ex10icpdeferral.htm


    AMERICAN
ELECTRIC POWER SYSTEM

    INCENTIVE
COMPENSATION DEFERRAL PLAN

    


    (As
Amended and Restated Effective January 1, 2008)

    


    


    ARTICLE
I

    


    PURPOSE
AND EFFECTIVE DATE

    


    1.1  The American Electric
Power System Incentive Compensation Deferral Plan (the “Plan”) was established
by American Electric Power Service Corporation and such subsidiaries and
affiliates designated by the Company for participation in the Plan (“AEP”) to
allow Eligible Employees to elect to defer receipt of all or a portion of their
Incentive Compensation until after their termination of employment.

    


    1.2  The Plan was most
recently amended and restated effective January 1, 2005 pursuant to a document
that was signed on December 28, 2006.  The Plan is now amended and
restated again, effective January 1, 2008.  Except as otherwise
specifically provided herein, the effective date of the Plan, as amended and
restated by this document, is January 1, 2008. This amended and restated Plan
continues to apply to all deferrals of compensation made under the Plan, unless
specifically provided otherwise herein.

    


    


    ARTICLE
II

    


    DEFINITIONS

    


    2.1  “Account” means the
separate memo account established and maintained by the Company or the
recordkeeper employed by the Company to record Participant deferrals of
Incentive Compensation and to record any related Investment Income on the Fund
or Funds selected by the Participant or Former Participant. The portion of the
Account attributable to Incentive Compensation earned and vested prior to
January 1, 2005 (excluding, for this purpose Incentive Compensation attributable
to 2004 that was subject to discretionary adjustment and first available for
payment subsequent to December 31, 2004) shall be referred to as the
Participant’s “Legacy Account Balance.” The portion of the Account attributable
to Incentive Compensation other than that described in the immediately preceding
sentence shall be referred to as the Participant’s “Active Account
Balance.”

    


    2.2  “Base Compensation”
means an employee’s regular annual base salary or wage rate determined without
regard to any salary or wage reductions made pursuant to sections 125 or
402(e)(3) of the Code or participant contributions pursuant to a pay reduction
agreement under the American Electric Power System Supplemental Retirement
Savings Plan, as amended.

    


    2.3  “Claims
Reviewer” means the person or committee designated by American Electric Power
Service Corporation (or by a duly authorized person) as responsible for the
review of claims for benefits under the Plan in accordance with Section 8.1.
Until changed, the Claims Reviewer shall be the Director - Compensation and
Executive Benefits.

    


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

    


    2.5  “Committee” means the
committee designated by the American Electric Power Service Corporation (or by a
duly authorized person) as responsible for the administration of the
Plan.  Until changed, the Committee shall consist of the employees of
the Company holding the following positions: employees of the Company holding
the following positions: head of the Human Resources department (currently, Vice
President Human Resources); the employee to whom the head of the Human Resources
department reports (currently, Senior Vice President – Shared Services) and the
chief financial officer of the Company.  The Committee may authorize
any person or persons to act on its behalf with full authority in regard to any
of its duties and hereunder other than those set forth in Section
8.2.

    


    2.6  “Company” means American
Electric Power Service Corporation.

    


    2.7  “Eligible Employee”
means any employee of AEP is designated by the Company as eligible to
participate in this Plan, provided that effective for deferral election periods
that begin after January 1, 2005, such employee must be employed at exempt
salary grade 28 or higher.  Individuals not directly compensated by
AEP or who are not treated by AEP as an active employee shall not be considered
Eligible Employees.

    


    2.8  “Executive Officer”
means Participant who, with respect to AEP, is subject to the disclosure
requirements set forth in Section 16 of the Securities Exchange Act of 1934, as
amended.

    


    2.9  “First
Date Available” or “FDA” means (a) with respect to Key Employees, the last day
of the month coincident with or next following the date that is six (6) months
after the date of the Participant’s or Former Participant’s Termination; and (b)
with respect to all other Participants and Former Participants, the last day of
the month coincident with or next following the date that is one (1) month after
the date of the Participant’s Termination; provided, however, that the FDA with
respect to an Executive Officer shall be no earlier than the December 31of the
calendar year of such Executive Officer’s Termination.

    


    2.10  “Former Participant”
means a Participant whose employment with AEP has terminated or a Participant
who is no longer an Eligible Employee, but whose Account has a balance greater
than zero.

