AMERICAN INTERNATIONAL GROUP, INC. ("AIG")

FIXED RATE CUMULATIVE PERPETUAL PREFERRED

STOCK OFFERING

CLOSING DATE: NOVEMBER 25, 2008

I. Securities Purchase Agreement and Related Documents

Securities Purchase Agreement, including Schedules and Annexes

thereto 1

Series D Preferred Stock Certificate of Designations (including proof of

Delaware filing) 2

Series D Preferred Stock Certificate 3

Warrant to purchase shares of common stock issued to the U.S.

Department ofthe Treasury, dated as of November 25, 2008 4

II. Certificates and Other Deliveries

Officer's Certificate of AIG related to Representations and Warranties,

dated November 25, 2008 5

Officer's Certificate of AIG related to Executive Compensation, dated

November 25, 2008 6

Opinion of Sullivan & Cromwell, dated November 25,2008 7

Secretary's Certificate ofAIG, dated as of

November 25, 2008 8

Long Form Certificate of Good Standing ofAIG from

Delaware, dated November 25, 2008 9

III. Resolutions

Board Resolutions ofAIG, dated as of November 9,2008 10
Board Resolutions ofAIG, dated as of November 19, 2008 11

IV. Transfer Agent

Secretary's Certificate ofAIG, dated November 25,2008 12

Letter of Instruction sent by AIG to Wells Fargo Bank, N.A., dated

November 25, ~008 13

Reliance letter delivered to Wells Fargo Bank, N.A.,

dated November 25, 2008 14

Opinion ofAIG delivered to Wells Fargo Bank, N.A.,

dated November 25, 2008 15

Officer's Certificate ofWells Fargo Bank delivered to AIG

dated November 25,2008 16

v. Regulatory Filings ofAlG

Current Report on Form 8-K, dated November 26,2008 17

VI. NYSE Supplemental Listing Application 18

VII. Consents andWaivers from the Company, Senior Executive

Officers and Senior Partners 19

2


SECURITIES PURCHASE AGREEMENT

dated as of

November 25,2008

between

American International Group, Inc.

and

United States Department of the Treasury

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TABLE OF CONTENTS

ARTlCLEl

PuRCHASE; CLOSING

1.1 Purchase 1

1.2 Closing 1

1.3 Interpretation 4

ARTICLE 2

REPRESENTATIONS AND WARRANTIES

2.1 Disclosure 4

2.2 Representations and Warranties ofthe Company 5

ARTICLE 3

COVENANTS

3.1 Consummation ofPurchase and Chaner Amendment 13

3.2 Expenses 15

3.3 Sufficiency ofAuthorized Common Stock; Exchange Listing 15

3.4 Cenain Notifications Until Closing 15

3.5 Information and Confidentiality 15

ARTICLE 4

ADDITIONAL AGREEMENTS

4.1 Purchase ofRestricted Securities 16

4.2 Legends 16

4.3 Cenain Transactions 18

4.4 Transfer ofPurchased Securities, the Warrant and Warrant Shares 18

4.5 Registration Rights 18

4.6 Voting ofWarrant Shares 30

4.7 Depositary Shares 30

4.8 Restriction on Dividends and Repurchases 30

4.9 Repurchase ofInvestor Securities 31

4.10 Executive Compensation 33

4.11 Restrictions on Lobbying 35

4.12 Restrictions on Expenses 35

4.13 Risk Management Committee 36

4.14 Dividend Rate Adjustment 36

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ARTICLE 5

MISCELLANEOUS

5.1 Termination 36

5.2 Survival ofRepresentations and Warranties 36

5.3 Amendment 37

5.4 Waiver ofConditions 37

5.5 Governing Law: Submission to Jurisdiction, Etc 37

5.6 Notices 37

5.7 Definitions 38

5.8 Assignment 39

5.9 Severability 39

5.10 Entire Agreement 39

5.11 No Third Party Beneficiaries 39

SCHEDULE A:

SCHEDULEB:

SCHEDULEC:

SCHEDULED:

SCHEDULEE:

LIST OF ANNEXES

ADDITIONAL TERMS AND CONDITIONS

CAPITALIZATION

LITIGATION

COMPLIANCE WITH LAWS

REGULATORY AGREEMENTS

ANNEX A: FORM OF CERTIFICATE OF DESIGNATIONS FOR PREFERRED

STOCK

ANNEX B-1: FORM OF WAIVER FOR THESENIOR EXECUTIVE OFFICERS AND

THE SENIOR PARTNERS

ANNEX B-2: FORM OF WAIVER FOR THE COMPANY

ANNEX C: FORM OF OPINION

ANNEX D: FORM OF WARRANT

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INDEX OF DEFINED TERMS

Term

Affiliate

Agreement

Appraisal Procedure

Bankruptcy Exceptions

Benefit Plans

Board of Directors

Business Combination

business day

Capitalization Date

Certificate of Designations

Charter

Closing

Closing Date

Code

Common Stock

Company

Company Financial Statements

Company Material Adverse Effect

Company Reports

Company Subsidiary; Company Subsidiaries

Control

control; controlled by; under common control with

Controlled Group

Credit Agreement

EESA

Equity Interests

ERISA

Exchange Act

Fair Market Value

FRBNY

Fund

GAAP

Governmental Entities

Holder

Holders' Counsel

Indemnitee

Information

Investor

Junior Stock

knowledge of the Company; Company's knowledge

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Location of

Definition

5.7(b)

Recitals

4.9(c)(i)

2.2(d)

t.2(d)(iv)

2.2(f)

5.8

1.3

2.2(b)

t.2(d)(iii)

2.2(a)

1.2(a)

t.2(a)

2.2(n)

2.1

Recitals

2.2(h)

2.1 (a)

2.2(i)(i)

2.2(i)(i)

4.9(c)(iii)

5.7(b)

2.2(n)

1.2(b)

t.2(d)(iv)

5.7(b)

2.2(n)

2.1 (b)

4.9(c)(ii)

1.2(b)

5.7(b)

2.1 (a)

1.2(c)

4.5(k)(i)

4.5(k)(ii)

4.5{g)(i)

3.5(b)

Recitals

4.8(c)

5.7(c)
Tenn

Last Fiscal Year

officers

Parity Stock

Pending Underwritten Offering

Pennitted Repurchases

Piggyback Registration

Plan

Preferred Stock

Previously Disclosed

Proprietary Rights

Purchase

Purchase Price

Purchased Securities

register~ registered; registration

Registrable Securities

Registration Expenses

Regulatory Agreement

Rule 144; Rule 144A~ Rule 159A; Rule 405~ Rule 415

SEC

Securities Act

Selling Expenses

Senior Executive Officers

Senior Partners

Series C Preferred Stock

Share Dilution Amount

Shelf Registration Statement

Signing Date

Special Registration

Stockholder Proposal

subsidiary

Tax; Taxes

Transfer

Warrant

Warrant Shares

IV

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Location of

Definition

2.1(b)

5.7(c)

4.8(c)

4.5(1)

4.8(a)(ii)

4.5(a)(iv)

2.2(n)

Recitals

2.1 (b)

2.2(u)

Recitals

1.1

Recitals

4.5(k)(iii)

4.5(k)(iv)

4.5(k)(v)

2.2(s)

4.5(k)(vi)

2.1 (b)

2.2(a)

4.5(k)(vii)

4.10

4.10

2.2(b)

4.8(a)(ii)

4.5(a)(ii)

2.1 (a)

4.5(i)

3.1(b)

5.7(a)

2.2(0)

4.4

Recitals

2.2(d)
SECURITIES PURCHASE AGREEMENT

Recitals:

WHEREAS, American International Group, Inc. (the "Company") intends to issue in a

private placement 4,000,000 shares of the Series D Fixed Rate Cumulative Perpetual Preferred

Stock (the "Preferred Stock") and a warrant (the "Warrant", and together with the Preferred

Stock, the "Purchased Securities") to purchase 53,798,766 shares ofthe Company's common

stock and the United States Department ofthe Treasury (the "Investor") intends to purchase (the

"Purchase") from the Company the Purchased Securities; and

WHEREAS, the Purchase will be governed by this Securities Purchase Agreement

(including the Schedules and Annexes hereto) (the "Agreement").

NOW, THEREFORE, in consideration of the premises, and of the representations,

warranties, covenants and agreements set forth herein, the parties agree as follows:

Article 1

Purchase; Closing

1.1 Purchase. On the terms and subject to the conditions set forth in this Agreement,

the Company agrees to sell to the Investor, and the Investor agrees to purchase from the

Company, at the Closing (as hereinafter defined), the Purchased Securities for $40,000,000,000

(the "Purchase Price").

1.2 Closing.

(a) On the terms and subject to the conditions set forth in this Agreement, the closing

of the Purchase (the "Closing") will take place at the location specified in Schedule A, at the

time and on the date set forth in Schedule A, or as soon as practicable thereafter, or at such other

place, time and date as shall be agreed between the Company and the Investor. The time and date

on which the Closing occurs is referred to in this Agreement as the "Closing Date".

(b) Subject to the fulfillment or waiver of the conditions to the Closing in this Section

1.2, at the Closing (i) the Company will deliver the Preferred Stock and the Warrant, in each case

as evidenced by one or more certificates dated the Closing Date and bearing appropriate legends

as hereinafter provided for, (ii) upon verification of receipt of the Preferred Stock and Warrant at

the Investor's custodian, the Investor shall pay the Purchase Price by instructing the Federal

Reserve Bank of New York (the "FRBNY'), acting as fiscal agent of the Investor, to debit the

Investor's General Account for the Purchase Price, and the Investor is hereby directed by the

Company to pay the Purchase Price directly to the FRBNY as a credit to the account on the

books ofthe FRBNY evidencing a prepayment in the amount of the Purchase Price of the

Company's indebtedness to the FRBNY under the Credit Agreement dated as of September 22,

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2008 between the Company and the FRBNY, as amended from time to time (the "Credit

Agreement").

(c) The respective obligations of each of the Investor and the Company to consummate

the Purchase are subject to the fulfillment (or waiver by the Investor and the Company, as

applicable) prior to the Closing of the conditions that (i) any approvals or authorizations of all

United States and other governmental, regulatory orjudicial authorities (collectively,

"Governmental Entities") required for the consummation of the Purchase shall have been

obtained or made in form and substance reasonably satisfactory to each party and shall be in full

force and effect and all waiting periods required by United States and other applicable law, if any,

shall have expired and (ii) no provision of any applicable United States or other law and no

judgment, injunction, order or decree of any Governmental Entity shall prohibit the purchase and

sale of the Purchased Securities as contemplated by this Agreement.

(d) The obligation of the Investor to consummate the Purchase is also subject to the

fulfillment (or waiver by the Investor) at or prior to the Closing of each ofthe following

conditions:

(i) (A) the representations and warranties of the Company set forth in (x)

Section 2.2(g) of this Agreement shall be true and correct in all respects as though made

on and as of the Closing Date, (y) Sections 2.2(a) through (f) shall be true and correct in

all material respects as though made on and as of the Closing Date (other than

representations and warranties that by their terms speak as of another date, which

representations and warranties shall be true and correct in all material respects as of such

other date) and (z) Sections 2.2(h) through (v) (disregarding all qualifications or

limitations set forth in such representations and warranties as to "materiality",

"Company Material Adverse Effect" and words of similar import) shall be true and

correct as though made on and as of the Closing Date (other than representations and

warranties that by their terms speak as of another date, which representations and

warranties shall be true and correct as ofsuch other date), except to the extent that the

failure of such representations and warranties refen'ed to in this Section 1.2(d)(i)(A)(z) to

be so true and correct, individually or in the aggregate, does not have and would not

reasonably be expected to have a Company Material Adverse Effect and (B) the

Company shall have performed in all material respects all obligationsrequired to be

performed by it under this Agreement at or prior to the Closing;

(ii) the Investor shall have received a certificate signed on behalf of the

Company by a senior executive officer certifying to the effect that the conditions set forth

in Section 1.2(d)(i) have been satisfied;

(iii) the Company shall have duly adopted and filed with the Secretary of State

of its jurisdiction of organization or other applicable Governmental Entity the certificate

of designations for the Preferred Stock in substantially the form attached hereto as Annex

A (the "Certificate of Designations") and such filing shall have been accepted;

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(iv) (A) the Company shall have taken all necessary action to effect such

changes to its compensation, bonus, incentive and other benefit plans, arrangements and

agreements (including golden parachute, severance and employment agreements)

(collectively, "Benefit Plans") with respect to the Senior Executive Officers (and to the

. extent necessary for such changes to be legally enforceable, each of the Senior Executive

Officers shall have duly consented in writing to such changes), as may be necessary,

during the period that the Investor owns any debt or equity securities of the Company

acquired pursuant to this Agreement or the Warrant, in order to comply with Section

111(b) of the Emergency Economic Stabilization Act of 2008 ("EESA"), including the

provisions for Systemically Significant Failing Institutions, as implemented by guidance

or regulation thereunder, including Notice 2008-PSSFI, that has been issued and is in

effect as of the Closing Date, including provisions prohibiting severance payments to the

Senior Executive Officers, (B) the Company shall have taken all necessary action to

effect such changes to its Benefit Plans with respect to the U.S.-based Senior Partners

(and to the extent necessary for such changes to be legally enforceable, each of the U.S.-

based Senior Partners shall have duly consented in writing to such changes), as may be

necessary, during the period that the Investor owns any debt or equity securities of the

Company acquired pursuant to this Agreement or the Warrant, in order to comply with

the requirements in Section 4.1 0 of this Agreement, (C) the Company shall have used its

best efforts to take all necessary action to effect such changes to its Benefit Plans with

respect to the other Senior Partners (and to the extent necessary for such changes to be

legally enforceable, to have each of the other Senior Partners duly consent in writing to

such changes), as may be necessary, during the period that the Investor owns any debt or

equity securities of the Company acquired pursuant to this Agreement or the Warrant, in

order to comply with the requirements in Section 4.10 ofthis Agreement and (D) the

Investor shall have received a certificate signed on behalf of the Company by a senior

executive officer certifying to the effect that the conditions set forth in Section

1.2(d)(iv)(A) and (B) have been satisfied;

(v) each of the Company's Senior Executive Officers and the U.S-based

Senior Partners shall have delivered to the Investor, and the Company shall have

delivered to the Investor, a written waiver in the form attached hereto as Annex B-1 (for

the Senior Executive Officers and Senior Partners) or Annex B-2 (for the Company)

releasing the Investor and the Company, and in the case of the Company's waiver,

releasing the Investor, from any claims that such Senior Executive Officers or Senior

Partners may otherwise have against the Company or the Investor, and in the case of the

Company, any claims it may have against the Investor, in each case as a result of the

issuance, on or prior to the Closing Date, of any such guidance or regulations or as a

result ofthe requirements in Section 4.10 of this Agreement which require the

modification of, and the agreement of the Company hereunder to modify, the terms of

any Benefit Plans with respect to the Senior Executive Officers and, as applicable, with

respect to the Senior Partners to eliminate or modify any provisions ofsuch Benefit Plans

that would not be in compliance with the requirements of Section 111(b) of the EESA,

including the provisions for Systemically Significant Failing Institutions, as implemented

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by guidance or regulation thereunder, including Notice 2008-PSSFI, that has been issued

and is in effect as of the Closing Date, and the requirements in Section 4.10 of this

Agreement;

(vi) the Company shall have delivered to the Investor a written opinion from

counsel to the Company (which may be internal counsel), addressed to the Investor and

dated as of the Closing Date, in substantially the form attached hereto as Annex C;

(vii) the Company shall have delivered certificates in proper fonn or, with the

prior consent of the Investor, evidence of shares in book-entry form, evidencing the

Preferred Stock to the Investor or its designee(s); and

(viii) the Company shall have duly executed the Warrant in substantially the

fonn attached hereto as Annex D and delivered such executed Warrant to the Investor or

its designee(s).

1.3 Interpretation. When a reference is made in this Agreement to "Recitals,"

"Articles," "Sections," "Annexes" or "Schedules" such reference shall be to a Recital, Article or

Section of, or Annex or Schedule to, this Agreement. The tenns defined in the singular have a

comparable meaning when used in the plural, and vice versa. References to "herein", "hereof',

"hereunder" and the like refer to this Agreement as a whole and not to any particular section or

provision, unless the context requires otherwise. The table of contents and headings contained in

this Agreement are for reference purposes only and are not part of this Agreement. Whenever the

words "include," "includes" or "including" are used in this Agreement, they shall be deemed

followed by the words "without limitation." No rule of construction against the draftsperson shall

be applied in connection with the interpretation or enforcement of this Agreement, as this

Agreement is the product of negotiation between sophisticated parties advised by counsel. All

references to "$" or "dollars" mean the lawful currency of the United States of America. Except

as expressly stated in this Agreement, all references to any statute, rule or regulation are to the

statute, rule or regulation as amended, modified, supplemented or replaced from time to time

(and, in the case of statutes, include any rules and regulations promulgated under the statute) and

to any section of any statute, rule or regulation include any successor to the section. References

to a "business day~' shall mean any day except Saturday, Sunday and any day on which banking

institutions in the State of New York generally are authorized or required by law or other

governmental actions to close.

Article 2

Representations and Warranties

2.1 Disclosure.

(a) "Company Material Adverse Effect" means a material adverse effect on (i) the

business, results of operation or financial condition of the Company and its consolidated

subsidiaries taken as a whole; provided, however, that Company Matelial Adverse Effect shall

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not be deemed to include the effects of (A) changes after the date of this Agreement (the

"Signing Date") in general business, economic or market conditions (including changes

generally in prevailing interest rates, credit availability and liquidity, currency exchange rates

and price levels or trading volumes in the United States or foreign securities or credit markets),

or any outbreak or escalation of hostilities, declared or undeclared acts of war or terrorism, in

each case generally affecting the industries in which the Company and its subsidiaries operate,

(B) changes or proposed changes after the Signing Date in generally accepted accounting

principles in the United States ("GAAP") or regulatory accounting requirements, or authoritative

interpretations thereof, (C) changes or proposed changes after the Signing Date in securities,

insurance and other laws of general applicability or related policies or interpretations of

Governmental Entities (in the case of each of these clauses (A), (B) and (C), other than changes

or occurrences to the extent that such changes or occurrences have or would reasonably be

expected to have a materially disproportionate adverse effect on the Company and its

consolidated subsidiaries taken as a whole relative to comparable U.S. insurance or financial

services organizations), or (D) changes in the market price or trading volume of the Company's

common stock, par value $2.50 per share ("Common Stock"), or any other equity, equity-related

or debt securities of the Company or its consolidated subsidiaries (it being understood and agreed

that the exception set forth in this clause (D) does not apply to the underlying reason giving rise

to or contributing to any such change)~ or (ii) the ability of the Company to consummate the

Purchase and the other transactions contemplated by this Agreement and the Warrant and

perform its obligations hereunder or thereunder on a timely basis.

(b) "Previously Disclosed" means information set forth or incorporated in the

Company's Annual Report on Form 10-K for the most recently completed fiscal year of the

Company filed with the Securities and Exchange Commission (the "SEC") prior to the Signing

Date (the "Last Fiscal Year") or in its other reports and forms filed with or furnished to the SEC

under Sections 13(a), 14(a) or 15(d) ofthe Securities Exchange Act of 1934 (the "Exchange

Act") on or after the last day of the Last Fiscal Year and prior to the Signing Date.

2.2 Representations and Warranties ofthe Company. Except as Previously Disclosed,

the Company represents and warrants to the Investor that as of the Signing Date and as of the

Closing Date (or such other date specified herein):

(a) Organization, Authority and Significant Subsidiaries. The Company has been duly

incorporated and is validly existing and in good standing under the laws of its jurisdiction of

organization, with the necessary power and authority to own its properties and conduct its

business in all material respects as currently conducted; except as has not had, individually or in

the aggregate, and would not reasonably be expected to have a Company Material Adverse

Effect, the Company has been duly qualified as a foreign corporation for the transaction of

business and is in good standing under the laws of each otherjurisdiction in which it owns or

leases properties or conducts any business so as to require such qualification; each subsidiary of

the Company that is a "significant subsidiary" within the meaning ofRule 1-02(w) of

Regulation S-X under the Securities Act of 1933 (the "Securities Act") has been duly organized

and is validly existing in good standing under the laws of its jurisdiction of organization. The

Restated Certificate of Incorporation of the Company, as amended (the "Charter") and bylaws

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of the Company, copies of which have been provided to the Investor prior to the Signing Date,

are true, complete and correct copies of such documents as in full force and effect as ofthe

Signing Date.

(b) Capitalization. The authorized capital stock of the Company, and the outstanding

capital stock ofthe Company (including securities convertible into, or exercisable or

exchangeable for, capital stock of the Company) as of the most recent fiscal month-end

preceding the Signing Date (the "Capitalization Date") is set forth on Schedule B. The

outstanding shares of capital stock of the Company have been duly authorized and are validly

issued and outstanding, fully paid and nonassessable, and subject to no preemptive rights (and

were not issued in violation of any preemptive rights). As of the Signing Date, the Company

does not have outstanding any securities or other obligations providing the holder the right to

acquire Common Stock that is not reserved for issuance, and the Company has not made any

other commitment to authorize, issue or sell any Common Stock, except as specified on Schedule

and including the Series C Perpetual, Convertible, Participating Preferred Stock, par value

$5.00 per share (the "Series C Preferred Stock"). Since the Capitalization Date, the Company

has not issued any shares of Common Stock, other than (i) shares issued upon the exercise of

stock options or delivered under other equity-based awards or other convertible securities or

warrants which were issued and outstanding on the Capitalization Date and disclosed on

Schedule Band (ii) shares disclosed on Schedule B.

(c) Preferred Stock. The Preferred Stock has been duly and validly authorized, and,

when issued and delivered pursuant to this Agreement, such Preferred Stock will be duly and

validly issued and fully paid and non-assessable, will not be issued in violation of any

preemptive rights, and will rank pari passu with all other series or classes of the Company's

preferred stock, whether or not issued or outstanding, with respect to the payment of dividends

and the distribution of assets in the event of any dissolution, liquidation or winding up of the

Company.

Cd) The Warrant and Warrant Shares. The Warrant has been duly authorized and, when

executed and delivered as contemplated hereby, will constitute a valid and legally binding

obligation of the Company enforceable against the Company in accordance with its terms, except

as the same may be limited by applicable baDkruptcy, insolvency, reorganization, moratorium or

similar laws affecting the enforcement of creditors' rights generally and general equitable

principles, regardless of whether such enforceability is considered in a proceeding at law or in

equity ("Bankruptcy Exceptions"). The shares of Common Stock issuable upon exercise of the

Warrant (the "Warrant Shares") have been duly authorized and reserved for issuance upon

exercise of the Warrant and when so issued in accordance with the terms of the Warrant will be

validly issued, fully paid and non-assessable.

(e) Authorization, Enforceability.

(i) The Company has the corporate power and authority to execute and

deliver this Agreement and the Warrant and, subject to the approval of its stockholders

described in Section 3.1(b), to carry out its obligations hereunder and thereunder (which

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includes the issuance of the Preferred Stock, Warrant, and Warrant Shares). The

execution, delivery and perfonnance by the Company of this Agreement and the Warrant

and the consummation of the transactions contemplated hereby and thereby have been

duly authorized by all necessary corporate action on the part of the Company and its

stockholders, and no further approval or authorization is required on the part of the

Company or its stockholders, except as described in Section 3.1 (b). This Agreement is a

valid and binding obIigation of the Company enforceable against the Company in

accordance with its tenns, subject to the Bankruptcy Exceptions.

(ii) The execution, delivery and perfonnance by the Company of this

Agreement and the Warrant and the consummation of the transactions contemplated

hereby and thereby and compliance by the Company with the provisions hereof and

thereof, will not (A) violate, conflict with, or result in a breach of any provision of, or

constitute a default (or an event which. with notice or lapse of time or both, would

constitute a default) under, or result in the termination of, or accelerate the perfonnance

required by, or result in a right of termination or acceleration of, or result in the creation

of. any lien, security interest, charge or encumbrance upon any ofthe properties or assets

of the Company or any Company Subsidiary under any of the tenns, conditions or

provisions of (i) subject to the approval of the Company's stockholders as described in

Section 3.1 (b), its organizational documents or (ii) any note, bond, mortgage, indenture,

deed of trust, license, lease, agreement or other instrument or obligation to which the

Company or any Company Subsidiary is a party or by which it or any Company

Subsidiary may be bound, or to which the Company or any Company Subsidiary or any

ofthe properties or assets ofthe Company or any Company Subsidiary may be subject, or

(B) subject to compliance with the statutes and regulations referred to in the next

paragraph, violate any statute. rule or regulation or any judgment, ruling, order, writ,

injunction or decree applicable to the Company or any Company Subsidiary or any of

their respective properties or assets except, in the case of clauses (A)(ii) and (B), for

those occurrences that, individually or in the aggregate, have not had and would not

reasonably be expected to have a Company Material Adverse Effect.

(iii) Other than the filing of the Certificate of Designations with the Secretary

of State of its jurisdiction of organization or other applicable Governmental Entity. any

current report on Form 8-K required to be filed with the SEC, such filings and approvals

as are required to be made or obtained under any state "blue sky" laws, the filing of any

proxy statement contemplated by Section 3.1(b) and such as have been made or obtained,

no notice to, filing with, exemption or review by. or authorization, consent or approval of.

any Governmental Entity is required to be made or obtained by the Company in

connection with the consummation by the Company of the Purchase except for any such

notices, filings, exemptions, reviews, authorizations. consents and approvals the failure of

which to make or obtain would not, individually or in the aggregate. reasonably be

expected to have a Company Material Adverse Effect.

(f) Anti-takeover Provisions and Rights Plan. The Board of Directors of the Company

(the "Board of Directors") has taken all necessary action to ensure that the transactions

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contemplated by this Agreement and the Warrant and the consummation of the transactions

contemplated hereby and thereby, including the exercise of the Warrant in accordance with its

terms, will be exempt from any anti-takeover or similar provisions of the Company's Charter and

bylaws, and any other provisions of any applicable "moratorium", "control share", "fair price",

"interested stockholder" or other anti-takeover laws and regulations of any jurisdiction. The

Company has taken all actions necessary to render any stockholders' rights plan of the Company

inapplicable to this Agreement and the Warrant and the consummation of the transactions

contemplated hereby and thereby, including the exercise of the Warrant by the Investor in

accordance with its terms.

(g) No Company Material Adverse Effect. Since the last day of the last completed

fiscal period for which the Company has filed a Quarterly Report on Form 10-Q or an Annual

Report on Form 10-K with the SEC prior to the Signing Date, no fact, circumstance, event,

change, occurrence, condition or development has occurred that, individually or in the aggregate,

has had or would reasonably be expected to have a Company Material Adverse Effect.

(h) Company Financial Statements. The financial statements of the Company and its

consolidated subsidiaries (collectively, the "Company Financial Statements") included or

incorporated by reference in the Company Reports filed with the SEC since December 31, 2006,

present fairly in all material respects the consolidated financial position of the Company and its

consolidated subsidiaries as of the dates indicated therein (or if amended prior to the Signing

Date, as of the date of such amendment) and the consolidated results of their operations for the

periods specified therein; and except as stated therein, such financial statements (A) were

prepared in conformity with GAAP applied on a consistent basis (except as may be noted

therein), (B) have been prepared from, and are in accordance with, the books and records of the

Company and the Company Subsidiaries and (C) complied as to form, as of their respective dates

of filing with the SEC, in all material respects with the applicable accounting requirements and

with the published rules and regulations ofthe SEC with respect thereto.

(i) Reports.

(i) Since December 31, 2006, the Company and each subsidiary of the

Company (each a "Company Subsidiary" and, collectively, the "Company

Subsidiaries") has timely filed (subject to any permitted extension) all reports,

registrations, documents, filings, statements and submissions, together with any

amendments thereto, that it was required to file with any Governmental Entity (the

foregoing, collectively, the "Company Reports") and has paid all fees and assessments

due and payable in connection therewith, except, in each case, as would not, individually

or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

As oftheir respective dates of filing, the Company Reports complied in all material

respects with all statutes and applicable rules and regulations of the applicable

Governmental Entities. In the case of each such Company Report filed with or furnished

to the SEC, such Company Report (A) did not, as of its date or if amended prior to the

Signing Date, as of the date of such amendment, contain an untrue statement of a material

fact or omit to state a material fact necessary in order to make the statements made

8

(NY) 078651OO2ffARPISPA.doc
therein, in light of the circumstances under which they were made, not misleading, and

(B) complied as to form in all material respects with the applicable requirements of the

Securities Act and the Exchange Act. With respect to all other Company Reports, the

Company Reports were complete and accurate in all material respects as of their

respective dates. No executive officer of the Company or any·Company Subsidiary has

failed in any respect to make the certifications required of him or her under Section 302

or 906 ofthe Sarbanes-Oxley Act of 2002.

(ii) The records, systems, controls, data and information of the Company and

the Company Subsidiaries are recorded, stored, maintained and operated under means

(including any electronic, mechanical or photographic process, whether computerized or

not) that are under the exclusive ownership and direct control of the Company or the

Company Subsidiaries or their accountants (including all means of access thereto and

therefrom), except for any non-exclusive ownership and non-direct control that would not

reasonably be expected to have a material adverse effect on the system of internal

accounting controls described below in this Section 2.2(i)(ii). The Company (A) has

implemented and maintains disclosure controls and procedures (as defined in Rule 13a15(e) of the Exchange Act) to ensure that material information relating to the Company,

including the consolidated Company Subsidiaries, is made known to the chief executive

officer and the chief financial officer of the Company by others within those entities, and.

(B) has disclosed, based on its most recent evaluation prior to the Signing Date, to the

Company's outside auditors and the audit committee of the Board of Directors (x) any

significant deficiencies and material weaknesses in the design or operation of internal

controls over financial reporting (as defined in Rule] 3a-15(f) of the Exchange Act) that

are reasonably likely to adversely affect the Company's ability to record, process,

summarize and report financial information and (y) any fraud, whether or not material,

that involves management or other employees who have a significant role in the

Company's internal controls over financial reporting.

(j) No Undisclosed Liabilities. Neither the Company nor any of the Company

Subsidiaries has any liabilities or obligations of any nature (absolute, accrued, contingent or

otherwise) which are not properly reflected or reserved against in the Company Financial

Statements to the extent required to be so reflected or reserved against in accordance with GAAP,

except for (A) liabilities that have arisen since the last fiscal year end in the ordinary and usual

course of business and consistent with past practice and (B) liabilities that, individually or in the

aggregate, have not had and would not reasonably be expected to have a Company Material

Adverse Effect.

