EXHIBIT I
AIG 2009 COMPENSATION DETERMINATIONS
TECHNICAL CORRECTIONS

In Part IV.B.1.b. (on page A9) of the Initial Determination, the second sentence of the
second paragraph is restated in its entirety as follows:

“Instead, stock salary may only be redeemable in three equal, annual installments
beginning on the second anniversary of grant, with each installment redeemable one
year early if AIG repays its federal obligations.”

. In Part IV.B.3. (on page A9) of the Second Determination, footnote 4 is restated in its
entirety as follows:

“AIG has identified Covered Employees subject to expatriate arrangements providing
for the payment of certain “other” compensation in excess of this limitation. These
arrangements are designed to make the employees whole for the costs of living
overseas, at AIG’s request, in order to perform their duties. The Special Master has
reviewed these arrangements and has concluded that such payments, not to exceed
$350,000 per employee (except in exceptional cases for good cause shown), are
consistent with the Public Interest Standard, and that such payments may be
disregarded for purposes of determining whether a Covered Employee’s
compensation structure meets the requirements of the Public Interest Standard as set
forth in this Part 1V.B. In addition, the Special Master has concluded that payments
to these employees pursuant to “tax equalization agreements,” as defined in the Rule,
are consistent with the Public Interest Standard, and may be disregarded for purposes
of determining whether a Covered Employee’s compensation structure meets the
requirements of the Public Interest Standard as set forth in this Part [V.B.”

In Part IV.B.1.d. (on page A10) of the Initial Determination, a footnote is added at the
end of the last sentence of that Part, reading as follows:

“AIG has, however, identified one employee subject to an expatriate arrangement
providing for the payment of certain “other” compensation in excess of this
limitation. These arrangements are designed to make the employees whole for the
costs of living overseas, at AIG’s request, in order to perform their duties. The
Special Master has reviewed these arrangements and has concluded that such
payments, not to exceed $350,000, in addition to payments to these employees
pursuant to “tax equalization agreements,” as defined in the Rule, are consistent with
the Public Interest Standard.”


3. Additional Determinations

Following the Initial Determination, AIG requested approval to alter the terms of
the “stock salary” that may be granted to Top 25 Employees. The Initial Determination
requires that any such “stock salary” be granted in the form of stock units reflecting the
value of a “basket” of four particularly critical AIG insurance subsidiaries: American
International Assurance Co. Ltd., American Life Insurance Co., Chartis, and AIG
Domestic Life & Retirement Services Group. AIG has requested that such “stock
salary,” in appropriate cases, now be granted in the form of vested common stock (or
stock units reflecting the value of common stock) of AIG rather than the “basket.”

The Special Master has reviewed this request in light of the principles set forth in
the Rule. In particular, the Special Master’s review has been guided by the principle that
compensation structures should be “performance-based over a relevant performance
period.” Jd. § 30.16(b)(1)(iv). Providing Top 25 Employees with stock salary in the
form of common stock will provide those employees with incentives to maximize the
value of AIG and, therefore, its ability to repay the taxpayer. Accordingly, the Special
Master has determined that, for purposes of the Initial Determination, “stock salary” may
include vested common stock (or stock units reflecting the value of common stock) of
AIG, and that compensation structures for Top 25 Employees pursuant to the foregoing
will not, by virtue of their structural design or the amounts potentially payable
thereunder, result in payments inconsistent with the Public Interest Standard.

The conclusions reached herein are limited to the authority vested in me by
Section 30.16(a)(3) of the Rule, and shall not constitute, or be construed to constitute, the
judgment of the Office of the Special Master or the Department of the Treasury with
respect to the compliance of the proposed compensation structure or any other
compensation structure for the subject employee with any other provision of the Rule.
Moreover, my evaluation and conclusions have relied upon, and are qualified in their
entirety by, the accuracy of the materials submitted by AIG to the Office of the Special
Master, including without limitation the Reconsideration Request, and the absence of any
material misstatement or omission in such materials.

Very truly a cf
Kestneth R. Feinberg

Office of the Special Master
for TARP Executive Compensation

ce: Anastasia D. Kelly, Esquire
Marc R. Trevino, Esquire


DEPARTMENT OF THE TREASURY
WASHINGTON, D.C. 20220

December 21, 2009

Mr. Robert Benmosche

President and Chief Executive Officer
American International Group, Inc.
70 Pine Street

27th Floor

New York, NY 10270

Re: — Reconsideration Request and Supplemental Determination Regarding
2009 Compensation Payments and Structures for Senior Executive
Officers and Most Highly Compensated Employees

Dear Mr. Benmosche:

Pursuant to the Department of the Treasury’s Interim Final Rule on TARP
Standards for Compensation and Corporate Governance (the “Rule”), on October 22,
2009, the Special Master issued an initial determination (the “Initial Determination”) with
respect to compensation payments for the senior executive officers and next 20 most
highly compensated employees (“Top 25 Employees”) of American International Group,
Inc. (“AIG”). 31 C.F.R. § 30.16(a)(3)(i). Under the Rule, AIG is permitted, within 30
days of the issuance of the Initial Determination, to request that the Special Master
reconsider that determination, provided that the request specified relevant new
information not previously considered by the Special Master. See id. § 30.16(c)(1).

On November 20, 2009, AIG submitted a written request for reconsideration (the
“Reconsideration Request”) of the Initial Ruling with respect to one Top 25 Employee.
AIG’s prior submissions to the Office of the Special Master indicated that the Top 25
Employee would terminate employment with AIG during 2009, and the Initial
Determination with respect to the Top 25 Employee reflected those submissions. The
Reconsideration Request indicated, however, that the Top 25 Employee will remain in
the employ of AIG. In light of that information, which was not previously considered by
the Special Master, AIG requested that the Special Master reconsider the compensation
payments approved in the Initial Determination for the Top 25 Employee.