    


    2.11  “Fund” means the
investment options made available to participants in the American Electric Power
System Retirement Savings Plan, as revised from time to time, except as the
Committee may specify otherwise.  The investment options under the
American Electric Power System Retirement Savings Plan were revised effective on
or about July 5, 2006 in connection with a transition of the recordkeeping and
trustee services from Fidelity Management Trust Company to affiliates of JP
Morgan Chase Bank, NA.  The investments made available through the
self-directed brokerage account option thereupon being offered under the
American Electric Power System Retirement Savings Plan shall not be available to
Participants in this Plan.

    


    2.12  “Incentive
Compensation” means incentive compensation payable pursuant to the terms of
annual and long-term incentive compensation plans approved by the Committee for
inclusion in the Plan, provided that such incentive compensation shall be
determined (a) without regard to (i) any salary or wage reductions made pursuant
to sections 125 or 402(e)(3) of the Code or (ii) participant contributions
pursuant to a pay reduction agreement under the American Electric Power System
Supplemental Retirement Savings Plan, as amended, but (b) after any deferral
thereof pursuant to the American Electric Power System Stock Ownership
Requirement Plan, as amended.  Incentive Compensation will not include
Base Compensation, non-annual bonuses compensation (such as but not limited to
project bonuses and sign-on bonuses), severance pay, or relocation
payments.

    


    2.13  “Investment Income”
means, with respect to Incentive Compensation deferred under this Plan, the
earnings, gains and losses that would be attributable to the investment of such
deferrals in a Fund or Funds.

    


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

    


    2.15  “Next Date Available”
or “NDA” means the June 30 of the calendar year immediately following the
calendar year in which falls the Participant’s Termination.

    


    2.16  “Participant” means an
Eligible Employee who elects to defer part or all of his or her Incentive
Compensation.  Except to the extent otherwise specified in this Plan,
references to a Participant shall be considered to include a Former
Participant.

    


    2.17  “Plan Year” means the
twelve-month period commencing each January 1 and ending the following December
31.

    


    2.18  “Retire”
means that a Participant terminates employment with AEP and its subsidiaries and
affiliates after both attaining age 55 and the completing five years of service
with AEP.

    


    2.19  “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).

    


    2.20  “2005 Distribution
Election Period” means the period or periods designated by the Committee during
which Participants (or Former Participants) are given the opportunity to select
among the distribution options set forth in Article VI, provided that any such
period shall end no later than December 31, 2005.

    


    2.21  “2006 Distribution
Election Period” means the period or periods designated by the Committee during
which Participants (or Former Participants) are given the opportunity to select
among the distribution options set forth in Article VI, provided that any such
period shall end no later than December 31, 2006.

    


    2.22  ”Applicable Tax
Payments” means the following types of taxes that AEP may withhold and pay that
are applicable to the amount credited to the Participant’s Account:

    


    (a)           Federal
Insurance Contributions Act (FICA) tax imposed under Code Sections 3101, 3121(a)
and 3121(v)(2) (the “FICA Amount”);

    


    (b)           Income
tax at source on wages imposed under Code Section 3401 or the corresponding
withholding provisions of applicable state, local and foreign tax laws as a
result of the payment of the FICA Amount; and

    


    (c)           The
additional income tax at source on wages attributable to pyramiding Code Section
3401 wages and taxes;

    


    provided,
however, that the total Applicable Tax Payments may not exceed such limits as
may be applicable to comply with the requirements of Code Section
409A.

    


    


    ARTICLE
III

    


    ADMINISTRATION

    


    3.1  The
Committee shall have full discretionary power and authority (i) to administer
and interpret the terms and conditions of the Plan; (ii) to establish reasonable
procedures with which Participants, Former Participant and beneficiaries must
comply to exercise any right or privilege established hereunder; and (iii) to be
permitted to delegate its responsibilities or duties hereunder to any person or
entity.  The rights and duties of the Participants and all other
persons and entities claiming an interest under the Plan shall be subject to,
and bound by, actions taken by or in connection with the exercise of the powers
and authority granted under this Article.

    


    3.2  The
Committee may employ agents, attorneys, accountants, or other persons and
allocate or delegate to them powers, rights, and duties all as the Committee may
consider necessary or advisable to properly carry out the administration of the
Plan.

    


    3.3  The
Company shall maintain, or cause to be maintained, records showing the
individual balances in each Participant’s Account.  Statements setting
forth the value of the amount credited to the Participant's Account as of a
particular date shall be made available to each Participant no less often than
quarterly.  The maintenance of the Account records and the
distribution of statements may be delegated to a record keeper by either the
Company or the Committee.

