Central and South West System Special Executive Retirement Plan Amended and Restated effective January 1, 2020

1.1    Purpose. The Central and South West System Special Executive Retirement Plan is an unfunded, nonqualified deferred compensation plan maintained to provide certain benefits for eligible employees whose retirement benefits from the Retirement Plan (as defined below) are restricted due to limitations imposed by provisions of the Internal Revenue Code or who are entitled to supplemental benefits under the terms of an employment agreement between the eligible employee and a Participating Employer.

1.2    Effective Date. The Plan originally was adopted by Central and South West Corporation in 1979. It later was amended and restated effective as of July 1, 1997 and January 1, 2009. This Plan is now amended and restated effective as of January 1, 2020, except as otherwise provided.

1.3    Plan Sponsor. Central and South West Corporation was the initial sponsor of the Plan. Central and South West Corporation later changed its name to AEP Utilities, Inc. December of 2016, AEP Utilities, Inc. was reorganized and changed its name to AEP Texas, Inc., and the responsibility for sponsorship of the Plan was transferred to American Electric Power Services Corporation, which was already then the Plan Administrator.

The following terms shall have the meanings set forth in this Article II. Any undefined capitalized term in this Plan shall have the meaning set forth in the Retirement Plan.

2.1    “Accredited Service” means the period of time taken into account under the terms of the Retirement Plan for the purpose of computing a Retirement Plan benefit under the Final Average Pay Formula.

2.2    “Actuarial Equivalence” or “Actuarially Equivalent” will be determined using the assumptions and methods that are used in connection with the Cash Balance Formula under the Retirement Plan, regardless of whether the benefits under this Plan are determined under the Cash Balance Formula.

2.3    “Administrator” means American Electric Power Service Corporation.

    

2.4    “Base Compensation” means a Participant's regular base salary or base wage Earned through the date of the termination of employment of the Participant with the Participating Employers. Base Compensation shall be determined (i) without adjustment for any salary or wage elections made pursuant to Sections 125 (regarding cafeteria plans, including pre‑tax contributions for premiums and flexible spending accounts) and 402(e)(3) (regarding elective deferrals, including before-tax contributions under a Section 401(k) retirement savings plan) of the Code, (ii) without reduction for any contributions to the Supplemental Savings Plan; and (iii) excluding bonuses (such as, but not limited to, project bonuses and sign-on bonuses), compensation paid pursuant to the terms of an annual compensation plan, performance pay awards, severance pay, relocation payments, or any other form of additional compensation that is not part of regular base salary or base wage.

2.5    “Beneficiary” means the person or entity designated in accordance with the provisions of Section 7.3, to receive the distribution of death benefits provided for in Article VII.

2.6    “Board of Directors” means the Board of Directors of the Company.

2.7    “Cash Balance Formula” means the formula under the Retirement Plan by which Participants accrue benefits through credits to his or her Cash Balance Account (as defined in the Retirement Plan). The Cash Balance Formula is effective beginning July 1, 1997.

2.8    “Cash Balance Unrestricted Benefit” means the Unrestricted Benefit calculated using the Cash Balance Formula.

2.9    “Code” means the Internal Revenue Code of 1986, as amended from time to time.

2.10    “Commissions” means a periodic incentive directly tied to an individual sale (including sales tied to a deal to which more than one individual is assigned) or quota achievement pursuant to a written and appropriately approved plan that is Earned during the relevant time period, but that is neither a team-based award nor a referral award nor other recognition award nor a part of the Participant’s Base Compensation or Incentive Compensation.

2.11    “Committee” means the committee designated by the Administrator (or a person duly authorized to act on behalf of the Administrator) as responsible for the administration of the Plan.

2.12    “Company” means American Electric Power Service Corporation.

2.13    “Corporation” means American Electric Power Company, Inc., a New York corporation, and its affiliates and subsidiaries.

2.14    “Determination Date” means the first day of the month immediately following the Participant's Termination; provided, however, with respect to Participants who have already separated from service but have not yet received a distribution under the Plan as of December 1, 2008, the Determination Date shall be the date specified in accordance with Article VI for the commencement date for payment of his or her Special Retirement Benefit.