(k) Offering of Securities. Neither the Company nor any person acting on its behalf

has taken any action (including any offering of any securities of the Company under

circumstances which would require the integration of such offering with the offering of any of

the Purchased Securities under the Securities Act, and the rules and regulations ofthe SEC

promulgated thereunder), which might subject the offering, issuance or sale of any of the

Purchased Securities to Investor pursuant to this Agreement to the registration requirements of

the Securities Act.

9

(NY) 078651OO21fARPISPA.doc
(1) Litigation and Other Proceedings. Except (i) as set forth on Schedule C or (ii) as

would not, individually or in the aggregate, reasonably be expected to have a Company Material

Adverse Effect, there is no (A) pending or, to the knowledge of the Company, threatened, claim,

action, suit, investigation or proceeding, against the Company or any Company Subsidiary or to

which any of their assets are subject nor is the Company or any Company Subsidiary subject to

any order, judgment or decree or (B) unresolved violation, criticism or exception by any

Governmental Entity with respect to any report or relating to any examinations or inspections of

the Company or any Company Subsidiaries.

(m) Compliance with Laws. Except as would not, individually or in the aggregate,

reasonably be expected to have a Company Material Adverse Effect, the Company and the

Company Subsidiaries have all permits, licenses, franchises, authorizations, orders and approvals

of, and have made all filings, applications and registrations with, Governmental Entities that are

required in order to permit them to own or lease their properties and assets and to carryon their

business as presently conducted and that are material to the business of the Company or such

Company Subsidiary. Except as set forth on Schedule D, the Company and the Company

Subsidiaries have complied in all respects and are not in default or violation of, and none of them

is, to the knowledge of the Company, under investigation with respect to or, to the knowledge of

the Company, have been threatened to be charged with or given notice of any violation of, any

applicable domestic (federal, state or local) or foreign law, ·statute, ordinance, license, rule,

regulation, policy or guideline, order, demand, writ, injunction, decree or judgment of any

Governmental Entity, other than such noncompliance, defaults or violations that would not,

individually or in the aggregate, reasonably be expected to have a Company Material Adverse

Effect. Except for statutory or regulatory restrictions of general application or as set forth on

Schedule D, no Governmental Entity has placed any restriction on the business or properties of

the Company or any Company Subsidiary that would, individually or in the aggregate,

.reasonably be expected to have a Company Material Adverse Effect.

(n) Employee Benefit Matters. Except as would not reasonably be expected to have,

either individually or in the aggregate, a Company Material Adverse Effect: (A) eac.h "employee

benefit plan" (within the meaning of Section 3(3) of the Employee Retirement Income Security

Act of 1974, as amended ("ERISA"» providing benefits to any current or former employee,

officer or director of the Company or any member of its "Controlled Group" (defined as any

organization which is a member of a controlled group of corporations within the meaning of

Section 414 of the Internal Revenue Code of 1986, as amended (the "Code"» that is sponsored,

maintained or contributed to by the Company or any member of its Controlled Group and for

which the Company or any member of its Controlled Group would have any liability, whether

actual or contingent (each, a "Plan") has been maintained in compliance with its terms and with

the requirements of all applicable statutes, rules and regulations, including ERISA and the Code;

(B) with respect to each Plan subject to Title IV of ERISA (including, for purposes of this clause

(B), any plan subject to Title IV of ERISA that the Company or any member of its Controlled

Group previously maintained or contributed to in the six years prior to the Signing Date), (1) no

"reportable event" (within the meaning of Section 4043(c) of ERISA), other than a reportable

event for which the notice period referred to in Section 4043(c) of ERISA has been waived, has

occurred in the three years prior to the Signing Date or is reasonably expected to occur, (2) no

10

(NY) 07865tOO2fTARP/SPA.doc
"accumulated funding deficiency" (within the meaning of Section 302 of ERISA or Section 412

of the Code), whether or not waived, has occurred in the three years prior to the Signing Date or

is reasonably expected to occur, (3) the fair market value of the assets under each Plan exceeds

the present value of all benefits accrued under such Plan (determined based on the assumptions

used to fund such Plan) and (4) neither the Company nor any member of its Controlled Group

has incurred in the six years prior to the Signing Date, or reasonably expects to incur, any

liability under Title IV of ERISA (other than contributions to the Plan or premiums to the PBGC

in the ordinary course and without default) in respect of a Plan (including any Plan that is a

"multiemployer plan", within the meaning of Section 4001 (c)(3) of ERISA); and (C) each Plan

that is intended to be qualified under Section 401(a) of the Code has received a favorable

determination letter from the Internal Revenue Service with respect to its qualified status that has

not been revoked, or such a determination letter has been timely applied for but not received by

the Signing Date, and nothing has occurred, whether by action or by failure to act, which could

reasonably be expected to cause the loss, revocation or denial of such qualified status or

favorable determination letter.

(0) Taxes. Except as would not, individually or in the aggregate, reasonably be

expected to have a Company Material Adverse Effect, (i) the Company and the Company

Subsidiaries have filed all federal, state, local and foreign income and franchise Tax returns

required to be filed through the Signing Date, subject to permitted extensions, and have paid all

Taxes due thereon, and (ii) no Tax deficiency has been determined adversely to the Company or

any of the Company Subsidiaries, nor does the Company have any knowledge of any Tax

deficiencies. "Tax" or "Taxes" means any federal, state, local or foreign income, gross receipts,

property, sales, use, license, excise, franchise, employment, payroll, withholding, alternative or

add on minimum, ad valorem, transfer or excise tax, or any other tax, custom, duty,

governmental fee or other like assessment or charge of any kind whatsoever, together with any

interest or penalty, imposed by any Governmental Entity.

(p) Properties and Leases. Except as would not, individually or in the aggregate,

reasonably be expected to have a Company Material Adverse Effect, the Company and the

Company Subsidiaries have good and marketable title to all real properties and all other

properties and assets owned by them, in each case free from liens, encumbrances, claims and

defects (other than liens, encumbrances, claims or defects created pursuant to the Guarantee and

Pledge Agreement, dated as of September 22, 2008, between the Company and the FRBNY) that

would affect the value thereof or interfere with the use made or to be made thereof by them.

Except as would not, individually or in the aggregate, reasonably be expected to have a

Company Material Adverse Effect, the Company and the Company Subsidiaries hold all leased

real or personal property under valid and enforceable leases with no exceptions that would

interfere with the use made or to be made thereof by them.

(q) Environmental Liability. Except as would not, individually or in the aggregate,

reasonably be expected to have a Company Material Adverse Effect:

(i) there is no legal, administrative, or other proceeding, claim or action of

any nature seeking to impose, or that would reasonably be expected to result in the

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(NY) 078651OO2ffARPISPA.doc
imposition of, on the Company or any Company Subsidiary. any liability relating to the

release of hazardous substances as defined under any local, state or federal environmental

statute, regulation or ordinance, including the Comprehensive Environmental Response,

Compensation and Liability Act of 1980, pending or, to the Company's knowledge,

threatened against the Company or any Company Subsidiary;

(ii) to the Company's knowledge, there is no reasonable basis for any such

proceeding, claim or action; and

(iii) neither the Company nor any Company Subsidiary is subject to any

agreement, order, judgment or decree by or with any court, Governmental Entity or third

party imposing any such environmental liability.

(r) Risk Management Instruments. Except as would not, individually or in the

aggregate, reasonably be expected to have a Company Material Adverse Effect, all derivative

instruments, including, swaps, caps, floors and option agreements, whether entered into for the

Company's own account, or for the account of one or more of the Company Subsidiaries or its or

their customers, were entered into (i) only in the ordinary course of business, (ii) in accordance

with prudent practices and in all material respects with all applicable laws, rules, regulations and

regulatory policies and (iii) with counterparties believed to.be financially responsible at the time;

and each of such instruments constitutes the valid and legally binding obligation of the Company

or one of the Company Subsidiaries, enforceable in accordance with its terms, except as may be

limited by the Bankruptcy Exceptions. Neither the Company or the Company Subsidiaries, nor.

to the knowledge of the Company. any other party thereto. is in breach of any of its obligations

under any such agreement or arrangement other than such breaches that would not, individually

or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

(s) Agreements with Regulatory Aeencies. Except as set forth on Schedule E, neither

the Company nor any Company Subsidiary is subject to any material cease-and-desist or other

similar order or enforcement action issued by, or is a party to any material written agreement,

consent agreement or memorandum of understanding with. or is a party to any commitment letter

or similar undertaking to. or is subject to any capital directive by. or since December 31,2006,

has adopted any board resolutions at the request of, any Governmental Entity (other than the

primary insurance regulators with jurisdiction over the Company Subsidiaries) that currently

restricts in any material respect the conduct of its business or that in any material manner relates

to its capital adequacy, its liquidity and funding policies and practices, its ability to pay

dividends. its credit. risk management or compliance policies or procedures, its internal controls.

its management or its operations or business. Each item in the immediately preceding sentence

and without taking into consideration of the parenthetical provided therein. is referred to herein

as a "Regulatory Agreement." Neither the Company nor any Company Subsidiary has been .

advised since December 31, 2006 by any such Governmental Entity that it is considering issuing,

initiating, ordering, or requesting any such Regulatory Agreement (other than any such

Regulatory Agreement that does not have a Company Material Adverse Effect). Except as set

forth on Schedule E, the Company and each Company Subsidiary are in compliance in all

material respects with each Regulatory Agreement to which it is party or subject. and neither the

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(NY) 078651OO2ffARPISPA.doc
Company nor any Company Subsidiary has received any notice from any Governmental Entity

indicating that either the Company or any Company Subsidiary is not in compliance in all

material respects with any such Regulatory Agreement.

(t) Insurance. The Company and the Company Subsidiaries are insured with reputable

insurers against such risks and in such amounts as the management of the Company reasonably

has determined to be prudent and consistent with industry practice. The Company and the

Company Subsidiaries are in material compliance with their insurance policies and are not in

default under any of the material terms thereof, each such policy is outstanding and in full force

and effect, all premiums and other payments due under any material policy have been paid, and

all claims thereunder have been filed in due and timely fashion, except, in each case, as would

not, individually or in the aggregate, reasonably be expected to have a Company Material

Adverse Effect.

(u) Intellectual Property. Except as would not, individually or in the aggregate,

reasonably be expected to have a Company Material Adverse Effect, (i) the Company and each

Company Subsidiary owns or otherwise has the right to use, all intellectual property rights,

including all trademarks, trade dress, trade names, service marks, domain names, patents,

inventions, trade secrets, know-how, works of authorship and copyrights therein, that are used in

the conduct of their existing businesses and all rights relating to the plans, design and

specifications of any of its branch facilities ("Proprietary Rights") free and clear of all liens and

any claims of ownership by current or former employees, contractors, designers or others and (ii)

neither the Company nor any of the Company Subsidiaries is materially infringing, diluting,

misappropriating or violating, nor has the Company or any or the Company Subsidiaries received

any written (or, to the knowledge ofthe Company, oral) communications alleging that any of

them has materially infringed, diluted, misappropriated or violated, any of the Proprietary Rights

owned by any other person. Except as would not, individually or in the aggregate, reasonably be

expected to have a Company Material Adverse Effect, to the Company's knowledge, no other

person is infringing, diluting, misappropriating or violating, nor has the Company or any or the

Company Subsidiaries sent any written communications since January 1,2006 alleging that any

person has infringed, diluted, misappropriated or violated, any of the Proprietary Rights owned

by the Company and the Company Subsidiaries.

(v) Brokers and Finders. No broker, finder or investment banker is entitled to any

financial advisory, brokerage, finder's or other fee or commission in connection with this

Agreement or the Warrant or the transactions contemplated hereby or thereby based upon

arrangements made by or on behalf ofthe Company or any Company Subsidiary for which the

Investor could have any liability.

Article 3

Covenants

3.1 Consummation ofPurchase and Charter Amendment.Subject to the terms and

conditions of this Agreement, each of the parties will use its commercially reasonable efforts in

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(NY) 078651OO2ITARPISPA.doc
good faith to take, or cause to be taken, all actions, and to do, or cause to be done, all things

necessary, proper or desirable, or advisable under applicable laws, so as to permit consummation

of the Purchase as promptly as practicable and otherwise to enable consummation of the

transactions contemplated hereby and shall use commercially reasonable efforts to cooperate

with the other party to that end.

(b) The Company shall call a special meeting of its stockholders to vote on a proposal

(the "Stockholder Proposar') to amend the Company's Charter to allow the Preferred Stock to

rank senior to the Series C Preferred Stock and any other series of preferred stock issued .by the

Company. In connection with such meeting, the Company shall prepare (and the Investor will

reasonably cooperate with the Company to prepare) and file with the SEC as promptly as

practicable (but in no event more than ten business days after the issuance of the Series C

Preferred Stock) a preliminary proxy statement, shall use its reasonable best efforts to respond to

any comments of the SEC or its staff thereon and to cause a definitive proxy statement related'to

such stockholders' meeting to be mailed to the Company's stockholders not more than five

business days after clearance thereof by the SEC. The Company shall notify the Investor

promptly ofthe receipt of any comments from the SEC or its staff with respect to the proxy

statement and of any request by the SEC or its staff for amendments or supplements to such

proxy statement or for additional information and will supply the Investor with copies of all

correspondence between the Company or any of its representatives, on the one hand, and the

SEC or its staff, on the other hand, with respect to such proxy statement. If at any time prior to

such stockholders' meeting there shall occur any event that is required to be set forth in an

amendment or supplement to the proxy statement, the Company shall as promptly as practicable

prepare and mail to its stockholders such an amendment or supplement. Each of the Investor and

the Company agrees promptly to correct any information provided by it or on its behalf for use in

the proxy statement if and to the extent that such information shall have become false or

misleading in any material respect, and the Company shall as promptly as practicable prepare

and mail to its stockholders an amendment or supplement to correct such information to the

extent required by applicable laws and regulations. The Company shall consult with the Investor

prior to filing any proxy statement, or any amendment or supplement thereto, and provide the

Investor with a reasonable opportunity to comment thereon. In the event that the approval of the

Stockholder Proposal is not obtained at such special stockholders meeting, the Company shall

include a proposal to approve such proposal at a meeting of its stockholders no less than once in

each subsequent twelve-month period beginning on January 1,2009 until such approval is

obtained or made.

(c) None of the information supplied by the Company or any of the Company

Subsidiaries for inclusion in any proxy statement in connection with any such stockholders

meeting of the Company will, at the date it is filed with the SEC, when first mailed to the

Company's stockholders and at the time of any stockholders meeting, and at the time of any

amendment or supplement thereof, contain any untrue statement of a material fact or omit to

state any material fact necessary in order to make the statements therein, in light of the

circumstances under which they are made, not misleading.

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(NY) 078651OO2ffARP/SPA.doc
3.2 Expenses. Unless otherwise provided in this Agreement or the Warrant, each of

the parties hereto will bear and pay all costs and expenses incurred by it or on its behalf in

connection with the transactions contemplated under this Agreement or the Warrant, including

fees and expenses of its own financial or other consultants, investment bankers, accountants and

counsel.

3.3 Sufficiency ofAuthorized Common Stock; Exchange Listing.

(a) During the period from the Closing Date until the date on which the Warrant has

been fully exercised, the Company shall at all times have reserved for issuance, free of

preemptive or similar rights, a sufficient number of authorized and unissued Warrant Shares to

effectuate such exercise. Nothing in this Section 3.3 shall preclude the Company from satisfying

its obligations in respect ofthe exercise of the Warrant by delivery of shares of Common Stock

which are held in the treasury 'of the Company. As soon as reasonably practicable following the

Closing, the Company shall, at its expense, cause the Warrant Shares to be listed on the same

national securities exchange on which the Common Stock is listed, subject to official notice of

issuance, and shall maintain such listing for so long as any Common Stock is listed on such

exchange. .

(b) If requested by the Investor, the Company shall promptly use its reasonable best

efforts to cause the Preferred Stock to be approved for listing on a national securities exchange as

promptly as practicable following such request.

3.4 Certain Notifications Until Closing. From the Signing Date until the Closing, the

Company shall promptly notify the Investor of (i) any fact, event or circumstance of which it is

aware and which would reasonably be expe~ted to cause any representation or warranty of the

Company contained in this Agreement to be untrue or inaccurate in any material respect or to

cause any covenant or agreement of the Company contained in this Agreement not to be

complied with or satisfied in any material respect and (ii) except as Previously Disclosed, any

fact, circumstance, event, change, occurrence, condition or development of which the Company

is aware and which, individually or in the aggregate, has had or would reasonably be expected to

have a Company Material Adverse Effect; provided, however, that delivery of any notice

pursuant to this Section 3.4 shall not limit or affect any rights of or remedies available to the

Investor; provided, further, that a failure to comply with this Section 3.4 shall not constitute a

breach of this Agreement or the failure of any condition set forth in Section 1.2 to be satisfied

unless the underlying Company Material Adverse Effect or material breach would independently

result in the failure of a condition set forth in Section 1.2 to be satisfied.

3.5 Information and Confidentiality.

(a) Until such time as the Investor ceases to own any Preferred Stock, or except as

otherwise agreed, the Company shall provide the Investor (i) the information required to be

provided by the Company to FRBNY pursuant to Section 5.04 of the Credit Agreement and

within the time periods for delivery thereof specified in the Credit Agreement and (ii) the notices

required by Section 5.05 of the Credit Agreement and within the time periods for delivery

15

(NY) 0786S1OO2IfARPISPA.dor
thereof specified in the Credit Agreement. After the termination of the Credit Agreement, such

informational and notice requirements as are provided in Section 5.04 and Section 5.05 of the

Credit Agreement shall remain in full force and effect until such time as the Investor no longer

owns any Preferred Stock. In addition, until such time as the Investor ceases to own any debt or

equity securities pursuant to this Agreement or the Warrant, or except as otherwise agreed, the

Company shall provide the Investor a bi-annual report on the steps taken by the Company to

comply in all respects with Section III(b) of the EESA, including the provisions for

Systemically Significant Failing Institutions, as implemented by any guidance or regulation

thereunder, including Notice 2008-PSSFI, and with Section 4.10 of this Agreement. In addition,

the Company shall promptly provide the Investor such other information and notices as the

Investor may reasonably request from time to time.

(b) The Investor will use reasonable best efforts to hold, and will use reasonable best

efforts to cause its agents, consultants, contractors and advisors to hold, in confidence all oonpublic records, books, contracts, instruments, computer data and other data and information

(collectively, "Information") concerning the Company furnished or made available to it by the

Company or its representatives pursuant to this Agreement (except to the extent that such

information can be shown to have been (i) previously known by such party on a non-confidential

basis, (ii) in the public domain through no fault of such party or (iii) later lawfully acquired from

other sources by the party to which it was furnished (and without violation of any other

confidentiality obligation»; provided that nothing herein shall prevent the Investor from

disclosing any Information to the extent required by applicable laws or regulations or by any

subpoena or similar legal process.

Article 4

Additional Agreements

4.1 Purchase ofRestricted Securities. The Investor acknowledges that the Purchased

Securities and the Warrant Shares have not been registered under the Securities Act or under any

state securities laws. The Investor (a) is acquiring the Purchased Securities pursuant to an

exemption from registration under the Securities Act with no present intention to distribute them

to any person in violation of the Securities Act or any applicable U.S. state securities laws, (b)

will not sell or otherwise dispose of any of the Purchased Securities or the Warrant Shares,

except in compliance with the registration requirements or exemption provisions of the Securities

Act and any applicable U.S. state securities laws, and (c) has such knowledge and experience in

financial and business matters and in investments of this type that it is capable of evaluating the

merits and risks of the Purchase and of making an informed investment decision.

4.2 Legends.

(a) The Investor agrees that all certificates or other instruments representing the

Warrant and the Warrant Shares will bear a legend substantially to the following effect:

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(NY) 07865IOO2ffARP/SPA.doc
"THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN

REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE

SECURITIES LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED, SOLD

OR OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION

STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND

APPLICABLE STATE SECURlTIES LAWS OR PURSUANT TO AN EXEMPTION

FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS."

(b) In addition, the Irivestor agrees that all certificates or other instruments representing

the Preferred Stock will bear a legend substantially to the following effect:

"THE SECURlTIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN

REGISTERED UNDER THE SECURlTIES ACT OF 1933, AS AMENDED (THE

"SECURITIES ACT"), OR THE SECURlTIES LAWS OF ANY STATE AND MAY

NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE

A REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER

SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO

AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS.

EACH PURCHASER OF THE SECURITIES REPRESENTED BY THIS

INSTRUMENT IS NOTIFIED THAT THE SELLER MAY BE RELYING ON THE

EXEMPTION FROM SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE

144A THEREUNDER. ANY TRANSFEREE OF THE SECURITIES REPRESENTED

BY THIS INSTRUMENT BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT

IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A

UNDER THE SECURITIES ACT), (2) AGREES THAT IT WILL NOT OFFER, SELL

OR OTHERWISE TRANSFER THE SECURITIES REPRESENTED BY THIS

INSTRUMENT EXCEPT (A) PURSUANT TO A REGISTRATION STATEMENT

WHICH IS THEN EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO LONG

AS THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE ELIGIBLE

FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY

BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE

144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN

ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER

TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN

RELIANCE ON RULE 144A, (C) TO THE ISSUER OR (D) PURSUANT TO ANY

OTHER AVAlLABLE EXEMPTION FROM THE REGISTRAnON

REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL

GIVE TO EACH PERSON TO WHOM THE SECURITIES REPRESENTED BY THIS

INSTRUMENT ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE

EFFECT OF THIS LEGEND."

(c) In the event that any Purchased Securities or Warrant Shares (i) become registered

under the Securities Act or (ii) are eligible to be transferred without restriction in accordance

with Rule 144 or another exemption from registration under the Securities Act (other than Rule

144A), the Company shall issue new certificates or other instruments representing such

17

(NY) 0786SIOO2ffARPISPA.doc
Purchased Securities or Warrant Shares, which shall not contain the applicable legends in

Sections 4.2(a) and (b) above; provided that the Investor surrenders to the Company the

previously issued certificates or other instruments. Upon Transfer of all or a portion of the

Warrant in compliance with Section 4.4 the Company shall issue new certificates or other

instruments representing the Warrant, which shall not contain the applicable legend in Section·

4.2(b) above; provided that the Investor surrenders to the Company the previously issued

certificates or other instruments.

4.3 Certain Transactions. The Company will not merge or consolidate with, or sell,

transfer or lease all or substantially all of its property or assets to, any other party unless the

successor, transferee or lessee party (or its ultimate parent entity), as the case may be (if not the

Company), expressly assumes the due and punctual perfonnance and observance of each and

every covenant, agreement and condition of this Agreement to be perfonned and observed by the

Company.

4.4 Tra1lsfer ofPurchased Securities. the Warrant a1ld Warrant Shares. Subject to

compliance with applicable securities laws, the Investor shall be pennitted to transfer, sell, assign

or otherwise dispose of ("Transfer") all or a portion of the Purchased Securities, the Warrant or

Warrant Shares at any time, and the Company shall take all steps as may be reasonably requested

by the Investor to facilitate the Transfer of the Purchased Securities, the Warrant and the Warrant

Shares.

4.5 Registration Rights.

(a) Registration.

(i) Subject to the terms and conditions of this Agreement, the Company

covenants and agrees that as promptly as practicable after notification from the Investor,

and in any event no later than 15 days after such notification, the Company shall prepare

and file with the SEC a Shelf Registration Statement covering all Registrable Securities

(or otherwise designate an existing Shelf Registration Statement filed with the SEC to

cover the Registrable Securities), and, to the extent the Shelf Registration Statement has

not theretofore been declared effective or is not automatically effective upon such filing,

the Company shall use reasonable best efforts to cause such Shelf Registration Statement

to be declared or become effective and to keep such Shelf Registration Statement .

continuously effective and in compliance with the Securities Act and usable for resale of

such Registrable Securities for a period from the date of its initial effectiveness until such

time as th~re are no Registrable Securities remaining (including by refiling such Shelf

Registration Statement (or a new Shelf Registration Statement) if the initial Shelf

Registration Statement expires). So long as the Company is a well known seasoned

issuer (as defined in Rule 405 under the Securities Act) at the time of filing of the Shelf

Registration Statement with the SEC, such Shelf Registration Statement shall be

designated by the Company as an automatic Shelf Registration Statement.

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(NY) 078651OO2fTARPISPA.doc
(ii) Any registration pursuant to Section 4,5(a)(i) shall be effected by means of

a shelf registration on an appropriate fonn under Rule 415 under the Securities Act (a

"Shelf Registration Statement"). If the Investor or any other Holder intends to

distribute any Registrable Securities by means of an underwritten offering it shall

promptly so advise "the Company and the Company shall take all reasonable steps to

facilitate such distribution, including the actions required pursuant to Section 4.5(c);

provided that the Company shall not be required to facilitate an underwritten offering of

Registrable Securities unless the expected gross proceeds from such offering exceed $200

million. The lead underwriters in any such distribution shall be selected by the Holders

of a majority of the Registrable Securities to be distributed.

(iii) The Company shall not be required to effect a registration (including a

resale of Registrable Securities from an effective Shelf Registration Statement) or an

underwritten offering pursuant to Section 4.5(a): (A) with respect to securities that are

not Registrable Securities; or (B) if the Company has notified the Investor and all other

Holders that in the good faith judgment of the Board of Directors, it would be materially

detrimental to the Company or its securityholders for such registration or underwritten

offering to be effected at such time, in which event the Company shall have the right to

defer such registration for a period of not more than 45 days after receipt of the request of

the Investor or any other Holder; provided that such right to delay a registration or

underwritten offering shall be exercised by the Company (1) only if the Company has

generally exercised (or is concurrently exercising) similar black-out rights against holders

of similar securities that have registration rights and (2) not more than three times in any

12-month period and not more than 90 days in the aggregate in any 12-month period.

(iv) If during any period when an effective Shelf Registration Statement is not

available, the Company proposes to register any of its equity securities, other than a

registration pursuant to Section 4.5(a)(i) or a Special Registration, and the registration

fonn to be filed may be used for the registration or qualification for disiribution of

Registrable Securities, the Company will give prompt written notice to the Investor and

all other Holders of its intention to effect such a registration (but in no event less than ten

days prior to the anticipated filing date) and will include in such registration all

Registrable Securities with respect to which the Company has received written requests

for inclusion therein within ten business days after the date ofthe Company's notice (a

"Piggyback Registration"). Any such person that has made such a written request may

withdraw its Registrable Securities from such Piggyback Registration by giving written

notice to the Company and the managing underwriter, if any, on or before the fifth

business day prior to the planned effective date of such Piggyback Registration. The

Company may terminate or withdraw any registration under this Section 4.5(a)(iv) prior

to the effectiveness of such registration, whether or not Investor or any other Holders

have elected to include Registrable Securities in such registration.

(v) If the registration referred to in Section 4.5(a)(iv) is proposed to be

underwritten, the Company will so advise Investor and all other Holders as a part of the

written notice given pursuant to Section 4.5(a)(iv). In such event, the right of Investor

19

(NY) 0786SAlO2ffARP/SPA.doc
and all other Holders to registration pursuant to Section 4.5(a) will be conditioned upon

such persons' participation in such underwriting and the inclusion of such person's

Registrable Securities in the underwriting if such securities are of the same class of

securities as the securities to be offered in the underwritten offering, and each such

person will (together with the Company and the other persons distributing their securities

through such underwriting) enter into an underwriting agreement in customary fonn with

the underwriter or underwriters selected for such underwriting by the Company; provided

that the Investor (as opposed to other Holders) shall not be required to indemnify any

person in connection with any registration. If any participating person disapproves of the

terms of the underwriting, such person may elect to withdraw therefrom by written notice

to the Company, the managing underwriters and the Investor (if the Investor is

participating in the underwriting).

(vi) If either (x) the Company grants "piggyback" registration rights to one or

more third parties to include their securities in an underwritten offering under a Shelf

Registration Statement pursuant to Section 4.5(a)(ii) or (y) a Piggyback Registration

under Section 4.5(a)(iv) relates to an underwritten offering on behalf of the Company,

and in either case the managing underwriters advise the Company that in their reasonable

opinion the number of securities requested to be included in such offering exceeds the

number which can be sold without adversely affecting the marketability of such offering

(including an adverse effect on the per share offering price), the Company will include in

such offering only such number of securities that in the reasonable opinion of such

managing underwriters can be sold without adversely affecting the marketability of the

offering (including an adverse effect on the per share offering price), which securities

will be so included in the following order of priority: (A) first, in the case of a Piggyback

Registration under Section 4.5(a)(iv), the securities the Company proposesto sell, (B)

then the Registrable Securities of the Investor and all other Holders who have requested

inclusion of Registrable Securities pursuant to Section 4.5(a)(ii) or Section 4.5(a)(iv), as

applicable, pro rata on the basis of the aggregate number of such securities or shares

owned by each such person and (C) lastly, any other securities of the Company that have

been requested to be so included, subject to the terms of this Agreement; provided,

however, that if the Company has, prior to the Signing Date, entered into an agreement

with respect to its securities that is inconsistent with the order of priority contemplated

hereby then it shall apply the order of priority in such conflicting agreement to the extent

that it would otherwise result in a breach under such agreement.

(b) Expenses of Registration. All Registration Expenses incurred in connection with

any registration, qualification or compliance hereunder shall be borne by the Company. All

Selling Expenses incurred in connection with any registrations hereunder shall be borne by the

holders of the securities so registered pro rata on the basis of the aggregate offering or sale price

ofthe securities so registered.

(c) Obligations of the Company. The Company shall use its reasonable best efforts,

for so long as there are Registrable Securities outstanding, to take such actions as are in its

control to become a well-known seasoned issuer (as defined in Rule 405 under the Securities Act)

20

(NY) 078651OO2IrARP/SPA.doc
and once the Company becomes a well-known seasoned issuer to take such actions as are in its

control to remain a well-known seasoned issuer. In addition, whenever required to effect the

registration of any Registrable Securities or facilitate the distribution ofRegistrable Securities

pursuant to an effective ShelfRegistration Statement, the Company shall, as expeditiously as

reasonably practicable:

(i) Prepare and file with the SEC, not later than fifteen (15) days after the

request, a registration statement with respect to such Registrable Securities and use all

commercially reasonable efforts to cause such registration statement to become effective,

or prepare and file with the SEC not later than ten (l0) days after the request a prospectus

supplement with respect to a proposed offering of such Registrable Securities pursuant to

an effective registration statement, subject to Section 4.5(d), and, upon the request of the

Holders of a majority of the Registrable Securities registered thereunder, use all

commercially reasonable efforts to keep such registration statement effective and keep

such prospectus supplement current until the securities described therein are no longer

Registrable Securities.

Oi) Prepare and file with the SEC such amendments and supplements to the

applicable registration statement and the prospectus or prospectus supplement used in

connection with such registration statement as may be necessary to comply with the

provisions of the Securities Act with respect to the disposition of all securities covered by

such registration statement.