    


    


    ARTICLE
IV

    


    PARTICIPATION

    


    4.1  An Eligible Employee
shall become a Participant by making a deferral election during an applicable
election period on a form prescribed by the Company to defer part or all of the
Eligible Employee’s Incentive Compensation to which such election relates,
provided that such election shall not result in the deferral of Incentive
Compensation in excess of an amount that allows for the current payment of
Applicable Tax Payments.

    


    4.2  For purposes of Section
4.1, the election period during which Incentive Compensation may be subject to
an effective deferral election shall be determined as follows:

    


    (a)           To
the extent that the Incentive Compensation is “performance-based compensation”
(within the meaning of Section 409A(a)(4)(B)(iii) of the Code) that is based on
services performed over a period of at least 12 months, the election period
shall end no later than six (6) months before the end of the performance
period.

    


    (b)           To
the extent that the Incentive Compensation is not described in Section 4.2(a),
the election period shall end on or before December 31 of the calendar year
prior to the year in which the services on which the Incentive Compensation is
based are to be performed.

    


    (c)           Notwithstanding
(a) and (b), in the case of the first year in which an Eligible Employee becomes
eligible to participate in the Plan, and the Participant has not previously
become a Participant in another plan that is required to be aggregated with this
Plan under Treasury Regulation Section 1.409A-1(c)(2) or other guidance of the
Code, the election period shall end within 30 days after the date such Eligible
Employee became eligible to participate and such election shall apply only with
respect to compensation paid for services performed subsequent to the
election.

    


    4.3  If a deferral election
is not made by the end of the election period prescribed by the Company with
regard to certain Incentive Compensation that may be earned by an Eligible
Employee, no portion of such Incentive Compensation shall be deferred for such
Eligible Employee.

    


    4.4  Incentive Compensation
that is deferred under this Plan shall be credited to the Participant’s Account
as follows:

    


    (a)           Deferred
Incentive Compensation that had been earned and vested prior to January 1, 2005
has been credited to the Participant’s Legacy Account Balance.  No
additional amounts of Incentive Compensation that is deferred under the terms of
this Plan shall be credited to a Legacy Account Balance.

    


    (b)           Deferred
Incentive Compensation that is earned or vested on or after January 1, 2005
shall be credited to the Participant’s Active Account Balance.  This
shall include the deferral under this Plan of Incentive Compensation
attributable to 2004 that was subject to discretionary adjustment and first
available for payment subsequent to December 31, 2004.

    


    4.5           The
Termination (or any subsequent re-employment) of a Participant after such
Participant has submitted an election to defer any Incentive Compensation shall
not affect the terms of such election with respect to the Incentive Compensation
to which such election relates, subject, however, to the provisions for the
distribution of any such deferred Incentive Compensation pursuant to the
provisions of Article VI.

    


    


    ARTICLE
V

    


    INVESTMENT
OF DEFERRED AMOUNTS

    


    5.1  Amounts credited to the
Participant’s Account (without regard to whether such Account is allocated to
such Participant’s Legacy Account Balance or Active Account Balance) shall be
further credited with earnings as if invested in the Funds selected by the
Participant.  To the extent the Participant fails to select Funds for
the investment of Contributions under the Plan, the Participant shall be deemed
to have selected the Managed Income Fund option. The Participant may change the
selected Funds by providing notification in accordance with the Plan’s
procedures.  Any change in the Funds selected by the Participant shall
be implemented in accordance with the Plan’s procedures.

    


    5.2  A Participant may elect
to transfer all or a portion of the amounts credited to his Account from any
Fund or Funds to any other Fund or Funds by providing notification in accordance
with the Plan’s procedures.  Such transfers between Funds may be made
in any whole percentage or dollar amounts and shall be implemented in accordance
with the Plan’s procedures.

    


    5.3  The amount credited to
each Participant's Account shall be determined daily based upon the fair market
value of the Fund or Funds to which that Account is allocated.  The
fair market value calculation for a Participant's Account shall be made after
all deferrals, distributions, Investment Income and transfers for the day are
recorded.  A Participant’s Account, as adjusted from time to time,
shall continue to be credited with Investment Income until the balance of the
Account is zero and the Committee anticipates no additional contributions from
such Participant.