2.15    “Employee” means such persons employed by a Participating Employer who are designated in the records of the Participating Employer in a classification that is eligible to participate in the Retirement Plan.

2.16    “Employment Contract” means an agreement between a Participating Employer and an Employee that provides the Employee with a non-qualified retirement benefit attributable to this Plan.

2.17    “ERISA” means the Employee Retirement Income Security Act of 1974 as amended from time to time.

2.18    “First Date Available” or “FDA” means (a) with respect to a Participant who is a Key Employee as of the date of such Participant’s Termination, the first day of the month next following the date that is six (6) months after the Participant’s Termination; (b) with respect to Participants who have already separated from service but have not yet received a distribution under the Plan as of December 1, 2008, the date specified in accordance with Article VI for the commencement date for payment of his or her Special Retirement Benefit (or, if such Participant fails to specify such a date, January 1, 2009); and (c) with respect to all other Participants, the first day of the month next following the Participant’s Termination.

2.19    “Grandfathered Participant” means a Participant who (i) is an employee of a Participating Employer on July 1, 1997, and (ii) has both attained age 50 and completed at least ten years of vesting service under the Retirement Plan on such date.

2.20    “HR Committee” means the Human Resources Committee of the board of directors of the Corporation (or any successor to such committee).

2.21    “Incentive Compensation” means incentive compensation Earned pursuant to the terms of an annual incentive compensation plan, provided that Incentive Compensation shall not include non-annual bonuses (such as but not limited to project bonuses and sign-on bonuses and amounts earned under a long-term incentive plan), severance pay, relocation payments, or any other form of additional compensation that is not considered to be part of Base Compensation.

2.22    “Key Employee” means a Participant who is classified as a “specified employee” at the time of Termination in accordance with policies adopted by the HR Committee in order to comply with the requirements of Section 409A(a)(2)(B)(i) of the Code and the guidance issued thereunder.

2.23    “Maximum Benefit” means the vested retirement benefit payable from the Retirement Plan under either a Prior Plan Formula or the Cash Balance Formula, as provided in Article IV and Article V and as calculated based upon the Participant’s marital status, Beneficiary, credited service, and earnings for services rendered to the Company, to the extent such are permitted by the Code and the Retirement Plan to be taken into account under the Final Average Pay Formula or the Cash Balance Formula, as applicable.

2.24    “Maximum Disability Period” means the last date any disability benefits may become payable under the terms of the American Electric Power System Long-Term Disability Plan in effect as of the later of December 31, 2008 or the last day on which the Participant’s initial payment election may be made in accordance with Section 6.3.

2.25    “Next Date Available” or “NDA” means the July 1 of the calendar year immediately following the calendar year in which falls the Participant’s Termination.

2.26    “Participant” means any exempt salaried Employee of a Participating Employer who has entered the Plan in accordance with Article III of this Plan and has accrued a benefit under the Plan.

2.27    “Participating Employer” means the Company and each subsidiary of the Corporation that is a participating employer under the Retirement Plan.

2.28    “Plan” means the Central and South West System Special Executive Retirement Plan, as amended and in effect from time to time.

2.29    “Plan Year” means the calendar year commencing each January 1 and ending each December 31.

2.30    “Premium Pay” means overtime pay and shift differential pay that is Earned during the relevant time period, but that is not a part of the Participant’s Base Compensation or Incentive Compensation.

2.31    “Prior Plan Formula” means the Career Average Pay Formula or the Final Average Pay Formula under the Retirement Plan.

2.32    “Retirement Plan” means the Central and South West System Cash Balance Retirement Plan sponsored by the Company, as amended and restated effective July 1, 1997, and as further amended and in effect from time to time, which is a defined benefit pension plan intended to qualify under Section 401(a) of the Code.

2.33    “Special Retirement Benefit” means the basic retirement benefit determined under Article IV of this Plan.