(iii) Furnish to the Holders and any underwriters such number of copies of the

applicable registration statement and each such amendment and supplement thereto

(including in each case all exhibits) and of a prospectus, including a preliminary

prospectus, in conformity with the requirements of the Securities Act, and such other

documents as they may reasonably request in order to facilitate the disposition of

Registrable Securities owned or to be distributed by them.

(iv) Use its reasonable best efforts to register and qualify the securities covered

by such registration statement under such other securities or Blue Sky laws of such

jurisdictions as shall be reasonably requested by the Holders or any managing

underwriter(s), to keep such registration or qualification in effect for so long as such

registration statement remains in effect, and to take any other action which may be

reasonably necessary to enable such seller to consummate the disposition in such

jurisdictions of the securities owned by such Holder; provided that the Company shall not

be required in connection therewith or as a condition thereto to qualify to do business or

to file a general consent to service of process in any such states or jurisdictions.

(v) Notify each Holder of Registrable Securities at any time when a

prospectus relating thereto is required to be delivered under the Securities Act of the

happening of any event as a result of which the applicable prospectus, as then in effect,

includes an untrue statement of a material fact or omits to state a material fact required to

21

(NY) 078651OO2frARP/sPA.doc
be stated therein or necessary to make the statements therein not misleading in light of

the circumstances then existing.

(vi) Give written notice to the Holders:

(A) when any registration statement filed pursuant to Section 4.5(a)

or any amendment thereto has been filed with the SEC (except for any

amendment effected by the filing of a document with the SEC pursuant to the

Exchange Act) and when such registration statement or any post-effective

amendment thereto has become effective;

(B) of any request by the SEC for amendments or supplements to any

registration statement or the prospectus included therein or for additional

information;

(C) of the issuance by the SEC of any stop order suspending the

effectiveness of any registration statement or the initiation of any proceedings for

that purpose;

(D) of the receipt by the Company or its legal counsel of any

notification with respect to the suspension of the qualification of the Common

Stock for sale in any jurisdiction or the initiation or threatening of any

proceeding for such purpose;

(E) of the happening of any event that requires the Company to make

changes in any effective registration statement or the prospectus related to the

registration statement in order to make the statements therein not misleading

(which notice shall be accompanied by an instruction to suspend the use of the

prospectus until the requisite changes have been made); and

(F) if at any time the representations and warranties of the Company

contained in any underwriting agreement contemplated by Section 4.5(c)(x)·

cease to be true and correct.

(vii) Use its reasonable best efforts to prevent the issuance or obtain the

withdrawal of any order suspending the effectiveness of any registration statement

referred to in Section 4.5(c)(vi)(C) at the earliest practicable time.

(viii) Upon the occurrence of any event contemplated by Section 4.5(c)(v)or

4.5(c)(vi)(E), promptly prepare a post-effective amendment to such registration statement

or a supplement to the related prospectus or file any other required document so that, as

thereafter delivered to the Holders and any underwriters, the prospectus will not contain

an untrue statement of a material fact or omit to state any material fact necessary to make

the statements therein, in light ofthe circumstances under which they were made, not

misleading. If the Company notifies the Holders in accordance with Section 4.5(c)(vi)(E)

22

(NY) 078651OO2fTARP/SPA.doc
to suspend the use ofthe prospectus until the requisite changes to the prospectus have

been made, then the Holders and any underwriters shall suspend use of such prospectus

and use their reasonable best efforts to return to the Company all copies ofsuch

prospectus (at the Company's expense) other than permanent file copies then in such

Holders' or underwriters' possession. The total number of days that any such suspension

may be in effect in any 12-month period shall not exceed 90 days.

(ix) Use reasonable best efforts to procure the cooperation of the Company's

transfer agent in settling any offering or sale of Registrable Securities, including with

respect to the transfer of physical stock certificates into book-entry form in accordance

with any procedures reasonably requested by the Holders or any managing underwriter(s).

(x) If an underwritten offering is requested pursuant to Section 4.5(a)(ii), enter

into an underwriting agreement in customary form, scope and substance and take all such

other actions reasonably requested by the Holders of a majority of the Registrable

Securities being sold in connection therewith or by the managing underwriter(s), if any,

to expedite or facilitate the underwritten disposition ofsuch Registrable Securities, and in

connection therewith in any underwritten offering (including making members of

management and executives of the Company available to participate in "road shows",

similar sales events and other marketing activities),.(A) make such representations and

warranties to the Holders that are selling stockholders and the managing underwriter(s), if

any, with respect to the business of the Company and its subsidiaries, and the Shelf

Registration Statement, prospectus and documents, if any, incorporated or deemed to be

incorporated by reference therein, in each case, in customary form, substance and scope,

and, if true, confirm the same if and when requested, (B) use its reasonable best efforts to

furnish the underwriters with opinions of counsel to the Company, addressed to the

managing underwriter(s), if any, covering the matters customarily covered in such

opinions requested in underwritten offerings, (C) use its reasonable best efforts to obtain

"cold comfort" letters from the independent certified public accountants of the Company

(and, if necessary, any other independent certified public accountants of any business

acquired by the Company for which financial statements and financial data are included

in the ShelfRegistration Statement) who have certified the financial statements included

in such Shelf Registration Statement, addressed to each of the managing underwriter(s), if

any, such letters to be in customary form and covering matters of the type customarily

covered in "cold comfort" letters, (D) if an underwriting agreement is entered into, the

same shall contain indemnification provisions and procedures customary in underwritten

offerings (provided that the Investor shall not be obligated to provide any indemnity), and

(E) deliver such documents and certificates as may be reasonably requested by the

Holders of a majority of the Registrable Securities being sold in connection therewith,

their counsel and the managing underwriter(s), if any, to evidence the continued validity

of the representations and warranties made pursuant to clause (A) above and to evidence

compliance with any customary conditions contained in the underwriting agreement or

other agreement entered into by the Company.

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(NY) 0786SIOO2ffARPISPA.doc
(xi) Make available for inspection by a representative of Holders that are

selling stockholders, the managing underwriter(s), if any, and any attorneys or

accountants retained by such Holders or managing underwriter(s), at the offices where

normally kept, during reasonable business hours, financial and other records, pertinent

corporate documents and properties of the Company, and cause the officers, directors and

employees of the Company to supply all information in each case reasonably requested

(and of the type customarily provided in connection with due diligence conducted in

connection with a registered public offering of securities) by any such representative,

managing underwriter(s), attorney or accountant in connection with such Shelf

Registration Statement.

(xii) Use reasonable best efforts to cause all such Registrable Securities to be

listed on each national securities exchange on which similar securities issued by the

Company are then listed or, if no similar securities issued by the Company are then listed

on any national securities exchange, use its reasonable best efforts to cause all such

Registrable Securities to be listed on such securities exchange as the Investor may

designate.

(xiii) If requested by Holders of a majority of the Registrable Securities being

registered and/or sold in connection therewith, or the managing underwriter(s), ifany,

promptly include in a prospectus supplement or amendment such information as the

Holders of a majority of the Registrable Securities being registered and/or sold in

connection therewith or managing underwriter(s), if any, may reasonably request in order

to permit the intended method of distribution of such securities and make all required

filings of such prospectus supplement or such amendment as soon as practicable after the

Company has received such request.

(xiv) Timely provide to its security holders earning statements satisfying the

provisions of Section l1(a) of the Securities Act and Rule 158 thereunder.

(d) Suspension ofSales. Upon receipt of written notice from the Company that a

registration statement, prospectus or prospectus supplement contains or may contain an untrue

statement of a material fact or pmits or may omit to state a material fact required to be stated

therein or necessary to make the statements therein not misleading or that circumstances exist

that make inadvisable use ofsuch registration statement, prospectus or prospectus supplement,

the lnvestor and each Holder of Registrable Securities shall forthwith discontinue disposition of

Registrable Securities until the Investor and/or Holder has received copies of a supplemented or

amended prospectus or prospectus supplement, or until the Investor and/or such Holder is

advised in writing by the Company that the use of the prospectus and, if applicable, prospectus

supplement may be resumed, and, if so directed by the Company, the Investor and/or such

Holder shall deliver to the Company (at the Company's expense) all copies, other than

permanent file copies then in the Investor and/or such Holder's possession, of the prospectus and,

if applicable, prospectus supplement covering such Registrable Securities current at the time of

receipt ofsuch notice. The total number of days that any such suspension may be in effect in any

12-month period shall not exceed 90 days.

24

(NY) 07865tOO2frARP/SPA.doc
(e) Termination ofRegistration Rights. A Holder's registration rights as to any

securities held by such Holder (and its Affiliates, partners, members and fonner members) shall

not be available unless such securities are Registrable Securities.

(f) Furnishing Information.

(i) Neither the Investor nor any Holder shall use any free writing prospectus

(as defined in Rule 405) in connection with the sale of Registrable Securities without the

prior written consent of the Company.

(ii) It shall be a condition precedent to the obligations of the Company to take

any action pursuant to Section 4.5(c) that Investor and/or the selling Holders and the

underwriters, if any, shall furnish to the Company such infonnation regarding themselves,

the Registrable Securities held by them and the intended method of disposition of such

securities as shall be required to effect the registered offering of their Registrable

Securities.

(g) Indemnification.

(i) The Company agrees to indemnify each Holder and, if a Holder is a

person other than an individual, such Holder's officers, directors, employees, agents,

representatives and Affiliates, and each Person, if any, that controls a Holder within the

meaning of the Securities Act (each, an "Indemnitee"), against any and all losses, claims,

damages, actions,liabilities, costs and expenses (including reasonable fees, expenses and

disbursements of attorneys and other professionals incurred in connection with

investigating, defending, settling, compromising or paying any such losses, claims,

damages, actions, liabilities, costs and expenses), joint or several, arising out of or based

upon any untrue statement or alleged untrue statement of material fact contained in any

registration statement, including any preliminary prospectus or final prospectus contained

therein or any amendments or supplements thereto or any documents incorporated therein

by reference or contained in any free writing prospectus (as such tenn is defined in Rule

405) prepared by the Company or authorized by it in writing for use by such Holder (or

any amendment or supplement thereto); or any omission to state therein a material fact

required to be stated therein or necessary to make the statements therein, in light of the

circumstances under which they were made, not misleading; provided that the Company

shall not be liable to such Indemnitee in any such case to the extent that any such loss,

claim, damage, liability (or action or proceeding in respect thereof) or expense arises out

of or is based upon (A) an untrue statement or omission made in such registration

statement, including any such preliminary prospectus or final prospectus contained

therein or any such amendments or supplements thereto or contained in any free writing

prospectus (as such term is defined in Rule 405) prepared by the Company or authorized

by it in writing for use by such Holder (or any amendment or supplement thereto), in

reliance upon and in conformity with information regarding such Indemnitee or its plan

of distribution or ownership interests which was furnished in writing to the Company by

such Indemnitee for use in connection with such registration statement, including any

25

(NY) 078651OO2frARPISPA.doc
such preliminary prospectus or final prospectus contained therein or any such

amendments or supplements thereto, or (B) offers or sales effected by or on behalf of

such Indemnitee "by means of' (as defined in Rule 159A) a "free writing prospectus" (as

defined in Rule 405) that was not authorized in writing by the Company.

Oi) Ifthe indemnification provided for in Section 4.5(g)(i) is unavailable to an

Indemnitee with respect to any losses, claims, damages, actions, liabilities, costs or

expenses referred to therein or is insufficient to hold the Indemnitee harmless as

contemplated therein, then the Company, in lieu of indemnifying such Indemnitee, shall

contribute to the amount paid or payable by such Indemnitee as a result of such losses,

claims, damages, actions, liabilities, costs or expenses in such proportion as is appropriate

to reflect the relative fault of the Indemnitee, on the one hand, and the Company, on the

other hand, in connection with the statements or omissions which resulted in such losses,

claims, damages, actions, liabilities, costs or expenses as well as any other relevant

equitable considerations. The relative fault of the Company, on the one hand, and ofthe

Indemnitee, on the other hand, shall be determined by reference to, among other factors,

whether the untrue statement of a material fact or omission to state a material fact relates

to information supplied by the Company or by the Indemnitee and the parties' relative

intent, knowledge, access to information and opportunity to correct or prevent such

statement or omission; the Company and each Holder agree that it would not be just and

equitable if contribution pursuant to this Section 4.5(g)(ii) were determined by pro rata

allocation or by any other method of allocation that does not take account of the equitable

.considerations referred to in Section 4.5(g)(i). No Indemnitee guilty of fraudulent

misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be

entitled to contribution from the Company if the Company was not guilty of such

fraudulent misrepresentation.

(h) Assignment ofRegistration Rights. The rights of the Investor to registration of

Registrable Securities pursuant to Section 4.5(a) may be assigned by the Investor to a transferee

or assignee ofRegistrable Securities with a liquidation preference or, in the case of Registrable

Securities other than Preferred Stock, a market value, no less than an amount equal $200 million;

provided, however, the transferor shall, within ten days after such transfer, furnish to the

Company written notice ofthe name and address of such transferee or assignee and the number

and type of Registrable Securities that are being assigned. For purposes of this Section 4.5(h),

"market value" per share of Common Stock shall be the last reported sale price ofthe Common

Stock on the nationa] securities exchange on which the Common Stock is listed or admitted to

trading on the last trading day prior to the proposed transfer, and the "market value" for the

Warrant (0. any portion thereof) shall be the market value per share of Common Stock into

which the Warrant (or such portion) is exercisable less the exercise price per share.

(i) Clear Market. With respect to any underwritten offering ofRegistrable Securities

by the Investor or other Holders pursuant to this Section 4.5, the Company agrees not to effect

(other than pursuant to such registration or pursuant to a Special Registration) any public sale or

distribution, or to file any Shelf Registration Statement (other than such registration or a Special

Registration) covering, in the case of an underwritten offering of Common Stock or Warrants,

26

(NY) 07865JOO2ffARP/SPA.doc
any of its equity securities or, in the case of an underwritten offering of Preferred Stock, any

preferred stock of the Company, or, in each case, any securities convertible into or exchangeable

or exercisable for such securities, during the period not to exceed ten days prior and 60 days

following the effective date of such offering or such longer period up to 90 days as may be

requested by the managing underwriter for such underwritten offering. The Company also

agrees to cause such of its directors and senior executive officers to execute and deliver

customary lock-up agreements in such form and for such time period up to 90 days as may be

requested by the managing underwriter. "Special Registration" means the registration of (A)

equity securities and/or options or other rights in respect thereof solely registered on Form $-4 or

Form S-8 (or successor form) or (B) shares of equity securities and/or options or other rights in

respect thereof to be offered to directors, members of management, employees, consultants,

customers, lenders or vendors of the Company or Company Subsidiaries or in connection with

dividend reinvestment plans.

(j) Rule 144; Rule 144A. With a view to making available to the Investor and Holders

the benefits of certain rules and regulations ofthe SEC which may permit the sale of the

Registrable Securities to the public without registration, the Company agrees to use its

reasonable best efforts to:

(i) make and keep public information available, as those terms are understood

and defined in Rule 144(c)(l) or any similar or analogous rule promulgated under the

Securities Act, at all times after the Signing Date;

(ii) (A) file with the SEC, in a timely manner, an reports and other documents

required of the Company under the Exchange Act, and (B) if at any time the Company is

not required to file such reports, make available, upon the request of any Holder, such

information necessary to permit sales pursuant to Rule 144A (including the information

required by Rule 144A(d)(4) under the Securities Act);

(iii) so long as the Investor or a Holder owns any Registrable Securities,

furnish to the Investor or such Holder forthwith upon request: a written statement by the

Company as to its compliance with the reporting requirements of Rule 144 under the

Securities Act, and of the Exchange Act; a copy of the most recent annual or quarterly

report of the Company; and such other reports and documents as the Investor or Holder

may reasonably request in availing itself of any rule or regulation of the SEC allowing it

to sell any such securities to the public without registration; and

(iv) take such further action as any Holder may reasonably request, all to the

extent required from time to time to enable such Holder to sell Registrable Securities

without registration under the Securities Act.

(k) As used in this Section 4.5, the following tenns shall have the following respective

meanings:

27

(NY) 078651OO2ffARP/SPA.dac
(i) "Holder" means the Investor and any other holder of Registrable

Securities to whom the registration rights conferred by this Agreement have been

transferred in ~ompliance with Section 4.5(h) hereof.

(ii) "Holders' Counsel" means one counsel for the selling Holders chosen by

Holders holding a majority interest in the Registrable Securities being registered.

(iii) "Register," "registered," and "registration" shall refer to a registration

effected by preparing and (A) filing a registration statement in compliance with the

Securities Act and applicable rules and regulations thereunder, and the declaration or

ordering of effectiveness of such registration statement or (B) filing a prospectus and/or

prospectus supplement in respect of an appropriate effective registration statement on

Form S-3.

(iv) "Registrable Securities" means (A) all Preferred Stock, (B) the Warrant

(subject to Section 4.5(p)) and (C) any equity securities issued or issuable directly or

indirectly with respect to the securities referred to in the foregoing clauses ({A) or (B) by

way of conversion, exercise or exchange thereof, including the Warrant Shares, or share

dividend or share split or in connection with a combination ofshares, recapitalization,

reclassification, merger, amalgamation, anangement, consolidation or other

reorganization, provided that, once issued, such securities will not be Registrable

Securities when (1) they are sold pursuant to an effective registration statement under the

Securities Act, (2) except as provided below in Section 4.5(0), they may be sold pursuant

to Rule 144 without limitation thereunder on volume or manner of sale, (3) they shall

have ceased to be outstanding or (4) they have been sold in a private transaction in which

the transferor's rights under this Agreement are not assigned to the transferee of the

securities. No Registrable Securities may be registered under more than one registration

statement at anyone time.

(v) "Registration Expenses" mean all expenses incurred by the Company in

effecting any registration pursuant to this Agreement (whether or not any registration or

prospectus becomes effective or final) or otherwise complying with its obligations under

this Section 4.5. including aU registration, filing and listing fees, printing expenses, fees

and disbursements of counsel for the Company, blue sky fees and expenses, expenses

incurred in connection with any "road show", the reasonable fees and disbursements of

Holders' Counsel. and expenses of the Company's independent accountants in

connection with any regular or special reviews or audits incident to or required by any

such registration, but shall not include Selling Expenses.

(vi) "Rule 144", "Rule 144A", "Rule 159A", "Rule 405" and "Rule 415"

mean, in each case. such rule promulgated under the Securities Act (or any successor

provision), as the same shall be amended from time to time.

(vii) "Selling Expenses" mean all discounts, selling commissions and stock

transfer taxes applicable to the sale ofRegistrable Securities and fees and disbursements

28

{NY} 0'78651OO2ffARPISPA.doc
of counsel for any Holder (other than the fees and disbursements of Holders' Counsel

included in Registration Expenses).

(1) At any time, any holder of Securities (including any Holder) may elect to forfeit its

rights set forth in this Section 4.5 from that date forward; provided, that a Holder forfeiting such

rights shall nonetheless be entitled to participate under Section 4.5(a)(iv) - (vi) in any Pending

Underwritten Offering to the same extent that such Holder would have been entitled to if the

holder had not withdrawn; and provided, further, that no such forfeiture shall terminate a

Holder's rights or obligations under Section 4.5(f) with respect to any prior registration or

Pending Underwritten Offering. "Pending Underwritten Offering" means, with respect to any

Holder forfeiting its rights pursuant to this Section 4.5(1), any underwritten offering of

Registrable Securities in which such Holder has advised the Company of its intent to register its

Registrable Securities either pursuant to Section 4.5(a)(ii) or 4.5(a)(iv) prior to the date of such

Holder's forfeiture.

(m) Specific Performance. The parties hereto acknowledge that there would be no

adequate remedy at law if the Company fails to perform any of its obligations under this Section

4.5 and that the Investor and the Holders from time to time may be irreparably harmed by any

such failure, and accordingly agree that the Investor and such Holders, in addition to any other

remedy to which they may be entitled at law or in equity, to the fullest extent permitted and

enforceable under applicable law shall be entitled to compel specific performance of the

obligations of the Company under this Section 4.5 in accordance with the terms and conditions

of this Section 4.5.

(n) No Inconsistent Agreements. The Company shall not, on or after the Signing Date,

enter into any agreement with respect to its securities that may impair the rights granted to the

Investor and the Holders under this Section 4.5 or that otherwise conflicts with the provisions

hereof in any manner that may impair the rights granted to the Investor and the Holders under

this Section 4.5. In the event the Company has, prior to the Signing Date, entered into any

agreement with respect to its securities that is inconsistent with the rights granted to the Investor

and the Holders under this Section 4.5 (including agreements that are inconsistent with the order

of priority contemplated by Section 4.5(a)(vi) or that may otherwise conflict with the provisions

hereof, the Company shall use its reasonable best efforts to amend such agreements to ensure

they are consistent with the provisions ofthis Section 4.5.

(0) Certain Offerings by the Investor. In the case of any securities held by the Investor

that cease to be Registrable Securities solely by reason of clause (2) in the definition of

"Registrable Securities," the provisions of Sections 4.5(a)(ii), clauses (iv), (ix) and (x)-(xii) of

Section 4.5(c), Section 4.5(g) and Section 4.5(i) shall continue to apply until such securities

otherwise cease to be Registrable Securities. In any such case, an "underwritten" offering or

other disposition shall include any distribution ofsuch securities on behalf ofthe Investor by one

or more broker-dealers, an "underwriting agreement" shall include any purchase agreement

entered into by such broker-dealers, and any "registration statement" or "prospectus" shall

include any offering document approved by the Company and used in connection with 'such

distribution.

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(p) Registered Sales of the Warrant. The Holders agree to sell the Warrant or any

portion thereof under the Shelf Registration Statement only beginning 30 days after notifying the

Company of any such sale, during which 30-day period the Investor and all Holders of the

Warrant shall take reasonable steps to agree to revisions to the Warrant to permit a public

distribution of the Warrant, including entering into a warrant agreement and appointing a warrant

agent.

4.6 Voting ofWarrant Shares. Notwithstanding anything in this Agreement to the

contrary, the Investor shall not exercise any voting rights with respect to the Warrant Shares.

4.7 Depositary Shares. Upon request by the Investor in connection with a proposed

transfer of the Preferred Stock, the Company shall promptly enter into a depositary arrangement,

pursuant to customary agreements reasonably satisfactory to the Investor and with a depositary

reasonably acceptable to the Investor, pursuant to which the Preferred Stock may be deposited

and depositary shares, each representing a fraction of a Preferred Stock as specified by the

Investor, may be issued. From and after the execution of any such depositary arrangement, and

the deposit of any Preferred Stock pursuant thereto, the depositary shares issl,led pursuant .thereto

shall be deemed "Preferred Stock" and, as applicable, "Registrable Securities" for purposes of

this Agreement.

4.8 Restriction on Dividends and Repurchases.

(a) Prior to the earlier of (x) the fifth anniversary of the Closing Date and (y) the date

on which the Preferred Stock has been redeemed in whole or the Investor has transferred all of

the Preferred Stock to third parties which are not Affiliates of the Investor, neither the. Company

nor any Company Subsidiary shall, without the consent of the Investor:

(i) declare or pay any dividend or make any distribution on the Common

Stock (other than (A) regular quarterly cash dividends of not more than the amount of the

last quarterly cash dividend per share declared or, if lower, publicly announced an

intention to declare, on the Common Stock prior to November 25, 2008, as adjusted for

any stock split, stock dividend, reverse stock split, reclassification or similar transaction,

(B)) dividends p~yable solely in shares of Common Stock and (C) dividends or

distributions of rights or Junior Stock in connection with a stockholders' rights plan); or

(ii) redeem, purchase or acquire any shares of Common Stock or other capital

stock or other equity securities of any kind ofthe Company, or any trust preferred

securities issued by the Company or any Affiliate ofthe Company, other than (A)

redemptions. purchases or other acquisitions of the Preferred Stock, (B) redemptions.

purchases or other acquisitions of shares of Common Stock or other Junior Stock, in each

case in this clause (B) in connection with the administration of any employee benefit plan

in the ordinary course of business (including purchases to offset the Share Dilution

Amount (as defined below) pursuant to a publicly announced repurchase plan) and

consistent with past practice; provided that any purchases to offset the Share Dilution

Amount shall in no event exceed the Share Dilution Amount, (C) any redemption or

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(NY) 078651OO2fTARPISPA.doc
repurchase of rights pursuant to any stockholders' rights plan, (D) the acquisition by the

Company or any of the Company Subsidiaries of record ownership in Junior Stock or

Parity Stock for the beneficial ownership of any other persons (other than the Company

or any other Company Subsidiary), including as trustees or custodians (the "Permitted

Repurchases"), and (E)the exchange or conversion ofJunior Stock for or into other

Junior Stock or of Parity Stock or trust preferred securities for or into other Parity Stock

(with the same or lesser aggregate liquidation amount) or Junior Stock, in each case set

forth in this clause (E), solely to the extent required pursuant to binding contractual

agreements entered into prior to the Signing Date or any subsequent agreement for the

accelerated exercise, settlement or exchange thereof for Common Stock. "Share

Dilution Amount" means the increase in the number of diluted shares outstanding

(determined in accordance with GAAP, and as measured from the date of the Company's

most recently filed Company Financial Statements prior to the Closing Date) resulting

from the grant, vesting or exercise of equity-based compensation to employees and

equitably adjusted for any stock split, stock dividend, reverse stock split, reclassification

or similar transaction.

(b) Until such time as the Investor ceases to own any Preferred Stock, the Company

shall not repurchase any Preferred Stock from any holder thereof, whether by means of open

market purchase, negotiated transaction, or otherwise, other than Permitted Repurchases, unless

it offers to repurchase a ratable portion of the Preferred Stock then held by the Investor on the

same terms and conditions.

(c) "Junior Stock" means Common Stock, the Series C Preferred Stock (after the

Company's stockholders approve the amendment described in Section 3.1 (b) to the Charter to

have the Preferred Stock rank senior to the Series C Preferred Stock) and any other class or

series of stock of the Company the terms of which expressly provide that it ranks junior to the

Preferred Stock as to dividend rights and/or as to rights on liquidation, dissolution or winding up

oftbe Company. "Parity Stock" means the Series C Preferred Stock (before the Company's

stockholders approve the Charter amendment referred to above) and any class or series of stock

of the Company the terms of which do not expressly provide that such class or series will rank

senior or junior to the Preferred Stock as to dividend rights and/or as to rights on liquidation,

dissolution or winding up of the Company (in each case without regard to whether dividends

accrue cumulatively or non-cumulatively).

4.9 Repurchase ofInvestor Securities.

(a) Following the redemption in whole of the Preferred Stock held by the Investor or

the Transfer by the Investor of all of the Preferred Stock to one or more third parties not

affiliated with the Investor and so long as the Investor does not Control the Company, the

Company may repurchase, in whole or in part, at any time any other equity or debt securities of

the Company owned by the Investor or the Warrant or Warrant Shares and then held by the

Investor, upon notice given as provided in clause (b) below, at the Fair Market Value of the

equity security. For the avoidance of doubt, while there is Board of Directors control (or the

potential to gain Board of Directors control as a result of existing contractual rights) by the

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Investor (or any affiliate ofthe Investor), the Company may not exercise its rights under this

Section 4.9.

(b) Notice of every repurchase of equity securities of the Company held by the Investor

shall be given at the address and in the manner set forth for such party in Section 5.6. Each

notice of repurchase given to the Investor shall state: (i) the number and type of securities to be

repurchased, (ii) the Board of Directors' determination of Fair Market Value of such securities

and (iii) the place or places where certificates representing such securities are to be surrendered

for payment of the repurchase price. The repurchase of the securities specified in the notice shall

occur as soon as practicable following the determination of the Fair Market Value of the .

securities.

(c) As used in this Section 4.9, the following terms shall have the following respective

meanings:

(i) "Appraisal Procedure" means a procedure whereby two independent

appraisers, one chosen by the Company and one by the Investor, shall mutually agree

upon the Fair Market Value. Each party shall deliver a notice to the other appointing its

appraiser within 10 days after the Appraisal Procedure is invoked. If within 30 days after

appointment of the two appraisers they. are unable to agree upon the Fair Market Value, a

third independent appraiser shall be chosen within 10 days thereafter by the mutual

consent of such first two appraisers. The decision ofthe third appraiser so appointed and

chosen shall be given within 30 days after the selection ofsuch third appraiser. Ifthree

appraisers shall be appointed and the determination of one appraiser is disparate from the

middle determination by more than twice the amount by which the other determination is

disparate from the middle determination, then the determination of such appraiser shall

be excluded, the remaining two determinations shall be averaged and such average shall

be binding and conclusive upon the Company and the Investor; otherwise, the average of

all three determinations shall be binding upon the Company and the Investor. The costs

of conducting any Appraisal Procedure shall be borne by the Company.

(ii) "Fair Market Value" means, with respect to any security, the fair market

value of such security as determined by the Board of Directors, acting in good faith in

reliance on an opinion of a nationally recognized independent investment banking firm

retained by the Company for this purpose and certified in a resolution to the Investor. If

the Investor does not agree with the Board of Directors' determination, it may object in

writing within 10 days of receipt of the Board of Directors' determination. In the event of

such an objection, an authorized representative of the Investor and the chief executive

officer of the Company shall promptly meet to resolve the objection and to agree upon

the Fair Market Value. If the chief executive officer and the authorized representative are

unable to agree on the Fair Market Value during the lO-day period following the delivery

of the Investor's objection, the Appraisal Procedure may be invoked by either party to

determine the Fair Market Value by delivery of a written notification thereof not later

than the 30th day after delivery ofthe Investor's objection.

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(iii) "Contro)" means the power to direct the management and policies of the

Company, directly or indirectly, whether through the ownership of voting securities, by

contract, by the power to control the Board of Directors or otherwise.

4.10 Executive Compensation.

(a) Until such time as the Investor ceases to own any debt or equity securities of the

Company acquired pursuant to this Agreement or the Warrant, the Company shall take aU

necessary action to ensure that its Benefit Plans with respect to the Senior Executive Officers

comply in all respects with Section 111 (b) of the EESA, including the provisions for

Systemically Significant Failing Institutions, as implemented by any guidance or regulation

thereunder, including Notice 2008·PSSFI, that has been issued and is in effect as of the Closing

Date, including but not limited to provisions prohibiting severance payments to Senior Executive

Officers, and shall not adopt any new Benefit Plan with respect to its Senior Executive Officers

that does not comply therewith. "Senior Executive Officers" means the Company's "senior

executive officers" as defined in subsection 111(b)(3) of the EESA and regulations issued

thereunder, including the rules set forth in 31 CFR Part 30, that have been issued and are in

effect as of the Closing Date.

