UNITED STATES OF AMERICA
before the
SECURITIES AND EXCHANGE COMMISSION
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In the Matter of :
:
OHIO POWER COMPANY :
301 Cleveland Avenue, SW : CERTIFICATE OF
Canton, Ohio 44701 : NOTIFICATION
:
File No. 70-6373 :
:
(Public Utility Holding Company Act of 1935) :
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OHIO POWER COMPANY (the "Company") hereby certifies, in connection with
the Application or Declaration on Form U-1 in the above-entitled matter, that
the transactions specified in Post-Effective Amendment No. 4 to the Application
or Declaration have been carried out in accordance with the terms and conditions
of and for the purposes represented by said Post-Effective Amendment, and the
Order of the Securities and Exchange Commission dated April 7, 1999 in said
matter, as follows:
1. On May 13, 1999, the Ohio Air Quality Development Authority (the
"Authority") issued and sold to Goldman, Sachs & Co. (the "Underwriter")
$50,000,000 aggregate principal amount of its Air Quality Development Revenue
Refunding Bonds (Ohio Power Company Project), Series C, dated as of May 1, 1999
(the "Series C Bonds"). The Series C Bonds bear interest at a rate of 5.15% per
annum and mature by their terms on May 1, 2026. The Series C Bonds were sold by
the Authority to the Underwriter at an initial offering price of 100% of the
principal amount. The Company paid $312,500 to the Underwriter as compensation.
The Series C Bonds were issued by the Authority pursuant to an Indenture of
Trust dated as of November 1, 1979 between the Authority and National City Bank
(successor to BancOhio National Bank), as Trustee, as supplemented by a Second
Supplemental Indenture of Trust, dated as of May 1, 1999 (a copy of which Second
Supplemental Indenture is attached hereto as Exhibit B-5 to the Application or
Declaration).
2. The transaction described above was not subject to the jurisdiction of
any state commission other than, and was carried out in accordance with the
authorization of, The Public Utilities Commission of Ohio. A copy of the Order
of The Public Utilities Commission of Ohio dated April 1, 1999 is attached
hereto as Exhibit D-6.
OHIO POWER COMPANY
By /s/ Thomas G. Berkemeyer__
Assistant Secretary
August 3, 1999
Exhibit B-5
SECOND SUPPLEMENTAL INDENTURE OF TRUST
Between
OHIO AIR QUALITY DEVELOPMENT AUTHORITY
And
NATIONAL CITY BANK
(successor to BancOhio National Bank)
Trustee
Dated as of May 1, 1999
THIS SECOND SUPPLEMENTAL INDENTURE OF TRUST (the "Second Supplemental
Indenture") made and entered into as of May 1, 1999, by and between the OHIO AIR
QUALITY DEVELOPMENT AUTHORITY, a body both corporate and politic in the State of
Ohio, organized and existing under the laws of the State of Ohio (the "Issuer"),
and NATIONAL CITY BANK (successor to BancOhio National Bank), a national banking
association organized, existing and authorized to accept and execute trusts of
the character herein set out under and by virtue of the laws of the United
States, with its principal office located in Cleveland, Ohio, as trustee (the
"Trustee").
R E C I T A L S
WHEREAS, the Issuer has issued $50,000,000 aggregate principal amount of
State of Ohio Air Quality Development Revenue Bonds (Ohio Power Company
Project), Series A (the "Series A Bonds"), pursuant to Section 13 of Article
VIII of the Ohio Constitution, as implemented by Chapter 3706, Ohio Revised
Code, both as amended (collectively, the "Act"), under the Indenture of Trust
dated as of November 1, 1979 (the "Indenture"), between the Issuer and BancOhio
National Bank, as Trustee (the "Original Trustee") for the purpose of acquiring,
constructing and financing, in part, certain facilities of Ohio Power Company
(the "Company") designed for the abatement of atmospheric pollution (the
"Project") at the Company's Unit 1 (the "Cardinal Plant") of the Cardinal
Generating Station located in the County of Jefferson, Ohio, and at the
Company's Muskingum River Generating Station (the "Muskingum River Plant")
located in the Counties of Morgan and Washington, Ohio (the Cardinal Plant and
the Muskingum River Plant being referred to herein collectively as the
"Plants"), which facilities were sold to the Company pursuant to an Agreement of
Sale dated as of November 1, 1979 (the "Agreement") between the Issuer and the
Company; and
WHEREAS, the Issuer has issued $50,000,000 aggregate principal amount of
State of Ohio Air Quality Development Revenue Refunding Bonds (Ohio Power
Company Project), Series B (the "Series B Bonds"), as Refunding Bonds pursuant
to Section 2.11 of the Indenture and a First Supplemental Indenture of Trust
dated as of August 1, 1989 between the Issuer and the Original Trustee (the
"First Supplemental Indenture") to refund $50,000,000 aggregate principal amount
of Series A Bonds on November 1, 1989; and
WHEREAS, the Original Trustee merged with and into National City Bank,
thereby transferring its trust business and assets to the Trustee, and pursuant
to law and the provisions of Section 9.05 of the Indenture, the Trustee
thereupon became successor trustee hereunder and became vested with all of the
title to the trust estate and all the trusts, powers, discretions, immunities,
privileges and all other matters as was the Original Trustee; and
WHEREAS, the Issuer has determined to issue $50,000,000 aggregate
principal amount of State of Ohio Air Quality Development Revenue Refunding
Bonds (Ohio Power Company Project), Series C (the "Series C Bonds"), as
Refunding Bonds pursuant to Section 2.11 of the Indenture to refund $50,000,000
aggregate principal amount of Series B Bonds at their redemption on August 1,
1999; and
WHEREAS, the issuance of the Series C Bonds has been approved by the
Issuer, after public hearings, as required by Section 147(f) of the Internal
Revenue Code of 1986, as amended; and
WHEREAS, that portion of payments of principal of and interest on the
Series C Bonds which shall become Due for Payment but shall be unpaid by reason
of Nonpayment (as each such term is defined in the Policy, as defined below)