2.34    “Termination” means termination of employment with the Company and its subsidiaries and affiliates for any reason; provided that effective with respect to Participants whose employment terminates on or after January 1, 2005, determinations as to the circumstances that will be considered a Termination (including a disability and leave of absence) shall be made in a manner consistent with the written policies adopted by the HR Committee from time to time to the extent such policies are consistent with the requirements imposed under Code 409A(a)(2)(A)(i).

2.35    “Unrestricted Benefit” means the vested retirement benefit that would be payable from the Retirement Plan under either a Prior Plan Formula or the Cash Balance Formula, as

described in Article IV and Article V, assuming Sections 401(a)(17) (Compensation Limit) and 415 (Limitation on Benefits) of the Code are not applicable. The calculation of the Unrestricted Benefit also shall take into account other adjustments specified in an Employment Contract.

3.1    Eligibility. All exempt salaried Employees of a Participating Employer shall be eligible to participate in this Plan so long as such Employee is either (A) entitled to a Special Retirement Benefit under the terms of an Employment Contract, or (B) both (1) a participant in the Retirement Plan, and (2) satisfies one of the following conditions below:

All such eligibility determinations generally shall be made by December 31 of each year or such other time as set forth in an Employee Contract.

To further clarify, an Employee shall not be considered eligible to participate in this Plan unless such Employee has been continuously eligible to earn benefits under the Central and South West Corporation Cash Balance Retirement Plan since prior to January 1, 2001, the date that individuals hired or rehired by a Participating Employer would have instead become eligible to participate in the American Electric Power System Retirement Plan (as it existed prior to the merger of the Central and South West Corporation Cash Balance Retirement Plan with and into that plan effective December 31, 2008) and its related American Electric Power System Excess Benefit Plan.

3.2    Duration. An Employee who becomes a Participant shall continue to be a Participant until his or her Termination or the date he or she is no longer entitled to receive a Special Retirement Benefit under this Plan.

4.1    General Benefits. Upon a Participant's Termination, the Participant shall be entitled to a Special Retirement Benefit calculated as of the Participant’s Determination Date, as determined under this Article IV, to the extent vested, to be paid at the time and in the form determined in accordance with Article VI of this Plan. Except as otherwise specified in Article X, a Participant’s Special Retirement Benefit shall become vested at the same time and to the same extent as may be provided under the terms of the Retirement Plan. Notwithstanding the foregoing, the amount, calculation methodology, or vesting of a Participant’s Special Retirement Benefit may be reduced or otherwise modified in the manner described in an Employment Contract. Additionally, if the Committee determines that a Participant has incurred a liability to, or otherwise damaged, the Corporation, the Company or any Participating Employer, the Committee shall have the authority and power, in its sole discretion, to reduce any portion or all of the amounts that might otherwise become payable to such Participant under the terms of this Plan by the amount of such liability or damage, as reasonably determined by the Committee.

4.2    Calculation Methodology. For purposes of calculating the Special Retirement Benefit under Sections 4.3, 4.4 and 4.5 of this Plan, the following rules shall apply.

Termination by comparing the annuity payable in the normal form under the Retirement Plan assuming that payments will commence on the Determination Date. The value of any annuity benefit payable that includes a cost of living adjustment shall be determined assuming that the future cost of living adjustments will be three percent (3%) per year.

4.6    Disability Accruals. Notwithstanding anything in the Plan to the contrary, if a Participant incurs a Disability (under the terms of the Retirement Plan), the Participant may continue to accrue a benefit under this Plan from the date of such Disability through the Maximum Disability Period to the extent the Participant is receiving such disability accruals under the Retirement Plan, as paid in accordance with Section 6.6.

5.1    Eligibility -- Cash Balance Participants. Only Participants who were identified as of May 31, 2000, to receive a Final Average Pay Cash Balance benefit are entitled to have the Pension Equity Floor calculation described in Section 5.2.

5.2.    Potential Enhancement of Benefit. The “Pension Equity Floor” for an eligible Participant under Section 5.1 of this Plan shall be equal to the benefit that would be payable under the cash balance provisions of the Retirement Plan if:

If the Pension Equity Floor is greater than the Cash Balance Unrestricted Benefit, the Pension Equity Floor shall be substituted in place of the Cash Balance Unrestricted Benefit under Section 4.3, 4.4, or 4.5, as applicable.