(b) (1) In addition, the Company shaH, until such, time as the Investor ceases to own

any debt or equity securities of the Company acquired pursuant to this Agreement or the Warrant,

take aU necessary action to limit any "golden parachute payments" to the employees of the

Company and the Company Subsidiaries who as of the Closing Date participate in the

Company's Senior Partners Plan (other than the Senior Executive Officers) (the "Senior

Partners") to the amounts permitted by the regulations relating to participants in the EESA

Capita) Purchase Program and the guidelines and rules relating thereto, including the rules set

forth in 31 CFR Part 30, that have been issued and are in effect as of the Closing Date, as if such

Senior Partners were Senior Executive Officers for purposes of the EESA (except that equity

denominated awards settled solely in equity shall not be included in such limit on "golden

parachute payments" to Senior Partners).

(2) In furtherance of the Company's commitment to limit golden parachute

payments to Senior Partners as set forth in Section 4.l0(b)(1), and to ensure compliance

with the provisions ofthe EESA Capital Purchase Program and the guidelines and

regulations relating thereto applicable to Senior Partners pursuant to Section 4.IO(b)(1), it

is further agreed that the Company shaH take all necessary action to ensure that the sum

of (A) a Senior Partner's annual bonus for 2009, (B) all retention payments paid or

payable to such Senior Partner under any retention arrangement between the Senior

Partner and the Company for any period ending on or prior to March 31,2010 and

(C) any and all amounts paid or payable to such Senior Partner in connection with the

termination of such Senior Partner's employment prior to March 31, 20JO which would

be taken into account in applying the compensation limitation under Section 4.1O(b)(1)

above, other than any payments pursuant to outstanding awards under the Company's

Senior Partners Plan, shall not exceed 3.5 times the sum of such Senior Partner's base

salary and target annual bonus for 2008. For this purpose, actual annual bonus for 2009

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(NY) 078651OO2fTARP/sPA,doc
and target annual bonus for 2008 will include supplemental bonus andqu3rterly cash

payments under the Company's historic quarterly bonus program consistent with, and in

amounts not exceeding, past practice.

(3) Notwithstanding the other provisions of this Section 4.l0(b), the

Company's obligations under this Section 4.1O(b) shall be on a best efforts basis with

respect to the Senior Partners who are not U.S.-based to the extent of its existing Benefit

Plans. Without derogation of the condition set forth in Section 1.2(d)(v), the Company

shall use its best efforts to obtain from all the Senior Partners and deliver to the Investor

prior to the Closing or as promptly as possible thereafter a waiver in the form attached

hereto as Annex B-1.

(c) Unless the Investor ceases to own any debt or equity securities of the Company

acquired pursuant to this Agreement or the Warrant, the Company shall take all necessary action

to ensure that the annual bonus pools payable to the Senior Executive Officers and the Senior

Partners in respect of each of 2008 and 2009 shall not exceed the average of the annual bonus

pools paid to the Senior Executive Officers and the Senior Partners for 2006 and 2007 (in each

case exclusive of the Company's historic quarterly bonus program including but not limited to

supplemental bonus and quarterly cash payments, the amount of which will not increase for any

participant) and subject to appropriate adjustment for new hires and departures.

(d) For the reasons set forth in Section 4.1O(b)(2) above and in furtherance thereof, the

Company shall, as soon as practicable, take all necessary action to amend its Executive

Severance Plan, effective not later than March 11,2010, to require that the benefits thereunder

will be reduced by any remuneration attributable to a participant's subsequent employment

during the relevant severance period.

(e) The Company confirms that none of (i) the proceeds of the Purchase Price nor

(ii) the funds provided to the Company under the Credit Agreement (collectively "the Funds"),

shall be used to pay annual bonuses, or other future cash performance awards to executives of

the Company or Senior Partners. The parties desire that this confirmation be auditable and agree

that there are a number of appropriate methods for verifying this confirmation (particularly in

light of expected business changes at the Company). Until the date that any annual bonuses in

respect of 2009 are paid, it is agreed that the test for the foregoing will be that, at the time when

any annual bonuses or cash performance awards granted after the date of this Agreement are paid

to executive officers or Senior Partners, the Company will have received aggregate dividends,

distributions and other payments from its subsidiaries subsequent to September 16, 2008 greater

than the aggregate amount of such annual bonuses, such cash performance awards and amounts

paid pursuant to AIG's historic quarterly bonus program (including but not limited to

supplemental bonus and quarterly cash payments, the amount of which will not increase for any

participant) paid to executive officers and Senior Partners subsequent to that date. At and after

the date that any annual bonuses in respect of 2009 are paid, the test for the foregoing

confirmation will be that, at the time when any annual bonuses or cash performance awards

granted after the date of this Agreement are vested or otherwise earned by executive officers or

Senior Partners, the aggregate adjusted net income for the relevant year (being the year in which

34

(NY) 07865<W2IfARP/SPA.doc
or in respect of which such bonuses or awards are vested or so eamed) of the insurance company

subsidiaries of the Company included for such year in the consolidated financial statements of

the Company, excluding any such adjusted net income that was dividended or otherwise

distributed to the Company and taken into account in satisfying the test under the prior sentence,

shall exceed the aggregate amount of such annual bonuses, such cash performance awards and

amounts pursuant to AIG's historic quarterly bonus program (including but not limited to

supplemental bonus and quarterly cash payments, the amount of which will not increase for any

participant), in each case vested or otherwise earned in or in respect of such year. Each party

agrees to negotiate in good faith and promptly at the request of the other to develop additional or

alternative appropriate formulations to test for this confirmation.

(f) The Company confirms that none of the Funds shall be used to pay any electively

deferred compensation in respect of or otherwise resulting from the termination of the deferred

compensation plans by the Company or the Company subsidiaries as described in Item 5.02 of

the Company's Current Report on Form 8-K dated November 18,2008.

4.11 Restrictions on Lobbying. Until such time as the Investor ceases to own any

Preferred Stock, the Company shall continue to maintain and implement its comprehensive

written policy on lobbying, governmental ethics and political activity and distribute such policy

to all Company employees and lobbying firms involved in .any such activity. Any material

amendments to such policy shall require the prior written consent of the Investor until the

Investor no longer owns any Preferred Stock, and any material deviations from such policy,

whether in contravention thereof or pursuant to waivers provided for thereunder, shall promptly

be reported to the Investor. Such policy shall, at a minimum, (i) require compliance with all

applicable law; (ii) apply to the Company, the Company Subsidiaries and affiliated foundations;

(iii) govern (a) the provision of items of value to any government officials; (b) lobbying and (c)

political activities and contributions; and (iv) provide for (a) internal reporting and oversight and

(b) mechanisms for addressing non-compliance with the policy.

4.12 Restrictions on Expenses. Until such time as the Investor ceases to own any

Preferred Stock, the Company shall continue to maintain and implement its comprehensive

written policy on corporate expenses and distribute such policy to all Company employees. Any

material amendments to such policy shall require the prior written consent of the Investor until

such time as the Investor no longer owns any Preferred Stock, and any material deviations from

such policy, whether in contravention thereof or pursuant to waivers provided for thereunder,

shall promptly be reported to the Investor. Such policy shall, at a minimum: (i) require

compliance with an applicable law; (ii) apply to the Company and the Company Subsidiaries; (iii)

govern (a) the hosting, sponsorship or other payment for conferences and events, (b) the use of

corporate aircraft, (c) travel accommodations and expenditures, (d) consulting arrangements with

outside service providers, (e) any new lease or acquisition ofreal estate, (f) expenses relating to

office or facility renovations or relocations and (g) expenses relating to entertainment or holiday

parties; and (iv) provide for (a) internal reporting and oversight and (b) mechanisms for

addressing non-compliance with the policy.

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(NY) 078651OO2ITARPISPA.doc
4.13 Risk Management Committee. Within 30 days ofthe Closing Date, and until such

time as the Investor ceases to own any Preferred Stock, the Warrant or any other equity or debt

securities of the Company, the Company shall establish and maintain a risk management

committee of the Board of Directors that will oversee the major risks involved in the Company's

business operations and review the Company's actions to mitigate and manage those risks.

4.14 Dividend Rate Adjustment. The dividend rate on the PrefelTed Stock beneficially

owned at the time by the Investor is subject to adjustment in the sole discretion of the Secretary

of the Department of the Treasury in light of. inter alia, then-prevailing economic conditions and

the financial condition of the Company, with the objective of protecting the U.S. taxpayer.

Article 5

Miscellaneous

5.1 Termination. This Agreement may be terminated at any time prior to the Closing:

(a) by either the Investor or the Company if the Closing shall not have occurred by the

30th calendar day following the Signing Date; provided, however, that in the event the Closing

has not occurred by such 30th calendar day, the parties will consult in good faith to determine

whether to extend the term of this Agreement, it being understood that the parties shall be

required to consult only until the fifth day after such 30th calendar day and not be under any

obligation to extend the term ofthis Agreement thereafter; provided, further, that the right to

terminate this Agreement under this Section 5.1(a) shall not be available to any party whose

breach of any representation or warranty or failure to perform any obligation under this

Agreement shall have caused or resulted in the failure of the Closing to occur on or prior to such

date; or

(b) by either the Investor or the Company in the event that any Governmental Entity

shall have issued an order, decree or ruling or taken any other action restraining, enjoining or

otherwise prohibiting the transactions contemplated by this Agreement and such order, decree,

ruling or other action shall have become final and nonappealable; or

(c) by the mutual written consent ofthe Investor and the Company.

In the event of termination of this Agreement as provided in this Section 5.1, this Agreement

shall forthwith become void and there shall be no liability on the part of either party hereto

except that nothing herein shall relieve either party from liability for any breach of this

Agreement.

5.2 Survival ofRepresentations and Warranties. All covenants and agreements, other

than those which by their terms apply in whole or in part after the Closing. shall terminate as of

the Closing. The representations and warranties of the Company made herein or in any

certificates delivered in connection with the Closing shall survive the Closing without limitation.

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(NY) 0786SJ()()2!TARP/SPA.doc
5.3 Amendment. No amendment of any provision of this Agreement will be effective

unless made in writing and signed by an officer or a duly authorized representative of each party;

provided that the Investor may unilaterally amend any provision of this Agreement to the extent

required to comply with any changes after the Signing Date in applicable federal statutes. No

failure or delay by any party in exercising any right, power or privilege hereunder shall operate

as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further

exercise of any other right, power or privilege. The rights and remedies herein provided shall be

cumulative of any rights or remedies provided by law.

5.4 Waiver ofConditions. The conditions to each party's obligation to consummate

the Purchase are for the sole benefit of such party and may be waived by such party in whole or

in part to the extent permitted by applicable law. No waiver will be effective unless it is in a

writing signed by a duly authorized officer of the waiving party that makes express reference to

the provision or provisions subject to such waiver.

5.5 Governing Law: Submission to Jurisdiction, Etc. This Agreement, and the rights

and obligations of the parties hereunder, shall be govemed by, and construed and interpreted in

accordance with, United States federal law and not the law of any State. To the extent that a

court looks to the laws of any State to determine or define the United States federal law, it is the

intention of the parties hereto that such cO]Jrt shall look only to the laws of the State of New

York without regard to the rules of conflicts of laws. Each of the parties hereto agrees (a) to

submit to the exclusive jurisdiction and venue of the United States District Court for the District

of Columbia and the United States Court of Federal Claims for any and all actions, suits or

proceedings arising out of or relating to this Agreement or the Warrant or the transactions

contemplated hereby or thereby, and (b) that notice may be served upon (i) the Company at the

address and in the manner set forth for notices to the Company in Section 5.6 and (ii) the

Investor in accordance with federal law. To the extent permitted by applicable law, each ofthe

parties hereto hereby unconditionally waives trial by jury in any legal action or proceeding

relating to this Agreement or the Warrant or the transactions contemplated hereby or thereby.

5.6 Notices. Any notice, request, instruction or other document to be given hereunder

by any party to the other will be in writing and will be deemed to have been duly given (a) on the

date of delivery if delivered personally, or by facsimile, upon confirmation of receipt. or (b) on

the second business day following the date of dispatch if delivered by a recognized next day

courier service. All notices to the Company shall be delivered to the address set forth below, or

pursuant to such other instruction as may be designated in writing by the Company to the

Investor. All notices to the Investor shall be delivered as set forth below, or pursuant to such

other instructions as may be designated in writing by the Investor to the Company.

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(NY) 0786S.oo2fTARPISPA.doc
If to the Investor:

United States Department of the Treasury

1500 Pennsylvania Avenue, NW, Room 2312

Washington, D.C. 20220

Attention: Assistant General Counsel (Banking and Finance)

Facsimile: (202) 622-1974

If to the Company:

American International Group, Inc.

70 Pine Street, New York, New York 10270

Attention: General Counsel

Facsimile: (212) 785-2175

Telephone: (212) 770-7000

with a copy to:

Sullivan & Cromwell LLP

125 Broad Street, New York, New York 10004

Attention: Robert W. Reeder Ill, Michael M. Wiseman

Telephone: (212) 558-4000

5.7 Definitions.

(a) When it reference is made in this Agreement to a subsidiary of a person, the term

"subsidiary" means any corporation, partnership, joint venture, limited liability company or

other entity (x) of which such person or a subsidiary of such person is a general partner or (y) of

which a majority of the voting securities or other voting interests, or a majority of the securities

or other interests of which having by their terms ordinary voting power to elect a majority of the

board of directors or persons performing similar functions with respect to such entity, is directly

or indirectly owned by such person and/or one or more subsidiaries thereof; provided that no

Fund shall be a subsidiary for purposes of this Agreement.

(b) The term "Fund" means any investment vehicle managed by the Company or an

Affiliate of the Company and created in the ordinary course of the Company's asset management

business for the purpose of selling Equity Interests in such investment vehicle to third parties.

"Equity Interests" means shares of capital stock, partnership interests, membership interests in a

limited liability company, beneficial interests in a trust or other equity interests in any entity, and

any option, warrant or other right entitling the holder thereof to purchase or otherwise acquire

any such equity interest.

(c) The term "Affiliate" means, with respect to any person, any person directly or

indirectly controlling, controlled by or under common control with, such other person. For

purposes of this definition, "control" (including, with correlative meanings. the terms "controlled

38

(NY) 0711651OO2IfARPISPA,doc
by" and "under common control with") when used with respect to any person, means the

possession, directly or indirectly, of the power to cause the direction of management and/or

policies of such person, whether through the ownership of voting securities by contract or

otherwise.

(d) The terms "knowledge of the Company" or "Company's knowledge" mean the

actual knowledge after reasonable and due inquiry of the "officers" (as such term is defined in

Rule 3b-2 under the Exchange Act, but excluding any Vice President or Secretary) of the

Company.

5.8 Assignment. Neither this Agreement nor any right, remedy, obligation nor

liability arising hereunder or by reason hereof shall be assignable by any party hereto without the

prior written consent of the other party, and any attempt to assign any right, remedy, obligation

or liability hereunder without such consent shall be void, except (a) an assignment, in the case of

a Business Combination, as defined below, where such party is not the surviving entity, or a sale

of substantially all of its assets, to the entity which is the survivor of such Business Combination

or the purchaser in such sale and (b) as provided in Section 4.5. "Business Combination"

means merger, consolidation, statutory share exchange or similar transaction that requires the

approval of the Company's stockholders.

5.9 Severability. If any provision of this Agreement or the Warrant, or the application

thereof to any person or circumstance, is determined by a court of competent jurisdictionto be

invalid, void or unenforceable, the remaining provisions hereof, or the application of such

provision to persons or circumstances other than those as to which it has been held invalid or

unenforceable, will remain in full force and effect and shall in no way be affected, impaired or

invalidated thereby, so long as the economic or legal substance of the transactions contemplated

hereby is not affected in any manner materially adverse to any party. Upon such determination,

the parties shall negotiate in good faith in an effort to agree upon a suitable and equitable

substitute provision to effect the original intent of the parties.

5.10 Entire Agreement. This Agreement (including the Annexes and Schedules hereto)

constitutes the entire agreement, and supersedes all other prior agreements, understandings,

representations and warranties, both written and oral, between the parties, with respect to the

subject matter hereof.

5.11 No Third Party Beneficiaries. Nothing contained in this Agreement, expressed or

implied, is intended to confer upon any person or entity other than the Company and the Investor

any benefit, right or remedies, except that the provisions of Section 4.5 shall inure to the benefit

of the persons referred to in that Section.

[Signature Page Follows]

39

(NY) 0786SIOOUTARP/SPA.doc
In witness whereof, this Agreement has been duly executed and delivered by the duly

authorized representatives ofthe parties hereto as ofthe date written below.

AMERICAN INTERNATIONAL

GROUP, INC.

By: N?~~Lh{f'

Title:

UNITED STATES DEPARTMENT OF

THE TREASURY

By:

Name:

Title:

Date: November 25,2008

(NY) 0786510021TARP/SPA.doc

In witness whereof, this Agreement has been duly executed and delivered by the duly

authorized representatives ofthe parties hereto as ofthe date written below.

AMERICAN INTERNATIONAL

GROUP, INC.

By:

Name:

Title:

UNITED STATES DEPARTMENT OF

THE TREASURY

By: ~£'... Name: }U££e ~S~~(

Title: /JJru,.... A'lU'TA-:f ~C~~.,

f'P,<.J14t>Jt-1/IL s:r,to 41(,.,..,.,

zr Date: November _, 2008

(NY) C7S651002ffARP/SPA.doc

SCHEDULE A

ADDITIONAL TERMS AND CONDITIONS

Company Information:

Name of the Company: American International Group, Inc.

Corporate or other organizational form: Corporation

Jurisdiction of Organization: Delaware

Terms of the Purchase:

Series of Preferred Stock Purchased: Series D Fixed Rate Cumulative Perpetual

Preferred Stock

Per Share Liquidation Preference of Preferred Stock: $10,000

Number of Shares of Preferred Stock Purchased: 4,000,000

Dividend Payment Dates on the Preferred Stock: "February 1, May 1. August 1 and

November 1

Number of Warrant Shares:

Exercise Price of the Warrant:

Closing:

53,798,766

Initially $2.50 per share of Common Stock

Location of Closing:

Time of Closing:

Date of Closing:

(NY) 078651OO2ITARP/SPA.doc

Sullivan & Cromwell LLP

125 Broad Street

New York, NY 10004

3:00 p.m., New York time

November 25. 2008
SCHEDULEB

CAPITALIZATION

Capitalization Date: October 31, 2008

Common Stock

Par value: $2.50 per share

Total Authorized: 5,000,000,000

Outstanding: 2,689,938,313

Subject to warrants, options, convertible securities, etc.: Up to 154,738,080 shares are

reserved for issuance pursuant to the Purchase Contract Agreement between the

Company and The Bank of New York, as Purchase Contract Agent, dated as of May 16,

2008

Reserved for benefit plans and other issuances: 169,420,587

Remaining authorized but unissued: 2,310,061,687

Shares issued after Capitalization Date (other than pursuant to warrants, options,

convertible securities, etc. as set forth above): 22,524

Serial Preferred Stock

Par value: $5.00 per share

Total Authorized: 6,000,000

Outstanding (by series): None

Reserved for issuance: 100,000

Remaining authorized but unissued: 5,900,000

(NY) 078651OO2ffARPISPA.doc
SCHEDULEC

LITIGATION

List any exceptions to the representation and warranty in Section 2.2(1) of the Securities

Purchase Agreement.

If none, please so indicate by checking the box: 1:8:1.

(NY) Q786SIOO2fJ"ARP/SPA.doc
SCHEDULED

COMPLIANCE WITH LAWS

List any exceptions to the representation and warranty in the second sentence of Section 2.2(m)

of the Agreement.

If none, please so indicate by checking the box: 1:8J.

List any exceptions to the representation and warranty in the last sentence of Section 2.2(m) of

the Securities Purchase Agreement.

If none, please so indicate by checking the box: [8J.

(NY) 078651OO2IfARPISPA.doc
SCHEDULEE

REGULATORY AGREEMENTS

List any exceptions to the representation and warranty in Section 2.2(s) of the Agreement.

If none, please so indicate by checking the box: [8J.

(NY) 078651OO2ITARP/sPA.doc
(NY) 01865JOO2ffARP/sPA.do<

FORM OF CERTIFICATE OF DESIGNATIONS

[SEE ATTACHED]

ANNEXA

•
CERTIFICATE OF DESIGNATIONS

OF

SERIES D FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK

OF

AMERICAN INTERNATIONAL GROUP, INC.

American International Group, Inc., a corporation organized and existing under the

General Corporation Law of the State of Delaware (the "Company"), hereby certifies that the

following resolution was adopted by the Board of Directors ofthe Company (the "Board of

Directors") as required by Section 151 of the General Corporation Law of the State of Delaware

at a meeting duly held on November 19,2008.

RESOLVED, that pursuant to the authority granted to and vested in the Board of

Directors in accordance with the provisions ofthe Restated Certificate of Incorporation, as

amended, the Board of Directors hereby creates a series of Serial Preferred Stock, par value

$5.00 per share, of the Company, and hereby states the designation and number of shares, and

fixes the voting and other powers, and the relative rights and preferences, and the qualifications,

limitations and restrictions thereof, as follows:

Series D Fixed Rate Cumulative Perpetual Preferred Stock:

Part 1. Designation and Number of Shares. There is hereby created out of the authorized

and unissued shares of serial preferred stock of the Company a series of preferred stock

designated as the "Series D Fixed Rate Cumulative Perpetual Preferred Stock" (the "Series D

Preferred Stock"). The authorized number of shares of the Series D Preferred Stock shall be

4,000,000. Such number ofshares may be decreased by resolution ofthe Board of Directors,

subject to the terms and conditions hereof; provided that no decrease shall reduce the number of

shares ofthe Series D Preferred Stock to a number less than the number of shares then

outstanding.

Part 2. Standard Provisions. The Standard Provisions contained in Annex A attached

hereto are incorporated herein by reference in their entirety and shall be deemed to be a part of

this Certificate of Designations to the same extent as ifsuch provisions had been set forth in full

herein.

Part. 3. Definitions. The following terms are used in this Certificate of Designations

(including the Standard Provisions in Annex A hereto) as defined below:

(a)

Company.

"Common Stock" means the common stock, par value $2.50 per share, ofthe

(b) "Convertible Preferred Stock" means the Series C Perpetual, Convertible,

Participating Preferred Stock of the·Company. The Convertible Preferred Stock shall be Parity
Stock; provided that the Convertible Preferred Stock shall be Junior Stock following the

effectiveness of an amendment to the Charter to allow the Series D Preferred Stock to rank

senior to the Convertible Preferred Stock as to dividends rights and/or rights upon the

liquidation, dissolution and winding up (the "Amendment").

(c) "Dividend Payment Date" means February 1, May 1, August 1 and November 1

of each year.

(d) "Junior Stock" means the Common Stock, the Convertible Preferred Stock

(following the Amendment) and any other class or series of stock ofthe Company the terms of

which expressly provide that it ranks junior to the Series D Preferred Stock as to dividend rights

and/or as to rights on liquidation, dissolution or winding up of the Company.

(e) «Liquidation Amount" means $10,000 per share of the Series D Preferred Stock.

(1) "Parity Stock" means the Convertible Preferred Stock (before the Amendment)

and any class or series ofstock of the Company (other than the Series D Preferred Stock) the

terms of which do not expressly provide that such class or series will rank senior or junior to the

Series D Preferred Stock as to dividend rights and/or as to rights on liquidation, dissolution or

winding up of the Company (in each case without regard to whether dividends accrue

cumulatively or non-cumulatively).

(h) "Signing Date" means November _,2008.

Part. 4. Certain Voting Matters. Whether the vote or consent of the holders of a plurality,

majority or other portion ofthe shares ofthe Series 0 Preferred Stock and any Voting Parity

Stock has been cast or given on any matter on which the holders ofshares of the Series D

Preferred Stock and any Voting Parity Stock are entitled to vot~ or consent together as a class

shall be determined by the Company by reference to the specified liquidation amount of the

shares of the Series D Preferred Stock voted or with respect to which a consent has been received

as ifthe Company were liquidated on the record date for such vote or consent, if any, or, in the

absence of a record date, on the date for such vote or consent. For purposes of determining the

voting rights ofthe holders ofthe Series D Preferred Stock under Section 7 ofthe Standard

Provisions forming part of this Certificate of Designations, each holder will be entitled to one

vote for each $10,000 of liquidation preference to which such holder's shares are entitled.

[Remainder ofPage Intentionally Left Blank]

2
IN WITNESS WHEREOF, the Company has caused this Certificate of Designations to

be signed on its behalf by its and attested by its Secretary this _th

day of November, 2008.

American International Group, Inc.

By:

Name:

Title:

ATTEST:

Name:

Title: Secretary

3
ANNEXA

STANDARD PROVISIONS

Section 1. General Matters. Each share ofthe Series D Preferred Stock shall be identical

in all respects to every other share of the Series D Preferred Stock. The Series D Preferred Stock

shall be perpetual, subject to the provisions of Section 5 of these Standard Provisions that form a

part of the Certificate of Designations. The Series D Preferred Stock (a) shall rank senior to the

Junior Stock in respect ofthe right to receive dividends and the right to receive payments out of

the assets of the Company upon voluntary or involuntary liquidation, dissolution or winding up

ofthe Company and (b) shall be of equal rank with Parity Stock as to the right to receive

dividends and the right to receive payments out of the assets ofthe Company upon voluntary or

involuntary liquidation, dissolution or winding up of the Company.

Section 2. Standard Definitions. As used herein with respect to the Series D Preferred

Stock:

(a) "Applicable Dividend Rate" means 10% per annum.

(b) "Business Combination" means a merger, consolidation, statutory share exchange

or similar transaction that requires the approval of the Company's stockholders.

(c) "Business Day" means any day except Saturday, Sunday and any day on which

banking institutions in the State of New York generally are authorized or required by law or

other governmental actions to close.

(d)

to time.

"Bylaws" means the bylaws.of the Company, as they may be amended from time

(e) "Certificate of Designations" means the Certificate of Designations or comparable

instrument relating to the Series D Preferred Stock, of which these Standard Provisions form a

part, as it may be amended from time to time.

(t)

amended.

(g)

(h)

"Charter" means the Company's Restated Certificate of Incorporation, as

"Dividend Period" has the meaning set forth in Section 3(a).

"Dividend Record Date" has the meaning set forth in Section 3(a).

(i) "Original Issue Date" means the date on which shares ofthe Series D Preferred

Stock are first issued.

(j) "Preferred Director" has the meaning set forth in Section 7(b).

(k) "Preferred Stock" means any and all series ofserial preferred stock ofthe

Company, including the Series D Preferred Stock.

£-1
(1) "Share Dilution Amount" has the meaning set forth in Section 3(b).

(m) "Standard Provisions" mean these Standard Provisions that form a part of the

Certificate of Designations relating to the Series D Preferred Stock.

(n) "Trust" means the AIG Credit Facility Trust.

(0) "Voting Parity Stock" means, with regard to any matter as to which the holders of

the Series D Preferred Stock are entitled to vote as specified in Sections 7(a) and 7(b) of these

Standard Provisions that form a part of the Certificate of Designations, any and all series of

Parity Stock upon which like voting rights have been conferred and are exercisable with respect

to such matter.

Section 3. Dividends.

(a) Rate. Holders ofthe Series D Preferred Stock shall be entitled to receive, on each

share of the Series D Preferred Stock if, as and when declared by the Board of Directors or any

duly authorized committee of the Board of Directors, but only out of assets legally available

therefor, cumulative cash dividends with respect to each Dividend Period (as defined below) at a

rate per annum equal to the Applicable Dividend Rate on (i) the Liquidation Amount per share of

the Series D Preferred Stock and (ii) the amount of accrued and unpaid dividends for any prior

Dividend Period on such share of the Series D Preferred Stock, if any. Such dividends shall

begin to accrue and be cumulative from the Original Issue Date, shall compound on each

subsequent Dividend Payment Date (i.e., no dividends shall accrue on other dividends unless and

until the first Dividend Payment Date for such other dividends has passed without such other

dividends having been paid on such date) and shall be payable quarterly in arrears on each

Dividend Payment Date, commencing with the first such Dividend Payment Date to occur at

least 20 calendar days after the Original Issue Date. In the event that any Dividend Payment

Date would otherwise fall on a day that is not a Business Day, the dividend payment due on that

date will be postponed to the next day that is a Business Day and no additional dividends will

accrue as a result ofthat postponement. The period from and including any Dividend Payment

Date to, but excluding, the next Dividend Payment Date is a "Dividend Period", provided that

the initial Dividend Period shall be the period from and including the Original Issue Date to, but

excluding, the next Dividend Payment Date.

Dividends that are payable on Series D Preferred Stock in respect of any Dividend Period

shall be computed on the basis of a 360-day year consisting of twelve 30-day months. The

amount of dividends payable on Series D Preferred Stock on any date prior to the end of a

Dividend Period, and for the initial Dividend Period. shall be computed on the basis of a 360-day

year consisting of twelve 30-day months, and actual days elapsed over a 30-day month.

Dividends that are payable on Series D Preferred Stock on any Dividend Payment Date

will be payable to holders of record of the Series D Preferred Stock as they appear on the stock

register ofthe Company on the applicable record date, which shall be the 15th calendar day

immediately preceding such Dividend Payment Date or such other record date fixed by the

Board of Directors or any duly authorized committee of the Board of Directors that is not more

than 60 nor less than 10 days prior to such Dividend Payment Date (each, a "Dividend Record

A-2
Date"). Any such day that is a Dividend Record Date shall be a Dividend Record Date whether

or not such day is a Business Day.

Holders of the Series D Preferred Stock shall not be entitled to any dividends, whether

payable in cash, securities or other property, other than dividends (if any) declared and payable

on the Series D Preferred Stock as specified in this Section 3 (subject to the other provisions of

the Certificate of Designations).

