Notice is hereby given that the following filing(s) has/have been made with the Commission pursuant to provisions of the Act and rules promulgated under the Act. All interested persons are referred to the application(s) and/or declaration(s) for complete statements of the proposed transaction(s) summarized below. The application(s) and/or declaration(s) and any amendment(s) is/are available for pubic inspection through the Commission's Branch of Pubic Reference.
Interested persons wishing to comment or request a hearing on the application(s) and/or declaration(s) should submit their views in writing by August 7, 2000, to the Secretary, Securities and Exchange Commission, Washington, DC 20549-0609, and serve a copy on the relevant applicant(s) and/or declarant(s) at the address(es) specified below. Proof of service (by affidavit or, in the case of an attorney at law, by certificate) should be filed with the request. Any request for hearing should identify specifically the issues of facts or law that are disputed. A person who so requests will be notified of any hearing, if ordered, and will receive a copy of any notice or order issued in the matter. After August 7, 2000, the application(s) and/or declaration(s), as filed or as amended, may be granted and/or permitted to become effective.
Indiana Michigan Power Company, Inc. (70-7715)
Indiana Michigan Power Company, Inc. (“I&M”), One Summit Square, Fort Wayne, Indiana 46801, an electric utility subsidiary company of American Electric Power Company, Inc., a registered holding company, has filed a post-effective amendment under sections 6(a), 7, 9(a) and 10 of the Act and rule 54 under the Act, to an application-declaration previously filed under the Act.
By prior Commission order dated December 21, 1990 (HCAR No. 25222) (“Prior Order”), I&M was authorized, among other things, to enter into a Nuclear Material Lease Agreement, dated as of December 1, 1990 (“Existing Lease”), with DCC Fuel Corporation (“DCC”), under which I&M leases certain nuclear material (“Nuclear Fuel”) required for use at its Donald C. Cook Nuclear Plant (“Cook Plant”). Under the terms of the Existing Lease, DCC is required to provide up to $110 million of financing to pay the suppliers, processors and manufacturers of Nuclear Fuel, which is leased to I&M for use in the Cook Plant. Correspondingly, I&M is unconditionally obligated to make monthly lease payments to DCC in amounts sufficient to cover the cost of the Nuclear Fuel, operational and financing costs and other associated fees and expenses, including taxes.
Under the Existing Lease, DCC meets its financing obligations by issuing notes under a credit agreement with PruLease and note purchase agreements Start Printed Page 45414with various note purchasers (together, “Creditors”). In the Prior Order, the Commission imposed limits on certain fees and rates applicable to borrowings under these agreements that were incorporated in the payments made under the Existing Lease.
On March 1, 1999, the Creditors informed DCC of their election to terminate their loan commitment obligations effective March 1, 2001 or an earlier date that is mutually acceptable to the parties. I&M now proposes to enter into a new financing arrangement with Bank of America and certain other financial institutions for the lease of Nuclear Fuel.
I&M proposes to enter into a new nuclear fuel lease with DCC (“New Lease”), which will be substantially the same as the Existing Lease. Under the terms of the New Lease, DCC would be required to provide up to $140 million of financing to pay the suppliers, processors and manufacturers of Nuclear Fuel for the Cook Plant. Correspondingly, I&M would be unconditionally obligated to make monthly lease payments to DCC in amounts sufficient to cover the cost of the Nuclear Fuel, operational and financing costs and other associated fees and expenses, including taxes. In addition to the monthly lease payments to DCC, I&M would be obligated to pay a quarterly program fee to certain financial institutions providing DCC with back-up funding, discussed below. The fee will be from .175% to .4% of the total loan commitments of those institutions depending on I&M's debt rating.
DCC will finance the acquisition of the Nuclear Fuel to be leased to I&M through borrowings under a revolving loan agreement with Hatteras Funding Corporation, a special purpose commercial paper funding entity administered by Bank of America (“Primary Purchaser”), and one or more financial institutions (“Liquidity Purchasers”) (“Agreement”). Under the Agreement, notes issued by DCC to the Primary Purchaser will bear interest at the commercial paper rate quoted by the Primary Purchaser, including dealer fees. Notes issued to Liquidity Purchasers will bear interest at LIBOR, plus a margin of between .585% and 1.7% depending upon I&M's debt rating at the time of issuance.
All outstanding notes will mature no later than the termination date of the Agreement. The Agreement will have a term of five years, unless otherwise terminated or extended under the terms of the Agreement.Start Signature
For the Commission by the Division of Investment Management, pursuant to delegated authority.
Jonathan G. Katz,
[FR Doc. 00-18492 Filed 7-20-00; 8:45 am]
BILLING CODE 8010-01-M