6.1    Determination of Special Retirement Benefit. Upon a Participant’s Termination for any reason other than the Participant’s death, the Participant’s Special Retirement Benefit shall be calculated as of the Participant’s Determination Date and, to the extent vested, distributed to the Participant in the manner described in Section 6.2. If the Special Retirement Benefit is payable in the form of a lump sum or installments, any unpaid balance shall be credited with interest at the Annual Interest Crediting Rate under the Retirement Plan from the Determination Date until the date of payment.

6.2    General Timing of Payment. A Participant generally is entitled to receive a Special Retirement Benefit upon Termination. Payment generally will be made at the following times and in the following forms, as specified in a Participant’s Payment Election.

Effective for distribution elections or changes to distribution elections made on or after such date as the Committee shall designate:

or her benefits in the form of any other annuity option available under Section 6.2(b)(4) or (5) of this Plan. If the Participant fails to make a timely election as to the form of annuity, the Participant shall be deemed to have selected a 100% joint and survivor annuity with the Participant’s Beneficiary as the survivor annuitant.

6.4    Rehired Employees. An Employee whose employment is Terminated and then subsequently hired as an Employee of a Participating Employer after January 1, 2001, may not become an active Participant in the Plan with respect to compensation earned or service after such prior Termination.

6.5    Changes to Time and Form of Payment. A Participant will not be permitted to change the form of payment of his or her Special Retirement Benefit unless (a) such election does not take effect until at least 12 months after the date on which the election is made, (b) in the case of an election related to payment not due to the Participant’s Disability or death, the first payment with respect to which such new election is effective is deferred for a period of not less than five (5) years from the date such payment would otherwise have been made, and (c) any election related to a payment based upon a specific time or pursuant to a fixed schedule may not be made less than 12 months prior to the date of Termination; provided, however, that an election to change from one type of annuity payment to a different, Actuarially Equivalent type

of annuity payment shall not be considered a change to the form of payment for purposes of applying the restrictions and clauses (a), (b) and (c).

Notwithstanding the preceding paragraph of this Section 6.5, a Participant may change an election with respect to the time and form of payment of a Special Retirement Benefit, without regard to the restrictions imposed under the preceding paragraph, on or before December 31, 2008; provided that such election (a) applies only to amounts that would not otherwise be payable in the calendar year in which such election is made, and (b) shall not cause an amount to be paid in the calendar year in which the election is made that would not would otherwise be payable in such year.

6.6    Disability Payments. If a Participant incurs a Disability that results in a Termination, the payment(s) of any accruals through such Termination will be governed by Section 6.2. A Participant who is receiving Disability accruals under Section 4.6 after Termination shall receive payment of the Supplemental Retirement Benefits accrued after Termination in a lump sum as soon as practicable after the Maximum Disability Period.

7.1    Death of Participant Before Determination Date. Upon the death of a Participant prior to the Participant's Determination Date, the Participant’s Beneficiary shall be entitled to a deceased Participant’s Special Retirement Benefit under Article IV or Article V, whichever is applicable, as follows:

7.2    Death of Participant After the Determination Date. Upon the death of the Participant after the Determination Date, the Participant’s Beneficiary or Beneficiaries shall receive the balance, if any, of the distributions payable under the form of distribution then in effect with respect to the Participant. If the Beneficiary is receiving benefits, the Beneficiary shall be entitled to designate a beneficiary for benefits payable upon the death of the Beneficiary.