have been insured pursuant to a municipal bond insurance policy (the "Policy")
issued by Ambac Assurance Corporation (the "Insurer") and the Policy has been
delivered to United States Trust Company of New York, as Insurance Trustee (the
"Insurance Trustee"); and
WHEREAS, the Issuer has determined that the Series C Bonds issuable
hereunder, and the certificate of authentication by the Trustee to be endorsed
on all such bonds shall be, respectively, substantially in the following forms
with such variations, omissions and insertions as are required or permitted by
the Indenture or this Second Supplemental Indenture:
(FORM OF BOND)
No. RC-1 $
STATE OF OHIO
Air Quality Development Revenue Refunding Bond
(Ohio Power Company Project)
SERIES C
MATURITY DATE: CUSIP:
REGISTERED OWNER:
PRINCIPAL AMOUNT: DOLLARS
The STATE OF OHIO, a state of the United States of America, by the Ohio
Air Quality Development Authority, a body both corporate and politic (the
Issuer), for value received, hereby promises to pay, solely from the source and
as hereinafter provided, to the registered owner stated above, or registered
assigns or legal representatives, upon presentation and surrender hereof at the
principal office of National City Bank (successor to BancOhio National Bank), as
Trustee, or its successor in trust (the Trustee), in Cleveland, Ohio, or, at the
option of the registered owner hereof, at the principal office of such paying
agent as may be designated pursuant to the Indenture hereinafter referred to,
the principal sum stated above on the maturity date stated above, subject to
prior redemption as hereinafter provided, and to pay from such source to the
registered owner hereof interest hereon by check or draft mailed to the
registered owner at his address as it appears on the registration books kept by
the Trustee, as Bond Registrar, such interest payable semiannually on each May 1
and November 1 from the May 1 or November 1 to which interest on the Bonds has
accrued and been paid or duly provided for, as the case may be, next preceding
the date on which this Bond is authenticated, unless this Bond is authenticated
on a May 1 or November 1, in which case it will bear interest from such May 1 or
November 1, as the case may be, or, if no interest on the Bonds has been paid or
duly provided for, from May 1, 1999, until payment of said principal sum at the
rate of five and fifteen one-hundredths per centum (5.15%) per annum. Both
principal and interest are payable in lawful money of the United States of
America. Interest will be computed on the basis of a 360 day year of twelve 30
day months.
THIS BOND AND THE ISSUE OF WHICH IT IS A PART AND THE INTEREST THEREON ARE
SPECIAL OBLIGATIONS OF THE STATE OF OHIO PAYABLE SOLELY FROM THE REVENUES AND
RECEIPTS DERIVED FROM THE AGREEMENT OF SALE HEREINAFTER REFERRED TO (EXCEPT TO
THE EXTENT PAID OUT OF MONEY ATTRIBUTABLE TO BOND PROCEEDS AND INCOME FROM
TEMPORARY INVESTMENTS), WHICH REVENUES AND RECEIPTS (EXCEPT FOR PAYMENTS OF
ISSUER EXPENSES UNDER SECTION 4.3 OF THE AGREEMENT OF SALE AND PAYMENTS FOR
INDEMNIFICATION UNDER SECTIONS 4.5 AND 6.1 OF THE AGREEMENT OF SALE) HAVE BEEN
PLEDGED AND ASSIGNED TO THE TRUSTEE TO SECURE PAYMENT THEREOF. THE BONDS AND THE
INTEREST THEREON DO NOT CONSTITUTE A DEBT, OR A PLEDGE OF THE FAITH AND CREDIT,
OF THE ISSUER OR THE STATE OF OHIO OR ANY POLITICAL SUBDIVISION THEREOF,
INCLUDING THE ISSUER. THE OWNERS OF THE BONDS HAVE NO RIGHT TO HAVE TAXES LEVIED
BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO OR TAXING AUTHORITY OF ANY
POLITICAL SUBDIVISION OF THE STATE OF OHIO FOR THE PAYMENT OF THE PRINCIPAL
THEREOF OR INTEREST OR PREMIUM THEREON, BUT THE BONDS ARE PAYABLE SOLELY FROM
THE REVENUES AND RECEIPTS PLEDGED THEREFOR. THE ISSUER HAS NO TAXING POWER.
This Bond is one of an issue of $50,000,000 aggregate principal amount of
State of Ohio Air Quality Development Revenue Refunding Bonds (Ohio Power
Company Project), Series C (the Bonds), of like date and tenor, except as to
number and principal amount, authorized and issued pursuant to Section 13 of
Article VIII of the Ohio Constitution, as implemented by Chapter 3706, Ohio
Revised Code, both as amended, for the purpose of refunding certain State of
Ohio Air Quality Development Revenue Refunding Bonds (Ohio Power Company
Project), Series B, which were previously issued by the Issuer for the purpose
of refinancing, in part, certain air pollution control facilities (the Project)
located at Unit 1 of Ohio Power Company, an Ohio corporation (the Company), at
the Cardinal Generating Station within the County of Jefferson, Ohio and at the
Company's Muskingum River Generating Station within the Counties of Morgan and
Washington, Ohio (Unit 1 of the Cardinal Generating Station and the Muskingum
River Generating Station being referred to herein collectively as the Plants),
and selling the same to the Company pursuant to an Agreement of Sale dated as of
November 1, 1979, as amended (the Agreement of Sale), between the Issuer and the
Company. The Bonds are issued under and, together with other series of bonds,
are equally and ratably secured by an Indenture of Trust dated as of November 1,
1979, as supplemented and amended, and as further supplemented by a Second
Supplemental Indenture dated as of May 1, 1999 (the Indenture of Trust as
supplemented and amended being referred to herein as the Indenture), between the
Issuer and the Trustee, which assigns to the Trustee, as security for the Bonds,
the Issuer's rights under the Agreement of Sale (except for payment of Issuer
expenses and for indemnification of the Issuer). Reference is hereby made to the
Indenture, the Agreement of Sale and to all amendments and supplements thereto
for a description of the provisions, among others, with respect to the nature
and extent of the security, the rights, duties and obligations of the Issuer and
the Trustee and the rights of the owners of the Bonds and the terms upon which
the Bonds are issued and secured. Additional bonds and refunding bonds ranking
equally with the Bonds and other bonds issued under the Indenture may be issued
on the terms provided in the Indenture.