Under the Rule, the Special Master must, upon receipt of a written request for
reconsideration, provide a final determination setting forth the facts and analysis that
formed the basis for the determination. /d. This letter sets forth the final determination
of the Special Master in light of AIG’s Reconsideration Request. In addition, this letter
addresses certain other matters, including, as set forth below, certain technical corrections
to the Initial Determination and to the Special Master's December 11, 2009 determination
with respect to compensation structures for certain employees (“Covered Employees 26 ~
100) not subject to the Initial Determination (the “Second Determination”).


1. Reconsideration Request

AIG’s previous submissions to the Office of the Special Master indicated that a
specified Top 25 Employee (the “Specified Employee”) intended to depart AIG prior to
the end of 2009. Based on that information, the Special Master’s Initial Determination
approved compensation for the Specified Employee limited to a base salary of $450,000,
payable through the Specified Employee's departure date, and no further compensation
for the remainder of 2009.

AIG’s Reconsideration Request states that, rather than depart AIG prior to the end
of 2009, the Specified Employee will remain in the employ of AIG. AIG has indicated
that the employee is critical to AIG’s long-term performance and stability, and that his
continued employment by AIG will significantly aid AIG’s ability to repay the taxpayer.
In light of those facts, AIG’s Reconsideration Request seeks approval of two additional
types of compensation for the Specified Employee for 2009: (1) a nunc pro tunc grant of
stock salary, with a grant-date value of $3,258,333, and (2) an annual long-term incentive
award, in an amount up to $1,000,000 depending on the Specified Employee’s
achievement of objective performance metrics, to be granted in the form of “long-term
restricted stock” as defined in the Rule (the “Proposed Structure”).

The Rule requires that the Special Master determine for each Top 25 Employee
whether the proposed compensation structure, including amounts payable or potentially
payable under the compensation structure, “will or may result in payments that are
inconsistent with the purposes of [S]ection 111 of EESA or TARP, or [is] otherwise
contrary to the public interest.” 31 C.F.R. § 30.16(a)(3) (the “Public Interest Standard”).
The Rule requires that the Special Master consider six principles when making these
compensation determinations. Jd. § 30.16(b)(1).

The Special Master has reviewed the Reconsideration Request in detail by
application of the principles set forth in the Rule. In particular, the Special Master’s
review has been guided by the principle that compensation structures should be
“performance-based over a relevant performance period.” /d. § 30.16(b)(1)(iv). The
Initial Determination authorized no stock salary or annual long-term incentive award for
the Specified Employee because AIG’s submissions indicated that the Specified
Employee would depart AIG. Under those circumstances, no performance-based pay
was necessary to align the interests of the Specified Employee with those of AIG and
taxpayers. However, in light of the fact that the Specified Employee will remain in the
employ of AIG, it is appropriate to provide the Specified Employee with long-term
incentives to ensure that the employee contributes to AIG’s long-term success and,
ultimately, AIG’s ability to repay taxpayers.

Accordingly, the Special Master has determined that, in addition to the
compensation approved for the Specified Employee in the Initial Determination, the
Proposed Structure will not, by virtue of its structural design or the amounts potentially
payable thereunder, result in payments inconsistent with the Public Interest Standard, In
all other respects, the compensation structure for the Specified Employee must comply


with the terms of the Initial Determination, including requirements related to the
transferability of salary stock and the grant of long-term incentives.

In addition, the Specified Employee shall remain subject to the requirement that
“other” compensation and perquisites not exceed $25,000, except where a satisfactory
independent justification is provided in formal submissions to the Office of the Special
Master. To date, no satisfactory justification with respect to the Specified Employee has
been provided to the Office of the Special Master. Accordingly, to the extent that the
“other” compensation and perquisites in excess of $25,000 described in AIG’s
submissions have been provided to the Specified Employee during 2009, in order to be
consistent with the Public Interest Standard the compensation structure must provide for
the reduction of amounts payable to the Specified Employee by any such excess, and
such reduction may be subject to further review by the Office of the Special Master.

2. Technical Corrections

The Initial Determination requires that stock salary granted to Top 25 Employees
may only be redeemed by the employee in three equal, annual installments beginning on
the second anniversary of grant, with each installment redeemable one year early if AIG
repays its TARP obligations. The determinations were intended to accelerate the sale of
stock salary only if AIG repays its obligations to taxpayers. AIG’s obligations, however,
include both TARP obligations and obligations to other federal institutions. Thus, the
Second Determination requires that stock salary granted to Covered Employees 26 — 100
may only be redeemed by the employee in three equal, annual installments beginning on
the second anniversary of grant, with each installment redeemable one year early if AIG
repays its federal obligations. Accordingly, Exhibit I sets forth corrections to the Initial
Determination that bring the requirements of the Initial Determination with respect to
salary stock into conformity with the requirements of the Second Determination.

The Second Determination included the determinations of the Special Master with
respect to amounts payable to Covered Employees 26 — 100 pursuant to certain expatriate
arrangements. These arrangements are designed to make the employees whole for the
costs of living overseas, at AIG’s request, in order to perform their duties. Those
determinations were intended also to address payments pursuant to “tax equalization
agreements,” as defined in the Rule; however, the Second Determination did not
expressly address those arrangements. Accordingly, Exhibit I sets forth corrections to
the Second Determination that clarify the determinations of the Special Master.

In addition, upon further review of AIG’s submissions, it has come to the
attention of the Office of the Special Master that one Top 25 Employee is also subject to
expatriate arrangements. These arrangements were not expressly addressed in the Initial
Determination. Accordingly, Exhibit I sets forth corrections to the Initial Determination
that address payments pursuant to expatriate arrangements for that Top 25 Employee.