater amount
of unsecured debt, but also will allow OPCo to issue a greater amount of total
debt. OPCo, however, presently has no intention of issuing a greater amount of
total debt than it would have issued absent the adoption of the Proposed
Amendment, except that OPCo may issue additional unsecured debt to fund the
purchase of the Shares from AEP. Rather, it is OPCo's intention to attain
flexibility in the mix of its outstanding debt and therefore have the option to
use more short-term and other unsecured debt and less first mortgage bonds.
Inasmuch as the Debt Limitation Provision contained in the Articles limits
OPCo's flexibility in planning and financing its business activities, OPCo
believes it ultimately will be at a competitive disadvantage if the Debt
Limitation Provision is not eliminated. The industry's new competitors (for
example, power marketers, exempt wholesale generators, independent power
producers and cogeneration facilities) generally are not subject to the type of
financing restrictions the Articles impose on OPCo. Recently, several other
utilities with the same or similar charter restrictions have successfully
eliminated such provisions by soliciting their shareholders for the same or
similar amendments. In addition, some potential utility competitors, and other
AEP public utility subsidiaries, including Columbus Southern Power Company and
Kentucky Power Company, have no comparable provision restricting the issuance of
unsecured debt.
Although OPCo sells relatively low-cost power, OPCo must continue to
explore new ways of reducing costs and enhancing flexibility. OPCo believes that
the adoption of the Proposed Amendment will be in the best long-term competitive
interests of its shareholders.
Financial Flexibility. If the Proposed Amendment is adopted, OPCo will
have increased flexibility (i) to choose among different types of debt financing
and (ii) to finance projects using the most cost effective means. OPCo believes
that various types of unsecured debt alternatives will increase in importance as
an option in financing its construction program and refinancing first mortgage
bonds. The availability and
18
<PAGE> 19
flexibility of unsecured debt is necessary to take full advantage of changing
conditions in securities markets. As a result, OPCo may increase the amount of
unsecured debt to more than 20% of capitalization.
In addition, although OPCo's earnings currently are sufficient to meet the
earnings coverage tests that must be satisfied before issuing additional first
mortgage bonds and preferred stock, there is no guarantee that this will be true
in the future. Other utilities have been unable to issue first mortgage bonds
during certain periods because of restrictive covenants in their mortgages.
OPCo's inability to issue first mortgage bonds or preferred stock in the future,
combined with the inability to issue additional unsecured debt, would limit
OPCo's financing options to more costly options, including additional common
equity. Moreover, continued reliance on the issuance of first mortgage bonds
under OPCo's Mortgage and Deed of Trust could limit OPCo's ability in the future
to strategically redeploy its assets.
Under the Debt Limitation Provision, OPCo's use of unsecured short-term
debt is presently restricted. However, OPCo believes that the prudent use of
such debt in excess of this provision is vital to effective financial management
of its business. Not only is unsecured short-term debt generally one of the
least expensive forms of capital, it also provides flexibility in meeting
seasonal and business cycle fluctuations in cash requirements, acts as a bridge
between issues of permanent capital and can be used when unfavorable conditions
prevail in the market for long-term capital.
Lower Costs. As previously mentioned, OPCo's short-term debt issuances
generally represent one of its lowest-cost forms of financing. OPCo is
reassessing its historically modest use of short-term debt. By increasing its
use of short-term debt, OPCo may be able to lower its cost structure further,
thereby making its products more competitive and reducing its business risks.
However, with the Debt Limitation Provision in place, the availability and
corresponding benefits of short-term debt diminish. And although short-term debt
may expose the borrower to more volatility in interest rates, it should be noted
that the cost of short-term debt seldom exceeds the cost of other forms of
capital available at the same time.
IT IS FOR ALL THE ABOVE REASONS THAT OPCO'S BOARD BELIEVES THE BEST
LONG-TERM INTERESTS OF SHAREHOLDERS ARE SERVED BY, AND ENCOURAGES SHAREHOLDERS
TO VOTE FOR, THE ADOPTION OF THE PROPOSED AMENDMENT.
EXPLANATION OF THE SECOND PROPOSED AMENDMENT
ARTICLE FOURTH, Clause 3, concerning OPCo's authority to redeem the
cumulative preferred stock, expressly provides that the redemption provisions
thereof do not limit any right of OPCo to purchase or otherwise acquire shares
of the cumulative preferred stock, provided that OPCo shall not purchase or
otherwise acquire any shares of any series of cumulative preferred stock during
any period when OPCo is in default in the payment of dividends on any shares of
any series of the cumulative preferred stock, unless all shares of the
cumulative preferred stock then outstanding are concurrently redeemed, purchased
or otherwise acquired or unless such redemption purchase or acquisition shall
have been ordered, permitted or approved by the SEC.
The Second Proposed Amendment, if adopted, would add a paragraph to the end
of ARTICLE FOURTH, Clause 3, that would resolve any question concerning the
scope of the authority of the Board of Directors to purchase or otherwise
acquire shares of the cumulative preferred stock. The adoption of the Second
Proposed Amendment will not affect in any way the dividend, voting rights and
other rights of the shares of the cumulative preferred stock that are now issued
and outstanding. Unless otherwise defined, capitalized terms used in the
Paragraph are used as defined in the Articles.
If adopted, the Second Proposed Amendment would add the following paragraph
to the end of ARTICLE FOURTH, Clause 3:
The Corporation may from time to time, by action of its Board of Directors
and without action by the holders of the Common Stock or any class of the
Cumulative Preferred Stock, purchase or otherwise acquire shares of any class of
the Cumulative Preferred Stock in such manner, upon such terms and in such
amounts as the Board of Directors shall determine; subject, however, to such
limitations or restrictions, if any, as are contained in the express terms of
any class of the Cumulative Preferred Stock outstanding at the time of the
purchase or acquisition in question.
19
<PAGE> 20
REASONS FOR THE SECOND PROPOSED AMENDMENT
OPCO has proposed the Second Proposed Amendment because the Board of
Directors believes that to the extent possible (i) the scope of the authority of
the Board of Directors set forth in the Articles, including the authority of the
Board of Directors to purchase or otherwise acquire shares of any series of the
cumulative preferred stock, should be stated as clearly as possible and (ii) any
ambiguity in the Articles regarding such authority should be eliminated.
Under Ohio corporation law, which governs OPCo, a corporation by its
directors may purchase its stock only in limited circumstances, including (i)
when the articles of incorporation authorize the redemption of such shares and
do not prohibit such purchase and (ii) when the articles of incorporation
authorize such purchase. OPCo's Articles do not limit or prohibit OPCo's
purchase of its Preferred Shares, and the Articles currently authorize the
redemption of the 4 1/2% Series, the 4.08% Series, the 4.20% Series and the
4.40% Series, but not the 5.90% Series, the 6.02% Series and the 6.35% Series.
The Articles do not otherwise address the purchase of the Preferred Shares. As
such, although the Board of Directors believes that it has the authority to
repurchase such Preferred Shares, in light of the magnitude of the purchase
contemplated, the Board of Directors prefers to clearly establish that its
authority to purchase shares of cumulative preferred stock is circumscribed only
by the express terms of any class of the cumulative preferred stock set forth in
the Articles. The adoption of the Second Proposed Amendment would clarify the
scope of the Board of Directors' authority to purchase the shares of the
cumulative preferred stock.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
Upon recommendation of the Audit Committee of AEP's board of directors,
such board employed on January 31, 1996 Deloitte & Touche LLP as independent
public accountants for AEP and its subsidiaries, including OPCo, for the year
1996. A representative of Deloitte & Touche LLP will not be present at the
Special Meeting unless prior to the day of the Special Meeting the Secretary of
OPCo has received written notice from a Preferred Shareholder addressed to the
Secretary at 1 Riverside Plaza, Columbus, Ohio 43215, that such Preferred
Shareholder will attend the Special Meeting and wishes to ask questions of a
representative of Deloitte & Touche LLP.
PRICE RANGE OF SHARES; DIVIDENDS
OPCo's Cumulative Preferred Stock 4-1/2% Series, 4.08% Series, 4.20%
Series, 4.40% Series, 5.90% Series, 6.02% Series and 6.35% Series are traded in
the over-the-counter market under the symbols "OHIPM", "OHIPP", "OHIPO",
"OHIPN","OHIPI","OHPOP" and "OHIPH", respectively. The last reported sale price
in the over-the-counter market, as of the close of business on January 28, 1997,
for each of the Series of Preferred is shown on the front cover of this Offer to
Purchase and Proxy Statement. However, Preferred Shareholders should be aware
that there is no established trading market for the Shares and that the Shares
of each Series of Preferred only trade sporadically and on a limited basis and,
therefore, the last reported sales price may not necessarily reflect the market
value of the Shares.
PREFERRED SHAREHOLDERS ARE URGED TO OBTAIN CURRENT MARKET QUOTATIONS, IF
AVAILABLE, FOR THE SHARES.
The following table sets forth the high and low sales prices of each Series
of Preferred in the over-the-counter market as reported by the National
Quotation Bureau, Inc. and the cash dividends paid thereon for the fiscal
quarters indicated.
20
<PAGE> 21
DIVIDENDS AND PRICE RANGES OF CUMULATIVE PREFERRED STOCK
BY QUARTERS (1996 AND 1995)
<TABLE>
<CAPTION>
1996 - QUARTERS 1995 - QUARTERS
------------------------------------ ------------------------------------
1ST 2ND 3RD 4TH 1ST 2ND 3RD 4TH
------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CUMULATIVE PREFERRED STOCK ($100
Par Value)
4.08% Series
Dividends Paid Per Share......... $1.02 $1.02 $1.02 $1.02 $1.02 $1.02 $1.02 $1.02
Market Price -- $ Per Share
(OTC)
Ask -- High/Low................ -- -- -- -- -- -- -- --
Bid -- High.................... 50-1/4 50 50 50 45-1/4 47-1/2 47-3/4 49-3/4
-- Low...................... 49-3/4 50 49 49 43-1/2 44-1/2 45 46-3/8
4- 1/2% Series
Dividends Paid Per Share......... $1.125 $1.125 $1.125 $1.125 $1.125 $1.125 $1.125 $1.125
Market Price -- $ Per Share
(OTC)
Ask -- High.................... 62-1/2 59 59 -- -- -- -- --
-- Low...................... 62-1/2 58-1/2 59 -- -- -- -- --
Bid -- High.................... 61-5/8 58-3/4 57 57-1/2 53-1/4 54-1/2 56-1/2 59-3/8
-- Low...................... 56.5 57 57 57 48 50-1/2 53 53
4.20% Series
Dividends Paid Per Share......... $1.05 $1.05 $1.05 $1.05 $1.05 $1.05 $1.05 $1.05
Market Price -- $ Per Share
(OTC)
Ask -- High/Low................ -- -- -- -- -- -- -- --
Bid -- High.................... 55 55 52-3/8 52-5/8 47-3/4 50-1/2 51 53-1/4
-- Low...................... 52-5/8 52-3/8 52-3/8 52-3/8 45-1/4 47-1/4 47-1/4 49-5/8
4.40% Series
Dividends Paid Per Share......... $1.10 $1.10 $1.10 $1.10 $1.10 $1.10 $1.10 $1.10
Market Price -- $ Per Share
(OTC)
Ask -- High.................... 61-1/4 -- -- -- -- -- -- --
-- Low...................... 61 -- -- -- -- -- -- --
Bid -- High.................... 60-1/2 57 56 56-1/2 51-3/8 54-1/2 55-1/4 58-1/2
-- Low...................... 55-1/4 56 56 56 47-1/2 49-1/2 52-5/8 52-5/8
5.90% Series
Dividends Paid Per Share......... $1.475 $1.475 $1.475 $1.475 $1.475 $1.475 $1.475 $1.475
Market Price -- $ Per Share
(OTC) -- Quotations not
available
6.02% Series
Dividends Paid Per Share......... $1.505 $1.505 $1.505 $1.505 $1.505 $1.505 $1.505 $1.505
Market Price -- $ Per Share
(OTC) -- Quotations not
available
6.35% Series
Dividends Paid Per Share......... $1.5875 $1.5875 $1.5875 $1.5875 $1.5875 $1.5875 $1.5875 $1.5875
Market Price -- $ Per Share
(OTC) -- Quotations not
available
</TABLE>
- ---------------
OTC -- Over-the-Counter
Note -- The above bid and asked quotations represent prices between dealers and
do not represent actual transactions.
Market quotations provided by National Quotation Bureau, Inc.
Dash indicates quotes not available.
Dividends for a Series of Preferred are payable when, as and if declared by
OPCo's Board of Directors at the rate per annum included in such title of the
Series of Preferred listed on the front cover of this Offer to Purchase and
Proxy Statement. The March 1997 Dividend has been declared on each Series of
Preferred, payable March 1, 1997 to holders of record as of the close of
business on February 12, 1997. A tender and purchase of Shares pursuant to the
Offer will not deprive such Preferred Shareholder of his or her right to
21
<PAGE> 22
receive the March 1, 1997 Dividend on his or her Shares, regardless when such
tender is made. Tendering Preferred Shareholders will be entitled to any
dividends accrued prior to the Payment Date in respect of any later dividend
periods (or any portion thereof).
PURPOSE OF THE OFFER; CERTAIN EFFECTS OF THE OFFER
AEP believes that the purchase of the Shares at this time represents an
attractive economic opportunity that will benefit OPCo, and indirectly, AEP and
its shareholders. In addition, the Offer gives Preferred Shareholders the
opportunity to sell their Shares at a price which AEP believes to be a premium
to the market price on the date of the announcement of the Offer and without the
usual transaction costs associated with a sale.
After the consummation of the Offer, AEP or OPCo may purchase additional
Shares on the open market, in privately negotiated transactions, through one or
more tender offers or otherwise. Any such purchases may be on the same terms as,
or on terms which are more or less favorable to holders of Shares than, the
terms of the Offer. However, Rule 13e-4(f)(6) under the Exchange Act prohibits
AEP and its affiliates (including OPCo) from purchasing any Shares of a Series
of Preferred, other than pursuant to the Offer, until at least ten business days
after the Expiration Date with respect to that Series of Preferred. Any future
purchases of Shares by AEP or OPCo would depend on many factors, including the
market price of the Shares, AEP's business and financial position, legal
restrictions on AEP's ability to purchase Shares as well as general economic and
market conditions.
Preferred Shareholders are not under any obligation to tender Shares
pursuant to the Offer. The Offer does not constitute notice of redemption of any
Series of Preferred pursuant to OPCo's Articles, nor does AEP or OPCo intend to
effect any such redemption by making the Offer. Further, the Offer does not
constitute a waiver by OPCo of any option it has to redeem Shares. The 4- 1/2%
Series, 4.08% Series, 4.20% Series and 4.40% Series are not subject to mandatory
redemption, but presently are callable at $110.00 per Share, $103.00 per Share,
$103.20 per Share and $104.00 per Share, respectively. Commencing in 2004 and
continuing through the year 2008, a sinking fund for the 5.90% Series will
require the redemption of 22,500 Shares on January 1 of each year and the
redemption of the remaining Shares outstanding on January 1, 2009, in each case
at $100 per Share; commencing in 2003 and continuing through the year 2007, a
sinking fund for the 6.02% Series will require the redemption of 20,000 Shares
on December 1 of each year and the redemption of the remaining Shares
outstanding on December 1, 2008, in each case at $100 per Share; commencing in
2003 and continuing through the year 2007, a sinking fund for the 6.35% Series
will require the redemption of 15,000 Shares on June 1 of each year and the
redemption of the remaining Shares outstanding on June 1, 2008, in each case at
$100 per Share. The Shares of each Series of Preferred have no preemptive or
conversion rights.
Upon liquidation or dissolution of OPCo, owners of the Shares would be
entitled to receive an amount equal to the liquidation preference per share
($100 except in the case of the 4 1/2% Series which, under certain limited
circumstances, will be $110) plus all accrued and unpaid dividends (whether or
not earned or declared) thereon to the date of payment, prior to the payment of
any amounts to the holders of OPCo's common stock.
Shares validly tendered to the Depositary pursuant to the Offer and not
withdrawn in accordance with the procedures set forth herein shall be held until
the Expiration Date (or returned to the extent the Offer is terminated in
accordance herewith). To the extent that the Proposed Amendment is approved and
the Shares tendered are accepted for payment and paid for in accordance with the
terms hereof, AEP intends to sell its Shares to OPCo and, at that time, it is
expected that OPCo will retire and cancel the Shares. However, in the event the
Proposed Amendment is not adopted at the Special Meeting, AEP may elect, but is
not obligated to, waive, subject to applicable law, such condition. In that
case, subsequent to AEP's waiver and purchase of the Shares, OPCo anticipates,
as promptly as practicable thereafter, that it would call another special
meeting of its shareholders and solicit proxies therefrom for an amendment
substantially similar to the Proposed Amendment. At that meeting, AEP would vote
any Shares acquired by it pursuant to the Offer or otherwise (together with its
shares of common stock) in favor of such amendment, thereby maximizing the
prospects for the adoption of the amendment. Any such purchase of Shares by AEP
will reduce the number of Shares of
22
<PAGE> 23
each of the Series of Preferred that might otherwise trade publicly or become
available for purchase and/or sale and likely will reduce the number of owners
of Shares of each of the Series of Preferred, which could adversely affect the
liquidity and sale value of the Shares not purchased in the Offer.
Liquidity of Trading Market. To the extent that Shares of any Series of
Preferred are tendered and accepted for payment in the Offer, the trading market
for Shares of such Series of Preferred that remain outstanding may be
significantly more limited, which might adversely affect the liquidity, market
value and price volatility of such Shares. Equity securities with a smaller
outstanding market value available for trading (the "float") may command a lower
price than would comparable equity securities with a greater float. Therefore,
the market price for Shares that are not tendered in the Offer may be affected
adversely to the extent that the amount of Shares purchased pursuant to the
Offer reduces the float. The reduced float may also make the trading price of
the Shares that are not tendered and accepted for payment more volatile.
Preferred Shareholders of the remaining Shares may attempt to obtain quotations
for the Shares from their brokers; however, there can be no assurance that any
trading market will exist for such Shares following consummation of the Offer.
To the extent a market continues to exist for the Shares after the Offer, the
Shares may trade at a discount compared to present trading depending on the
market for Shares with similar features, the performance of OPCo, and other
factors. There is no assurance that an active market in the Shares will exist
and no assurance as to the prices at which the Shares may trade.
The 4-1/2% Series is currently registered under Section 12(g) of the
Exchange Act. Registration of the Shares of the 4- 1/2% Series under the
Exchange Act may be terminated upon the application by OPCo to the SEC if such
Shares are neither listed on a national securities exchange nor held by more
than 300 holders of record. Termination of registration of the Shares of the
4- 1/2% Series under the Exchange Act would substantially reduce the information
required to be furnished by OPCo to Preferred Shareholders and could make
certain provisions of the Exchange Act no longer applicable to OPCo.
The purchase of Shares of each Series of Preferred Stock pursuant to the
Offer will reduce the number of holders of Shares and the number of such Shares
that might otherwise trade publicly, and, depending upon the number of Shares so
purchased, such reduction could adversely affect the liquidity and market value
of the remaining Shares of each such Series of Preferred Stock held by the
public. The extent of the public market for such Shares and the availability of
price quotations would, however, depend upon such factors as the number of
stockholders remaining at such time, the interest in maintaining a market in the
Shares on the part of securities firms and other factors. As of December 31,
1996, there were 1,867 registered holders of the 4- 1/2% Series, 83 registered
holders of the 4.08% Series, 123 registered holders of the 4.20% Series, 178
registered holders of the 4.40% Series, 1 registered holder of the 5.90% Series,
1 registered holder of the 6.02% Series and 2 registered holders of the 6.35%
Series.
Other Potential Effects of the Proposed Amendment on Preferred Shareholders
who do not Tender. If the Proposed Amendment becomes effective, Preferred
Shareholders of Shares that are not tendered and purchased pursuant to the Offer
will no longer be entitled to the benefits of the Debt Limitation Provision,
which will have been deleted by the Proposed Amendment. As discussed above, the
Debt Limitation Provision places restrictions on OPCo's ability to issue or
assume unsecured indebtedness. Although OPCo's debt instruments may contain
certain restrictions on OPCo's ability to issue or assume debt, any such
restrictions may be waived and the increased flexibility afforded OPCo by the
deletion of the Debt Limitation Provision may permit OPCo to take certain
actions that may increase the credit risks with respect to OPCo, adversely
affecting the market price and credit rating of the remaining Shares or
otherwise be materially adverse to the interests of the remaining Preferred
Shareholders. In addition, to the extent that OPCo elects to fund its purchase
of the Shares by issuing additional unsecured debt, the remaining Preferred
Shareholders' relative position in OPCo's capital structure could be perceived
to decline, which in turn could adversely affect the market price and credit
rating of the remaining Shares. To this end, Moody's has advised OPCo that
Moody's might reconsider its rating of OPCo's preferred stock, absent some
mitigating factors, and particularly in light of OPCo's plan to fund the
purchase of Shares from AEP through the issuance of additional unsecured debt.
Following the consummation of the Offer, the business and operations of
OPCo will be continued substantially as they are currently being conducted.
Except as disclosed in this Offer to Purchase and Proxy Statement, AEP and OPCo
currently have no plans or proposals that relate to or would result in: (a) the
23
<PAGE> 24
acquisition by any person or entity of additional securities of OPCo or the
disposition of securities of OPCo, other than in the ordinary course of
business; (b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving OPCo or any of its subsidiaries other
than OPCo's continuing studies of its active coal subsidiaries which might
result in an extraordinary corporate transaction and OPCo's plan to merge
Central Coal Company, an inactive and immaterial coal subsidiary; (c) a sale or
transfer of a material amount of assets of OPCo or any of its subsidiaries; (d)
any change in the present Board or management of OPCo; (e) any material change
in the present dividend rate or policy, or indebtedness or capitalization of
OPCo; (f) any other material change in OPCo's corporate structure or business;
(g) any change in OPCo's Articles or Regulations or any actions that may impede
the acquisition of control of OPCo by any person; (h) a class of equity
securities of OPCo being delisted from a national securities exchange or no
longer authorized to be quoted on the OTC; (i) a class of equity securities of
OPCo becoming eligible for termination of registration pursuant to Section
12(g)(4) of the Exchange Act; or (j) the suspension of OPCo's obligation to file
reports pursuant to Section 15(d) of the Exchange Act.
NEITHER AEP, OPCO, THEIR RESPECTIVE BOARDS OF DIRECTORS, NOR ANY OF THEIR
RESPECTIVE OFFICERS MAKES ANY RECOMMENDATION TO ANY PREFERRED SHAREHOLDER AS TO
WHETHER TO TENDER ALL OR ANY SHARES. EACH PREFERRED SHAREHOLDER MUST MAKE HIS OR
HER OWN DECISION AS TO WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO
TENDER.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
In the opinion of Simpson Thacher & Bartlett, tax counsel to AEP and OPCo,
the following summary describes the principal United States federal income tax
consequences of sales of Shares pursuant to the Offer and the receipt of Special
Cash Payments in connection with the approval and adoption of the Proposed
Amendment. This summary is based on the Internal Revenue Code of 1986, as
amended to the date hereof (the "Code"), administrative pronouncements, judicial
decisions and existing and proposed Treasury Regulations, changes to any of
which subsequent to the date of this Offer to Purchase and Proxy Statement may
adversely affect the tax consequences described herein, possibly on a
retroactive basis. This summary is addressed to Preferred Shareholders who hold
Shares as capital assets within the meaning of Section 1221 of the Code. This
summary does not discuss all of the tax consequences that may be relevant to a
Preferred Shareholder in light of such Preferred Shareholder's particular
circumstances or to Preferred Shareholders subject to special rules (including
certain financial institutions, tax-exempt organizations, insurance companies,
dealers in securities or currencies, foreign persons or entities selling Shares
pursuant to the Offer who own or have owned, actually or constructively, more
than five percent of such Shares, Preferred Shareholders who acquired their
Shares pursuant to the exercise of stock options or other compensation
arrangements with OPCo or Preferred Shareholders holding the Shares as part of a
conversion transaction, as part of a hedge or hedging transaction, or as a
position in a straddle for tax purposes). Preferred Shareholders should consult
their tax advisors with regard to the application of the United States federal
income tax laws to their particular situations as well as any tax consequences
arising under the laws of any state, local or foreign taxing jurisdiction.
As used herein, the term "United States Holder" means an owner of a Share
that is (i) for United States federal income tax purposes a citizen or resident
of the United States; (ii) a corporation, partnership or other entity created or
organized in or under the laws of the United States or of any political
subdivision thereof; (iii) an estate, or for taxable years beginning on or
before December 31, 1996, in general, any trust, the income of which is subject
to United States federal income taxation regardless of its source; or (iv) for
taxable years beginning after December 31, 1996, any trust if a court within the
United States is able to exercise primary supervision over the administration of
such trust and one or more United States fiduciaries have the authority to
control all substantial decisions of such trust. A "Non-United States Holder" is
a Preferred Shareholder that is not a United States Holder.
Tax Considerations for Tendering Preferred Shareholders
Characterization of the Sale. A sale of Shares by a Preferred Shareholder
pursuant to the Offer will be a taxable transaction for Federal income tax
purposes.
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<PAGE> 25
United States Holders. A United States Holder will recognize gain or loss
equal to the difference between the tax basis of such Holder's Shares and the
amount of cash received in exchange therefor. A United States Holder's gain or
loss will be long-term capital gain or loss if the holding period for the Shares
is more than one year as of the date of the sale of such Shares. The excess of
net long-term capital gains over net short-term capital losses is taxed at a
lower rate than ordinary income for certain non-corporate taxpayers. The
distinction between capital gain or loss and ordinary income or loss is also
relevant for purposes of, among other things, limitations on the deductibility
of capital losses.
Non-United States Holders. Any gain realized upon the sale of Shares by a
Non-United States Holder pursuant to the Offer generally will not be subject to
United States Federal income tax unless (i) such gain is effectively connected
with a trade or business in the United States of the Non-United States Holder,
or (ii) in the case of a Non-United States Holder who is an individual, such
individual is present in the United States for 183 days or more in the taxable
year of such sale and certain other conditions are met.
A Non-United States Holder described in clause (i) above will be taxed on
the net gain derived from the sale at regular graduated United States Federal
income tax rates. If a Non-United States Holder that is a foreign corporation
falls under clause (i) above, it may also be subject to an additional "branch
profits tax" at a 30% rate (or such lower rate as may be specified by an
applicable income tax treaty). Unless an applicable tax treaty provides
otherwise, an individual Non-United States Holder described in clause (ii) above
will be subject to a flat 30% tax on the gain derived from the sale, which may
be offset by United States capital losses (notwithstanding the fact that the
individual is not considered a resident of the United States).
Tax Considerations for Non-Tendering Preferred Shareholders
Preferred Shareholders, whether or not they receive Special Cash Payments,
will not recognize any taxable gain or loss with respect to the Shares as a
result of the modification of the Articles by the Proposed Amendment.
United States Holders. There is no direct authority concerning the Federal
income tax consequences of the receipt of Special Cash Payments. OPCo will, for
information reporting purposes, treat Special Cash Payments as ordinary
non-dividend income to recipient United States Holders.
Non-United States Holders. OPCo will treat Special Cash Payments paid to a
Non-United States Holder of Shares as subject to withholding of United States
Federal income tax at a 30% rate. However, Special Cash Payments that are
effectively connected with the conduct of a trade or business by the Non-United
States Holder within the United States are not subject to the withholding tax
(provided such Non-United States Holder provides two originals of Internal
Revenue Service ("IRS") Form 4224 stating that such Special Cash Payments are so
effectively connected), but instead are subject to United States Federal income
tax on a net income basis at applicable graduated individual or corporate rates.
Any such effectively connected Special Cash Payments received by a foreign
corporation may, under certain circumstances, be subject to an additional
"branch profits tax" at a 30% rate (or such lower rate as may be specified by an
applicable income tax treaty).
A Non-United States Holder of Shares eligible for a reduced rate of United
States withholding tax pursuant to an income tax treaty may obtain a refund of
any excess amounts withheld by filing an appropriate claim for refund with the
IRS.
Backup Withholding. ANY TENDERING PREFERRED SHAREHOLDER WHO FAILS TO
COMPLETE AND SIGN THE SUBSTITUTE FORM W-9 THAT IS INCLUDED IN THE APPLICABLE
LETTER OF TRANSMITTAL (OR, IN THE CASE OF A FOREIGN PREFERRED SHAREHOLDER, FORM
W-8 OBTAINABLE FROM THE DEPOSITARY) MAY BE SUBJECT TO A REQUIRED FEDERAL INCOME
TAX BACKUP WITHHOLDING OF 31% OF THE GROSS PROCEEDS PAYABLE TO SUCH PREFERRED
SHAREHOLDER PURSUANT TO THE OFFER. To prevent backup United States Federal
income tax withholding with respect to the purchase price of Shares purchased
pursuant to the Offer, a United States Holder must provide the Depositary with
the Preferred Shareholder's correct taxpayer identification number and certify
that the Preferred Shareholder is not subject to backup withholding of Federal
income tax by completing the Substitute Form W-9 included in the
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<PAGE> 26
applicable Letter of Transmittal. Certain Preferred Shareholders (including,
among others, all corporations and certain foreign shareholders) are exempt from
backup withholding. For a corporate United States Holder to qualify for such
exemption, such Preferred Shareholder must provide the Depositary with a
properly completed and executed Substitute Form W-9 attesting to its exempt
status. In order for a foreign Preferred Shareholder to qualify as an exempt
recipient, the foreign holder must submit a Form W-8, Certificate of Foreign
Status, signed under penalties of perjury, attesting to that Preferred
Shareholder's exempt status. A copy of Form W-8 may be obtained from the
Depositary.
Unless a Preferred Shareholder provides the appropriate certification,
under the applicable law and regulations concerning "backup withholding" of
Federal United States income tax, the Depositary will be required to withhold,
and will withhold, 31% of the gross proceeds otherwise payable to such Preferred
Shareholder or other payee. The amount of any backup withholding from a payment
to a Preferred Shareholder will be allowed as a credit against such Preferred
Shareholder's United States federal income tax liability and may entitle such
Preferred Shareholder to a refund, provided that the required information is
furnished to the IRS.
SOURCE AND AMOUNT OF FUNDS
Assuming that AEP purchases all outstanding Shares pursuant to the Offer,
the total amount required by AEP to purchase such Shares will be approximately
$151 million, exclusive of the accrued and unpaid dividends payments, but
including fees and other expenses. AEP intends to fund the Offer through the use
of its general funds (which, in the ordinary course, include funds from OPCo)
and funds borrowed pursuant to AEP's commercial paper program and committed
lines of credit, including any bank revolving credit agreements.
AEP and OPCo sell commercial paper directly to commercial paper dealers who
reoffer the commercial paper to investors and issue and sell short-term notes to
several domestic and foreign banks through various credit arrangements,
including revolving credit agreements or shared lines of credit. AEP and its
significant subsidiaries, including OPCo, have $500 million of committed lines
of credit available for use by AEP and such subsidiaries. If necessary, AEP and
its significant subsidiaries may negotiate increases to existing credit
arrangements in order to fund the Offer.
TRANSACTIONS AND AGREEMENTS CONCERNING THE SHARES
Each of AEP and OPCo has been advised by its directors and executive
officers that no directors or executive officers of the respective companies own
any Shares. Based upon the companies' records and upon information provided to
each company by its directors and executive officers, neither company nor, to
the knowledge of either, any of their subsidiaries, affiliates, directors or
executive officers, or associates of the foregoing, has engaged in any
transactions involving Shares during the 40 business days preceding the date
hereof. Neither company nor, to the knowledge of either, any of its directors or
executive officers or an associate of the foregoing is a party to any contract,
arrangement, understanding or relationship relating directly or indirectly to
the Offer with any other person or entity with respect to any securities of
OPCo.
FEES AND EXPENSES PAID TO DEALERS
Dealer Manager Fees. Merrill Lynch and Salomon Brothers will act as Dealer
Managers for AEP in connection with the Offer. AEP has agreed to pay the Dealer
Managers a fee of $.50 per Share for any Shares tendered, accepted for payment
and paid for pursuant to the Offer and a fee of $.50 per Share for any Shares
that are not tendered pursuant to the Offer but which vote in favor of the
Proposed Amendment. The Dealer Managers will also be reimbursed by AEP for their
reasonable out-of-pocket expenses, including attorneys' fees, and will be
indemnified against certain liabilities, including certain liabilities under the
federal securities laws, in connection with the Offer. The Dealer Managers have
rendered, are currently rendering and are expected to continue to render various
investment banking and other advisory services to AEP and OPCo. The Dealer
Managers have received, and will continue to receive, customary compensation
from AEP and OPCo for such services. AEP has retained First Chicago Trust
Company of New York as Depositary and Morrow &
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<PAGE> 27
Co., Inc. as Information Agent in connection with the Offer. The Depositary and
Information Agent will receive reasonable and customary compensation for their
services and will also be reimbursed for reasonable out-of-pocket expenses,
including attorney fees. AEP has agreed to indemnify the Depositary and
Information Agent against certain liabilities, including certain liabilities
under the federal securities law, in connection with the Offer. Neither the
Depositary nor the Information Agent has been retained to make solicitations or
recommendations in connection with the Offer.
Solicited Tender Fees Separate Fees. Pursuant to Instruction 10 of the
accompanying Letter of Transmittal, AEP will pay to each designated Soliciting
Dealer a solicitation fee of $1.50 per Share for Shares of the 4 1/2% Series,
the 4.08% Series, the 4.20% Series and the 4.40% Series that are tendered,
accepted for payment and paid for pursuant to the Offer (except that for
transactions for beneficial owners equal to or exceeding 5,000 Shares, AEP will
pay a solicitation fee of $1.00 per Share for Shares of the 4- 1/2% Series, the
4.08% Series, the 4.20% Series and the 4.40% Series). AEP will pay a
solicitation fee of $0.50 per Share for Shares of the 5.90% Series, the 6.02%
Series and the 6.35% Series that are tendered, accepted for payment and paid for
pursuant to the Offer; provided, however, that any fee payable pursuant to this
sentence shall be paid 80% to the Dealer Managers and 20% to any designated
Soliciting Dealer (which may be a Dealer Manager). OPCo will pay a separate fee
of $.50 per Share for any Shares of the 4- 1/2% Series, the 4.08 Series, the
4.20% Series and the 4.40% Series that are not tendered pursuant to the Offer
but which are voted in favor of the Proposed Amendment. A designated Soliciting
Dealer is an entity obtaining the tender or proxy, if the Letter of Transmittal
or proxy, as the case may be, shall include its name and it is (a) any broker or
dealer in securities, including a Dealer Manager in its capacity as a dealer or
broker, which is a member of any national securities exchange or of the NASD,
(b) any foreign broker or dealer not eligible for membership in the NASD which
agrees to conform to the NASD's Rules of Fair Practice in soliciting tenders
outside the United States to the same extent as though it were an NASD member,
or (c) any bank or trust company.
No solicitation fee or separate fee (other than solicitation fees payable
to the Dealer Managers as provided above) shall be payable to a Soliciting
Dealer with respect to the tender of Shares or the vote of Shares by a holder
unless the Letter of Transmittal or proxy accompanying such tender or vote, as
the case may be, designates such Soliciting Dealer. No solicitation fee or
separate fee shall be payable to a Soliciting Dealer in respect of Shares
registered in the name of such Soliciting Dealer unless such Shares are held by
such Soliciting Dealer as nominee and such Shares are being tendered or voted
for the benefit of one or more beneficial owners identified on the Letter of
Transmittal or on the Notice of Solicited Tenders. No solicitation fee or
separate fee shall be payable to a Soliciting Dealer if such Soliciting Dealer
is required for any reason to transfer the amount of such fee to a depositing
holder (other than itself). No solicitation fee shall be paid to a Soliciting
Dealer with respect to Shares tendered for such Soliciting Dealer's own account
and no separate fee shall be paid to a Soliciting Dealer with respect to Shares
voted for such Soliciting Dealer's own account. A Soliciting Dealer shall not be
entitled to a solicitation fee or a separate fee for Shares beneficially owned
by such Soliciting Dealer. No broker, dealer, bank, trust company or fiduciary
shall be deemed to be the agent of AEP, OPCo, the Depositary, the Dealer
Managers or the Information Agent for purposes of the Offer.
Soliciting Dealers will include any of the organizations described in
clauses (a), (b) and (c) above even when the activities of such organizations in
connection with the Offer consist solely of forwarding to clients materials
relating to the Offer, including the Letter of Transmittal and tendering Shares
as directed by beneficial owners thereof. No Soliciting Dealer is required to
make any recommendation to holders of Shares as to whether to tender or refrain
from tendering in the Offer. No assumption is made, in making payment to any
Soliciting Dealer, that its activities in connection with the Offer included any
activities other than those described above, and for all purposes noted in all
materials relating to the Offer, the term "solicit" shall be deemed to mean no
more than "processing shares tendered" or "forwarding to customers materials
regarding the Offer."
Stock Transfer Taxes. AEP will pay all stock transfer taxes, if any,
payable on account of the acquisition of Shares by AEP pursuant to the Offer,
except in certain circumstances where special payment or delivery procedures are
utilized pursuant to Instruction 6 of the accompanying Letter of Transmittal.
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<PAGE> 28
CERTAIN INFORMATION REGARDING AEP AND OPCO
OPCo is an operating utility primarily engaged in the generation,
transmission and distribution of electric power to approximately 668,000
customers in Ohio, and in supplying electric power at wholesale to other
electric utility companies and municipalities. All of the common stock of OPCo
is owned, directly or indirectly, by AEP, a registered holding company under the
Holding Company Act. The service area of AEP's electric utility subsidiaries
covers portions of Indiana, Kentucky, Michigan, Ohio, Tennessee, Virginia and
West Virginia.
AEP and OPCo are subject to the informational requirements of the Exchange
Act and in accordance therewith file reports and other information with the SEC.
Such reports and other information may be inspected and copied at the public
reference facilities maintained by the SEC at 450 Fifth Street, N.W.,
Washington, D.C. 20549; 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511; and Seven World Trade Center, Suite 1300, New York, New York 10048.
Copies of such material can be obtained from the Public Reference Section of the
SEC, 450 Fifth Street, N.W., Washington D.C. 20549 at prescribed rates. The SEC
maintains a Web site at http://www.sec.gov containing reports, proxy and
information statements and other information regarding registrants that file
electronically with the SEC, including AEP and OPCo. Reports, proxy materials
and other information about AEP are also available at the offices of the New
York Stock Exchange, 20 Broad Street, New York, New York 10005. In connection
with the Offer AEP has filed an Issuer Tender Offer Statement on Schedule 13E-4
with the SEC that includes certain additional information relating to the Offer.
AEP's Schedule 13E-4 will not be available at the SEC's regional offices.
SUMMARY OF CONSOLIDATED FINANCIAL INFORMATION
Set forth below is certain consolidated historical financial information of
OPCo and its subsidiaries. The historical financial information (other than the
ratios of earnings to fixed charges) was derived from the audited consolidated
financial statements included in OPCo's Annual Report on Form 10-K for the year
ended December 31, 1995 and from the unaudited consolidated financial statements
included in OPCo's Quarterly Reports on Form 10-Q for the periods ended
September 30, 1996 and September 30, 1995.
CONDENSED INCOME STATEMENT DATA:
<TABLE>
<CAPTION>
(UNAUDITED)
NINE MONTHS ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30,
----------------------- -----------------------
1995 1994 1996 1995
--------- --------- --------- ---------
(THOUSANDS, EXCEPT RATIOS)
<S> <C> <C> <C> <C>
Operating Revenues...................... $1,822,997 $1,738,726 $1,438,081 $1,360,319
Operating Income........................ 272,160 244,873 224,379 203,477
Allowance for Borrowed and Equity Funds
Used During Construction.............. 1,265 3,944 1,121 1,273
Net Income.............................. 189,447 162,626 165,405 142,348
Preferred Stock Dividend Requirements... 14,668 15,301 6,681 11,578
Earnings Applicable to Common Stock..... 174,779 147,325 158,724 130,770
Ratio of Earnings to Fixed Charges...... 2.95 3.28 3.30(a) 2.92(a)
</TABLE>
- ---------------
(a) Ratio for the twelve months ended September 30.
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<PAGE> 29
CONDENSED BALANCE SHEET DATA (AT END OF PERIOD):
<TABLE>
<CAPTION>
(UNAUDITED)
DECEMBER 31, SEPTEMBER 30,
----------------------- -------------------------
1995 1994 1996 1995
--------- --------- --------- ---------
(THOUSANDS)
<S> <C> <C> <C> <C>
ASSETS:
Net Utility Plant In Service.......... $2,764,796 $2,810,606 $2,702,574 $2,778,638
Construction Work In Progress......... 59,278 49,889 71,981 65,077
Cash and Cash Equivalents............. 44,000 30,700 72,967 18,651
Other Current Assets.................. 489,099 445,202 487,636 475,959
Other Assets.......................... 799,391 814,743 721,550 761,774
--------- --------- --------- ---------
$4,156,564 $4,151,140 $4,056,708 $4,100,099
========= ========= ========= =========
LIABILITIES:
Common Equity......................... $1,298,704 $1,267,523 $1,351,369 $1,291,968
Cumulative Preferred Stock............ 156,240 241,240 153,532 241,240
Long-term Debt (less amounts due
within one year).................... 1,138,425 1,188,319 1,002,495 1,089,278
Current Liabilities................... 489,103 425,222 462,568 416,037(a)
Other Liabilities..................... 1,074,092 1,028,836 1,086,744 1,061,576(a)
--------- --------- --------- ---------
$4,156,564 $4,151,140 $4,056,708 $4,100,099
========= ========= ========= =========
</TABLE>
- ---------------
(a) Certain amounts reclassified to conform with current-period presentation.
The financial statements of AEP and OPCo and related information included
in their Annual Reports on Form 10-K for the year ended December 31, 1995 and
their Quarterly Reports on Form 10-Q for the periods ended March 31, June 30,
and September 30, 1996 and their Current Reports on Form 8-K, each dated
December 23, 1996, each as filed with the SEC, are hereby incorporated by
reference. All documents subsequently filed by AEP and OPCo pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Offer to
Purchase and Proxy Statement and prior to the Expiration Date (or any extension
thereof) shall be deemed to be incorporated by reference in this Offer to
Purchase and Proxy Statement and to be a part hereof from the date of filing of
such documents. Any statement contained in a document incorporated or deemed to
be incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Offer to Purchase and Proxy Statement to the extent that a
statement contained herein or in any other subsequently filed documents which is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Offer to
Purchase and Proxy Statement.
AEP and OPCo will provide without charge to each person to whom a copy of
this Offer to Purchase and Proxy Statement has been delivered, on the written or
oral request of any such person, a copy of any or all of the documents described
above which have been incorporated by reference in this Offer to Purchase and
Proxy Statement, other than exhibits to such documents. Written requests for
copies of such documents should be addressed to Mr. G. C. Dean, American
Electric Power Service Corporation, 1 Riverside Plaza, Columbus, Ohio 43215
(telephone 614-223-1000). The information relating to AEP and OPCo contained in
this Offer to Purchase and Proxy Statement does not purport to be comprehensive
and should be read together with the information contained in the documents
incorporated by reference.