The Bonds are subject to redemption by the Issuer in whole, but not in
part, at any time upon payment of 100% of the principal amount thereof, plus
interest accrued to the redemption date, in the event of the exercise by the
Company of its option to prepay the entire purchase price of the Project under
circumstances involving (i) the imposition of unreasonable burdens or excessive
liabilities on the Issuer or the Company with respect to the Project or either
of the Plants, including taxes not imposed on November 1, 1979 and economic,
technological or other changes making the continued operation of either or both
of the Plants uneconomical in the opinion of the Company's Board of Directors;
(ii) the Agreement of Sale becoming void, unenforceable or impossible of
performance in accordance with the intent and purpose of the parties as
expressed therein by reason of any changes in the Constitution of the State of
Ohio or the Constitution of the United States of America or by reason of any
legislative or administrative action (whether state or Federal) or any final
determination of any court or administrative body (whether state or Federal)
entered after the contest thereof by the Issuer or the Company in good faith;
(iii) damage to or destruction of the Project or a portion thereof or all or a
portion of either or both of the Plants to such an extent that the Company deems
it not practicable and desirable to rebuild, repair and restore the Project, a
Plant or the Plants, as the case may be; (iv) condemnation of all or
substantially all of the Project or all or a portion of either or both of the
Plants so as to render the Project unsatisfactory to the Company for its
intended use; or (v) the operation of either of the Plants being enjoined and
the Company decides to discontinue operation thereof, all as provided in Section
8.1(b) of the Agreement of Sale.
The Bonds are also subject to optional redemption by the Issuer, at the
request of the Company, prior to maturity on or after May 1, 2009, at any time
in whole or in part (if less than all of the Bonds are to be redeemed, the Bonds
to be redeemed to be selected by the Depository Trust Company or any successor
securities depository pursuant to its rules and procedures or, if the book-entry
system is discontinued, by lot by the Trustee) upon payment of the following
redemption prices (expressed as a percentage of principal amount of Bonds to be
redeemed) plus accrued interest to the redemption date:
Redemption
Redemption Dates (Dates Inclusive) Price May 1, 2009 to April 30, 2010 101.00%
May 1, 2010 to April 30, 2011 100.50% May 1, 2011 and thereafter 100.00%
If less than all of the Bonds are called for redemption, each $5,000
principal amount of a Bond having a principal amount of more than $5,000 shall
be counted as one bond for the purpose of selecting by lot.
If any of the Bonds or portions thereof are called for redemption, the
Trustee shall cause a notice thereof to be sent by registered or certified mail
to the registered owner of the Bonds not less than 30 nor more than 60 days
prior to the redemption date. Provided funds for their redemption are on deposit
at the place of payment on the redemption date, all Bonds or portions thereof so
called for redemption shall cease to bear interest on the redemption date, shall
no longer be secured by the Indenture and shall not be deemed to be outstanding
under the provisions of the Indenture. If a portion of this Bond shall be called
for redemption, a new Bond in principal amount equal to the unredeemed portion
hereof will be issued to the registered owner upon the surrender hereof.
The owner of this Bond shall have no right to enforce the provisions of
the Indenture or to institute action to enforce the covenants therein or to take
any action with respect to any Event of Default under the Indenture or to
institute, appear in or defend any suit or other proceeding with respect
thereto, except as provided in the Indenture. In certain events, on conditions,
in the manner and with the effect set forth in the Indenture, the principal of
all the Bonds issued under the Indenture and then outstanding may become or may
be declared due and payable before their stated maturities, together with
interest accrued thereon. Modifications or alterations of the Indenture, or of
any supplements thereto, may be made only to the extent and in the circumstances
permitted by the Indenture.
The Bonds are issuable as registered bonds without coupons in the
denominations of $5,000 or any integral multiple thereof.
The transfer of this Bond may be registered by the registered owner hereof
in person or by his duly authorized attorney or legal representative at the
principal office of the Bond Registrar, but only in the manner and subject to
the limitations and conditions provided in the Indenture and upon surrender and
cancellation of this Bond. Upon any such registration of transfer, the Issuer
shall execute and the Trustee shall authenticate and deliver in exchange for
this Bond a new Bond or Bonds, registered in the name of the transferee, of
authorized denominations. The Bond Registrar shall, prior to the due presentment
for registration of transfer, treat the registered owner as the person
exclusively entitled to payment of principal and interest and the exercise of
all other rights and powers of the owner.
All acts, conditions and things required to happen, exist or be performed
precedent to the issuance of this Bond have happened, exist and have been
performed.
This Bond shall not become obligatory for any purpose or be entitled to
any security or benefit under the Indenture or be valid until the Trustee shall
have executed the Certificate of Authentication appearing hereon.
IN WITNESS WHEREOF, the STATE OF OHIO, by the Ohio Air Quality Development
Authority, has caused this Bond to be signed by the manual or facsimile
signatures of said Authority's Chairman and Vice-Chairman, said Authority's
official seal to be affixed hereto or a facsimile thereof to be printed hereon
and attested by the manual or facsimile signature of said Authority's
Secretary-Treasurer, and this Bond to be dated as of May 1, 1999.
STATE OF OHIO, by the
Ohio Air Quality Development
Authority
(Seal)
By_________________________
Chairman
Attest:
By_________________________
Vice-Chairman
By____________________
Secretary-Treasurer
(FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION)
This Bond is one of the Bonds of the Series described in the
within-mentioned Indenture.
