FORT WAYNE, Ind., Oct. 12, 1999 – American Electric Power (NYSE: AEP) will expand its state office in the Indiana capital of Indianapolis, and establish a permanent, full-time state office in the Michigan capital of Lansing, said Bill Lhota, AEP executive vice president -- Energy Delivery & Customer Relations. Both moves will be made by the end of the first quarter 2000. "The presence of state offices in capitals outside the traditional service territories is a first for AEP," said Lhota. "This signals AEP's intent to be a more active leader in the restructured market, and to play a more significant role as we work to develop public policy for our industry." The Indianapolis office, which currently comprises a single governmental affairs manager, Jeff Drozda, will be expanded and headed by a state president. Reporting to the state president will be the governmental affairs manager, a corporate communications manager, an environmental manager and an administrative assistant. The Michigan office will be headed by a state president, and include positions supporting governmental affairs, corporate communications and administrative duties. Additional positions and personnel will be named later as plans unfold and opportunities are identified. John Sampson, AEP president for Indiana and Michigan, will head the Indianapolis office. He will also continue to operate as president of both Indiana and Michigan until the Michigan state president has been named. No other personnel announcements were made. The announcements were made following a lengthy study of goals and objectives by the Indiana/Michigan state office team, which also looked at business conditions and opportunities in both states. The study was done in conjunction with the AEP/CSW merger transition teams which are setting best practice standards for the new AEP. "The mission of the state office team is to take our message to the external audiences that will impact AEP's future — legislators, regulators and other decision makers, most of whom are located in the state capitals," said Sampson. "It's important that we position ourselves to effectively interact with political, regulatory and business leaders who are developing the rules for restructuring our industry, and who are going to have significant impact on our future." "The decision to expand the Indianapolis office made good business sense," said Lhota. "As the state team determined its goals, built action plans, and benchmarked its work against similar operations in other companies, it became obvious that we needed to expand our presence and influence in Indianapolis." Establishing a state office in Michigan also made sense for a number of reasons, he added. -- Michigan is deregulating its electric utility industry, and AEP needs to be actively engaged in the discussions as the rules for competition are written. -- AEP has 125,000 customers in Michigan. -- AEP has considerable assets in Michigan, including a two-unit nuclear plant, as well as an extensive distribution and transmission infrastructure. -- AEP is a low-cost utility that anticipates that it can compete effectively in Michigan which is a high-cost state. -- Michigan is a state with an immense industrial base that should provide AEP with real opportunities for the sale of both energy and services. "While expanding the state office in Indianapolis and establishing a state team in Lansing will improve the effectiveness of our public policy efforts," said Sampson, "it's important that the state teams maintain strong ties to the communities we serve." For that reason, Sampson will continue to maintain an office in Fort Wayne and participate on various local boards. "We're an integral part of our communities, and it's important that state office teams stay connected and involved," he said. AEP, a global energy company, is one of the United States' largest investor-owned utilities, providing energy to 3 million customers in Indiana, Kentucky, Michigan, Ohio, Tennessee, Virginia and West Virginia. AEP has holdings in the United States, the United Kingdom, China and Australia. Wholly owned subsidiaries provide power engineering, energy consulting and energy management services around the world. The company is based in Columbus, Ohio. On Dec. 22, 1997, AEP announced a definitive merger agreement for a tax-free, stock-for-stock transaction with Central and South West Corp., a public utility holding company based in Dallas.