    


    5.4  The Plan is an unfunded
non-qualified deferred compensation plan and therefore the deferrals credited to
a Participant's Account and the investment of those deferrals in the Fund or
Funds selected by the Participant are memo accounts that represent general,
unsecured liabilities of the Company payable exclusively out of the general
assets of the Company. In the event that the Company becomes insolvent, the
Participants shall be considered as general unsecured creditors of the
Company.  A Participant’s rights to benefits under this Plan shall not
be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge encumbrance, attachment or garnishment by creditors of any
Participant or any beneficiary.

    


    


    ARTICLE
VI

    


    DISTRIBUTIONS

    


    6.1  Upon a Participant’s
Termination for any reason, the Company shall cause the Participant or the
Former Participant to be paid the full amount credited to his or her Account in
accordance with the following rules:

    


    (a)           Legacy Account
Balance. With regard to the Participant’s Legacy Account
Balance

    


    
      	
               
      

            	
              (1)

            	
              Pre-Retirement
      Cash-Out.  If the Participant has not Retired, the
      Company shall cause the Participant to be paid the full amount credited to
      his or her Legacy Account Balance in a single lump sum.  The
      payment shall be made within 60 days after the Participant’s
      Termination.

            


    

    


    
      	
               
      

            	
              (2)

            	
              Post-Retirement As
      Elected.  If the Participant has Retired, amounts that
      are credited to the Participant's Legacy Account
  Balance:

            


    

    


    
      	
               
      

            	
              (A)

            	
              Shall
      be distributed to the Participant in one of the following optional forms
      as selected by the Participant:

            


    

    


    
      	
               
      

            	
              (i)

            	
              A
      single lump-sum payment, or

            


    

    


    
      	
               
      

            	
              (ii)

            	
              In
      annual installment payments over not less than two nor more than ten
      years.

            


    

    


    
      	
               
      

            	
              (B)

            	
              Shall
      be paid in the form of distribution selected by the Participant pursuant
      to paragraph (A) shall commence within 60 days after the date elected by
      the Participant on an effective distribution election
      form.  Such date elected by the Participant shall be either (1)
      the date of the Participant’s Retirement (provided, however, if the
      Participant was an Executive Officer at the time of his or her Retirement,
      the earliest commencement date (for account valuation purposes) shall be
      December 31 of the year of such Executive Officer’s Retirement) or (2) the
      first, second, third, fourth or fifth anniversary of the Participant’s
      Retirement, as selected by the
Participant.

            


    

    


    Each
Participant shall be provided the opportunity to select the form of distribution
[as set forth in paragraph (A)] and benefit commencement date [as set forth in
paragraph (B)] with regard to the amounts that are credited to the Participant's
Legacy Account Balance when the Participant first elects to participate in the
Plan.  The Participant may amend his or her distribution election with
regard to amounts that are credited to the Participant's Legacy Account Balance
at any time prior to the date that is at least twelve (12) months prior to the
Participant's Retirement by submitting a distribution election form in
accordance with the Plan’s procedures; provided that a modification to the
Participant’s distribution election with regard to amounts that are credited to
the Participant's Legacy Account Balance submitted after such 12 month period
will be effective if submitted no later than June 30, 2005, but only if the
Participant remains employed for at least ninety (90) days following the
submission of such distribution election.  If the Participant has not
submitted an effective distribution election with regard to amounts that are
credited to the Participant's Legacy Account Balance at the time of his
Retirement, the distribution of the amounts that are credited to the
Participant's Legacy Account Balance shall be in the form of a single lump sum
payment made within 60 days after the Participant's
Retirement.  Notwithstanding the preceding sentence, distribution to a
Participant who was an Executive Officer at the time of his Retirement, but who
has not submitted an effective distribution election with regard to amounts that
are credited to the Participant's Legacy Account Balance at the time of his
Retirement, shall be in the form of a single lump sum payment within 60 days
after the December 31 of the calendar year of the Participant’s
Retirement.