NATIONAL CITY BANK, as Trustee
By__________________________
Authorized Officer
Date:
Municipal Bond Insurance Policy No. _______ (the "Policy") with respect to
payments due for the principal of and interest on the Bonds has been issued by
Ambac Assurance Corporation (the "Insurer"). The Policy has been delivered to
United States Trust Company of New York, as the Insurance Trustee under the
Policy and will be held by such Insurance Trustee or any successor insurance
trustee. The Policy is on file and available for inspection at the principal
office of the Insurance Trustee and a copy thereof may be secured from the
Insurer or the Insurance Trustee. All payments required to be made under the
Policy shall be made in accordance with the provisions thereof. The owner of the
Bonds acknowledges and consents to the subrogation rights of the Insurer as more
fully set forth in the Policy. Any provision of the Indenture expressly
recognizing or granting rights in or to the Insurer may not be amended in any
manner which affects the rights of the Insurer thereunder without the prior
consent of the Insurer.
(FORM OF ASSIGNMENT)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto ______________________________ (Please insert Social Security or other
taxpayer identification number of assignee)
_______________________________________ (Please print or typewrite Name and
Address of Assignee) __________________________ the within Bond, and all rights
thereunder, and hereby does irrevocably constitute and appoint
________________________ Attorney to transfer the within Bond on the books kept
for the registration thereof, with full power of substitution in the premises.
Dated:
-----------------------------------
NOTICE: The signature to this assignment
must correspond with the name as it appears
on the face of the within Bond in every
particular, without alteration or
enlargement or any change whatever.
Signature Guaranteed: ______________________________; and
NOTICE: Signature(s) must be guaranteed by
an Eligible Guarantor Institution such as a
Commercial Bank, Trust Company, Securities
Broker/Dealer, Credit Union, or Savings
Association who is a member of a medallion
program approved by The Securities Transfer
Association, Inc.
WHEREAS, all things necessary have been done and performed to make the
Series C Bonds, when issued and authenticated by the Trustee, valid, binding and
legal special obligations of the Issuer and to constitute this Second
Supplemental Indenture a valid and binding agreement securing the payment of the
principal of, premium, if any, and interest on all bonds issued and to be issued
hereunder and under the Indenture (the Indenture, as supplemented by the First
Supplemental Indenture and this Second Supplemental Indenture being referred to
herein as the Indenture) and the execution and delivery of this Second
Supplemental Indenture and the execution and issuance of the Series C Bonds have
in all respects been authorized;
NOW, THEREFORE, the Issuer hereby agrees and covenants with the Trustee
and with the respective holders and owners, from time to time of the Series B
Bonds and Series C Bonds or coupons thereon, or any part thereof, as follows:
ARTICLE I
Purpose of Series C Bonds
Section 1.01. Purpose of Series C Bonds. The Series C Bonds of the Issuer
are authorized for the purpose of refunding $50,000,000 aggregate principal
amount of Series B Bonds at their redemption on August 1, 1999.
ARTICLE II
The Series C Bonds
Section 2.01. Issuance of Series C Bonds. There are hereby authorized to
be issued State of Ohio Air Quality Development Revenue Refunding Bonds of the
Issuer in the aggregate principal amount of fifty million dollars ($50,000,000)
as Refunding Bonds pursuant to Section 2.11 of the Indenture. Said Bonds shall
be designated "State of Ohio Air Quality Development Revenue Refunding Bonds
(Ohio Power Company Project), Series C," shall be dated the first day of May,
1999, shall bear interest payable semiannually on the first day of May and
November in each year at the rate of five and fifteen one-hundredths per centum
(5.15%) per annum and shall mature, subject to the right of prior redemption as
hereinafter set forth, on May 1, 2026.
Both principal of and interest on the Series C Bonds shall be payable in
lawful money of the United States of America, but only from the revenues and
receipts pledged to the payment thereof as provided herein and in the Indenture.
Section 2.02. Form of Series C Bonds. The Series C Bonds shall be issued
substantially in the form of the Series C Bond hereinabove set forth, with such
appropriate variations, omissions and insertions as are permitted or required by
the Indenture or this Second Supplemental Indenture.
Initially, one certificate for the Series C Bonds will be issued and
registered to the Securities Depository (as defined below), or its nominee. The
Issuer may enter into a Letter of Representations (as defined below) relating to
a book-entry system to be maintained by the Securities Depository with respect
to the Series C Bonds.
In the event that (a) the Securities Depository determines not to continue
to act as a securities depository for the Series C Bonds by giving notice to the
Trustee and the Issuer discharging its responsibilities hereunder, or (b) the
Issuer determines (at the direction of the Company) (i) that beneficial owners
of Series C Bonds shall be able to obtain certificated Series C Bonds or (ii) to
select a new Securities Depository, then the Trustee shall, at the direction of
the Issuer (at the request of the Company), attempt to locate another qualified
securities depository to serve as Securities Depository or authenticate and
deliver certificated Series C Bonds to the beneficial owners or to the
Securities Depository participants on behalf of beneficial owners substantially
in the form provided for in this Section. In delivering certificated Series C
Bonds, the Trustee shall be entitled to rely on the records of the Securities
Depository as to the beneficial owners or the records of the Securities
Depository participants acting on behalf of beneficial owners. Such certificated
Series C Bonds will then be registrable, transferable and exchangeable as set
forth in this Indenture.
So long as there is a Securities Depository for the Series C Bonds (1) it
or its nominee shall be the registered owner of the Series C Bonds; (2)
notwithstanding anything to the contrary in this Indenture, determinations of
persons entitled to payment of principal, premium, if any, and interest,
transfers of ownership and exchanges and receipt of notices shall be the
responsibility of the Securities Depository and shall be effected pursuant to
rules and procedures established by such Securities Depository; (3) the Issuer,
the Company and the Trustee shall not be responsible or liable for maintaining,
supervising or reviewing the records maintained by the Securities Depository,
its participants or persons acting through such participants; (4) except to the
extent the Insurer is deemed to be the holder of the Series C Bonds, as provided
in Article V hereof, references in this Indenture to registered owners of the
Series C Bonds shall mean such Securities Depository or its nominee and shall
not mean the beneficial owners of the Series C Bonds; and (5) in the event of
any inconsistency between the provisions of this Indenture and the provisions of
the Letter of Representations such provisions of the Letter of Representations,
except to the extent set forth in this paragraph and the next preceding
paragraph, shall control.
