American Electric Power borrows fully from new $1 billion agreement

Chicago, March 23 – American Electric Power Co., Inc. said that the company has entered into a $1 billion credit agreement on March 23 with PNC Bank, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

The company has borrowed the full amount under the agreement.

Under the agreement, the company must maintain its percentage of debt to total capitalization at a level that does not exceed 67.5%.

The method for calculating outstanding debt and other capital is contractually defined in the agreement.

The acceleration of the company’s payment obligations, or the obligations of certain of its respective subsidiaries, prior to maturity under any other agreement or instrument relating to debt outstanding in excess of $50 million would cause an event of default under the credit agreement and permit the lenders to declare outstanding amounts payable.

Proceeds will be used to reduce outstanding commercial paper and for general corporate purposes.

According to the filing, the company expects “to have sufficient liquidity in the form of cash on hand and from operations and available credit capacity to support our funding needs.”

American Electric Power is a Columbus, Ohio-based electricity provider.

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