01—Abstract
Summary
Summary of the 8-K filed December 19, 2025. Cited figures are marked; the original filing is the authoritative source.
American Electric Power Company, Inc. (AEP) announced on December 18, 2025, a special equity award granted to its Chair, President, and CEO, William J.
Fehrman. This award is designed as a retention strategy and to further align executive compensation with the company's performance. The initiative underscores AEP's commitment to retaining key leadership talent and incentivizing long-term value creation for shareholders.
The special award consists of two components: $10 milliona in performance shares and $5 million in restricted stock units, both vesting on December 31, 2030. The performance shares are contingent on Mr. Fehrman's continued employment through the vesting date and are tied to AEP's relative total shareholder return (rTSR) compared to a peer group over five years. The vesting of the restricted stock units is solely dependent on continued employment.
02—Key points
Key Highlights
- AEP granted a special equity award to CEO William J. Fehrman as a retention and performance alignment strategy.
- The award includes $10 million in performance shares and $5 million in restricted stock units.
- Both components of the award have a vesting date of December 31, 2030.
- Performance shares are tied to AEP's relative total shareholder return (rTSR) against a peer group over a five-year period.
- The performance metric for the shares ranges from 0% to 200% based on rTSR percentile ranking.
- Vesting for both awards is contingent upon Mr. Fehrman's continuous employment with AEP through December 31, 2030.
03—Questions
Frequently Asked Questions
What is the purpose of this special equity award to the CEO?
The special equity award to William J. Fehrman serves a dual purpose: to act as a retention incentive, ensuring continuity in leadership, and to align his compensation more closely with AEP's long-term performance as measured by total shareholder return.
What are the specific components of the CEO's special equity award?
The award comprises two main parts: $10 million in performance shares, the vesting of which depends on both continued employment and AEP's relative total shareholder return compared to its peers over five years, and $5 million in restricted stock units, which vest solely based on continued employment.
When will the CEO's special equity award vest?
Both the performance shares and the restricted stock units granted to Mr. Fehrman are scheduled to vest on December 31, 2030, provided he remains continuously employed by AEP through that date.
How is the performance of the $10 million in performance shares measured?
The vesting of the $10 million in performance shares is contingent on AEP's average relative total shareholder return (rTSR) compared to a defined peer group over the five years leading up to December 31, 2030. The number of shares that vest can range from 0% to 200% of the target award, based on AEP's rTSR performance falling between the 20th and 80th percentiles of its peer group.
04—Continue