For purposes of this Section, the following terms shall have the following
meanings:
"Letter of Representations" means the Letter of Representations dated
April 21, 1999, from the Issuer to the Securities Depository and (with the
consent of the Company) any amendments thereto, or successor agreements between
the Issuer and any successor Securities Depository, relating to a book-entry
system to be maintained by the Securities Depository with respect to the Series
C Bonds.
"Securities Depository" means The Depository Trust Company, a corporation
organized and existing under the laws of the State of New York, and any other
securities depository for the Series C Bonds appointed pursuant to this Section,
and their successors.
Section 2.03. Execution, Authentication and Delivery of Series C Bonds.
The Series C Bonds shall be executed, authenticated and delivered, and the
proceeds therefrom deposited, as provided in Section 2.11 of the Indenture and
Section 3.2(c) of the Agreement. A copy of the Policy, as defined herein, shall
be delivered to the Trustee.
ARTICLE III
Redemption of Series C Bonds Before Maturity
Section 3.01. Redemption. The Series C Bonds are subject to redemption in
whole, but not in part, at any time upon payment of 100% of the principal amount
thereof, plus interest accrued to the redemption date by the Issuer in the event
that the Company shall exercise its option to prepay, and shall prepay, the
purchase price of the Project under circumstances involving (i) the imposition
of unreasonable burdens or excessive liabilities on the Issuer or the Company
with respect to the Project or either of the Plants, including taxes not imposed
on November 1, 1979 and economic, technological or other changes making the
continued operation of either or both of the Plants uneconomical in the opinion
of the Company's Board of Directors; (ii) the Agreement becoming void,
unenforceable or impossible of performance in accordance with the intent and
purpose of the parties as expressed therein by reason of any changes in the
Constitution of the State of Ohio or the Constitution of the United States of
America or by reason of any legislative or administrative action (whether state
or Federal) or any final determination of any court or administrative body
(whether state or Federal) entered after the contest thereof by the Issuer or
the Company in good faith; (iii) damage to or destruction of the Project or a
portion thereof or all or a portion of either or both of the Plants to such an
extent that the Company deems it not practicable and desirable to rebuild,
repair and restore the Project, a Plant or the Plants, as the case may be; (iv)
condemnation of all or substantially all of the Project or all or a portion of
either or both of the Plants so as to render the Project unsatisfactory to the
Company for its intended use; or (v) the operation of either of the Plants being
enjoined and the Company decides to discontinue the operation thereof, all as
provided in Section 8.1(b) of the Agreement.
The Series C Bonds are also subject to optional redemption by the Issuer,
at the request of the Company, prior to maturity on or after May 1, 2009, at any
time in whole or in part (if less than all the Series C Bonds are to be
redeemed, the Series C Bonds to be redeemed to be selected by the Depository
Trust Company or any successor securities depository pursuant to its rules and
procedures or, if the book-entry system is discontinued, by lot by the Trustee)
upon payment of the following redemption prices (expressed as a percentage of
principal amount of Series C Bonds to be redeemed) plus accrued interest to the
redemption date:
Redemption
Redemption Dates (Dates Inclusive) Price
May 1, 2009 to April 30, 2010 101.00%
May 1, 2010 to April 30, 2011 100.50%
May 1, 2011 and thereafter 100.00%
If less than all of the Series C Bonds are called for redemption, each
$5,000 of a Series C Bond having a principal amount of more than $5,000 shall be
counted as one Series C Bond for the purpose of selecting by lot. If a portion
of a Series C Bond having a principal amount of more than $5,000 shall be called
for redemption, a new Series C Bond in principal amount equal to the unredeemed
portion thereof shall be issued to the registered owner upon the surrender
thereof.
Section 3.02. Other Provisions Pertaining to Redemption. Reference is
hereby made to Article III of the Indenture for the provisions describing the
methods and effects of redemption.
ARTICLE IV
Covenants and Security
Section 4.01. Authority; Compliance with Conditions. The Issuer covenants
that it is duly authorized under the laws of the State of Ohio, including
particularly and without limitation the Act, to issue the Series C Bonds
authorized hereby and to execute and deliver this Second Supplemental Indenture,
to assign and pledge the Agreement and the revenues and receipts payable under
the Agreement, to grant a security interest therein and to pledge the revenues
and receipts hereby pledged and in the manner and to the extent contemplated
herein and in the Indenture; that all of the requirements and conditions for the
issuance of the Series C Bonds and the execution and delivery of this Second
Supplemental Indenture have been satisfied and complied with; that all other
action on its part necessary for the issuance of the Series C Bonds and the
execution and delivery of this Second Supplemental Indenture has been duly and
effectively taken; and that the Series C Bonds in the hands of the owners
thereof are and will be valid and enforceable special obligations of the Issuer
according to the terms thereof and hereof.
Section 4.02. Security for Series C Bonds; Confirmation of Indenture. The
Series C Bonds shall be equally and ratably (except insofar as any guaranty,
letters of credit, insurance policy, first mortgage bond or other collateral or
instrument of credit enhancement provided by a person other than the Issuer may
afford additional security from the Bonds of any particular series) secured
under the Indenture with all outstanding Bonds, and any other series of Bonds
which may be issued pursuant to Section 2.10 or 2.11 of the Indenture, without
preference, priority or distinction of any Bonds, as defined therein, over any
other Bonds. As supplemented and amended, the Indenture is in all respects
ratified and confirmed, and the Indenture, including each supplemental
indenture, shall be read, taken and construed as one and the same instrument.