29
<PAGE> 30
MISCELLANEOUS
The Offer is not being made to, nor will AEP accept tenders from, owners of
Shares in any jurisdiction in which the Offer or its acceptance would not be in
compliance with the laws of such jurisdiction. AEP is not aware of any
jurisdiction where the making of the Offer or the tender of Shares would not be
in compliance with applicable law. If AEP becomes aware of any jurisdiction
where the making of the Offer or the tender of Shares is not in compliance with
any applicable law, AEP will make a good faith effort to comply with such law.
If, after such good faith effort, AEP cannot comply with such law, the Offer
will not be made to (nor will tenders be accepted from or on behalf of) the
owners of Shares residing in such jurisdiction. In any jurisdiction in which the
securities, blue sky or other laws require the Offer to be made by a licensed
broker or dealer, the Offer will be deemed to be made on AEP's behalf by one or
more registered brokers or dealers licensed under the laws of such jurisdiction.
AMERICAN ELECTRIC POWER COMPANY, INC.
OHIO POWER COMPANY
30
<PAGE> 31
Facsimile copies of the Letter of Transmittal will not be accepted. The
Letter of Transmittal and, if applicable, certificates for Shares should be sent
or delivered by each tendering or voting Preferred Shareholder of OPCo or his or
her broker, dealer, bank or trust company to the Depositary at one of its
addresses set forth below.
THE DEPOSITARY IS:
FIRST CHICAGO TRUST COMPANY OF NEW YORK
<TABLE>
<S> <C> <C>
By Mail: By Hand: By Overnight Courier:
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
P.O. Box 2569 c/o The Depositary Trust Company 14 Wall Street, 8th Floor
Suite 4660 55 Water Street, DTC TAD Suite 4680
Jersey City, New Jersey 07303-2569 Vietnam Veterans Memorial Plaza New York, New York 10005
New York, New York 10041
</TABLE>
Any questions or requests for assistance may be directed to the Information
Agent or the Dealer Managers at their respective telephone numbers and addresses
listed below. Requests for additional copies of this Offer to Purchase and Proxy
Statement, the Letter of Transmittal or other tender offer or proxy materials
may be directed to the Information Agent, and such copies will be furnished
promptly at the companies' expense. Preferred Shareholders may also contact
their local broker, dealer, commercial bank or trust company for assistance
concerning the Offer.
THE INFORMATION AGENT:
MORROW & CO., INC.
909 Third Avenue
New York, New York 10022-4799
(800) 566-9061 (toll free)
or
(212) 754-8000
THE DEALER MANAGERS:
<TABLE>
<S> <C>
MERRILL LYNCH & CO. SALOMON BROTHERS INC
World Financial Center Seven World Trade Center
250 Versey Street New York, New York 10048
New York, New York 10281 Attn: Liability Management Department
1-888-ML4-TNDR (toll free) 800-558-3745 (toll free)
(1-888-654-8637 (toll free))
</TABLE>
31
<PAGE> 1
4-1/2% OPCO
LETTER OF TRANSMITTAL
TO ACCOMPANY
SHARES OF 4-1/2% SERIES CUMULATIVE PREFERRED STOCK
CUSIP NUMBER 677415 40 8
OF
OHIO POWER COMPANY
TENDERED PURSUANT TO THE OFFER TO PURCHASE FOR CASH
BY
AMERICAN ELECTRIC POWER COMPANY, INC.
DATED JANUARY 30, 1997, FOR PURCHASE AT A
PURCHASE PRICE OF $69.02 PER SHARE
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON FRIDAY, FEBRUARY 28, 1997, UNLESS THE OFFER IS EXTENDED.
TO: FIRST CHICAGO TRUST COMPANY OF NEW YORK, DEPOSITARY
<TABLE>
<S> <C> <C>
BY MAIL: BY HAND: BY OVERNIGHT COURIER:
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
P.O. Box 2569 c/o The Depository Trust Company 14 Wall Street, 8th
Suite 4660 55 Water Street, DTC TAD Floor
Jersey City, NJ 07303-2569 Vietnam Veterans Memorial Plaza Suite 4680-OPCO
New York, NY 10041 New York, NY 10005
</TABLE>
AMERICAN ELECTRIC POWER COMPANY, INC. ("AEP") WILL NOT BE REQUIRED TO
ACCEPT FOR PAYMENT OR PAY FOR ANY SHARES TENDERED IF THE PROPOSED AMENDMENT IS
NOT APPROVED AND ADOPTED AT THE SPECIAL MEETING. PREFERRED SHAREHOLDERS OF
RECORD OF OHIO POWER COMPANY ("OPCO") HAVE THE RIGHT TO VOTE FOR OR AGAINST THE
PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES BY CASTING
THEIR VOTE AND SIGNING THE PROXY ENCLOSED HEREWITH OR BY VOTING IN PERSON AT THE
SPECIAL MEETING. IF THE PROPOSED AMENDMENT IS APPROVED AND ADOPTED BY OPCO'S
SHAREHOLDERS, OPCO WILL MAKE A SPECIAL CASH PAYMENT TO EACH PREFERRED
SHAREHOLDER WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT THEIR
SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
- --------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDERS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NOTE: IF SHARES ARE BEING TENDERED, THE REMAINDER OF THIS LETTER OF TRANSMITTAL
MUST BE COMPLETED, INCLUDING, IF APPLICABLE, THE SUBSTITUTE FORM W-9
BELOW.
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS LETTER OF
TRANSMITTAL IN THE APPROPRIATE SPACE THEREFOR PROVIDED AND, IF YOU ARE TENDERING
ANY SHARES, COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW OR A FORM W-8, AS
APPLICABLE. SEE INSTRUCTION 8 AND "IMPORTANT TAX INFORMATION" BELOW.
DO NOT SEND ANY CERTIFICATES TO MERRILL LYNCH & CO., SALOMON BROTHERS INC,
MORROW & CO., INC., AMERICAN ELECTRIC POWER COMPANY, INC. OR OHIO POWER COMPANY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED. QUESTIONS REGARDING
AND REQUESTS FOR COPIES OF THE OFFER TO PURCHASE AND PROXY STATEMENT OR THIS
LETTER OF TRANSMITTAL MAY BE DIRECTED TO MORROW & CO., INC., THE INFORMATION
AGENT, AT 909 THIRD AVENUE, NEW YORK, NEW YORK 10022-4799 OR TELEPHONE (800)
566-9061 (TOLL FREE).
<PAGE> 2
This Letter of Transmittal is to be used (a) if certificates are to be
forwarded to the First Chicago Trust Company of New York ("Depositary") or (b)
if delivery of tendered Shares (as defined below) is to be made by book-entry
transfer to the Depositary's account at The Depository Trust Company ("DTC") or
the Philadelphia Depository Trust Company ("PDTC") (hereinafter collectively
referred to as the "Book-Entry Transfer Facilities") pursuant to the procedures
set forth under the heading "Terms of the Offer -- Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement (as defined below).
Preferred Shareholders (as defined below) who wish to tender Shares but who
cannot deliver their Shares and all other documents required hereby to the
Depositary by the Expiration Date (as defined in the Offer to Purchase and Proxy
Statement) must tender their Shares pursuant to the guaranteed delivery
procedure set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. See Instruction
2. DELIVERY OF DOCUMENTS TO AEP, OPCO OR A BOOK-ENTRY TRANSFER FACILITY DOES NOT
CONSTITUTE A VALID DELIVERY.
- --------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
(IF TENDERING SHARES, PLEASE FILL IN EXACTLY AS INFORMATION APPEARS ON
CERTIFICATE(S))
(ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------
TOTAL NUMBER OF SHARES
CERTIFICATE NUMBER(S)* REPRESENTED BY CERTIFICATE(S) NUMBER OF SHARES TENDERED**
- ------------------------------------------------------------------------------------------
<S> <C> <C>
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented by
any certificates delivered to the Depositary are being tendered. See
Instruction 4.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Depositary at 1-800-649-2153. In addition, you should
advise the Depositary of any certificate(s) you have in your possession. You
will need to complete an Affidavit of Loss with respect to the lost
certificate(s) (which will be provided by the Depositary) and pay an indemnity
bond premium fee.
(BOXES BELOW FOR USE BY ELIGIBLE INSTITUTIONS ONLY)
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
TO THE DEPOSITARY'S ACCOUNT AT A BOOK-ENTRY TRANSFER FACILITY AND
COMPLETE THE FOLLOWING:
Name of tendering institution
Account No.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE
OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE
THE FOLLOWING:
Name(s) of tendering shareholder(s)
Date of execution of Notice of Guaranteed Delivery
Name of institution that guaranteed delivery
If delivery is by book-entry transfer:
Name of tendering institution
Account no.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
<PAGE> 3
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to American Electric Power Company, Inc., a
New York corporation ("AEP"), the shares in the amount set forth in the box
above designated "Description of Shares Tendered" pursuant to AEP's offer to
purchase any and all of the outstanding shares of the series of cumulative
preferred stock of Ohio Power Company, an Ohio corporation, and direct utility
subsidiary of AEP ("OPCo"), shown on the first page hereof as to which this
Letter of Transmittal is applicable (the "Shares") at the purchase price per
Share shown on the first page hereof plus accrued and unpaid dividends thereon,
net to the seller in cash, upon the terms and subject to the conditions set
forth in the Offer to Purchase and Proxy Statement, dated January 30, 1997 (the
"Offer to Purchase and Proxy Statement"), receipt of which is hereby
acknowledged, and in this Letter of Transmittal (which as to the Shares,
together with the Offer to Purchase and Proxy Statement, constitutes the
"Offer"). WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT
TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S AMENDED
ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND PROXY
STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE PROPOSED
AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED IN THE
OFFER TO PURCHASE AND PROXY STATEMENT). See "Proposed Amendment and Proxy
Solicitation", "Terms of the Offer -- Extension of Tender Period; Termination;
Amendments" and "Terms of the Offer -- Certain Conditions of the Offer" in the
Offer to Purchase and Proxy Statement.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the undersigned hereby
sells, assigns and transfers to, or upon the order of, AEP all right, title and
interest in and to all the Shares that are being tendered hereby and hereby
constitutes and appoints First Chicago Trust Company of New York (the
"Depositary") the true and lawful agent and attorney-in-fact of the undersigned
with respect to such Shares, with full power of substitution (such power of
attorney being an irrevocable power coupled with an interest), to (a) deliver
certificates for such Shares, or transfer ownership of such Shares on the
account books maintained by the Book-Entry Transfer Facility that holds such
Shares, together, in any such case, with all accompanying evidences of transfer
and authenticity, to or upon the order of AEP, (b) present such Shares for
registration and transfer on the books of OPCo and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, all in
accordance with the terms of the Offer. The Depositary will act as agent for
tendering stockholders for the purpose of receiving payment from AEP and
transmitting payment to tendering stockholders.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Shares
tendered hereby and that, when and to the extent the same are accepted for
payment by AEP, AEP will acquire good, marketable and unencumbered title
thereto, free and clear of all liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the same will not be subject to any adverse claims. The
undersigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or AEP to be necessary or desirable to complete the
sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by, and shall survive the death, bankruptcy or incapacity of the
undersigned, and any obligations of the undersigned hereunder shall be binding
upon the heirs, legal representatives, successors, assigns, executors and
administrators of the undersigned. Except as stated in the Offer, this tender is
irrevocable.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and in the
instructions hereto will constitute the undersigned's acceptance of the terms
and conditions of the Offer, including the undersigned's representation and
warranty that (a) the undersigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (b) the tender of such Shares complies
with such Rule 14e-4. AEP's acceptance for payment of Shares tendered pursuant
to the Offer will constitute a binding agreement between the undersigned and AEP
upon the terms and subject to the conditions of the Offer.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase and Proxy Statement, AEP may terminate or amend the Offer
or may not be required to purchase any of the Shares tendered hereby. In either
event, the undersigned understands that certificate(s) for any Shares not
tendered or not purchased will be returned to the undersigned.
<PAGE> 4
Unless otherwise indicated in the box below under the heading "Special
Payment Instructions", please issue the check for the purchase price of any
Shares purchased, and/or return any Shares not tendered or not purchased, in the
name(s) of the undersigned (and, in the case of Shares tendered by book-entry
transfer, by credit to the account at the Book-Entry Transfer Facility
designated above). Similarly, unless otherwise indicated in the box below under
the heading "Special Delivery Instructions", please mail the check for the
purchase price of any Shares purchased and/or any certificates for Shares not
tendered or not purchased (and accompanying documents, as appropriate) to the
undersigned at the address shown below the undersigned signature(s). In the
event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any Shares purchased and/or return any Shares not tendered or not purchased in
the name(s) of, and mail said check and/or any certificates to, the person(s) so
indicated. The undersigned recognizes that AEP has no obligation, pursuant to
the "Special Payment Instructions", to transfer any Shares from the name of the
registered holder(s) thereof if AEP does not accept for payment any of the
Shares so tendered.
----------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 5 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be issued in the name of someone other than the undersigned.
Issue: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
---------------------------------------------------------
---------------------------------------------------------
(INCLUDE ZIP CODE)
---------------------------------------------------------
(TAXPAYER IDENTIFICATION OR
SOCIAL SECURITY NUMBER)
----------------------------------------------------------------
----------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 4 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be mailed to someone other than the undersigned or to the undersigned
at an address other than that shown below the undersigned's signature(s).
Mail: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
---------------------------------------------------------
---------------------------------------------------------
(INCLUDE ZIP CODE)
----------------------------------------------------------------
----------------------------------------------------------------
SIGNATURE(S) OF OWNER(S)
X
- --------------------------------------------------------------------------------
X
- --------------------------------------------------------------------------------
Dated: , 1997
Name(s):
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title):
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.:
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on the
stock certificate(s) or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in a
fiduciary or representative capacity, please set forth full title and see
Instruction 5.)
<PAGE> 5
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5)
Authorized Signature:
Name:
Name of Firm:
Address of Firm:
Area Code and Telephone No.:
Dated: , 1997
IF SHARES ARE BEING TENDERED, PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW OR
A FORM W-8, AS APPLICABLE.
SOLICITED TENDERS
(SEE INSTRUCTION 10)
As provided in Instruction 10, AEP will pay to any Soliciting Dealer, as
defined in Instruction 10, a solicitation fee of $1.50 per Share (except that
for transactions for beneficial owners equal to or exceeding 5,000 Shares, AEP
will pay a solicitation fee of $1.00 per Share) for any Shares tendered,
accepted for payment and paid pursuant to the Offer. However, Soliciting Dealers
will not be entitled to a solicitation fee for Shares beneficially owned by such
Soliciting Dealer.
The abovesigned represents that the Soliciting Dealer which solicited and
obtained this tender is:
Name of Firm:
(PLEASE PRINT)
Name of Individual Broker
or Financial Consultant:
Telephone Number of Broker
or Financial Consultant:
Identification Number (if known):
Address:
(INCLUDE ZIP CODE)
The following to be completed ONLY if customer's Shares held in nominee
name are tendered.
<TABLE>
<CAPTION>
NAME OF BENEFICIAL OWNER NUMBER OF SHARES TENDERED
- ------------------------ -------------------------
(ATTACH ADDITIONAL LIST IF NECESSARY)
<S> <C>
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
</TABLE>
The acceptance of compensation by such Soliciting Dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase and Proxy Statement; (c) in soliciting tenders of Shares, it
has used no solicitation materials other than those furnished by AEP; and (d) if
it is a foreign broker or dealer not eligible for membership in the National
Association of Securities Dealers, Inc. (the "NASD"), it has agreed to conform
to the NASD's Rules of Fair Practice in making solicitations.
The payment of compensation to any Soliciting Dealer is dependent on such
Soliciting Dealer returning a Notice of Solicited Tenders to the Depositary.
THIS LETTER OF TRANSMITTAL IS TO BE USED FOR THE TENDER OF SHARES OF THE
4-1/2% SERIES (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT) ONLY.
ANY PERSON DESIRING TO TENDER SHARES OF ANY OTHER SERIES OF CUMULATIVE PREFERRED
STOCK FOR WHICH AEP IS MAKING A TENDER OFFER MUST SUBMIT A LETTER OF TRANSMITTAL
RELATING TO THAT SPECIFIC SERIES.
<PAGE> 6
INSTRUCTIONS
FORMING PART OF THE
TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a firm that is a
member of a registered national securities exchange or the National Association
of Securities Dealers, Inc., or by a commercial bank or trust company having an
office or correspondent in the United States which is a participant in an
approved Medallion Signature Guarantee Program (each of the foregoing being
referred to as an "Eligible Institution"). Signatures on this Letter of
Transmittal need not be guaranteed (a) if this Letter of Transmittal is signed
by the registered holder(s) of the Shares (which term, for purposes of this
document, shall include any participant in one of the Book-Entry Transfer
Facilities whose name appears on a security position listing as the owner of
Shares) tendered herewith and such holder(s) has not completed the box above
under the heading "Special Payment Instructions" or the box above under the
heading "Special Delivery Instructions" on this Letter of Transmittal, or (b) if
such Shares are tendered for the account of an Eligible Institution. See
Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND SHARES. This Letter of
Transmittal is to be used if (a) certificates are to be forwarded herewith or,
(b) delivery of Shares is to be made by book-entry transfer pursuant to the
procedures set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. Certificates for
all physically delivered Shares, or a confirmation of a book-entry transfer into
the Depositary's account at one of the Book-Entry Transfer Facilities of all
Shares delivered electronically, as well as a properly completed and duly
executed Letter of Transmittal, and any other documents required by this Letter
of Transmittal, must be received by the Depositary at one of its addresses set
forth on the front page of this Letter of Transmittal on or prior to the
Expiration Date (as defined in the Offer to Purchase and Proxy Statement) with
respect to all Shares. Preferred Shareholders who wish to tender their Shares
yet who cannot deliver their Shares and all other required documents to the
Depositary on or prior to the Expiration Date must tender their Shares pursuant
to the guaranteed delivery procedure set forth under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement. Pursuant to such procedure: (a) such tender must be made by or
through an Eligible Institution, (b) a properly completed and duly executed
Notice of Guaranteed Delivery in the form provided by AEP (with any required
signature guarantees) must be received by the Depositary on or prior to the
applicable Expiration Date and (c) the certificates for all physically delivered
Shares, or a confirmation of a book-entry transfer into the Depositary's account
at one of the Book-Entry Transfer Facilities of all Shares delivered
electronically, together with a properly completed and duly executed Letter of
Transmittal and any other documents required by this Letter of Transmittal must
be received by the Depositary by 5:00 p.m. (New York City time) within three New
York Stock Exchange trading days after the date of execution of such Notice of
Guaranteed Delivery, all as provided under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF CERTIFICATES FOR
SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY
INSURED, IS RECOMMENDED.
No alternative, conditional or contingent tenders will be accepted. See
"Terms of the Offer -- Number of Shares; Purchase Prices; Expiration Date;
Dividends" in the Offer to Purchase and Proxy Statement. By executing this
Letter of Transmittal, the tendering stockholder waives any right to receive any
notice of the acceptance for payment of the Shares.
3. VOTING. WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES
PURSUANT TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S
AMENDED ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND
PROXY STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE
PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED
IN THE OFFER TO PURCHASE AND PROXY STATEMENT). In addition, Preferred
Shareholders have the right to vote for or against the Proposed Amendment
regardless of whether they tender their Shares by casting their vote and duly
executing the proxy enclosed herewith or by voting in person at the Special
Meeting. By executing a Notice of Guaranteed Delivery, a Preferred Shareholder
is deemed to have tendered the Shares described in such Notice of Guaranteed
Delivery and to have voted such Shares in accordance with the proxy returned
therewith, if any. If no vote is indicated on an otherwise properly executed
proxy, then all Shares in respect of such proxy will be voted in favor of the
Proposed Amendment. See "Proposed Amendment and Proxy Solicitation" in the Offer
to Purchase and Proxy Statement. The Offer is being sent to all persons in whose
names Shares are registered on the books of OPCo on the Record Date (as defined
in the Offer to Purchase and Proxy Statement) and transferees thereof. Only a
record holder of Shares on the Record Date may vote in person or by proxy at the
Special Meeting. No record date is fixed for determining which persons are
permitted to tender Shares. Any person who is the beneficial owner but not the
record holder of Shares must arrange for the record transfer of such Shares
prior to tendering.
4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the Shares represented by any
certificate delivered to the Depositary are to be tendered, fill in the number
of Shares that are to be tendered in the box above under the heading
"Description of Shares Tendered". In such case, a new certificate for the
remainder of the Shares represented by the old certificate will be sent to the
person(s) signing this Letter of Transmittal, unless otherwise provided in the
box above under the heading "Special Payment Instructions" or "Special Delivery
Instructions", as promptly as practicable following the expiration or
termination of the Offer. All Shares represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise indicated.
<PAGE> 7
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL AND/OR NOTICE OF GUARANTEED
DELIVERY; STOCK POWERS AND ENDORSEMENTS. If either this Letter of Transmittal
or the Notice of Guaranteed Delivery (together, the "Tender Documents") is
signed by the registered holder(s) of the Shares tendered hereby, the
signature(s) must correspond with the name(s) as written on the face of the
certificates without alteration, enlargement or any change whatsoever.
If any of the Shares tendered under either Tender Document is held of
record by two or more persons, all such persons must sign such Tender Document.
If any of the Shares tendered under either Tender Document is registered in
different names or different certificates, it will be necessary to complete,
sign and submit as many separate applicable Tender Documents as there are
different registrations or certificates.
If either Tender Document is signed by the registered holder(s) of the
Shares tendered hereby, no endorsements of certificates or separate stock powers
are required unless payment of the purchase price is to be made to, or Shares
not tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s). Signatures on any such certificates or
stock powers must be guaranteed by an Eligible Institution. See Instruction 1.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates must be
endorsed or accompanied by appropriate stock powers, in either case, signed
exactly as the name(s) of the registered holder(s) appear(s) on the certificates
for such Shares. Signature(s) on any such certificates or stock powers must be
guaranteed by an Eligible Institution. See Instruction 1.
If either Tender Document or any certificate or stock power is signed by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
AEP of the authority of such person so to act must be submitted.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, AEP
will pay or cause to be paid any stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price is to be made to, or Shares not tendered
or not purchased are to be registered in the name of, any person other than the
registered holder(s), or if tendered Shares are registered in the name of any
person other than the person(s) signing this Letter of Transmittal, the amount
of any stock transfer taxes (whether imposed on the registered holder(s), such
other person or otherwise) payable on account of the transfer to such person
will be deducted from the purchase price unless satisfactory evidence of the
payment of such taxes, or exemption therefrom, is submitted. See "Terms of the
Offer -- Acceptance of Shares for Payment and Payment of Purchase Price and
Dividends" in the Offer to Purchase and Proxy Statement. EXCEPT AS PROVIDED IN
THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE
CERTIFICATES REPRESENTING SHARES TENDERED HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any Shares purchased is to be issued in the name of, and/or
any Shares not tendered or not purchased are to be returned to, a person other
than the person(s) signing this Letter of Transmittal or if the check and/or any
certificate for Shares not tendered or not purchased are to be mailed to someone
other than the person(s) signing this Letter of Transmittal or to an address
other than that shown in the box above under the heading "Name(s) and
Address(es) of Registered Holder(s)", then the "Special Payment Instructions"
and/or "Special Delivery Instructions" on this Letter of Transmittal should be
completed. Preferred Shareholders tendering Shares by book-entry transfer will
have any Shares not accepted for payment returned by crediting the account
maintained by such Preferred Shareholder at the Book-Entry Transfer Facility
from which such transfer was made.
8. SUBSTITUTE FORM W-9 AND FORM W-8. The tendering Preferred Shareholder
is required to provide the Depositary with either a correct Taxpayer
Identification Number ("TIN") on Substitute Form W-9, which is provided under
"Important Tax Information" below, or a properly completed Form W-8. Failure to
provide the information on either Substitute Form W-9 or Form W-8 may subject
the tendering Preferred Shareholder to a $50 penalty imposed by the Internal
Revenue Service and to 31% federal income tax backup withholding on the payment
of the purchase price for the Shares. The box in Part 2 of Substitute Form W-9
may be checked if the tendering Preferred Shareholder has not been issued a TIN
and has applied for a number or intends to apply for a number in the near
future. If the box in Part 2 is checked and the Depositary is not provided with
a TIN by the time of payment, the Depositary will withhold 31% on all payments
of the purchase price for the Shares thereafter until a TIN is provided to the
Depositary.
9. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Any questions or
requests for assistance may be directed to the Information Agent or the Dealer
Managers at their respective telephone numbers and addresses listed below.
Requests for additional copies of the Offer to Purchase and Proxy Statement,
this Letter of Transmittal or other tender offer materials may be directed to
the Information Agent and such copies will be furnished promptly at AEP's
expense. Preferred Shareholders may also contact their local broker, dealer,
commercial bank or trust company for assistance concerning the Offer.
<PAGE> 8
10. SOLICITED TENDERS. AEP will pay a solicitation fee of $1.50 per Share
(except that for transactions for beneficial owners tendering more than 5,000
Shares, AEP will pay a solicitation fee of $1.00 per Share) for any Shares
tendered, accepted for payment and paid pursuant to the Offer, covered by the
Letter of Transmittal which designates, under the heading "Solicited Tenders",
as having solicited and obtained the tender, the name of (a) any broker or
dealer in securities, including a Dealer Manager in its capacity as a dealer or
broker, which is a member of any national securities exchange or of the National
Association of Securities Dealers, Inc. (the "NASD"), (b) any foreign broker or
dealer not eligible for membership in the NASD which agrees to conform to the
NASD's Rules of Fair Practice in soliciting tenders outside the United States to
the same extent as though it were an NASD member, or (c) any bank or trust
company (each of which is referred to herein as a "Soliciting Dealer"). No such
fee shall be payable to a Soliciting Dealer with respect to the tender of Shares
by a holder unless the Letter of Transmittal accompanying such tender designates
such Soliciting Dealer. No such fee shall be payable to a Soliciting Dealer in
respect of Shares registered in the name of such Soliciting Dealer unless such
Shares are held by such Soliciting Dealer as nominee and such Shares are being
tendered for the benefit of one or more beneficial owners identified on the
Letter of Transmittal or on the Notice of Solicited Tenders (included in the
materials provided to brokers and dealers). No such fee shall be payable to a
Soliciting Dealer with respect to the tender of Shares by the holder of record,
for the benefit of the beneficial owner, unless the beneficial owner has
designated such Soliciting Dealer. If tendered Shares are being delivered by
book-entry transfer, the Soliciting Dealer must return a Notice of Solicited
Tenders to the Depositary within three business days after expiration of the
Offer to receive a solicitation fee. No such fee shall be payable to a
Soliciting Dealer if such Soliciting Dealer is required for any reason to
transfer the amount of such fee to a depositing holder (other than itself). No
such fee shall be paid to a Soliciting Dealer with respect to Shares tendered
for such Soliciting Dealer's own account. No broker, dealer, bank, trust company
or fiduciary shall be deemed to be the agent of AEP, the Depositary, the
Information Agent or the Dealer Managers for purposes of the Offer.
Soliciting Dealers will include any organizations described in clauses (a),
(b) or (c) above even when the activities of such organization in connection
with the Offer consist solely of forwarding to clients materials relating to the
Offer, including this Letter of Transmittal, and rendering Shares as directed by
beneficial owners thereof. No Soliciting Dealer is required to make any
recommendation to holders of Shares as to whether to tender or refrain from
tendering in the Offer. No assumption is made, in making payment to any
Soliciting Dealer, that its activities in connection with the Offer included any
activities other than those described above, and for all purposes noted in all
materials relating to the Offer, the term "solicit" shall be deemed to mean no
more than "processing shares tendered" or "forwarding to customers materials
regarding the Offer."
11. IRREGULARITIES. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance of any tender
of Shares will be determined by AEP, in its sole discretion, and its
determination shall be final and binding. AEP reserves the absolute right to
reject any and all tenders of Shares that it determines are not in proper form
or the acceptance for payment of or payment for Shares that may, in the opinion
of AEP's counsel, be unlawful. AEP also reserves the absolute right to waive any
of the conditions to the Offer or any defect or irregularity in any tender of
Shares and AEP's interpretation of the terms and conditions of the Offer
(including these instructions) shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as AEP shall determine. None of AEP, OPCo, the Dealer Managers, the
Depositary, the Information Agent or any other person shall be under any duty to
give notice of any defect or irregularity in tenders, nor shall any of them
incur any liability for failure to give any such notice. Tenders will not be
deemed to have been made until all defects and irregularities have been cured or
waived.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any of your certificate(s)
for Shares have been lost, stolen or destroyed, please call the Depositary at
1-800-649-2153. In addition, you should advise the Depositary of any
certificate(s) you have in your possession. You will need to complete an
Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by the Depositary) and pay an indemnity bond premium fee. The tender of
Shares pursuant to this Letter of Transmittal will not be valid unless prior to
the Expiration Date: (a) such procedures have been completed and a replacement
certificate for the Shares has been delivered to the Depositary or (b) a Notice
of Guaranteed Delivery has been delivered to the Depositary. See Instruction 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL, DULY EXECUTED, TOGETHER WITH, IF
APPLICABLE, CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER, AND ALL OTHER
REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR, IF APPLICABLE, THE
NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY, ON OR PRIOR TO
THE APPLICABLE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under federal income tax law, a Preferred Shareholder whose tendered Shares
are accepted for payment is required to provide the Depositary (as payer) with
either such Preferred Shareholder's correct TIN on Substitute Form W-9 below or
a properly completed Form W-8. If such Preferred Shareholder is an individual,
the TIN is his or her social security number. For businesses and other entities,
the number is the federal employer identification number. If the Depositary is
not provided with the correct TIN or properly completed Form W-8, the Preferred
Shareholder may be subject to a $50 penalty imposed by the Internal Revenue
Code. In addition, payments that are made to such Preferred Shareholder with
respect to Shares purchased pursuant to the Offer may be subject to 31% backup
withholding.
<PAGE> 9
Certain Preferred Shareholders (including, among others, all corporations
and certain foreign individuals) are exempt from backup withholding. For a
corporate United States Preferred Shareholder to qualify for such exemption,
such Preferred Shareholder must provide the Depositary with a properly completed
and executed Substitute Form W-9 attesting to its exempt status. In order for a
foreign Preferred Shareholder to qualify as an exempt recipient, such Preferred
Shareholder must submit to the Depositary a properly completed Internal Revenue
Service Form W-8 (a "Form W-8"), signed under penalties of perjury, attesting to
that Preferred Shareholder's exempt status. A Form W-8 can be obtained from the
Depositary. See the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional instructions.
If federal income tax backup withholding applies, the Depositary is
required to withhold 31% of any payments made to the Preferred Shareholder.
Backup withholding is not an additional tax. Rather, the Federal income tax
liability of persons subject to backup withholding will be reduced by the amount
of the tax withheld. If withholding results in an overpayment of taxes, a refund
may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on payments that are made to a Preferred
Shareholder with respect to Shares purchased pursuant to the Offer, the
Preferred Shareholder is required to notify the Depositary of his or her correct
TIN by completing the Substitute Form W-9 attached hereto certifying that the
TIN provided on Substitute Form W-9 is correct and that (a) the Preferred
Shareholder has not been notified by the Internal Revenue Service that he or she
is subject to federal income tax backup withholding as a result of failure to
report all interest or dividends or (b) the Internal Revenue Service has
notified the Preferred Shareholder that he or she is no longer subject to
federal income tax backup withholding. Foreign Preferred Shareholders must
submit a properly completed Form W-8 in order to avoid the applicable backup
withholding.
WHAT NUMBER TO GIVE THE DEPOSITARY
The Preferred Shareholder is required to give the Depositary the social
security number or employer identification number of the registered owner of the
Shares. If the Shares are in more than one name or are not in the name of the
actual owner, consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional guidance on which
number to report.
PAYER'S NAME: FIRST CHICAGO TRUST COMPANY OF NEW YORK
<TABLE>
<CAPTION>
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<S> <C>
Part 1 -- PLEASE PROVIDE YOUR TIN IN THE Social Security Number OR
BOX AT RIGHT AND CERTIFY BY SIGNING AND Employer Identification Number
DATING BELOW. TIN ______________________________
---------------------------------------------------------------------------------------
SUBSTITUTE Name (Please Print)____________________
Address Part 2 --
City State _____________ Zip Code _____ Awaiting TIN [ ]
---------------------------------------------------------------------------------------
FORM W-9 Part 3 -- CERTIFICATION -- UNDER PENALTIES OF PERJURY. I CERTIFY THAT: (1) the number
DEPARTMENT OF THE TREASURY shown on the form is my correct taxpayer identification number (or a TIN has not been
INTERNAL REVENUE SERVICE issued to me but I have mailed or delivered an application to receive a TIN or intend
to do so in the near future), (2) I am not subject to backup withholding either because
I have not been notified by the Internal Revenue Service (the "IRS") that I am subject
to backup withholding as a result of a failure to report all interest or dividends or
the IRS has notified me that I am no longer subject to backup withholding and (3) all
other information provided on this form is true, correct and complete.
SIGNATURE ____________________________________________ DATE_____________________ 1997
You must cross out item (2) above if you have been notified by the IRS that you are
currently subject to backup withholding because of underreporting interest or dividends
on your tax return.
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PAYER'S REQUEST FOR TAXPAYER NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31%
IDENTIFICATION NUMBER ("TIN") OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE ENCLOSED
AND CERTIFICATION GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9
FOR ADDITIONAL DETAILS. YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE
BOX IN PART 2 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has not been
issued to me and either (1) I have mailed or delivered an application to receive a
taxpayer identification number to the appropriate Internal Revenue Service Center or
Social Security Administration Office or (2) I intend to do so in the near future. I
understand that if I do not provide a taxpayer identification number by the time of
payment, 31% of all payments of the purchase price made to me will be withheld until I
provide a number.
SIGNATURE _________________________________________ Date: _____________________ 1997.
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</TABLE>
<PAGE> 10
THE DEALER MANAGERS:
<TABLE>
<S> <C>
MERRILL LYNCH & CO. SALOMON BROTHERS INC
World Financial Center Seven World Trade Center
250 Vesey Street New York, New York 10048
New York, New York 10281 Attn: Liability Management Department
(888) ML4-TNDR (toll free) (800) 558-3745 (toll free)
((888) 654-8637 (toll free))
</TABLE>
THE INFORMATION AGENT:
MORROW & CO., INC.
909 Third Avenue
New York, New York 10022-4799
(800) 566-9061 (call toll free)
(212) 754-8000
<PAGE> 11
4.08% OPCO
LETTER OF TRANSMITTAL
TO ACCOMPANY
SHARES OF 4.08% SERIES CUMULATIVE PREFERRED STOCK
CUSIP NUMBER 677415 10 1
OF
OHIO POWER COMPANY
TENDERED PURSUANT TO THE OFFER TO PURCHASE FOR CASH
BY
AMERICAN ELECTRIC POWER COMPANY, INC.
DATED JANUARY 30, 1997, FOR PURCHASE AT A
PURCHASE PRICE OF $64.56 PER SHARE
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON FRIDAY, FEBRUARY 28, 1997, UNLESS THE OFFER IS EXTENDED.
TO: FIRST CHICAGO TRUST COMPANY OF NEW YORK, DEPOSITARY
<TABLE>
<S> <C> <C>
BY MAIL: BY HAND: BY OVERNIGHT COURIER:
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
P.O. Box 2569 c/o The Depository Trust Company 14 Wall Street, 8th
Suite 4660 55 Water Street, DTC TAD Floor
Jersey City, NJ 07303-2569 Vietnam Veterans Memorial Plaza Suite 4680-OPCO
New York, NY 10041 New York, NY 10005
</TABLE>
AMERICAN ELECTRIC POWER COMPANY, INC. ("AEP") WILL NOT BE REQUIRED TO
ACCEPT FOR PAYMENT OR PAY FOR ANY SHARES TENDERED IF THE PROPOSED AMENDMENT IS
NOT APPROVED AND ADOPTED AT THE SPECIAL MEETING. PREFERRED SHAREHOLDERS OF
RECORD OF OHIO POWER COMPANY ("OPCO") HAVE THE RIGHT TO VOTE FOR OR AGAINST THE
PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES BY CASTING
THEIR VOTE AND SIGNING THE PROXY ENCLOSED HEREWITH OR BY VOTING IN PERSON AT THE
SPECIAL MEETING. IF THE PROPOSED AMENDMENT IS APPROVED AND ADOPTED BY OPCO'S
SHAREHOLDERS, OPCO WILL MAKE A SPECIAL CASH PAYMENT TO EACH PREFERRED
SHAREHOLDER WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT THEIR
SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
- --------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDERS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NOTE: IF SHARES ARE BEING TENDERED, THE REMAINDER OF THIS LETTER OF TRANSMITTAL
MUST BE COMPLETED, INCLUDING, IF APPLICABLE, THE SUBSTITUTE FORM W-9
BELOW.
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS LETTER OF
TRANSMITTAL IN THE APPROPRIATE SPACE THEREFOR PROVIDED AND, IF YOU ARE TENDERING
ANY SHARES, COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW OR A FORM W-8, AS
APPLICABLE. SEE INSTRUCTION 8 AND "IMPORTANT TAX INFORMATION" BELOW.
DO NOT SEND ANY CERTIFICATES TO MERRILL LYNCH & CO., SALOMON BROTHERS INC,
MORROW & CO., INC., AMERICAN ELECTRIC POWER COMPANY, INC. OR OHIO POWER COMPANY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED. QUESTIONS REGARDING
AND REQUESTS FOR COPIES OF THE OFFER TO PURCHASE AND PROXY STATEMENT OR THIS
LETTER OF TRANSMITTAL MAY BE DIRECTED TO MORROW & CO., INC., THE INFORMATION
AGENT, AT 909 THIRD AVENUE, NEW YORK, NEW YORK 10022-4799 OR TELEPHONE (800)
566-9061 (TOLL FREE).
<PAGE> 12
This Letter of Transmittal is to be used (a) if certificates are to be
forwarded to the First Chicago Trust Company of New York ("Depositary") or (b)
if delivery of tendered Shares (as defined below) is to be made by book-entry
transfer to the Depositary's account at The Depository Trust Company ("DTC") or
the Philadelphia Depository Trust Company ("PDTC") (hereinafter collectively
referred to as the "Book-Entry Transfer Facilities") pursuant to the procedures
set forth under the heading "Terms of the Offer -- Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement (as defined below).
Preferred Shareholders (as defined below) who wish to tender Shares but who
cannot deliver their Shares and all other documents required hereby to the
Depositary by the Expiration Date (as defined in the Offer to Purchase and Proxy
Statement) must tender their Shares pursuant to the guaranteed delivery
procedure set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. See Instruction
2. DELIVERY OF DOCUMENTS TO AEP, OPCO OR A BOOK-ENTRY TRANSFER FACILITY DOES NOT
CONSTITUTE A VALID DELIVERY.
- --------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
(IF TENDERING SHARES, PLEASE FILL IN EXACTLY AS INFORMATION APPEARS ON
CERTIFICATE(S))
(ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------
TOTAL NUMBER OF SHARES
CERTIFICATE NUMBER(S)* REPRESENTED BY CERTIFICATE(S) NUMBER OF SHARES TENDERED**
- -----------------------------------------------------------------------------------------
<S> <C> <C>
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented by
any certificates delivered to the Depositary are being tendered. See
Instruction 4.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Depositary at 1-800-649-2153. In addition, you should
advise the Depositary of any certificate(s) you have in your possession. You
will need to complete an Affidavit of Loss with respect to the lost
certificate(s) (which will be provided by the Depositary) and pay an indemnity
bond premium fee.
(BOXES BELOW FOR USE BY ELIGIBLE INSTITUTIONS ONLY)
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
TO THE DEPOSITARY'S ACCOUNT AT A BOOK-ENTRY TRANSFER FACILITY AND
COMPLETE THE FOLLOWING:
Name of tendering institution
Account No.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE
OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE
THE FOLLOWING:
Name(s) of tendering shareholder(s)
Date of execution of Notice of Guaranteed Delivery
Name of institution that guaranteed delivery
If delivery is by book-entry transfer:
Name of tendering institution
Account no.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
<PAGE> 13
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to American Electric Power Company, Inc., a
New York corporation ("AEP"), the shares in the amount set forth in the box
above designated "Description of Shares Tendered" pursuant to AEP's offer to
purchase any and all of the outstanding shares of the series of cumulative
preferred stock of Ohio Power Company, an Ohio corporation, and direct utility
subsidiary of AEP ("OPCo"), shown on the first page hereof as to which this
Letter of Transmittal is applicable (the "Shares") at the purchase price per
Share shown on the first page hereof plus accrued and unpaid dividends thereon,
net to the seller in cash, upon the terms and subject to the conditions set
forth in the Offer to Purchase and Proxy Statement, dated January 30, 1997 (the
"Offer to Purchase and Proxy Statement"), receipt of which is hereby
acknowledged, and in this Letter of Transmittal (which as to the Shares,
together with the Offer to Purchase and Proxy Statement, constitutes the
"Offer"). WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT
TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S AMENDED
ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND PROXY
STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE PROPOSED
AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED IN THE
OFFER TO PURCHASE AND PROXY STATEMENT). See "Proposed Amendment and Proxy
Solicitation", "Terms of the Offer -- Extension of Tender Period; Termination;
Amendments" and "Terms of the Offer -- Certain Conditions of the Offer" in the
Offer to Purchase and Proxy Statement.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the undersigned hereby
sells, assigns and transfers to, or upon the order of, AEP all right, title and
interest in and to all the Shares that are being tendered hereby and hereby
constitutes and appoints First Chicago Trust Company of New York (the
"Depositary") the true and lawful agent and attorney-in-fact of the undersigned
with respect to such Shares, with full power of substitution (such power of
attorney being an irrevocable power coupled with an interest), to (a) deliver
certificates for such Shares, or transfer ownership of such Shares on the
account books maintained by the Book-Entry Transfer Facility that holds such
Shares, together, in any such case, with all accompanying evidences of transfer
and authenticity, to or upon the order of AEP, (b) present such Shares for
registration and transfer on the books of OPCo and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, all in
accordance with the terms of the Offer. The Depositary will act as agent for
tendering stockholders for the purpose of receiving payment from AEP and
transmitting payment to tendering stockholders.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Shares
tendered hereby and that, when and to the extent the same are accepted for
payment by AEP, AEP will acquire good, marketable and unencumbered title
thereto, free and clear of all liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the same will not be subject to any adverse claims. The
undersigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or AEP to be necessary or desirable to complete the
sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by, and shall survive the death, bankruptcy or incapacity of the
undersigned, and any obligations of the undersigned hereunder shall be binding
upon the heirs, legal representatives, successors, assigns, executors and
administrators of the undersigned. Except as stated in the Offer, this tender is
irrevocable.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and in the
instructions hereto will constitute the undersigned's acceptance of the terms
and conditions of the Offer, including the undersigned's representation and
warranty that (a) the undersigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (b) the tender of such Shares complies
with such Rule 14e-4. AEP's acceptance for payment of Shares tendered pursuant
to the Offer will constitute a binding agreement between the undersigned and AEP
upon the terms and subject to the conditions of the Offer.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase and Proxy Statement, AEP may terminate or amend the Offer
or may not be required to purchase any of the Shares tendered hereby. In either
event, the undersigned understands that certificate(s) for any Shares not
tendered or not purchased will be returned to the undersigned.