(b) Priority of Dividends. So long as any share of the Series D Preferred Stock

remains outstanding, no dividend or distribution shall be declared or paid on the Common Stock

or any other shares ofJunior Stock (other than dividends payable solely in shares of Common

Stock) or Parity Stock, subject to the immediately following paragraph in the case of Parity

Stock, and no CoIIUIion Stock, Junior Stock or Parity Stock shall be, directly or indirectly,

purchased, redeemed or otherwise acquired for consideration by the Corporation or any of its

subsidiaries unless all accrued and unpaid dividends for all past Dividend Periods, including the

latest completed Dividend Period (including, if applicable as provided in Section 3(a) above,

dividends on such amount), on all outstanding shares of the Series D Preferred Stock have been

or are contemporaneously declared and paid in full (or have been declared and a sum sufficient

for the payment thereof has been set aside for the benefit of the holders of shares of the Series D

Preferred Stock on the applicable record date). The foregoing limitation shall not apply to (i) a

dividend payable on any Junior Stock in shares of any other Junior Stock, or to the acquisition of

shares of any Junior Stock in exchange for, or through application of the proceeds of the sale of,

shares of any other Junior Stock; (ii) redemptions, purchases or other acquisitions ofshares of

Common Stock or other Junior Stock in connection with the administration of any employee

benefit plan in the ordinary course of business (including purchases to offset the Share Dilution

Amount (as defmed below) pursuant to a publicly announced repurchase plan) and consistent

with past practice, provided that any purchases to offset the Share Dilution Amount shall in no

event exceed the Share Dilution AmOlUlt; (iii) any dividends or distributions ofrights or Junior

Stock in cOImection with a stockholders' rights plan or any redemption or repurchase of rights

pursuant to any stockholders' rights plan; (iv) the acquisition by the Company or any of its

subsidiaries of record ownership in Junior Stock or Parity Stock for the beneficial ownership of

any other persons (other than the Corporation or any of its subsidiaries), including as trustees or

custodians; and (v) the exchange or conversion ofJunior Stock for or into other Junior Stock or

of Parity Stock for or into other Parity Stock (with the same or lesser aggregate liquidation

amount) or Junior Stock, in each case, solely to the extent required pursuant to binding

contractual agreements entered into prior to the Signing Date or any subsequent agreement for

the accelerated exercise, settlement or exchange thereof for Common Stock. "Share Dilution

Amounr' means the increase in the number of diluted shares outstanding (determined in

accordance with generally accepted accounting principles in the United States, and as measured

from the date ofthe Company's consolidated fmancial statements most recently filed with the

Securities and Exchange Commission prior to the Original Issue Date) resulting from the grant,

vesting or exercise of equity-based compensation to employees and equitably adjusted for any

stock split, stock dividend, reverse stock split, reclassification or s~ilar transaction.

When dividends are not paid (or declared and a sum sufficient for payment thereof set

aside for the benefit ofthe holders thereof on the applicable record date) on any Dividend

Payment Date (or, in the case of Parity Stock having dividend payment dates different from the

A-3
Dividend Payment Dates, on a dividend payment date falling within a Dividend Period related to

such Dividend Payment Date) in full upon the Series D Preferred Stock and any shares of Parity

Stock, all dividends declared on the Series D Preferred Stock and all such Parity Stock and

payable on such Dividend Payment Date (or, in the case of Parity Stock having dividend

payment dates different from the Dividend Payment Dates, on a dividend payment date falling

within the Dividend Period related to such Dividend Payment Date) shall be declared pro rata so

that the respective amounts of such dividends declared shall bear the same ratio to each other as

all accrued and unpaid dividends per share on the shares ofthe Series D Preferred Stock

(including, if applicable as provided in Section 3(a) above, dividends on such amount) and all

Parity Stock payable on such Dividend Payment Date (or, in the case of Parity Stock having

dividend payment dates different from the Dividend Payment Dates, on a dividend payment date

falling within the Dividend Period related to such Dividend Payment Date) (subject to their

having been declared by the Board of Directors or a duly authorized committee of the Board of

Directors out of legally available funds and including, in the case of Parity Stock that bears

cumulative dividends, all accrued but unpaid dividends) bear to each other. If the Board of

Directors or a duly authorized committee of the Board of Directors determines not to pay any

dividend or a full dividend on a Dividend Payment Date, the Company will provide written

notice to the holders of the Series D Preferred Stock prior to such Dividend Payment Date.

Subject to the foregoing, and not otherwise, such dividends (payable in cash, securities or

other property) as may be determined by the Board of Directors or any duly authorized

committee of the Board of Directors may be declared and paid on any securities, including

Common Stock and other Junior Stock, from time to time out of any funds legally available for

such payment, and holders of the Series D Preferred Stock shall not be entitled to participate in

any such dividends.

Section 4. Liquidation. Dissolution or Winding Up. In the event of any voluntary or

involuntary liquidation, dissolution or winding up of the affairs of the Company, then, before any

distribution or payment shall be made to the holders ofJunior Stock, the holders ofthe Series D

Preferred Stock and any shares of Preferred Stock ranking on a parity therewith as to liquidation

shall be entitled to be paid in full the respective amounts of the liquidation preferences thereof,

which in the case of the Series D Preferred Stock shall be $10,000.00 per share, plus an amount

equal to all accrued and unpaid dividends to such distribution or payment date, whether or not

earned or declared (including, if applicable, as provided in Section 3(a) above, dividends on such

accrued and unpaid dividends for all prior Dividend Periods). If such payment shall have been

made in full to the holders of the Series D Preferred Stock and any series of Preferred Stock

ranking on a parity therewith as to liquidation, the remaining assets and funds of the Company

shall be distributed among the holders ofJunior Stock, according to their respective rights and

preferences and in each case according to their respective shares. If, upon any liquidation,

dissolution or winding up of the affairs ofthe Company, the amounts so payable are not paid in

full to the holders of all outstanding shares of the Series D Preferred Stock and any series of

Preferred Stock ranking on a parity therewith as to liquidation, the holders ofthe Series D

Preferred Stock and any series of Preferred Stock ranking on a parity therewith as to liquidation

shall share ratably in any distribution of assets in proportion to the full amounts to which they

would otherwise be respectively entitled. Neither the consolidation or merger of the Company,

nor the sale, lease or conveyance of all or a part of its assets, shall be deemed a liquidation,

A-4
dissolution or winding up of the affairs of the Company within the meaning of the foregoing

provisions of this Section 4.

Section 5. Redemption.

(a) Optional Redemption. Except as provided in this Section 5(a), the Designated

Preferred Stock shall not be redeemable. At any time that (i) the Trust (or any successor entity

established for the benefit of the United States Treasury) "beneficially owns" less than 30% of

the aggregate voting power ofthe Company's voting securities and (ii) no holder ofthe Series D

Preferred Stock controls the Company, the Company may redeem, in whole or in part, at any

time and from time to time, out of funds legally available therefor, the shares of the Series D

Preferred Stock at the time outstanding, upon notice given as provided in Section 5(c) below, the

Series D Preferred Stock in whole or in part at a redemption price equal to 100% of its

Liquidation Amount, plus, except as set forth in the last sentence of the next paragraph, an

amount equal to all accrued and unpaid dividends to such redemption date (including, if

applicable, as provided in Section 3(a) above, dividends on accrued and unpaid dividends for all

prior Dividend Periods). "Control" for purposes of this Section 5(a) means the power to direct

the management and policies of the Company, directly or indirectly, whether through the

ownership of voting securities, by contract, by the power to control the Board of Directors or

otherwise. "Beneficially owns" for purposes of this Section 5(a) is defined in Rule 13d-3 under

the Securities Exchange Act of 1934, as amended to the Signing Date. For the avoidance of

doubt, while there is Board of Directors control (or the potential to gain Board of Directors

control as a result of existing contractual rights) by any holder of the Series D Preferred Stock,

the Company may not redeem any of the Series D Preferred Stock.

The redemption price for any shares of the Series D Preferred Stock shall be payable on

the redemption date to the holder of such shares against surrender ofthe certificate(s) evidencing

such shares to the Company or its agent. Any declared but unpaid dividends payable on a

redemption date that occurs subsequent to the Dividend Record Date for a Dividend Period shall

not be paid to the holder entitled to receive the redemption price on the redemption date, but

rather shall be paid to the holder of record of the redeemed shares on such Dividend Record Date

relating to the Dividend Payment Date as provided in Section 3 above.

(b) No Sinking Fund. The Series D Preferred Stock will not be subject to any

mandatory redemption, sinking fund or other similar provisions. Holders of the Series D

Preferred Stock will have no right to require redemption or repurchase of any shares of the Series

D Preferred Stock.

(c) Notice of Redemption. Notice of every redemption ofshares of the Series D

Preferred Stock shall be given by fIrst class mail, postage prepaid, addressed to the holders of

record ofthe shares to be redeemed at their respective last addresses appearing on the books of

the Company. Such mailing shall be at least 30 days and not more than 60 days before the date

fixed for redemption. Any notice mailed as provided in this Subsection shall be conclusively

presumed to have been duly given, whether or not the holder receives such notice, but failure

duly to give such notice by mail, or any defect in such notice or in the mailing thereof, to any

holder ofshares ofthe Series D Preferred Stock designated for redemption shall not affect the

validity ofthe proceedings for the redemption of any other shares of the Series D Preferred

A-5
Stock. Notwithstanding the foregoing, if shares of the Series D Preferred Stock are issued in

book-entry form through The Depository Trust Corporation or any other similar facility, notice

of redemption may be given to the holders ofthe Series D Preferred Stock at such time and in

any manner permitted by such facility. Each notice of redemption given to a holder shall state:

(I) the redemption date; (2) the number ofshares of the Series D Preferred Stock to be redeemed

and, ifless than all the shares held by such holder are to be redeemed, the number ofsuch shares

to be redeemed from such holder; (3) the redemption price; and (4) the place or places where

certificates for such shares are to be surrendered for payment of the redemption price, but failure

duly to give such notice to any holder of shares of the Series D Preferred Stock designated for

redemption or any defect in such notice shall not affect the validity of the proceedings for the

redemption of any other shares ofthe Series D Preferred Stock.

(d) Partial Redemption. In case of any redemption of part of the shares of the Series

D Preferred Stock at the time outstanding, the shares to be redeemed shall be selected either pro

rata or in such other manner as the Board of Directors or a duly authorized committee thereof

may determine to be fair and equitable. SubJect to the provisions hereof, the Board of Directors

or a duly authorized committee thereof shall have full power and authority to prescribe the terms

and conditions upon which shares of the Series D Preferred Stock shall be redeemed from time to

time. Iffewer than all the shares represented by any certificate are redeemed, a new certificate

shall be issued representing the unredeemed shares without charge to the holder thereof.

(e) Effectiveness ofRedemption. Ifnotice ofredemption has been duly given and if

on or before the redemption date specified in the notice all funds necessary for the redemption

have been deposited by the Company, in trust for the pro rata benefit of the holders ofthe shares

called for redemption, with a bank or trust company doing business in the Borough of

Manhattan, The City of New York, and having a capital and surplus of at least $500 million and

selected by the Board of Directors, so as to be and continue to be available solely therefor, then,

notwithstanding that any certificate for any share so called for redemption has not been

surrendered for cancellation, on and after the redemption date dividends shall cease to accrue on

all shares so called for redemption, all shares so called for redemption shall no longer be deemed

outstanding and all rights with respect to such shares shall forthwith on such redemption date

cease and terminate, except only the right of the holders thereofto receive the amount payable on

such redemption from such bank or trust company, without interest. Any funds unclaimed at the

end of three years from the redemption date shall, to the extent permitted by law, be released to

the Company, after which time the holders of the shares so called for redemption shall look only

to the Company for payment of the redemption price ofsuch shares.

(f) Status of Redeemed Shares. Shares of the Series D Preferred Stock that are

redeemed, repurchased or otherwise acquired by the Company shall revert to authorized but

unissued shares of the Series D Preferred Stock (provided that any such cancelled shares of the

Series D Preferred Stock may be reissued only as shares of any series of the Series D Preferred

Stock other than the Series D Preferred Stock).

Section 6. Conversion. Holders of the Series D Preferred Stock shares shall have no right

to exchange or convert such shares into any other securities.

Section 7. Voting Rights.

A-6
(a) General. The holders of the Series D Preferred Stock shall not have any voting

rights except as set forth below or as otherwise from time to time required by law.

(b) Series D Preferred Stock Directors. Whenever, at any time or times, dividends

payable on the shares of the Series D Preferred Stock have not been paid for an aggregate of four

quarterly Dividend Periods or more, whether or not consecutive, the authorized number of

directors ofthe Company shall automatically be increased to accommodate the number of the

Preferred Directors specified below and the holders of the Series D Preferred Stock shall have

the right, with holders of shares of anyone or more other classes or series of Voting Parity Stock

outstanding at the time, voting together as a class, to elect the greater of two directors and a

number of directors (rounded upward) equal to 20% ofthe total number of directors of the

Company after giving effect to such election (hereinafter the "Preferred Directors" and each a

"Preferred Director") to fIll such newly created directorships at the Company's next annual

meeting of stockholders (or at a special meeting called for that purpose prior to such next annual

meeting) and at each subsequent annual meeting ofstockholders until all accrued and unpaid

dividends for all past Dividend Periods, including the latest completed Dividend Period

(including, if applicable as provided in Section 3(a) above, dividends on such amount), on all

outstanding shares of the Series D Preferred Stock have been declared and paid in full at which

time such right shall terminate with respect to the Series D Preferred Stock, except as herein or

by law expressly provided, subject to revesting in the event of each and every subsequent

payment failure of the character above mentioned; provided that it shall be a qualification for

election for any Preferred Director that the election of such Preferred Director shall not cause the

Company to violate any corporate governance requirements of any securities exchange or other

trading facility on which securities of the Company may then be listed or traded that listed or

traded companies must have a majority of independent directors. Upon any termination of the

right of the holders of shares of the Series D Preferred Stock ·and Voting Parity Stock as a class

to vote for directors as provided above, the Preferred Directors shatl cease to be qualified as

directors, the term of office of all Preferred Directors then in office shall terminate immediately

and the authorized number of directors shall be reduced by the number ofthe Preferred Directors

elected pursuant hereto. Any Preferred Director may be removed at any time, with or without

cause, and any vacancy created thereby may be filled, only by the affirmative vote ofthe holders

a majority of the shares ofthe Series D Preferred Stock at the time outstanding voting separately

as a class together with the holders of shares of Voting Parity Stock, to the extent the voting

rights of such holders described above are then exercisable. Ifthe office of any Preferred

Director becomes vacant for any reason other than removal from office as aforesaid, the

remaining Preferred Director may choose a successor who shall hold office for the unexpired

term in respect of which such vacancy occurred.

(c) Class Voting Rights as to Particular Matters. So long as any shares ofthe Series D

Preferred Stock are outstanding, in addition to any other vote or consent of stockholders required

by law or by the Charter, the vote or consent of the holders of at least 662/3% of the shares of

the Series D Preferred Stock at the time outstanding, voting as a separate class, given in person

or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose,

shall be necessary for effecting or validating:

(i) Authorization of Senior or Pari Passu Stock. Any amendment or alteration

of the Certificate of Designations for the Series D Preferred Stock or the Charter to

A-7
authorize or create or increase the authorized amount of, or any issuance of, any shares

of, or any securities convertible into or exchangeable or exercisable for shares of, any

class or series of capital stock of the Company ranking senior to or pari passu with Series

D Preferred Stock with respect to either or both the payment of dividends and/or the

distribution of assets on any liquidation, dissolution or winding up ofthe Company;

provided that no such vote or consent of the holders of the Series D Preferred Stock shall

be required for the issuance of the Convertible Preferred Stock;

(ii) Amendment of the Series D Preferred Stock. Any amendment, alteration

or repeal of any provision ofthe Certificate of Designations for the Series D Preferred

Stock or the Charter (including, unless no vote on such merger or consolidation is

required by Section 7(c)(iii) below, any amendment, alteration or repeal by means of a

merger, consolidation or otherwise) so as to adversely affect the rights, preferences,

privileges or voting powers of the Series D Preferred Stock; or

(iii) Share Exchanges. Reclassifications. Mergers and Consolidations. Any

consummation of a binding share exchange or reclassification involving the Series D

Preferred Stock, or of a merger or consolidation of the Company with or into another

corporation or other entity, unless in each case (x) the shares of the Series D Preferred

Stock remain outstanding and are not amended in any respect or, in the case of any such

merger or consolidation with respect to which the Company is not the surviving or

resulting entity, are converted into or exchanged for preference securities of the surviving

or resulting entity or its ultimate parent, and (y) such shares remaining outstanding or

such preference securities, as the case may be, have such rights, preferences, privileges

and voting powers, and limitations and restrictions thereof, taken as a whole, as are not

materially less favorable to the holders thereof than the rights, preferences, privileges and

voting powers, and limitations and restrictions thereof, of the Series D Preferred Stock

immediately prior to such consulnmation, taken as a whole;

provided, however, that for all purposes of this Section 7(c), any increase in the amount ofthe

authorized Preferred Stock, including any increase in the authorized amount of the Series D

Preferred Stock necessary to satisfy preemptive or similar rights granted by the Company to

other persons prior to the Signing Date, or the creation and issuance, or an increase in the

authorized or issued amount, whether pursuant to preemptive or similar rights or otherwise, of

any other series of the Preferred Stock, or any securities convertible into or exchangeable or

exercisable for any other series of the Preferred Stock, ranking junior to the Series D Preferred

Stock with respect to the payment of dividends (whether such dividends are cumulative or noncumulative) and the distribution of assets upon liquidation, dissolution or winding up of the

Company will not be deemed to adversely affect the rights, preferences, privileges or voting

powers, and shall not require the affirmative vote or consent of, the holders of outstanding shares

of the Series D Preferred Stock.

(d) Changes after Provision for Redemption. No vote or consent of the holders ofthe

Series D Preferred Stock shall be required pursuant to Section 7(c) above if, at or prior to the

time when any such vote or consent would otherwise be required pursuant to such Section, all

outstanding shares of the Series D Preferred Stock shall have been redeemed, or shall have been

A-8
called for redemption upon proper notice and sufficient funds shall have been deposited in trust

for such redemption, in each case pursuant to Section 5 above.

(e) Procedures for Voting and Consents. The rules and procedures for calling and

conducting any meeting of the holders of the Series D Preferred Stock (including, without

limitation, the fixing of a record date in connection therewith), the solicitation and use of proxies

at such a meeting, the obtaining of written consents and any other aspect or matter with regard to

such a meeting or such consents shall be governed by any rules of the Board of Directors or any

duly authorized committee of the Board of Directors, in its discretion, may adopt from time to

time, which rules and procedures shall conform to the requirements of the Charter, the Bylaws,

and applicable law and the rules of any national securities exchange or other trading facility on

which Series D Preferred Stock is listed or traded at the time.

Section 8. Record Holders. To the fullest extent permitted by applicable law, the

Company and the transfer agent for Series D Preferred Stock may deem and treat the record

holder of any share of the Series D Preferred Stock as the true and lawful owner thereof for all

purposes, and neither the Company nor such transfer agent shall be affected by any notice to the

contrary.

Section 9. Notices. All notices or communications in respect of the Series D Preferred

Stock shall be sufficiently given if given in writing and delivered in person or by first class mail,

postage prepaid, or if given in such other manner as may be permitted in this Certificate of

Designations, in the Charter or Bylaws or by applicable law. Notwithstanding the foregoing, if

shares ofthe Series D Preferred Stock are issued in book-entry form through The Depository

Trust Company or any similar facility, such notices may be given to the holders of the Series D

Preferred Stock in any manner permitted by such facility.

Section 10. No Preemptive Rights. No holder ofthe Series D Preferred Stock shall be

entitled as a matter of right to subscribe for or purchase, or have any preemptive right with

respect to, any part of any new or additional issue ofstock of any class whatsoever, or of

securities convertible into any stock of any class whatsoever, whether now or hereafter

authorized and whether issued for cash or other consideration or by way of dividentJ.

Section 11. Replacement Certificates. The Company shall replace any mutilated

certificate at the holder's expense upon surrender of that certificate to the Company. The

Company shall replace certificates that become destroyed, stolen or lost at the holder's expense

upon delivery to the Company ofreasonably satisfactory evidence that the certificate has been

destroyed, stolen or lost, together with any indemnity that may be reasonably required by the

Company.

Section 12. Form.

(a) The Series D Preferred Stock shall be initially issued in the form of one or more

certificates in definitive, fully registered form with, until such time as otherwise determined by

the Company, the restricted shares legend (the "Restricted Shares Legend"), as set forth on the

form of the Series D Preferred Stock attached hereto as Exhibit A (each, a "Series D Preferred

Share Certificate"), which is hereby incorporated in and expressly made a part of this Certificate

A-9
of Designations. The Series D Preferred Share Certificate may have notations, legends or

endorsements required by law, stock exchange rules, agreements to which the Company is

subject, if any, or usage (provided that any such notation, legend or endorsement is in a form

acceptable to the Company).

(b) An Officer shall sign the Series D Preferred Share Certificate for the Company, in

accordance with the Company's Bylaws and applicable law, by manual or facsimile signature.

"Officer" means the Chairman, any Vice President, the Treasurer or the Secretary of the

Company.

(c) If an Officer whose signature is on a Series 0 Preferred Share Certificate no

longer holds that office at the time the ofthe issuance of such Series 0 Preferred Share

Certificate, such Series D Preferred Share Certificate shall be valid nevertheless.

(d) A Series 0 Preferred Share Certificate shall not be valid or obligatory until an

authorized signatory of the Transfer Agent manually countersigns the Series D Preferred Share

Certificate. The signature shall be conclusive evidence that such Series D Preferred Share

Certificate has been authenticated under this Certificate of Designations. Each Series D

Preferred Share Certificate shall be dated the date of its authentication.

Other than upon original issuance, all transfers and exchanges of the Designated

Preferred Stock shall be made by direct registration on the books and records of the Company.

Section 13. Transfer Agent And Registrar. The duly appointed Transfer Agent and

Registrar for the Series D Preferred Stock shall be Wells Fargo Bank, N.A. The Company may,

in its sole discretion, remove the Transfer Agent in accordance with the agreement between the

Company and the Transfer Agent; provided that the Company shall appoint a successor transfer

agent who shall accept such appointment prior to the effectiveness of such removal.

Section 14. Other Rights. The shares ofthe Series 0 Preferred Stock shall not have

any rights, preferences, privileges or voting powers or relative, participating, optional or other

special rights, or qualifications, limitations or restrictions thereof, other than as set forth herein or

in the Charter or as provided by applicable law.

A-lO
EXIDBITA

FORM OF SERIES D FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK

($10,000 LIQUIDATION PREFERENCE)

NUMBER

1

SHARES

4,000,000

CUSIP [ ]

AMERICAN INTERNATIONAL GROUP, INC.

INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE

TmS CERTIFICATE IS TRANSFERABLE

IN THE CITY OF NEW YORK, NEW YORK

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN

REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE

"SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE

TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A

REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT

AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION

FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS. EACH PURCHASER OF

THE SECURITIES REPRESENTED BY THIS INSTRUMENT IS NOTIFIED THAT THE

SELLER MAY BE RELYING ON THE EXEMPTION FROM SECTION 5 OF THE

SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. ANY TRANSFEREE OF

THE SECURITIES REPRESENTED BY THIS INSTRUMENT BY ITS ACCEPTANCE

HEREOF (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS

DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (2) AGREES THAT IT WILL

NOT OFFER, SELL OR OTHERWISE TRANSFER THE SECURITIES REPRESENTED BY

THIS INSTRUMENT EXCEPT (A) PURSUANT TO A REGISTRATION STATEMENT

WHICH IS THEN EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO LONG AS

THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE ELIGIBLE FOR

RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A

"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE

SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE

ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN

THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO THE

ISSUER OR (D) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE

REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT

IT WILL GIVE TO EACH PERSON TO WHOM THE SECURITIES REPRESENTED BY

THIS INSTRUMENT ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE

EFFECT OF THIS LEGEND.

This is to certify that the UNITED STATES DEPARTMENT OF THE TREASURY is

the owner of FOUR MILLION (4,000,000) fully paid and non-assessable shares of Series D

Fixed Rate Cumulative Perpetual Preferred Stock, $5.00 par value, liquidation preference

E-I
$10,000 per share (the "Stock"), of the American International Group, Inc. (the "Company"),

transferable on the books of the Company by the holder hereof in person or by duly authorized

attorney upon surrender ofthis certificate properly endorsed.

This certificate is not valid or obligatory for any purpose unless countersigned and

registered by the Transfer Agent and Registrar.

Witness the facsimile seal of the Company and the facsimile signatures of its duly

authorized officers.

Dated: November_, 2008

Name:

Title:

Name:

Title:

Countersigned and Registered

as Transfer Agent and Registrar

Authorized Signature

By: ----:---~__c__-------

A-2
AMERICAN INTERNATIONAL GROUP, INC.

AMERICAN INTERNATIONAL GROUP, INC. (the "Company") will furnish. without charge to each

stockholder who so requests, a copy of the certificate of designations establishing the powers, preferences and

relative, participating, optional or other special rights of each class of stock of the Company or series thereof and the

qualifications, limitations or restrictions of such preferences and/or rights applicable to each class of stock of the

Company or series thereof. Such information may be obtained by a request in writing to the Secretary of the

Company at its principal place of business.

This certificate and the share or shares represented hereby are issued and shall be held subject to all of the

provisions of the Company's Restated Certificate of Incorporation. as amended, and the Certificate of Designations

ofthe Series D Fixed Rate Cumulative Perpetual Preferred Stock (Liquidation Preference $10.000 per share) (copies

of which are on file with the Transfer Agent), to all of which the holder, by acceptance hereof, assents.

The following abbreviations. when used in the inscription on the face of this certificate, shall be construed

as though they were written out in full to applicable laws or regulations:

TEN COM - as tenants in common

TEN ENT - as tenants by the entireties

IT TEN - as joint tenants with right of

survivorship and not as

tenants in common

UNIF GIFT MIN ACT-Custodian

(Minor) (Cust)

under Uniform Gifts to Minors Act

(State)

Additional abbreviations may also be used though not in the above list.

For value received, hereby sen(s). assign(s) and transfer(s) unto

PLEASE INSERT SOCIAL SECURITY OR OTHER

IDENTIFYING NUMBER OF ASSIGNEE

PLEASE PRINT ORTYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE

______________________________shares

of the capital stock represented by the within certificate. and do(es) hereby irrevocably constitute and appoint

__________•Attorney to transfer the said stock on the books ofthe within named Company with

full power ofsubstitution in the premises.

A-3
Dated, _

Signature

NOTICE: The signature to this assignment must correspond

with the name as written upon the face of this

certificate in every particular. without

alteration or enlargement or any change whatever.

SIGNATURE GUARANTEED

NOTICE: The signature(s) should be

guaranteed by an eligible guarantor

institution (banks, stockbrokers, savings

and loan associations. and credit unions

with membership in an approved signature

guarantee medallion program). pursuant to

Rule 17Ad-15 under the Securities

Exchange Act of 1934.

A-4
ANNEX B-1

FORM OF WAIVER FOR THE SENIOR EXECUTIVE OFFICERS

AND THE SENIOR PARTNERS

In consideration for the benefits I will receive as a result of the participation of American

International Group, Inc. (together with its subsidiaries and affiliates, the "Company") in the

United States Department of the Treasury's Program for Systemically Significant Failing

Institutions (as set forth in Notice 2008-PSSFI) and any other economic stabilization program

implemented by the Department of the Treasury under the Emergency Economic Stabilization

Act of 2008 (the "Act") either prior to or subsequent to the date of this letter from me (any such

program, including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and the

Company, the Company's Board of Directors, any individual member of the Company's Board

of Directors and the Company's officers, employees, representatives and agents for any changes

to my compensation or benefits that are required to comply with the regulations issued by the

Department of the Treasury in connection with an EESA Program, including without limitation

the regulations issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet agreement

between the Company and United States Department of the Treasury (the "Limitations").

I acknowledge that the aforementioned regulations and Limitations may require

modification of the compensation, bonus, incentive and other benefit plans, arrangements,

policies and agreements (including so-called "golden parachute" agreements), whether or not in

writing, that I may have with the Company or in which 1may participate as they relate to the

period the United States holds any equity or debt securities of the Company acquired through an

EESA Program, including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or Limitations, as the

case may be.

This waiver includes all claims I may have under the laws of the United States or any

state related to the requirements imposed by the aforementioned regulations and Limitations,

induding without limitation a claim for any compensation or other payments or benefits 1would

otherwise receive, any challenge to the process by which the aforementioned regulations or

Limitations are or were adopted and any tort or constitutional claim about the effect of these

regulations or Limitations on my employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this __th day of November, 2008.

Name:

(NY) 07865100mARPISPA.doc
ANNEX B-2

FORM OF WAIVER FOR THE COMPANY

In consideration for the benefits that it will receive as a result of its participation in the United

States Department of the Treasury's Programs for Systemically Significant Failing Institutions

(as set forth in Notice 2008-PSSFI) and any other economic stabilization program implemented

by the Department of the Treasury under the Emergency Economic Stabilization Act of 4008

(the "EESA") either prior to or subsequent to the date of this letter (any such program, including

the Programs for Systemically Significant Failing lnstitutions, an "EESA Program"), American

International Group, Inc. (together with its subsidiaries and affiliates, the "Company") hereby

voluntarily waives any claim against the United States for any changes to compensation or

benefits ofthe Company's employees that are required to comply with the regulations issued by

the Department of the Treasury in connection with an EESA Program, including without

1imitation the regulations issued on October 14, 2008 and the requirements of Section 4.10 of the

Securities Purchase Agreement dated as of November 25, 2008 between the Company and the

United States Department of the Treasury.

The Company acknowledges that the aforementioned regulations and such requirements may

require modification of the compensation, bonus, incentive and other benefit plans, arrangements,

policies and agreements (including so-called "golden parachute" agreements), whether or not in

writing, that the Company may have with its employees or in which such employees may

participate as the regulations and such requirements relate to the period the United States holds·

any equity or debt securities ofthe Company acquired through an EESA Program, including

without limitation the Programs for Systemically Significant Failing Institutions Program, or for

any other period applicable under such EESA Program.

This waiver includes all claims the Company may have under the laws of the United States or

any state related to the requirements imposed by the aforementioned regulations and such

requirements, including without limitation a claim for any compensation or other payments or

benefits the Company's employees would otherwise receive, any challenge to the process by

which the aforementioned regulations are or were adopted and any tort or constitutional claim

about the effect of these regulations on the Company's employment relationship with its

employees.

(NY) 07865/OO?.JTARP/SPA.doc
ANNEXC

FORM OF OPINION

(a) The Company has been duly incorporated and is an existing corporation in good

standing under the laws of the state of its incorporation.

(b) The Preferred Stock has been duly and validly authorized, and, when issued and

delivered pursuant to the Agreement, the Preferred Stock will be validly issued and fully paid

and non-assessable, will not be issued in violation of any preemptive rights.

(c) The Warrant has been duly authorized and, when executed and delivered as

contemplated hereby, will constitute a valid and legally binding obligation of the Company

enforceable against the Company in accordance with its terms, except as the same may be

limited by applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or

similar laws affecting the creditors' rights and general equitable principles, regardless of whether

such enforceability is considered in a proceeding at law or in equity.

(d) The shares of Common Stock issuable upon exercise of the Warrant have been

duly authorized and reserved for issuance upon exercise of the Warrant and when so issued in

accordance with·the tenns of the Warrant will be validly issued, fully paid and non-assessable.

(e) The Company has the corporate power and authority to execute and deliver the

Agreement and the Warrant to carry out its obligations thereunder (which includes the issuance

of the Preferred Stock, Warrant and Warrant Shares).