7.3    Beneficiary Designation. Each Participant (or Beneficiary) may designate a Beneficiary or Beneficiaries who shall receive the benefits payable under this Plan following the death of the Participant. Any designation, or change or rescission of a beneficiary designation shall be made by the Participant’s completion, signature and submission to the Committee of the appropriate beneficiary designation form prescribed by the Committee. A beneficiary designation form shall take effect as of the date the form is signed, provided that the Committee receives it before taking any action or making any payment to another Beneficiary named in accordance with this Plan and any procedures implemented by the Committee. If any payment is made or other action is taken before the Committee receives a beneficiary designation form, any changes made on a form received thereafter will not be given any effect. If a Participant (or Beneficiary) fails to designate a Beneficiary, or if all Beneficiaries named by the Participant (or Beneficiary) do not survive the Participant (or Beneficiary), the Participant’s (or Beneficiary’s) benefit will be paid to the Participant’s Beneficiary or Beneficiaries as determined under the terms of the Retirement Plan as of the date of the Participant’s death, but no later than the latest benefit commencement date with respect to the Participant under the Retirement Plan. The designation by a Participant of the Participant’s spouse as a Beneficiary shall be considered automatically revoked as to that spouse upon the legal termination of the Participant’s marriage to that spouse unless a qualified domestic relations order that provides otherwise is received by the Committee a reasonable time before the benefits commence.

8.1    Authority of Committee. The Committee shall administer this Plan. The Committee shall have the full power, authority and discretion to interpret this Plan and to prescribe, amend and rescind rules and regulations relating to the administration of this Plan (including, but not limited to, procedures for submitting distribution election forms and the designation of beneficiaries), and all such interpretations, rules and regulations shall be conclusive and binding on all Participants.

8.2    Ability of Committee to Delegate Authority. The Committee may employ agents, attorneys, accountants, or other persons and allocate or delegate to them powers, rights, and duties all as the Committee determines, in its sole discretion, may be necessary or advisable to properly carry out the administration of this Plan.

9.1    Authority to Amend or Terminate Plan. The Company intends this Plan to be permanent but reserves the right to amend or terminate this Plan when, in the sole opinion of the Company, such amendment or termination is advisable. Any such amendment or termination shall be made in accordance with a resolution of the Board of Directors of the Company.

9.2    Limitations on Amendment and Termination Authority. No amendment or termination of this Plan shall directly or indirectly (a) deprive any current or former Participant or Beneficiary of all or any portion of any Special Retirement Benefit which commenced prior to the effective date of such amendment or termination or (b) reduce any Participant’s Unrestricted Benefit that had accrued as of such effective date.

10.1    Vesting. Notwithstanding any provisions of the Plan to the contrary, if a Change in Control, as defined in Section 10.2, of the Corporation occurs, all Special Retirement Benefits accrued as of the date of the Change in Control shall be fully vested and non-forfeitable.

10.2    Definition. A “Change in Control” of the Corporation shall be deemed to have occurred if and as of such date that (i) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934 (“Exchange Act”)), other than any Corporation owned, directly or indirectly, by the shareholders of the Corporation in substantially the same proportions as their ownership of stock of the Corporation or a trustee or other fiduciary holding securities under any employee benefit plan of the Corporation, becomes “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of more than one-third (⅓) of the then outstanding voting stock of the Corporation; or (ii) the consummation of a merger or consolidation of the Corporation with any other entity, other than a merger or consolidation which would result in the voting securities of the Corporation outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least two-thirds (⅔) of the total voting power represented by the voting securities of the Corporation or such surviving entity outstanding immediately after such merger or consolidation; or (iii) the consummation of the complete liquidation of the Corporation or the sale or disposition by the Corporation (in one transaction or a series of transactions) of all or substantially all of the Corporation’s assets.

For purposes of this Section 10.2, “Board” shall mean the Board of Directors of the Corporation, and “Director” shall mean an individual who is a member of the Board.

11.1    Procedure for Submitting a Claim for Benefits. The following procedures shall apply with respect to claims for benefits under the Plan.

11.2    Procedure for Appealing an Adverse Benefit Determination. The following procedures shall apply with respect to the review on appeal of an adverse determination on a claim for benefits under the Plan.

12.1    No Right of Employment. Nothing in this Plan shall interfere with or limit in any way the right of the Company to terminate any Participant's employment at any time, nor confer upon a Participant any right to continue in the employ of the Company.