<PAGE> 14
Unless otherwise indicated in the box below under the heading "Special
Payment Instructions", please issue the check for the purchase price of any
Shares purchased, and/or return any Shares not tendered or not purchased, in the
name(s) of the undersigned (and, in the case of Shares tendered by book-entry
transfer, by credit to the account at the Book-Entry Transfer Facility
designated above). Similarly, unless otherwise indicated in the box below under
the heading "Special Delivery Instructions", please mail the check for the
purchase price of any Shares purchased and/or any certificates for Shares not
tendered or not purchased (and accompanying documents, as appropriate) to the
undersigned at the address shown below the undersigned signature(s). In the
event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any Shares purchased and/or return any Shares not tendered or not purchased in
the name(s) of, and mail said check and/or any certificates to, the person(s) so
indicated. The undersigned recognizes that AEP has no obligation, pursuant to
the "Special Payment Instructions", to transfer any Shares from the name of the
registered holder(s) thereof if AEP does not accept for payment any of the
Shares so tendered.
----------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 5 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be issued in the name of someone other than the undersigned.
Issue: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
---------------------------------------------------------
---------------------------------------------------------
(INCLUDE ZIP CODE)
---------------------------------------------------------
(TAXPAYER IDENTIFICATION OR
SOCIAL SECURITY NUMBER)
---------------------------------------------------------
---------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 4 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be mailed to someone other than the undersigned or to the undersigned
at an address other than that shown below the undersigned's signature(s).
Mail: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
---------------------------------------------------------
---------------------------------------------------------
(INCLUDE ZIP CODE)
---------------------------------------------------------
---------------------------------------------------------
SIGNATURE(S) OF OWNER(S)
X
- --------------------------------------------------------------------------------
X
- --------------------------------------------------------------------------------
Dated: , 1997
Name(s):
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title):
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.:
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on the
stock certificate(s) or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in a
fiduciary or representative capacity, please set forth full title and see
Instruction 5.)
<PAGE> 15
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5)
Authorized Signature:
Name:
Name of Firm:
Address of Firm:
Area Code and Telephone No.:
Dated: , 1997
IF SHARES ARE BEING TENDERED, PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW OR
A FORM W-8, AS APPLICABLE.
SOLICITED TENDERS
(SEE INSTRUCTION 10)
As provided in Instruction 10, AEP will pay to any Soliciting Dealer, as
defined in Instruction 10, a solicitation fee of $1.50 per Share (except that
for transactions for beneficial owners equal to or exceeding 5,000 Shares, AEP
will pay a solicitation fee of $1.00 per Share) for any Shares tendered,
accepted for payment and paid pursuant to the Offer. However, Soliciting Dealers
will not be entitled to a solicitation fee for Shares beneficially owned by such
Soliciting Dealer.
The abovesigned represents that the Soliciting Dealer which solicited and
obtained this tender is:
Name of Firm:
(PLEASE PRINT)
Name of Individual Broker
or Financial Consultant:
Telephone Number of Broker
or Financial Consultant:
Identification Number (if known):
Address:
(INCLUDE ZIP CODE)
The following to be completed ONLY if customer's Shares held in nominee
name are tendered.
<TABLE>
<CAPTION>
NAME OF BENEFICIAL OWNER NUMBER OF SHARES TENDERED
- ------------------------ -------------------------
(ATTACH ADDITIONAL LIST IF NECESSARY)
<S> <C>
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
</TABLE>
The acceptance of compensation by such Soliciting Dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase and Proxy Statement; (c) in soliciting tenders of Shares, it
has used no solicitation materials other than those furnished by AEP; and (d) if
it is a foreign broker or dealer not eligible for membership in the National
Association of Securities Dealers, Inc. (the "NASD"), it has agreed to conform
to the NASD's Rules of Fair Practice in making solicitations.
The payment of compensation to any Soliciting Dealer is dependent on such
Soliciting Dealer returning a Notice of Solicited Tenders to the Depositary.
THIS LETTER OF TRANSMITTAL IS TO BE USED FOR THE TENDER OF SHARES OF THE
4.08% SERIES (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT) ONLY. ANY
PERSON DESIRING TO TENDER SHARES OF ANY OTHER SERIES OF CUMULATIVE PREFERRED
STOCK FOR WHICH AEP IS MAKING A TENDER OFFER MUST SUBMIT A LETTER OF TRANSMITTAL
RELATING TO THAT SPECIFIC SERIES.
<PAGE> 16
INSTRUCTIONS
FORMING PART OF THE
TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a firm that is a
member of a registered national securities exchange or the National Association
of Securities Dealers, Inc., or by a commercial bank or trust company having an
office or correspondent in the United States which is a participant in an
approved Medallion Signature Guarantee Program (each of the foregoing being
referred to as an "Eligible Institution"). Signatures on this Letter of
Transmittal need not be guaranteed (a) if this Letter of Transmittal is signed
by the registered holder(s) of the Shares (which term, for purposes of this
document, shall include any participant in one of the Book-Entry Transfer
Facilities whose name appears on a security position listing as the owner of
Shares) tendered herewith and such holder(s) has not completed the box above
under the heading "Special Payment Instructions" or the box above under the
heading "Special Delivery Instructions" on this Letter of Transmittal, or (b) if
such Shares are tendered for the account of an Eligible Institution. See
Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND SHARES. This Letter of
Transmittal is to be used if (a) certificates are to be forwarded herewith or,
(b) delivery of Shares is to be made by book-entry transfer pursuant to the
procedures set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. Certificates for
all physically delivered Shares, or a confirmation of a book-entry transfer into
the Depositary's account at one of the Book-Entry Transfer Facilities of all
Shares delivered electronically, as well as a properly completed and duly
executed Letter of Transmittal, and any other documents required by this Letter
of Transmittal, must be received by the Depositary at one of its addresses set
forth on the front page of this Letter of Transmittal on or prior to the
Expiration Date (as defined in the Offer to Purchase and Proxy Statement) with
respect to all Shares. Preferred Shareholders who wish to tender their Shares
yet who cannot deliver their Shares and all other required documents to the
Depositary on or prior to the Expiration Date must tender their Shares pursuant
to the guaranteed delivery procedure set forth under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement. Pursuant to such procedure: (a) such tender must be made by or
through an Eligible Institution, (b) a properly completed and duly executed
Notice of Guaranteed Delivery in the form provided by AEP (with any required
signature guarantees) must be received by the Depositary on or prior to the
applicable Expiration Date and (c) the certificates for all physically delivered
Shares, or a confirmation of a book-entry transfer into the Depositary's account
at one of the Book-Entry Transfer Facilities of all Shares delivered
electronically, together with a properly completed and duly executed Letter of
Transmittal and any other documents required by this Letter of Transmittal must
be received by the Depositary by 5:00 p.m. (New York City time) within three New
York Stock Exchange trading days after the date of execution of such Notice of
Guaranteed Delivery, all as provided under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF CERTIFICATES FOR
SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY
INSURED, IS RECOMMENDED.
No alternative, conditional or contingent tenders will be accepted. See
"Terms of the Offer -- Number of Shares; Purchase Prices; Expiration Date;
Dividends" in the Offer to Purchase and Proxy Statement. By executing this
Letter of Transmittal, the tendering stockholder waives any right to receive any
notice of the acceptance for payment of the Shares.
3. VOTING. WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES
PURSUANT TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S
AMENDED ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND
PROXY STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE
PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED
IN THE OFFER TO PURCHASE AND PROXY STATEMENT). In addition, Preferred
Shareholders have the right to vote for or against the Proposed Amendment
regardless of whether they tender their Shares by casting their vote and duly
executing the proxy enclosed herewith or by voting in person at the Special
Meeting. By executing a Notice of Guaranteed Delivery, a Preferred Shareholder
is deemed to have tendered the Shares described in such Notice of Guaranteed
Delivery and to have voted such Shares in accordance with the proxy returned
therewith, if any. If no vote is indicated on an otherwise properly executed
proxy, then all Shares in respect of such proxy will be voted in favor of the
Proposed Amendment. See "Proposed Amendment and Proxy Solicitation" in the Offer
to Purchase and Proxy Statement. The Offer is being sent to all persons in whose
names Shares are registered on the books of OPCo on the Record Date (as defined
in the Offer to Purchase and Proxy Statement) and transferees thereof. Only a
record holder of Shares on the Record Date may vote in person or by proxy at the
Special Meeting. No record date is fixed for determining which persons are
permitted to tender Shares. Any person who is the beneficial owner but not the
record holder of Shares must arrange for the record transfer of such Shares
prior to tendering.
4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the Shares represented by any
certificate delivered to the Depositary are to be tendered, fill in the number
of Shares that are to be tendered in the box above under the heading
"Description of Shares Tendered". In such case, a new certificate for the
remainder of the Shares represented by the old certificate will be sent to the
person(s) signing this Letter of Transmittal, unless otherwise provided in the
box above under the heading "Special Payment Instructions" or "Special Delivery
Instructions", as promptly as practicable following the expiration or
termination of the Offer. All Shares represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise indicated.
<PAGE> 17
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL AND/OR NOTICE OF GUARANTEED
DELIVERY; STOCK POWERS AND ENDORSEMENTS. If either this Letter of Transmittal
or the Notice of Guaranteed Delivery (together, the "Tender Documents") is
signed by the registered holder(s) of the Shares tendered hereby, the
signature(s) must correspond with the name(s) as written on the face of the
certificates without alteration, enlargement or any change whatsoever.
If any of the Shares tendered under either Tender Document is held of
record by two or more persons, all such persons must sign such Tender Document.
If any of the Shares tendered under either Tender Document is registered in
different names or different certificates, it will be necessary to complete,
sign and submit as many separate applicable Tender Documents as there are
different registrations or certificates.
If either Tender Document is signed by the registered holder(s) of the
Shares tendered hereby, no endorsements of certificates or separate stock powers
are required unless payment of the purchase price is to be made to, or Shares
not tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s). Signatures on any such certificates or
stock powers must be guaranteed by an Eligible Institution. See Instruction 1.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates must be
endorsed or accompanied by appropriate stock powers, in either case, signed
exactly as the name(s) of the registered holder(s) appear(s) on the certificates
for such Shares. Signature(s) on any such certificates or stock powers must be
guaranteed by an Eligible Institution. See Instruction 1.
If either Tender Document or any certificate or stock power is signed by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
AEP of the authority of such person so to act must be submitted.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, AEP
will pay or cause to be paid any stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price is to be made to, or Shares not tendered
or not purchased are to be registered in the name of, any person other than the
registered holder(s), or if tendered Steven P. JohnsonShares are registered in
the name of any person other than the person(s) signing this Letter of
Transmittal, the amount of any stock transfer taxes (whether imposed on the
registered holder(s), such other person or otherwise) payable on account of the
transfer to such person will be deducted from the purchase price unless
satisfactory evidence of the payment of such taxes, or exemption therefrom, is
submitted. See "Terms of the Offer -- Acceptance of Shares for Payment and
Payment of Purchase Price and Dividends" in the Offer to Purchase and Proxy
Statement. EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY TO
AFFIX TRANSFER TAX STAMPS TO THE CERTIFICATES REPRESENTING SHARES TENDERED
HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any Shares purchased is to be issued in the name of, and/or
any Shares not tendered or not purchased are to be returned to, a person other
than the person(s) signing this Letter of Transmittal or if the check and/or any
certificate for Shares not tendered or not purchased are to be mailed to someone
other than the person(s) signing this Letter of Transmittal or to an address
other than that shown in the box above under the heading "Name(s) and
Address(es) of Registered Holder(s)", then the "Special Payment Instructions"
and/or "Special Delivery Instructions" on this Letter of Transmittal should be
completed. Preferred Shareholders tendering Shares by book-entry transfer will
have any Shares not accepted for payment returned by crediting the account
maintained by such Preferred Shareholder at the Book-Entry Transfer Facility
from which such transfer was made.
8. SUBSTITUTE FORM W-9 AND FORM W-8. The tendering Preferred Shareholder
is required to provide the Depositary with either a correct Taxpayer
Identification Number ("TIN") on Substitute Form W-9, which is provided under
"Important Tax Information" below, or a properly completed Form W-8. Failure to
provide the information on either Substitute Form W-9 or Form W-8 may subject
the tendering Preferred Shareholder to a $50 penalty imposed by the Internal
Revenue Service and to 31% federal income tax backup withholding on the payment
of the purchase price for the Shares. The box in Part 2 of Substitute Form W-9
may be checked if the tendering Preferred Shareholder has not been issued a TIN
and has applied for a number or intends to apply for a number in the near
future. If the box in Part 2 is checked and the Depositary is not provided with
a TIN by the time of payment, the Depositary will withhold 31% on all payments
of the purchase price for the Shares thereafter until a TIN is provided to the
Depositary.
9. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Any questions or
requests for assistance may be directed to the Information Agent or the Dealer
Managers at their respective telephone numbers and addresses listed below.
Requests for additional copies of the Offer to Purchase and Proxy Statement,
this Letter of Transmittal or other tender offer materials may be directed to
the Information Agent and such copies will be furnished promptly at AEP's
expense. Preferred Shareholders may also contact their local broker, dealer,
commercial bank or trust company for assistance concerning the Offer.
<PAGE> 18
10. SOLICITED TENDERS. AEP will pay a solicitation fee of $1.50 per Share
(except that for transactions for beneficial owners tendering more than 5,000
Shares, AEP will pay a solicitation fee of $1.00 per Share) for any Shares
tendered, accepted for payment and paid pursuant to the Offer, covered by the
Letter of Transmittal which designates, under the heading "Solicited Tenders",
as having solicited and obtained the tender, the name of (a) any broker or
dealer in securities, including a Dealer Manager in its capacity as a dealer or
broker, which is a member of any national securities exchange or of the National
Association of Securities Dealers, Inc. (the "NASD"), (b) any foreign broker or
dealer not eligible for membership in the NASD which agrees to conform to the
NASD's Rules of Fair Practice in soliciting tenders outside the United States to
the same extent as though it were an NASD member, or (c) any bank or trust
company (each of which is referred to herein as a "Soliciting Dealer"). No such
fee shall be payable to a Soliciting Dealer with respect to the tender of Shares
by a holder unless the Letter of Transmittal accompanying such tender designates
such Soliciting Dealer. No such fee shall be payable to a Soliciting Dealer in
respect of Shares registered in the name of such Soliciting Dealer unless such
Shares are held by such Soliciting Dealer as nominee and such Shares are being
tendered for the benefit of one or more beneficial owners identified on the
Letter of Transmittal or on the Notice of Solicited Tenders (included in the
materials provided to brokers and dealers). No such fee shall be payable to a
Soliciting Dealer with respect to the tender of Shares by the holder of record,
for the benefit of the beneficial owner, unless the beneficial owner has
designated such Soliciting Dealer. If tendered Shares are being delivered by
book-entry transfer, the Soliciting Dealer must return a Notice of Solicited
Tenders to the Depositary within three business days after expiration of the
Offer to receive a solicitation fee. No such fee shall be payable to a
Soliciting Dealer if such Soliciting Dealer is required for any reason to
transfer the amount of such fee to a depositing holder (other than itself). No
such fee shall be paid to a Soliciting Dealer with respect to Shares tendered
for such Soliciting Dealer's own account. No broker, dealer, bank, trust company
or fiduciary shall be deemed to be the agent of AEP, the Depositary, the
Information Agent or the Dealer Managers for purposes of the Offer.
Soliciting Dealers will include any organizations described in clauses (a),
(b) or (c) above even when the activities of such organization in connection
with the Offer consist solely of forwarding to clients materials relating to the
Offer, including this Letter of Transmittal, and rendering Shares as directed by
beneficial owners thereof. No Soliciting Dealer is required to make any
recommendation to holders of Shares as to whether to tender or refrain from
tendering in the Offer. No assumption is made, in making payment to any
Soliciting Dealer, that its activities in connection with the Offer included any
activities other than those described above, and for all purposes noted in all
materials relating to the Offer, the term "solicit" shall be deemed to mean no
more than "processing shares tendered" or "forwarding to customers materials
regarding the Offer."
11. IRREGULARITIES. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance of any tender
of Shares will be determined by AEP, in its sole discretion, and its
determination shall be final and binding. AEP reserves the absolute right to
reject any and all tenders of Shares that it determines are not in proper form
or the acceptance for payment of or payment for Shares that may, in the opinion
of AEP's counsel, be unlawful. AEP also reserves the absolute right to waive any
of the conditions to the Offer or any defect or irregularity in any tender of
Shares and AEP's interpretation of the terms and conditions of the Offer
(including these instructions) shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as AEP shall determine. None of AEP, OPCo, the Dealer Managers, the
Depositary, the Information Agent or any other person shall be under any duty to
give notice of any defect or irregularity in tenders, nor shall any of them
incur any liability for failure to give any such notice. Tenders will not be
deemed to have been made until all defects and irregularities have been cured or
waived.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any of your certificate(s)
for Shares have been lost, stolen or destroyed, please call the Depositary at
1-800-649-2153. In addition, you should advise the Depositary of any
certificate(s) you have in your possession. You will need to complete an
Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by the Depositary) and pay an indemnity bond premium fee. The tender of
Shares pursuant to this Letter of Transmittal will not be valid unless prior to
the Expiration Date: (a) such procedures have been completed and a replacement
certificate for the Shares has been delivered to the Depositary or (b) a Notice
of Guaranteed Delivery has been delivered to the Depositary. See Instruction 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL, DULY EXECUTED, TOGETHER WITH, IF
APPLICABLE, CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER, AND ALL OTHER
REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR, IF APPLICABLE, THE
NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY, ON OR PRIOR TO
THE APPLICABLE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under federal income tax law, a Preferred Shareholder whose tendered Shares
are accepted for payment is required to provide the Depositary (as payer) with
either such Preferred Shareholder's correct TIN on Substitute Form W-9 below or
a properly completed Form W-8. If such Preferred Shareholder is an individual,
the TIN is his or her social security number. For businesses and other entities,
the number is the federal employer identification number. If the Depositary is
not provided with the correct TIN or properly completed Form W-8, the Preferred
Shareholder may be subject to a $50 penalty imposed by the Internal Revenue
Code. In addition, payments that are made to such Preferred Shareholder with
respect to Shares purchased pursuant to the Offer may be subject to 31% backup
withholding.
<PAGE> 19
Certain Preferred Shareholders (including, among others, all corporations
and certain foreign individuals) are exempt from backup withholding. For a
corporate United States Preferred Shareholder to qualify for such exemption,
such Preferred Shareholder must provide the Depositary with a properly completed
and executed Substitute Form W-9 attesting to its exempt status. In order for a
foreign Preferred Shareholder to qualify as an exempt recipient, such Preferred
Shareholder must submit to the Depositary a properly completed Internal Revenue
Service Form W-8 (a "Form W-8"), signed under penalties of perjury, attesting to
that Preferred Shareholder's exempt status. A Form W-8 can be obtained from the
Depositary. See the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional instructions.
If federal income tax backup withholding applies, the Depositary is
required to withhold 31% of any payments made to the Preferred Shareholder.
Backup withholding is not an additional tax. Rather, the Federal income tax
liability of persons subject to backup withholding will be reduced by the amount
of the tax withheld. If withholding results in an overpayment of taxes, a refund
may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on payments that are made to a Preferred
Shareholder with respect to Shares purchased pursuant to the Offer, the
Preferred Shareholder is required to notify the Depositary of his or her correct
TIN by completing the Substitute Form W-9 attached hereto certifying that the
TIN provided on Substitute Form W-9 is correct and that (a) the Preferred
Shareholder has not been notified by the Internal Revenue Service that he or she
is subject to federal income tax backup withholding as a result of failure to
report all interest or dividends or (b) the Internal Revenue Service has
notified the Preferred Shareholder that he or she is no longer subject to
federal income tax backup withholding. Foreign Preferred Shareholders must
submit a properly completed Form W-8 in order to avoid the applicable backup
withholding.
WHAT NUMBER TO GIVE THE DEPOSITARY
The Preferred Shareholder is required to give the Depositary the social
security number or employer identification number of the registered owner of the
Shares. If the Shares are in more than one name or are not in the name of the
actual owner, consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional guidance on which
number to report.
PAYER'S NAME: FIRST CHICAGO TRUST COMPANY OF NEW YORK
<TABLE>
-------------------------------------------------------------------------------------------------------------------------------
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<S> <C>
Part 1 -- PLEASE PROVIDE YOUR TIN IN THE Social Security Number OR
BOX AT RIGHT AND CERTIFY BY SIGNING AND Employer Identification Number
DATING BELOW. TIN ______________________________
---------------------------------------------------------------------------------------
SUBSTITUTE Name (Please Print)
Address Part 2 --
City _________ State ____ Zip Code _____ Awaiting TIN [ ]
---------------------------------------------------------------------------------------
FORM W-9 Part 3 -- CERTIFICATION -- UNDER PENALTIES OF PERJURY. I CERTIFY THAT: (1) the number
DEPARTMENT OF THE TREASURY shown on the form is my correct taxpayer identification number (or a TIN has not been
INTERNAL REVENUE SERVICE issued to me but I have mailed or delivered an application to receive a TIN or intend
to do so in the near future), (2) I am not subject to backup withholding either because
I have not been notified by the Internal Revenue Service (the "IRS") that I am subject
to backup withholding as a result of a failure to report all interest or dividends or
the IRS has notified me that I am no longer subject to backup withholding and (3) all
other information provided on this form is true, correct and complete.
SIGNATURE ____________________________________________ DATE_____________________ 1997
You must cross out item (2) above if you have been notified by the IRS that you are
currently subject to backup withholding because of underreporting interest or dividends
on your tax return.
---------------------------------------------------------------------------------------
PAYER'S REQUEST FOR TAXPAYER NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31%
IDENTIFICATION NUMBER ("TIN") OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE ENCLOSED
AND CERTIFICATION GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9
FOR ADDITIONAL DETAILS. YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE
BOX IN PART 2 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has not been
issued to me and either (1) I have mailed or delivered an application to receive a
taxpayer identification number to the appropriate Internal Revenue Service Center or
Social Security Administration Office or (2) I intend to do so in the near future. I
understand that if I do not provide a taxpayer identification number by the time of
payment, 31% of all payments of the purchase price made to me will be withheld until I
provide a number.
SIGNATURE _________________________________________ Date: _____________________ 1997.
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 20
THE DEALER MANAGERS:
<TABLE>
<S> <C>
MERRILL LYNCH & CO. SALOMON BROTHERS INC
World Financial Center Seven World Trade Center
250 Vesey Street New York, New York 10048
New York, New York 10281 Attn: Liability Management Department
(888) ML4-TNDR (toll free) (800) 558-3745 (toll free)
((888) 654-8637 (toll free))
</TABLE>
THE INFORMATION AGENT:
MORROW & CO., INC.
909 Third Avenue
New York, New York 10022-4799
(800) 566-9061 (call toll free)
(212) 754-8000
<PAGE> 21
4.20% OPCO
LETTER OF TRANSMITTAL
TO ACCOMPANY
SHARES OF 4.20% SERIES CUMULATIVE PREFERRED STOCK
CUSIP NUMBER 677415 20 0
OF
OHIO POWER COMPANY
TENDERED PURSUANT TO THE OFFER TO PURCHASE FOR CASH
BY
AMERICAN ELECTRIC POWER COMPANY, INC.
DATED JANUARY 30, 1997, FOR PURCHASE AT A
PURCHASE PRICE OF $66.46 PER SHARE
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON FRIDAY, FEBRUARY 28, 1997, UNLESS THE OFFER IS EXTENDED.
TO: FIRST CHICAGO TRUST COMPANY OF NEW YORK, DEPOSITARY
<TABLE>
<S> <C> <C>
BY MAIL: BY HAND: BY OVERNIGHT COURIER:
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
P.O. Box 2569 c/o The Depository Trust Company 14 Wall Street, 8th
Suite 4660 55 Water Street, DTC TAD Floor
Jersey City, NJ 07303-2569 Vietnam Veterans Memorial Plaza Suite 4680-OPCO
New York, NY 10041 New York, NY 10005
</TABLE>
AMERICAN ELECTRIC POWER COMPANY, INC. ("AEP") WILL NOT BE REQUIRED TO
ACCEPT FOR PAYMENT OR PAY FOR ANY SHARES TENDERED IF THE PROPOSED AMENDMENT IS
NOT APPROVED AND ADOPTED AT THE SPECIAL MEETING. PREFERRED SHAREHOLDERS OF
RECORD OF OHIO POWER COMPANY ("OPCO") HAVE THE RIGHT TO VOTE FOR OR AGAINST THE
PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES BY CASTING
THEIR VOTE AND SIGNING THE PROXY ENCLOSED HEREWITH OR BY VOTING IN PERSON AT THE
SPECIAL MEETING. IF THE PROPOSED AMENDMENT IS APPROVED AND ADOPTED BY OPCO'S
SHAREHOLDERS, OPCO WILL MAKE A SPECIAL CASH PAYMENT TO EACH PREFERRED
SHAREHOLDER WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT THEIR
SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
- --------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDERS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NOTE: IF SHARES ARE BEING TENDERED, THE REMAINDER OF THIS LETTER OF TRANSMITTAL
MUST BE COMPLETED, INCLUDING, IF APPLICABLE, THE SUBSTITUTE FORM W-9
BELOW.
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS LETTER OF
TRANSMITTAL IN THE APPROPRIATE SPACE THEREFOR PROVIDED AND, IF YOU ARE TENDERING
ANY SHARES, COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW OR A FORM W-8, AS
APPLICABLE. SEE INSTRUCTION 8 AND "IMPORTANT TAX INFORMATION" BELOW.
DO NOT SEND ANY CERTIFICATES TO MERRILL LYNCH & CO., SALOMON BROTHERS INC,
MORROW & CO., INC., AMERICAN ELECTRIC POWER COMPANY, INC. OR OHIO POWER COMPANY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED. QUESTIONS REGARDING
AND REQUESTS FOR COPIES OF THE OFFER TO PURCHASE AND PROXY STATEMENT OR THIS
LETTER OF TRANSMITTAL MAY BE DIRECTED TO MORROW & CO., INC., THE INFORMATION
AGENT, AT 909 THIRD AVENUE, NEW YORK, NEW YORK 10022-4799 OR TELEPHONE (800)
566-9061 (TOLL FREE).
<PAGE> 22
This Letter of Transmittal is to be used (a) if certificates are to be
forwarded to the First Chicago Trust Company of New York ("Depositary") or (b)
if delivery of tendered Shares (as defined below) is to be made by book-entry
transfer to the Depositary's account at The Depository Trust Company ("DTC") or
the Philadelphia Depository Trust Company ("PDTC") (hereinafter collectively
referred to as the "Book-Entry Transfer Facilities") pursuant to the procedures
set forth under the heading "Terms of the Offer -- Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement (as defined below).
Preferred Shareholders (as defined below) who wish to tender Shares but who
cannot deliver their Shares and all other documents required hereby to the
Depositary by the Expiration Date (as defined in the Offer to Purchase and Proxy
Statement) must tender their Shares pursuant to the guaranteed delivery
procedure set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. See Instruction
2. DELIVERY OF DOCUMENTS TO AEP, OPCO OR A BOOK-ENTRY TRANSFER FACILITY DOES NOT
CONSTITUTE A VALID DELIVERY.
- --------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
(IF TENDERING SHARES, PLEASE FILL IN EXACTLY AS INFORMATION APPEARS ON
CERTIFICATE(S))
(ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------
TOTAL NUMBER OF SHARES
CERTIFICATE NUMBER(S)* REPRESENTED BY CERTIFICATE(S) NUMBER OF SHARES TENDERED**
- ------------------------------------------------------------------------------------------
<S> <C> <C>
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented by
any certificates delivered to the Depositary are being tendered. See
Instruction 4.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Depositary at 1-800-649-2153. In addition, you should
advise the Depositary of any certificate(s) you have in your possession. You
will need to complete an Affidavit of Loss with respect to the lost
certificate(s) (which will be provided by the Depositary) and pay an indemnity
bond premium fee.
(BOXES BELOW FOR USE BY ELIGIBLE INSTITUTIONS ONLY)
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
TO THE DEPOSITARY'S ACCOUNT AT A BOOK-ENTRY TRANSFER FACILITY AND
COMPLETE THE FOLLOWING:
Name of tendering institution
Account No.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE
OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE
THE FOLLOWING:
Name(s) of tendering shareholder(s)
Date of execution of Notice of Guaranteed Delivery
Name of institution that guaranteed delivery
If delivery is by book-entry transfer:
Name of tendering institution
Account no.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
<PAGE> 23
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to American Electric Power Company, Inc., a
New York corporation ("AEP"), the shares in the amount set forth in the box
above designated "Description of Shares Tendered" pursuant to AEP's offer to
purchase any and all of the outstanding shares of the series of cumulative
preferred stock of Ohio Power Company, an Ohio corporation, and direct utility
subsidiary of AEP ("OPCo"), shown on the first page hereof as to which this
Letter of Transmittal is applicable (the "Shares") at the purchase price per
Share shown on the first page hereof plus accrued and unpaid dividends thereon,
net to the seller in cash, upon the terms and subject to the conditions set
forth in the Offer to Purchase and Proxy Statement, dated January 30, 1997 (the
"Offer to Purchase and Proxy Statement"), receipt of which is hereby
acknowledged, and in this Letter of Transmittal (which as to the Shares,
together with the Offer to Purchase and Proxy Statement, constitutes the
"Offer"). WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT
TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S AMENDED
ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND PROXY
STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE PROPOSED
AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED IN THE
OFFER TO PURCHASE AND PROXY STATEMENT). See "Proposed Amendment and Proxy
Solicitation", "Terms of the Offer -- Extension of Tender Period; Termination;
Amendments" and "Terms of the Offer -- Certain Conditions of the Offer" in the
Offer to Purchase and Proxy Statement.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the undersigned hereby
sells, assigns and transfers to, or upon the order of, AEP all right, title and
interest in and to all the Shares that are being tendered hereby and hereby
constitutes and appoints First Chicago Trust Company of New York (the
"Depositary") the true and lawful agent and attorney-in-fact of the undersigned
with respect to such Shares, with full power of substitution (such power of
attorney being an irrevocable power coupled with an interest), to (a) deliver
certificates for such Shares, or transfer ownership of such Shares on the
account books maintained by the Book-Entry Transfer Facility that holds such
Shares, together, in any such case, with all accompanying evidences of transfer
and authenticity, to or upon the order of AEP, (b) present such Shares for
registration and transfer on the books of OPCo and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, all in
accordance with the terms of the Offer. The Depositary will act as agent for
tendering stockholders for the purpose of receiving payment from AEP and
transmitting payment to tendering stockholders.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Shares
tendered hereby and that, when and to the extent the same are accepted for
payment by AEP, AEP will acquire good, marketable and unencumbered title
thereto, free and clear of all liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the same will not be subject to any adverse claims. The
undersigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or AEP to be necessary or desirable to complete the
sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by, and shall survive the death, bankruptcy or incapacity of the
undersigned, and any obligations of the undersigned hereunder shall be binding
upon the heirs, legal representatives, successors, assigns, executors and
administrators of the undersigned. Except as stated in the Offer, this tender is
irrevocable.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and in the
instructions hereto will constitute the undersigned's acceptance of the terms
and conditions of the Offer, including the undersigned's representation and
warranty that (a) the undersigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (b) the tender of such Shares complies
with such Rule 14e-4. AEP's acceptance for payment of Shares tendered pursuant
to the Offer will constitute a binding agreement between the undersigned and AEP
upon the terms and subject to the conditions of the Offer.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase and Proxy Statement, AEP may terminate or amend the Offer
or may not be required to purchase any of the Shares tendered hereby. In either
event, the undersigned understands that certificate(s) for any Shares not
tendered or not purchased will be returned to the undersigned.
<PAGE> 24
Unless otherwise indicated in the box below under the heading "Special
Payment Instructions", please issue the check for the purchase price of any
Shares purchased, and/or return any Shares not tendered or not purchased, in the
name(s) of the undersigned (and, in the case of Shares tendered by book-entry
transfer, by credit to the account at the Book-Entry Transfer Facility
designated above). Similarly, unless otherwise indicated in the box below under
the heading "Special Delivery Instructions", please mail the check for the
purchase price of any Shares purchased and/or any certificates for Shares not
tendered or not purchased (and accompanying documents, as appropriate) to the
undersigned at the address shown below the undersigned signature(s). In the
event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any Shares purchased and/or return any Shares not tendered or not purchased in
the name(s) of, and mail said check and/or any certificates to, the person(s) so
indicated. The undersigned recognizes that AEP has no obligation, pursuant to
the "Special Payment Instructions", to transfer any Shares from the name of the
registered holder(s) thereof if AEP does not accept for payment any of the
Shares so tendered.
----------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 5 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be issued in the name of someone other than the undersigned.
Issue: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
---------------------------------------------------------
---------------------------------------------------------
(INCLUDE ZIP CODE)
----------------------------------------------------------------
(TAXPAYER IDENTIFICATION OR
SOCIAL SECURITY NUMBER)
----------------------------------------------------------------
----------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 4 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be mailed to someone other than the undersigned or to the undersigned
at an address other than that shown below the undersigned's signature(s).
Mail: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
---------------------------------------------------------
---------------------------------------------------------
(INCLUDE ZIP CODE)
----------------------------------------------------------------
----------------------------------------------------------------
SIGNATURE(S) OF OWNER(S)
X
- --------------------------------------------------------------------------------
X
- --------------------------------------------------------------------------------
Dated: , 1997
Name(s):
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title):
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.:
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on the
stock certificate(s) or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in a
fiduciary or representative capacity, please set forth full title and see
Instruction 5.)
<PAGE> 25
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5)
Authorized Signature:
Name:
Name of Firm:
Address of Firm:
Area Code and Telephone No.:
Dated: , 1997
IF SHARES ARE BEING TENDERED, PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW OR
A FORM W-8, AS APPLICABLE.
SOLICITED TENDERS
(SEE INSTRUCTION 10)
As provided in Instruction 10, AEP will pay to any Soliciting Dealer, as
defined in Instruction 10, a solicitation fee of $1.50 per Share (except that
for transactions for beneficial owners equal to or exceeding 5,000 Shares, AEP
will pay a solicitation fee of $1.00 per Share) for any Shares tendered,
accepted for payment and paid pursuant to the Offer. However, Soliciting Dealers
will not be entitled to a solicitation fee for Shares beneficially owned by such
Soliciting Dealer.
The abovesigned represents that the Soliciting Dealer which solicited and
obtained this tender is:
Name of Firm:
(PLEASE PRINT)
Name of Individual Broker
or Financial Consultant:
Telephone Number of Broker
or Financial Consultant:
Identification Number (if known):
Address:
(INCLUDE ZIP CODE)
The following to be completed ONLY if customer's Shares held in nominee
name are tendered.
<TABLE>
<CAPTION>
NAME OF BENEFICIAL OWNER NUMBER OF SHARES TENDERED
(ATTACH ADDITIONAL LIST IF NECESSARY)
<S> <C>
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
</TABLE>
The acceptance of compensation by such Soliciting Dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase and Proxy Statement; (c) in soliciting tenders of Shares, it
has used no solicitation materials other than those furnished by AEP; and (d) if
it is a foreign broker or dealer not eligible for membership in the National
Association of Securities Dealers, Inc. (the "NASD"), it has agreed to conform
to the NASD's Rules of Fair Practice in making solicitations.
The payment of compensation to any Soliciting Dealer is dependent on such
Soliciting Dealer returning a Notice of Solicited Tenders to the Depositary.
THIS LETTER OF TRANSMITTAL IS TO BE USED FOR THE TENDER OF SHARES OF THE
4.20% SERIES (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT) ONLY. ANY
PERSON DESIRING TO TENDER SHARES OF ANY OTHER SERIES OF CUMULATIVE PREFERRED
STOCK FOR WHICH AEP IS MAKING A TENDER OFFER MUST SUBMIT A LETTER OF TRANSMITTAL
RELATING TO THAT SPECIFIC SERIES.
<PAGE> 26
INSTRUCTIONS
FORMING PART OF THE
TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a firm that is a
member of a registered national securities exchange or the National Association
of Securities Dealers, Inc., or by a commercial bank or trust company having an
office or correspondent in the United States which is a participant in an
approved Medallion Signature Guarantee Program (each of the foregoing being
referred to as an "Eligible Institution"). Signatures on this Letter of
Transmittal need not be guaranteed (a) if this Letter of Transmittal is signed
by the registered holder(s) of the Shares (which term, for purposes of this
document, shall include any participant in one of the Book-Entry Transfer
Facilities whose name appears on a security position listing as the owner of
Shares) tendered herewith and such holder(s) has not completed the box above
under the heading "Special Payment Instructions" or the box above under the
heading "Special Delivery Instructions" on this Letter of Transmittal, or (b) if
such Shares are tendered for the account of an Eligible Institution. See
Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND SHARES. This Letter of
Transmittal is to be used if (a) certificates are to be forwarded herewith or,
(b) delivery of Shares is to be made by book-entry transfer pursuant to the
procedures set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. Certificates for
all physically delivered Shares, or a confirmation of a book-entry transfer into
the Depositary's account at one of the Book-Entry Transfer Facilities of all
Shares delivered electronically, as well as a properly completed and duly
executed Letter of Transmittal, and any other documents required by this Letter
of Transmittal, must be received by the Depositary at one of its addresses set
forth on the front page of this Letter of Transmittal on or prior to the
Expiration Date (as defined in the Offer to Purchase and Proxy Statement) with
respect to all Shares. Preferred Shareholders who wish to tender their Shares
yet who cannot deliver their Shares and all other required documents to the
Depositary on or prior to the Expiration Date must tender their Shares pursuant
to the guaranteed delivery procedure set forth under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement. Pursuant to such procedure: (a) such tender must be made by or
through an Eligible Institution, (b) a properly completed and duly executed
Notice of Guaranteed Delivery in the form provided by AEP (with any required
signature guarantees) must be received by the Depositary on or prior to the
applicable Expiration Date and (c) the certificates for all physically delivered
Shares, or a confirmation of a book-entry transfer into the Depositary's account
at one of the Book-Entry Transfer Facilities of all Shares delivered
electronically, together with a properly completed and duly executed Letter of
Transmittal and any other documents required by this Letter of Transmittal must
be received by the Depositary by 5:00 p.m. (New York City time) within three New
York Stock Exchange trading days after the date of execution of such Notice of
Guaranteed Delivery, all as provided under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF CERTIFICATES FOR
SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY
INSURED, IS RECOMMENDED.
No alternative, conditional or contingent tenders will be accepted. See
"Terms of the Offer -- Number of Shares; Purchase Prices; Expiration Date;
Dividends" in the Offer to Purchase and Proxy Statement. By executing this
Letter of Transmittal, the tendering stockholder waives any right to receive any
notice of the acceptance for payment of the Shares.
3. VOTING. WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES
PURSUANT TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S
AMENDED ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND
PROXY STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE
PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED
IN THE OFFER TO PURCHASE AND PROXY STATEMENT). In addition, Preferred
Shareholders have the right to vote for or against the Proposed Amendment
regardless of whether they tender their Shares by casting their vote and duly
executing the proxy enclosed herewith or by voting in person at the Special
Meeting. By executing a Notice of Guaranteed Delivery, a Preferred Shareholder
is deemed to have tendered the Shares described in such Notice of Guaranteed
Delivery and to have voted such Shares in accordance with the proxy returned
therewith, if any. If no vote is indicated on an otherwise properly executed
proxy, then all Shares in respect of such proxy will be voted in favor of the
Proposed Amendment. See "Proposed Amendment and Proxy Solicitation" in the Offer
to Purchase and Proxy Statement. The Offer is being sent to all persons in whose
names Shares are registered on the books of OPCo on the Record Date (as defined
in the Offer to Purchase and Proxy Statement) and transferees thereof. Only a
record holder of Shares on the Record Date may vote in person or by proxy at the
Special Meeting. No record date is fixed for determining which persons are
permitted to tender Shares. Any person who is the beneficial owner but not the
record holder of Shares must arrange for the record transfer of such Shares
prior to tendering.
4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the Shares represented by any
certificate delivered to the Depositary are to be tendered, fill in the number
of Shares that are to be tendered in the box above under the heading
"Description of Shares Tendered". In such case, a new certificate for the
remainder of the Shares represented by the old certificate will be sent to the
person(s) signing this Letter of Transmittal, unless otherwise provided in the
box above under the heading "Special Payment Instructions" or "Special Delivery
Instructions", as promptly as practicable following the expiration or
termination of the Offer. All Shares represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise indicated.
<PAGE> 27
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL AND/OR NOTICE OF GUARANTEED
DELIVERY; STOCK POWERS AND ENDORSEMENTS. If either this Letter of Transmittal
or the Notice of Guaranteed Delivery (together, the "Tender Documents") is
signed by the registered holder(s) of the Shares tendered hereby, the
signature(s) must correspond with the name(s) as written on the face of the
certificates without alteration, enlargement or any change whatsoever.
If any of the Shares tendered under either Tender Document is held of
record by two or more persons, all such persons must sign such Tender Document.
If any of the Shares tendered under either Tender Document is registered in
different names or different certificates, it will be necessary to complete,
sign and submit as many separate applicable Tender Documents as there are
different registrations or certificates.
If either Tender Document is signed by the registered holder(s) of the
Shares tendered hereby, no endorsements of certificates or separate stock powers
are required unless payment of the purchase price is to be made to, or Shares
not tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s). Signatures on any such certificates or
stock powers must be guaranteed by an Eligible Institution. See Instruction 1.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates must be
endorsed or accompanied by appropriate stock powers, in either case, signed
exactly as the name(s) of the registered holder(s) appear(s) on the certificates
for such Shares. Signature(s) on any such certificates or stock powers must be
guaranteed by an Eligible Institution. See Instruction 1.
If either Tender Document or any certificate or stock power is signed by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
AEP of the authority of such person so to act must be submitted.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, AEP
will pay or cause to be paid any stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price is to be made to, or Shares not tendered
or not purchased are to be registered in the name of, any person other than the
registered holder(s), or if tendered Shares are registered in the name of any
person other than the person(s) signing this Letter of Transmittal, the amount
of any stock transfer taxes (whether imposed on the registered holder(s), such
other person or otherwise) payable on account of the transfer to such person
will be deducted from the purchase price unless satisfactory evidence of the
payment of such taxes, or exemption therefrom, is submitted. See "Terms of the
Offer -- Acceptance of Shares for Payment and Payment of Purchase Price and
Dividends" in the Offer to Purchase and Proxy Statement. EXCEPT AS PROVIDED IN
THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE
CERTIFICATES REPRESENTING SHARES TENDERED HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any Shares purchased is to be issued in the name of, and/or
any Shares not tendered or not purchased are to be returned to, a person other
than the person(s) signing this Letter of Transmittal or if the check and/or any
certificate for Shares not tendered or not purchased are to be mailed to someone
other than the person(s) signing this Letter of Transmittal or to an address
other than that shown in the box above under the heading "Name(s) and
Address(es) of Registered Holder(s)", then the "Special Payment Instructions"
and/or "Special Delivery Instructions" on this Letter of Transmittal should be
completed. Preferred Shareholders tendering Shares by book-entry transfer will
have any Shares not accepted for payment returned by crediting the account
maintained by such Preferred Shareholder at the Book-Entry Transfer Facility
from which such transfer was made.