    


    
      	
               
      

            	
              (3)

            	
              One-Time Request for
      In-Service Withdrawal (Penalty Applies).  A Participant
      shall be entitled to receive, upon a written request to the Committee that
      is effective between April 1 and December 31 of any Plan Year, a lump sum
      distribution from his or her Legacy Account Balance of an amount equal to
      or greater than 25% of the Participant’s Legacy Account Balance as of the
      date of the request.  The date of the request shall be the date
      the Committee or the Committee’s representative receives the
      request.   The lump sum amount to be paid to the
      Participant shall be subject to a 10% early withdrawal penalty, which
      penalty shall reduce the amount to be distributed to the Participant or
      Former Participant.  The Participant or Former Participant shall
      forfeit the amount of the 10% withdrawal penalty.  The lump sum
      amount shall be paid within 60 days after the Committee receives the
      withdrawal request.  Any Participant who elects to receive a
      benefit under this paragraph shall not be considered an Eligible Employee
      with respect to the deferral election periods that apply to such
      Participant during the three year period that begins as of the date the
      amount is paid to such Participant under this Section, and such
      Participant shall not be entitled to request any additional withdrawals
      under this paragraph prior to the Participant’s termination of
      employment.  Any effective deferral elections that have already
      been submitted by such participant in accordance with Article IV shall be
      given full force and effect.

            


    

    


    (b)           Active Account
Balance.  With regard to the Participant’s Active Account
Balance the following rules shall apply:

    


    
      	
               
      

            	
              (1)

            	
              Form of
      Distribution.  The Company shall cause the Participant or
      the Former Participant to be paid the full amount credited to his or her
      Active Account Balance in accordance with his or her effective election in
      one of the following forms:

            


    

    


    
      	
               
      

            	
              (A)

            	
              A
      single lump sum distribution

            


    

    


    
      	
               
      

            	
              (i)

            	
              as
      of the First Date Available; or

            


    

    


    
      	
               
      

            	
              (ii)

            	
              as
      of the Next Date Available; or

            


    

    


    
      	
               
      

            	
              (iii)

            	
              as
      of the fifth anniversary of the First Date Available;
  or

            


    

    


    
      	
               
      

            	
              (iv)

            	
              as
      of the fifth anniversary of the Next Date Available;
  or

            


    

    


    
      	
               
      

            	
              (B)

            	
              In
      five (5) annual installments
commencing

            


    

    


    
      	
               
      

            	
              (i)

            	
              as
      of the First Date Available; or

            


    

    


    
      	
               
      

            	
              (ii)

            	
              as
      of the Next Date Available; or

            


    

    


    
      	
               
      

            	
              (iii)

            	
              as
      of the fifth anniversary of the First Date Available;
  or

            


    

    


    
      	
               
      

            	
              (iv)

            	
              as
      of the fifth anniversary of the Next Date Available;
  or

            


    

    


    
      	
               
      

            	
              (C)

            	
              In
      ten (10) annual installments
commencing.

            


    

    


    
      	
               
      

            	
              (i)

            	
              as
      of the First Date Available; or

            


    

    


    
      	
               
      

            	
              (ii)

            	
              as
      of the Next Date Available.

            


    

    


    
      	
               
      

            	
              (2)

            	
              Effective
      Election.  For this purpose, a Participant’s election
      with respect to the distribution of his or her Active Account Balance
      shall not be effective unless all of the following requirements are
      satisfied.

            


    

    


    
      	
               
      

            	
              (A)

            	
              The
      election is submitted to the Company in writing in a form determined by
      the Committee to be acceptable;

            


    

    


    
      	
               
      

            	
              (B)

            	
              The
      election is submitted timely.  For purposes of this paragraph, a
      distribution election will be considered “timely” only if it is submitted
      prior to the Participant’s Termination and it satisfies the requirements
      of (i), (ii), (iii) or (iv), below, as may be
  applicable:

            


    

    


    
      	
               
      

            	
              (i)

            	
              Submitted
      within the applicable election period set forth in Section 4.2, but only
      if the distribution election is submitted in connection with the
      Participant’s initial deferral election under this Plan;
  or

            


    

    


    
      	
               
      

            	
              (ii)

            	
              Submitted
      during the 2005 Distribution Election Period, but only with regard to the
      first distribution election form submitted by such Participant during that
      period; or

            


    

    


    
      	
               
      

            	
              (iii)

            	
              Submitted
      during the 2006 Distribution Election Period by a Participant who then has
      an Active Account Balance but who was not an Eligible Employee for
      purposes of a deferral election for 2006 by reason of the change in the
      definition of Eligible Employee set forth in Section 2.7, but only with
      regard to the last distribution election form submitted by such
      Participant during that period; or

            


    

    


    
      	
               
      

            	
              (iv)

            	
              If
      the Participant is submitting the election to change the timing or form of
      distribution that is then in effect with respect to the Participant’s
      Active Account Balance other than an effective distribution election
      submitted as part of the 2005 Distribution Election Period or 2006
      Distribution Election Period, such election must be submitted at least one
      year prior to the date of the Participant’s
  Termination.

