Columbus, Ohio, and Dallas, Texas (November 12, 1998) -- American Electric Power Company, Inc. ("AEP")[NYSE: AEP] and Central and South West Corporation ("CSW")[NYSE: CSR] have reached settlements with several groups in Texas and Arkansas regarding the pending merger of the two companies. Additionally, the Nuclear Regulatory Commission (NRC) on Nov. 5 approved the license transfer application filed by CSW´s Central Power and Light Company subsidiary regarding the South Texas Project nuclear power plant.

In Texas, AEP and CSW have reached a settlement in principle with the Office of Public Utility Counsel and the Steering Committee of the cities of McAllen, Corpus Christi, Victoria, Abilene, Big Lake, Vernon and Paducah. The settlement resolves all issues of the signing parties. A further filing with supporting testimony is expected.

As a result of the settlement, Administrative Law Judge Kathleen Sanford on Nov. 10 suspended the procedural schedule and announced that a pre-hearing conference will be held Nov. 17. The purpose of that pre-hearing conference will be to determine the schedule for consideration of the settlement by other parties relating to AEP and CSW´s application for merger approval by the Public Utility Commission of Texas (PUCT).

In Arkansas, AEP, CSW and Southwestern Electric Power Company (SWEPCO), a CSW subsidiary, have reached a settlement with the general staff of the Arkansas Public Service Commission (APSC) on the regulatory plan phase related to the proposed merger. The settlement calls for SWEPCO to reduce rates for its Arkansas customers by amounts totaling approximately $6 million over the five-year period following completion of the merger.

The parties filed the stipulated settlement with the APSC on Nov. 3. The parties also filed a joint motion to cancel the current testimony schedule and request approval of the signed stipulation and agreement. The APSC has granted the motion, and the hearing to consider approval of the settlement is scheduled for Dec. 1.

"We´re very pleased that the signing parties have been able to support settlements that provide benefits for all groups," said Mark Roberson, CSW vice president of regulatory affairs. "Approval of these agreements will help us achieve our goal of allowing the newly combined company to serve customers more efficiently and effectively and to be better able to keep rates low in an increasingly competitive electric utility industry. We hope that our state Commissions and other parties also will join us in supporting these settlements."

CPL´s application to the NRC requested the agency´s consent to the indirect transfer of control of CPL´s interests in the NRC licenses issued with respect to STP upon completion of the merger. CPL will continue to own its 25.2 percent share of the plant, located near Bay City, Texas, and CPL´s name will remain on the NRC operating license.

Applications seeking approval of the merger also have been filed with the Oklahoma Corporation Commission, the Louisiana Public Service Commission, the Federal Energy Regulatory Commission and the Securities and Exchange Commission.

Central and South West Corporation is a Dallas-based public utility holding company that owns four U.S. electric utility subsidiaries with 1.7 million customers, a regional electricity company serving 2 million customers in the United Kingdom, and nonutility subsidiaries involved in energy-related investments as well as subsidiaries that offer telecommunications, energy efficiency and financial transactions. On Dec. 22, 1997, CSW announced a definitive merger agreement for a tax-free, stock-for-stock transaction with AEP.

American Electric Power Company, Inc., 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.