8. SUBSTITUTE FORM W-9 AND FORM W-8. The tendering Preferred Shareholder
is required to provide the Depositary with either a correct Taxpayer
Identification Number ("TIN") on Substitute Form W-9, which is provided under
"Important Tax Information" below, or a properly completed Form W-8. Failure to
provide the information on either Substitute Form W-9 or Form W-8 may subject
the tendering Preferred Shareholder to a $50 penalty imposed by the Internal
Revenue Service and to 31% federal income tax backup withholding on the payment
of the purchase price for the Shares. The box in Part 2 of Substitute Form W-9
may be checked if the tendering Preferred Shareholder has not been issued a TIN
and has applied for a number or intends to apply for a number in the near
future. If the box in Part 2 is checked and the Depositary is not provided with
a TIN by the time of payment, the Depositary will withhold 31% on all payments
of the purchase price for the Shares thereafter until a TIN is provided to the
Depositary.
9. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Any questions or
requests for assistance may be directed to the Information Agent or the Dealer
Managers at their respective telephone numbers and addresses listed below.
Requests for additional copies of the Offer to Purchase and Proxy Statement,
this Letter of Transmittal or other tender offer materials may be directed to
the Information Agent and such copies will be furnished promptly at AEP's
expense. Preferred Shareholders may also contact their local broker, dealer,
commercial bank or trust company for assistance concerning the Offer.
<PAGE> 28
10. SOLICITED TENDERS. AEP will pay a solicitation fee of $1.50 per Share
(except that for transactions for beneficial owners tendering more than 5,000
Shares, AEP will pay a solicitation fee of $1.00 per Share) for any Shares
tendered, accepted for payment and paid pursuant to the Offer, covered by the
Letter of Transmittal which designates, under the heading "Solicited Tenders",
as having solicited and obtained the tender, the name of (a) any broker or
dealer in securities, including a Dealer Manager in its capacity as a dealer or
broker, which is a member of any national securities exchange or of the National
Association of Securities Dealers, Inc. (the "NASD"), (b) any foreign broker or
dealer not eligible for membership in the NASD which agrees to conform to the
NASD's Rules of Fair Practice in soliciting tenders outside the United States to
the same extent as though it were an NASD member, or (c) any bank or trust
company (each of which is referred to herein as a "Soliciting Dealer"). No such
fee shall be payable to a Soliciting Dealer with respect to the tender of Shares
by a holder unless the Letter of Transmittal accompanying such tender designates
such Soliciting Dealer. No such fee shall be payable to a Soliciting Dealer in
respect of Shares registered in the name of such Soliciting Dealer unless such
Shares are held by such Soliciting Dealer as nominee and such Shares are being
tendered for the benefit of one or more beneficial owners identified on the
Letter of Transmittal or on the Notice of Solicited Tenders (included in the
materials provided to brokers and dealers). No such fee shall be payable to a
Soliciting Dealer with respect to the tender of Shares by the holder of record,
for the benefit of the beneficial owner, unless the beneficial owner has
designated such Soliciting Dealer. If tendered Shares are being delivered by
book-entry transfer, the Soliciting Dealer must return a Notice of Solicited
Tenders to the Depositary within three business days after expiration of the
Offer to receive a solicitation fee. No such fee shall be payable to a
Soliciting Dealer if such Soliciting Dealer is required for any reason to
transfer the amount of such fee to a depositing holder (other than itself). No
such fee shall be paid to a Soliciting Dealer with respect to Shares tendered
for such Soliciting Dealer's own account. No broker, dealer, bank, trust company
or fiduciary shall be deemed to be the agent of AEP, the Depositary, the
Information Agent or the Dealer Managers for purposes of the Offer.
Soliciting Dealers will include any organizations described in clauses (a),
(b) or (c) above even when the activities of such organization in connection
with the Offer consist solely of forwarding to clients materials relating to the
Offer, including this Letter of Transmittal, and rendering Shares as directed by
beneficial owners thereof. No Soliciting Dealer is required to make any
recommendation to holders of Shares as to whether to tender or refrain from
tendering in the Offer. No assumption is made, in making payment to any
Soliciting Dealer, that its activities in connection with the Offer included any
activities other than those described above, and for all purposes noted in all
materials relating to the Offer, the term "solicit" shall be deemed to mean no
more than "processing shares tendered" or "forwarding to customers materials
regarding the Offer."
11. IRREGULARITIES. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance of any tender
of Shares will be determined by AEP, in its sole discretion, and its
determination shall be final and binding. AEP reserves the absolute right to
reject any and all tenders of Shares that it determines are not in proper form
or the acceptance for payment of or payment for Shares that may, in the opinion
of AEP's counsel, be unlawful. AEP also reserves the absolute right to waive any
of the conditions to the Offer or any defect or irregularity in any tender of
Shares and AEP's interpretation of the terms and conditions of the Offer
(including these instructions) shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as AEP shall determine. None of AEP, OPCo, the Dealer Managers, the
Depositary, the Information Agent or any other person shall be under any duty to
give notice of any defect or irregularity in tenders, nor shall any of them
incur any liability for failure to give any such notice. Tenders will not be
deemed to have been made until all defects and irregularities have been cured or
waived.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any of your certificate(s)
for Shares have been lost, stolen or destroyed, please call the Depositary at
1-800-649-2153. In addition, you should advise the Depositary of any
certificate(s) you have in your possession. You will need to complete an
Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by the Depositary) and pay an indemnity bond premium fee. The tender of
Shares pursuant to this Letter of Transmittal will not be valid unless prior to
the Expiration Date: (a) such procedures have been completed and a replacement
certificate for the Shares has been delivered to the Depositary or (b) a Notice
of Guaranteed Delivery has been delivered to the Depositary. See Instruction 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL, DULY EXECUTED, TOGETHER WITH, IF
APPLICABLE, CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER, AND ALL OTHER
REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR, IF APPLICABLE, THE
NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY, ON OR PRIOR TO
THE APPLICABLE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under federal income tax law, a Preferred Shareholder whose tendered Shares
are accepted for payment is required to provide the Depositary (as payer) with
either such Preferred Shareholder's correct TIN on Substitute Form W-9 below or
a properly completed Form W-8. If such Preferred Shareholder is an individual,
the TIN is his or her social security number. For businesses and other entities,
the number is the federal employer identification number. If the Depositary is
not provided with the correct TIN or properly completed Form W-8, the Preferred
Shareholder may be subject to a $50 penalty imposed by the Internal Revenue
Code. In addition, payments that are made to such Preferred Shareholder with
respect to Shares purchased pursuant to the Offer may be subject to 31% backup
withholding.
<PAGE> 29
Certain Preferred Shareholders (including, among others, all corporations
and certain foreign individuals) are exempt from backup withholding. For a
corporate United States Preferred Shareholder to qualify for such exemption,
such Preferred Shareholder must provide the Depositary with a properly completed
and executed Substitute Form W-9 attesting to its exempt status. In order for a
foreign Preferred Shareholder to qualify as an exempt recipient, such Preferred
Shareholder must submit to the Depositary a properly completed Internal Revenue
Service Form W-8 (a "Form W-8"), signed under penalties of perjury, attesting to
that Preferred Shareholder's exempt status. A Form W-8 can be obtained from the
Depositary. See the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional instructions.
If federal income tax backup withholding applies, the Depositary is
required to withhold 31% of any payments made to the Preferred Shareholder.
Backup withholding is not an additional tax. Rather, the Federal income tax
liability of persons subject to backup withholding will be reduced by the amount
of the tax withheld. If withholding results in an overpayment of taxes, a refund
may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on payments that are made to a Preferred
Shareholder with respect to Shares purchased pursuant to the Offer, the
Preferred Shareholder is required to notify the Depositary of his or her correct
TIN by completing the Substitute Form W-9 attached hereto certifying that the
TIN provided on Substitute Form W-9 is correct and that (a) the Preferred
Shareholder has not been notified by the Internal Revenue Service that he or she
is subject to federal income tax backup withholding as a result of failure to
report all interest or dividends or (b) the Internal Revenue Service has
notified the Preferred Shareholder that he or she is no longer subject to
federal income tax backup withholding. Foreign Preferred Shareholders must
submit a properly completed Form W-8 in order to avoid the applicable backup
withholding.
WHAT NUMBER TO GIVE THE DEPOSITARY
The Preferred Shareholder is required to give the Depositary the social
security number or employer identification number of the registered owner of the
Shares. If the Shares are in more than one name or are not in the name of the
actual owner, consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional guidance on which
number to report.
PAYER'S NAME: FIRST CHICAGO TRUST COMPANY OF NEW YORK
<TABLE>
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Part 1 -- PLEASE PROVIDE YOUR TIN IN THE Social Security Number OR
BOX AT RIGHT AND CERTIFY BY SIGNING AND Employer Identification Number
DATING BELOW. TIN ______________________________
---------------------------------------------------------------------------------------
SUBSTITUTE Name (Please Print) ____________________
Address ________________________________ Part 2 --
City _________ State ____ Zip Code _____ Awaiting TIN [ ]
---------------------------------------------------------------------------------------
FORM W-9 Part 3 -- CERTIFICATION -- UNDER PENALTIES OF PERJURY. I CERTIFY THAT: (1) the number
DEPARTMENT OF THE TREASURY shown on the form is my correct taxpayer identification number (or a TIN has not been
INTERNAL REVENUE SERVICE issued to me but I have mailed or delivered an application to receive a TIN or intend
to do so in the near future), (2) I am not subject to backup withholding either because
I have not been notified by the Internal Revenue Service (the "IRS") that I am subject
to backup withholding as a result of a failure to report all interest or dividends or
the IRS has notified me that I am no longer subject to backup withholding and (3) all
other information provided on this form is true, correct and complete.
SIGNATURE _____________________________________________ DATE_____________________ 1997
You must cross out item (2) above if you have been notified by the IRS that you are
currently subject to backup withholding because of underreporting interest or dividends
on your tax return.
---------------------------------------------------------------------------------------
PAYER'S REQUEST FOR TAXPAYER NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31%
IDENTIFICATION NUMBER ("TIN") OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE ENCLOSED
AND CERTIFICATION GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9
FOR ADDITIONAL DETAILS. YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE
BOX IN PART 2 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has not been
issued to me and either (1) I have mailed or delivered an application to receive a
taxpayer identification number to the appropriate Internal Revenue Service Center or
Social Security Administration Office or (2) I intend to do so in the near future. I
understand that if I do not provide a taxpayer identification number by the time of
payment, 31% of all payments of the purchase price made to me will be withheld until I
provide a number.
SIGNATURE __________________________________________ Date: _____________________ 1997.
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 30
THE DEALER MANAGERS:
<TABLE>
<S> <C>
MERRILL LYNCH & CO. SALOMON BROTHERS INC
World Financial Center Seven World Trade Center
250 Vesey Street New York, New York 10048
New York, New York 10281 Attn: Liability Management Department
(888) ML4-TNDR (toll free) (800) 558-3745 (toll free)
((888) 654-8637 (toll free))
</TABLE>
THE INFORMATION AGENT:
MORROW & CO., INC.
909 Third Avenue
New York, New York 10022-4799
(800) 566-9061 (call toll free)
(212) 754-8000
<PAGE> 31
4.40% OPCO
LETTER OF TRANSMITTAL
TO ACCOMPANY
SHARES OF 4.40% SERIES CUMULATIVE PREFERRED STOCK
CUSIP NUMBER 677415 30 9
OF
OHIO POWER COMPANY
TENDERED PURSUANT TO THE OFFER TO PURCHASE FOR CASH
BY
AMERICAN ELECTRIC POWER COMPANY, INC.
DATED JANUARY 30, 1997, FOR PURCHASE AT A
PURCHASE PRICE OF $69.62 PER SHARE
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON FRIDAY, FEBRUARY 28, 1997, UNLESS THE OFFER IS EXTENDED.
TO: FIRST CHICAGO TRUST COMPANY OF NEW YORK, DEPOSITARY
<TABLE>
<S> <C> <C>
BY MAIL: BY HAND: BY OVERNIGHT COURIER:
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
P.O. Box 2569 c/o The Depository Trust Company 14 Wall Street, 8th
Suite 4660 55 Water Street, DTC TAD Floor
Jersey City, NJ 07303-2569 Vietnam Veterans Memorial Plaza Suite 4680-0PCO
New York, NY 10041 New York, NY 10005
</TABLE>
AMERICAN ELECTRIC POWER COMPANY, INC. ("AEP") WILL NOT BE REQUIRED TO
ACCEPT FOR PAYMENT OR PAY FOR ANY SHARES TENDERED IF THE PROPOSED AMENDMENT IS
NOT APPROVED AND ADOPTED AT THE SPECIAL MEETING. PREFERRED SHAREHOLDERS OF
RECORD OF OHIO POWER COMPANY ("OPCO") HAVE THE RIGHT TO VOTE FOR OR AGAINST THE
PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES BY CASTING
THEIR VOTE AND SIGNING THE PROXY ENCLOSED HEREWITH OR BY VOTING IN PERSON AT THE
SPECIAL MEETING. IF THE PROPOSED AMENDMENT IS APPROVED AND ADOPTED BY OPCO'S
SHAREHOLDERS, OPCO WILL MAKE A SPECIAL CASH PAYMENT TO EACH PREFERRED
SHAREHOLDER WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT THEIR
SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
- --------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDERS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NOTE: IF SHARES ARE BEING TENDERED, THE REMAINDER OF THIS LETTER OF TRANSMITTAL
MUST BE COMPLETED, INCLUDING, IF APPLICABLE, THE SUBSTITUTE FORM W-9
BELOW.
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS LETTER OF
TRANSMITTAL IN THE APPROPRIATE SPACE THEREFOR PROVIDED AND, IF YOU ARE TENDERING
ANY SHARES, COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW OR A FORM W-8, AS
APPLICABLE. SEE INSTRUCTION 8 AND "IMPORTANT TAX INFORMATION" BELOW.
DO NOT SEND ANY CERTIFICATES TO MERRILL LYNCH & CO., SALOMON BROTHERS INC,
MORROW & CO., INC., AMERICAN ELECTRIC POWER COMPANY, INC. OR OHIO POWER COMPANY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED. QUESTIONS REGARDING
AND REQUESTS FOR COPIES OF THE OFFER TO PURCHASE AND PROXY STATEMENT OR THIS
LETTER OF TRANSMITTAL MAY BE DIRECTED TO MORROW & CO., INC., THE INFORMATION
AGENT, AT 909 THIRD AVENUE, NEW YORK, NEW YORK 10022-4799 OR TELEPHONE (800)
566-9061 (TOLL FREE).
<PAGE> 32
This Letter of Transmittal is to be used (a) if certificates are to be
forwarded to the First Chicago Trust Company of New York ("Depositary") or (b)
if delivery of tendered Shares (as defined below) is to be made by book-entry
transfer to the Depositary's account at The Depository Trust Company ("DTC") or
the Philadelphia Depository Trust Company ("PDTC") (hereinafter collectively
referred to as the "Book-Entry Transfer Facilities") pursuant to the procedures
set forth under the heading "Terms of the Offer -- Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement (as defined below).
Preferred Shareholders (as defined below) who wish to tender Shares but who
cannot deliver their Shares and all other documents required hereby to the
Depositary by the Expiration Date (as defined in the Offer to Purchase and Proxy
Statement) must tender their Shares pursuant to the guaranteed delivery
procedure set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. See Instruction
2. DELIVERY OF DOCUMENTS TO AEP, OPCO OR A BOOK-ENTRY TRANSFER FACILITY DOES NOT
CONSTITUTE A VALID DELIVERY.
- --------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
(IF TENDERING SHARES, PLEASE FILL IN EXACTLY AS INFORMATION APPEARS ON
CERTIFICATE(S))
(ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------
TOTAL NUMBER OF SHARES
CERTIFICATE NUMBER(S)* REPRESENTED BY CERTIFICATE(S) NUMBER OF SHARES TENDERED**
- ------------------------------------------------------------------------------------------
<S> <C> <C>
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented by
any certificates delivered to the Depositary are being tendered. See
Instruction 4.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Depositary at 1-800-649-2153. In addition, you should
advise the Depositary of any certificate(s) you have in your possession. You
will need to complete an Affidavit of Loss with respect to the lost
certificate(s) (which will be provided by the Depositary) and pay an indemnity
bond premium fee.
(BOXES BELOW FOR USE BY ELIGIBLE INSTITUTIONS ONLY)
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
TO THE DEPOSITARY'S ACCOUNT AT A BOOK-ENTRY TRANSFER FACILITY AND
COMPLETE THE FOLLOWING:
Name of tendering institution
Account No.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE
OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE
THE FOLLOWING:
Name(s) of tendering shareholder(s)
Date of execution of Notice of Guaranteed Delivery
Name of institution that guaranteed delivery
If delivery is by book-entry transfer:
Name of tendering institution
Account no.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
<PAGE> 33
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to American Electric Power Company, Inc., a
New York corporation ("AEP"), the shares in the amount set forth in the box
above designated "Description of Shares Tendered" pursuant to AEP's offer to
purchase any and all of the outstanding shares of the series of cumulative
preferred stock of Ohio Power Company, an Ohio corporation, and direct utility
subsidiary of AEP ("OPCo"), shown on the first page hereof as to which this
Letter of Transmittal is applicable (the "Shares") at the purchase price per
Share shown on the first page hereof plus accrued and unpaid dividends thereon,
net to the seller in cash, upon the terms and subject to the conditions set
forth in the Offer to Purchase and Proxy Statement, dated January 30, 1997 (the
"Offer to Purchase and Proxy Statement"), receipt of which is hereby
acknowledged, and in this Letter of Transmittal (which as to the Shares,
together with the Offer to Purchase and Proxy Statement, constitutes the
"Offer"). WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT
TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S AMENDED
ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND PROXY
STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE PROPOSED
AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED IN THE
OFFER TO PURCHASE AND PROXY STATEMENT). See "Proposed Amendment and Proxy
Solicitation", "Terms of the Offer -- Extension of Tender Period; Termination;
Amendments" and "Terms of the Offer -- Certain Conditions of the Offer" in the
Offer to Purchase and Proxy Statement.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the undersigned hereby
sells, assigns and transfers to, or upon the order of, AEP all right, title and
interest in and to all the Shares that are being tendered hereby and hereby
constitutes and appoints First Chicago Trust Company of New York (the
"Depositary") the true and lawful agent and attorney-in-fact of the undersigned
with respect to such Shares, with full power of substitution (such power of
attorney being an irrevocable power coupled with an interest), to (a) deliver
certificates for such Shares, or transfer ownership of such Shares on the
account books maintained by the Book-Entry Transfer Facility that holds such
Shares, together, in any such case, with all accompanying evidences of transfer
and authenticity, to or upon the order of AEP, (b) present such Shares for
registration and transfer on the books of OPCo and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, all in
accordance with the terms of the Offer. The Depositary will act as agent for
tendering stockholders for the purpose of receiving payment from AEP and
transmitting payment to tendering stockholders.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Shares
tendered hereby and that, when and to the extent the same are accepted for
payment by AEP, AEP will acquire good, marketable and unencumbered title
thereto, free and clear of all liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the same will not be subject to any adverse claims. The
undersigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or AEP to be necessary or desirable to complete the
sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by, and shall survive the death, bankruptcy or incapacity of the
undersigned, and any obligations of the undersigned hereunder shall be binding
upon the heirs, legal representatives, successors, assigns, executors and
administrators of the undersigned. Except as stated in the Offer, this tender is
irrevocable.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and in the
instructions hereto will constitute the undersigned's acceptance of the terms
and conditions of the Offer, including the undersigned's representation and
warranty that (a) the undersigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (b) the tender of such Shares complies
with such Rule 14e-4. AEP's acceptance for payment of Shares tendered pursuant
to the Offer will constitute a binding agreement between the undersigned and AEP
upon the terms and subject to the conditions of the Offer.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase and Proxy Statement, AEP may terminate or amend the Offer
or may not be required to purchase any of the Shares tendered hereby. In either
event, the undersigned understands that certificate(s) for any Shares not
tendered or not purchased will be returned to the undersigned.
<PAGE> 34
Unless otherwise indicated in the box below under the heading "Special
Payment Instructions", please issue the check for the purchase price of any
Shares purchased, and/or return any Shares not tendered or not purchased, in the
name(s) of the undersigned (and, in the case of Shares tendered by book-entry
transfer, by credit to the account at the Book-Entry Transfer Facility
designated above). Similarly, unless otherwise indicated in the box below under
the heading "Special Delivery Instructions", please mail the check for the
purchase price of any Shares purchased and/or any certificates for Shares not
tendered or not purchased (and accompanying documents, as appropriate) to the
undersigned at the address shown below the undersigned signature(s). In the
event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any Shares purchased and/or return any Shares not tendered or not purchased in
the name(s) of, and mail said check and/or any certificates to, the person(s) so
indicated. The undersigned recognizes that AEP has no obligation, pursuant to
the "Special Payment Instructions", to transfer any Shares from the name of the
registered holder(s) thereof if AEP does not accept for payment any of the
Shares so tendered.
----------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 5 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be issued in the name of someone other than the undersigned.
Issue: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
---------------------------------------------------------
---------------------------------------------------------
(INCLUDE ZIP CODE)
----------------------------------------------------------------
(TAXPAYER IDENTIFICATION OR
SOCIAL SECURITY NUMBER)
----------------------------------------------------------------
----------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 4 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be mailed to someone other than the undersigned or to the undersigned
at an address other than that shown below the undersigned's signature(s).
Mail: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
---------------------------------------------------------
---------------------------------------------------------
(INCLUDE ZIP CODE)
----------------------------------------------------------------
----------------------------------------------------------------
SIGNATURE(S) OF OWNER(S)
X
- --------------------------------------------------------------------------------
X
- --------------------------------------------------------------------------------
Dated: , 1997
Name(s):
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title):
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.:
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on the
stock certificate(s) or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in a
fiduciary or representative capacity, please set forth full title and see
Instruction 5.)
<PAGE> 35
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5)
Authorized Signature:
Name:
Name of Firm:
Address of Firm:
Area Code and Telephone No.:
Dated: , 1997
IF SHARES ARE BEING TENDERED, PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW OR
A FORM W-8, AS APPLICABLE.
SOLICITED TENDERS
(SEE INSTRUCTION 10)
As provided in Instruction 10, AEP will pay to any Soliciting Dealer, as
defined in Instruction 10, a solicitation fee of $1.50 per Share (except that
for transactions for beneficial owners equal to or exceeding 5,000 Shares, AEP
will pay a solicitation fee of $1.00 per Share) for any Shares tendered,
accepted for payment and paid pursuant to the Offer. However, Soliciting Dealers
will not be entitled to a solicitation fee for Shares beneficially owned by such
Soliciting Dealer.
The abovesigned represents that the Soliciting Dealer which solicited and
obtained this tender is:
Name of Firm:
(PLEASE PRINT)
Name of Individual Broker
or Financial Consultant:
Telephone Number of Broker
or Financial Consultant:
Identification Number (if known):
Address:
(INCLUDE ZIP CODE)
The following to be completed ONLY if customer's Shares held in nominee
name are tendered.
<TABLE>
<CAPTION>
NAME OF BENEFICIAL OWNER NUMBER OF SHARES TENDERED
(ATTACH ADDITIONAL LIST IF NECESSARY)
<S> <C>
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
</TABLE>
The acceptance of compensation by such Soliciting Dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase and Proxy Statement; (c) in soliciting tenders of Shares, it
has used no solicitation materials other than those furnished by AEP; and (d) if
it is a foreign broker or dealer not eligible for membership in the National
Association of Securities Dealers, Inc. (the "NASD"), it has agreed to conform
to the NASD's Rules of Fair Practice in making solicitations.
The payment of compensation to any Soliciting Dealer is dependent on such
Soliciting Dealer returning a Notice of Solicited Tenders to the Depositary.
THIS LETTER OF TRANSMITTAL IS TO BE USED FOR THE TENDER OF SHARES OF THE
4.40% SERIES (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT) ONLY. ANY
PERSON DESIRING TO TENDER SHARES OF ANY OTHER SERIES OF CUMULATIVE PREFERRED
STOCK FOR WHICH AEP IS MAKING A TENDER OFFER MUST SUBMIT A LETTER OF TRANSMITTAL
RELATING TO THAT SPECIFIC SERIES.
<PAGE> 36
INSTRUCTIONS
FORMING PART OF THE
TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a firm that is a
member of a registered national securities exchange or the National Association
of Securities Dealers, Inc., or by a commercial bank or trust company having an
office or correspondent in the United States which is a participant in an
approved Medallion Signature Guarantee Program (each of the foregoing being
referred to as an "Eligible Institution"). Signatures on this Letter of
Transmittal need not be guaranteed (a) if this Letter of Transmittal is signed
by the registered holder(s) of the Shares (which term, for purposes of this
document, shall include any participant in one of the Book-Entry Transfer
Facilities whose name appears on a security position listing as the owner of
Shares) tendered herewith and such holder(s) has not completed the box above
under the heading "Special Payment Instructions" or the box above under the
heading "Special Delivery Instructions" on this Letter of Transmittal, or (b) if
such Shares are tendered for the account of an Eligible Institution. See
Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND SHARES. This Letter of
Transmittal is to be used if (a) certificates are to be forwarded herewith or,
(b) delivery of Shares is to be made by book-entry transfer pursuant to the
procedures set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. Certificates for
all physically delivered Shares, or a confirmation of a book-entry transfer into
the Depositary's account at one of the Book-Entry Transfer Facilities of all
Shares delivered electronically, as well as a properly completed and duly
executed Letter of Transmittal, and any other documents required by this Letter
of Transmittal, must be received by the Depositary at one of its addresses set
forth on the front page of this Letter of Transmittal on or prior to the
Expiration Date (as defined in the Offer to Purchase and Proxy Statement) with
respect to all Shares. Preferred Shareholders who wish to tender their Shares
yet who cannot deliver their Shares and all other required documents to the
Depositary on or prior to the Expiration Date must tender their Shares pursuant
to the guaranteed delivery procedure set forth under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement. Pursuant to such procedure: (a) such tender must be made by or
through an Eligible Institution, (b) a properly completed and duly executed
Notice of Guaranteed Delivery in the form provided by AEP (with any required
signature guarantees) must be received by the Depositary on or prior to the
applicable Expiration Date and (c) the certificates for all physically delivered
Shares, or a confirmation of a book-entry transfer into the Depositary's account
at one of the Book-Entry Transfer Facilities of all Shares delivered
electronically, together with a properly completed and duly executed Letter of
Transmittal and any other documents required by this Letter of Transmittal must
be received by the Depositary by 5:00 p.m. (New York City time) within three New
York Stock Exchange trading days after the date of execution of such Notice of
Guaranteed Delivery, all as provided under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF CERTIFICATES FOR
SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY
INSURED, IS RECOMMENDED.
No alternative, conditional or contingent tenders will be accepted. See
"Terms of the Offer -- Number of Shares; Purchase Prices; Expiration Date;
Dividends" in the Offer to Purchase and Proxy Statement. By executing this
Letter of Transmittal, the tendering stockholder waives any right to receive any
notice of the acceptance for payment of the Shares.
3. VOTING. WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES
PURSUANT TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S
AMENDED ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND
PROXY STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE
PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED
IN THE OFFER TO PURCHASE AND PROXY STATEMENT). In addition, Preferred
Shareholders have the right to vote for or against the Proposed Amendment
regardless of whether they tender their Shares by casting their vote and duly
executing the proxy enclosed herewith or by voting in person at the Special
Meeting. By executing a Notice of Guaranteed Delivery, a Preferred Shareholder
is deemed to have tendered the Shares described in such Notice of Guaranteed
Delivery and to have voted such Shares in accordance with the proxy returned
therewith, if any. If no vote is indicated on an otherwise properly executed
proxy, then all Shares in respect of such proxy will be voted in favor of the
Proposed Amendment. See "Proposed Amendment and Proxy Solicitation" in the Offer
to Purchase and Proxy Statement. The Offer is being sent to all persons in whose
names Shares are registered on the books of OPCo on the Record Date (as defined
in the Offer to Purchase and Proxy Statement) and transferees thereof. Only a
record holder of Shares on the Record Date may vote in person or by proxy at the
Special Meeting. No record date is fixed for determining which persons are
permitted to tender Shares. Any person who is the beneficial owner but not the
record holder of Shares must arrange for the record transfer of such Shares
prior to tendering.
4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the Shares represented by any
certificate delivered to the Depositary are to be tendered, fill in the number
of Shares that are to be tendered in the box above under the heading
"Description of Shares Tendered". In such case, a new certificate for the
remainder of the Shares represented by the old certificate will be sent to the
person(s) signing this Letter of Transmittal, unless otherwise provided in the
box above under the heading "Special Payment Instructions" or "Special Delivery
Instructions", as promptly as practicable following the expiration or
termination of the Offer. All Shares represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise indicated.
<PAGE> 37
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL AND/OR NOTICE OF GUARANTEED
DELIVERY; STOCK POWERS AND ENDORSEMENTS. If either this Letter of Transmittal
or the Notice of Guaranteed Delivery (together, the "Tender Documents") is
signed by the registered holder(s) of the Shares tendered hereby, the
signature(s) must correspond with the name(s) as written on the face of the
certificates without alteration, enlargement or any change whatsoever.
If any of the Shares tendered under either Tender Document is held of
record by two or more persons, all such persons must sign such Tender Document.
If any of the Shares tendered under either Tender Document is registered in
different names or different certificates, it will be necessary to complete,
sign and submit as many separate applicable Tender Documents as there are
different registrations or certificates.
If either Tender Document is signed by the registered holder(s) of the
Shares tendered hereby, no endorsements of certificates or separate stock powers
are required unless payment of the purchase price is to be made to, or Shares
not tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s). Signatures on any such certificates or
stock powers must be guaranteed by an Eligible Institution. See Instruction 1.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates must be
endorsed or accompanied by appropriate stock powers, in either case, signed
exactly as the name(s) of the registered holder(s) appear(s) on the certificates
for such Shares. Signature(s) on any such certificates or stock powers must be
guaranteed by an Eligible Institution. See Instruction 1.
If either Tender Document or any certificate or stock power is signed by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
AEP of the authority of such person so to act must be submitted.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, AEP
will pay or cause to be paid any stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price is to be made to, or Shares not tendered
or not purchased are to be registered in the name of, any person other than the
registered holder(s), or if tendered Shares are registered in the name of any
person other than the person(s) signing this Letter of Transmittal, the amount
of any stock transfer taxes (whether imposed on the registered holder(s), such
other person or otherwise) payable on account of the transfer to such person
will be deducted from the purchase price unless satisfactory evidence of the
payment of such taxes, or exemption therefrom, is submitted. See "Terms of the
Offer -- Acceptance of Shares for Payment and Payment of Purchase Price and
Dividends" in the Offer to Purchase and Proxy Statement. EXCEPT AS PROVIDED IN
THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE
CERTIFICATES REPRESENTING SHARES TENDERED HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any Shares purchased is to be issued in the name of, and/or
any Shares not tendered or not purchased are to be returned to, a person other
than the person(s) signing this Letter of Transmittal or if the check and/or any
certificate for Shares not tendered or not purchased are to be mailed to someone
other than the person(s) signing this Letter of Transmittal or to an address
other than that shown in the box above under the heading "Name(s) and
Address(es) of Registered Holder(s)", then the "Special Payment Instructions"
and/or "Special Delivery Instructions" on this Letter of Transmittal should be
completed. Preferred Shareholders tendering Shares by book-entry transfer will
have any Shares not accepted for payment returned by crediting the account
maintained by such Preferred Shareholder at the Book-Entry Transfer Facility
from which such transfer was made.
8. SUBSTITUTE FORM W-9 AND FORM W-8. The tendering Preferred Shareholder
is required to provide the Depositary with either a correct Taxpayer
Identification Number ("TIN") on Substitute Form W-9, which is provided under
"Important Tax Information" below, or a properly completed Form W-8. Failure to
provide the information on either Substitute Form W-9 or Form W-8 may subject
the tendering Preferred Shareholder to a $50 penalty imposed by the Internal
Revenue Service and to 31% federal income tax backup withholding on the payment
of the purchase price for the Shares. The box in Part 2 of Substitute Form W-9
may be checked if the tendering Preferred Shareholder has not been issued a TIN
and has applied for a number or intends to apply for a number in the near
future. If the box in Part 2 is checked and the Depositary is not provided with
a TIN by the time of payment, the Depositary will withhold 31% on all payments
of the purchase price for the Shares thereafter until a TIN is provided to the
Depositary.
9. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Any questions or
requests for assistance may be directed to the Information Agent or the Dealer
Managers at their respective telephone numbers and addresses listed below.
Requests for additional copies of the Offer to Purchase and Proxy Statement,
this Letter of Transmittal or other tender offer materials may be directed to
the Information Agent and such copies will be furnished promptly at AEP's
expense. Preferred Shareholders may also contact their local broker, dealer,
commercial bank or trust company for assistance concerning the Offer.
<PAGE> 38
10. SOLICITED TENDERS. AEP will pay a solicitation fee of $1.50 per Share
(except that for transactions for beneficial owners tendering more than 5,000
Shares, AEP will pay a solicitation fee of $1.00 per Share) for any Shares
tendered, accepted for payment and paid pursuant to the Offer, covered by the
Letter of Transmittal which designates, under the heading "Solicited Tenders",
as having solicited and obtained the tender, the name of (a) any broker or
dealer in securities, including a Dealer Manager in its capacity as a dealer or
broker, which is a member of any national securities exchange or of the National
Association of Securities Dealers, Inc. (the "NASD"), (b) any foreign broker or
dealer not eligible for membership in the NASD which agrees to conform to the
NASD's Rules of Fair Practice in soliciting tenders outside the United States to
the same extent as though it were an NASD member, or (c) any bank or trust
company (each of which is referred to herein as a "Soliciting Dealer"). No such
fee shall be payable to a Soliciting Dealer with respect to the tender of Shares
by a holder unless the Letter of Transmittal accompanying such tender designates
such Soliciting Dealer. No such fee shall be payable to a Soliciting Dealer in
respect of Shares registered in the name of such Soliciting Dealer unless such
Shares are held by such Soliciting Dealer as nominee and such Shares are being
tendered for the benefit of one or more beneficial owners identified on the
Letter of Transmittal or on the Notice of Solicited Tenders (included in the
materials provided to brokers and dealers). No such fee shall be payable to a
Soliciting Dealer with respect to the tender of Shares by the holder of record,
for the benefit of the beneficial owner, unless the beneficial owner has
designated such Soliciting Dealer. If tendered Shares are being delivered by
book-entry transfer, the Soliciting Dealer must return a Notice of Solicited
Tenders to the Depositary within three business days after expiration of the
Offer to receive a solicitation fee. No such fee shall be payable to a
Soliciting Dealer if such Soliciting Dealer is required for any reason to
transfer the amount of such fee to a depositing holder (other than itself). No
such fee shall be paid to a Soliciting Dealer with respect to Shares tendered
for such Soliciting Dealer's own account. No broker, dealer, bank, trust company
or fiduciary shall be deemed to be the agent of AEP, the Depositary, the
Information Agent or the Dealer Managers for purposes of the Offer.
Soliciting Dealers will include any organizations described in clauses (a),
(b) or (c) above even when the activities of such organization in connection
with the Offer consist solely of forwarding to clients materials relating to the
Offer, including this Letter of Transmittal, and rendering Shares as directed by
beneficial owners thereof. No Soliciting Dealer is required to make any
recommendation to holders of Shares as to whether to tender or refrain from
tendering in the Offer. No assumption is made, in making payment to any
Soliciting Dealer, that its activities in connection with the Offer included any
activities other than those described above, and for all purposes noted in all
materials relating to the Offer, the term "solicit" shall be deemed to mean no
more than "processing shares tendered" or "forwarding to customers materials
regarding the Offer."
11. IRREGULARITIES. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance of any tender
of Shares will be determined by AEP, in its sole discretion, and its
determination shall be final and binding. AEP reserves the absolute right to
reject any and all tenders of Shares that it determines are not in proper form
or the acceptance for payment of or payment for Shares that may, in the opinion
of AEP's counsel, be unlawful. AEP also reserves the absolute right to waive any
of the conditions to the Offer or any defect or irregularity in any tender of
Shares and AEP's interpretation of the terms and conditions of the Offer
(including these instructions) shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as AEP shall determine. None of AEP, OPCo, the Dealer Managers, the
Depositary, the Information Agent or any other person shall be under any duty to
give notice of any defect or irregularity in tenders, nor shall any of them
incur any liability for failure to give any such notice. Tenders will not be
deemed to have been made until all defects and irregularities have been cured or
waived.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any of your certificate(s)
for Shares have been lost, stolen or destroyed, please call the Depositary at
1-800-649-2153. In addition, you should advise the Depositary of any
certificate(s) you have in your possession. You will need to complete an
Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by the Depositary) and pay an indemnity bond premium fee. The tender of
Shares pursuant to this Letter of Transmittal will not be valid unless prior to
the Expiration Date: (a) such procedures have been completed and a replacement
certificate for the Shares has been delivered to the Depositary or (b) a Notice
of Guaranteed Delivery has been delivered to the Depositary. See Instruction 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL, DULY EXECUTED, TOGETHER WITH, IF
APPLICABLE, CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER, AND ALL OTHER
REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR, IF APPLICABLE, THE
NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY, ON OR PRIOR TO
THE APPLICABLE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under federal income tax law, a Preferred Shareholder whose tendered Shares
are accepted for payment is required to provide the Depositary (as payer) with
either such Preferred Shareholder's correct TIN on Substitute Form W-9 below or
a properly completed Form W-8. If such Preferred Shareholder is an individual,
the TIN is his or her social security number. For businesses and other entities,
the number is the federal employer identification number. If the Depositary is
not provided with the correct TIN or properly completed Form W-8, the Preferred
Shareholder may be subject to a $50 penalty imposed by the Internal Revenue
Code. In addition, payments that are made to such Preferred Shareholder with
respect to Shares purchased pursuant to the Offer may be subject to 31% backup
withholding.
<PAGE> 39
Certain Preferred Shareholders (including, among others, all corporations
and certain foreign individuals) are exempt from backup withholding. For a
corporate United States Preferred Shareholder to qualify for such exemption,
such Preferred Shareholder must provide the Depositary with a properly completed
and executed Substitute Form W-9 attesting to its exempt status. In order for a
foreign Preferred Shareholder to qualify as an exempt recipient, such Preferred
Shareholder must submit to the Depositary a properly completed Internal Revenue
Service Form W-8 (a "Form W-8"), signed under penalties of perjury, attesting to
that Preferred Shareholder's exempt status. A Form W-8 can be obtained from the
Depositary. See the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional instructions.
If federal income tax backup withholding applies, the Depositary is
required to withhold 31% of any payments made to the Preferred Shareholder.
Backup withholding is not an additional tax. Rather, the Federal income tax
liability of persons subject to backup withholding will be reduced by the amount
of the tax withheld. If withholding results in an overpayment of taxes, a refund
may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on payments that are made to a Preferred
Shareholder with respect to Shares purchased pursuant to the Offer, the
Preferred Shareholder is required to notify the Depositary of his or her correct
TIN by completing the Substitute Form W-9 attached hereto certifying that the
TIN provided on Substitute Form W-9 is correct and that (a) the Preferred
Shareholder has not been notified by the Internal Revenue Service that he or she
is subject to federal income tax backup withholding as a result of failure to
report all interest or dividends or (b) the Internal Revenue Service has
notified the Preferred Shareholder that he or she is no longer subject to
federal income tax backup withholding. Foreign Preferred Shareholders must
submit a properly completed Form W-8 in order to avoid the applicable backup
withholding.
WHAT NUMBER TO GIVE THE DEPOSITARY
The Preferred Shareholder is required to give the Depositary the social
security number or employer identification number of the registered owner of the
Shares. If the Shares are in more than one name or are not in the name of the
actual owner, consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional guidance on which
number to report.
PAYER'S NAME: FIRST CHICAGO TRUST COMPANY OF NEW YORK
<TABLE>
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Part 1 -- PLEASE PROVIDE YOUR TIN IN THE Social Security Number OR
BOX AT RIGHT AND CERTIFY BY SIGNING AND Employer Identification Number
DATING BELOW. TIN ______________________________
---------------------------------------------------------------------------------------
SUBSTITUTE Name (Please Print) ____________________
Address ________________________________ Part 2 --
City __________ State ___ Zip Code _____ Awaiting TIN [ ]
---------------------------------------------------------------------------------------
FORM W-9 Part 3 -- CERTIFICATION -- UNDER PENALTIES OF PERJURY. I CERTIFY THAT: (1) the number
DEPARTMENT OF THE TREASURY shown on the form is my correct taxpayer identification number (or a TIN has not been
INTERNAL REVENUE SERVICE issued to me but I have mailed or delivered an application to receive a TIN or intend
to do so in the near future), (2) I am not subject to backup withholding either because
I have not been notified by the Internal Revenue Service (the "IRS") that I am subject
to backup withholding as a result of a failure to report all interest or dividends or
the IRS has notified me that I am no longer subject to backup withholding and (3) all
other information provided on this form is true, correct and complete.
SIGNATURE ___________________________________________ DATE_____________________ 1997
You must cross out item (2) above if you have been notified by the IRS that you are
currently subject to backup withholding because of underreporting interest or dividends
on your tax return.
---------------------------------------------------------------------------------------
PAYER'S REQUEST FOR TAXPAYER NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31%
IDENTIFICATION NUMBER ("TIN") OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE ENCLOSED
AND CERTIFICATION GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9
FOR ADDITIONAL DETAILS. YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE
BOX IN PART 2 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has not been
issued to me and either (1) I have mailed or delivered an application to receive a
taxpayer identification number to the appropriate Internal Revenue Service Center or
Social Security Administration Office or (2) I intend to do so in the near future. I
understand that if I do not provide a taxpayer identification number by the time of
payment, 31% of all payments of the purchase price made to me will be withheld until I
provide a number.
SIGNATURE _________________________________________ Date: _____________________ 1997.
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 40
THE DEALER MANAGERS:
<TABLE>
<S> <C>
MERRILL LYNCH & CO. SALOMON BROTHERS INC
World Financial Center Seven World Trade Center
250 Vesey Street New York, New York 10048
New York, New York 10281 Attn: Liability Management Department
(888) ML4-TNDR (toll free) (800) 558-3745 (toll free)
((888) 654-8637 (toll free))
</TABLE>
THE INFORMATION AGENT:
MORROW & CO., INC.
909 Third Avenue
New York, New York 10022-4799
(800) 566-9061 (call toll free)
(212) 754-8000
<PAGE> 41
5.90% OPCO
LETTER OF TRANSMITTAL
TO ACCOMPANY
SHARES OF 5.90% SERIES CUMULATIVE PREFERRED STOCK
CUSIP NUMBER 677415 79 6
OF
OHIO POWER COMPANY
TENDERED PURSUANT TO THE OFFER TO PURCHASE FOR CASH
BY
AMERICAN ELECTRIC POWER COMPANY, INC.