(D The execution, delivery and performance by the Company of the Agreement and

the Warrant and the consummation of the transactions contemplated thereby have been duly

authorized by all necessary corporate action on the part ofthe Company and its stockholders, and

no further approval or authorization is required on the part of the Company, other than the vote

of the stockholders described in Section 3.1(b) of the Agreement.

(g) The Agreement is a valid and binding obligation of the Company enforceable

against the Company in accordance with its tenns, except as the same may be limited by

applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the

creditors' rights and general equitable principles, regardless of whether such enforceability is

considered in a proceeding at law or in equity; provided, however, such counsel need express no

opinion with respect to Section 3.1(b) or Section 4.5(g) or the severability provisions of the

Agreement insofar as Section 3.1(b) or Section 4.5(g)is concerned.

(NY) 078651OO2!TARP/SPA.doc
(NY) 078651OO2ffARPISPA.doc

FORM OF WARRANT

[SEE AITACHED]

ANNEXD
WARRANT TO PURCHASE COMMON STOCK

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT

BEEN REGISTERED UNDER THE SECURITIES ACT OF 193~, AS

AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT

BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT

WHILE A REGISTRATION STATEMENT RELATING THEREtO IS IN

EFFECT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES

LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRjATION

UNDER SUCH ACT OR SUCH LAWS. THIS INSTRUMENT lSi ISSUED

SUBJECT TO THE RESTRICTIONS ON TRANSFER AND OTHER

PROVISIONS OF A SECURITIES PURCHASE AGREEMENT BETWEEN

THE ISSUER OF THESE SECURITIES AND THE INVESTOR REFERRED

TO THEREIN, A COPY OF WHICH IS ON FILE WITH THE ISSUER. THE

SECURITIES REPRESENTED BY THIS INSTRUMENT MAY NOT BE SOLD

OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID

AGREEMENT. ANY SALE OR OTHER TRANSFER NOT IN COMPLIANCE

WITH SAID AGREEMENT WILL BE VOID.

WARRANT

to purchase

53,798,766

Shares of Common Stock

of Al\1ERICAN INTERNATIONAL GROUP, INC.

Issue Date: November [ J, 2008

]. Definitions. Unless the context otherwise requires, when used

herein the following terms shall have the meanings indicated.

"Affiliate" has the meaning ascribed to it in the Purchase Agreement.

"Appraisal Procedure" means a procedure whereby two independent

appraisers, one chosen by the Company and one by the Original Warrantholder,

shall mutually agree upon the determinations then the subject of appraisal. Each

party shall deliver a notice to the other appointing its appraiser within 15 days

after the Appraisal Procedure is invoked. If within 30 days after appointment of

the two appraisers they are unable to agree upon the amount in question, a third

independent appraiser shall be chosen within 10 days thereafter by the mutual

consent of such first two appraisers. The decision ofthe third appraiser so

appointed and chosen shall be given within 30 days after the selection of such

third appraiser. If three appraisers shall be appointed and the determination of one

appraiser is disparate from the middle determination by more than twice the

amount by which the other determination is disparate from the middle

determination, then the determination of such appraiser shall be excluded, the

remaining two determinations shall be averaged and such average ~hal1 be binding

and conclusive upon the Company and the Original Warrantholder: otherwise, the
average of all three determinations shall be binding upon the Company and the

Original Warrantholder. The costs of conducting any Appraisal Procedure shall be

borne by the Company.

"Board ofDirectors" means the board of directors of the Company,

including any duly authorized committee thereof.

"Business Combination" means a merger, consolidation, statutory share

exchange or similar transaction that requires the approval of the Company's

stockholders.

"business day" means any day except Saturday, Sunday and any day on

which banking institutions in the State of New York generally are authorized or

required by law or other governmental actions to close.

"Capital Stock" means (A) with respect to any Person that is a corporation

or company, any and all shares, interests, participations or other equivalents

(however designated) of capital or capital stock of such Person and (B) with

respect to any Person that is not a corporation or company, any and all partnership

or other equity interests of such Person.

"Charter" means, with respect to any Person, its certificate or articles of

incorporation, articles of association, or similar organizational document.

"Charter Amendment" means the amendments to the Company's Restated

Certificate of Incorporation to reduce the par value of the Common Stock to

$0.000001 per share and increase the number of authorized shares of Common

Stock to 19 billion.

"Common Stock" has the meaning ascribed to it in the Purchase

Agreement.

"Company" means the American International Group, Inc.

"conversion" has the meaning set forth in Section 13(C).

"convertible securities" has the meaning set forth in Section 13(C).

"Exchange Act" means the Securities Exchange Act of 1934, as amended,

or any successor statute, and the rules and regulations promulgated thereunder.

"Exercise Price" means, with respect to this Warrant, initially, $2.50, and

upon the effectiveness of the Charter Amendment, the amended par value per

share of Common Stock.

"Expiration Time" has the meaning set forth in Section 3.

2
"Fair Market Value" means, with respect to any security or other property,

the fair market value of such security or other property as determined by the

Board of Directors, acting in good faith or, with respect to Section 14, as

determined by the Original Warrantholder acting in good faith. For so long as the

Original Warrantholder holds this Warrant or any portion thereof, it may object in

writing to the Board of Director's calculation offair market value within 10 days

of receipt of written notice thereof. If the Original Warrantholder and the

Company are unable to agree on fair market value during the 1O-day period

following the delivery of the Original Warrantholder's objection, the Appraisal

Procedure may be invoked by either party to determine Fair Market Value by

delivering written notification thereof not later than the 30th day after delivery of .

the Original Warrantholder's objection.

"Governmental Entities" has the meaning ascribed to it in the Purchase

Agreement.

"Initial Number" has the meaning set forth in Section 13(C).

"Issue Date" means November [ ],2008.

"Market Price" means, with respect to a particular security, on any given

day, the last reported sale price regular way or, in case no such reported sale takes

place on such day, the average of the last closing bid and ask prices regular way,

in either case on the principal national securities exchange on which the

applicable securities are listed or admitted to trading, or if not listed or admitted to

trading on any national securities exchange, the average of the closing bid and ask

prices as furnished by two members of the Financial Industry Regulatory

Authority, Inc. selected from time to time by the Company for that purpose.

"Market Price" shall be determined without reference to after hours or extended

hours trading. Ifsuch security is not listed and traded in a manner that the

quotations referred to above are available for the period required hereunder, the

Market Price per share of Common Stock shall be deemed to be (i) in the event

that any portion of the Warrant is held by the Original Warrantholder, the fair

market value per share of such security as determined in good faith by the

Original Warrantholder or (ii) in all other circumstances, the fair market value per

share ofsuch security as determined in good faith by the Board of Directors in

reliance on an opinion of a nationally recognized independent investment banking

corporation retained by the Company for this purpose and certified in a resolution

to the Warrantholder. For the purposes of determining the Market Price of the

Common Stock on the "trading day" preceding, on or foJJowing the occurrence of

an event, (i) that trading day shall be deemed to commence immediately after the

regular scheduled closing time of trading on the New York Stock Exchange or, if

trading is closed at an earlier time, such earlier time and (ii) that trading day shaJJ

end at the next regular scheduled closing time, or if trading is close,d at an earlier

time, such earlier time (for the avoidance of doubt, and as an example, if the

Market Price is to be determined as of the last trading day preceding a specified

event and the closing time of trading on a particular day is 4:00 p.m. and the

3
specified event occurs at 5:00 p.m. on that day, the Market Price would be

detennined by reference to such 4:00 p.m. closing price).

"Original Warrantholder" means the United States Department of the

Treasury. Any actions specified to be taken by the Original Warrantholder

hereunder may only be taken by such Person and not by any other Warrantholder.

"Permitted Transactions" has the meaning set forth in Section 13(e).

"Person" has the meaning given to it in Section 3(a)(9) of the Exchange

Act and &s used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act.

"Per Share Fair Market Value" has the meaning set forth in Section 13(D).

"Preferred Shares" means the perpetual preferred stock issued to the

Original Warrantholder on the Issue Date pursuant to the Purchase Agreement.

"Pro Rata Repurchases" means any purchase ofshares of Common Stock

by the Company or any subsidiary thereof pursuant to (A) any tender offer or

exchange offer subject to Section 13(e) or 14(e) of the Exchange Act or

Regulation 14E promulgated thereunder or (B) any other offer available to

substantially all holders of Common Stock, in the case of both (A) or (B), whether

for cash, shares of Capital Stock of the Company, other securities of the Company,

evidences of indebtedness of the Company or any other Person or any other

property (including, without limitation, shares ofCapital Stock, other securities or

evidences of indebtedness of a subsidiary), or any combination thereof, effected

while this Warrant is outstanding. The "Effective Date" of a Pro Rata Repurchase

shall mean the date of acceptance of shares for purchase or exchange by the

Company under any tender or exchange offer which is a Pro Rata Repurchase or

the date of purchase with respect to any Pro Rata Repurchase that is not a tender

or exchange offer.

"Purchase Agreement" means the Securities Purchase Agreement, dated

as of November [ ], 2008, as amended from time to time, between the Company

and the United States Department ofthe Treasury, including all annexes and

schedules thereto.

"Regulatory Approvals" with respect to the Warrantholder, means, to the

extent applicable and required to permit the Warrantholder to exercise this

Warrant for shares of Common Stock and to own such Common Stock without

the Warrantholder being in violation of applicable law, rule or regulation, the

receipt of any necessary approvals and authorizations of, filings and registrations

with, notifications to, or expiration or tennination of any applicable waiting

period under, the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as

amended, and the rules and regulations thereunder.

"SEC" means the U.S. Securities and Exchange Commission.

4
"Securities Ad' means the Securities Act of 1933, as amended, or any

successor statute, and the rules and regulations promulgated thereunder.

"Shares" has the meaning set forth in Section 2.

"trading day" means (A) if the shares of Common Stock are not traded on

any national or regional securities exchange or association or over-the-counter

market, a business day or (B) if the shares of Common Stock are traded on any

national or regional securities exchange or association or over-the-counter market,

a business day on which such relevant exchange or quotation system is scheduled

to be open for business and on which the shares of Common Stock (i) are not

suspended from trading on any national or regional securities exchange or

association or over-the-counter market for any period or periods aggregating one

half hour or longer; and (ii) have traded at least once on the national or regional

securities exchange or association or over-the-counter market that is the primary

market for the trading of the shares of Common Stock.

"U.S. GAAP" means United States generally accepted accounting

principles.

"Warramholder" has the meaning set forth in Section 2.

"Warrant" means this Warrant, issued pursuant to the Purchase

Agreement.

2. Number of Shares; Exercise Price. This certifies that, for value

received, the United States Department of the Treasury or its permitted assigns

(the "Warrantholder") is entitled, upon the terms and subject to the conditions

hereinafter set forth, to acquire from the Company, in whole or in part, after the

receipt of all applicable Regulatory Approvals, if any, up to an aggregate of

53,798,766 fully paid and nonassessable shares of Common Stock, at a purchase

price per share of Common Stock equal to the Exercise Price. The number of

shares of Common Stock (the "Shares") and the Exercise Price are subject to

adjustment as provided herein, and all references to "Common Stock," "Shares"

and "Exercise Price" herein shall be deemed to include any such adjustment or

series of adjustments.

3. Exercise of Warrant; Term. Subject to Section 2, to the extent

pennitted by applicable laws and regulations, the right to purchase the Shares

represented by this Warrant is exercisable, in whole or in part by the

Warrantholder, at any time or from time to time after the execution and delivery .

of this Warrant by the Company on the date hereof, but in no event later than 5:00

p.m., New York City time on the tenth anniversary of the Issue Date (the

"Expiration Time"), by (A) the surrender ofthis Warrant and Noti~ of Exercise

annexed hereto, duly completed and executed on behalf ofthe Warrantholder, at

the principal executive office of the Company located at 70 Pine Street, New

York, New York 10270 Attention: Chief Financial Officer (or stich other office or

5
agency ofthe Company in the United States as it may designate by notice in

writing to the WarranthoJder at the address of the Warrantholder appearing on the

books of the Company), and (B) payment ofthe Exercise Price for the Shares

thereby purchased:

(i) by having the Company withhold, from the shares of Common

Stock that would otherwise be delivered to the Warrantholder upon such exercise,

shares ofCommon Stock issuable upon exercise of the Warrant equal in value to

the aggregate Exercise Price as to which this Warrant is so exercised based on the

Market Price of the Common Stock on the trading day on which this Warrant is

exercised and the Notice of Exercise is delivered to the Company pursuant to this

Section 3, or

(ii) with the consent of both the Company and the Warrantholder, by

tendering in cash, by certified or cashier's check payable to the order of the

Company, or by wire transfer of immediately available funds to an account

designated by the Company.

If the Warrantholder does not exercise this Warrant in its entirety, the

Warrantholder will be entitled to receive from the Company within a reasonable

time, and in any event not exceeding three business days. a new warrant in

substantially identical form for the purchase of that number of Shares equal to the

difference between the number of Shares subject to this Warrant and the number

of Shares as to which this Warrant is so exercised. Notwithstanding anything in

this Warrant to the contrary, the Warrantholder hereby acknowledges and agrees

that its exercise of this Warrant for Shares is subject to the condition that the

Warrantholder will have first received any applicable Regulatory Approvals.

4. Issuance of Shares; Authorization; Listing. Book-entries

representing Shares issued upon exercise of this Warrant will be promptly

recorded in such name or names as the Warrantholder may designate. The

Company hereby represents and warrants that any Shares issued upon the exercise

of this Warrant in accordance with the provisions of Section 3 will be duly and

validly authorized and issued, fully paid and nonassessable and free from all taxes,

liens and charges (other than liens or charges created by the Warrantholder,

income and franchise taxes incurred in connection with the exercise of the

Warrant or taxes in respect of any transfer occurring contemporaneously

therewith). The Company agrees that the Shares so issued will be deemed to have

been issued to the Warrantholder as of the close of business on the date on which

this Warrant and payment of the Exercise Price are delivered to the Company in

accordance with the terms of this Warrant, notwithstanding that the stock transfer

books of the Company may then be closed. The Company will at all times reserve

and keep available, out of its authorized but unissued Common Stock, solely for

the purpose of providing for the exercise of this Warrant, the aggregate number of

shares of Common Stock then issuable upon exercise of this Warrant at any time.

The Company will (A) procure, at its sole expense, the listing of the Shares

issuable upon exercise of this Warrant at any time, subject to issuance or notice of

6
issuance, on all principal stock exchanges on which the Common Stock is then

listed or traded and (B) maintain such listings of such Shares at all times after

issuance. The Company will use reasonable best efforts to ensure that the Shares

may be issued without violation of any applicable law or regulation or of any

requirement of any securities exchange on which the Shares are listed or traded.

5. No Fractional Shares or Scrip. No fractional Shares or scrip

representing fractional Shares shall be issued upon any exercise ofthis Warrant.

In lieu of any fractional Share to which the Warrantholder would otherwise be

entitled, the Warrantholder shall be entitled to receive a cash payment equal to the

Market Price of the Common Stock on the last trading day preceding the date of .

exercise less the pro-rated Exercise Price for such fractional share.

6. No Rights as Stockholders; Transfer Books. This Warrant does not

entitle the Warrantholder to any voting rights or other rights as a stockholder of

the Company prior to the date of exercise hereof. The Company will at no time

close its transfer books against transfer of this Warrant in any manner which

interferes with the timely exercise ofthis Warrant.

7. Charges, Taxes and Expenses. Issuance of Shares to the

Warrantholder upon the exercise of this Warrant shall be made without charge to

the Warrantholder for any issue or transfer tax or other incidental expense in

respect of the issuance of such Shares, all of which taxes and expenses shall be

paid by the Company.

8. Transfer/Assimment.

(A) Subject to compliance with clause (B) of this Section 8, this

Warrant and all rights hereunder are transferable, in whole or in part, upon the

books of the Company by the registered holder hereof in person or by duly

authorized attorney, and a new warrant shall be made and delivered by the

Company, of the same tenor and date as this Warrant but registered in the name of

one or more transferees, upon surrender ofthis Warrant. duly endorsed, to the

office or agency ofthe Company described in Section 3. All expenses (other than

stock transfer taxes) and other charges payable in connection with the preparation.

execution and delivery of the new warrants pursuant to this Section 8 shall be paid

by the Company.

(B) The transfer of the Warrant and the Shares issued upon exercise of

the Warrant are subject to the restrictions set forth in Section 4.4 of the Purchase

Agreement. If and for so long as required by the Purchase Agreement, this

Warrant shall contain the legends as set forth in Section 4.2(a) of the Purchase

Agreement.

9. Exchange and Registry of Warrant. This Warrant is exchangeable.

upon the surrender.hereof by the Warrantholder to the Company, for a new

warrant or warrants of like tenor and representing the right to purchase the same

7
aggregate number of Shares. The Company shall maintain a registry showing the

name and address of the Warrantholder as the registered holder of this Warrant.

This Warrant may be surrendered for exchange or exercise in accordance with its

terms, at the office of the Company, and the Company shall be entitled to rely in

all respects, prior to written notice to the contrary, upon such registry.

10. Loss, Theft, Destruction or Mutilation of Warrant Upon receipt by

the Company of evidence reasonably satisfactory to it of the loss, theft,

destruction or mutilation ofthis Warrant, and in the case of any such loss, theft or

destruction, upon receipt of a bond, indemnity or security reasonably satisfactory

to the Company, or, in the case of any such mutilation, upon surrender and

cancellation of this Warrant, the Company shall make and deliver, in lieu of such

lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and

representing the right to purchase the same aggregate number of Shares as

provided for in such lost, stolen, destroyed or mutilated Warrant.

11. Saturdays. Sundays, Holidays, etc. If the last or appointed day for

the taking of any action or the expiration of any right required or granted herein

shall not be a business day, then such action may be t.aken or such right may be

exercised on the next succeeding day that is a business day:

12. Rule 144 Information. The Company covenants that it will use its

reasonable best efforts to timely file all reports and other documents required to

be filed by it under the Securities Act and the Exchange Act and the rules and

regulations promulgated by the SEC thereunder (or, if the Company is not

required to file such reports, it will, upon the request of any Warrantholder, make

publicly available such information as necessary to permit sales pursuant to Rule

144 under the Securities Act), and it will use reasonable best efforts to take such

further action as any Warrantholder may reasonably request, in each case to the

extent required from time to time to enable such holder to, if permitted by the

terms ofthis Warrant and the Purchase Agreement, sell this Warrant without

registration under the Securities Act within the limitation of the exemptions

provided by (A) Rule 144 under the Securities Act, as such rule may be amended

from time to time, or (B) any successor rule or regulation hereafter adopted by the

SEC. Upon the written request of any Warrantholder, the Company will deliver to

such Warrantholder a written statement that it has complied with such

requirements.

13. Adjustments and Other Rights. The Exercise Price and the number

of Shares issuable upon exercise of this Warrant shall be subject to adjustment

from time to time as follows; provided, that if more than one subsection of this

Section 13 is applicable to a single event, the subsection shall be applied that

produces the largest adjustment and no single event shall cause an adjustment

under more than one subsection of this Section 13 so as to result in duplication:

8
(A) Charter Amendment. Upon the effectiveness of the Charter

Amendment, the Exercise' Price shall be adjusted from its initial value of $2.50 to

the amended par value per share of Common Stock.

(B) Stock Splits. Subdivisions. Reclassifications or Combinations. If

the Company shall (i) declare and pay a dividend or make a distribution on its

Common Stock in shares of Common Stock, (ii) subdivide or reclassify the

outstanding shares of Common Stock into a greater number of shares, or (iii)

combine or reclassify the outstanding shares of Common Stock into a smaller

number of shares, the number of Shares issuable upon exercise of this Warrant at

the time of the record date for such dividend or distribution or the effective date

ofsuch subdivision, combination or reclassification shall be proportionately

adjusted so that the Warrantholder after such date shall be entitled to purchase the

number of shares of Common Stock which such holder would have owned or

been entitled to receive in respect of the shares of Common Stock subject to this

Warrant after such date had this Warrant been exercised immediately prior to such

date. In such event, the Exercise Price in effect at the time of the record date for

such dividend or distribution or the effective date of such subdivision,

combination or reclassification shall be adjusted to the number obtained by

dividing (x) the product of (1) the number of Shares issuable upon the exercise of

this Warrant before such adjustment and (2) the Exercise Price in effect

immediately prior to the record or effective date, as'the case may be, for the

dividend, distribution, subdivision, combination or reclassification giving rise to

this adjustment by (y) the new number of Shares issuable upon exercise of the

Warrant determined pursuant to the immediately preceding sentence.

(C) Certain Issuances of Common Shares or Convertible Securities.

Until the earlier of (i) the date on which the Original Warrantholder no longer

holds this Warrant or any portion thereof and (ii) the third anniversary of the Issue

Date, if the Company shall issue shares of Common Stock (or rights or warrants

or other securities exercisable or convertible into or exchangeable (collectively, a

"conversion") for shares of Common Stock) (collectively, "convertible securities")

(other than in Permitted Transactions (as defined below) or a transaction to which

subsection (B) ofthis Section 13 is applicable) without consideration or at a

consideration per share (or having a conversion price per share) that is less than

90% of the Market Price on the last trading day preceding the date of the

agreement on pricing such shares (or such convertible securities) then, in such

event:

(A) the number of Shares issuable upon the exercise of this Warrant

immediately prior to the date of the agreement on pricing of such shares

(or of such convertible securities) (the "Initial Number") shan be increased

to the number obtained by multiplying the Initial Number b~ a fraction (A)

the numerator of which shan be the sum of (x) the number of shares of

Common Stock ofthe Company outstanding on such date and (y) the

number of additional shares of Common Stock issued (or into which

convertible securities may be exercised or convert) and (B) the

9
denominator of which shall be the sum of (1) the number of shares of

Common Stock outstanding on such date and (1I) the number of shares of

Common Stock which the aggregate consideration receivable by the

Company for the total number ofshares of Common Stock so issued (or

into which convertible securities may be exercised or convert) would

purchase at the Market Price on the last trading day preceding the date of

the agreement on pricing such shares (or such convertible securities); and

(B) the Exercise Price payable upon exercise ofthe Warrant shall be

adjusted by multiplying such Exercise Price in effect immediately prior to

the date of the agreement on pricing ofsuch shares (or of such convertible

securities) by a fraction, the numerator of which shall be the number of

shares of Common Stock issuable upon exercise of this Warrant prior to

such date and the denominator of which shall be the number of shares of

Common Stock issuable upon exercise of this Warrant immediately after

the adjustment described in clause (A) above.

For purposes of the foregoing, the aggregate consideration receivable by

the Company in connection with the issuance of such shares of Common Stock or

convertible securities shall be deemed to be equal to the sum of the net offering

price (including the Fair Market Value of any non-cash consideration and after

deduction of any related expenses payable to third parties) of all such securities

plus the minimum aggregate amount, if any, payable upon exercise or conversion

of any such convertible securities into shares of Common Stock; and "Permitted

Transactions" shall mean issuances (i) as consideration fOf or to fund the

acquisition of businesses andlor related assets, (ii) in connection with employee

benefit plans and compensation related arrangements in the ordinary course and

consistent with past practice approved by the Board of Directors, (iii) in

connection with a public or broadly marketed offering and sale of Common Stock

or convertible securities for cash conducted by the Company or its affiliates

pursuant to registration under the Securities Act or Rule 144A thereunder on a

basis consistent with capital raising transactions by comparable financial

institutions and (iv) in connection with the exercise of preemptive rights on terms

existing as of the Issue Date. Any adjustment made pursuant to this Section l3(C)

shall become effective immediately upon the date of such issuance.

(D) Other Distributions. In case the Company shall fix a record date for

the making of a distribution to all holders of shares of its Common Stock of

securities, evidences of indebtedness, assets, cash, rights or warrants (excluding

dividends of its Common Stock and other dividends or distributions referred to in

Section l3(B», in each such case, the Exercise Price in effect prior to such record

date shall be reduced immediately thereafter to the price determined by

multiplying the Exercise Price in effect immediately prior to the reduction by the

quotient of (x) the Market Price of the Common Stock on the last trading day

preceding the first date on which the Common Stock trades regular way on the

principal national securities exchange on which the Common Stock is 'listed or

admitted to trading without the right to receive such distribution, minus the

10
amount of cash and/or the Fair Market Value of the securities, evidences of

indebtedness, assets, right'S or warrants to be so distributed in respect of one share

of Common Stock (such amount and/or Fair Market Value, the "Per Share Fair

Market Value") divided by (y) such Market Price on such date specified in clause

(x); such adjustment shall be made successively whenever such a record date is

fixed. In such event, the number of Shares issuable upon the exercise of this

Warrant shall be increased to the number obtained by dividing (x) the product of

(1) the number of Shares issuable upon the exercise of this Warrant before such

adjustment, and (2) the Exercise Price in effect immediately prior to the

distribution giving rise to this adjustment by (y) the new Exercise Price

determined in accordance with the immediately preceding sentence. In the event .

that such distribution is not so made, the Exercise Price and the number of Shares

issuable upon exercise of this Warrant then in effect shall be readjusted, effective

as of the date when the Board of Directors determines not to distribute such shares,

evidences of indebtedness, assets, rights, cash or warrants, as the case may be, to

the Exercise Price that would then be in effect and the number of Shares that

would then be issuable upon exercise of this Warrant if such record date had not

been fixed.

(E) Certain Repurchases of Common Stock. In case the Company

effects a Pro Rata Repurchase of Common Stock, then the Exercise Price shall be

reduced to the price determined by multiplying the Exercise Price in effect

immediately prior to the Effective Date of such Pro Rata Repurchase by a fraction

of which the numerator shall be (i) the product of (x) the number of shares of

Common Stock outstanding immediately before such Pro Rata Repurchase and (y)

the Market Price of a share of Common Stock on the trading day immediately

preceding the first public announcement by the Company or any of its Affiliates

of the intent to effect such Pro Rata Repurchase, minus (ii) the aggregate purchase

price of the Pro Rata Repurchase, and of which the denominator shall be the

product of (i) the number of shares of Common Stock outstanding immediately

prior to such Pro Rata Repurchase minus the number ofshares of Common Stock

so repurchased and (ii) the Market Price per share of Common Stock on the

trading day immediately preceding the first public announcement by the Company

or any of its Affiliates of the intent to effect such Pro Rata Repurchase. In such

event, the number of shares of Common Stock issuable upon the exercise of this

Warrant shall be increased to the number obtained by dividing (x) the product of

(1) the number of Shares issuable upon the exercise ofthis Warrant before such

adjustment, and (2) the Exercise Price in effect immediately prior to the Pro Rata

Repurchase giving rise to this adjustment by (y) the new Exercise Price

determined in accordance with the immediately preceding sentence. For the

avoidance of doubt, no increase to the Exercise Price or decrease in the number of

Shares issuable upon exercise ofthis Warrant shall be made pursuant to this

Section 13(E).

(F) Business Combinations. In case of any Business Combination or

reclassification of Common Stock (other than a reclassification of Common Stock

11
referred to in Section 13(B)), the Warrantholder's right to receive Shares upon

exercise of this Warrant shall be converted into the right to exercise this Warrant

to acquire the number of shares of stock or other securities or property (induding

cash) which the Common Stock issuable (at the time of such Business

Combination or reclassification) upon exercise of this Warrant immediately prior

to such Business Combination or reclassification would have been entitled to

receive upon consummation of such Business Combination or reclassification;

and in any such case, if necessary, the provisions set forth herein with respect to

the rights and interests thereafter of the Warrantholder shall be appropriately

adjusted so as to be applicable, as nearly as may reasonably be, to the

Warrantholder's right to exercise this Warrant in exchange for any shares of stock

or other securities or property pursuant to this paragraph. In determining the kind

and amount of stock, securities or the property receivable upon exercise of this

Warrant following the consummation of such Business Combination, ifthe

holders of Common Stock have the right to elect the kind or amount of

consideration receivable upon consummation of such Business Combination, then

the consideration that the Warrantholder shall be entitled to receive upon exercise

shall be deemed to be the types and amounts of consideration received by the

majority of all holders of the shares of Common Stock that affirmatively make an

election (or of all such holders if none make an election).

(G) Rounding of Calculations; Minimum Adjustments. All calculations

under this Section 13 shall be made to the nearest one-tenth (Ill Otb) of a cent or

to the nearest one-hundredth (IIlOOth) of a share, as tbe case may be. Any

provision of this Section 13 to the contrary notwithstanding, no adjustment in the

Exercise Price or the number of Shares into which this Warrant is exercisable

shall be made if the amount of such adjustment would be less than $0.01 or onetenth (lIlOth) of a share of Common Stock, but any such amount shall be carried

forward and an adjustment with respect thereto shall be made at the time of and

together with any subsequent adjustment which, together with such amount and

any other amount or amounts so carried forward, shall aggregate $0.01 or 11l0th

of a share of Common Stock, or more.

(H) Timing of Issuance of Additional Common Stock Upon Certain

Adjustments. In any case in which the provisions of this Section 13 shall require

that an adjustment shall become effective immediately after a record date for an

event, the Company may defer until the occurrence ofsuch event (i) issuing to the

Warrantholder of this Warrant exercised after such record date and before the

occurrence of such event the additional shares of Common Stock issuable upon

such exercise by reason of the adjustment required by such event over and above

the shares of Common Stock issuable upon such exercise before giving effect to

such adjustment and (ii) paying to such Warrantholder any amount of cash in lieu

of a fractional share of Common Stock; provided, however, that the Company

upon request shall deliver to such Warrantholder a due bill or other appropriate

instrument evidencing such Warrantholder's right to receive such additional

shares, and such cash, upon the occurrence of the event requiring such adjustment.

12
(I) Other Events. For so long as the Original Warrantholder holds this

Warrant or any portion thereof, if any event occurs as to which the provisions of

this Section 13 are not strictly applicable or, if strictly applicable, would not, in

the goodJaith judgment of the Board of Directors of the Company, fairly and

adequately protect the purchase rights ofthe Warrants in accordance with the

essential intent and principles of such provisions, then the Board of Directors

shall make such adjustments in the application of such provisions, in accordance

with such essential intent and principles, as shall be reasonably necessary, in the

good faith opinion of the Board of Directors, to protect such purchase rights as

aforesaid. The Exercise Price and the number of Shares into which this Warrant is

exercisable shall not be adjusted in the event of a change in the par value ofthe

Common Stock (other than pursuant to the Charter Amendment) or a change in

the jurisdiction of incorporation of the Company.

(J) Statement Re!!arding Adjustments. Whenever the Exercise Price or

the number of Shares into which this Warrant is exercisable shall be adjusted as

provided in Section 13, the Company shall forthwith file at the principal office of

the Company a statement showing in reasonable detail the facts requiring such

adjustment and the Exercise Price that shall be in effect and the number of Shares

into which this Warrant shall be exercisable after such adjustment, and the

Company shall also cause a copy of such statement to be sent by mail, first class

postage prepaid, to each Warrantholder at the address appearing in the Company's

records.