All covenants, agreements and provisions of, and all security provided under,
the Indenture shall apply with full force and effect to the Series C Bonds and
to the owners thereof.
ARTICLE V
Special Insurance Provisions
Section 5.01. Concerning the Special Insurance Provisions. The provisions
of this Article V shall apply notwithstanding anything in the Indenture to the
contrary, but only so long as (i) the Policy remains in full force and effect,
(ii) the Insurer is not in default in its obligations under the Policy, and
(iii) the Series C Bonds remain outstanding (as defined in the Indenture and
Section 5.08 hereof).
Section 5.02. Consent of the Insurer in Addition to Bondholder Consent.
Unless otherwise provided in this Section, the Insurer's written consent shall
be required (in addition to bondholder consent, when required) for the following
purposes: (i) execution and delivery of any supplemental indenture or any
amendment, supplement or change to or modification of the Agreement of Sale;
(ii) removal of the Trustee or Paying Agent and selection and appointment of any
successor trustee or paying agent; and (iii) initiation or approval of any
action not described in (i) or (ii) above which requires bondholder consent.
Section 5.03. Insurer's Consent Upon Default. Anything in the Indenture to
the contrary notwithstanding, upon the occurrence and continuance of an Event of
Default under the Indenture, the Insurer shall be entitled to control and direct
the enforcement of all rights and remedies granted to the bondholders or the
Trustee for the benefit of the bondholders under the Indenture, including,
without limitation, (i) the right to accelerate the principal of the Series C
Bonds as described in the Indenture and (ii) the right to annul any declaration
of acceleration, and the Insurer shall also be entitled to approve all waivers
of events of default.
Section 5.04. Acceleration Rights. Upon the occurrence of an Event of
Default, the Trustee may, with the consent of the Insurer, and shall, at the
direction of the Insurer or 25% of the bondholders with the consent of the
Insurer, by written notice to the Issuer and the Insurer, declare the principal
of the Series C Bonds to be immediately due and payable, whereupon that portion
of the principal of the Series C Bonds thereby coming due and the interest
thereon accrued to the date of payment shall, without further action, become and
be immediately due and payable, anything in the Indenture or in the Series C
Bonds to the contrary notwithstanding.
Section 5.05. Amendments. Any provision of the Indenture expressly
recognizing or granting rights in or to the Insurer may not be amended in any
manner which affects the rights of the Insurer hereunder without the prior
written consent of the Insurer.
Section 5.06. Notices and Information.
(a) The Trustee shall furnish to the Insurer a copy of any notice to be
given to the registered owners of the Series C Bonds, including, without
limitation, notice of any redemption of or defeasance of the Series C Bonds, and
any certificate rendered pursuant to the Indenture relating to the security for
the Series C Bonds.
(b) The Trustee or the Issuer shall notify the Insurer of any failure of
the Company to provide relevant notices, certificates, etc.
(c) Notwithstanding any other provision of the Indenture, the Trustee
shall immediately notify the Insurer if at any time there are insufficient
moneys to make any payments of principal and/or interest as required and
immediately upon the occurrence of any Event of Default under the Indenture.
(d) All notice or other communication to be given to the Insurer under
this Second Supplemental Indenture or the Indenture may be given by mailing or
delivering the same in writing to Ambac Assurance Corporation, One State Street
Plaza, New York, New York 10004, Attention:, in the case of subclause (a) above,
The Surveillance Department, and in all other cases, The General Counsel's
Office.
Section 5.07. Payment Procedures; Subrogation. The Issuer, the
Trustee and any Paying Agent agree to comply with the following provisions:
(a) If the Trustee or Paying Agent, if any, determines that there will be
insufficient funds to pay the principal of or interest on the Series C Bonds at
maturity or on any Interest Payment Date, as the case may be, the Trustee or
Paying Agent, if any, shall so notify the Insurer within one business day after
such determination. Such notice shall specify the amount of the anticipated
deficiency, the Series C Bonds to which such deficiency is applicable and
whether such Series C Bonds will be deficient as to principal or interest, or
both. The Insurer will make payments of principal of or interest due on the
Series C Bonds on or before the first business day next following the date on
which the Insurer shall have received notice of nonpayment from the Trustee or
Paying Agent, if any.
(b) The Trustee or Paying Agent, if any, shall, after giving notice to the
Insurer as provided in (a) above, make available to the Insurer and, at the
Insurer's direction, to the Insurance Trustee, the registration books of the
Issuer maintained by the Trustee or Paying Agent, if any, and all records
relating to the Series C Bonds maintained under the Indenture.
(c) The Trustee or Paying Agent, if any, shall provide the Insurer and the
Insurance Trustee with a list of registered owners of Series C Bonds entitled to
receive principal or interest payments from the Insurer under the terms of the
Policy, and shall make arrangements with the Insurance Trustee (i) to mail
checks to or pay by wire transfer the registered owners of the Series C Bonds
entitled to receive full or partial interest payments from the Insurer and (ii)
to pay principal upon Series C Bonds surrendered to the Insurance Trustee by the
registered owners of Series C Bonds entitled to receive full or partial
principal payments from the Insurer.
(d) The Trustee or Paying Agent, if any, shall, at the time it provides
notice to the Insurer pursuant to (a) above, notify registered owners of the
Series C Bonds entitled to receive the payment of principal or interest thereon
from the Insurer (i) as to the fact of such entitlement, (ii) that the Insurer
will remit to them all or a part of the interest payments next coming due upon
proof of a Series C Bond owner's entitlement to interest payments and delivery
to the Insurance Trustee, in form satisfactory to the Insurance Trustee, of an
appropriate assignment of the registered owner's right to payment, (iii) that
should they be entitled to receive full payment of principal from the Insurer,
they must surrender their Series C Bonds (along with an appropriate instrument
of assignment in form satisfactory to the Insurance Trustee to permit ownership
of such Series C Bonds to be registered in the name of the Insurer) for payment
to the Insurance Trustee, and not the Trustee or Paying Agent, if any, and (iv)
that should they be entitled to receive partial payment of principal from the
Insurer, they must surrender their Series C Bonds for payment thereon first to
the Trustee or Paying Agent, if any, who shall note on such Series C Bonds the
portion of the principal paid by the Trustee or Paying Agent, if any, and then,
along with an appropriate instrument of assignment in form satisfactory to the
Insurance Trustee, to the Insurance Trustee, which will then pay the unpaid
portion of principal.