DATED JANUARY 30, 1997, FOR PURCHASE AT A
PURCHASE PRICE OF $103.09 PER SHARE
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON FRIDAY, FEBRUARY 28, 1997, UNLESS THE OFFER IS EXTENDED.
TO: FIRST CHICAGO TRUST COMPANY OF NEW YORK, DEPOSITARY
<TABLE>
<S> <C> <C>
BY MAIL: BY HAND: BY OVERNIGHT COURIER:
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
P.O. Box 2569 c/o The Depository Trust Company 14 Wall Street, 8th
Suite 4660 55 Water Street, DTC TAD Floor
Jersey City, NJ 07303-2569 Vietnam Veterans Memorial Plaza Suite 4680-OPCO
New York, NY 10041 New York, NY 10005
</TABLE>
AMERICAN ELECTRIC POWER COMPANY, INC. ("AEP") WILL NOT BE REQUIRED TO
ACCEPT FOR PAYMENT OR PAY FOR ANY SHARES TENDERED IF THE PROPOSED AMENDMENT IS
NOT APPROVED AND ADOPTED AT THE SPECIAL MEETING. PREFERRED SHAREHOLDERS OF
RECORD OF OHIO POWER COMPANY ("OPCO") HAVE THE RIGHT TO VOTE FOR OR AGAINST THE
PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES BY CASTING
THEIR VOTE AND SIGNING THE PROXY ENCLOSED HEREWITH OR BY VOTING IN PERSON AT THE
SPECIAL MEETING. IF THE PROPOSED AMENDMENT IS APPROVED AND ADOPTED BY OPCO'S
SHAREHOLDERS, OPCO WILL MAKE A SPECIAL CASH PAYMENT TO EACH PREFERRED
SHAREHOLDER WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT THEIR
SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
- --------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDERS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NOTE: IF SHARES ARE BEING TENDERED, THE REMAINDER OF THIS LETTER OF TRANSMITTAL
MUST BE COMPLETED, INCLUDING, IF APPLICABLE, THE SUBSTITUTE FORM W-9
BELOW.
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS LETTER OF
TRANSMITTAL IN THE APPROPRIATE SPACE THEREFOR PROVIDED AND, IF YOU ARE TENDERING
ANY SHARES, COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW OR A FORM W-8, AS
APPLICABLE. SEE INSTRUCTION 8 AND "IMPORTANT TAX INFORMATION" BELOW.
DO NOT SEND ANY CERTIFICATES TO MERRILL LYNCH & CO., SALOMON BROTHERS INC,
MORROW & CO., INC., AMERICAN ELECTRIC POWER COMPANY, INC. OR OHIO POWER COMPANY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED. QUESTIONS REGARDING
AND REQUESTS FOR COPIES OF THE OFFER TO PURCHASE AND PROXY STATEMENT OR THIS
LETTER OF TRANSMITTAL MAY BE DIRECTED TO MORROW & CO., INC., THE INFORMATION
AGENT, AT 909 THIRD AVENUE, NEW YORK, NEW YORK 10022-4799 OR TELEPHONE (800)
566-9061 (TOLL FREE).
<PAGE> 42
This Letter of Transmittal is to be used (a) if certificates are to be
forwarded to the First Chicago Trust Company of New York ("Depositary") or (b)
if delivery of tendered Shares (as defined below) is to be made by book-entry
transfer to the Depositary's account at The Depository Trust Company ("DTC") or
the Philadelphia Depository Trust Company ("PDTC") (hereinafter collectively
referred to as the "Book-Entry Transfer Facilities") pursuant to the procedures
set forth under the heading "Terms of the Offer -- Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement (as defined below).
Preferred Shareholders (as defined below) who wish to tender Shares but who
cannot deliver their Shares and all other documents required hereby to the
Depositary by the Expiration Date (as defined in the Offer to Purchase and Proxy
Statement) must tender their Shares pursuant to the guaranteed delivery
procedure set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. See Instruction
2. DELIVERY OF DOCUMENTS TO AEP, OPCO OR A BOOK-ENTRY TRANSFER FACILITY DOES NOT
CONSTITUTE A VALID DELIVERY.
- --------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
(IF TENDERING SHARES, PLEASE FILL IN EXACTLY AS INFORMATION APPEARS ON
CERTIFICATE(S))
(ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
TOTAL NUMBER OF SHARES
CERTIFICATE NUMBER(S)* REPRESENTED BY CERTIFICATE(S) NUMBER OF SHARES TENDERED**
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented by
any certificates delivered to the Depositary are being tendered. See
Instruction 4.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Depositary at 1-800-649-2153. In addition, you should
advise the Depositary of any certificate(s) you have in your possession. You
will need to complete an Affidavit of Loss with respect to the lost
certificate(s) (which will be provided by the Depositary) and pay an indemnity
bond premium fee.
(BOXES BELOW FOR USE BY ELIGIBLE INSTITUTIONS ONLY)
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
TO THE DEPOSITARY'S ACCOUNT AT A BOOK-ENTRY TRANSFER FACILITY AND
COMPLETE THE FOLLOWING:
Name of tendering institution
Account No.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE
OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE
THE FOLLOWING:
Name(s) of tendering shareholder(s)
Date of execution of Notice of Guaranteed Delivery
Name of institution that guaranteed delivery
If delivery is by book-entry transfer:
Name of tendering institution
Account no.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
<PAGE> 43
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to American Electric Power Company, Inc., a
New York corporation ("AEP"), the shares in the amount set forth in the box
above designated "Description of Shares Tendered" pursuant to AEP's offer to
purchase any and all of the outstanding shares of the series of cumulative
preferred stock of Ohio Power Company, an Ohio corporation, and direct utility
subsidiary of AEP ("OPCo"), shown on the first page hereof as to which this
Letter of Transmittal is applicable (the "Shares") at the purchase price per
Share shown on the first page hereof plus accrued and unpaid dividends thereon,
net to the seller in cash, upon the terms and subject to the conditions set
forth in the Offer to Purchase and Proxy Statement, dated January 30, 1997 (the
"Offer to Purchase and Proxy Statement"), receipt of which is hereby
acknowledged, and in this Letter of Transmittal (which as to the Shares,
together with the Offer to Purchase and Proxy Statement, constitutes the
"Offer"). WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT
TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S AMENDED
ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND PROXY
STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE PROPOSED
AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED IN THE
OFFER TO PURCHASE AND PROXY STATEMENT). See "Proposed Amendment and Proxy
Solicitation", "Terms of the Offer -- Extension of Tender Period; Termination;
Amendments" and "Terms of the Offer -- Certain Conditions of the Offer" in the
Offer to Purchase and Proxy Statement.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the undersigned hereby
sells, assigns and transfers to, or upon the order of, AEP all right, title and
interest in and to all the Shares that are being tendered hereby and hereby
constitutes and appoints First Chicago Trust Company of New York (the
"Depositary") the true and lawful agent and attorney-in-fact of the undersigned
with respect to such Shares, with full power of substitution (such power of
attorney being an irrevocable power coupled with an interest), to (a) deliver
certificates for such Shares, or transfer ownership of such Shares on the
account books maintained by the Book-Entry Transfer Facility that holds such
Shares, together, in any such case, with all accompanying evidences of transfer
and authenticity, to or upon the order of AEP, (b) present such Shares for
registration and transfer on the books of OPCo and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, all in
accordance with the terms of the Offer. The Depositary will act as agent for
tendering stockholders for the purpose of receiving payment from AEP and
transmitting payment to tendering stockholders.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Shares
tendered hereby and that, when and to the extent the same are accepted for
payment by AEP, AEP will acquire good, marketable and unencumbered title
thereto, free and clear of all liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the same will not be subject to any adverse claims. The
undersigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or AEP to be necessary or desirable to complete the
sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by, and shall survive the death, bankruptcy or incapacity of the
undersigned, and any obligations of the undersigned hereunder shall be binding
upon the heirs, legal representatives, successors, assigns, executors and
administrators of the undersigned. Except as stated in the Offer, this tender is
irrevocable.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and in the
instructions hereto will constitute the undersigned's acceptance of the terms
and conditions of the Offer, including the undersigned's representation and
warranty that (a) the undersigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (b) the tender of such Shares complies
with such Rule 14e-4. AEP's acceptance for payment of Shares tendered pursuant
to the Offer will constitute a binding agreement between the undersigned and AEP
upon the terms and subject to the conditions of the Offer.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase and Proxy Statement, AEP may terminate or amend the Offer
or may not be required to purchase any of the Shares tendered hereby. In either
event, the undersigned understands that certificate(s) for any Shares not
tendered or not purchased will be returned to the undersigned.
<PAGE> 44
Unless otherwise indicated in the box below under the heading "Special
Payment Instructions", please issue the check for the purchase price of any
Shares purchased, and/or return any Shares not tendered or not purchased, in the
name(s) of the undersigned (and, in the case of Shares tendered by book-entry
transfer, by credit to the account at the Book-Entry Transfer Facility
designated above). Similarly, unless otherwise indicated in the box below under
the heading "Special Delivery Instructions", please mail the check for the
purchase price of any Shares purchased and/or any certificates for Shares not
tendered or not purchased (and accompanying documents, as appropriate) to the
undersigned at the address shown below the undersigned signature(s). In the
event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any Shares purchased and/or return any Shares not tendered or not purchased in
the name(s) of, and mail said check and/or any certificates to, the person(s) so
indicated. The undersigned recognizes that AEP has no obligation, pursuant to
the "Special Payment Instructions", to transfer any Shares from the name of the
registered holder(s) thereof if AEP does not accept for payment any of the
Shares so tendered.
----------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 5 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be issued in the name of someone other than the undersigned.
Issue: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
-------------------------------------------------------
----------------------------------------------------------------
(INCLUDE ZIP CODE)
----------------------------------------------------------------
(TAXPAYER IDENTIFICATION OR
SOCIAL SECURITY NUMBER)
----------------------------------------------------------------
----------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 4 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be mailed to someone other than the undersigned or to the undersigned
at an address other than that shown below the undersigned's signature(s).
Mail: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
-------------------------------------------------------
----------------------------------------------------------------
(INCLUDE ZIP CODE)
----------------------------------------------------------------
----------------------------------------------------------------
SIGNATURE(S) OF OWNER(S)
X
- --------------------------------------------------------------------------------
X
- --------------------------------------------------------------------------------
Dated: ___________________________________________________________________, 1997
Name(s):
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title):
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.:
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on the
stock certificate(s) or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in a
fiduciary or representative capacity, please set forth full title and see
Instruction 5.)
<PAGE> 45
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5)
Authorized Signature:
Name:
Name of Firm:
Address of Firm:
Area Code and Telephone No.:
Dated: __________________________________________________________________, 1997
IF SHARES ARE BEING TENDERED, PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW OR
A FORM W-8, AS APPLICABLE.
SOLICITED TENDERS
(SEE INSTRUCTION 10)
As provided in Instruction 10, AEP will pay to any Soliciting Dealer, as
defined in Instruction 10, a solicitation fee of $.50 per Share for any Shares
tendered, accepted for payment and paid pursuant to the Offer. However,
Soliciting Dealers will not be entitled to a solicitation fee for Shares
beneficially owned by such Soliciting Dealer.
The abovesigned represents that the Soliciting Dealer which solicited and
obtained this tender is:
Name of Firm:
(PLEASE PRINT)
Name of Individual Broker
or Financial Consultant:
Telephone Number of Broker
or Financial Consultant:
Identification Number (if known):
Address:
(INCLUDE ZIP CODE)
The following to be completed ONLY if customer's Shares held in nominee
name are tendered.
<TABLE>
<CAPTION>
NAME OF BENEFICIAL OWNER NUMBER OF SHARES TENDERED
- ------------------------ -------------------------
(ATTACH ADDITIONAL LIST IF NECESSARY)
<S> <C>
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
</TABLE>
The acceptance of compensation by such Soliciting Dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase and Proxy Statement; (c) in soliciting tenders of Shares, it
has used no solicitation materials other than those furnished by AEP; and (d) if
it is a foreign broker or dealer not eligible for membership in the National
Association of Securities Dealers, Inc. (the "NASD"), it has agreed to conform
to the NASD's Rules of Fair Practice in making solicitations.
The payment of compensation to any Soliciting Dealer is dependent on such
Soliciting Dealer returning a Notice of Solicited Tenders to the Depositary.
THIS LETTER OF TRANSMITTAL IS TO BE USED FOR THE TENDER OF SHARES OF THE
5.90% SERIES (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT) ONLY. ANY
PERSON DESIRING TO TENDER SHARES OF ANY OTHER SERIES OF CUMULATIVE PREFERRED
STOCK FOR WHICH AEP IS MAKING A TENDER OFFER MUST SUBMIT A LETTER OF TRANSMITTAL
RELATING TO THAT SPECIFIC SERIES.
<PAGE> 46
INSTRUCTIONS
FORMING PART OF THE
TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a firm that is a
member of a registered national securities exchange or the National Association
of Securities Dealers, Inc., or by a commercial bank or trust company having an
office or correspondent in the United States which is a participant in an
approved Medallion Signature Guarantee Program (each of the foregoing being
referred to as an "Eligible Institution"). Signatures on this Letter of
Transmittal need not be guaranteed (a) if this Letter of Transmittal is signed
by the registered holder(s) of the Shares (which term, for purposes of this
document, shall include any participant in one of the Book-Entry Transfer
Facilities whose name appears on a security position listing as the owner of
Shares) tendered herewith and such holder(s) has not completed the box above
under the heading "Special Payment Instructions" or the box above under the
heading "Special Delivery Instructions" on this Letter of Transmittal, or (b) if
such Shares are tendered for the account of an Eligible Institution. See
Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND SHARES. This Letter of
Transmittal is to be used if (a) certificates are to be forwarded herewith or,
(b) delivery of Shares is to be made by book-entry transfer pursuant to the
procedures set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. Certificates for
all physically delivered Shares, or a confirmation of a book-entry transfer into
the Depositary's account at one of the Book-Entry Transfer Facilities of all
Shares delivered electronically, as well as a properly completed and duly
executed Letter of Transmittal, and any other documents required by this Letter
of Transmittal, must be received by the Depositary at one of its addresses set
forth on the front page of this Letter of Transmittal on or prior to the
Expiration Date (as defined in the Offer to Purchase and Proxy Statement) with
respect to all Shares. Preferred Shareholders who wish to tender their Shares
yet who cannot deliver their Shares and all other required documents to the
Depositary on or prior to the Expiration Date must tender their Shares pursuant
to the guaranteed delivery procedure set forth under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement. Pursuant to such procedure: (a) such tender must be made by or
through an Eligible Institution, (b) a properly completed and duly executed
Notice of Guaranteed Delivery in the form provided by AEP (with any required
signature guarantees) must be received by the Depositary on or prior to the
applicable Expiration Date and (c) the certificates for all physically delivered
Shares, or a confirmation of a book-entry transfer into the Depositary's account
at one of the Book-Entry Transfer Facilities of all Shares delivered
electronically, together with a properly completed and duly executed Letter of
Transmittal and any other documents required by this Letter of Transmittal must
be received by the Depositary by 5:00 p.m. (New York City time) within three New
York Stock Exchange trading days after the date of execution of such Notice of
Guaranteed Delivery, all as provided under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF CERTIFICATES FOR
SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY
INSURED, IS RECOMMENDED.
No alternative, conditional or contingent tenders will be accepted. See
"Terms of the Offer -- Number of Shares; Purchase Prices; Expiration Date;
Dividends" in the Offer to Purchase and Proxy Statement. By executing this
Letter of Transmittal, the tendering stockholder waives any right to receive any
notice of the acceptance for payment of the Shares.
3. VOTING. WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES
PURSUANT TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S
AMENDED ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND
PROXY STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE
PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED
IN THE OFFER TO PURCHASE AND PROXY STATEMENT). In addition, Preferred
Shareholders have the right to vote for or against the Proposed Amendment
regardless of whether they tender their Shares by casting their vote and duly
executing the proxy enclosed herewith or by voting in person at the Special
Meeting. By executing a Notice of Guaranteed Delivery, a Preferred Shareholder
is deemed to have tendered the Shares described in such Notice of Guaranteed
Delivery and to have voted such Shares in accordance with the proxy returned
therewith, if any. If no vote is indicated on an otherwise properly executed
proxy, then all Shares in respect of such proxy will be voted in favor of the
Proposed Amendment. See "Proposed Amendment and Proxy Solicitation" in the Offer
to Purchase and Proxy Statement. The Offer is being sent to all persons in whose
names Shares are registered on the books of OPCo on the Record Date (as defined
in the Offer to Purchase and Proxy Statement) and transferees thereof. Only a
record holder of Shares on the Record Date may vote in person or by proxy at the
Special Meeting. No record date is fixed for determining which persons are
permitted to tender Shares. Any person who is the beneficial owner but not the
record holder of Shares must arrange for the record transfer of such Shares
prior to tendering.
4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the Shares represented by any
certificate delivered to the Depositary are to be tendered, fill in the number
of Shares that are to be tendered in the box above under the heading
"Description of Shares Tendered". In such case, a new certificate for the
remainder of the Shares represented by the old certificate will be sent to the
person(s) signing this Letter of Transmittal, unless otherwise provided in the
box above under the heading "Special Payment Instructions" or "Special Delivery
Instructions", as promptly as practicable following the expiration or
termination of the Offer. All Shares represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise indicated.
<PAGE> 47
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL AND/OR NOTICE OF GUARANTEED
DELIVERY; STOCK POWERS AND ENDORSEMENTS. If either this Letter of Transmittal
or the Notice of Guaranteed Delivery (together, the "Tender Documents") is
signed by the registered holder(s) of the Shares tendered hereby, the
signature(s) must correspond with the name(s) as written on the face of the
certificates without alteration, enlargement or any change whatsoever.
If any of the Shares tendered under either Tender Document is held of
record by two or more persons, all such persons must sign such Tender Document.
If any of the Shares tendered under either Tender Document is registered in
different names or different certificates, it will be necessary to complete,
sign and submit as many separate applicable Tender Documents as there are
different registrations or certificates.
If either Tender Document is signed by the registered holder(s) of the
Shares tendered hereby, no endorsements of certificates or separate stock powers
are required unless payment of the purchase price is to be made to, or Shares
not tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s). Signatures on any such certificates or
stock powers must be guaranteed by an Eligible Institution. See Instruction 1.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates must be
endorsed or accompanied by appropriate stock powers, in either case, signed
exactly as the name(s) of the registered holder(s) appear(s) on the certificates
for such Shares. Signature(s) on any such certificates or stock powers must be
guaranteed by an Eligible Institution. See Instruction 1.
If either Tender Document or any certificate or stock power is signed by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
AEP of the authority of such person so to act must be submitted.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, AEP
will pay or cause to be paid any stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price is to be made to, or Shares not tendered
or not purchased are to be registered in the name of, any person other than the
registered holder(s), or if tendered Shares are registered in the name of any
person other than the person(s) signing this Letter of Transmittal, the amount
of any stock transfer taxes (whether imposed on the registered holder(s), such
other person or otherwise) payable on account of the transfer to such person
will be deducted from the purchase price unless satisfactory evidence of the
payment of such taxes, or exemption therefrom, is submitted. See "Terms of the
Offer -- Acceptance of Shares for Payment and Payment of Purchase Price and
Dividends" in the Offer to Purchase and Proxy Statement. EXCEPT AS PROVIDED IN
THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE
CERTIFICATES REPRESENTING SHARES TENDERED HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any Shares purchased is to be issued in the name of, and/or
any Shares not tendered or not purchased are to be returned to, a person other
than the person(s) signing this Letter of Transmittal or if the check and/or any
certificate for Shares not tendered or not purchased are to be mailed to someone
other than the person(s) signing this Letter of Transmittal or to an address
other than that shown in the box above under the heading "Name(s) and
Address(es) of Registered Holder(s)", then the "Special Payment Instructions"
and/or "Special Delivery Instructions" on this Letter of Transmittal should be
completed. Preferred Shareholders tendering Shares by book-entry transfer will
have any Shares not accepted for payment returned by crediting the account
maintained by such Preferred Shareholder at the Book-Entry Transfer Facility
from which such transfer was made.
8. SUBSTITUTE FORM W-9 AND FORM W-8. The tendering Preferred Shareholder
is required to provide the Depositary with either a correct Taxpayer
Identification Number ("TIN") on Substitute Form W-9, which is provided under
"Important Tax Information" below, or a properly completed Form W-8. Failure to
provide the information on either Substitute Form W-9 or Form W-8 may subject
the tendering Preferred Shareholder to a $50 penalty imposed by the Internal
Revenue Service and to 31% federal income tax backup withholding on the payment
of the purchase price for the Shares. The box in Part 2 of Substitute Form W-9
may be checked if the tendering Preferred Shareholder has not been issued a TIN
and has applied for a number or intends to apply for a number in the near
future. If the box in Part 2 is checked and the Depositary is not provided with
a TIN by the time of payment, the Depositary will withhold 31% on all payments
of the purchase price for the Shares thereafter until a TIN is provided to the
Depositary.
9. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Any questions or
requests for assistance may be directed to the Information Agent or the Dealer
Managers at their respective telephone numbers and addresses listed below.
Requests for additional copies of the Offer to Purchase and Proxy Statement,
this Letter of Transmittal or other tender offer materials may be directed to
the Information Agent and such copies will be furnished promptly at AEP's
expense. Preferred Shareholders may also contact their local broker, dealer,
commercial bank or trust company for assistance concerning the Offer.
<PAGE> 48
10. SOLICITED TENDERS. AEP will pay a solicitation fee of $.50 per Share
for any Shares tendered, accepted for payment and paid pursuant to the Offer,
covered by the Letter of Transmittal which designates, under the heading
"Solicited Tenders", as having solicited and obtained the tender, the name of
(a) any broker or dealer in securities, including a Dealer Manager in its
capacity as a dealer or broker, which is a member of any national securities
exchange or of the National Association of Securities Dealers, Inc. (the
"NASD"), (b) any foreign broker or dealer not eligible for membership in the
NASD which agrees to conform to the NASD's Rules of Fair Practice in soliciting
tenders outside the United States to the same extent as though it were an NASD
member, or (c) any bank or trust company (each of which is referred to herein as
a "Soliciting Dealer"). No such fee shall be payable to a Soliciting Dealer with
respect to the tender of Shares by a holder unless the Letter of Transmittal
accompanying such tender designates such Soliciting Dealer. No such fee shall be
payable to a Soliciting Dealer in respect of Shares registered in the name of
such Soliciting Dealer unless such Shares are held by such Soliciting Dealer as
nominee and such Shares are being tendered for the benefit of one or more
beneficial owners identified on the Letter of Transmittal or on the Notice of
Solicited Tenders (included in the materials provided to brokers and dealers).
No such fee shall be payable to a Soliciting Dealer with respect to the tender
of Shares by the holder of record, for the benefit of the beneficial owner,
unless the beneficial owner has designated such Soliciting Dealer. If tendered
Shares are being delivered by book-entry transfer, the Soliciting Dealer must
return a Notice of Solicited Tenders to the Depositary within three business
days after expiration of the Offer to receive a solicitation fee. No such fee
shall be payable to a Soliciting Dealer if such Soliciting Dealer is required
for any reason to transfer the amount of such fee to a depositing holder (other
than itself). No such fee shall be paid to a Soliciting Dealer with respect to
Shares tendered for such Soliciting Dealer's own account. No broker, dealer,
bank, trust company or fiduciary shall be deemed to be the agent of AEP, the
Depositary, the Information Agent or the Dealer Managers for purposes of the
Offer.
Soliciting Dealers will include any organizations described in clauses (a),
(b) or (c) above even when the activities of such organization in connection
with the Offer consist solely of forwarding to clients materials relating to the
Offer, including this Letter of Transmittal, and rendering Shares as directed by
beneficial owners thereof. No Soliciting Dealer is required to make any
recommendation to holders of Shares as to whether to tender or refrain from
tendering in the Offer. No assumption is made, in making payment to any
Soliciting Dealer, that its activities in connection with the Offer included any
activities other than those described above, and for all purposes noted in all
materials relating to the Offer, the term "solicit" shall be deemed to mean no
more than "processing shares tendered" or "forwarding to customers materials
regarding the Offer."
11. IRREGULARITIES. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance of any tender
of Shares will be determined by AEP, in its sole discretion, and its
determination shall be final and binding. AEP reserves the absolute right to
reject any and all tenders of Shares that it determines are not in proper form
or the acceptance for payment of or payment for Shares that may, in the opinion
of AEP's counsel, be unlawful. AEP also reserves the absolute right to waive any
of the conditions to the Offer or any defect or irregularity in any tender of
Shares and AEP's interpretation of the terms and conditions of the Offer
(including these instructions) shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as AEP shall determine. None of AEP, OPCO, the Dealer Managers, the
Depositary, the Information Agent or any other person shall be under any duty to
give notice of any defect or irregularity in tenders, nor shall any of them
incur any liability for failure to give any such notice. Tenders will not be
deemed to have been made until all defects and irregularities have been cured or
waived.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any of your certificate(s)
for Shares have been lost, stolen or destroyed, please call the Depositary at
1-800-649-2153. In addition, you should advise the Depositary of any
certificate(s) you have in your possession. You will need to complete an
Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by the Depositary) and pay an indemnity bond premium fee. The tender of
Shares pursuant to this Letter of Transmittal will not be valid unless prior to
the Expiration Date: (a) such procedures have been completed and a replacement
certificate for the Shares has been delivered to the Depositary or (b) a Notice
of Guaranteed Delivery has been delivered to the Depositary. See Instruction 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL, DULY EXECUTED, TOGETHER WITH, IF
APPLICABLE, CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER, AND ALL OTHER
REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR, IF APPLICABLE, THE
NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY, ON OR PRIOR TO
THE APPLICABLE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under federal income tax law, a Preferred Shareholder whose tendered Shares
are accepted for payment is required to provide the Depositary (as payer) with
either such Preferred Shareholder's correct TIN on Substitute Form W-9 below or
a properly completed Form W-8. If such Preferred Shareholder is an individual,
the TIN is his or her social security number. For businesses and other entities,
the number is the federal employer identification number. If the Depositary is
not provided with the correct TIN or properly completed Form W-8, the Preferred
Shareholder may be subject to a $50 penalty imposed by the Internal Revenue
Code. In addition, payments that are made to such Preferred Shareholder with
respect to Shares purchased pursuant to the Offer may be subject to 31% backup
withholding.
<PAGE> 49
Certain Preferred Shareholders (including, among others, all corporations
and certain foreign individuals) are exempt from backup withholding. For a
corporate United States Preferred Shareholder to qualify for such exemption,
such Preferred Shareholder must provide the Depositary with a properly completed
and executed Substitute Form W-9 attesting to its exempt status. In order for a
foreign Preferred Shareholder to qualify as an exempt recipient, such Preferred
Shareholder must submit to the Depositary a properly completed Internal Revenue
Service Form W-8 (a "Form W-8"), signed under penalties of perjury, attesting to
that Preferred Shareholder's exempt status. A Form W-8 can be obtained from the
Depositary. See the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional instructions.
If federal income tax backup withholding applies, the Depositary is
required to withhold 31% of any payments made to the Preferred Shareholder.
Backup withholding is not an additional tax. Rather, the Federal income tax
liability of persons subject to backup withholding will be reduced by the amount
of the tax withheld. If withholding results in an overpayment of taxes, a refund
may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on payments that are made to a Preferred
Shareholder with respect to Shares purchased pursuant to the Offer, the
Preferred Shareholder is required to notify the Depositary of his or her correct
TIN by completing the Substitute Form W-9 attached hereto certifying that the
TIN provided on Substitute Form W-9 is correct and that (a) the Preferred
Shareholder has not been notified by the Internal Revenue Service that he or she
is subject to federal income tax backup withholding as a result of failure to
report all interest or dividends or (b) the Internal Revenue Service has
notified the Preferred Shareholder that he or she is no longer subject to
federal income tax backup withholding. Foreign Preferred Shareholders must
submit a properly completed Form W-8 in order to avoid the applicable backup
withholding.
WHAT NUMBER TO GIVE THE DEPOSITARY
The Preferred Shareholder is required to give the Depositary the social
security number or employer identification number of the registered owner of the
Shares. If the Shares are in more than one name or are not in the name of the
actual owner, consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional guidance on which
number to report.
PAYER'S NAME: FIRST CHICAGO TRUST COMPANY OF NEW YORK
<TABLE>
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Part 1 -- PLEASE PROVIDE YOUR TIN IN THE Social Security Number OR
BOX AT RIGHT AND CERTIFY BY SIGNING AND Employer Identification Number
DATING BELOW. TIN ______________________________
---------------------------------------------------------------------------------------
SUBSTITUTE Name (Please Print) ____________________
Address ________________________________ Part 2 --
City ________ State _____ Zip Code _____ Awaiting TIN [ ]
---------------------------------------------------------------------------------------
FORM W-9 Part 3 -- CERTIFICATION -- UNDER PENALTIES OF PERJURY. I CERTIFY THAT: (1) the number
DEPARTMENT OF THE TREASURY shown on the form is my correct taxpayer identification number (or a TIN has not been
INTERNAL REVENUE SERVICE issued to me but I have mailed or delivered an application to receive a TIN or intend
to do so in the near future), (2) I am not subject to backup withholding either because
I have not been notified by the Internal Revenue Service (the "IRS") that I am subject
to backup withholding as a result of a failure to report all interest or dividends or
the IRS has notified me that I am no longer subject to backup withholding and (3) all
other information provided on this form is true, correct and complete.
SIGNATURE _______________________________________________DATE_____________________ 1997
You must cross out item (2) above if you have been notified by the IRS that you are
currently subject to backup withholding because of underreporting interest or dividends
on your tax return.
---------------------------------------------------------------------------------------
PAYER'S REQUEST FOR TAXPAYER NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31%
IDENTIFICATION NUMBER ("TIN") OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE ENCLOSED
AND CERTIFICATION GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9
FOR ADDITIONAL DETAILS. YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE
BOX IN PART 2 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has not been
issued to me and either (1) I have mailed or delivered an application to receive a
taxpayer identification number to the appropriate Internal Revenue Service Center or
Social Security Administration Office or (2) I intend to do so in the near future. I
understand that if I do not provide a taxpayer identification number by the time of
payment, 31% of all payments of the purchase price made to me will be withheld until I
provide a number.
SIGNATURE ___________________________________________ Date: _____________________ 1997.
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 50
THE DEALER MANAGERS:
<TABLE>
<S> <C>
MERRILL LYNCH & CO. SALOMON BROTHERS INC
World Financial Center Seven World Trade Center
250 Vesey Street New York, New York 10048
New York, New York 10281 Attn: Liability Management Department
(888) ML4-TNDR (toll free) (800) 558-3745 (toll free)
((888) 654-8637 (toll free))
</TABLE>
THE INFORMATION AGENT:
MORROW & CO., INC.
909 Third Avenue
New York, New York 10022-4799
(800) 566-9061 (call toll free)
(212) 754-8000
<PAGE> 51
6.02% OPCO
LETTER OF TRANSMITTAL
TO ACCOMPANY
SHARES OF 6.02% SERIES CUMULATIVE PREFERRED STOCK
CUSIP NUMBER 677415 81 2
OF
OHIO POWER COMPANY
TENDERED PURSUANT TO THE OFFER TO PURCHASE FOR CASH
BY
AMERICAN ELECTRIC POWER COMPANY, INC.
DATED JANUARY 30, 1997, FOR PURCHASE AT A
PURCHASE PRICE OF $103.71 PER SHARE
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON FRIDAY, FEBRUARY 28, 1997, UNLESS THE OFFER IS EXTENDED.
TO: FIRST CHICAGO TRUST COMPANY OF NEW YORK, DEPOSITARY
<TABLE>
<S> <C> <C>
BY MAIL: BY HAND: BY OVERNIGHT COURIER:
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
P.O. Box 2569 c/o The Depository Trust Company 14 Wall Street, 8th
Suite 4660 55 Water Street, DTC TAD Floor
Jersey City, NJ 07303-2569 Vietnam Veterans Memorial Plaza Suite 4680-OPCO
New York, NY 10041 New York, NY 10005
</TABLE>
AMERICAN ELECTRIC POWER COMPANY, INC. ("AEP") WILL NOT BE REQUIRED TO
ACCEPT FOR PAYMENT OR PAY FOR ANY SHARES TENDERED IF THE PROPOSED AMENDMENT IS
NOT APPROVED AND ADOPTED AT THE SPECIAL MEETING. PREFERRED SHAREHOLDERS OF
RECORD OF OHIO POWER COMPANY ("OPCO") HAVE THE RIGHT TO VOTE FOR OR AGAINST THE
PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES BY CASTING
THEIR VOTE AND SIGNING THE PROXY ENCLOSED HEREWITH OR BY VOTING IN PERSON AT THE
SPECIAL MEETING. IF THE PROPOSED AMENDMENT IS APPROVED AND ADOPTED BY OPCO'S
SHAREHOLDERS, OPCO WILL MAKE A SPECIAL CASH PAYMENT TO EACH PREFERRED
SHAREHOLDER WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT THEIR
SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
- --------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDERS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NOTE: IF SHARES ARE BEING TENDERED, THE REMAINDER OF THIS LETTER OF TRANSMITTAL
MUST BE COMPLETED, INCLUDING, IF APPLICABLE, THE SUBSTITUTE FORM W-9
BELOW.
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS LETTER OF
TRANSMITTAL IN THE APPROPRIATE SPACE THEREFOR PROVIDED AND, IF YOU ARE TENDERING
ANY SHARES, COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW OR A FORM W-8, AS
APPLICABLE. SEE INSTRUCTION 8 AND "IMPORTANT TAX INFORMATION" BELOW.
DO NOT SEND ANY CERTIFICATES TO MERRILL LYNCH & CO., SALOMON BROTHERS INC,
MORROW & CO., INC., AMERICAN ELECTRIC POWER COMPANY, INC. OR OHIO POWER COMPANY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED. QUESTIONS REGARDING
AND REQUESTS FOR COPIES OF THE OFFER TO PURCHASE AND PROXY STATEMENT OR THIS
LETTER OF TRANSMITTAL MAY BE DIRECTED TO MORROW & CO., INC., THE INFORMATION
AGENT, AT 909 THIRD AVENUE, NEW YORK, NEW YORK 10022-4799 OR TELEPHONE (800)
566-9061 (TOLL FREE).
<PAGE> 52
This Letter of Transmittal is to be used (a) if certificates are to be
forwarded to the First Chicago Trust Company of New York ("Depositary") or (b)
if delivery of tendered Shares (as defined below) is to be made by book-entry
transfer to the Depositary's account at The Depository Trust Company ("DTC") or
the Philadelphia Depository Trust Company ("PDTC") (hereinafter collectively
referred to as the "Book-Entry Transfer Facilities") pursuant to the procedures
set forth under the heading "Terms of the Offer -- Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement (as defined below).
Preferred Shareholders (as defined below) who wish to tender Shares but who
cannot deliver their Shares and all other documents required hereby to the
Depositary by the Expiration Date (as defined in the Offer to Purchase and Proxy
Statement) must tender their Shares pursuant to the guaranteed delivery
procedure set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. See Instruction
2. DELIVERY OF DOCUMENTS TO AEP, OPCO OR A BOOK-ENTRY TRANSFER FACILITY DOES NOT
CONSTITUTE A VALID DELIVERY.
- --------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
(IF TENDERING SHARES, PLEASE FILL IN EXACTLY AS INFORMATION APPEARS ON
CERTIFICATE(S))
(ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
TOTAL NUMBER OF SHARES
CERTIFICATE NUMBER(S)* REPRESENTED BY CERTIFICATE(S) NUMBER OF SHARES TENDERED**
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented by
any certificates delivered to the Depositary are being tendered. See
Instruction 4.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Depositary at 1-800-649-2153. In addition, you should
advise the Depositary of any certificate(s) you have in your possession. You
will need to complete an Affidavit of Loss with respect to the lost
certificate(s) (which will be provided by the Depositary) and pay an indemnity
bond premium fee.
(BOXES BELOW FOR USE BY ELIGIBLE INSTITUTIONS ONLY)
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
TO THE DEPOSITARY'S ACCOUNT AT A BOOK-ENTRY TRANSFER FACILITY AND
COMPLETE THE FOLLOWING:
Name of tendering institution
Account No.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO
A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE
DEPOSITARY AND COMPLETE THE FOLLOWING:
Name(s) of tendering shareholder(s)
Date of execution of Notice of Guaranteed Delivery
Name of institution that guaranteed delivery
If delivery is by book-entry transfer:
Name of tendering institution
Account no.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
<PAGE> 53
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to American Electric Power Company, Inc., a
New York corporation ("AEP"), the shares in the amount set forth in the box
above designated "Description of Shares Tendered" pursuant to AEP's offer to
purchase any and all of the outstanding shares of the series of cumulative
preferred stock of Ohio Power Company, an Ohio corporation, and direct utility
subsidiary of AEP ("OPCo"), shown on the first page hereof as to which this
Letter of Transmittal is applicable (the "Shares") at the purchase price per
Share shown on the first page hereof plus accrued and unpaid dividends thereon,
net to the seller in cash, upon the terms and subject to the conditions set
forth in the Offer to Purchase and Proxy Statement, dated January 30, 1997 (the
"Offer to Purchase and Proxy Statement"), receipt of which is hereby
acknowledged, and in this Letter of Transmittal (which as to the Shares,
together with the Offer to Purchase and Proxy Statement, constitutes the
"Offer"). WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT
TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S AMENDED
ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND PROXY
STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE PROPOSED
AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED IN THE
OFFER TO PURCHASE AND PROXY STATEMENT). See "Proposed Amendment and Proxy
Solicitation", "Terms of the Offer -- Extension of Tender Period; Termination;
Amendments" and "Terms of the Offer -- Certain Conditions of the Offer" in the
Offer to Purchase and Proxy Statement.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the undersigned hereby
sells, assigns and transfers to, or upon the order of, AEP all right, title and
interest in and to all the Shares that are being tendered hereby and hereby
constitutes and appoints First Chicago Trust Company of New York (the
"Depositary") the true and lawful agent and attorney-in-fact of the undersigned
with respect to such Shares, with full power of substitution (such power of
attorney being an irrevocable power coupled with an interest), to (a) deliver
certificates for such Shares, or transfer ownership of such Shares on the
account books maintained by the Book-Entry Transfer Facility that holds such
Shares, together, in any such case, with all accompanying evidences of transfer
and authenticity, to or upon the order of AEP, (b) present such Shares for
registration and transfer on the books of OPCo and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, all in
accordance with the terms of the Offer. The Depositary will act as agent for
tendering stockholders for the purpose of receiving payment from AEP and
transmitting payment to tendering stockholders.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Shares
tendered hereby and that, when and to the extent the same are accepted for
payment by AEP, AEP will acquire good, marketable and unencumbered title
thereto, free and clear of all liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the same will not be subject to any adverse claims. The
undersigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or AEP to be necessary or desirable to complete the
sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by, and shall survive the death, bankruptcy or incapacity of the
undersigned, and any obligations of the undersigned hereunder shall be binding
upon the heirs, legal representatives, successors, assigns, executors and
administrators of the undersigned. Except as stated in the Offer, this tender is
irrevocable.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and in the
instructions hereto will constitute the undersigned's acceptance of the terms
and conditions of the Offer, including the undersigned's representation and
warranty that (a) the undersigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (b) the tender of such Shares complies
with such Rule 14e-4. AEP's acceptance for payment of Shares tendered pursuant
to the Offer will constitute a binding agreement between the undersigned and AEP
upon the terms and subject to the conditions of the Offer.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase and Proxy Statement, AEP may terminate or amend the Offer
or may not be required to purchase any of the Shares tendered hereby. In either
event, the undersigned understands that certificate(s) for any Shares not
tendered or not purchased will be returned to the undersigned.
<PAGE> 54
Unless otherwise indicated in the box below under the heading "Special
Payment Instructions", please issue the check for the purchase price of any
Shares purchased, and/or return any Shares not tendered or not purchased, in the
name(s) of the undersigned (and, in the case of Shares tendered by book-entry
transfer, by credit to the account at the Book-Entry Transfer Facility
designated above). Similarly, unless otherwise indicated in the box below under
the heading "Special Delivery Instructions", please mail the check for the
purchase price of any Shares purchased and/or any certificates for Shares not
tendered or not purchased (and accompanying documents, as appropriate) to the
undersigned at the address shown below the undersigned signature(s). In the
event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any Shares purchased and/or return any Shares not tendered or not purchased in
the name(s) of, and mail said check and/or any certificates to, the person(s) so
indicated. The undersigned recognizes that AEP has no obligation, pursuant to
the "Special Payment Instructions", to transfer any Shares from the name of the
registered holder(s) thereof if AEP does not accept for payment any of the
Shares so tendered.
----------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 5 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be issued in the name of someone other than the undersigned.
Issue: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
-------------------------------------------------------
----------------------------------------------------------------
(INCLUDE ZIP CODE)
----------------------------------------------------------------
(TAXPAYER IDENTIFICATION OR
SOCIAL SECURITY NUMBER)
----------------------------------------------------------------
----------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 4 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be mailed to someone other than the undersigned or to the undersigned
at an address other than that shown below the undersigned's signature(s).
Mail: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
-------------------------------------------------------
----------------------------------------------------------------
(INCLUDE ZIP CODE)
----------------------------------------------------------------
----------------------------------------------------------------
SIGNATURE(S) OF OWNER(S)
X
- --------------------------------------------------------------------------------
X
- --------------------------------------------------------------------------------
Dated: ___________________________________________________________________, 1997
Name(s):
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title):
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.:
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on the
stock certificate(s) or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in a
fiduciary or representative capacity, please set forth full title and see
Instruction 5.)
<PAGE> 55
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5)
Authorized Signature:
Name:
Name of Firm:
Address of Firm:
Area Code and Telephone No.:
Dated: __________________________________________________________________, 1997
IF SHARES ARE BEING TENDERED, PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW OR
A FORM W-8, AS APPLICABLE.
SOLICITED TENDERS
(SEE INSTRUCTION 10)
As provided in Instruction 10, AEP will pay to any Soliciting Dealer, as
defined in Instruction 10, a solicitation fee of $.50 per Share for any Shares
tendered, accepted for payment and paid pursuant to the Offer. However,
Soliciting Dealers will not be entitled to a solicitation fee for Shares
beneficially owned by such Soliciting Dealer.
The abovesigned represents that the Soliciting Dealer which solicited and
obtained this tender is:
Name of Firm:
(PLEASE PRINT)
Name of Individual Broker
or Financial Consultant:
Telephone Number of Broker
or Financial Consultant:
Identification Number (if known):
Address:
(INCLUDE ZIP CODE)
The following to be completed ONLY if customer's Shares held in nominee
name are tendered.
<TABLE>
<CAPTION>
NAME OF BENEFICIAL OWNER NUMBER OF SHARES TENDERED
(ATTACH ADDITIONAL LIST IF NECESSARY)
<S> <C>
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
</TABLE>
The acceptance of compensation by such Soliciting Dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase and Proxy Statement; (c) in soliciting tenders of Shares, it
has used no solicitation materials other than those furnished by AEP; and (d) if
it is a foreign broker or dealer not eligible for membership in the National
Association of Securities Dealers, Inc. (the "NASD"), it has agreed to conform
to the NASD's Rules of Fair Practice in making solicitations.