            


    

    


    
      	
               
      

            	
              (C)

            	
              If
      the Participant is submitting the election pursuant to paragraph
      (b)(2)(B)(iv) to change the timing or form of distribution that is then in
      effect with respect to the Participant’s Active Account Balance (i.e., the
      Participant is not submitting an election with his initial deferral
      election [(B)(i)] nor during the 2005 or 2006 Distribution Election Period
      [(B)(ii) & (B)(iii)], the newly selected option must result in the
      further deferral of the first scheduled payment from the Participant’s
      Active Account balance by at least 5 years.  For purposes of
      compliance with the rule set forth in Section 409A(a) of the Code (and the
      regulations issued thereunder), each distribution option described in
      Section 6.1(b)(1) shall be treated as a single payment as of the first
      scheduled payment date. The requirement included in the prior plan
      document that the newly elected option not result in the acceleration of
      any scheduled payment under the replaced option shall be
      disregarded.

            


    

    


    
      	
               
      

            	
              (D)

            	
              If
      the Participant is submitting the election pursuant to paragraph
      (b)(2)(B)(iii) to change the timing or form of distribution that is then
      in effect with respect to the Participant’s Active Account Balance, the
      newly selected option may not defer payments that the Participant would
      have received in 2006 if not for the new distribution election nor cause
      payments to be made in 2006 if not for the new distribution
      election.

            


    

    


    
      	
               
      

            	
              (3)

            	
              If
      a Participant fails to submit an effective distribution election with
      regard to his Active Account Balance that satisfies the requirements of
      Section 6.1(b)(2)(B)(i) (with his timely initial deferral election) or
      Section 6.1(b)(2)(B)(ii) (during the 2005 Distribution Election Period) or
      Section 6.1(b)(2)(B)(iii) (during the 2006 Distribution Election Period),
      as applicable, by the date of such initial deferral election or the last
      day of the 2005 or 2006 Distribution Election Period, respectively, as
      applicable, such Participant shall be considered to have elected a
      distribution of his or her Active Account Balance in a single lump sum as
      of the First Date Available.

            


    

    


    
      	
               
      

            	
              (4)

            	
              Notwithstanding
      any other provision of this Plan to the contrary, if a Participant whose
      Termination occurs on or before June 30, 2005 fails to submit an effective
      distribution election with regard to his Active Account Balance that
      satisfies the requirements of this Section 6.1(b), the deferral election
      with respect to Contributions credited to such Participant’s Active
      Account Balance shall terminated and the entire balance of such
      Participant’s Active Account Balance shall be distributed to such
      Participant in a single lump sum as soon as administratively practicable
      after the Termination of such
Participant.

            


    

    


    6.2           (a)           For
purposes of this Article, the amount to be distributed to a Participant or
Former Participant shall be based upon the value of such individual’s Legacy
Account Balance or Active Account Balance (as applicable) determined as of the
applicable distribution date (or, if that is not a business day, then as of the
immediately preceding business day) and shall be paid to such individual as soon
as administratively practicable thereafter.

    


    (b)           Notwithstanding
any other provision of this Article,

    


    
      	
               
      

            	
              (i)

            	
              if
      the Participant’s Account is $10,000 or less on the Participant’s First
      Date Available (determined without regard to any delay by reason of a
      Participant’s being an Executive Officer), the Committee may require that
      the full value of the Participant’s Account be distributed as of the First
      Date Available (determined without regard to any delay by reason of a
      Participant’s being an Executive Officer) in a single, lump sum
      distribution regardless of the form elected by such Participant, provided
      that such payment is consistent with the limited cash-out right described
      in Treasury Regulation Section 1.409A-3(j)(4)(v) or other guidance of the
      Code in that the payment results in the termination and liquidation of the
      entirety of the Participant’s interest under each nonqualified deferred
      compensation plan (including all agreements, methods, programs, or other
      arrangements with respect to which deferrals of compensation are treated
      as having been deferred under a single nonqualified deferred compensation
      plan under Treasury Regulation 1.409A-1(c)(2) or other guidance of the
      Code) that is associated with this Plan; and the total payment with
      respect to any such single nonqualified deferred compensation plan is not
      greater than the applicable dollar amount under Code Section
      402(g)(1)(B).  Provided,
however,

            


    

    


    
      	
               
      

            	
              (ii)

            	
              Payment
      to a Participant under any provision of this Plan will be delayed at any
      time that the Committee reasonably anticipates that the making of such
      payment will violate Federal securities laws or other applicable law;
      provided however, that any payments so delayed shall be paid at the
      earliest date at which the Committee reasonably anticipates that the
      making of such payment will not cause such
  violation.