(K) Notice of Adjustment Event. In the event that the Company shall

propose to take any action of the type described in this Section 13 (but only if the

action of the type described in this Section 13 would result in an adjustment in the

Exercise Price or the number of Shares into which this Warrant is exercisable or a

change in the type of securities or property to be delivered upon exercise of this

Warrant), the Company shall give notice to the Warrantholder, in the manner set

forth in Section 13(1), which notice shall specify the record date, if any, with

respect to any such action and the approximate date on which such action is to

take place. Such notice shall also set forth the facts with respect thereto as shall be

reasonably necessary to indicate the effect on the Exercise Price and the number,

kind or class of shares or other securities or property which shall be deliverable

upon exercise of this Warrant. In the case of any action which would require the

fixing of a record date, such notice shall be given at least 10 days prior to the date

so fixed, and in case of all other action. such notice shall be given at least 15 days

prior to the taking of such proposed action. Failure to give such notice, or any

defect therein, shall not affect the legality or validity of any such action.

(L) Proceedings Prior to Any Action Requiring Adjustment. As a

condition precedent to the taking of any action which would require an adjustment

pursuant to this Section 13, the Company shall take any action which may be

necessary. including obtaining regulatory, New York Stock Exchange or

stockholder approvals or exemptions. in order that the Company may thereafter

validly and legally issue as fully paid and nonassessable all shares of Common

13
Stock that the Warrantholder is entitled to receive upon exercise of this Warrant

pursuant to this Section 13.

(M) Adjustment Rules. Any adjustments pursuant to this Section 13

shall be made successively whenever an event referred to herein shall occur. If an

adjustment in Exercise Price made hereunder would reduce the Exercise Price to

an amount below par value of the Cornmon Stock, then such adjustment in

Exercise Price made hereunder shall reduce the Exercise Price to the par value of

the Common Stock.

14. Exchange. At any time following the date on which the shares of

.Common Stock of the Company are no longer listed or admitted to trading on a

national securities exchange (other than in connection with any Business

Combination), the Original Warrantholder may cause the Company to exchange

all or a portion of this Warrant for an economic interest (to be determined by the

Original Warrantholder after consultation with the Company) of the Company

classified as permanent equity under U.S. GAAP having a value equal to the Fair

Market Value of the portion of the Warrant so exchanged. The Original

Warrantholder shall calculate any Fair Market Value required to be calculated

pursuant to this Section 14, which shall not be subject to the Appraisal Procedure.

15. No Impairment. The Company will not, by amendment of its

Charter or through any reorganization, transfer of assets, consolidation, merger,

dissolution, issue or sale of securities or any other voiuntary action, avoid or seek

to avoid the observance or performance of any of the terms to be observed or

performed hereunder by the Company, but will at all times in good faith assist in

the carrying out of all the provisions of this Warrant and in taking of all such

action as may be necessary or appropriate in order to protect the rights of the

Warrantholder.

16. Governing Law. This Warrant, and the rights and obligations

of the parties hereunder, shall be governed by, and construed and

interpreted in accordance with, United States federal law and not the law of

any State. To the extent that a court looks to the laws of any State to

determine or define the United States federal law, it is the intention of the

parties hereto that such court shall look only to the laws of the State of New

York without regard to the rules of conflicts of laws. Each of the Company

and the Warrantholder agrees (a) to submit to the exclusive jurisdiction and

venue of the United States District Court for the District of Columbia for any

action, suit or proceeding arising out of or relating to this Warrant or the

transactions contemplated hereby, and (b) that notice may be served upon

the Company at the address in Section 20 below and upon the

Warrantholder at the address for the Warrantholder set forth in the registry

maintained by the Company pursuant to Section 9 hereof. To the extent

permitted by applicable law, each oftheCompany and the Warrantholder

hereby unconditionally waives trial by jury in any legal action or proceeding

relating to the Warrant or the transactions contemplated hereby or thereby.

14
17. Binding Effect. This Warrant shall be binding upon any successors

or assigns of the Company.

18. Amendments. This Warrant may be amended and the observance

of any term of this Warrant may be waived only with the written consent of the

Company and the Warrantholder.

19. Prohibited Actions. The Company agrees that it will not take any

action which would entitle the Warrantholder to an adjustment of the Exercise

Price if the total number of shares of Common Stock issuable after such action

upon exercise of this Warrant, together with all shares of Common Stock then

outstanding and all shares of Common Stock then issuable upon the exercise of all

outstanding options, warrants, conversion and other rights, would exceed the total

number of shares of Common Stock then authorized by its Charter.

20. Notices. Any notice, request, instruction or other document to be

given hereunder by any party to the other will be in writing and will be deemed to

have been duly given (a) on the date of delivery if delivered personally, or by

facsimile, upon confirmation ofreceipt, or (b) on the second business day

following the date of dispatch if delivered by a recognized next day courier

service. All notices hereunder shall be delivered as set forth below, or pursuant to

such other instructions as may be designated in writing by the party to receive

such notice.

If to the Company:

American International Group, Inc.

70 Pine Street

New York, New York 10270

Attention: Chief Financial Officer:

Secretary:

Treasurer:

with a copy to:

Sullivan & Cromwell LLP

125 Broad Street

New York, NY 10004

Attention Robert W. Reeder, III

Michael M. Wiseman

If to the Warrantholder:

United States Department ofthe Treasury

1500 Pennsylvania Avenue, NW, Room 2312

Washington, D.C. 20220

15
Attention: Assistant General Counsel (Banking and Finance)

Facsimile: (202) 622-1974

with a copy to:

Davis Polk & Wardwell

450 Lexington Avenue

New York, NY 10017

Attention: John Brandow

21. Entire Agreement. This Warrant contains the entire agreement

between the parties with respect to the subject matter hereof and supersede all

prior and contemporaneous arrangements or undertakings with respect thereto.

[Remainder ofpage intentionally left blank]

16
[Form of Notice of Exercise]

Date: _

TO: American International Group, Inc.

RE: Election to Purchase Common Stock

The undersigned, pursuant to the provisions set forth in the attached

Warrant, hereby agrees to subscribe for and purchase the number of shares of the

Common Stock set forth below covered by such Warrant. The undersigned, in

accordance with Section 3 of the Warrant, hereby agrees to pay the aggregate

Exercise Price for such shares of Common Stock in the manner set forth below. A

new warrant evidencing the remaining shares of Common Stock covered by such

Warrant, but not yet subscribed for and purchased, if any, should be issued in the

name set forth below.

Number of Shares of Common Stock _

Method of Payment of Exercise Price (note if cashless exercise pursuant to

Section 3(i) of the Warrant or cash exercise pursuant to Section 3(ii) of the

Warrant, with consent of the Company and the Warrantholder) _

Aggregate Exercise Price:

Holder:

By:

Name:

Title:
IN WITNESS WHEREOF, the Company has caused this Warrant to be

duly executed by a duly authorized officer.

Dated: November [ ],2008

AMERICAN INTERNATIONAL

GROUP, INC.

By:

Name:

Title:

Attest:

By:

Name:

Title:

[Signature Page to Warrant]



f}Je{aware

IJ1ie !First State

PAGE 1

I, HARRIET SMITH WINDSOR, SECRETARY OF STATE OF THE STATE OF

DELAWARE, DO HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT

COpy OF THE CERTIFICATE OF DESIGNATION OF "AMERICAN

INTERNATIONAL GROUP, INC.", FILED IN THIS OFFICE ON THE

TWENTY-FOURTH DAY OF NOVEMBER, A.D. 2008, AT 5:39 O'CLOCK P.M.

A FILED COpy OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE

NEW CASTLE COUNTY RECORDER OF DEEDS.

0658607 8100

081142393

You may veritY this certificate online at corp. delaware. govI authver. shtml

Harriet Smith Windsor, Secretary of State

AUTHENTICATION: 6986222

DATE: 11-24-08
FROM RL&.F #7

State or Delaware

Secretary of Stats

Divi"ion or COlPOration.s

Delivered OS:39 PM 11./24/2008

FIlED 05:39 PM 11/24/2008

SRV OBIl42393 - 0658607 FIU

(~CN)11.24'0818:40/ST,lE:39INO.49649000ElJ 2

CERTIFICATE OF DESIGNATIONS

OF

"Common Stock" means the common stock, par value $2.50 per share, ofthe

SERIES D FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK

OF

AMERICAN INTERNATIONAL GROUP, INC.

American International Group, Inc., a corporation organized and exi:.lling under the

GeneraI Corporation T..aw ot'the State of Delaware (the "Cgmpany"). hereby certifies that the

following resolution was adopted by the Board ofDirectors ofthe Company (the "Board of

Directors") as required by Section 151 ofthe General Corporation Law ofthe State ofDelaware

at a meeting duly held on November 19, 2008.

RESOLVED, that pursuant to the authority granted to and vested in the Board of

Directors in accordance with the provisions ofthe Restated Certificate of Incorporation, as

amended, the Board ofDirectors hereby creates a series ofSerial Prel'erred Stock, par value

$5.00 per share, ofthe Company, and hereby states the designation and number ofshares, and

llXesthe voting and other powers, and the relative rights and preferences. find the qualificallons,

limitations and restrictions thereof, as follows:

Series D Fixed Rate Cumulative Perpetual Preferred Stock:

Part 1. Designation and Number of Shares. There is hereby created out ofthe authorized

and unissued shares ofsenal pre::ft:rred stock ofthe Compml)' II. serics of preferred .stock

designated as the "Series D Fixed Rate Cumulative Petpetual Preferred Stock" (the "Seri~ 0

Preferred Stock"). The authorized number ofshares ofthe Series D Preferred Stock shall be

4,000,000. Such number ofshares may be decreased by resolution ofthe Board of Directors,

subject to the terms and conditions hereof; provided that no decrea.s~ shall reduce the number of

shares ofthe Senes D Preferred Stock to a number less than the nwnber ofshares then

outstanding.

Part 2. Standard Provisions. The Standard Provisions contained i.n Annex A attached

hereto are incorporated herein by reterence in their entirety and shall be deemed to he a part of

this Certificate ofDesignations to the same exten1 as ifsueh provisions had been set forth in full

herein.

Part. 3. Definitions. The following tenns are used in this Certitlcate of Designations

(including the Standard Provisions in Annex A hereto) as defined below:

(a)

Company.

(b) "Convertible Preferred Stock" means the Series CPerpetual, Convertible,

Participating Preferred Stock of the Company. The Convertible Prererred Stock shall be Parity
FROM RL&F ~7 (MCN)11. 24'08 18:40/ST, 16:39/NO, 4364900061 J 3

Stock; provided that the Convenib1e Preferred Stock shall be Junior Stock following the

effectiveness of an amendment tu the Charter to allow die Series D .Preferred Stock to rank

senior to the Convertible Preferred Stock as to dividends rights and/or right!\ upon the

liquidation, dissolution and V\inding up (the "Amendment").

(c) "Dividend Payment Date" means February 1, May 1, AUBusl 1 and November 1

ofeacb year.

(d) "Junior Stock" means the Common Stock, the Convertible Preferred Stock

(following the Amemlmenl) and an)' other class or series ofstock ofthe Company the tenns of

which expressly provide that it ranks junior to the Series D Preferred Stock as to dividend rights

and/or as to rights on liquidation, dissolution or winding up ofthe Company.

(e) "Liguidation Amount" means $10,000 per share ofthc Series D Preferred Stock.

(f) "Pgity Stock" means the Convertible Preferred Stock (before the Amendment)

and any class orseries ofstock ofthe Company (oilier than the Series D Pretetred Stock) the

terms ofwhich do not expressly provide that such class or series will rank senior orjunior to the

Series D Preferred Stocle fl.$ to dividend rights andlor as to rights on liquidation, dh.solution or

winding up ofthe Company (in each case without regard to whether dividends aecrue

cwnulatively or non-cumulativcly).

(h) "Signing Date" means November 24,2008.

Part. 4. Certain Voting Matters. Whether the vote or consent ofthe holders of a plw-ality,

majority or other portion ofthe shares ofthe Series 0 Prcfcned Stock and any Voting Parity

S10ck has been cast or given on any matter on which the holders ofshares ofthe Series D

Preferred Stock and any Voting Pmty Stock are entitled to vote OT consent together as a class

shall be determined by the Company by reference to the specified liquidation amount ofthe

shares ofthe Series D Preferred Stock voted or with respect to which a consenl hus been received

as ifthe Company were liquidated on the record date torsuch vote or con~ent, if any, 01', in the

absence of a record date, on the date for such vote llr consent. For purposes of determining the

voting rights ofthe holders ofthe Series 0 Preferred Stock under Section 7 ofthe Standard

PTOvisiorui fonning part ofthis Certificate ofDesignations, each holder will be entitled to one

vote for cllch $10.000 ofliquidation preference to whioh such holder's shares are entitled.

[Remainder ofPage intentionally Left Blank]

2
FROM RL&F #7 (MCN)I1.24'0818:41!ST.lc:39/NO,486490DOEt J 4

IN WITNESS 'WHEREOF, the Company has caused this Certificate ot' Designations to

be signed on its behalf by iu Executive Vice President and ChiefFinancial Officer and attested

by its Secretary this 24th day ofNovember. 2008.

American In~ma1iona1 Group, Inc.

By: lsi David L. Herzog

Name: David L. Herzog

Title: Executive Vice President

and ChiefFinancial Officer

ArrEST:

lsi Kathleen E. Shannon

Name: Kathleen E. Shannon

Title: Senior Vice President and Secretary

3
FROM RL&F #7 (MeN) 11. 24' OB 18: 41/ST, 18: 39/NO. 49649000E1 J 5

ANNEXA

STANDARD PROVISIONS

Section 1. General Matters. Each share ofthe Series 1) Preferred Stock shall be identical

in all respec15 to every other share ofthe Series D Preferred Stock. The Series D PrefeL't'ed Stock

shall be perpetual. subject to the provisions ofSection 5 ofthese Standard Provisions that fonn a

.part ofthe Certificate ofDesignations. The Series D Preferred Stock (a) shall rank seniorto the

Junior Stock in respect ofthe right to receive dividends and the right \0 receive pa}ments out of

the l:Il$S~ts oftht: Cumpuny upon volunLlII)' orinvolunlary liquidalitm) dissolution OJ winding up

ofI.he Company and (h) shall be ofequal rank with Parity Stock as to t.hc right to re<;eive

dividends and the right to receive payments out ofthe assets ofthe Company \.lpon voluntary or

involuntary liquidation) dissolution or winding up ofthe Company.

Section 2. Standard Definitions. As used herein with respect to the Series D Preferred

Stock:

(8) "Applicable Dividend Ratel' means 10% per annum.

(b) "Business Combination" means a merger, consolidation, statutory share exchange

or similar transaction that requires the approval ofthe Company's stockholders.

(0) "Business DaY" means any day except Saturda.y. Sunday and any day on which

banking iJl!>1.itutions in the State ofNew York generally are authorized or required by law or

other governmental actions to close.

(d)

to time.

''Bylaws'' means the bylaws ofthe Company, Q.'i they may be amended from time

(e) "Cerlificate ofDesignations" meansthe Certificate ofDesignations or compara"ble

instrument relating to the Series D Preferred Stock. ofwhich these Standard Provisions fonn a

p~ as it may be amended from tlme to time.

(f)

amended.

(g)

. (b)

"Charter" mems the Company's Resta.ted Certificate ofIncorporn-tion. as

"Dividend P~riDd" has the meaning set forth in Section 3(a),

"Dividend Record Dat~" has the meaning set forth in Seeti.on 3(a).

(i) "Original Issue Date" means the date on which shares ofthe Series 0 Prefened

Stock are first ;f;l\lued.

(j) "Preferred Directqr" has the rneaning set forth in Section 7(b).

(k) "preferred Stock" means any and all series ofserial preferred stock ofthe

Company, including the Series D Preferred Stock.

A-I
FROM RL&F #7

(1)

(~CN)l1. 24'08 18:411ST.1S:39,1NO. 4364900081 j 6

"Share Dilution Amount" has the meaning set forth in Section 3(b).

(m) "Standard Provision!!" mean the..~e Standard Provisions that fonn a part ofthe

Certificate ofDesignations relating to the Series 0 Preferred Stock.

(n) "Trust" means the AIG Credit Facility Trust

(0) ''Votin"g Parity Stock" means, with regard to any matter as to which the holders of

the Series 0 Preferred Stock are entitled to vote as speciiied in Sections 7(a) and 7(b) ofthese

Standard Provisions thAt form a part ofthe Certificate ofDesignzrtiol1s, any and all ~eries of

Parity Stock upon which like voting rights have been confelTed and a1'e exerciRahle with re.qpect

to such matter.

Scction 3. Dividends.

(a) ~. Holders ofthe Series D Preferred Stock shall be entitled to receive, on each

snare ofthe Series DPretelTcd Stock if, as and '\'lInen declared by the Board of Directors or any

duly authorized committee ofthe Board ofDircctors, but only out ofassets legally available

therefor, cumulative cash dividends with respect to each Dividend Period (as defined below) at a

rate per annum equal to the Applicable Dividend Rate on (i) the Liquidation Amount per share of

the Series D Preferred Stock and (ii) the amount ofaccrued and unpaid dividends for any prior

Dividend Period OIl such shan: oftlre Smes D Preferred Stock, ifany. Such dividends shall

begin to accme and be cumulative from the Oribrinal Issue Date, shall compound on each

subsequent Dividend Payment Date (i.e., no dividends shall ac(.."l"UC on other dividends unless and

until the" fIrst Dividend Payment Date for such other dividends has passed \\ithout such other

dividends having been paid on such date) and shall be payable quarterly in arrears on eaeh

Dividend Payment Date. commencing with the f11'St such Dividend Payment Date to occur at

least 20 calendar duys after the Original Issue Date. Inthe event that any Dividend Payment

Date would otherwise fall on a day that is not a Business Day, the dividend p"clyment due on that

date will be postponed to 1he next day that is a Business Day and no addition.'\l dividends will

accrue as a result ofthat postponement. The period from and including any Dividend Payment

Date to. but excluding, the next Dividend Payment Date is a '~Dividcnd Period", provided that

the initial Dividend Period shall be the period from and including the Original Issue Date to. but

excluding, the nel't Dividend Payment Date.

Dividends that are payable on Series 0 Preferred Stock in respect of any Dividend Period

shall be computed on the basis of a 360-day year consisting oftwelve 30-day months. The

amount of dividends payable on Series D Preferred Sto<:k on any date prior to the end of a

Dividend Period, and for the initial Dividend Period, shZlll be computed on the basis of a 360-day

year consisting oftwelvc: 3o-day months, and actual days elapsed over a 30-day month.

Dividends that are payable on Series D Preferred Stock on any Dividend Payment Date

win be payable to holders ofrecord ofthe Series 0 Pecfen-ed Stock as they I1ppear on the stock

.register ofthe Company on the applicable record date. whi.ch shall he the 15ih calendar day

immediately preceding such Dividend Payment Date or such other record date fixed by the

Board ofDirectors or any duly authorized committee ofthe Board ofDirectors that is not more

than 60 nor less than 10 days prior to such Dividend Payment Date (each, a "Dividend Record

A-2
FROM RL&F #7 (MeN) 11. 24'1)8 18:41/ST.16:39/NO. 4364900061 ") 7

Date"). Any such day that is a Dividend Record Date shalt be a Dividend Recol'd Date whether

or DOL such day is a Business Day.

Holders ofthe Series D Preferred Stock shall not be entitled to any dividends, whether

payable in cash, securities or other property, other than dividends (ifany) declared and payable

on the Series D Preferred Stock as specified in this Section 3 (subject to the otner provisions of

the Certificate ofDesignations).

(b) fFiority ofDividends. So long as any share ofthe Series D Prefened Stock

remains outstanding, no dividend or distribution shall be declared or paid on the Common Stock

or any other shares ofJunior Stock (ot1ler than dividends payable solely in shares ofCommon

Stock) or Parity Stock, subject to the immediately following paragraph in the case ofParity

Stock, and no Common Stock. Junior Stock or Parity Stock shall be, directly or indirectly,

purchased, redeemed (')1' othetv>'ise acquired for consideration by the Corporatlon or any ofit$

subsidiaries unless nIl accrued and unpaid dividends for nll past Dividend Periods, incillding the

latest completed Dividend Period (including, ifapplicable as provided in Section 3(a) above.

dividends On such amount). on all ou~ianding shares ofthe Series D Preferred Stock have been

or are contemporaneously declared and paid in full (or have been declared and a sum sufficient

fOT \he paymentlht:reofhas been :lelw:lide fur lhtl bw~1it ofthe holders ufshares ofthe Series D

Preferred Stock on the applicable record date). The foregoing1imitation shall not apply to (i) 8

dividend payable on any Junior Stock in shares of any other Junior Stock. or to the acquisition of

shares ofany Junior Stock in exchange for. or through application ofthe proceeds ofthe sul~ of.

shares ofany otherJunior Slock; (it) redemptions, purchases or other acquisitions ofshares of

Common Stock Or other Junior Stock in connection 'With the administration ofany employee

benefit plan in the ordinary course of business (including purchases to offset the Share Dilution

Amount (as ddined below) pursuant to a publicly anuounced repurchase plan) and consistent

with past practice, pravidedthat any purchases to offset the Share Dilution AmOlUlt shaH in no

event exceed the Share Dilution Amount; (iii) any dividends or distnoutions ofrights orJunior

Stnd in connection with a stockholders' rights plan or any redemption or repurchase ofrights

pUI'Smlnl \0 any stockholders' rightS plan; (iv) the acqulsitIon by the Company or any ofits

subsidiaries ofrecord ownership in Junior Stock or Parity Stock for the beneficial ownership of

all)' otha ~r.sonll (otht:t than lht; COlporation or any ofits subsidiluics), including as tJ.'ustees or

custodians; and (v) \.he exchange or conversion ofJunior Stock for or iJ:Jro other Junior Stock or

ofParity Stock for or into other Parity Stock (with the same or lesser aggregate liquidation

amount) or Junior Stock, in each case, solely to the extent required pursuant to binding

contractual agreements entered into prior to the Signing Date or any subsequent agreement for

the accelerated exercise, settlement or exchange thereoffor Common Stock. "Share Dilution

Amount" means the increase in the number of diluted shares outstanding (determined in

aL'Cordance with generally accepted accounting principlesin the United States. and as measured

from the date ofth.e Company's consolidated tinancial statements most l'ecently filed with the

Securities and Exchange Commission prior to the Original Issue Delte) resulting from the grant,

vesting or exercise of equity-based compensation to employees and equitably adjusted for any

stock split, stock dividend, reverse stock split, reclassification or similar transaction.

When dhidends are not paid (01' declared and a sum sufficient for payment thereoflief

aside for the benefit ofthe holders thereof on the applicable record date) on any Dividend

Payment Date (or, in the: case ofParity Stock having dividend payment dates different from the
(~CN) \1. 24' 08 18:411ST. 18 :391NO. 4964900081 J 8

Dividend Payment Datest on a dividend payn:~ent dat('J falling within a Dividend Period related to

such Dhidend Payment Date) in full upon the Series D Preferred Stock and any shares ofParity

Stock, all dividends declared on "the Series D Preferred Stock and all such Parity Stock and

payable: on such Dividend Payment Date (or. in the case ofParity Stock having dividend

payment dates differc:nt from the Div1dend Payment Dates. on a dividend payment date falling

within the Dividend Period related to such Dividend Payment Date) shall be declared pro rata so

that the respective amounts ofsuch dividends declared shall bear the same ratio 10 each other as

all accrued and unpaid dividends per share on the ~hares ofthe Serle,; n Preferred Stock

(including, ifapplicable as provided in Section 3(a) above, dhridends llO such amount) and all

Parity Stock payable on such Dividend Payment Date (or. in the case ofParity Stock having

divideml ptl)'ment dale!;! different from the Dividend Payment Dates, on a dividend payment date

falling within the Dividend Period related to such Dividend Payment Date) (subject to "their

having been declared by the Board ofDirectors or a duly authorized committee ofthe Board of

Directors out oflegally available funds and including, in the case ofParlty Stock that bears

cwnulative dividends, all accrued but unpaid dividends) bear to each other. Ifthe Board of

Directors or fl duly authorized committee ofthe BOlU'd ofDirectors dctennincs not to pay any

dividend C1r a full dividend on a Dividend Payment Date. the Company will provide written

notice to the holders Qrthe Series D Preferred Stock priorto such Dividend Payment Date.

Subjeot to the foregoing, and not otherwise. such dividends (paya.ble in cllSh, securities Or

other property) as may be determined by the Board ofDirectors or any duly authorized

committee ofthe Board ofDirectors may be declared and paid on any securities, including

Common Stock and other Junior Stock, from time to time out of any funds legally available for

such payment. and holders ofthe St;ric;s D Preferred Stock shall not be entitled to participa.te in

any such dividends.

Section 4. Liquidation. Dissolution Or Winding Up. In the event of any voluntary or

involuntary liquidation, dissolution or winding up ofthe affairs ofthe Company, then, before any

distribution or payment shall be made to the holders ofJunior Stock. the holders ofthe Series 0

Preferred Stock and any shares ofPreferred Stock ranking on a parity therewith as to liquidation

shall be entitled to be paid in full the respective amounts ofthe liquidation preferences thereof,

which in the case: ofth~ Series D Preferred Stock shall be $10,000.00 per share. plus an amount

equal to all accrued and unpaid dividendsto such disnibution or payment date. whether or not

earned Or declared (inCluding, if applicable. as provided it) Section 3(a) above, dividends on such

accrued and unpaid dividends for all prior Dividend Periods). Ifsuch paymen111hall have been

made in full to the holders ofthe Series D Preferred Stock and any series of }'referred Stock.

ranking on a parity therewith as to liquidation, the remaining assets and fundli ofthe Company

shall be distributed among the holders ofJunior Stock. according to their respeclive rights and

preferences and in each case according tc their respective shares. If. upon any liquidation,

dissolution or winding up ofthe affairs oftbc Company, the amounts so payable are not paid in

full to the holders of all outstanding shares oftbe Series D Preferred Stock and any series of

Preferred Stock ranking On a parity therewith 8.';; to liquidation. the holders ofthe Seriell D

Preferred Stock and any series ofPreferred Stock ranking on a pality therewith as to liquidation

shalJshare ratably in any distribution ofassets in proportion to the full amounts to which they

would otherwise be respectively entitled. Neither the consolidation or merger ofthe Company,

nor the sale,. lease at' conveyance ofall or a part ofits assets. shall be decmod a liquidation.

11.-4
FROM RLH #7 (~CN) 11. 24' 08 18: 421ST. 18: 39/NO. 4364900081 ) 9

dissolution or winding up ofthe affairs ofthe Company within the meaning ofthe foregoing

pro'Visions oithis Seedon 4.

Section 5. Redemption.

(a) Optional Redemption. Except as provided in this Section 5(11), the Designated

Preferred Stock shall not be redeemable. At any time that (i) the Trost (or any successor entity

established for the benefit ofthe United States Treasury) 'lbeneficiaHy owns" less than 30% of

the aggregate voting power ofthe Company's voting securities and (ii) no holder of'the Series D

Pn£:m:u Stuck oontrull:i the CumpanYt the Company may redeem, in whole or in part. at any

tinte and from time to time, out offunds legally available therefor. the shares ofthe Series D

Preferred Stock at the time outstanding, upon notice given as provided in Section S(c) below. the

series 0 Preferred Stock in whole Ot in part at a redemption price e<lual to 100% ofits

Liquidation Amount, plus, except as set forth in the last sentence ofthe next paragraph, an

amount equal to all accrued and unpaid dividenck to such redemption date (including, if

applicable. as provided in Section 3{a) above. dividends on accrued and unpaid dividends for aU

prior Dividend Periods). "Control" for purposes ofthis Section Sea) means the power to direct

the management and policies ofthe Company, directly or indirectly, whether through the

ownership of voting securities, by contract, by the power to control the Board of Directors or

otherwise. "Beneficially ownit for purposes ofthill Section 5(a) is defined in RuJ.e l3d-3 under

the Securities Exchange Act of 1934, as amended to the Signing Date. POI the avoidance of

doubt, while there is BOlU'd ofDirectors control (or 'the potential to gain Board ofDirectors

control as a result of existing contracmal rights) by any bolder ofthe Series D Preferred StOCk,

the Company may not redeem any ofthe Series D Preferred Stock.

The redemption price for any sbares ofthe Series D Preferred Stock shall be payable on

the redemption date to the holder ofsuch sbares againstsurrender ofthe ccrtificatc(s) evidencing

such shares to the Company or its agent. Any declared but unpaid dividends payable on a

redemption date that occurs subsequent to the Dividend Record Date for a Dividend Period shall

not be paid to the holder entitled to receive the redemption price on the redemption date, but

rather shall be paid to the bolder ofrecord ofthe redeemed shares on such Dividend Record Date

relating to the Dividend Payment Date as provided in Section 3 above.

(b) No Sinking Fund. The Series D Preferred Stock will not be subject to any

mandatory redemptiOn, Sinking fund or othel' similar provi!Tions. Holders ofthc Series D

Preferred Stock will have no right 10 require redemption or repurchase ofany shares ofthe Series

D Preferred Stock.

(c) NOlice or Redemption. Notice of ellery redemption ofshares ofthc Series D

Preferred Stock shall be given by first class mail. postage prepaid, addressed to the holders of

record of1he sharesto be redeemed at their respective last addresses appearitlg on the books of

tbe Company. Such mailing shall be at least 30 days and notmore than 60 days before the date

tixed tor redemption. Any notice mailed as proVided in this Subsection shall be conclusively

presumed to have been duly given. whether or not the hoJdcrrcccives such notice, but failure

duly 10 give such notice by mail, or any defect in such notice or in the mailing thereof, to any

holder ofshares ofthe Series D Preferred Stock designated for redemption shall not affect the

validity ofthe proceedings for the redemption ofany other shares ofthe Series D Preferred

A-S
FROM RL&F #7 (}ACN)11. 24' 08 18:42/ST.IE:39/NO. 4864900061 ':l 10

Stock. Notwithstanding the foregoing, ifshares ofthe Series D Preferred Stock are issued in

book-entry form Ihmugh The Depo!>itory Ttm.1 Corporation or any other similar facility, notice

of:redemption may be given to the holders ofthe Series D Preferred Stock at such time and in

any manner permitted by such fhcility. Each notice of ~demptiongiven to a holder shall state:

(1) the redemption date; (2) the nwnber ofshares ofthe Series D Preferred Stock to be redeemed

and, iflessthan all the shares held by sucb. holcler are to be redeemed, the number ofsuch shares

to be redeemed from such holder; (3) the redemption price; and (4) the place or places where

certificate!; for such shares are to be surrendered for payment ofthe redemption price, but failure

duly to give such notice to any holder ofshares ofthe Series D Preferred Stock designated for

redemption or any defect in such notice shall not affect the validity ofthe proceedings for the

redemption ofao.y other shares ofthe Series D PrefoITtld Slock.

