File No. 70-8429
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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POST-EFFECTIVE AMENDMENT NO. 6
TO
FORM U-1
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APPLICATION OR DECLARATION
under the
PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
* * *
AMERICAN ELECTRIC POWER COMPANY, INC.
AEP RESOURCES, INC.
1 Riverside Plaza, Columbus, Ohio 43215
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(Name of company or companies filing this statement
and addresses of principal executive offices)
* * *
AMERICAN ELECTRIC POWER COMPANY, INC.
1 Riverside Plaza, Columbus, Ohio 43215
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(Name of top registered holding company
parent of each applicant or declarant)
* * *
Susan Tomasky, General Counsel
AMERICAN ELECTRIC POWER SERVICE CORPORATION
1 Riverside Plaza, Columbus, Ohio 43215
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(Names and addresses of agents for service)
American Electric Power Company, Inc. ("AEP"), a registered holding
company under the Public Utility Holding Company Act of 1935, as amended ("1935
Act"), and its subsidiary, AEP Resources, Inc. ("Resources"), hereby amend their
Application-Declaration on Form U-1 in File No. 70-8429 by restating the text
appearing after the caption, 'Compliance with Rule 54' as follows. In all other
respects the Application-Declaration as previously filed and amended will remain
the same.
"Compliance with Rule 54
Rule 54 provides that in determining whether to approve certain
transactions other than those involving an exempt wholesale generator ('EWG') or
a foreign utility company ('FUCO'), as defined in the 1935 Act, the Commission
will not consider the effect of the capitalization or earnings of any subsidiary
which is an EWG or FUCO if Rule 53(a), (b) and (c) are satisfied. All applicable
conditions of Rule 53(a) are currently satisfied except for clause (1). As of
September 30, 2000, AEP, through its subsidiaries, had an aggregate investment
in EWGs and FUCOs of $1,865,869,000. This investment represents approximately
53.2% of $3,509,500,000, the average of the consolidated retained earnings of
AEP reported on Forms 10-Q and 10-K for the four consecutive quarters ended
September 30, 2000. AEP consummated the merger with Central and South West
Corporation ('CSW') on June 15, 2000 pursuant to an order dated June 14, 2000
(HCAR No. 27186), which further authorized AEP to invest up to 100% of its
consolidated retained earnings, with consolidated retained earnings to be
calculated on the basis of the combined consolidated retained earnings of AEP
and CSW (the '100% Order'). Although AEP's aggregate investment exceeds the 50%
'safe harbor' limitation contained in Rule 53, AEP's aggregate investment is
below the 100% limitation authorized under the 100% Order.
As of December 31, 1999, the most recent period for which financial
statement information was evaluated in the 100% Order, AEP's consolidated
capitalization (including CSW on a pro forma basis) consisted of 37.3% common
and preferred equity and 62.7% debt. As of September 30, 2000, AEP's
consolidated capitalization consisted of 63.9% debt and 36.1% common and
preferred equity, consisting of 330,993,401 shares of common stock representing
35.4% and $161 million principal amount of preferred securities representing
0.7%. AEP believes this ratio remains within acceptable ranges and limits.
Further, AEP's interests in EWGs and FUCOs have contributed positively to its
consolidated earnings since the date of the 100% Order.
As of December 31, 1999, Standard & Poor's rating of secured debt for
AEP's Operating Subsidiaries was as follows: APCo, A; CSP, A-; I&M, A-; KPCo, A;
and OPCo, A-. As of December 31, 1999, Standard & Poor's rating of secured debt
for CSW's Operating Subsidiaries was as follows: Central Power and Light Company
('CPL') A; Public Service Company of Oklahoma ('PSO'), AA-; Southwestern
Electric Power Company ('SWEPCo'), AA-; and West Texas Utilities Company
('WTU'), A.
As of September 30, 2000, Standard & Poor's rating of secured debt for
AEP's Operating Subsidiaries was as follows: APCo, A; CSP, A-; I&M, A-; KPCo, A-
and OPCo, A-. As of September 30, 2000, Standard & Poor's rating of secured debt
for CSW's Operating Subsidiaries was as follows: CPL, A-; PSO, A; SWEPCo, A; and
WTU, A-.
AEP will continue to maintain in conformity with United States generally
accepted accounting principles and make available the books and records required
by Rule 53(a)(2). AEP does, and will continue to, comply with the requirement
that no more than 2% of the employees of AEP's electric utility operating
subsidiaries shall, at any one time, directly or indirectly, render services to
an EWG or FUCO in which AEP directly or indirectly owns an interest, satisfying
Rule 53(a)(3). And lastly, AEP will continue to submit a copy of Item 9 and
Exhibits G and H of AEP's Form U5S to each of the public service commissions
having jurisdiction over the retail rates of AEP's electric utility operating
subsidiaries, satisfying Rule 53(a)(4). Rule 53(c) is inapplicable by its terms
because the proposals contained herein do not involve the issue and sale of
securities (including any guarantees) to finance an acquisition of an EWG or
FUCO.
Rule 53(b). (i) Neither AEP nor any subsidiary of AEP is the subject of
any pending bankruptcy or similar proceeding; (ii) AEP's average consolidated
retained earnings for the four most recent quarterly periods ($3,509,500,000)
represented a decrease of approximately $9,490,000 (or 0.003%) in the average
consolidated retained earnings from the previous four quarterly periods
($3,518,990,000); and (iii) for the fiscal year ended December 31, 1999, AEP did
not report operating losses attributable to AEP's direct or indirect investments
in EWGs and FUCOs.
As noted, AEP was authorized to invest up to 100% of its consolidated
retained earnings in EWGs and FUCOs. In connection with its consideration of
AEP's application for the 100% Order and preceding Orders, the Commission
reviewed AEP's procedures for evaluating EWG or FUCO investments. Based on
projected financial ratios and on procedures and conditions established to limit
the risks to AEP involved with investments in EWGs and FUCOs, the Commission
determined that permitting AEP to invest up to 100% of its consolidated retained
earnings in EWGs and FUCOs would not have a substantial adverse impact upon the
financial integrity of the AEP, nor would it have an adverse impact on any of
its electric utility operating subsidiaries or their customers, or on the
ability of state commissions to protect the electric utility operating
subsidiaries or their customers."
SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act of
1935, the undersigned companies have duly caused this statement to be signed on
their behalf by the undersigned thereunto duly authorized.
AMERICAN ELECTRIC POWER COMPANY, INC.
AEP RESOURCES, INC.
By: /s/ John F. Di Lorenzo, Jr.
John F. Di Lorenzo, Jr.
Secretary
Dated: December 14, 2000