The payment of compensation to any Soliciting Dealer is dependent on such
Soliciting Dealer returning a Notice of Solicited Tenders to the Depositary.
THIS LETTER OF TRANSMITTAL IS TO BE USED FOR THE TENDER OF SHARES OF THE
6.02% SERIES (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT) ONLY. ANY
PERSON DESIRING TO TENDER SHARES OF ANY OTHER SERIES OF CUMULATIVE PREFERRED
STOCK FOR WHICH AEP IS MAKING A TENDER OFFER MUST SUBMIT A LETTER OF TRANSMITTAL
RELATING TO THAT SPECIFIC SERIES.
<PAGE> 56
INSTRUCTIONS
FORMING PART OF THE
TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a firm that is a
member of a registered national securities exchange or the National Association
of Securities Dealers, Inc., or by a commercial bank or trust company having an
office or correspondent in the United States which is a participant in an
approved Medallion Signature Guarantee Program (each of the foregoing being
referred to as an "Eligible Institution"). Signatures on this Letter of
Transmittal need not be guaranteed (a) if this Letter of Transmittal is signed
by the registered holder(s) of the Shares (which term, for purposes of this
document, shall include any participant in one of the Book-Entry Transfer
Facilities whose name appears on a security position listing as the owner of
Shares) tendered herewith and such holder(s) has not completed the box above
under the heading "Special Payment Instructions" or the box above under the
heading "Special Delivery Instructions" on this Letter of Transmittal, or (b) if
such Shares are tendered for the account of an Eligible Institution. See
Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND SHARES. This Letter of
Transmittal is to be used if (a) certificates are to be forwarded herewith or,
(b) delivery of Shares is to be made by book-entry transfer pursuant to the
procedures set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. Certificates for
all physically delivered Shares, or a confirmation of a book-entry transfer into
the Depositary's account at one of the Book-Entry Transfer Facilities of all
Shares delivered electronically, as well as a properly completed and duly
executed Letter of Transmittal, and any other documents required by this Letter
of Transmittal, must be received by the Depositary at one of its addresses set
forth on the front page of this Letter of Transmittal on or prior to the
Expiration Date (as defined in the Offer to Purchase and Proxy Statement) with
respect to all Shares. Preferred Shareholders who wish to tender their Shares
yet who cannot deliver their Shares and all other required documents to the
Depositary on or prior to the Expiration Date must tender their Shares pursuant
to the guaranteed delivery procedure set forth under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement. Pursuant to such procedure: (a) such tender must be made by or
through an Eligible Institution, (b) a properly completed and duly executed
Notice of Guaranteed Delivery in the form provided by AEP (with any required
signature guarantees) must be received by the Depositary on or prior to the
applicable Expiration Date and (c) the certificates for all physically delivered
Shares, or a confirmation of a book-entry transfer into the Depositary's account
at one of the Book-Entry Transfer Facilities of all Shares delivered
electronically, together with a properly completed and duly executed Letter of
Transmittal and any other documents required by this Letter of Transmittal must
be received by the Depositary by 5:00 p.m. (New York City time) within three New
York Stock Exchange trading days after the date of execution of such Notice of
Guaranteed Delivery, all as provided under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF CERTIFICATES FOR
SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY
INSURED, IS RECOMMENDED.
No alternative, conditional or contingent tenders will be accepted. See
"Terms of the Offer -- Number of Shares; Purchase Prices; Expiration Date;
Dividends" in the Offer to Purchase and Proxy Statement. By executing this
Letter of Transmittal, the tendering stockholder waives any right to receive any
notice of the acceptance for payment of the Shares.
3. VOTING. WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES
PURSUANT TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S
AMENDED ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND
PROXY STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE
PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED
IN THE OFFER TO PURCHASE AND PROXY STATEMENT). In addition, Preferred
Shareholders have the right to vote for or against the Proposed Amendment
regardless of whether they tender their Shares by casting their vote and duly
executing the proxy enclosed herewith or by voting in person at the Special
Meeting. By executing a Notice of Guaranteed Delivery, a Preferred Shareholder
is deemed to have tendered the Shares described in such Notice of Guaranteed
Delivery and to have voted such Shares in accordance with the proxy returned
therewith, if any. If no vote is indicated on an otherwise properly executed
proxy, then all Shares in respect of such proxy will be voted in favor of the
Proposed Amendment. See "Proposed Amendment and Proxy Solicitation" in the Offer
to Purchase and Proxy Statement. The Offer is being sent to all persons in whose
names Shares are registered on the books of OPCo on the Record Date (as defined
in the Offer to Purchase and Proxy Statement) and transferees thereof. Only a
record holder of Shares on the Record Date may vote in person or by proxy at the
Special Meeting. No record date is fixed for determining which persons are
permitted to tender Shares. Any person who is the beneficial owner but not the
record holder of Shares must arrange for the record transfer of such Shares
prior to tendering.
4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the Shares represented by any
certificate delivered to the Depositary are to be tendered, fill in the number
of Shares that are to be tendered in the box above under the heading
"Description of Shares Tendered". In such case, a new certificate for the
remainder of the Shares represented by the old certificate will be sent to the
person(s) signing this Letter of Transmittal, unless otherwise provided in the
box above under the heading "Special Payment Instructions" or "Special Delivery
Instructions", as promptly as practicable following the expiration or
termination of the Offer. All Shares represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise indicated.
<PAGE> 57
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL AND/OR NOTICE OF GUARANTEED
DELIVERY; STOCK POWERS AND ENDORSEMENTS. If either this Letter of Transmittal
or the Notice of Guaranteed Delivery (together, the "Tender Documents") is
signed by the registered holder(s) of the Shares tendered hereby, the
signature(s) must correspond with the name(s) as written on the face of the
certificates without alteration, enlargement or any change whatsoever.
If any of the Shares tendered under either Tender Document is held of
record by two or more persons, all such persons must sign such Tender Document.
If any of the Shares tendered under either Tender Document is registered in
different names or different certificates, it will be necessary to complete,
sign and submit as many separate applicable Tender Documents as there are
different registrations or certificates.
If either Tender Document is signed by the registered holder(s) of the
Shares tendered hereby, no endorsements of certificates or separate stock powers
are required unless payment of the purchase price is to be made to, or Shares
not tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s). Signatures on any such certificates or
stock powers must be guaranteed by an Eligible Institution. See Instruction 1.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates must be
endorsed or accompanied by appropriate stock powers, in either case, signed
exactly as the name(s) of the registered holder(s) appear(s) on the certificates
for such Shares. Signature(s) on any such certificates or stock powers must be
guaranteed by an Eligible Institution. See Instruction 1.
If either Tender Document or any certificate or stock power is signed by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
AEP of the authority of such person so to act must be submitted.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, AEP
will pay or cause to be paid any stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price is to be made to, or Shares not tendered
or not purchased are to be registered in the name of, any person other than the
registered holder(s), or if tendered Shares are registered in the name of any
person other than the person(s) signing this Letter of Transmittal, the amount
of any stock transfer taxes (whether imposed on the registered holder(s), such
other person or otherwise) payable on account of the transfer to such person
will be deducted from the purchase price unless satisfactory evidence of the
payment of such taxes, or exemption therefrom, is submitted. See "Terms of the
Offer -- Acceptance of Shares for Payment and Payment of Purchase Price and
Dividends" in the Offer to Purchase and Proxy Statement. EXCEPT AS PROVIDED IN
THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE
CERTIFICATES REPRESENTING SHARES TENDERED HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any Shares purchased is to be issued in the name of, and/or
any Shares not tendered or not purchased are to be returned to, a person other
than the person(s) signing this Letter of Transmittal or if the check and/or any
certificate for Shares not tendered or not purchased are to be mailed to someone
other than the person(s) signing this Letter of Transmittal or to an address
other than that shown in the box above under the heading "Name(s) and
Address(es) of Registered Holder(s)", then the "Special Payment Instructions"
and/or "Special Delivery Instructions" on this Letter of Transmittal should be
completed. Preferred Shareholders tendering Shares by book-entry transfer will
have any Shares not accepted for payment returned by crediting the account
maintained by such Preferred Shareholder at the Book-Entry Transfer Facility
from which such transfer was made.
8. SUBSTITUTE FORM W-9 AND FORM W-8. The tendering Preferred Shareholder
is required to provide the Depositary with either a correct Taxpayer
Identification Number ("TIN") on Substitute Form W-9, which is provided under
"Important Tax Information" below, or a properly completed Form W-8. Failure to
provide the information on either Substitute Form W-9 or Form W-8 may subject
the tendering Preferred Shareholder to a $50 penalty imposed by the Internal
Revenue Service and to 31% federal income tax backup withholding on the payment
of the purchase price for the Shares. The box in Part 2 of Substitute Form W-9
may be checked if the tendering Preferred Shareholder has not been issued a TIN
and has applied for a number or intends to apply for a number in the near
future. If the box in Part 2 is checked and the Depositary is not provided with
a TIN by the time of payment, the Depositary will withhold 31% on all payments
of the purchase price for the Shares thereafter until a TIN is provided to the
Depositary.
9. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Any questions or
requests for assistance may be directed to the Information Agent or the Dealer
Managers at their respective telephone numbers and addresses listed below.
Requests for additional copies of the Offer to Purchase and Proxy Statement,
this Letter of Transmittal or other tender offer materials may be directed to
the Information Agent and such copies will be furnished promptly at AEP's
expense. Preferred Shareholders may also contact their local broker, dealer,
commercial bank or trust company for assistance concerning the Offer.
<PAGE> 58
10. SOLICITED TENDERS. AEP will pay a solicitation fee of $.50 per Share
for any Shares tendered, accepted for payment and paid pursuant to the Offer,
covered by the Letter of Transmittal which designates, under the heading
"Solicited Tenders", as having solicited and obtained the tender, the name of
(a) any broker or dealer in securities, including a Dealer Manager in its
capacity as a dealer or broker, which is a member of any national securities
exchange or of the National Association of Securities Dealers, Inc. (the
"NASD"), (b) any foreign broker or dealer not eligible for membership in the
NASD which agrees to conform to the NASD's Rules of Fair Practice in soliciting
tenders outside the United States to the same extent as though it were an NASD
member, or (c) any bank or trust company (each of which is referred to herein as
a "Soliciting Dealer"). No such fee shall be payable to a Soliciting Dealer with
respect to the tender of Shares by a holder unless the Letter of Transmittal
accompanying such tender designates such Soliciting Dealer. No such fee shall be
payable to a Soliciting Dealer in respect of Shares registered in the name of
such Soliciting Dealer unless such Shares are held by such Soliciting Dealer as
nominee and such Shares are being tendered for the benefit of one or more
beneficial owners identified on the Letter of Transmittal or on the Notice of
Solicited Tenders (included in the materials provided to brokers and dealers).
No such fee shall be payable to a Soliciting Dealer with respect to the tender
of Shares by the holder of record, for the benefit of the beneficial owner,
unless the beneficial owner has designated such Soliciting Dealer. If tendered
Shares are being delivered by book-entry transfer, the Soliciting Dealer must
return a Notice of Solicited Tenders to the Depositary within three business
days after expiration of the Offer to receive a solicitation fee. No such fee
shall be payable to a Soliciting Dealer if such Soliciting Dealer is required
for any reason to transfer the amount of such fee to a depositing holder (other
than itself). No such fee shall be paid to a Soliciting Dealer with respect to
Shares tendered for such Soliciting Dealer's own account. No broker, dealer,
bank, trust company or fiduciary shall be deemed to be the agent of AEP, the
Depositary, the Information Agent or the Dealer Managers for purposes of the
Offer.
Soliciting Dealers will include any organizations described in clauses (a),
(b) or (c) above even when the activities of such organization in connection
with the Offer consist solely of forwarding to clients materials relating to the
Offer, including this Letter of Transmittal, and rendering Shares as directed by
beneficial owners thereof. No Soliciting Dealer is required to make any
recommendation to holders of Shares as to whether to tender or refrain from
tendering in the Offer. No assumption is made, in making payment to any
Soliciting Dealer, that its activities in connection with the Offer included any
activities other than those described above, and for all purposes noted in all
materials relating to the Offer, the term "solicit" shall be deemed to mean no
more than "processing shares tendered" or "forwarding to customers materials
regarding the Offer."
11. IRREGULARITIES. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance of any tender
of Shares will be determined by AEP, in its sole discretion, and its
determination shall be final and binding. AEP reserves the absolute right to
reject any and all tenders of Shares that it determines are not in proper form
or the acceptance for payment of or payment for Shares that may, in the opinion
of AEP's counsel, be unlawful. AEP also reserves the absolute right to waive any
of the conditions to the Offer or any defect or irregularity in any tender of
Shares and AEP's interpretation of the terms and conditions of the Offer
(including these instructions) shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as AEP shall determine. None of AEP, OPCo, the Dealer Managers, the
Depositary, the Information Agent or any other person shall be under any duty to
give notice of any defect or irregularity in tenders, nor shall any of them
incur any liability for failure to give any such notice. Tenders will not be
deemed to have been made until all defects and irregularities have been cured or
waived.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any of your certificate(s)
for Shares have been lost, stolen or destroyed, please call the Depositary at
1-800-649-2153. In addition, you should advise the Depositary of any
certificate(s) you have in your possession. You will need to complete an
Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by the Depositary) and pay an indemnity bond premium fee. The tender of
Shares pursuant to this Letter of Transmittal will not be valid unless prior to
the Expiration Date: (a) such procedures have been completed and a replacement
certificate for the Shares has been delivered to the Depositary or (b) a Notice
of Guaranteed Delivery has been delivered to the Depositary. See Instruction 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL, DULY EXECUTED, TOGETHER WITH, IF
APPLICABLE, CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER, AND ALL OTHER
REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR, IF APPLICABLE, THE
NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY, ON OR PRIOR TO
THE APPLICABLE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under federal income tax law, a Preferred Shareholder whose tendered Shares
are accepted for payment is required to provide the Depositary (as payer) with
either such Preferred Shareholder's correct TIN on Substitute Form W-9 below or
a properly completed Form W-8. If such Preferred Shareholder is an individual,
the TIN is his or her social security number. For businesses and other entities,
the number is the federal employer identification number. If the Depositary is
not provided with the correct TIN or properly completed Form W-8, the Preferred
Shareholder may be subject to a $50 penalty imposed by the Internal Revenue
Code. In addition, payments that are made to such Preferred Shareholder with
respect to Shares purchased pursuant to the Offer may be subject to 31% backup
withholding.
<PAGE> 59
Certain Preferred Shareholders (including, among others, all corporations
and certain foreign individuals) are exempt from backup withholding. For a
corporate United States Preferred Shareholder to qualify for such exemption,
such Preferred Shareholder must provide the Depositary with a properly completed
and executed Substitute Form W-9 attesting to its exempt status. In order for a
foreign Preferred Shareholder to qualify as an exempt recipient, such Preferred
Shareholder must submit to the Depositary a properly completed Internal Revenue
Service Form W-8 (a "Form W-8"), signed under penalties of perjury, attesting to
that Preferred Shareholder's exempt status. A Form W-8 can be obtained from the
Depositary. See the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional instructions.
If federal income tax backup withholding applies, the Depositary is
required to withhold 31% of any payments made to the Preferred Shareholder.
Backup withholding is not an additional tax. Rather, the Federal income tax
liability of persons subject to backup withholding will be reduced by the amount
of the tax withheld. If withholding results in an overpayment of taxes, a refund
may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on payments that are made to a Preferred
Shareholder with respect to Shares purchased pursuant to the Offer, the
Preferred Shareholder is required to notify the Depositary of his or her correct
TIN by completing the Substitute Form W-9 attached hereto certifying that the
TIN provided on Substitute Form W-9 is correct and that (a) the Preferred
Shareholder has not been notified by the Internal Revenue Service that he or she
is subject to federal income tax backup withholding as a result of failure to
report all interest or dividends or (b) the Internal Revenue Service has
notified the Preferred Shareholder that he or she is no longer subject to
federal income tax backup withholding. Foreign Preferred Shareholders must
submit a properly completed Form W-8 in order to avoid the applicable backup
withholding.
WHAT NUMBER TO GIVE THE DEPOSITARY
The Preferred Shareholder is required to give the Depositary the social
security number or employer identification number of the registered owner of the
Shares. If the Shares are in more than one name or are not in the name of the
actual owner, consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional guidance on which
number to report.
PAYER'S NAME: FIRST CHICAGO TRUST COMPANY OF NEW YORK
<TABLE>
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<S> <C>
Part 1 -- PLEASE PROVIDE YOUR TIN IN THE Social Security Number OR
BOX AT RIGHT AND CERTIFY BY SIGNING AND Employer Identification Number
DATING BELOW. TIN ______________________________
----------------------------------------------------------------------------------------
SUBSTITUTE Name (Please Print) ____________________
Address ________________________________ Part 2 --
City ________ State _____ Zip Code _____ Awaiting TIN [ ]
----------------------------------------------------------------------------------------
FORM W-9 Part 3 -- CERTIFICATION -- UNDER PENALTIES OF PERJURY. I CERTIFY THAT: (1) the number
DEPARTMENT OF THE TREASURY shown on the form is my correct taxpayer identification number (or a TIN has not been
INTERNAL REVENUE SERVICE issued to me but I have mailed or delivered an application to receive a TIN or intend
to do so in the near future), (2) I am not subject to backup withholding either because
I have not been notified by the Internal Revenue Service (the "IRS") that I am subject
to backup withholding as a result of a failure to report all interest or dividends or
the IRS has notified me that I am no longer subject to backup withholding and (3) all
other information provided on this form is true, correct and complete.
SIGNATURE _______________________________________________DATE_____________________ 1997
You must cross out item (2) above if you have been notified by the IRS that you are
currently subject to backup withholding because of underreporting interest or dividends
on your tax return.
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PAYER'S REQUEST FOR TAXPAYER NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31%
IDENTIFICATION NUMBER ("TIN") OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE ENCLOSED
AND CERTIFICATION GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9
FOR ADDITIONAL DETAILS. YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE
BOX IN PART 2 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has not been
issued to me and either (1) I have mailed or delivered an application to receive a
taxpayer identification number to the appropriate Internal Revenue Service Center or
Social Security Administration Office or (2) I intend to do so in the near future. I
understand that if I do not provide a taxpayer identification number by the time of
payment, 31% of all payments of the purchase price made to me will be withheld until I
provide a number.
SIGNATURE ___________________________________________ Date: _____________________ 1997.
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 60
THE DEALER MANAGERS:
<TABLE>
<S> <C>
MERRILL LYNCH & CO. SALOMON BROTHERS INC
World Financial Center Seven World Trade Center
250 Vesey Street New York, New York 10048
New York, New York 10281 Attn: Liability Management Department
(888) ML4-TNDR (toll free) (800) 558-3745 (toll free)
((888) 654-8637 (toll free))
</TABLE>
THE INFORMATION AGENT:
MORROW & CO., INC.
909 Third Avenue
New York, New York 10022-4799
(800) 566-9061 (call toll free)
(212) 754-8000
<PAGE> 61
6.35% OPCO
LETTER OF TRANSMITTAL
TO ACCOMPANY
SHARES OF 6.35% SERIES CUMULATIVE PREFERRED STOCK
CUSIP NUMBER 677415 82 0
OF
OHIO POWER COMPANY
TENDERED PURSUANT TO THE OFFER TO PURCHASE FOR CASH
BY
AMERICAN ELECTRIC POWER COMPANY, INC.
DATED JANUARY 30, 1997, FOR PURCHASE AT A
PURCHASE PRICE OF $105.14 PER SHARE
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON FRIDAY, FEBRUARY 28, 1997, UNLESS THE OFFER IS EXTENDED.
TO: FIRST CHICAGO TRUST COMPANY OF NEW YORK, DEPOSITARY
<TABLE>
<S> <C> <C>
BY MAIL: BY HAND: BY OVERNIGHT COURIER:
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
P.O. Box 2569 c/o The Depository Trust Company 14 Wall Street, 8th
Suite 4660 55 Water Street, DTC TAD Floor
Jersey City, NJ 07303-2569 Vietnam Veterans Memorial Plaza Suite 4680-OPCO
New York, NY 10041 New York, NY 10005
</TABLE>
AMERICAN ELECTRIC POWER COMPANY, INC. ("AEP") WILL NOT BE REQUIRED TO
ACCEPT FOR PAYMENT OR PAY FOR ANY SHARES TENDERED IF THE PROPOSED AMENDMENT IS
NOT APPROVED AND ADOPTED AT THE SPECIAL MEETING. PREFERRED SHAREHOLDERS OF
RECORD OF OHIO POWER COMPANY ("OPCO") HAVE THE RIGHT TO VOTE FOR OR AGAINST THE
PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES BY CASTING
THEIR VOTE AND SIGNING THE PROXY ENCLOSED HEREWITH OR BY VOTING IN PERSON AT THE
SPECIAL MEETING. IF THE PROPOSED AMENDMENT IS APPROVED AND ADOPTED BY OPCO'S
SHAREHOLDERS, OPCO WILL MAKE A SPECIAL CASH PAYMENT TO EACH PREFERRED
SHAREHOLDER WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT THEIR
SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
- --------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDERS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NOTE: IF SHARES ARE BEING TENDERED, THE REMAINDER OF THIS LETTER OF TRANSMITTAL
MUST BE COMPLETED, INCLUDING, IF APPLICABLE, THE SUBSTITUTE FORM W-9
BELOW.
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS LETTER OF
TRANSMITTAL IN THE APPROPRIATE SPACE THEREFOR PROVIDED AND, IF YOU ARE TENDERING
ANY SHARES, COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW OR A FORM W-8, AS
APPLICABLE. SEE INSTRUCTION 8 AND "IMPORTANT TAX INFORMATION" BELOW.
DO NOT SEND ANY CERTIFICATES TO MERRILL LYNCH & CO., SALOMON BROTHERS INC,
MORROW & CO., INC., AMERICAN ELECTRIC POWER COMPANY, INC. OR OHIO POWER COMPANY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED. QUESTIONS REGARDING
AND REQUESTS FOR COPIES OF THE OFFER TO PURCHASE AND PROXY STATEMENT OR THIS
LETTER OF TRANSMITTAL MAY BE DIRECTED TO MORROW & CO., INC., THE INFORMATION
AGENT, AT 909 THIRD AVENUE, NEW YORK, NEW YORK 10022-4799 OR TELEPHONE (800)
566-9061 (TOLL FREE).
<PAGE> 62
This Letter of Transmittal is to be used (a) if certificates are to be
forwarded to the First Chicago Trust Company of New York ("Depositary") or (b)
if delivery of tendered Shares (as defined below) is to be made by book-entry
transfer to the Depositary's account at The Depository Trust Company ("DTC") or
the Philadelphia Depository Trust Company ("PDTC") (hereinafter collectively
referred to as the "Book-Entry Transfer Facilities") pursuant to the procedures
set forth under the heading "Terms of the Offer -- Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement (as defined below).
Preferred Shareholders (as defined below) who wish to tender Shares but who
cannot deliver their Shares and all other documents required hereby to the
Depositary by the Expiration Date (as defined in the Offer to Purchase and Proxy
Statement) must tender their Shares pursuant to the guaranteed delivery
procedure set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. See Instruction
2. DELIVERY OF DOCUMENTS TO AEP, OPCO OR A BOOK-ENTRY TRANSFER FACILITY DOES NOT
CONSTITUTE A VALID DELIVERY.
- --------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
(IF TENDERING SHARES, PLEASE FILL IN EXACTLY AS INFORMATION APPEARS ON
CERTIFICATE(S))
(ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
TOTAL NUMBER OF SHARES
CERTIFICATE NUMBER(S)* REPRESENTED BY CERTIFICATE(S) NUMBER OF SHARES TENDERED**
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented by
any certificates delivered to the Depositary are being tendered. See
Instruction 4.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Depositary at 1-800-649-2153. In addition, you should
advise the Depositary of any certificate(s) you have in your possession. You
will need to complete an Affidavit of Loss with respect to the lost
certificate(s) (which will be provided by the Depositary) and pay an indemnity
bond premium fee.
(BOXES BELOW FOR USE BY ELIGIBLE INSTITUTIONS ONLY)
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
TO THE DEPOSITARY'S ACCOUNT AT A BOOK-ENTRY TRANSFER FACILITY AND
COMPLETE THE FOLLOWING:
Name of tendering institution
Account No.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO
A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE
DEPOSITARY AND COMPLETE THE FOLLOWING:
Name(s) of tendering shareholder(s)
Date of execution of Notice of Guaranteed Delivery
Name of institution that guaranteed delivery
If delivery is by book-entry transfer:
Name of tendering institution
Account no.
Transaction Code No.
Check Applicable Box: [ ] DTC [ ] PDTC
<PAGE> 63
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to American Electric Power Company, Inc., a
New York corporation ("AEP"), the shares in the amount set forth in the box
above designated "Description of Shares Tendered" pursuant to AEP's offer to
purchase any and all of the outstanding shares of the series of cumulative
preferred stock of Ohio Power Company, an Ohio corporation, and direct utility
subsidiary of AEP ("OPCo"), shown on the first page hereof as to which this
Letter of Transmittal is applicable (the "Shares") at the purchase price per
Share shown on the first page hereof plus accrued and unpaid dividends thereon,
net to the seller in cash, upon the terms and subject to the conditions set
forth in the Offer to Purchase and Proxy Statement, dated January 30, 1997 (the
"Offer to Purchase and Proxy Statement"), receipt of which is hereby
acknowledged, and in this Letter of Transmittal (which as to the Shares,
together with the Offer to Purchase and Proxy Statement, constitutes the
"Offer"). WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT
TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S AMENDED
ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND PROXY
STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE PROPOSED
AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED IN THE
OFFER TO PURCHASE AND PROXY STATEMENT). See "Proposed Amendment and Proxy
Solicitation", "Terms of the Offer -- Extension of Tender Period; Termination;
Amendments" and "Terms of the Offer -- Certain Conditions of the Offer" in the
Offer to Purchase and Proxy Statement.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the undersigned hereby
sells, assigns and transfers to, or upon the order of, AEP all right, title and
interest in and to all the Shares that are being tendered hereby and hereby
constitutes and appoints First Chicago Trust Company of New York (the
"Depositary") the true and lawful agent and attorney-in-fact of the undersigned
with respect to such Shares, with full power of substitution (such power of
attorney being an irrevocable power coupled with an interest), to (a) deliver
certificates for such Shares, or transfer ownership of such Shares on the
account books maintained by the Book-Entry Transfer Facility that holds such
Shares, together, in any such case, with all accompanying evidences of transfer
and authenticity, to or upon the order of AEP, (b) present such Shares for
registration and transfer on the books of OPCo and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, all in
accordance with the terms of the Offer. The Depositary will act as agent for
tendering stockholders for the purpose of receiving payment from AEP and
transmitting payment to tendering stockholders.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Shares
tendered hereby and that, when and to the extent the same are accepted for
payment by AEP, AEP will acquire good, marketable and unencumbered title
thereto, free and clear of all liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the same will not be subject to any adverse claims. The
undersigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or AEP to be necessary or desirable to complete the
sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by, and shall survive the death, bankruptcy or incapacity of the
undersigned, and any obligations of the undersigned hereunder shall be binding
upon the heirs, legal representatives, successors, assigns, executors and
administrators of the undersigned. Except as stated in the Offer, this tender is
irrevocable.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and in the
instructions hereto will constitute the undersigned's acceptance of the terms
and conditions of the Offer, including the undersigned's representation and
warranty that (a) the undersigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (b) the tender of such Shares complies
with such Rule 14e-4. AEP's acceptance for payment of Shares tendered pursuant
to the Offer will constitute a binding agreement between the undersigned and AEP
upon the terms and subject to the conditions of the Offer.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase and Proxy Statement, AEP may terminate or amend the Offer
or may not be required to purchase any of the Shares tendered hereby. In either
event, the undersigned understands that certificate(s) for any Shares not
tendered or not purchased will be returned to the undersigned.
<PAGE> 64
Unless otherwise indicated in the box below under the heading "Special
Payment Instructions", please issue the check for the purchase price of any
Shares purchased, and/or return any Shares not tendered or not purchased, in the
name(s) of the undersigned (and, in the case of Shares tendered by book-entry
transfer, by credit to the account at the Book-Entry Transfer Facility
designated above). Similarly, unless otherwise indicated in the box below under
the heading "Special Delivery Instructions", please mail the check for the
purchase price of any Shares purchased and/or any certificates for Shares not
tendered or not purchased (and accompanying documents, as appropriate) to the
undersigned at the address shown below the undersigned signature(s). In the
event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any Shares purchased and/or return any Shares not tendered or not purchased in
the name(s) of, and mail said check and/or any certificates to, the person(s) so
indicated. The undersigned recognizes that AEP has no obligation, pursuant to
the "Special Payment Instructions", to transfer any Shares from the name of the
registered holder(s) thereof if AEP does not accept for payment any of the
Shares so tendered.
----------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 5 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be issued in the name of someone other than the undersigned.
Issue: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
-------------------------------------------------------
----------------------------------------------------------------
(INCLUDE ZIP CODE)
----------------------------------------------------------------
(TAXPAYER IDENTIFICATION OR
SOCIAL SECURITY NUMBER)
----------------------------------------------------------------
----------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 4 AND 7)
To be completed ONLY if the check for the purchase price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be mailed to someone other than the undersigned or to the undersigned
at an address other than that shown below the undersigned's signature(s).
Mail: [ ] check and/or
[ ] certificate(s) to:
Name
---------------------------------------------------------
(PLEASE PRINT)
Address
-------------------------------------------------------
----------------------------------------------------------------
(INCLUDE ZIP CODE)
----------------------------------------------------------------
----------------------------------------------------------------
SIGNATURE(S) OF OWNER(S)
X
- --------------------------------------------------------------------------------
X
- --------------------------------------------------------------------------------
Dated: ___________________________________________________________________, 1997
Name(s):
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title):
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.:
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on the
stock certificate(s) or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in a
fiduciary or representative capacity, please set forth full title and see
Instruction 5.)
<PAGE> 65
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5)
Authorized Signature:
Name:
Name of Firm:
Address of Firm:
Area Code and Telephone No.:
Dated: __________________________________________________________________, 1997
IF SHARES ARE BEING TENDERED, PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW OR
A FORM W-8, AS APPLICABLE.
SOLICITED TENDERS
(SEE INSTRUCTION 10)
As provided in Instruction 10, AEP will pay to any Soliciting Dealer, as
defined in Instruction 10, a solicitation fee of $.50 per Share for any Shares
tendered, accepted for payment and paid pursuant to the Offer. However,
Soliciting Dealers will not be entitled to a solicitation fee for Shares
beneficially owned by such Soliciting Dealer.
The abovesigned represents that the Soliciting Dealer which solicited and
obtained this tender is:
Name of Firm:
(PLEASE PRINT)
Name of Individual Broker
or Financial Consultant:
Telephone Number of Broker
or Financial Consultant:
Identification Number (if known):
Address:
(INCLUDE ZIP CODE)
The following to be completed ONLY if customer's Shares held in nominee
name are tendered.
<TABLE>
<CAPTION>
NAME OF BENEFICIAL OWNER NUMBER OF SHARES TENDERED
(ATTACH ADDITIONAL LIST IF NECESSARY)
<S> <C>
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
- --------------------------------------------- ---------------------------------------------
</TABLE>
The acceptance of compensation by such Soliciting Dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase and Proxy Statement; (c) in soliciting tenders of Shares, it
has used no solicitation materials other than those furnished by AEP; and (d) if
it is a foreign broker or dealer not eligible for membership in the National
Association of Securities Dealers, Inc. (the "NASD"), it has agreed to conform
to the NASD's Rules of Fair Practice in making solicitations.
The payment of compensation to any Soliciting Dealer is dependent on such
Soliciting Dealer returning a Notice of Solicited Tenders to the Depositary.
THIS LETTER OF TRANSMITTAL IS TO BE USED FOR THE TENDER OF SHARES OF THE
6.35% SERIES (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT) ONLY. ANY
PERSON DESIRING TO TENDER SHARES OF ANY OTHER SERIES OF CUMULATIVE PREFERRED
STOCK FOR WHICH AEP IS MAKING A TENDER OFFER MUST SUBMIT A LETTER OF TRANSMITTAL
RELATING TO THAT SPECIFIC SERIES.
<PAGE> 66
INSTRUCTIONS
FORMING PART OF THE
TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a firm that is a
member of a registered national securities exchange or the National Association
of Securities Dealers, Inc., or by a commercial bank or trust company having an
office or correspondent in the United States which is a participant in an
approved Medallion Signature Guarantee Program (each of the foregoing being
referred to as an "Eligible Institution"). Signatures on this Letter of
Transmittal need not be guaranteed (a) if this Letter of Transmittal is signed
by the registered holder(s) of the Shares (which term, for purposes of this
document, shall include any participant in one of the Book-Entry Transfer
Facilities whose name appears on a security position listing as the owner of
Shares) tendered herewith and such holder(s) has not completed the box above
under the heading "Special Payment Instructions" or the box above under the
heading "Special Delivery Instructions" on this Letter of Transmittal, or (b) if
such Shares are tendered for the account of an Eligible Institution. See
Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND SHARES. This Letter of
Transmittal is to be used if (a) certificates are to be forwarded herewith or,
(b) delivery of Shares is to be made by book-entry transfer pursuant to the
procedures set forth under the heading "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. Certificates for
all physically delivered Shares, or a confirmation of a book-entry transfer into
the Depositary's account at one of the Book-Entry Transfer Facilities of all
Shares delivered electronically, as well as a properly completed and duly
executed Letter of Transmittal, and any other documents required by this Letter
of Transmittal, must be received by the Depositary at one of its addresses set
forth on the front page of this Letter of Transmittal on or prior to the
Expiration Date (as defined in the Offer to Purchase and Proxy Statement) with
respect to all Shares. Preferred Shareholders who wish to tender their Shares
yet who cannot deliver their Shares and all other required documents to the
Depositary on or prior to the Expiration Date must tender their Shares pursuant
to the guaranteed delivery procedure set forth under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement. Pursuant to such procedure: (a) such tender must be made by or
through an Eligible Institution, (b) a properly completed and duly executed
Notice of Guaranteed Delivery in the form provided by AEP (with any required
signature guarantees) must be received by the Depositary on or prior to the
applicable Expiration Date and (c) the certificates for all physically delivered
Shares, or a confirmation of a book-entry transfer into the Depositary's account
at one of the Book-Entry Transfer Facilities of all Shares delivered
electronically, together with a properly completed and duly executed Letter of
Transmittal and any other documents required by this Letter of Transmittal must
be received by the Depositary by 5:00 p.m. (New York City time) within three New
York Stock Exchange trading days after the date of execution of such Notice of
Guaranteed Delivery, all as provided under the heading "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF CERTIFICATES FOR
SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY
INSURED, IS RECOMMENDED.
No alternative, conditional or contingent tenders will be accepted. See
"Terms of the Offer -- Number of Shares; Purchase Prices; Expiration Date;
Dividends" in the Offer to Purchase and Proxy Statement. By executing this
Letter of Transmittal, the tendering stockholder waives any right to receive any
notice of the acceptance for payment of the Shares.
3. VOTING. WHILE PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES
PURSUANT TO THE OFFER NEED NOT VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S
AMENDED ARTICLES OF INCORPORATION, AS SET FORTH IN THE OFFER TO PURCHASE AND
PROXY STATEMENT (THE "PROPOSED AMENDMENT"), THE OFFER IS CONDITIONED UPON THE
PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED
IN THE OFFER TO PURCHASE AND PROXY STATEMENT). In addition, Preferred
Shareholders have the right to vote for or against the Proposed Amendment
regardless of whether they tender their Shares by casting their vote and duly
executing the proxy enclosed herewith or by voting in person at the Special
Meeting. By executing a Notice of Guaranteed Delivery, a Preferred Shareholder
is deemed to have tendered the Shares described in such Notice of Guaranteed
Delivery and to have voted such Shares in accordance with the proxy returned
therewith, if any. If no vote is indicated on an otherwise properly executed
proxy, then all Shares in respect of such proxy will be voted in favor of the
Proposed Amendment. See "Proposed Amendment and Proxy Solicitation" in the Offer
to Purchase and Proxy Statement. The Offer is being sent to all persons in whose
names Shares are registered on the books of OPCo on the Record Date (as defined
in the Offer to Purchase and Proxy Statement) and transferees thereof. Only a
record holder of Shares on the Record Date may vote in person or by proxy at the
Special Meeting. No record date is fixed for determining which persons are
permitted to tender Shares. Any person who is the beneficial owner but not the
record holder of Shares must arrange for the record transfer of such Shares
prior to tendering.
4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the Shares represented by any
certificate delivered to the Depositary are to be tendered, fill in the number
of Shares that are to be tendered in the box above under the heading
"Description of Shares Tendered". In such case, a new certificate for the
remainder of the Shares represented by the old certificate will be sent to the
person(s) signing this Letter of Transmittal, unless otherwise provided in the
box above under the heading "Special Payment Instructions" or "Special Delivery
Instructions", as promptly as practicable following the expiration or
termination of the Offer. All Shares represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise indicated.
<PAGE> 67
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL AND/OR NOTICE OF GUARANTEED
DELIVERY; STOCK POWERS AND ENDORSEMENTS. If either this Letter of Transmittal
or the Notice of Guaranteed Delivery (together, the "Tender Documents") is
signed by the registered holder(s) of the Shares tendered hereby, the
signature(s) must correspond with the name(s) as written on the face of the
certificates without alteration, enlargement or any change whatsoever.
If any of the Shares tendered under either Tender Document is held of
record by two or more persons, all such persons must sign such Tender Document.
If any of the Shares tendered under either Tender Document is registered in
different names or different certificates, it will be necessary to complete,
sign and submit as many separate applicable Tender Documents as there are
different registrations or certificates.
If either Tender Document is signed by the registered holder(s) of the
Shares tendered hereby, no endorsements of certificates or separate stock powers
are required unless payment of the purchase price is to be made to, or Shares
not tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s). Signatures on any such certificates or
stock powers must be guaranteed by an Eligible Institution. See Instruction 1.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates must be
endorsed or accompanied by appropriate stock powers, in either case, signed
exactly as the name(s) of the registered holder(s) appear(s) on the certificates
for such Shares. Signature(s) on any such certificates or stock powers must be
guaranteed by an Eligible Institution. See Instruction 1.
If either Tender Document or any certificate or stock power is signed by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
AEP of the authority of such person so to act must be submitted.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, AEP
will pay or cause to be paid any stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price is to be made to, or Shares not tendered
or not purchased are to be registered in the name of, any person other than the
registered holder(s), or if tendered Shares are registered in the name of any
person other than the person(s) signing this Letter of Transmittal, the amount
of any stock transfer taxes (whether imposed on the registered holder(s), such
other person or otherwise) payable on account of the transfer to such person
will be deducted from the purchase price unless satisfactory evidence of the
payment of such taxes, or exemption therefrom, is submitted. See "Terms of the
Offer -- Acceptance of Shares for Payment and Payment of Purchase Price and
Dividends" in the Offer to Purchase and Proxy Statement. EXCEPT AS PROVIDED IN
THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE
CERTIFICATES REPRESENTING SHARES TENDERED HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any Shares purchased is to be issued in the name of, and/or
any Shares not tendered or not purchased are to be returned to, a person other
than the person(s) signing this Letter of Transmittal or if the check and/or any
certificate for Shares not tendered or not purchased are to be mailed to someone
other than the person(s) signing this Letter of Transmittal or to an address
other than that shown in the box above under the heading "Name(s) and
Address(es) of Registered Holder(s)", then the "Special Payment Instructions"
and/or "Special Delivery Instructions" on this Letter of Transmittal should be
completed. Preferred Shareholders tendering Shares by book-entry transfer will
have any Shares not accepted for payment returned by crediting the account
maintained by such Preferred Shareholder at the Book-Entry Transfer Facility
from which such transfer was made.
8. SUBSTITUTE FORM W-9 AND FORM W-8. The tendering Preferred Shareholder
is required to provide the Depositary with either a correct Taxpayer
Identification Number ("TIN") on Substitute Form W-9, which is provided under
"Important Tax Information" below, or a properly completed Form W-8. Failure to
provide the information on either Substitute Form W-9 or Form W-8 may subject
the tendering Preferred Shareholder to a $50 penalty imposed by the Internal
Revenue Service and to 31% federal income tax backup withholding on the payment
of the purchase price for the Shares. The box in Part 2 of Substitute Form W-9
may be checked if the tendering Preferred Shareholder has not been issued a TIN
and has applied for a number or intends to apply for a number in the near
future. If the box in Part 2 is checked and the Depositary is not provided with
a TIN by the time of payment, the Depositary will withhold 31% on all payments
of the purchase price for the Shares thereafter until a TIN is provided to the
Depositary.
9. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Any questions or
requests for assistance may be directed to the Information Agent or the Dealer
Managers at their respective telephone numbers and addresses listed below.
Requests for additional copies of the Offer to Purchase and Proxy Statement,
this Letter of Transmittal or other tender offer materials may be directed to
the Information Agent and such copies will be furnished promptly at AEP's
expense. Preferred Shareholders may also contact their local broker, dealer,
commercial bank or trust company for assistance concerning the Offer.
<PAGE> 68
10. SOLICITED TENDERS. AEP will pay a solicitation fee of $.50 per Share
for any Shares tendered, accepted for payment and paid pursuant to the Offer,
covered by the Letter of Transmittal which designates, under the heading
"Solicited Tenders", as having solicited and obtained the tender, the name of
(a) any broker or dealer in securities, including a Dealer Manager in its
capacity as a dealer or broker, which is a member of any national securities
exchange or of the National Association of Securities Dealers, Inc. (the
"NASD"), (b) any foreign broker or dealer not eligible for membership in the
NASD which agrees to conform to the NASD's Rules of Fair Practice in soliciting
tenders outside the United States to the same extent as though it were an NASD
member, or (c) any bank or trust company (each of which is referred to herein as
a "Soliciting Dealer"). No such fee shall be payable to a Soliciting Dealer with
respect to the tender of Shares by a holder unless the Letter of Transmittal
accompanying such tender designates such Soliciting Dealer. No such fee shall be
payable to a Soliciting Dealer in respect of Shares registered in the name of
such Soliciting Dealer unless such Shares are held by such Soliciting Dealer as
nominee and such Shares are being tendered for the benefit of one or more
beneficial owners identified on the Letter of Transmittal or on the Notice of
Solicited Tenders (included in the materials provided to brokers and dealers).
No such fee shall be payable to a Soliciting Dealer with respect to the tender
of Shares by the holder of record, for the benefit of the beneficial owner,
unless the beneficial owner has designated such Soliciting Dealer. If tendered
Shares are being delivered by book-entry transfer, the Soliciting Dealer must
return a Notice of Solicited Tenders to the Depositary within three business
days after expiration of the Offer to receive a solicitation fee. No such fee
shall be payable to a Soliciting Dealer if such Soliciting Dealer is required
for any reason to transfer the amount of such fee to a depositing holder (other
than itself). No such fee shall be paid to a Soliciting Dealer with respect to
Shares tendered for such Soliciting Dealer's own account. No broker, dealer,
bank, trust company or fiduciary shall be deemed to be the agent of AEP, the
Depositary, the Information Agent or the Dealer Managers for purposes of the
Offer.