(e) In the event that the Trustee or Paying Agent, if any, has notice that
any payment of principal of or interest on the Series C Bonds which has become
Due for Payment (as defined in the Policy) and which is made to an owner of a
Series C Bond by or on behalf of the Issuer has been deemed a preferential
transfer and theretofore recovered from its registered owner pursuant to the
United States Bankruptcy Code by a trustee in bankruptcy in accordance with the
final, nonappealable order of a court having competent jurisdiction, the Trustee
or Paying Agent, if any, shall, at the time the Insurer is notified pursuant to
(a) above, notify all registered owners that in the event that any registered
owner's payment is so recovered, such registered owner will be entitled to
payment from the Insurer to the extent of such recovery if sufficient funds are
not otherwise available, and the Trustee or Paying Agent, if any, shall furnish
to the Insurer its records evidencing the payments of principal of and interest
on the Series C Bonds which have been made by the Trustee or Paying Agent, if
any, and subsequently recovered from registered owners and the dates on which
such payments were made.
(f) In addition to those rights granted the Insurer under the Indenture,
the Insurer shall, to the extent it makes payment of principal of or interest on
the Series C Bonds, become subrogated to the rights of the recipients of such
payments in accordance with the terms of the Policy, and to evidence such
subrogation (i) in the case of subrogation as to claims for past due interest,
the Trustee or Paying Agent, if any, shall note the Insurer's rights as subrogee
on the registration books of the Issuer maintained by the Trustee or Paying
Agent, if any, upon receipt from the Insurer of proof of the payment of interest
thereon to the registered owners of the Series C Bonds, and (ii) in the case of
subrogation as to claims for past due principal, the Trustee or Paying Agent, if
any, shall note the Insurer's rights as subrogee on the registration books of
the Issuer maintained by the Trustee or Paying Agent, if any, upon surrender of
the Series C Bonds by the registered owners thereof together with proof of the
payment of principal thereof.
Section 5.08. Bonds Outstanding on Payment by Insurer. Notwithstanding
anything in the Indenture to the contrary, in the event that the principal of
and/or interest due on the Series C Bonds shall be paid by the Insurer pursuant
to the Policy, the Series C Bonds shall remain "outstanding" for all purposes
under the Indenture, not be defeased or otherwise satisfied and not be
considered paid by the Issuer, and the assignment and pledge of the trust estate
and all covenants, agreements and other obligations of the Issuer to the
registered owners of the Series C Bonds shall continue to exist and shall run to
the benefit of the Insurer, and the Insurer shall be subrogated to the rights of
such registered owners of the Series C Bonds.
Section 5.09. Insurer's Rights Concerning the Trustee.
(a) The Trustee or Paying Agent may be removed at any time, at the written
request of the Insurer, for any breach by the Trustee or Paying Agent, as the
case may be, of any of the provisions set forth herein or in the Indenture.
(b) The Insurer shall receive prior written notice of any Trustee or
Paying Agent resignation.
(c) Notwithstanding any other provision of the Indenture, in determining
whether the rights of the bondholders will be adversely affected in any material
respect by any action taken pursuant to the terms and provisions of the
Indenture, the Trustee or Paying Agent shall consider the effect on the
bondholders as if there were no Policy. The Trustee shall not consider any
payments made under the Policy in determining whether a default under Section
8.01(a) or (b) of the Indenture shall have occurred.
(d) The Trustee shall be deemed to waive notice of any default under the
Indenture of which it shall be specifically advised in writing by the Insurer.
(e) Notwithstanding any other provision of the Indenture, no removal,
resignation or termination of the Trustee or Paying Agent shall take effect
until a successor, reasonably acceptable to the Insurer, shall be appointed.
Section 5.10. Insurer's Right to Information. The Issuer will permit the
Insurer to discuss the affairs, finances and accounts of the Issuer or any
information the Insurer may reasonably request regarding the security for the
Series C Bonds with appropriate officers of the Issuer. The Trustee or Issuer,
as appropriate, will permit the Insurer to have access to and to make copies of
all books and records relating to the Series C Bonds at any reasonable time.
Section 5.11. Intervention. Intervention by the Trustee in any judicial
proceeding pursuant to Section 9.04 of the Indenture shall be made in accordance
therewith on the request of the Insurer and any intervention based on the
request of the bondholders as provided therein may only be made with the prior
written consent of the Insurer.
Section 5.12. Insurer as Third Party Beneficiary. To the extent that the
Indenture confers upon or gives or grants to the Insurer any right, remedy or
claim, the Insurer is hereby explicitly recognized as being a third-party
beneficiary hereunder and may enforce any such right, remedy or claim conferred,
given or granted thereunder.
Section 5.13. Parties in Interest. Nothing in the Indenture expressed or
implied is intended or shall be construed to confer upon, or to give or grant
to, any person or entity, other than the Issuer, the Trustee, the Insurer, the
Paying Agent, if any, and the registered owners of the Series C Bonds, any
right, remedy or claim under or by reason of the Indenture or any covenant,
condition or stipulation thereof, and all covenants, stipulations, promises and
agreements in the Indenture by and on behalf of the Issuer shall be for the sole
and exclusive benefit of the Issuer, the Trustee, the Insurer, the Paying Agent,
if any, and the registered owners of the Series C Bonds.
ARTICLE VI
Miscellaneous
Section 6.01. Authority of Officers and Agents. The officers and agents of
the Issuer and the Trustee shall do all acts and things required of them by this
Second Supplemental Indenture, the Indenture and the Series C Bonds for the
complete and punctual performance of all covenants and agreements contained
herein and therein.