12.2    Incompetence. In the event the Committee, in its sole discretion, shall find that a Participant, former Participant or Beneficiary is unable to care for his or her affairs because of illness or accident, or is a minor, or has died, the Committee may direct that any payment due the Participant or the Beneficiary be paid, unless a prior claim shall have been made by a duly appointed legal representative, to the Participant’s Spouse, a child, a parent or other blood relative, or to a person with whom the Participant resides, and any such payment so made shall be a complete discharge of the liabilities of the Plan and the Company and the Participating Employer with respect to such Participant or Beneficiary.

12.3    Relationship with Retirement Plan. Except as otherwise expressly provided herein, all terms, conditions and actuarial assumptions of the Retirement Plan applicable to benefits payable under the terms of the Retirement Plan shall also be applicable to the Special Retirement Benefits paid under the terms of the Plan.

12.4    Unsecured General Creditor. The Special Retirement Benefits paid under the Plan shall not be funded, but shall constitute liabilities of the Participating Employers to be paid out of general corporate assets. Nothing contained in the Plan shall constitute a guaranty by the Participating Employers or any other entity or person that the assets of a particular Participating Employer will be sufficient to pay any benefit hereunder. Participants and their Bene-ficiaries, heirs, successors and assigns shall have no legal or equitable rights, interests or claims in any property or assets of a Participating Employer. For purposes of the payment of benefits under this Plan, any and all of a Participating Employer’s assets shall be, and remain, the general, unrestricted assets of the Participating Employer. A Participating Employer’s obligation under the Plan shall be merely that of an unfunded and unsecured promise to pay money in the future.

12.5    Non-Assignability. Neither a Participant nor any other person shall have any right to sell, assign, transfer, pledge, mortgage or otherwise encumber, transfer, alienate or convey in advance of actual receipt, the amounts, if any, payable under this Plan. Such amounts payable, or any part thereof, and all rights to such amounts payable are not assignable and are not transferable. No part of the amounts payable shall, prior to actual payment, be subject to seizure, attachment, garnishment or sequestration for the payment of any debts, judgments, alimony or separate maintenance owed by a Participant or any other person. Additionally, no part of any amounts payable shall, prior to actual payment, be transferable by operation of law in the event of a Participant’s or any other person’s bankruptcy or insolvency or be transferable to a spouse as a result of a property settlement or otherwise, except that if necessary to comply with a “qualified domestic relations order,” as defined in ERISA Section 206(d), pursuant to which a court has determined that a Spouse or former Spouse of a Participant has an interest in the Participant’s benefits under the Plan, the Committee shall distribute the Spouse’s or former spouse’s interest in the Participant’s benefits under the Plan to such Spouse or former Spouse in

accordance with the Participant’s election under this Plan as to the time and form of payment; provided, however, that the Spouse’s or former Spouse’s benefit will be subject to the automatic cash-out provisions of Section 6.7 as a separate benefit.

12.6    Captions. The captions of the articles, sections and paragraphs of this Plan are for convenience only and shall not control or affect the meaning or construction of any of its provisions.

12.7    Governing Law. The Plan shall be construed and administered according to the applicable provisions of ERISA and the laws of the State of Ohio.

12.8    Validity. In case any provision of this Plan shall be illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of this Plan. Instead, this Plan shall be construed and enforced as if such illegal or invalid provision had never been inserted herein.

12.9    Successors. The provisions of this Plan shall bind and inure to the benefit of the Participant's Employer and its successors and assigns and the Participant and the Participant's designated Beneficiaries.

12.10    Notice. Any notice or filing required or permitted to be given to the Committee under this Plan shall be sufficient if in writing and hand-delivered, or sent by registered or certified mail, to the address below:

Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification. Any notice or filing required or permitted to be given to a Participant under this Plan shall be sufficient if in writing and hand-delivered, or sent by mail, to the last known address of the Participant.

12.11    Tax Withholding. There shall be deducted from each payment made under this Plan or any other compensation payable to the Participant (or Beneficiary) all taxes that are required to be withheld by the Company in respect to any payment under this Plan. The Company shall have the right to reduce any payment (or compensation) by the amount of cash sufficient to provide the amount of such taxes.