File No. 70-8527
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 4
TO FORM U-1
APPLICATION OR DECLARATION
under the
PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
* * *
OHIO VALLEY ELECTRIC CORPORATION
3932 U.S. Route 23, P.O. Box 468, Piketon, Ohio 45661
(Name of company filing this statement and
addresses of principal executive offices)
* * *
AMERICAN ELECTRIC POWER COMPANY, INC.
1 Riverside Plaza, Columbus, Ohio 43215
(Name of top registered holding company
parent of each applicant or declarant)
* * *
A. A. Pena, Senior Vice President
AMERICAN ELECTRIC POWER SERVICE CORPORATION
1 Riverside Plaza, Columbus, Ohio 43215
Susan Tomasky, General Counsel
AMERICAN ELECTRIC POWER SERVICE CORPORATION
1 Riverside Plaza, Columbus, Ohio 43215
(Names and addresses of agents for service)
Ohio Valley Electric Corporation ("OVEC"), an electric public utility
subsidiary of American Electric Power Company, Inc. ("AEP"), a holding company
registered under the Public Utility Holding Company Act of 1935 ("1935 Act"),
hereby amends its Application-Declaration on Form U-1 in File No. 70-8527, as
follows:
1. By amending and restating the last sentence of the second paragraph of
Post-Effective Amendment No. 3 in its entirety to read as follows:
"OVEC also uses short-term debt for the purchase of SO2 allowances,
material and supplies inventory, interim financing of capital improvements
(including pollution control equipment) pending reimbursement by DOE for
such expenditures or the issuance of long-term debt, and for cash
management to pay general obligations." 2. By adding the following
paragraphs to the end of Item 1:
"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. As set forth below, all applicable conditions of Rule
53(a) are currently satisfied and none of the conditions set forth in Rule
53(b) exist or will exist as a result of the transactions proposed herein,
thereby satisfying such provision and making Rule 53(c) inapplicable.
Rule 53(a)(1). As of September 30, 1999, AEP, through its
subsidiary, AEP Resources, Inc. had aggregate investment in FUCOs of
$826,228,000. This investment represents approximately 48.3% of
$1,711,072,000, 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, 1999.
Rule 53(a)(2). Each FUCO in which AEP invests will maintain books
and records and make available the books and records required by Rule
53(a)(2).
Rule 53(a)(3). No more than 2% of the employees of the subsidiary
companies of AEP will, at any one time, directly or indirectly, render
services to any FUCO.
Rule 53(a)(4). AEP has submitted and will 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 subsidiary
companies.
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
($1,711,072,000) represented an increase of approximately $56,487,000 (or
3.4%) in the average consolidated retained earnings from the previous four
quarterly periods ($1,654,585,000); and (iii) for the fiscal year ended
December 31, 1998, AEP did not report operating losses attributable to
AEP's direct or indirect investments in EWGs and FUCOs.
AEP was authorized to invest up to 100% of its consolidated retained
earnings in EWGs and FUCOs (HCAR No. 26864, April 27, 1998) (the '100%
Order') in File No. 70-9021. In connection with its consideration of AEP's
application for the 100% Order, 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 AEP, nor would it have an adverse impact
on any of the utility subsidiaries or their customers, or on the ability
of state commissions to protect the utility subsidiaries or their
customers."
3. By adding the following paragraph to the end of Item 2. FEES,
COMMISSIONS and EXPENSES:
"The fees, commissions and expenses incurred or expected to be
incurred in connection with the transactions proposed in the Post-Effective
Amendment are estimated not to exceed $2,000."
4. By adding the following Exhibits to ITEM 6. Exhibits:
Exhibit F-1 Opinion of Counsel
Exhibit G Working Funds Flow Statement
(filed confidentially)
SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act of
1935, the undersigned company has duly caused this Post-Effective
Amendment No. 4 to be signed on its behalf by the undersigned thereunto
duly authorized.
OHIO VALLEY ELECTRIC CORPORATION
By: /s/ A. A. Pena
Vice President
Dated: December 3, 1999
Exhibit F-1
614/223-1630
Securities and Exchange Commission
Office of Public Utility Regulation
450 Fifth Street, N.W.
Washington, D.C. 20549
December 3, 1999
Gentlemen:
With respect to the post-effective amendment to the Application or Declaration
on Form U-1 of Ohio Valley Electric Corporation ("OVEC") relating to certain
promissory notes (the "Notes") pursuant to the short-term financing program of
OVEC, I wish to advise you as follows:
I am of the opinion that OVEC is a corporation validly organized and duly
existing under the laws of the state of Ohio.
I am further of the opinion that, in the event that the proposed transactions
are consummated in accordance with said Application or Declaration, as the same
may be amended, and when the steps referred to in the next following paragraph
shall have been taken:
(a) all state laws applicable to the proposed transactions will have
been complied with;
(b) the Notes will be valid and binding obligations of OVEC in
accordance with their terms, except as the same may be limited by
bankruptcy laws or other laws or equitable principles affecting the
enforcement of creditors' rights; and
(c) consummation of the proposed transactions will not violate the legal
rights of the holders of any securities issued by OVEC or any
associate company thereof.
The steps to be taken which are referred to in the next preceding paragraph
consist of the following:
1. appropriate action by the Board of Directors of OVEC with respect
to the transactions described in said Application or Declaration;
2. appropriate action by the Securities and Exchange Commission in
connection with the transactions described in said Application or
Declaration; and
3. issuance and sale of the Notes in accordance with the governmental
and corporate authorizations aforesaid.
I hereby consent to the filing of this opinion as an exhibit to the
above-mentioned Application or Declaration.
Very truly yours,
/s/ David C. House
David C. House
Counsel for
Ohio Valley Electric Corporation
DCH/mms