Soliciting Dealers will include any organizations described in clauses (a),
(b) or (c) above even when the activities of such organization in connection
with the Offer consist solely of forwarding to clients materials relating to the
Offer, including this Letter of Transmittal, and rendering Shares as directed by
beneficial owners thereof. No Soliciting Dealer is required to make any
recommendation to holders of Shares as to whether to tender or refrain from
tendering in the Offer. No assumption is made, in making payment to any
Soliciting Dealer, that its activities in connection with the Offer included any
activities other than those described above, and for all purposes noted in all
materials relating to the Offer, the term "solicit" shall be deemed to mean no
more than "processing shares tendered" or "forwarding to customers materials
regarding the Offer."
11. IRREGULARITIES. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance of any tender
of Shares will be determined by AEP, in its sole discretion, and its
determination shall be final and binding. AEP reserves the absolute right to
reject any and all tenders of Shares that it determines are not in proper form
or the acceptance for payment of or payment for Shares that may, in the opinion
of AEP's counsel, be unlawful. AEP also reserves the absolute right to waive any
of the conditions to the Offer or any defect or irregularity in any tender of
Shares and AEP's interpretation of the terms and conditions of the Offer
(including these instructions) shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as AEP shall determine. None of AEP, OPCo, the Dealer Managers, the
Depositary, the Information Agent or any other person shall be under any duty to
give notice of any defect or irregularity in tenders, nor shall any of them
incur any liability for failure to give any such notice. Tenders will not be
deemed to have been made until all defects and irregularities have been cured or
waived.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any of your certificate(s)
for Shares have been lost, stolen or destroyed, please call the Depositary at
1-800-649-2153. In addition, you should advise the Depositary of any
certificate(s) you have in your possession. You will need to complete an
Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by the Depositary) and pay an indemnity bond premium fee. The tender of
Shares pursuant to this Letter of Transmittal will not be valid unless prior to
the Expiration Date: (a) such procedures have been completed and a replacement
certificate for the Shares has been delivered to the Depositary or (b) a Notice
of Guaranteed Delivery has been delivered to the Depositary. See Instruction 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL, DULY EXECUTED, TOGETHER WITH, IF
APPLICABLE, CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER, AND ALL OTHER
REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR, IF APPLICABLE, THE
NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY, ON OR PRIOR TO
THE APPLICABLE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under federal income tax law, a Preferred Shareholder whose tendered Shares
are accepted for payment is required to provide the Depositary (as payer) with
either such Preferred Shareholder's correct TIN on Substitute Form W-9 below or
a properly completed Form W-8. If such Preferred Shareholder is an individual,
the TIN is his or her social security number. For businesses and other entities,
the number is the federal employer identification number. If the Depositary is
not provided with the correct TIN or properly completed Form W-8, the Preferred
Shareholder may be subject to a $50 penalty imposed by the Internal Revenue
Code. In addition, payments that are made to such Preferred Shareholder with
respect to Shares purchased pursuant to the Offer may be subject to 31% backup
withholding.
<PAGE> 69
Certain Preferred Shareholders (including, among others, all corporations
and certain foreign individuals) are exempt from backup withholding. For a
corporate United States Preferred Shareholder to qualify for such exemption,
such Preferred Shareholder must provide the Depositary with a properly completed
and executed Substitute Form W-9 attesting to its exempt status. In order for a
foreign Preferred Shareholder to qualify as an exempt recipient, such Preferred
Shareholder must submit to the Depositary a properly completed Internal Revenue
Service Form W-8 (a "Form W-8"), signed under penalties of perjury, attesting to
that Preferred Shareholder's exempt status. A Form W-8 can be obtained from the
Depositary. See the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional instructions.
If federal income tax backup withholding applies, the Depositary is
required to withhold 31% of any payments made to the Preferred Shareholder.
Backup withholding is not an additional tax. Rather, the Federal income tax
liability of persons subject to backup withholding will be reduced by the amount
of the tax withheld. If withholding results in an overpayment of taxes, a refund
may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on payments that are made to a Preferred
Shareholder with respect to Shares purchased pursuant to the Offer, the
Preferred Shareholder is required to notify the Depositary of his or her correct
TIN by completing the Substitute Form W-9 attached hereto certifying that the
TIN provided on Substitute Form W-9 is correct and that (a) the Preferred
Shareholder has not been notified by the Internal Revenue Service that he or she
is subject to federal income tax backup withholding as a result of failure to
report all interest or dividends or (b) the Internal Revenue Service has
notified the Preferred Shareholder that he or she is no longer subject to
federal income tax backup withholding. Foreign Preferred Shareholders must
submit a properly completed Form W-8 in order to avoid the applicable backup
withholding.
WHAT NUMBER TO GIVE THE DEPOSITARY
The Preferred Shareholder is required to give the Depositary the social
security number or employer identification number of the registered owner of the
Shares. If the Shares are in more than one name or are not in the name of the
actual owner, consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional guidance on which
number to report.
PAYER'S NAME: FIRST CHICAGO TRUST COMPANY OF NEW YORK
<TABLE>
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
<C> <S> <C>
Part 1 -- PLEASE PROVIDE YOUR TIN IN THE Social Security Number OR
BOX AT RIGHT AND CERTIFY BY SIGNING AND Employer Identification Number
DATING BELOW. TIN ______________________________
----------------------------------------------------------------------------------------
SUBSTITUTE Name (Please Print) ____________________
Address ________________________________ Part 2 --
City ________ State _____ Zip Code _____ Awaiting TIN [ ]
----------------------------------------------------------------------------------------
FORM W-9 Part 3 -- CERTIFICATION -- UNDER PENALTIES OF PERJURY. I CERTIFY THAT: (1) the number
DEPARTMENT OF THE TREASURY shown on the form is my correct taxpayer identification number (or a TIN has not been
INTERNAL REVENUE SERVICE issued to me but I have mailed or delivered an application to receive a TIN or intend
to do so in the near future), (2) I am not subject to backup withholding either because
I have not been notified by the Internal Revenue Service (the "IRS") that I am subject
to backup withholding as a result of a failure to report all interest or dividends or
the IRS has notified me that I am no longer subject to backup withholding and (3) all
other information provided on this form is true, correct and complete.
SIGNATURE ______________________________________________ DATE_____________________ 1997
You must cross out item (2) above if you have been notified by the IRS that you are
currently subject to backup withholding because of underreporting interest or dividends
on your tax return.
----------------------------------------------------------------------------------------
PAYER'S REQUEST FOR TAXPAYER NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31%
IDENTIFICATION NUMBER ("TIN") OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE ENCLOSED
AND CERTIFICATION GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9
FOR ADDITIONAL DETAILS. YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE
BOX IN PART 2 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has not been
issued to me and either (1) I have mailed or delivered an application to receive a
taxpayer identification number to the appropriate Internal Revenue Service Center or
Social Security Administration Office or (2) I intend to do so in the near future. I
understand that if I do not provide a taxpayer identification number by the time of
payment, 31% of all payments of the purchase price made to me will be withheld until I
provide a number.
SIGNATURE ___________________________________________ Date: _____________________ 1997.
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 70
THE DEALER MANAGERS:
<TABLE>
<S> <C>
MERRILL LYNCH & CO. SALOMON BROTHERS INC
World Financial Center Seven World Trade Center
250 Vesey Street New York, New York 10048
New York, New York 10281 Attn: Liability Management Department
(888) ML4-TNDR (toll free) (800) 558-3745 (toll free)
((888) 654-8637 (toll free))
</TABLE>
THE INFORMATION AGENT:
MORROW & CO., INC.
909 Third Avenue
New York, New York 10022-4799
(800) 566-9061 (call toll free)
(212) 754-8000
<PAGE> 1
NOTICE OF GUARANTEED DELIVERY
FOR
AMERICAN ELECTRIC POWER COMPANY, INC.
OFFER TO PURCHASE FOR CASH
ANY AND ALL OUTSTANDING SHARES
OF THE FOLLOWING SERIES OF CUMULATIVE PREFERRED STOCK
OF
OHIO POWER COMPANY
Cumulative Preferred Stock (no par value):
4-1/2% Series
4.08% Series
4.20% Series
4.40% Series
5.90% Series
6.02% Series
6.35% Series
This form, or a form substantially equivalent to this form, must be used to
accept the Offer (as defined below) if certificates for shares of a series of
cumulative preferred stock (each a "Series of Preferred") of Ohio Power Company
("OPCo"), an Ohio corporation and direct utility subsidiary of American Electric
Power Company, Inc., a New York corporation ("AEP"), to be tendered pursuant to
the Offer (the "Shares") are not immediately available, if the procedure for
book-entry transfer cannot be completed on a timely basis, or if time will not
permit all other documents required by the Letter of Transmittal (as defined in
the Offer to Purchase and Proxy Statement, which is defined below) to be
delivered to the Depositary (as defined below) on or prior to the Expiration
Date (as defined in the Offer to Purchase and Proxy Statement). Such form may be
delivered by hand or transmitted by mail to the Depositary. See "Terms of the
Offer -- Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement.
A SEPARATE NOTICE OF GUARANTEED DELIVERY MUST BE USED FOR EACH SERIES OF
PREFERRED.
THE ELIGIBLE INSTITUTION (AS DEFINED IN THE LETTER OF TRANSMITTAL) WHICH
COMPLETES THIS FORM MUST DELIVER THE LETTER OF TRANSMITTAL AND CERTIFICATES FOR
SHARES TO THE DEPOSITARY WITHIN THE TIME SHOWN HEREIN. FAILURE TO DO SO COULD
RESULT IN A FINANCIAL LOSS TO SUCH ELIGIBLE INSTITUTION.
TO: FIRST CHICAGO TRUST COMPANY OF NEW YORK, DEPOSITARY
<TABLE>
<S> <C> <C>
By Mail: By Hand: By Overnight Courier:
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
P.O. Box 2569 c/o The Depository Trust Company 14 Wall Street, 8th Floor
Suite 4660 55 Water Street, DTC TAD Suite 4680 -- OPCo
Jersey City, NJ 07303-2569 Vietnam Veterans Memorial Plaza New York, NY 10005
New York, NY 10041
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE
WILL NOT CONSTITUTE A VALID DELIVERY.
<PAGE> 2
This form is not to be used to guarantee signatures. If a signature on a
Letter of Transmittal is required to be guaranteed by an Eligible Institution
under the instructions thereto, such signature guarantee must appear in the
applicable space provided in the signature box on the Letter of Transmittal.
The undersigned hereby tenders to AEP, upon the terms and subject to the
conditions set forth in the Offer to Purchase and Proxy Statement, dated January
30, 1997 (the "Offer to Purchase and Proxy Statement"), and the related Letter
of Transmittal (which together constitute the "Offer"), receipt of which is
hereby acknowledged, the number of Shares listed below, pursuant to the
guaranteed delivery procedure set forth in "Terms of the Offer -- Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement. WHILE PREFERRED
SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT TO THE OFFER NEED NOT VOTE
IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S AMENDED ARTICLES OF INCORPORATION,
AS SET FORTH IN THE OFFER TO PURCHASE AND PROXY STATEMENT (THE "PROPOSED
AMENDMENT"), THE OFFER IS CONDITIONED UPON THE PROPOSED AMENDMENT BEING APPROVED
AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED IN THE OFFER TO PURCHASE AND
PROXY STATEMENT). IN ADDITION, PREFERRED SHAREHOLDERS OF RECORD HAVE THE RIGHT
TO VOTE FOR OR AGAINST THE PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER
THEIR SHARES BY CASTING THEIR VOTE AND SIGNING THE PROXY ENCLOSED HEREWITH OR BY
VOTING IN PERSON AT THE SPECIAL MEETING. IF THE PROPOSED AMENDMENT IS APPROVED
AND ADOPTED BY OPCO'S SHAREHOLDERS, OPCO WILL MAKE A SPECIAL CASH PAYMENT (AS
DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT) TO EACH PREFERRED
SHAREHOLDER WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT SUCH
PREFERRED SHAREHOLDER'S SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
<TABLE>
<S> <C>
Number of Shares:_________________________
------------------------------------------
------------------------------------------
Signature(s) of Holder(s)
Certificate Nos.
(if available): Dated: ___________________________, 199___
- ------------------------------------------
Name(s) of Holder(s): ____________________
- ------------------------------------------
------------------------------------------
Check one box if Shares will be delivered
by book-entry transfer: ------------------------------------------
Please Type or Print
[ ] The Depository Trust Company Address:
---------------------------------
[ ] Philadelphia Depository Trust
Company ------------------------------------------
Zip Code
Area Code and
Account No.: Telephone No.:
----------------------------- ---------------------------
</TABLE>
<PAGE> 3
GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm that is a member of a registered national
securities exchange or the National Association of Securities Dealers, Inc. or a
commercial bank or trust company having an office or correspondent in the United
States, guarantees (a) that the above-named person(s) has a net long position in
the Shares being tendered within the meaning of Rule 14e-4 promulgated under the
Securities Exchange Act of 1934, as amended, (b) that such tender of Shares
complies with such Rule 14e-4 and (c) to deliver to the Depositary at one of its
addresses set forth above certificate(s) for the Shares tendered hereby, in
proper form for transfer, or a confirmation of the book-entry transfer of the
Shares tendered hereby into the Depositary's account at The Depository Trust
Company or the Philadelphia Depository Trust Company with a properly completed
and duly executed Letter(s) of Transmittal, with any required signature
guarantee(s) and any other required documents, all within three New York Stock
Exchange trading days after the date hereof.
<TABLE>
<S> <C>
- ---------------------------------------------------- ----------------------------------------
Name of Firm Authorized Signature
- ---------------------------------------------------- ----------------------------------------
Address Name
- ---------------------------------------------------- ----------------------------------------
City, State, Zip Code Title
- ----------------------------------------------------
Area Code and Telephone Number
Dated: ________________________ , 1997
</TABLE>
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST
BE SENT WITH THE LETTER OF TRANSMITTAL.
<PAGE> 4
GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm that is a member of a registered national
securities exchange or the National Association of Securities Dealers, Inc. or a
commercial bank or trust company having an office or correspondent in the United
States, guarantees (a) that the above-named person(s) has a net long position in
the Shares being tendered within the meaning of Rule 14e-4 promulgated under the
Securities Exchange Act of 1934, as amended, (b) that such tender of Shares
complies with such Rule 14e-4 and (c) to deliver to the Depositary at one of its
addresses set forth above certificate(s) for the Shares tendered hereby, in
proper form for transfer, or a confirmation of the book-entry transfer of the
Shares tendered hereby into the Depositary's account at The Depository Trust
Company or the Philadelphia Depository Trust Company with a properly completed
and duly executed Letter(s) of Transmittal, with any required signature
guarantee(s) and any other required documents, all within three New York Stock
Exchange trading days after the date hereof.
<TABLE>
<S> <C>
- ----------------------------------------------- -------------------------------------
Name of Firm Authorized Signature
- ----------------------------------------------- -------------------------------------
Address Name
- ----------------------------------------------- -------------------------------------
City, State, Zip Code Title
- -----------------------------------------------
Area Code and Telephone Number
Dated: ________________________ , 1997
</TABLE>
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST
BE SENT WITH THE LETTER OF TRANSMITTAL.
<PAGE> 1
MERRILL LYNCH & CO. SALOMON BROTHERS INC
THE DEALER MANAGERS FOR
AMERICAN ELECTRIC POWER COMPANY, INC.
OFFER TO PURCHASE FOR CASH
ANY AND ALL OUTSTANDING SHARES OF THE FOLLOWING SERIES OF
CUMULATIVE PREFERRED STOCK OF
OHIO POWER COMPANY
<TABLE>
<C> <S>
202,403 SHARES, CUMULATIVE PREFERRED STOCK, 4-1/2% SERIES AT A PURCHASE PRICE OF $ 69.02 PER SHARE, CUSIP NUMBER 677415 40 8
42,575 SHARES, CUMULATIVE PREFERRED STOCK, 4.08% SERIES AT A PURCHASE PRICE OF $ 64.56 PER SHARE, CUSIP NUMBER 677415 10 1
51,975 SHARES, CUMULATIVE PREFERRED STOCK, 4.20% SERIES AT A PURCHASE PRICE OF $ 66.46 PER SHARE, CUSIP NUMBER 677415 20 0
88,363 SHARES, CUMULATIVE PREFERRED STOCK, 4.40% SERIES AT A PURCHASE PRICE OF $ 69.62 PER SHARE, CUSIP NUMBER 677415 30 9
404,000 SHARES, CUMULATIVE PREFERRED STOCK, 5.90% SERIES AT A PURCHASE PRICE OF $103.09 PER SHARE, CUSIP NUMBER 677415 79 6
395,000 SHARES, CUMULATIVE PREFERRED STOCK, 6.02% SERIES AT A PURCHASE PRICE OF $103.71 PER SHARE, CUSIP NUMBER 677415 81 2
300,000 SHARES, CUMULATIVE PREFERRED STOCK, 6.35% SERIES AT A PURCHASE PRICE OF $105.14 PER SHARE, CUSIP NUMBER 677415 82 0
</TABLE>
------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON FRIDAY, FEBRUARY 28, 1997, UNLESS THE OFFER IS EXTENDED.
------------------------
January 30, 1997
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
We have been appointed by American Electric Power Company, Inc., a New York
corporation ("AEP"), to act as Dealer Managers and in connection therewith are
enclosing the material listed below relating to the invitation of AEP to the
holders of each series of cumulative preferred stock of Ohio Power Company, an
Ohio corporation and direct utility subsidiary of AEP ("OPCo"), listed above
(each a "Series of Preferred") to tender any and all of their shares of a Series
of Preferred ("Shares") for purchase at the purchase price per Share listed
above plus accrued and unpaid dividends, net to the seller in cash, upon the
terms and subject to the conditions set forth in the Offer to Purchase and Proxy
Statement, dated January 30, 1997 (the "Offer to Purchase and Proxy Statement"),
the proxy and in the Letter of Transmittal for the Shares tendered. As to each
Series of Preferred, the Offer to Purchase and Proxy Statement, together with
the applicable Letter of Transmittal, constitutes the "Offer." AEP will purchase
all Shares validly tendered and not withdrawn, upon the terms and subject to the
conditions of the Offer. The Offer for a Series of Preferred is not conditioned
upon any minimum number of Shares of such Series of Preferred being tendered and
is independent of the Offer for any other Series of Preferred. WHILE PREFERRED
SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT TO THE OFFER NEED NOT VOTE
IN FAVOR OF THE PROPOSED AMENDMENT TO OPCO'S AMENDED ARTICLES OF INCORPORATION,
AS SET FORTH IN THE OFFER TO PURCHASE AND PROXY STATEMENT (THE "PROPOSED
AMENDMENT"), THE OFFER IS CONDITIONED UPON THE PROPOSED AMENDMENT BEING APPROVED
AND ADOPTED AT THE SPECIAL MEETING (AS DEFINED IN THE OFFER TO PURCHASE AND
PROXY STATEMENT). IN ADDITION, PREFERRED SHAREHOLDERS OF RECORD HAVE THE RIGHT
TO VOTE FOR OR AGAINST THE PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER
THEIR SHARES BY CASTING THEIR VOTE AND SIGNING THE PROXY ENCLOSED HEREWITH OR BY
VOTING IN PERSON AT THE SPECIAL MEETING. IF THE PROPOSED AMENDMENT IS APPROVED
AND ADOPTED BY OPCO'S SHAREHOLDERS, OPCO WILL MAKE A SPECIAL CASH PAYMENT IN THE
AMOUNT OF $1.00 PER SHARE TO EACH PREFERRED SHAREHOLDER WHO VOTED IN FAVOR OF
THE PROPOSED AMENDMENT, PROVIDED THAT SUCH SHARES HAVE NOT BEEN TENDERED
PURSUANT TO THE OFFER. SEE "PROPOSED AMENDMENT AND PROXY SOLICITATION", "TERMS
OF THE OFFER -- CERTAIN CONDITION OF THE OFFER" AND "TERMS OF THE OFFER --
EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENT" IN THE OFFER TO PURCHASE AND
PROXY STATEMENT.
We are asking you to contact your clients for whom you hold Shares
registered in your name (or in the name of your nominee) or who hold Shares
registered in their own names. Please bring the Offer to their attention as
promptly as possible.
AEP will pay to each designated Soliciting Dealer a solicitation fee of
$1.50 per Share for Shares of the 4 1/2% Series, the 4.08% Series, the 4.20%
Series, and the 4.40% Series that are tendered, accepted for payment and paid
for pursuant to the Offer (except that for transactions for beneficial owners
equal to or exceeding 5,000 Shares, AEP will pay a solicitation fee of $1.00 per
Share for Shares of the 4 1/2% Series, the 4.08% Series, the 4.20% Series and
the 4.40% Series. AEP will pay a solicitation fee of $.50 per Share for Shares
of the 5.90% Series, the 6.02% Series and the 6.35% Series that are tendered,
accepted for payment and paid pursuant to the Offer; provided, however, that any
Fee payable pursuant to this sentence shall be paid 80% to the Dealer Managers
and 20% to any designated Soliciting Dealer (which may be a Dealer Manager).
OPCo will pay a separate fee of $.50 per Share for Shares of the 4 1/2% Series,
the 4.08% Series, the 4.20% Series and the 4.40% Series that are not tendered
pursuant to the Offer but which are voted in favor of the Proposed Amendment. A
designated Soliciting Dealer is an entity obtaining the tender or proxy, if the
Letter of Transmittal or proxy, as the case may be, shall include its name and
it is (i) any broker or dealer in securities, including the Dealer Managers in
their capacity as a broker or dealer, which is a member of any national
securities exchange or of the National Association of Securities Dealers, Inc.
(the "NASD"), (ii) any foreign broker or dealer not eligible for membership in
the NASD which agrees to conform to the NASD's Rules of Fair Practice in
soliciting tenders outside the United States to the same extent as though it
were an NASD member, or (iii) any bank or trust company. No solicitation fee or
separate fee (other than solicitation fees payable to the Dealer Managers as
provided above) shall be payable to a Soliciting Dealer with respect to the
tender of Shares or the vote of Shares by a holder unless the Letter of
Transmittal or proxy accompanying such tender or vote, as the case may be,
designates such Soliciting Dealer. No solicitation fee or separate fee shall be
payable to a Soliciting Dealer in respect of Shares registered in the name of
such Soliciting Dealer unless such Shares are held by such Soliciting Dealer as
nominee and such Shares are being tendered or voted for the benefit of one or
more beneficial owners identified on the Letter of Transmittal or on the Notice
of Solicited Tenders (included below). No solicitation fee or separate fee shall
be payable to a Soliciting Dealer if such Soliciting Dealer is required for any
reason to transfer the amount of such fee to a depositing holder (other than
itself). No solicitation fee shall be paid to a Soliciting Dealer with respect
to Shares tendered for such Soliciting Dealer's own account and no separate fee
shall be paid to a Soliciting Dealer with respect to Shares voted for such
Soliciting Dealer's own account. A Soliciting Dealer shall not be entitled to a
solicitation fee or a separate fee for Shares beneficially owned by
<PAGE> 2
such Soliciting Dealer. No broker, dealer, bank, trust company or fiduciary
shall be deemed to be the agent of AEP, OPCo the Depositary (as defined below),
the Dealer Managers or the Information Agent (as defined below) for purposes of
the Offer.
Soliciting Dealers will include any of the organizations described in
clauses (i), (ii) and (iii) above even when the activities of such organizations
in connection with the Offer consist solely of forwarding to clients materials
relating to the Offer, including the Letter of Transmittal and tendering Shares
as directed by beneficial owners thereof. No Soliciting Dealer is required to
make any recommendation to holders of Shares as to whether to tender or refrain
from tendering in the Offer. No assumption is made, in making payment to any
Soliciting Dealer, that its activities in connection with the Offer included any
activities other than those described above, and for all purposes noted in all
materials relating to the Offer, the term "solicit" shall be deemed to mean no
more than "processing shares tendered" or "forwarding to customers materials
regarding the Offer."
AEP will also, upon request, reimburse Soliciting Dealers for reasonable and
customary handling and mailing expenses incurred by them in forwarding materials
relating to the Offer to their customers. AEP will pay all stock transfer taxes
applicable to its purchase of Shares pursuant to the Offer, subject to
Instruction 6 of the Letter of Transmittal.
In order for a Soliciting Dealer to receive a solicitation fee or a separate
fee, First Chicago Trust Company of New York, as Depositary (the "Depositary"),
must have received from such Soliciting Dealer a properly completed and duly
executed Notice of Solicited Tenders and Proxies in the form attached hereto
within three business days after the expiration of the Offer or a properly
executed proxy on or before the Expiration Date.
For your information and for forwarding to your clients for whom you hold
Shares registered in your name (or in the name of your nominee), we are
enclosing the following documents:
1. The Offer to Purchase and Proxy Statement, dated January 30, 1997.
2. A separate Letter of Transmittal for each Series of Preferred for
your use and for the information of your clients.
3. A Proxy.
4. A letter to shareholders of OPCo from its Chairman of the Board and
Chief Executive Officer.
5. A Notice of Guaranteed Delivery to be used to accept the Offer if the
Shares and all other required documents cannot be delivered to the
Depositary by the applicable Expiration Date (as defined in the Offer to
Purchase and Proxy Statement).
6. A form of letter which may be sent to your clients for whose accounts
you hold Shares registered in your name or in the name of your nominee, with
space for obtaining such clients' instructions with regard to the Offer and
with regard to the proxy solicitation by OPCo.
7. Guidelines of the Internal Revenue Service for Certification of
Taxpayer Identification Number on Substitute Form W-9, providing information
relating to backup federal income tax withholding.
8. A return envelope addressed to First Chicago Trust Company of New
York, the Depositary.
9. Cover Letter containing Summary Simplified Instructions.
Each Series of Preferred has its own Letter of Transmittal, and only the
applicable Letter of Transmittal for a particular Series or a Notice of
Guaranteed Delivery may be used to tender Shares of such Series of Preferred.
We urge you to contact your clients as promptly as possible. Please note
that the Offer and withdrawal rights will expire at 5:00 p.m., New York City
time, on Friday, February 28, 1997, unless the Offer is extended.
NEITHER AEP, OPCO, THEIR RESPECTIVE BOARDS OF DIRECTORS NOR ANY OF THEIR
RESPECTIVE OFFICERS MAKES ANY RECOMMENDATION TO ANY PREFERRED SHAREHOLDER AS TO
WHETHER TO TENDER ANY OR ALL SHARES. EACH PREFERRED SHAREHOLDER MUST MAKE HIS OR
HER OWN DECISION AS TO WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO
TENDER.
Any questions or requests for assistance or additional copies of the
enclosed materials may be directed to Morrow & Co., Inc., the Information Agent,
or to us, as Dealer Managers, at the respective addresses and telephone numbers
set forth on the back cover of the enclosed Offer to Purchase and Proxy
Statement.
Very truly yours,
MERRILL LYNCH & CO. SALOMON BROTHERS INC
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY PERSON AS THE AGENT OF AEP, OPCO, THE DEALER MANAGERS, THE INFORMATION
AGENT OR THE DEPOSITARY, OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY
DOCUMENT OR MAKE ANY STATEMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE
OFFER OTHER THAN THE DOCUMENTS ENCLOSED HEREWITH AND THE STATEMENTS CONTAINED
THEREIN.
<PAGE> 3
NOTICE OF SOLICITED TENDERS AND PROXIES FOR THE OPCO 4-1/2% SERIES
List below the number of Shares tendered or voted in favor of the Proposed
Amendment but not tendered by each beneficial owner whose tender or vote you
have solicited. All Shares in a Series of Preferred beneficially owned by a
beneficial owner, whether in one account or several, and in however many
capacities, must be aggregated for purposes of completing the table below. Any
questions as to what constitutes beneficial ownership should be directed to the
Depositary. If the space below is inadequate, list the Shares in a separate
signed schedule and affix the list to this Notice of Solicited Tenders and
Proxies. PLEASE DO NOT COMPLETE THE SECTIONS OF THE TABLE HEADED "TO BE
COMPLETED ONLY BY DEPOSITARY."
ALL NOTICES OF SOLICITED TENDERS SHOULD BE RETURNED TO, AND ALL QUESTIONS
CONCERNING THE NOTICES OF SOLICITED TENDERS SHOULD BE DIRECTED TO, THE
DEPOSITARY. ALL NOTICES OF SOLICITED TENDERS MUST BE RECEIVED BY THE DEPOSITARY
WITHIN THREE BUSINESS DAYS AFTER THE EXPIRATION DATE.
BENEFICIAL HOLDERS OF LESS THAN 5,000 SHARES (TENDERS ONLY)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
TO BE COMPLETED BY TO BE COMPLETED ONLY
SOLICITING DEALER BY DEPOSITARY
---------------------------------------------------------------
NUMBER OF VOI TICKET NUMBER OF $1.50 FEE
BENEFICIAL OWNERS SHARES TENDERED NUMBER* SHARES ACCEPTED PER SHARE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Beneficial Owner No. 1............
- ---------------------------------------------------------------------------------------------------
Beneficial Owner No. 2............
- ---------------------------------------------------------------------------------------------------
Beneficial Owner No. 3............
- ---------------------------------------------------------------------------------------------------
Beneficial Owner No. 4............
- ---------------------------------------------------------------------------------------------------
Beneficial Owner No. 5............
- ---------------------------------------------------------------------------------------------------
Total.....................
- ---------------------------------------------------------------------------------------------------
</TABLE>
BENEFICIAL HOLDERS OF 5,000 OR MORE SHARES (TENDERS ONLY)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
TO BE COMPLETED BY TO BE COMPLETED ONLY
SOLICITING DEALER BY DEPOSITARY
---------------------------------------------------------------
NUMBER OF VOI TICKET NUMBER OF $1.00 FEE
BENEFICIAL OWNERS SHARES TENDERED NUMBER* SHARES ACCEPTED PER SHARE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Beneficial Owner No. 1............
- ---------------------------------------------------------------------------------------------------
Beneficial Owner No. 2............
- ---------------------------------------------------------------------------------------------------
Beneficial Owner No. 3............
- ---------------------------------------------------------------------------------------------------
Beneficial Owner No. 4............
- ---------------------------------------------------------------------------------------------------
Beneficial Owner No. 5............
- ---------------------------------------------------------------------------------------------------
Total.....................
- ---------------------------------------------------------------------------------------------------
</TABLE>
- ---------------
* Complete if Shares delivered by book-entry transfer. Please submit a separate
VOI ticket for Shares tendered when the solicitation fee is to be directed to
another Soliciting Dealer. At the time of tendering Shares in book-entry form,
please indicate your request in the comments field.
<PAGE> 4
PROXY ONLY
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
TO BE COMPLETED BY
SOLICITING DEALER TO BE COMPLETED BY
DEPOSITARY
----------------------------------------------
BENEFICIAL OWNERS NUMBER OF NUMBER OF $.50 FEE
SHARES VOTED SHARES VOTED PER SHARE
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Beneficial Owner No. 1..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 2..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 3..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 4..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 5..........................
- ------------------------------------------------------------------------------------------------
Total.................................
- ------------------------------------------------------------------------------------------------
</TABLE>
All questions as to the validity, form and eligibility (including time of
receipt) of any Notice of Solicited Tenders will be determined by the
Depositary, in its sole discretion, which determination will be final and
binding. Neither the Depositary nor any other person will be under any duty to
give notification of any defects or irregularities in any Notice of Solicited
Tenders or incur any liability for failure to give such notification.
PLEASE COMPLETE THE SIGNATURE FORM ON THE LAST PAGE.
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST
BE SENT WITH THE LETTER OF TRANSMITTAL.
<PAGE> 5
NOTICE OF SOLICITED TENDERS AND PROXIES FOR THE OPCO 4.08% SERIES
List below the number of Shares tendered or voted in favor of the Proposed
Amendment but not tendered by each beneficial owner whose tender or vote you
have solicited. All Shares in a Series of Preferred beneficially owned by a
beneficial owner, whether in one account or several, and in however many
capacities, must be aggregated for purposes of completing the table below. Any
questions as to what constitutes beneficial ownership should be directed to the
Depositary. If the space below is inadequate, list the Shares in a separate
signed schedule and affix the list to this Notice of Solicited Tenders and
Proxies. PLEASE DO NOT COMPLETE THE SECTIONS OF THE TABLE HEADED "TO BE
COMPLETED ONLY BY DEPOSITARY."
ALL NOTICES OF SOLICITED TENDERS SHOULD BE RETURNED TO, AND ALL QUESTIONS
CONCERNING THE NOTICES OF SOLICITED TENDERS SHOULD BE DIRECTED TO, THE
DEPOSITARY. ALL NOTICES OF SOLICITED TENDERS MUST BE RECEIVED BY THE DEPOSITARY
WITHIN THREE BUSINESS DAYS AFTER THE EXPIRATION DATE.
BENEFICIAL HOLDERS OF LESS THAN 5,000 SHARES (TENDERS ONLY)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
TO BE COMPLETED BY TO BE COMPLETED ONLY
SOLICITING DEALER BY DEPOSITARY
---------------------------------------------------------------
NUMBER OF VOI TICKET NUMBER OF $1.50 FEE
BENEFICIAL OWNERS SHARES TENDERED NUMBER* SHARES ACCEPTED PER SHARE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Beneficial Owners No. 1...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 2...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 3...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 4...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 5...........
- ---------------------------------------------------------------------------------------------------
Total.....................
- ---------------------------------------------------------------------------------------------------
</TABLE>
BENEFICIAL HOLDERS OF 5,000 OR MORE SHARES (TENDERS ONLY)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
TO BE COMPLETED BY TO BE COMPLETED ONLY
SOLICITING DEALER BY DEPOSITARY
---------------------------------------------------------------
NUMBER OF VOI TICKET NUMBER OF $1.00 FEE
BENEFICIAL OWNERS SHARES TENDERED NUMBER* SHARES ACCEPTED PER SHARE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Beneficial Owners No. 1...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 2...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 3...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 4...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 5...........
- ---------------------------------------------------------------------------------------------------
Total.....................
- ---------------------------------------------------------------------------------------------------
</TABLE>
- ---------------
* Complete if Shares delivered by book-entry transfer. Please submit a separate
VOI ticket for Shares tendered when the solicitation fee is to be directed to
another Soliciting Dealer. At the time of tendering Shares in book-entry form,
please indicate your request in the comments field.
<PAGE> 6
PROXY ONLY
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
TO BE COMPLETED BY
SOLICITING DEALER TO BE COMPLETED BY
DEPOSITARY
----------------------------------------------
BENEFICIAL OWNERS NUMBER OF NUMBER OF $.50 FEE
SHARES VOTED SHARES VOTED PER SHARE
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Beneficial Owner No. 1..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 2..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 3..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 4..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 5..........................
- ------------------------------------------------------------------------------------------------
Total.................................
- ------------------------------------------------------------------------------------------------
</TABLE>
All questions as to the validity, form and eligibility (including time of
receipt) of any Notice of Solicited Tenders will be determined by the
Depositary, in its sole discretion, which determination will be final and
binding. Neither the Depositary nor any other person will be under any duty to
give notification of any defects or irregularities in any Notice of Solicited
Tenders or incur any liability for failure to give such notification.
PLEASE COMPLETE THE SIGNATURE FORM ON THE LAST PAGE.
PLEASE DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK
CERTIFICATES MUST BE SENT WITH THE LETTER OF TRANSMITTAL.
<PAGE> 7
NOTICE OF SOLICITED TENDERS AND PROXIES FOR THE OPCO 4.20% SERIES
List below the number of Shares tendered or voted in favor of the Proposed
Amendment but not tendered by each beneficial owner whose tender or vote you
have solicited. All Shares in a Series of Preferred beneficially owned by a
beneficial owner, whether in one account or several, and in however many
capacities, must be aggregated for purposes of completing the table below. Any
questions as to what constitutes beneficial ownership should be directed to the
Depositary. If the space below is inadequate, list the Shares in a separate
signed schedule and affix the list to this Notice of Solicited Tenders and
Proxies. PLEASE DO NOT COMPLETE THE SECTIONS OF THE TABLE HEADED "TO BE
COMPLETED ONLY BY DEPOSITARY."
ALL NOTICES OF SOLICITED TENDERS SHOULD BE RETURNED TO, AND ALL QUESTIONS
CONCERNING THE NOTICES OF SOLICITED TENDERS SHOULD BE DIRECTED TO, THE
DEPOSITARY. ALL NOTICES OF SOLICITED TENDERS MUST BE RECEIVED BY THE DEPOSITARY
WITHIN THREE BUSINESS DAYS AFTER THE EXPIRATION DATE.
BENEFICIAL HOLDERS OF LESS THAN 5,000 SHARES (TENDERS ONLY)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
TO BE COMPLETED BY TO BE COMPLETED ONLY
SOLICITING DEALER BY DEPOSITARY
---------------------------------------------------------------
NUMBER OF VOI TICKET NUMBER OF $1.50 FEE
BENEFICIAL OWNERS SHARES TENDERED NUMBER* SHARES ACCEPTED PER SHARE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Beneficial Owners No. 1...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 2...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 3...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 4...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 5...........
- ---------------------------------------------------------------------------------------------------
Total.....................
- ---------------------------------------------------------------------------------------------------
</TABLE>
BENEFICIAL HOLDERS OF 5,000 OR MORE SHARES (TENDERS ONLY)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
TO BE COMPLETED BY TO BE COMPLETED ONLY
SOLICITING DEALER BY DEPOSITARY
---------------------------------------------------------------
NUMBER OF VOI TICKET NUMBER OF $1.00 FEE
BENEFICIAL OWNERS SHARES TENDERED NUMBER* SHARES ACCEPTED PER SHARE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Beneficial Owners No. 1...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 2...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 3...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 4...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 5...........
- ---------------------------------------------------------------------------------------------------
Total.....................
- ---------------------------------------------------------------------------------------------------
</TABLE>
- ---------------
* Complete if Shares delivered by book-entry transfer. Please submit a separate
VOI ticket for Shares tendered when the solicitation fee is to be directed to
another Soliciting Dealer. At the time of tendering Shares in book-entry form,
please indicate your request in the comments field.
<PAGE> 8
PROXY ONLY
<TABLE>
- ------------------------------------------------------------------------------------------------
TO BE COMPLETED BY
SOLICITING DEALER TO BE COMPLETED BY
DEPOSITARY
----------------------------------------------
BENEFICIAL OWNERS NUMBER OF NUMBER OF $.50 FEE
SHARES VOTED SHARES VOTED PER SHARE
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Beneficial Owner No. 1..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 2..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 3..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 4..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 5..........................
- ------------------------------------------------------------------------------------------------
Total.................................
- ------------------------------------------------------------------------------------------------
</TABLE>
All questions as to the validity, form and eligibility (including time of
receipt) of any Notice of Solicited Tenders will be determined by the
Depositary, in its sole discretion, which determination will be final and
binding. Neither the Depositary nor any other person will be under any duty to
give notification of any defects or irregularities in any Notice of Solicited
Tenders or incur any liability for failure to give such notification.
PLEASE DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES
MUST BE SENT WITH YOUR LETTER OF TRANSMITTAL.
PLEASE COMPLETE THE SIGNATURE FORM ON THE LAST PAGE.
<PAGE> 9
NOTICE OF SOLICITED TENDERS AND PROXIES FOR THE OPCO 4.40% SERIES
List below the number of Shares tendered or voted in favor of the Proposed
Amendment but not tendered by each beneficial owner whose tender or vote you
have solicited. All Shares in a Series of Preferred beneficially owned by a
beneficial owner, whether in one account or several, and in however many
capacities, must be aggregated for purposes of completing the table below. Any
questions as to what constitutes beneficial ownership should be directed to the
Depositary. If the space below is inadequate, list the Shares in a separate
signed schedule and affix the list to this Notice of Solicited Tenders and
Proxies. PLEASE DO NOT COMPLETE THE SECTIONS OF THE TABLE HEADED "TO BE
COMPLETED ONLY BY DEPOSITARY."
ALL NOTICES OF SOLICITED TENDERS SHOULD BE RETURNED TO, AND ALL QUESTIONS
CONCERNING THE NOTICES OF SOLICITED TENDERS SHOULD BE DIRECTED TO, THE
DEPOSITARY. ALL NOTICES OF SOLICITED TENDERS MUST BE RECEIVED BY THE DEPOSITARY
WITHIN THREE BUSINESS DAYS AFTER THE EXPIRATION DATE.
BENEFICIAL HOLDERS OF LESS THAN 5,000 SHARES (TENDERS ONLY)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
TO BE COMPLETED BY TO BE COMPLETED ONLY
SOLICITING DEALER BY DEPOSITARY
---------------------------------------------------------------
NUMBER OF VOI TICKET NUMBER OF $1.50 FEE
BENEFICIAL OWNERS SHARES TENDERED NUMBER* SHARES ACCEPTED PER SHARE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Beneficial Owners No. 1...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 2...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 3...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 4...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 5...........
- ---------------------------------------------------------------------------------------------------
Total...................
- ---------------------------------------------------------------------------------------------------
</TABLE>
BENEFICIAL HOLDERS OF 5,000 OR MORE SHARES
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
TO BE COMPLETED BY TO BE COMPLETED ONLY
SOLICITING DEALER BY DEPOSITARY
---------------------------------------------------------------
NUMBER OF VOI TICKET NUMBER OF $1.00 FEE
BENEFICIAL OWNERS SHARES TENDERED NUMBER* SHARES ACCEPTED PER SHARE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Beneficial Owners No. 1...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 2...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 3...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 4...........
- ---------------------------------------------------------------------------------------------------
Beneficial Owners No. 5...........
- ---------------------------------------------------------------------------------------------------
Total.....................
- ---------------------------------------------------------------------------------------------------
</TABLE>
- ---------------
* Complete if Shares delivered by book-entry transfer. Please submit a separate
VOI ticket for Shares tendered when the solicitation fee is to be directed to
another Soliciting Dealer. At the time of tendering Shares in book-entry form,
please indicate your request in the comments field.
<PAGE> 10
PROXY ONLY
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
TO BE COMPLETED BY
SOLICITING DEALER TO BE COMPLETED BY
DEPOSITARY
----------------------------------------------
BENEFICIAL OWNERS NUMBER OF NUMBER OF $.50 FEE
SHARES VOTED SHARES VOTED PER SHARE
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Beneficial Owner No. 1..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 2..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 3..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 4..........................
- ------------------------------------------------------------------------------------------------
Beneficial Owner No. 5..........................
- ------------------------------------------------------------------------------------------------
Total.................................
- ------------------------------------------------------------------------------------------------
</TABLE>
All questions as to the validity, form and eligibility (including time of
receipt) of any Notice of Solicited Tenders will be determined by the
Depositary, in its sole discretion, which determination will be final and
binding. Neither the Depositary nor any other person will be under any duty to
give notification of any defects or irregularities in any Notice of Solicited
Tenders or incur any liability for failure to give such notification.
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST
BE SENT WITH THE LETTER OF TRANSMITTAL.
PLEASE COMPLETE THE SIGNATURE FORM ON THE LAST PAGE.