            


    

    


    6.3  If
an annual distribution is selected, the amount to be distributed in any one-year
shall be determined by dividing the Participant’s Legacy Account Balance or
Active Account Balance (as appropriate) by the number of years remaining in the
elected distribution period.   The Participant electing annual
distributions shall have the right to direct changes in the investment of the
Account in a Fund or Funds in accordance with Article V until the amount
credited to the Account is reduced to zero.

    


    


    ARTICLE
VII

    


    BENEFICIARIES

    


    7.1  Each Participant may
designate a beneficiary or beneficiaries who shall receive the balance of the
Participant's Account if the Participant dies prior to the complete distribution
of the Participant's Account.  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 form prescribed by the Committee.  A beneficiary 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
a beneficiary form is received by the Committee, any changes made on a form
received thereafter will not be given any effect.  If a Participant
fails to designate a beneficiary, or if all beneficiaries named by the
Participant do not survive the Participant, the Participant’s Account will be
paid to the Participant’s estate.  Unless clearly specified otherwise
in an applicable court order presented to the Committee prior to the
Participant’s death, the designation of a 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.

    


    7.2  Distribution
to a Participant’s beneficiary shall be in the form of a single lump-sum payment
within 60 days after the Committee makes a final determination as to the
beneficiary or beneficiaries entitled to receive such distribution.

    


    


    ARTICLE
VIII

    


    CLAIMS
PROCEDURE

    


    8.1  The following procedures
shall apply with respect to claims for benefits under the Plan.

    


    (a)           Any
Participant or Former Participant or beneficiary who believes he or she is
entitled to receive a distribution under the Plan which he or she did not
receive or that amounts credited to his or her Account are inaccurate, may file
a written claim signed by the Participant, beneficiary or authorized
representative with the Claims Reviewer, specifying the basis for the
claim.  The Claims Reviewer shall provide a claimant with written or
electronic notification of its determination on the claim within ninety days
after such claim was filed; provided, however, if the Claims Reviewer determines
special circumstances require an extension of time for processing the claim, the
claimant shall receive within the initial ninety-day period a written notice of
the extension for a period of up to ninety days from the end of the initial
ninety day period.  The extension notice shall indicate the special
circumstances requiring the extension and the date by which the Plan expects to
render the benefit determination.

    


    (b)           If
the Claims Reviewer renders an adverse benefit determination under Section
8.1(a), the notification to the claimant shall set forth, in a manner calculated
to be understood by the claimant:

    


    
      	
               
      

            	
              (1)

            	
              The
      specific reasons for the denial of the
claim;

            


    

    


    
      	
               
      

            	
              (2)

            	
              Specific
      reference to the provisions of the Plan upon which the denial of the claim
      was based;

            


    

    


    
      	
               
      

            	
              (3)

            	
              A
      description of any additional material or information necessary for the
      claimant to perfect the claim and an explanation of why such material or
      information is necessary, and

            


    

    


    
      	
               
      

            	
              (4)

            	
              An
      explanation of the review procedure specified in Section 8.2, and the time
      limits applicable to such procedures, including a statement of the
      claimant’s right to bring a civil action under section 502(a) of the
      Employee Retirement Income Security Act of 1974, as amended, following an
      adverse benefit determination on
review.

            


    

    


    8.2  The following procedures
shall apply with respect to the review on appeal of an adverse determination on
a claim for benefits under the Plan.

    


    (a)           Within
sixty days after the receipt by the claimant of an adverse benefit
determination, the claimant may appeal such denial by filing with the Committee
a written request for a review of the claim.  If such an appeal is
filed within the sixty day period, the Committee, or a duly appointed
representative of the Committee, shall conduct a full and fair review of such
claim that takes into account all comments, documents, records and other
information submitted by the claimant relating to the claim, without regard to
whether such information was submitted or considered in the initial benefit
determination.  The claimant shall be entitled to submit written
comments, documents, records and other information relating to the claim for
benefits and shall be provided, upon request and free of charge, reasonable
access to, and copies of all documents, records and other information relevant
to the claimant’s claim for benefits.  If the claimant requests a
hearing on the claim and the Committee concludes such a hearing is advisable and
schedules such a hearing, the claimant shall have the opportunity to present the
claimant’s case in person or by an authorized representative at such
hearing.