Section 6.02. Successors and Assigns. This Second Supplemental Indenture
shall be binding upon, inure to the benefit of and be enforceable by the parties
and their respective successors and assigns.
Section 6.03. Applicable Law. This Second Supplemental Indenture shall
be governed by and construed in accordance with the applicable laws of the
State of Ohio.
Section 6.04. Counterparts. This Second Supplemental Indenture may be
executed in several counterparts, each of which shall be an original, and all
of which together shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the OHIO AIR QUALITY DEVELOPMENT AUTHORITY and
NATIONAL CITY BANK have caused this Second Supplemental Indenture to be executed
in their respective corporate names, all as of the date first above written.
OHIO AIR QUALITY DEVELOPMENT AUTHORITY
By_/s/ Mark R. Shanahan_______
Executive Director
NATIONAL CITY BANK
By_/s/ Sandra R. Johnson_____
Authorized Officer
Exhibit D-6
Before
THE PUBLIC UTILITIES COMMISSION OF OHIO
....................................
:
In the Matter of :
the application of :
OHIO POWER COMPANY : Case No. 99-176-EL-AIS
for consent and authority :
to issue and sell :
pollution control revenue :
refunding bonds :
....................................
FINDING AND ORDER
The Commission finds:
(1) Applicant, Ohio Power Company, is an Ohio Corporation and a public utility
as defined in Section 4905.02, and 4905.03(A)(6), Revised Code, and is
subject to the jurisdiction of this Commission.
(2) This Application is filed under the provisions of Sections 4905.40 and
4905.41, Revised Code.
(3) Applicant proposes to issue additional air quality development revenue
refunding bonds in an aggregate principal amount of up to $50 million (the
"Series C Bonds") through the Ohio Air Quality Development Authority ("the
Authority"), pursuant to an Installment Sale Agreement (the "Agreement")
entered into between Applicant and the Authority, within the terms and
conditions as set forth in the Application and Exhibits.
(4) The proceeds to Applicant from the issuance and sale of the Series C Bonds
will be used to redeem the outstanding Series B Bonds previously issued on
its behalf by the Authority, all pursuant to Section 4905.40, Revised
Code.
(5) The Series C Bonds will have a maturity of not more than 40 years and the
applicable interest rate may be a fixed rate until maturity or may be
adjusted from time to time after the initial interest rate is set, as
described in the Application.
(6) The Agreement between the Applicant and the Authority provides for the
payment to the Authority of the amount sufficient to repay the principal
and interest on the Series C Bonds as the principal and interest become
due, along with the fees and expenses of the Authority, as well as certain
administrative expenses of the Authority.
(7) The proposed guidelines or parameters set forth in the Application and
Exhibits are intended to facilitate the issuance of the Series C Bonds on
the best terms possible and at the lowest cost. The authorization to
consummate the transactions based on the parameters in no way relieves the
Applicant of its obligation to negotiate and obtain the best terms
available.
(8) Applicant is requesting authorization to issue the Series C Bonds without
specifying any time limit. The Staff recommends that the authorization be
limited to a time period of 12 months ending March 31, 2000, for the
following reasons: (1) uncertainty of interest rates beyond a 12-month
period, and (2) difficulty in predicting financial market conditions over
a longer time period. The Commission finds that the Staff recommendation
is reasonable and should be adopted.
(9) The maximum amount of the Series C Bonds, the probable cost to Applicant,
and terms thereof, which are to be no less favorable than the terms set
forth in the Application and eEhibits, do not appear to be unjust or
unreasonable.
(10) The effect of the issuance of the Bonds on Applicant's revenue
requirements will be considered in the determination of required revenues
in rate proceedings in which all factors affecting rates are taken into
account according to law.
(11) Based on information contained in the Application and Exhibits thereto,
and other documentary information to which the Commission has access,
Applicant's proposal to issue the Series C Bonds through the Authority
appears to be reasonably required by the Applicant to meet its present and
prospective obligations to provide utility service, and the Commission is
satisfied that consent and authority should be granted.
It is, therefore,
ORDERED, That Applicant is hereby authorized to issue, through March 31,
2000, additional air quality development revenue refunding bonds in an aggregate
principal amount of up to $50 million through the Ohio Air Quality Development
Authority, pursuant to the terms and conditions as set forth in the Application
and Exhibits. It is, further,
ORDERED, That Applicant shall apply the proceeds from the Series C Bonds
for the purposes set forth in this and otherwise pursuant to the provisions of
Section 4905.40, Revised Code. It is, further,
ORDERED, That the Applicant shall account for the Series C Bonds as
prescribed in the Federal Energy Regulatory Commission Uniform System of
Accounts as currently in effect. It is, further,
ORDERED, That nothing in this Order shall be construed to imply any
guaranty or obligation as to the Series C Bonds or the intrest thereon, on the
part of the State of Ohio. It is, further,
ORDERED, That nothing in this Order shall be construed to imply any
guaranty or obligation by the Commission to assure completion of any specific
construction project of the Applicant. It is, further,
ORDERED, That nothing in this Order shall be deemed to be binding upon
this Commission in any future proceeding or investigation involving the justness
or reasonableness of any rate, charge, rule or regulation. It is, further,
ORDERED, That a copy of this Order be served upon all parties of record.
THE PUBLIC UTILITIES COMMISSION OF OHIO
______/s/ Craig A. Glazer, Chairman_____
Craig A. Grazer, Chairman
__________________________ __/s/ Ronda Hartman Fergus__
Jolynn Barry Butler Ronda Hartman Fergus
__/s/ Judith A. Jones_____ __/s/ Donald L. Mason_______
Judith A. Jones Donald L. Mason
HB:sm
Entered in the Journal
APRIL 01, 1999
A True Copy
_/s/ Gary E. Vigorito_
Gary E. Vigorito
Secretary