<PAGE> 11
NOTICE OF SOLICITED TENDERS FOR THE OPCO 5.90% SERIES
List below the number of Shares tendered by each beneficial owner whose
tender you have solicited. All Shares in a Series of Preferred beneficially
owned by a beneficial owner, whether in one account or several, and in however
many capacities, must be aggregated for purposes of completing the table below.
Any questions as to what constitutes beneficial ownership should be directed to
the Depositary. If the space below is inadequate, list the Shares in a separate
signed schedule and affix the list to this Notice of Solicited Tenders. PLEASE
DO NOT COMPLETE THE SECTIONS OF THE TABLE HEADED "TO BE COMPLETED ONLY BY
DEPOSITARY."
ALL NOTICES OF SOLICITED TENDERS SHOULD BE RETURNED TO, AND ALL QUESTIONS
CONCERNING THE NOTICES OF SOLICITED TENDERS SHOULD BE DIRECTED TO, THE
DEPOSITARY. ALL NOTICES OF SOLICITED TENDERS MUST BE RECEIVED BY THE DEPOSITARY
WITHIN THREE BUSINESS DAYS AFTER THE EXPIRATION DATE.
TENDERS ONLY
<TABLE>
<CAPTION>
TO BE COMPLETED BY TO BE COMPLETED ONLY
SOLICITING DEALER BY DEPOSITARY
----------------------------------------------------------------
NUMBER OF NUMBER OF
SHARES VOI TICKET SHARES $.50 FEE
BENEFICIAL OWNERS TENDERED NUMBER* ACCEPTED PER SHARE
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
No. 1..............................
No. 2..............................
No. 3..............................
No. 4..............................
No. 5..............................
Total......................
</TABLE>
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST
BE SENT WITH THE LETTER OF TRANSMITTAL.
PLEASE COMPLETE THE SIGNATURE FORM ON THE LAST PAGE.
<PAGE> 12
NOTICE OF SOLICITED TENDERS FOR THE OPCO 6.02% SERIES
List below the number of Shares tendered by each beneficial owner whose
tender you have solicited. All Shares in a Series of Preferred beneficially
owned by a beneficial owner, whether in one account or several, and in however
many capacities, must be aggregated for purposes of completing the table below.
Any questions as to what constitutes beneficial ownership should be directed to
the Depositary. If the space below is inadequate, list the Shares in a separate
signed schedule and affix the list to this Notice of Solicited Tenders. PLEASE
DO NOT COMPLETE THE SECTIONS OF THE TABLE HEADED "TO BE COMPLETED ONLY BY
DEPOSITARY."
ALL NOTICES OF SOLICITED TENDERS SHOULD BE RETURNED TO, AND ALL QUESTIONS
CONCERNING THE NOTICES OF SOLICITED TENDERS SHOULD BE DIRECTED TO, THE
DEPOSITARY. ALL NOTICES OF SOLICITED TENDERS MUST BE RECEIVED BY THE DEPOSITARY
WITHIN THREE BUSINESS DAYS AFTER THE EXPIRATION DATE.
TENDERS ONLY
<TABLE>
<CAPTION>
TO BE COMPLETED BY TO BE COMPLETED ONLY
SOLICITING DEALER BY DEPOSITARY
----------------------------------------------------------------
NUMBER OF NUMBER OF
SHARES VOI TICKET SHARES $.50 FEE
BENEFICIAL OWNERS TENDERED NUMBER* ACCEPTED PER SHARE
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
No. 1.............................
No. 2.............................
No. 3.............................
No. 4.............................
No. 5.............................
Total.....................
</TABLE>
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST
BE SENT WITH THE LETTER OF TRANSMITTAL.
PLEASE COMPLETE THE SIGNATURE FORM ON THE LAST PAGE.
<PAGE> 13
NOTICE OF SOLICITED TENDERS FOR THE OPCO 6.35% SERIES
List below the number of Shares tendered by each beneficial owner whose
tender you have solicited. All Shares in a Series of Preferred beneficially
owned by a beneficial owner, whether in one account or several, and in however
many capacities, must be aggregated for purposes of completing the table below.
Any questions as to what constitutes beneficial ownership should be directed to
the Depositary. If the space below is inadequate, list the Shares in a separate
signed schedule and affix the list to this Notice of Solicited Tenders. PLEASE
DO NOT COMPLETE THE SECTIONS OF THE TABLE HEADED "TO BE COMPLETED ONLY BY
DEPOSITARY."
ALL NOTICES OF SOLICITED TENDERS SHOULD BE RETURNED TO, AND ALL QUESTIONS
CONCERNING THE NOTICES OF SOLICITED TENDERS SHOULD BE DIRECTED TO, THE
DEPOSITARY. ALL NOTICES OF SOLICITED TENDERS MUST BE RECEIVED BY THE DEPOSITARY
WITHIN THREE BUSINESS DAYS AFTER THE EXPIRATION DATE.
TENDERS ONLY
<TABLE>
<CAPTION>
TO BE COMPLETED BY TO BE COMPLETED ONLY
SOLICITING DEALER BY DEPOSITARY
---------------------------------------------------------------
NUMBER OF NUMBER OF
SHARES VOI TICKET SHARES $.50 FEE
BENEFICIAL OWNERS TENDERED NUMBER* ACCEPTED PER SHARE
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
No. 1.............................
No. 2.............................
No. 3.............................
No. 4.............................
No. 5.............................
Total.....................
</TABLE>
- ---------------
* Complete if Shares delivered by book-entry transfer. Please submit a separate
VOI ticket for Shares tendered when the solicitation fee is to be directed to
another Soliciting Dealer. At the time of tendering Shares in book-entry form,
please indicate your request in the comments field.
All questions as to the validity, form and eligibility (including time of
receipt) of any Notice of Solicited Tenders will be determined by the
Depositary, in its sole discretion, which determination will be final and
binding. Neither the Depositary nor any other person will be under any duty to
give notification of any defects or irregularities in any Notice of Solicited
Tenders or incur any liability for failure to give such notification.
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST
BE SENT WITH THE LETTER OF TRANSMITTAL.
PLEASE COMPLETE THE SIGNATURE FORM ON THE LAST PAGE.
<PAGE> 14
The undersigned hereby confirms that: (i) it has complied with the
applicable requirements of the Securities Exchange Act of 1934, as amended, and
the applicable rules and regulations thereunder, in connection with such
solicitation; (ii) it is entitled to such compensation for such solicitation
under the terms and conditions of the Offer; (iii) in soliciting tenders of
Shares, it has used no soliciting materials other than those furnished by AEP;
and (iv) if it is a foreign broker or dealer not eligible for membership in the
NASD, it has agreed to conform to the NASD's Rules of Fair Practice in making
solicitations.
<TABLE>
<S> <C>
- -------------------------------------------- --------------------------------------------
Firm Name Address (Including Zip Code)
- -------------------------------------------- --------------------------------------------
By: Area Code and Telephone Number
Title:
</TABLE>
<PAGE> 1
AMERICAN ELECTRIC POWER COMPANY, INC.
OFFER TO PURCHASE FOR CASH
ANY AND ALL OUTSTANDING SHARES OF THE FOLLOWING SERIES OF
CUMULATIVE PREFERRED STOCK OF
OHIO POWER COMPANY
<TABLE>
<C> <S>
202,403 SHARES, CUMULATIVE PREFERRED STOCK, 4-1/2% SERIES AT A PURCHASE PRICE OF $ 69.02 PER SHARE, CUSIP NUMBER 677415 40 8
42,575 SHARES, CUMULATIVE PREFERRED STOCK, 4.08% SERIES AT A PURCHASE PRICE OF $ 64.56 PER SHARE, CUSIP NUMBER 677415 10 1
51,975 SHARES, CUMULATIVE PREFERRED STOCK, 4.20% SERIES AT A PURCHASE PRICE OF $ 66.46 PER SHARE, CUSIP NUMBER 677415 20 0
88,363 SHARES, CUMULATIVE PREFERRED STOCK, 4.40% SERIES AT A PURCHASE PRICE OF $ 69.62 PER SHARE, CUSIP NUMBER 677415 30 9
404,000 SHARES, CUMULATIVE PREFERRED STOCK, 5.90% SERIES AT A PURCHASE PRICE OF $103.09 PER SHARE, CUSIP NUMBER 677415 79 6
395,000 SHARES, CUMULATIVE PREFERRED STOCK, 6.02% SERIES AT A PURCHASE PRICE OF $103.71 PER SHARE, CUSIP NUMBER 677415 81 2
300,000 SHARES, CUMULATIVE PREFERRED STOCK, 6.35% SERIES AT A PURCHASE PRICE OF $105.14 PER SHARE, CUSIP NUMBER 677415 82 0
</TABLE>
------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON FRIDAY, FEBRUARY 28, 1997, UNLESS THE OFFER IS EXTENDED.
------------------------
January 30, 1997
To Our Clients:
Enclosed for your consideration are the Offer to Purchase and Proxy
Statement, dated January 30, 1997, a proxy and a separate Letter of Transmittal
for each series of cumulative preferred stock listed above (each a "Series of
Preferred" and the holder thereof a "Preferred Shareholder") of Ohio Power
Company ("OPCo"), an Ohio corporation and direct utility subsidiary of American
Electric Power Company, Inc. ("AEP"), of which you own shares. As to each Series
of Preferred, the Offer to Purchase and Proxy Statement, together with the
applicable Letter of Transmittal, constitutes the "Offer" of AEP to purchase any
and all shares of the Series of Preferred ("Shares") at the purchase price per
Share listed above plus accrued and unpaid dividends, net to the seller in cash,
upon the terms and subject to the conditions of the Offer. AEP will purchase any
and all Shares validly tendered and not withdrawn, upon the terms and subject to
the conditions of the Offer. The Offer for a Series of Preferred is not
conditioned upon any minimum number of Shares of such Series of Preferred being
tendered and is independent of the Offer for any other Series of Preferred.
While Preferred Shareholders who wish to tender their Shares pursuant to the
Offer need not vote in favor of the proposed amendment to OPCo's Amended
Articles of Incorporation, as set forth in the Offer to Purchase and Proxy
Statement (the "Proposed Amendment"), the Offer is conditioned upon the Proposed
Amendment being approved and adopted at the Special Meeting (as defined in the
Offer to Purchase and Proxy Statement). OPCo's Board of Directors recommends
voting for the Proposed Amendment. In addition, Preferred Shareholders have the
right to vote for or against the Proposed Amendment regardless of whether they
tender their Shares. If the Proposed Amendment is approved and adopted by OPCo's
shareholders, OPCo will make a special cash payment in the amount of $1.00 per
Share to each Preferred Shareholder who voted in favor of the Proposed
Amendment, provided that such Shares have not been tendered pursuant to the
Offer. See "Proposed Amendment and Proxy Solicitation", "Terms of the Offer --
Certain Conditions of the Offer" and "Terms of the Offer -- Extension of Tender
Period; Termination; Amendments" in the Offer to Purchase and Proxy Statement.
WE ARE THE HOLDER OF RECORD OF SHARES HELD FOR YOUR ACCOUNT BUT NOT
REGISTERED IN YOUR NAME. A TENDER OR A VOTE OF SUCH SHARES CAN BE MADE ONLY BY
US AS THE HOLDER OF RECORD AND PURSUANT TO YOUR INSTRUCTIONS. ANY LETTER OF
TRANSMITTAL FURNISHED TO YOU IS SOLELY FOR YOUR INFORMATION AND CANNOT BE USED
BY YOU TO TENDER OR VOTE SHARES HELD BY US FOR YOUR ACCOUNT.
We request instructions as to whether you wish us to tender and/or vote any
or all of the Shares held by us for your account, upon the terms and subject to
the conditions set forth in the Offer.
PLEASE READ THE FOLLOWING INFORMATION CAREFULLY:
(1) The Offer is for any and all Shares outstanding as of January 30,
1997. The Offer for a Series of Preferred is independent of the Offer for
any other Series of Preferred.
(2) The Offer and withdrawal rights will expire at 5:00 p.m., New York
City time, on February 28, 1997, unless the Offer is extended with respect
to a Series of Preferred. Your instructions to us should be forwarded to us
in ample time to permit us to submit a tender on your behalf by the
expiration of the Offer. If you would like to withdraw your Shares that we
have tendered, you can withdraw them so long as the Offer remains open or at
any time after the expiration of forty business days from the commencement
of the Offer if such tendered Shares have not been accepted for payment.
(3) While Preferred Shareholders who wish to tender their Shares
pursuant to the Offer need not vote in favor of the Proposed Amendment, the
Offer is conditioned upon the Proposed Amendment being approved and adopted
at the Special Meeting.
(4) Preferred Shareholders have the right to vote for or against the
Proposed Amendment regardless of whether they tender their Shares. If the
Proposed Amendment is approved and adopted by OPCo's shareholders, OPCo will
make a special cash payment in the amount of $1.00 per Share to each
Preferred Shareholder who voted in favor of the Proposed Amendment, provided
that such Shares have not been tendered pursuant to the Offer.
(5) Any stock transfer taxes applicable to the sale of Shares to AEP
pursuant to the Offer will be paid by AEP, except as otherwise provided in
Instruction 6 of the Letter of Transmittal.
NEITHER AEP, OPCO, THEIR RESPECTIVE BOARDS OF DIRECTORS NOR ANY OF THEIR
RESPECTIVE OFFICERS MAKES ANY RECOMMENDATION TO ANY PREFERRED SHAREHOLDER AS TO
WHETHER TO TENDER ANY OR ALL
<PAGE> 2
SHARES. EACH PREFERRED SHAREHOLDER MUST MAKE HIS OR HER OWN DECISION AS TO
WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER.
If you wish to have us tender and/or vote any or all of your Shares held by
us for your account upon the terms and subject to the conditions set forth in
the Offer, please so instruct us by completing, executing, detaching and
returning to us the instruction form on the detachable part hereof. An envelope
to return your instructions to us is enclosed. If you authorize tender of your
Shares, all such Shares will be tendered unless otherwise specified on the
detachable part hereof. Your instructions should be forwarded to us in ample
time to permit us to submit a tender and/or vote on your behalf by the
expiration of the Offer or the Special Meeting, as applicable.
The Offer is being made to all holders of Shares. AEP is not aware of any
state where the making of the Offer is prohibited by administrative or judicial
action pursuant to a valid state statute. If AEP becomes aware of any valid
state statute prohibiting the making of the Offer, AEP will make a good faith
effort to comply with such statute. If, after such good faith effort, AEP cannot
comply with such statute, the Offer will not be made to, nor will tenders be
accepted from or on behalf of, holders of Shares in such state. In those
jurisdictions where the securities, blue sky or other laws require the Offer to
be made by a licensed broker or dealer, the Offer shall be deemed to be made on
behalf of AEP by the Dealer Managers (as defined in the Offer) or one or more
registered brokers or dealers licensed under the laws of such jurisdictions.
INSTRUCTIONS
WITH RESPECT TO OFFER TO PURCHASE FOR CASH
ANY AND ALL OUTSTANDING SHARES OF
THE PREFERRED STOCK OF,
AND PROXY SOLICITATION BY,
OHIO POWER COMPANY
The undersigned acknowledge(s) receipt of your letter and the enclosed
Offer to Purchase and Proxy Statement, dated January 30, 1997, proxy and a
separate Letter of Transmittal for each series of preferred stock of Ohio Power
Company (each a "Series of Preferred") in which the undersigned owns shares (as
to each Series of Preferred, the Offer to Purchase and Proxy Statement, together
with the applicable Letter of Transmittal, constitutes the "Offer") in
connection with the invitation of American Electric Power Company, Inc. ("AEP")
to the holders of each Series of Preferred to tender any and all of their shares
of a Series of Preferred ("Shares") for purchase at the purchase price per Share
listed on the front cover of the Offer to Purchase and Proxy Statement plus
accrued and unpaid dividends, net to the seller in cash, upon the terms and
subject to the conditions of the Offer, and in connection with the proxy
solicitation being conducted by the Board of Directors of Ohio Power Company.
This will instruct you to tender to AEP the number of Shares indicated
below (or, if no number is indicated below, all Shares) which are held by you
for the account of the undersigned, upon the terms and subject to the conditions
of the Offer.
<TABLE>
<CAPTION>
SERIES OF PREFERRED NUMBER OF SHARES TO BE TENDERED*
<S> <C>
- ------------------------------------------------- -------------------------------------------------
- ------------------------------------------------- -------------------------------------------------
- ------------------------------------------------- -------------------------------------------------
- ------------------------------------------------- -------------------------------------------------
- ------------------------------------------------- -------------------------------------------------
</TABLE>
You are further instructed to vote as designated hereunder in respect of
the Proposed Amendment all shares which the undersigned is entitled to vote at
the Special Meeting:**
[ ] FOR [ ] AGAINST [ ] ABSTAIN
SIGN HERE
SIGNATURE(S):
---------------------------------------------------------------------------
NAME(S):
---------------------------------------------------------------------------
ADDRESS:
---------------------------------------------------------------------------
DATED: ____________, 1997
SOCIAL SECURITY OR TAXPAYER IDENTIFICATION NO.:__________________
- ---------------
* By executing and returning these Instructions, unless otherwise indicated, it
will be assumed that all Shares held by us for your account are to be
tendered.
** By executing and returning these Instructions, unless otherwise indicated, it
will be assumed that all Shares held by us for your account are to be voted
FOR the Proposed Amendment.
<PAGE> 1
January 30, 1997
Dear Preferred Shareholder:
Enclosed for your consideration is information pertaining to Ohio Power Company.
We ask that you take one of the following actions:
1. If you wish to accept the Offer and tender your shares:
- Complete, sign, and date the pink Letter of Transmittal in accordance
with the instructions in the Letter of Transmittal.
- Enclose the Letter of Transmittal and related certificates in the brown
envelope addressed to First Chicago at: Tenders & Exchanges, P.O. Box
2569, Suite 4660, Jersey City, New Jersey, 07303-2569.
- In addition, even if you tender, please vote, sign and date the grey
proxy card and enclose in the white envelope addressed to First Chicago
at: Tenders and Exchange, P.O. Box 2714, Jersey City, N.J. 07303-9714.
PLEASE BE AWARE THAT THE OFFER IS CONDITIONED UPON SHAREHOLDERS
APPROVING THE PROPOSED AMENDMENT. A FAILURE TO RETURN A PROXY IS A VOTE
AGAINST. (Please note that you cannot receive a Special Cash Payment if
you tender your shares).
2. If you wish to receive the Special Cash Payment, you must vote:
- If you do not want to accept the Offer, you still must vote yes in order
to receive the Special Cash Payment. Please vote by signing and dating
the grey proxy card. A FAILURE TO RETURN A PROXY IS A VOTE AGAINST.
- Enclose your completed proxy card in the white envelope addressed to
First Chicago at: Tenders & Exchanges, P.O. Box 2714, Jersey City, New
Jersey 07303-9714.
If you have any questions on how to tender or vote your shares, please call our
proxy solicitor:
Morrow & Co., Inc. at (800) 566-9061
<PAGE> 2
January 30, 1997
Dear Preferred Shareholder:
Enclosed for your consideration is information pertaining to Ohio Power
Company. We ask that you take one of the following actions.
1. If you wish to accept the Offer and tender your shares:
- Please direct your commercial bank, broker, trust company or other nominee
to effect the transaction on your behalf.
- Have the aforementioned party vote the grey proxy card. PLEASE BE AWARE
THAT THE OFFER IS CONDITIONED UPON SHAREHOLDERS APPROVING THE PROPOSED
AMENDMENT. A FAILURE TO RETURN A PROXY IS A VOTE AGAINST. (Please note
that you cannot receive a special cash payment if you tender your shares).
2. If you wish to receive the Special Cash Payment, you must vote:
If you do not want to accept the offer, you still must vote yes in order
to receive the special cash payment. Please direct your commercial bank,
broker, trust company or other nominee to vote a grey proxy on your
behalf. A FAILURE TO RETURN A PROXY IS A VOTE AGAINST.
If you have any questions on how to tender or vote your shares, please
call
our proxy solicitor:
Morrow & Co., Inc. at (800) 566-9061
<PAGE> 1
This announcement is neither an offer to purchase nor a solicitation of an
offer to sell Shares. The Offer is made solely by the Offer to Purchase and
Proxy Statement dated January 30, 1997 and the related Letter of Transmittal,
and is being made to all holders of Shares. AEP is not aware of any
jurisdiction where the making of the Offer or the tender of Shares is not in
compliance with any applicable law. If AEP becomes aware of any jurisdiction
where the making of the Offer or the tender of Shares is not in compliance with
any applicable law, AEP will make a good faith effort to comply with such law.
If, after such good faith effort, AEP cannot comply with such law, the Offer
will not be made to (nor will tenders be accepted from or on behalf of) the
owners of Shares residing in such jurisdiction. In any jurisdiction where the
securities, blue sky or other laws require the Offer to be made by a licensed
broker or dealer, the Offer shall be deemed to be made on behalf of AEP by
Merrill Lynch & Co., Salomon Brothers Inc or one or more registered brokers or
dealers licensed under the laws of such jurisdiction.
AMERICAN ELECTRIC POWER COMPANY, INC.
NOTICE OF OFFER TO PURCHASE FOR CASH
ANY AND ALL OUTSTANDING SHARES OF THE FOLLOWING
SERIES OF CUMULATIVE PREFERRED STOCK OF
APPALACHIAN POWER COMPANY
298,150 Shares, Cumulative Preferred Stock, 4-1/2% Series at a
Purchase Price of $69.02 Per Share CUSIP Number 037735 10 7
500,000 Shares, Cumulative Preferred Stock, 5.90% Series at a
Purchase Price of $103.17 Per Share CUSIP Number 037735 84 2
600,000 Shares, Cumulative Preferred Stock, 5.92% Series at a
Purchase Price of $103.20 Per Share CUSIP Number 037735 85 9
300,000 Shares, Cumulative Preferred Stock, 6.85% Series at a
Purchase Price of $107.26 Per Share CUSIP Number 037735 83 4
500,000 Shares, Cumulative Preferred Stock, 7.80% Series at a
Purchase Price of $105.50 Per Share CUSIP Number 037735 86 7
INDIANA MICHIGAN POWER COMPANY
119,767 Shares, Cumulative Preferred Stock, 4-1/4% Series at a
Purchase Price of $62.31 Per Share CUSIP Number 454889 30 4
40,000 Shares, Cumulative Preferred Stock, 4.12% Series at a
Purchase Price of $64.17 Per Share CUSIP Number 454889 20 5
60,000 Shares, Cumulative Preferred Stock, 4.56% Series at a
Purchase Price of $69.94 Per Share CUSIP Number 454889 82 5
400,000 Shares, Cumulative Preferred Stock, 5.90% Series at a
Purchase Price of $101.83 Per Share CUSIP Number 454889 85 8
300,000 Shares, Cumulative Preferred Stock, 6-1/4% Series at a
Purchase Price of $103.79 Per Share CUSIP Number 454889 84 1
300,000 Shares, Cumulative Preferred Stock, 6-7/8% Series at a
Purchase Price of $106.45 Per Share CUSIP Number 454889 86 6
350,000 Shares, Cumulative Preferred Stock, 6.30% Series at a
Purchase Price of $103.71 Per Share CUSIP Number 454889 83 3
OHIO POWER COMPANY
202,403 Shares, Cumulative Preferred Stock, 4-1/2% Series at a
Purchase Price of $69.02 Per Share CUSIP Number 677415 40 8
42,575 Shares, Cumulative Preferred Stock, 4.08% Series at a
Purchase Price of $64.56 Per Share CUSIP Number 677415 10 1
51,975 Shares, Cumulative Preferred Stock, 4.20% Series at a
Purchase Price of $66.46 Per Share CUSIP Number 677415 20 0
88,363 Shares, Cumulative Preferred Stock, 4.40% Series at a
Purchase Price of $69.62 Per Share CUSIP Number 677415 30 9
404,000 Shares, Cumulative Preferred Stock, 5.90% Series at a
Purchase Price of $103.09 Per Share CUSIP Number 677415 79 6
395,000 Shares, Cumulative Preferred Stock, 6.02% Series at a
Purchase Price of $103.71 Per Share CUSIP Number 677415 81 2
300,000 Shares, Cumulative Preferred Stock, 6.35% Series at a
Purchase Price of $105.14 Per Share CUSIP Number 677415 82 0
American Electric Power Company, Inc. ("AEP"), a New York corporation,
invites the holders of
(i) each series of cumulative preferred stock listed above of
Appalachian Power Company ("APCo"), a Virginia corporation and
direct utility subsidiary of AEP (each, a "Series of APCo
Preferred"), to tender any and all of their shares of a Series of
APCo Preferred ("APCo Shares") for purchase at the price per share
listed above plus accrued and unpaid dividends for the APCo Shares
tendered, net to the seller in cash, upon the terms and subject to
the conditions set forth in the Offer to Purchase and Proxy
Statement dated January 30, 1997 and in the related Letter of
Transmittal (which together constitute the "APCo Offer");
(ii) each series of cumulative preferred stock listed above of Indiana
Michigan Power Company ("I&M"), an Indiana corporation and direct
utility subsidiary of AEP (each, a "Series of I&M Preferred"), to
tender any and all of their shares of a Series of I&M Preferred
("I&M Shares") for purchase at the price per share listed above
plus accrued and unpaid dividends for the I&M Shares tendered,
net to the seller in cash, upon the terms and subject to the
conditions set forth in the Offer to Purchase and Proxy Statement
dated January 30, 1997 and in the related Letter of Transmittal
(which together constitute the "I&M Offer"); and
(iii) each series of cumulative preferred stock listed above of Ohio
Power Company ("OPCo"), an Ohio corporation and direct utility
subsidiary of AEP (each, a "Series of OPCo Preferred"), to tender
any and all of their shares of a Series of OPCo Preferred ("OPCo
Shares") for purchase at the price per share listed above plus
accrued and unpaid dividends for the OPCo Shares tendered, net to
the seller in cash, upon the terms and subject to the conditions
set forth in the Offer to Purchase and Proxy Statement dated
January 30, 1997 and in the related Letter of Transmittal (which
together constitute the "OPCo Offer").
For the purposes of this Notice, APCo, I&M and OPCo are collectively
referred to as the "Company"; the Series of APCo Preferred, the Series of I&M
Preferred and the Series of OPCo Preferred are collectively referred to as the
"Series of Preferred"; the APCo Shares, the I&M Shares and the OPCo Shares are
collectively referred to as the "Shares"; and the APCo Offer, the I&M Offer and
the OPCo Offer are collectively referred to as the "Offer."
----------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME,
ON FRIDAY, FEBRUARY 28, 1997 (THE "EXPIRATION DATE"), UNLESS THE OFFER IS
EXTENDED.
----------------------------------------------------------------------------
THE OFFER FOR A SERIES OF PREFERRED IS NOT CONDITIONED UPON ANY MINIMUM
NUMBER OF SHARES OF SUCH SERIES OF PREFERRED BEING TENDERED AND IS INDEPENDENT
OF THE OFFER FOR ANY OTHER SERIES OF PREFERRED. THE OFFER OF EACH COMPANY,
HOWEVER, IS CONDITIONED UPON, AMONG OTHER THINGS, THE PROPOSED AMENDMENT, AS
DESCRIBED BELOW, BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING RELATING TO
SUCH COMPANY. SEE "TERMS OF THE OFFER -- CERTAIN CONDITIONS OF THE OFFER" IN
THE OFFER TO PURCHASE AND PROXY STATEMENT WITH RESPECT TO EACH COMPANY.
Concurrently with each Offer, the Board of Directors of each Company is
soliciting proxies for use at the Special Meeting of Shareholders of each
Company to be held at AEP's principal office, 1 Riverside Plaza, Columbus, Ohio
43215, on February 28, 1997 or any adjournment or postponement of such meetings
(collectively, the "Special Meeting"). Each Special Meeting is being held to
consider amendments (collectively, the "Proposed Amendment") to each Company's
articles of incorporation (collectively, the "Articles") which would remove
similar provisions of each Company's Articles that limit each Company's ability
to issue debt. The Board of Directors of each Company recommends voting for the
Proposed Amendments relating to such Company. WHILE TENDERING HOLDERS OF A
SERIES OF PREFERRED OF EACH COMPANY NEED NOT VOTE IN FAVOR OF THE PROPOSED
AMENDMENT RELATING TO SUCH COMPANY, THE OFFER, WITH RESPECT TO SUCH COMPANY, IS
CONDITIONED UPON SUCH PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT SUCH
COMPANY'S SPECIAL MEETING. IN ADDITION, RECORD HOLDERS OF EACH COMPANY'S SHARES
HAVE THE RIGHT TO VOTE FOR OR AGAINST THE PROPOSED AMENDMENT RELATING TO SUCH
COMPANY REGARDLESS OF WHETHER THEY TENDER THEIR SHARES. IF A PROPOSED AMENDMENT
IS APPROVED AND ADOPTED BY A COMPANY'S HOLDERS, THE COMPANY WILL MAKE A SPECIAL
CASH PAYMENT IN THE AMOUNT OF $1.00 PER SHARE TO EACH HOLDER WHO VOTED IN FAVOR
OF THE PROPOSED AMENDMENT, PROVIDED THAT SUCH SHARES HAVE NOT BEEN TENDERED
PURSUANT TO THE OFFER. THOSE HOLDERS WHO VALIDLY TENDER THEIR SHARES WILL BE
ENTITLED ONLY TO THE PURCHASE PRICE PER SHARE LISTED ABOVE.
Any holder of a Series of Preferred desiring to accept the Offer and
tender all or any portion of his or her Shares should either (i) request his or
her broker, dealer, commercial bank, trust company or nominee to effect the
transaction for him or her, or (ii) complete and sign the Letter of Transmittal
in accordance with the instruction in the Letter of Transmittal, mail or
deliver the same and any other required documents to First Chicago Trust
Company of New York (The "Depositary"), and deliver the certificates for such
Shares to the Depositary, along with the Letter of Transmittal, or tender such
Shares pursuant to the procedure for book-entry transfer set forth in the
applicable Offer to Purchase and Proxy Statement under "Terms of the Offer --
Procedures of Tendering Shares," on or prior to the Expiration Date (set forth
above). A holder of a Series of Preferred whose Shares are registered in the
name of a broker, dealer, commercial bank, trust company or nominee must
contact such broker, dealer, commercial bank, trust company or nominee if he or
she desires to tender such Shares. Any holder of a Series of Preferred who
desires to tender Shares and whose certificates for such Shares are not
immediately available, or who cannot comply in a timely manner with the
procedure for book-entry transfer, should tender such Shares by following the
procedures for guaranteed delivery set forth in the applicable Offer to
Purchase and Proxy Statement under "Terms of the Offer -- Procedures for
Tendering Shares." AEP will pay to each soliciting dealer a solicitation fee
for any Shares tendered, accepted for payment and paid pursuant to the Offer.
See "Fees And Expenses Paid To Dealers" in each Company's Offer to Purchase and
Proxy Statement.
EACH SERIES OF PREFERRED HAS ITS OWN LETTER OF TRANSMITTAL, AND ONLY
THE APPLICABLE LETTER OF TRANSMITTAL FOR SUCH SERIES OF PREFERRED OR A NOTICE
OF GUARANTEED DELIVERY MAY BE USED TO TENDER SHARES OF SUCH SERIES OF PREFERRED.
NEITHER AEP, APCO, I&M, OPCO, THEIR RESPECTIVE BOARDS OF DIRECTORS, NOR
ANY OF THEIR RESPECTIVE OFFICERS MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS
TO WHETHER TO TENDER ANY OR ALL SHARES. EACH SHAREHOLDER MUST MAKE HIS OR HER
OWN DECISION AS TO WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO
TENDER.
The Offer to Purchase and Proxy Statement with respect to each Company
is first being mailed on or about January 30, 1997 to Preferred Shareholders of
record on January 27, 1997.
THE OFFER TO PURCHASE AND PROXY STATEMENT AND THE RELATED LETTER OF
TRANSMITTAL CONTAIN IMPORTANT INFORMATION WHICH SHOULD BE READ BEFORE ANY
DECISION IS MADE WITH RESPECT TO THE OFFER.
Questions and requests for assistance may be directed to the
Information Agent or the Dealer Managers as set forth below. Requests for
copies of the Offer to Purchase and Proxy Statement and the related Letter of
Transmittal or other tender offer or proxy materials may be directed to the
Information Agent and such copies will be furnished promptly at AEP's expense.
Preferred Shareholders may also contact their local broker, dealer, commercial
bank or trust company for assistance concerning the Offer.
The Information Agent for the Offer is:
MORROW & CO., INC.
909 Third Avenue
New York, New York 10022-4799
(800) 566-9061 (Toll Free)
or
(212) 754-8000
The Dealer Managers for the Offer are:
MERRILL LYNCH & CO. SALOMON BROTHERS INC
World Financial Center Seven World Trade Center
250 Vesey Street New York, New York 10048
New York, New York 10281-1330 Attn: Liability Management Group
1-888-ML4-TNDR (Toll Free) 1-800-558-3745 (Toll Free)
(1-888-654-8637 (Toll Free))
January 30, 1997
<PAGE> 1
LOGO
OHIO POWER COMPANY
301 CLEVELAND AVENUE, S.W.
CANTON, OHIO 44702
January 30, 1997
Dear Shareholder:
Please find enclosed important information pertaining to the following two
items:
(i) a proposed amendment to the Amended Articles of Incorporation (the
"Articles") of Ohio Power Company ("OPCo" or "the Company") which will be
considered at a Special Meeting of its shareholders; and
(ii) an offer by American Electric Power Company, Inc. ("AEP") to
purchase the outstanding shares of OPCo's cumulative preferred stock.
We will greatly appreciate your giving prompt attention to the enclosed
material which you are urged to read in its entirety.
The Articles presently limit OPCo's ability to issue securities
representing unsecured indebtedness, including short-term debt, to no more than
10% of the aggregate of its capital, surplus and secured debt. This debt
restriction limits OPCo's flexibility in planning and financing its business
activities. With financial flexibility and capital cost reduction being crucial
factors to being successful in the evolving competitive utility environment,
OPCo ultimately may be placed at a competitive disadvantage if this debt
restriction is not removed from the Articles. The proposed amendment, as set
forth and explained in the enclosed Offer to Purchase and Proxy Statement, would
remove the debt restriction.
Concurrently with OPCo's proxy solicitation, AEP is offering to purchase
the outstanding shares of OPCo's cumulative preferred stock. While you need not
vote in favor of the proposed amendment in order to tender your shares, AEP's
offer is conditioned upon, among other things, the proposed amendment being
approved and adopted at the Special Meeting. In addition, you have the right to
vote for or against the proposed amendment regardless of whether you tender your
shares. If you vote in favor of the proposed amendment and it passes, you will
be entitled to receive a special cash payment in the amount of $1.00 per share
for each share that you vote, provided your shares have not been tendered.
Instructions for tendering your shares and information pertaining to the special
cash payment are included with the enclosed material.
It is important to your interests that all shareholders, regardless of the
number of shares owned, participate in the affairs of the Company. Even if you
plan to attend the Special Meeting, WE URGE YOU TO MARK, SIGN AND DATE THE
ENCLOSED PROXY AND RETURN IT PROMPTLY. By signing and returning your proxy
promptly, you are assuring that your shares will be voted.
You are cordially invited to attend the Special Meeting which will be held
at AEP's principal office, 1 Riverside Plaza, Columbus, Ohio, on Friday,
February 28, 1997 at 4:30 p.m., eastern standard time or any adjournment or
postponement of such meeting.
If you have questions regarding the proposed amendment, the Special
Meeting, or AEP's tender offer please call directed to Merrill Lynch & Co. at
(888) ML4-TNDR ((888) 654-8637 (toll free)) or Salomon Brothers Inc at (800)
558-3745 (toll free).
Thank you for your continued interest in the Company.
Sincerely yours,
LOGO
E. Linn Draper, Jr.
Chairman of the Board and
Chief Executive Officer
<PAGE> 1
EXHIBIT 99(a)(9)
Media Contact: ___________________________ 614-223-____ (w) 614-___-____ (h)
___________________________ 614-___-____ (w) 614-___-____ (h)
Investor Contact: ________________________ 614-___-____
FOR IMMEDIATE RELEASE - January 30, 1997
APPALACHIAN POWER, INDIANA MICHIGAN POWER AND OHIO POWER SEEK ARTICLES
AMENDMENTS AT SPECIAL MEETINGS;
AMERICAN ELECTRIC POWER ANNOUNCES TENDER OFFER FOR APPALACHIAN POWER, INDIANA
MICHIGAN POWER AND OHIO POWER PREFERRED STOCK
COLUMBUS The boards of directors of Appalachian Power Company, Indiana
Michigan Power Company and Ohio Power Company, each a utility subsidiary of
American Electric Power Company, Inc. (NYSE:AEP), are soliciting proxies for
use at a special meeting of shareholders to be held on February 28, 1997. The
special meetings are being held to consider an amendment to each subsidiary's
articles of incorporation. The amendment would remove a provision of the
articles that limits the subsidiaries' ability to issue debt, including
short-term debt. These debt restrictions limit the subsidiaries' flexibility in
planning and financing their business activities. Since financial flexibility
and capital cost reduction are crucial factors to being successful in the
evolving competitive utility environment, the subsidiaries ultimately may be
placed at a competitive disadvantage if the debt restrictions are not removed.
Currently, power marketers, independent power producers and other utilities who
have taken similar action are not hampered by these debt restrictions.
If a proposed amendment is approved and adopted, the subsidiary will
make a special cash payment in the amount of $1.00 per share to each preferred
shareholder who voted in favor of the proposed amendment, provided that such
shares are not tendered pursuant to AEP's offer. Those preferred shareholders
who validly tender their shares will be entitled only to the purchase price per
share listed below.
In conjunction with the special meeting and proxy, AEP announced today
that it will offer to purchase for cash any and all outstanding shares of
preferred stock of Appalachian Power Company, Indiana Michigan Power Company
and Ohio Power Company. The tender offers commence on Thursday, January 30,
1997 and are scheduled to expire at 5:00 p.m. EDT on Friday, February 28, 1997,
unless extended.
Each of AEP's tender offers is conditioned upon, among other things,
the proposed amendment being approved and adopted at the special meeting. In
addition, preferred shareholders have the right to vote for or against the
proposed amendment regardless of whether they tender their shares.
<PAGE> 2
The series of preferred stock that AEP is offering to purchase and the
applicable purchase price are as follows:
Purchase Price
Title of Series (per share)
Appalachian Power Company,
Cumulative Preferred Stock (no par value)
- 4-1/2% Series $ 69.02
- 5.90% Series $103.17
- 5.92% Series $103.20
- 6.85% Series $107.26
- 7.80% Series $105.50
Indiana Michigan Power Company,
Cumulative Preferred Stock ($100 par value)
- 4-1/8% Series $ 62.31
- 4.12% Series $ 64.17
- 4.56% Series $ 69.94
- 5.90% Series $101.83
- 6-1/4% Series $103.79
- 6-7/8% Series $106.45
- 6.30% Series $103.71
Ohio Power Company,
Cumulative Preferred Stock ($100 par value)
- 4-1/2% Series $ 69.02
- 4.08% Series $ 64.56
- 4.20% Series $ 66.46
- 4.40% Series $ 69.62
- 5.90% Series $103.09
- 6.02% Series $103.71
- 6.35% Series $105.14
In addition, an amount equal to any accrued and unpaid dividends on the
tendered shares will be added to the above tender price.
The Dealer Managers for the tender offer are Merrill Lynch & Co. and
Salomon Brothers Inc, the Information Agent is Morrow & Co. and the Depositary
is First Chicago Trust Company of New York.
<PAGE> 1
Exhibit 99(d)
January 30, 1997
American Electric Power Company, Inc.
1 Riverside Plaza
Columbus, Ohio 43215
Ohio Power Company
301 Cleveland Avenue, S.W.
Canton, Ohio 44702
Ladies and Gentlemen:
We have acted as special counsel to American Electric Power
Company, Inc. (the "Company") and Ohio Power Company ("OPCo") in connection with
the Company's tender offer for any and all of the outstanding shares of certain
series of cumulative preferred stock (as listed on Schedule A attached hereto)
of OPCo (the "Preferred").
We have examined (i) the Offer to Purchase and Proxy Statement
for the Preferred dated January 30, 1997 (the "Offer to Purchase and Proxy
Statement"), which incorporates by reference the Annual Reports on Form 10-K of
the Company and OPCo for the fiscal year ended December 31, 1995, the Quarterly
Reports on Form 10-Q of the Company and OPCo for the interim periods ended March
31, 1996, June 30, 1996, and September 30, 1996 and the Current Reports on Form
8-K of the Company and OPCo
<PAGE> 2
American Electric Power Company, Inc. -2- January 30, 1997
Ohio Power Company
dated December 23, 1996 (the "OPPS Exchange Act Documents"), each as filed under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), (ii) the
Schedule 13E-4 for the Preferred, dated January 29, 1997, filed by the Company
under the Exchange Act, including the related exhibits thereto, which Schedule
13E-4 incorporates by reference the OPPS Exchange Act Documents and the
Quarterly Report on Form 10-Q of OPCo for the interim period ended September 30,
1995, each as filed under the Exchange Act, and (iii) the Letters of Transmittal
for the Preferred. In addition, we have examined, and have relied as to matters
of fact upon, the originals or copies, certified or otherwise identified to our
satisfaction, of such corporate records, agreements, documents and other
instruments and such certificates or comparable documents of public officials
and of officers and representatives of the Company and OPCo, and have made such
other and further investigations as we have deemed relevant and necessary as a
basis for the opinion hereinafter set forth.
In such examination, we have assumed the genuineness of all
signatures, the legal capacity of all natural persons, the authenticity of all
documents submitted to us as originals, the conformity to original documents of
all documents submitted to us as drafts or as certified, conformed, photostatic
or facsimile copies, and the authenticity of originals of such latter documents.
Based upon the foregoing, and subject to the qualifications and
limitations stated herein, we hereby advise you that the statements made in the
Offer to Purchase and Proxy Statement under the caption "Certain Federal Income
Tax Consequences,"
<PAGE> 3
American Electric Power Company, Inc. -3- January 30, 1997
Ohio Power Company
insofar as they purport to constitute summaries of matters of United States
federal income tax law and regulations or legal conclusions with respect
thereto, constitute accurate summaries of the matters described therein in all
material respects.
We are members of the Bar of the State of New York and we do not
express any opinion herein concerning any law other than the federal income tax
law of the United States.
We hereby consent to the reference to our firm under the caption
"Certain Federal Income Tax Consequences" in the Offer to Purchase and Proxy
Statement.
Very truly yours,
/s/Simpson Thacher & Bartlett
-----------------------------
SIMPSON THACHER & BARTLETT
<PAGE> 4
SCHEDULE A
LIST OF THE SHARES
Ohio Power Company
1. Cumulative Preferred Stock, 4-1/2% Series (par value $100 per share)
2. Cumulative Preferred Stock, 4.08% Series (par value $100 per share)
3. Cumulative Preferred Stock, 4.20% Series (par value $100 per share)
4. Cumulative Preferred Stock, 4.40% Series (par value $100 per share)
5. Cumulative Preferred Stock, 5.90% Series (par value $100 per share)
6. Cumulative Preferred Stock, 6.02% Series (par value $100 per share)
7. Cumulative Preferred Stock, 6.35% Series (par value $100 per share)