    


    (b)           The
claimant shall be notified of the Committee’s benefit determination on review
within sixty days after receipt of the claimant’s request for review, unless the
Committee determines that special circumstances require an extension of time for
processing the review.  If the Committee determines that such an
extension is required, written notice of the extension shall be furnished to the
claimant within the initial sixty-day period.  Any such extension
shall not exceed a period of sixty days from the end of the initial period. The
extension notice shall indicate the special circumstances requiring the
extension and the date by which the Committee expects to render the benefit
determination.

    


    (c)           The
Committee shall provide a claimant with written or electronic notification of
the Plan’s benefit determination on review.  The determination of the
Committee shall be final and binding on all interested parties.  Any
adverse benefit determination on review shall set forth, in a manner calculated
to be understood by the claimant:

    


    
      	
               
      

            	
              (1)

            	
              The
      specific reason(s) for the adverse
  determination;

            


    

    


    
      	
               
      

            	
              (2)

            	
              Reference
      to the specific provisions of the Plan on which the determination was
      based;

            


    

    


    
      	
               
      

            	
              (3)

            	
              A
      statement that the claimant is entitled to receive, upon request and free
      of charge, reasonable access to, and copies of, all documents, records and
      other information relevant to the claimant’s claim for benefits;
      and

            


    

    


    
      	
               
      

            	
              (4)

            	
              A
      statement of the claimant’s right to bring an action under Section 502(a)
      of ERISA.

            


    

    


    ARTICLE
IX

    


    MISCELLANEOUS
PROVISIONS

    


    9.1  Each Participant agrees
that as a condition of participation in the Plan, the Company may withhold
applicable federal, state and local taxes, Social Security taxes and Medicare
taxes from any distribution hereunder to the extent that such taxes are then
payable.

    


    9.2  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, the Committee may direct that any payment due the
Participant or the beneficiary be paid to the duly appointed personal
representative of the Participant or beneficiary, and any such payment so made
shall be a complete discharge of the liabilities of the Plan and the Company
with respect to such Participant or beneficiary.

    


    9.3  The Company intends to
continue the Plan indefinitely but reserves the right, in its sole discretion,
to modify the Plan from time to time, or to terminate the Plan entirely or to
direct the permanent discontinuance or temporary suspension of deferral
contributions under the Plan.; provided that no such modification, termination,
discontinuance or suspension shall reduce the benefits accrued for the benefit
of any Participant or beneficiary under the Plan as of the date of such
modification, termination, discontinuance or suspension.

    


    9.4  Nothing in the Plan
shall interfere with or limit in any way the right of AEP to terminate any
Participant’s employment at any time, or confer upon a Participant any right to
continue in the employ of AEP.

    


    9.5  The Company intends the
following with respect to this Plan: (1) Section 451(a) of the Code would apply
to the Participant's recognition of gross income as a result of participation
herein; (2) the Participants will not recognize gross income as a result of
participation in the Plan unless and until and then only to the extent that
distributions are received; (3) the Company will not receive a deduction for
amount credited to any Account unless and until and then only to the extent that
amounts are actually distributed; (4) the provisions of Parts 2, 3, and 4 of
Subtitle B of Title I of ERISA shall not be applicable; and (5) the design and
administration of the Plan are intended to comply with the requirements of
Section 409A of the Code, to the extent such section is effective and applicable
to amounts deferred hereunder.  However, no Eligible Employee,
Participant, Former Participant, beneficiary or any other person shall have any
recourse against the Corporation, the Company, the Committee or any of their
affiliates, employees, agents, successors, assigns or other representatives if
any of those conditions are determined not to be satisfied.

    


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

    


    9.7  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.

    


    American
Electric Power Service Corporation has caused this amendment and restatement of
the American Electric Power System Incentive Compensation Deferral Plan to be
signed as of this 31st day of December, 2008.

    


    


    


    
      
        	 
      	
                AMERICAN
      ELECTRIC POWER SERVICE CORPORATION

              
	 
      	 
      
	 
      	 
      
	 
      	
                By:  /s/
      Genevieve
      A. Tuchow 


              


      

    

    
      	
               
      

            	
              Genevieve
      A. Tuchow, Vice President, Human
Resources