(d) Partial Redemption. fu case ofany redemption ofpart of(he shares ofthe Series

D Preferred Stock at the time outstanding, the shares to be red.eemed shall be selected either pro

rulu or in such other manner as the Board ofDireetors or a duly authorized committee thereof

may detemrine to be fair and equitable. Subject to the provisions hereof, the Board ofDirectors

or a duly author-i:t.ed committee thereofshall have full power and authority to prescribe the terms

and conditions upon which shares ofthe Series D Preferred StQCk shall be redeemed from time to

time. Iffewer than all the shares represented by any certificate are redeemed, a new certificate

shall be issued representing the unrede.emed shares without charge to the holder thereof.

(c) Effectiveness of Redemption. Ifnotice ofredemption ha.q been duly given and if

on or before the redemption date specified inthe notice all funds necessary tor 1he redemption

have been deposited by the Company. in trust for the pro rata benefit ofthe holders ofthe shares

called for redemption, with a bank or 1mst company doing business in the Borough of

Manhattan. The City ofNew York, and ha.ving a capital and surpluB of at least $500 million and

selected by the Board oflJirectors. so as to be and continue to be available solely therefor. then,

notwithstanding that any certificate for any share so called for redemption has not been

surrendered for cancellation, on and after the redemption date dividends shall cease to accrue on

aU Sh~5 so called for redemption, all shares so called for redemption shall no longer bo deemed

outstanding and all rights with respect to such shares shall forthwith on such redemptiun date

cease and temlinate, except only the right oithe holders thereofto lweivt the amount payable on

such redemption from such bank or trust company, without interest. Any funds uncla;med at the

end ofthree years from the redemption date shalt.. to the extent pennitted by law, be released to

the Company, after which time the holders ofthe shares so called for redemption slu'tll Jook only

to the COlnpany for payment ofthe redemption price ofsuch shares.

(1) Sta1us ofRedeemed Shares. Shares ofthe Series 0 Preferred Stock that are

rt:deemc::d. repUIChased or otherwise acquiIedby the Company shall revert to authorized but

unissued shares ofthe Series D Preferted Stock (provided that any such cancelled shares ofthe

Series D Preferred Slock may be reissued only as shares ofany series ofthe Serie.. D Preferred

~"1ock other than the Series D Preferred Stock).

Section 6. Conversion. Holders oftb.e Series D Preferred Sl.l.lC'k l)harc::s shall have no right

to exchange or convert such shares into any other securities.

Section 7. yQtlng Rights.
FROM RL&F #7 NCN) 11. 24' 08 18: 42/ST. 1e:39;NO. 4864900081 ? 11

(a) Geneml. The holders ofthe Series 0 Preferred Stock shan not have any voting

rights except as set forth below or as otherwise from time to time required by law.

(b) Series D Preferred Stock Directors. Whenever, at any time or times, dividends

payable on the shares ofthe Series D Preferred Stock have not been paid for an aggregate offour

quarterly Dividend Periods or more, whether or not consecutive, "the authorized number of

directors ofthe Company shall automatically be increasedto accommodate the number ofthe

Preferred DiRctors spetified below and the holders ofthe Sctil:S D Preferred Stock shall have

the right, with hoMers ofshares ofanyone or more other classes or series of Voting Parity Stock

outstanding at the time, voting together as a clas$, to elect the greater oftwo directors and a

nwnbcr of directors (rounded upward) equal to 20% ofthe total number of directors ofthe

Company nfte( giving effect to such election (hereinafter the "Preferred Directors" and each a

"Preferred Director") to fill such newly created directorships at the: Company's next annual

meeting ofstockholders (or at a special meeting called for that plitp(lse prit}f 10 such neKt annual

meeting) and at each subsequent annual meeting orslockhuldlm:! unlil all aCl.TUt:d liTld unpaid

dividends for all past Dividend Periods, including the latest cOIn:pleted Dividend Period

(including. if applicable as provided in Section 3(a) above) dividends on such amount), on all

outstanding shares ofthe Series D Preferred Stock have been declared and paid in full at which

time such right shall terminate with respect to the Series D Preferred Stock. except as herein or

by Jaw expressly provided. subject to revesting in the event of each and every subsequent

payment failure ofthe characteI above mentioned; provided that it shall be a qualification for

election for any Preferred Directorthat the election ofsuch PreCerred Director shall not cause the

Company to violate any corporate governance requirements of any securities exchange or o1l1er

trading facility on which securities ofthe Company may tl.1en be listed or traded that listed or

traded companies must have a majority ofindependent WreQtors. Upon any termination ofthe

right ofthe holders ofshares ofthe Series D Preferred Stock and Voting Parity Stock as a class

to vote for directors as provided above, the Preferred Directors shall cease to be qualified as

directors, the lc:nn of offiCI;: of all 'Prc;feued Directors then in (Jffice llhal1 lenninale immediatdy

and the authorilred number of directors shall be reduced by the number ofthe Preferred Diretto1'$

elected pursuant hereto. Any Preferred Director may be removed at any time, with or without

cause, and any vacancy created thereby may be :filled. only by the aftirmativc vote ofthc holders

a majority ofthe shares ofthe Series D Preferred Stock at the time outslanding voting separately

as a classtogether with the holders ofshares ofVoting Parity Stock, to the extent the voting

rights ofsuch holders described. above are then exercisable. Ifthe office ofany Preferred

Director becomes vacant for any reason otherthan removal from office as aforesaid~ the

remaining Preterred Director may choose a successor who shall hold office tor the unexpired

terOl in respect ofwhich sllch vacal)cy occurred.

(c) Class Voting RhIDts as to Particpl8l' Matters. So )ong as any shares ofthe Series D

Preterred Stoele are outstanding~ in addition to any other vote or consent ofstockholders rc:quired

by law or by the Charlet. the vote or consent otthc holders of at lca.<rt 662/3% ofthe slwes of

the Series D Preferred Stock at the time outstanding. voting as a separate class. given in person

or by proxy, either in writing without a meeting or by vote at an)' nleeting caned for the purpose,

shall be necessary for effecting or validating~

(i) A\lthorization ofSenior or Pari Pa..'§U Stock. Any amendment or alteration

ofthe Certificate ofDesignations for the Series D Preferred Stock or the Charterto

A·7
(~CN) 11. 24' 08 18: 43/ST. 1e:39/NO. 43649000e1 :l 12

authorize or create or increase the authorized amount of, or any issuance of. any shares

of. or any securities convertible into or exchangeable or exercisable for shares of. any

class orseries ofcatJital stock ofthe Company ranking senior to or pad passu with Series

D Preferred Stock with respect to either or both the payment 0('dividends and/or the

djstribution of assets on any liquidation, dissolution or winding up ofthe Company;

provided that no such vote or consent ofthe holders ofthe Series D Preferred Stock shall

be required fur the issuance ofthe Convertible Preferred Stock,

(il) Amendment ofthe Series D Preferred Stock. An.y amendment. alteration

or repeal ofany provision ofthe Certificate ofDesignations for the Series D Preferred

Stock orthe Charter (including, unless no vote on such merger or consolidation is

required by Section 7(c)(iil) below. any amendment,. alteration onepeal hy means ofa

merger, consolidation or ~therwise) so as to adversely affect the rightCl, preferences,

privileges or yoting powers ofthe Series D Preferred Stock: or

(iii) Share Exchanges. Reclassifications. Mergers and Consolidations, Any

consummation ofa binding share exchange or reclassification involving the Series D

Preferred Stoek~ or ofa merger or consolidation ofthe Company with or into another

corporation or othtll entily1 unless in each case (x) the shares ofthc Series 0 Preferred

Stock remain 0l11standing and are not amended in any respect or, in the case of any such

merger or consolidation with respect to which the Company is not the surviving OT

resulting entity. are converted into or exchanged for preference securities ofthe sw-viving

or resulting entity or its ultimate puent. and (y) such shares remaining outstanding or

such preference securities. as the case may be, have such right'il preferences. privileges

and voting powers. and limitations and restrictions thereof, taken as a whole, as are not

materially less favorable to the holdersthereofthan the rights, preferences, privileges and

voting powers, and limitations and restrictionsthereof. ofthe Series D Preferred Stock

immediately prior to such c;onsmnmatiDXlt taken lU a whole;

provided, hqwever. that for all pw-poscs ofthis Section 7{e), any incrtmse in the amount ofthe:

authorized Preferred Stock. including any increase in the authorized amount ofthe Series D

Preferred Stock necessary to sa.tisfy preemptive or similarrights granted by the Company to

other persons prior to the Signing Date. orthe creation and issuance. OT an increase inthe

authorized or issued amount. whether pursuantto preemptive orsimilar rights or otherwise, of

any otherseries ofthe Preferred Stock., or any securities convertible into or exchangeable OJ'

exercisable for any other scnes oftbe P.re!en'ed Stock, nmkingjuniol' to the Series D Preferred

Stock with respect to the payment ofdividends (whether such dividends are ctunulative or non~

cumulative) and the distribution of assets upon liquidation,. dissolution or winding up ofthe

Ctlmpany will not h~ deemed to adversely affect the rights, preferences, privileges or voting

powers, and shall not require the affirmative vote or consent of, the holderS ofoutstanding shares

ofthe Series D Preferred Stock.

(d) gbangcs after PTovisjon tOr Redem,ption. No vo1e or consent ofthe holders ofthe

Series D Preferred Stock shall be required pursuant to Section 7(0) above i~ at or prior to the

time when any such vote or consent would othetwise be required pursuant to such Section. all

outstanding shares oftile Series D Preferred Stock shall have been redeemed, or shall have been

A-8
FROM RL&F #7 NCN) t1. 24' 08 18: 43/ST, 1e:39/NO. 4364900081 :l 13

called tor redemption upon proper notice and sufficient funds shall have been deposited. in trUl:lt

for such redemption, in each case pursuant to Section 5 above.

(e) Procedures for Voting and Consents. The rules and procedures t01' call1ngand

conducting any meeting ofthe holders ofthe Series D Preferred Stock (including) without .

limitation, the fixing of a. record date in connection therewith), the solicitation and use ofproxies

at sueh a meeting. the obtaining of written consents and any other aspect OT maHer with regard to

such a meeting OJ such consents shall be governed by any rules ofthe Board of Directors or any

duly authorized oouunittee ofthe Board ofDirectors, in its discretion, may adopt from time to

time. which rules and procedures shall conformto the requirements ofthe Charter. the Bylaws.

and applicable law and the rules ofany national securities exchange or other trllding facility on

which Series P .Preferred Stock is listed or traded at the time.

Section 8. Record Holders. To the fullest extent permitted by applicable law, the

Company ond the trnnsfe.r agent for Series D PrefelTed Stock may deem and treat thc record

holder ofany share ofthe Series D Preferred Stock as the true and lawful owner thcrcoffor all

purposes, and neither the Company nOr sueh transfer agent shall be affected by any notice to the

contrary_

Section 9. Notices. All notices 01 communicatioll$ in respect ofthe Series D Preferred

Stock shall be sufficiently given ifgiven in writing and delivered in person or by first class mail,

postage prepaid, or if given in such other manner as may be permitted in this Certificate of

Designations, in the Charter or Bylaws or by applicable law. Notwithstanding the foregoing, if

snares ofthe Series D Prefened Stock are issued in bookMcntry form thrmlgh The Depository

Trm.'tCompany OT any similar facility, such notices may be given to the holders ofthe Series D

Preferred Stock in any manner permitted by such facility.

~ection 10. No Preemptive Rights. No holder ofthe Series D Preferred Stock shall be

entitled as a matter ofright to subscribe for or purchase, or have any preemptive right with

respect to. any part of any new or additional issue ofstock of any class whatsoever, or of

securities convertible into any stock ofany class w'hl:l.\.$Oover, whether now or hereafter

authorized and whether issued for cash or other cons:ideration or by way of dividend.

Section ll. Replacement Certificates. The Company shall replace any mutilated

certiticate at the holder's ex.pense upon surrend~ ofthat certificate to the Company. The

Company shall replace certificates that become destroyed, stolen or lost at the holder's expense

upon delivery to the Company ofreasonably satisfactory evidence that the certitlcate has been

destroyed, stolen or lost, together with any indemnity that may be reasonably required by the

Company.

Section 12. Fonn.

(l:I.) The Series D Preferred Stock shall be initially issued inthe form of onc or more

certificates in definitive. fully registered form with. untl1 such time as otherwise detennined by

the Company, the restrioted shares legend (the "Restricted Shates Legend"), as set forth on the

form ofthe Seri.es D Preferred Stock attBched hereto as Exhibit A (each, a "Series D Preferred

Share Certificate"), which is hereby incorporated in and expressly made a pan ofthls Certificate

A-9
FROM RL&F #7 (MeN) I!. 24'08 18:43/ST.1S:39/NO. 48649000S1 :l 14

ofDesignations. The Series D Preferred Share Certificate may have notations, legends or

endorsementsrequired by law. stock exchange rules. agreernellts to which the Company is

subject, ifany, or usage (provided that any such notation, legend or endorsement is in a form

acceptable to thc Company).

(b) AT] Officer shall sign the Saies D Preferred Share Certjficate fOr the Company, in

accordance with the Company's Bylaws and applicable law, by manual or 1:acsimile signature.

"Officer" means the Chainnan, any Vice President. the Treasurer or the Secretary ofthe

Company.

(c) Ifan Officer whose signature is on a Series D Preferred Share Certificate no

longer holds that office at the time the ofthe issuance ofsuch Series DPreferred Share

Certiticate, such Series D Pretened Share Certificate shall be valid never/hele!!!!.

(d) A Series D Preferred Share Certificate shall not be valid or obligatory until an

authorized signatory nfthe Transfer Agent manually countersigns the Series D Preferred Share

Certi.licate. The signatu1'e shall be conclusive evidence that such Series D Preferred Share

Certificate has been authentica.ted under this Certificate ofDesignations. Each Seties D

Preferred Share Certificate shall be dnted the date ofits authentication.

Other than upon original issuance, all transfers and exchanges ofthe Designateo

Preferred Stock shall be made by directregistration on the books and records of the Company.

Section 13. Transfer Agent And Registrar. The duly appointed Transfer Agent and

Registrar for the Series D Preferred Stock shall be Wells Fargo Bank, N.A. The Company may.

in its sale discretion, remove the Transfer Agent in accordance \\ith the agreement between "the

Company and the Transfer Agent; provided that the Company shAll appoint a successor traru;fer

agent who shall accept such appointment priorto the effectiveness ofsuch removal.

Section 14. Other Rights. The shares oftbe Series D Preferred Stock shall nothavc

any rights, preferences, privileges or voting powers or relative. partioipating, optional or other

special rights. or qualifications, limitations or restrictions thereof, olher than as set forth herein or

in the Charter or as provided by applicable law.

A-IO
FEOM RL&F #7 (MCNlt 1. 24' 08 18: 43/81 1e:39!NO. 4364900081 ? 15

EXHIBIT A

FORM OF SERIES D FIXED RATE CUMULATIVE PERPETIJAL PREFERRED STOCK

($10,000 LIQUIDATION PREFERENCE)

NUMBER

L--.-__1'---__J SHARES

4,000,000

CUSll' [L-_~-...

AMERICAN INTERNATIONAL GROUP, INC.

INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE

THIS CERTIF1CATE IS TRANSFERABLE

IN THE CITY OF NEW 'YORK, NEW YORK

THE SECURlTffiS REPRESENTED BY THIS INSTRUMENT HAVB NOT BEEN

REGISTERED UNDBR THE SECURITIES ACT OF 1933. AS AMENDED (THE

"SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE

TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A

REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT

AND APPLlCAl:3LJ:! STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION

FROM REGISTRATION UNDER SUCII ACT OR SUCH LAWS. EACH PURCHASER OF

THE SECURITIES REPRESENTED BY THIS lNSTRUMENT IS NOTIFIED THAT THE

SELLER MAY BE RELYING ON THE EXEMPTION FROM SECTIO~ 5 OF THE

SECUlUTlBS ACT PROVIDED BY RULE 144A THEREUNDER. ANY TRANSFEREE OF

THE SECURITIES REPRESENTED BY THIS INSTRUMENT BY ITS ACCEPTANCE

HEREOF (l) REPRESENTS THAT IT IS A "QUALIFIED INS'f!TUTIONAL BUYER" (AS

DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (2) AGREES TEAT IT WILL

NOT OFFER., SELL OR OTHERWISE TRANSFER. TliB SECURITIES REPRESENTED BY

TH1S INSTRUMENT EXCEPT (A) PUR.SUANT TO A REGISTRATlON STATEMENT

WHICH IS THEN EFFECTIVE UNDER THE SECURITIES ACI. (B) FOR SO LONG AS

THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE ELIGffiLE FOR

RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A

"QUALIFIED INSTITUTIONAL BUYERtt AS DEFINED IN RULE 144A UNDER THE

SECURITIES ACT TIIAT PURCHASES FORITS OWN ACCOUNT OR FOR THE

ACCOUNT OF A QUALIFIED INSTlTOTIONAL BUYER TO WHOM NOTICE IS GIVEN

THAT THE TRANSFER lS BEING MADE IN RELIANCE ON RULE 144A, (C) TO THE

ISSUER OR (D) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE

REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT

IT WILL GIVE TO EACH PERSON TO WHOM THE SECURITIES REPRESENTED BY

THIS rNSTRUMENT ARE TRANSFERRED A NOTICE SUBSTANT1ALLY TO THE

EFFECT OF THIS LEGEND.

This is to certify that the UNITED STATES DEPARTMENf OF TH ETREASURY is

the owner ofFOUR MilLION (4,000.000) fully paid and non-assessable shares ofSeries D

Fixed Rate Cumulative Perpetual Preferred Stock, $5.00 par value, liquidation preference .

A.I
FROM RL&,F #7 (~CN)l1.24J0818:44/ST.la:39/NO,436490DOel? 16

$10,000 per share (the "Stock"), ofthe American Tntemational Group. Inc. (the "Company',),

transferable on the books ofthe Company by the holder hereofin person or by duly authorized

attorney upon surrender ofthis certificate properly endorsed.

This certificate is not valid 01' obligatory for any purpose unless countersigned and

registered by the l-ransfer Agent and Registrar.

Witness the facsimile seal ofthe Company and the facsimile signatures ofits duly

authorized officers.

Dated: November_' 2008

Name:

Title:

Name:

Title:

Countersigned and Registered

--:~--::--~---:=-=---:--"

as Transfer Agent and Registrar

Authori7..cd Sigt1L\ture

By: -------,-,,..------,,..--------

A-2
FROM RL&F #7 (MeN) 11.24' 08 18:44/ST. IE: 39/NO. 4364900081 ? 17

AMERICAN INTERNATIONAL GROUP, INC.

AMERICAN INTERNATIONAL GROUP; INC. (the "Company") will fumi5h, without clmrge to each

stockholder who so requests, a copy of 1I1e certificate of designations establishIng the powers, preferences and

relative, participa.ting, optional or ather !lpecial rights (If each clllJ:l$ of $toek (lfthe Company or seriesthereof and the

qualifications, limitations or restrictions ofsuch preferenct& and/or ri~ht:s l'.ppli(:llble to each class of stock of the

Company or series thereof. Such Information may be ab18lned by a request In writIng to the Secrcrary M thc

Company at its principal place ofbusiness.

ThIs certificate and the share or sb8l'e!l represented hereby are issued and shill! be held subject to all ofthe

provisions oftbe Company's Restated Certificate of.mCOTpoTiltion, as amended, amd the Certificate ofDesigmltioD5

ofthe Selies D Fixed Rate Cumulative Perpetual Preferred Stock (Llquidlltion Preference 3110.000 pershare) (copies

ofwhich arc on file with the Transfer Ageut), to .11 ofwhich the holder, by ncceptallce: hel'eof, a$~ellb.

TIle following abbreviations, when used In the inscription on the fice ofthis CertinC8.1e. shall be con'>tTUed

118 though they werc written out in fuJI to applicable laws 0l'loegulatlon5:

TEN COM· lli tenants ill common

TEN ENT - as tenants by the entil'etle$

JTTEN - asJoint tenants with right of

survivorship and not as

tenants in COltUnOll

UNIF GIFT MIN ACT- CustodlS1l

(Millor) (Cust)

under Unirorm Gills lO MiI1Q~ Act

(StUlll)

-- -_.... '.'---------------

Additional a.bbreviations may al",o be L11'ied though not in the aho....e Ii~t.

For value received, hereby sell(s), assign(s) and lransIer(s) unto

PLEASE INSERT SOCIAL SECURITY OR OTHER

IDENTIFYING NUMBER OF ASSIGNEE

PLEASE PRlNT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE

shares of the capital ''Stock' represented by 'the within certificate, and do(es) hereby·""'iJTe,--v-ocn--=bly COI1Stitute and appoint

----:o--c---,--,..,....-J' AttOJl\ey to transfer the said stock 01\ the books ofthe withi" named Company with

full power ofsubstitution in the premises.

A-3
FROM RL&F #7

Daled _

SIGNATURE GUARANTEED

NCN) 11. 24' 08 18: 44/ST. 1c: 39/NO. 4864900081 J 16

Signature

NOT1CB: Tho signature 10 this assignment must correspond

with tbe nllJlJe as written upon the face ofthis

certific81e in evCf)' pllrticular. withoul

alteration or enll11'gement or an} change whatever.

NOTICE: The signature(s)should be

guaranteed by an eligible ~lor

institution (banks, sto~kbrokers. savings

lIud lOllJl ~SS() ciatioJllt, I1nd credit unions

with membership In an approved signature

guaranl<lt medallion program), pUl'llutl11t to

R~lc 17Ad-I S under the Securltic~

Exchange Act of 1934.

A-4


SERIES D FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK

($10,000 LIQUIDATION PREFERENCE)

NUMBER

1

SHARES

4,000,000

CUSIP 026874818

AMERICAN INTERNATIONAL GROUP, INC.

INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE

THIS CERTIFICATE IS TRANSFERABLE

IN THE CITY OF SOUTH ST. PAUL, MINNESOTA

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN

REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE

"SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE AND MAY

NOT BETRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE

A REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER

SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO

AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS.

EACH PURCHASER OF THE SECURITIES REPRESENTED BY THIS

INSTRUMENT IS NOTIFIED THAT THE SELLER MAY BE RELYING ON THE

EXEMPTION FROM SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE

144A THEREUNDER. ANY TRANSFEREE OF THE SECURITIES REPRESENTED

BY THIS INSTRUMENT BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT

IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A .

UNDER THE SECURITIES ACT), (2) AGREES THAT IT WILL NOT OFFER, SELL

OR OTHERWISE TRANSFER THE SECURITIES REPRESENTED BY THIS

INSTRUMENT EXCEPT (A) PURSUANT TO A REGISTRATION STATEMENT

WHICH IS THEN EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO LONG

AS THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE ELIGIBLE

FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY

BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE

144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN

ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER

TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN

RELIANCE ON RULE 144A, (C) TO THE ISSUER OR (D) PURSUANT TO ANY

OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION

REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL

GIVE TO EACH PERSON TO WHOM THE SECURITIES REPRESENTED BY THIS

INSTRUMENT ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE

EFFECT OF THIS LEGEND.
This is to certify that the UNITED STATES DEPARTMENT OF THE

TREASURY is the owner ofFOUR MILLION (4,000,000) fully paid and non-assessable

shares of Series D Fixed Rate Cumulative Perpetual Preferred Stock, $5.00 par value,

liquidation preference $10,000 per share (the "Stock"), ofthe American International

Group, Inc. (the "Company''), transferable on the books ofthe Company by the holder

hereofin person or by duly authorized attorney upon surrender ofthis certificate properly

endorsed.

This certificate is not valid or obligatory for any purpose unless countersigned and

registered by the Transfer Agent and Registrar.

Witness the facsimile seal ofthe Company and the facsimile signatures ofits duly

authorized officers.

Dated: November 25,2008

:J:J-:Jl~~ Name:

Title:

~l,ML.,f!*1'fV111K..;

Name:

Title:

COUNTERSIGNED AND REGISTERED:

WELLS FARGO BANK, NA.,

TRANSFER AGENT AND REGISTRAR

BY:~~· ? AUTHORIZED SIGNATURE
AMERICAN INTERNATIONAL GROUP, INC.

AMERICAN INTERNATIONAL GROUP, INC. (the "Company") will furnish, without charge to

each stockholder who so requests,. a copy of the certificate of designations establishing the powers,

preferences and relative, participating, optional or other special rights of each class of stock of the

Company or series thereof and the qualifications, limitations or restrictions of such preferences and/or

rights applicable to each class ofstock ofthe Company or series thereof. Such information may be obtained

by a request in writing to the Secretary ofthe Company at its principal place ofbusiness.

This certificate and the share or shares represented hereby are issued and shall be held subject to

all of the provisions of the Company's Restated Certificate of Incorporation, as amended, and the

Certificate of Designations of the Series D Fixed Rate Cumulative Perpetual Preferred Stock (Liquidation

Preference $10,000 per share) (copies of which are on file with the Transfer Agent), to all of which the

holder, by acceptance hereof, assents.

The following abbreviations, when used in the inscription on the face of this certificate, shall be

construed as though they were written out in full to applicable laws or regulations:

TEN COM - as tenants in common

TEN ENT - as tenants by the entireties

IT TEN - as joint tenants with right of

sUIVivorship and not as

tenants in common

UNIF GIFT MIN ACT-Custodian

(Minor) (Cust)

under Uniform Gifts to Minors Act

(State)

Additional abbreviations may also be used though not in the above list.

For value received, hereby sell(s), assign(s) and transfer(s) unto

PLEASE INSERT SOCIAL SECURITY OR OrnER IDENTIFYING NUMBER OF ASSIGNEE

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE

___________________,--- shares

of the capital stock represented by the within certificate, and do(es) hereby irrevocably constitute and

appoint , Attorney to transfer the said stock on the books or-the within named

Company with full power ofsubstitution in the premises.
Dated. _

Signature

NOTICE: The signature to this assignment must correspond

with the name as written upon the face ofthis

certificate in every particular, without

alteration or enlargement or any change whatever.

SIGNATURE GUARANTEED

NOTICE: The signature(s) should be

guaranteed by an eligible guarantor

institution (banks, stockbrokers, savings

and loan associations, and credit unions

with membership in an approved signature

guarantee medallion program), pursuant to

Rule 17Ad-IS under the Securities

Exchange Act of 1934.


WARRANt TO PURCHASE COMMON STOCK

THE SECURITIES REPRESENTED BY TIllS INSTRUMENT HAVE NOT

BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS

AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT

BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT

WHILE A REGISTRATION STATEMENT RELATING THERETO IS IN

EFFECT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES

LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION

UNDER SUCH ACT OR SUCH LAWS. THIS INSTRUMENT IS ISSUED

SUBJECT TO THE RESTRICTIONS ON TRANSFER AND OTHER

PROVISIONS OF A SECURITIES PURCHASE AGREEMENT BETWEEN

THE ISSUER OF THESE SECURITIES AND THE INVESTOR REFERRED

TO THEREIN, A COpy OF WHICH IS ON FILE WITH THE ISSUER. THE

SECURITIES REPRESENTED BY TIllS INSTRUMENT MAY NOT BE SOLD

OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID

AGREEMENT. ANY SALE OR OTHER TRANSFER NOT IN COMPLIANCE

WITH SAID AGREEMENT WILL BE VOID.

WARRANT

to purchase

53,798,766

Shares of Common Stock

of AMERICAN INTERNATIONAL GROUP, INC.

Issue Date: November 25, 2008

1. Definitions. Unless the context otherwise requires, when used

herein the following terms shall have the meanings indicated.

"Affiliate" has the meaning ascribed to it in the Purchase Agreement.

"Appraisal Procedure" means a procedure whereby two independent

appraisers, one chosen by the Company and one by the Original Warrantholder,

shall mutually agree upon the determinations then the subject of appraisal. Each

party shall deliver a notice to the other appointing its appraiser within 15 days

after the Appraisal Procedure is invoked. Ifwithin 30 days after appointment of

the two appraisers they are unable to agree upon the amount in question, a third

independent appraiser shall be chosen within 10 days thereafter by the mutual

consent ofsuch first two appraisers. The decision ofthe third appraiser so

appointed and chosen shall be given within 30 days after the selection ofsuch

third appraiser. Ifthree appraisers shall be appointed and the detennination ofone

appraiser is disparate from the middle determination by more than twice the

amount by which the other determination is disparate from the middle

determination, then the determination ofsuch appraiser shall be excluded, the

(NY) 0786SfOO2ITARPfAIG.wanant.doe 11109108 10:50 PM
remaining two determinations shall be averaged and such average shall be binding

and conclusive upon the Company and the Original Warrantholder; otherwise, the

average of all three determinations shall be binding upon the Company and the

Original Warrantholder. The costs ofconducting any Appraisal Procedure shall be

borne by the Company.

"Board ofDirectors" means the board ofdirectors ofthe Company,

including any duly authorized committee thereof

"Business Combination" means a merger, consolidation, statutory share

exchange or similar transaction that requires the approval ofthe Company's

stockholders.

"business day" means any day except Saturday, Sunday and any day on

which banking institutions in the State ofNew York generally are authorized or

required by law or other governmental actions to close.

"Capital Stoc!c' means (A) with respect to any Person that is a corporation

or company, any and all shares, interests, participations or other equivalents

(however designated) of capital or capital stock ofsuch Person and (B) with

respect to any Person that is not a corporation or company, any and all partnership

or other equity interests ofsuch Person.

"Charter" means, with respect to any Person, its certificate or articles of

incorporation, articles of association, or similar organizational document.

"Charter Amendment' means the amendments to the Company's Restated

Certificate ofIncorporation to reduce the par value ofthe Common Stock to

$0.000001 per share and increase the number of authorized shares ofCominon

Stock to 19 billion.

"Common StoclC' has the meaning ascribed to it in the Purchase

Agreement.

"Company" means the American International Group, Inc.

"conversion" has the meaning set forth in Section B(C).

"convertible securities" has the meaning set forth in Section 13(C).

"Exchange Ad' means the Securities Exchange Act of 1934, as amended,

or any successor statute, and the rules and regulations promulgated thereunder.

"Exercise Price" means, with respect to this Warrant, initially, $2.50, and

upon the effectiveness ofthe Charter Amendment, the amended par value per

share ofCommon Stock.

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"Expiration Time" has the meaning set forth in Section 3.

"Fair Market Value" means, with respect to any security or other property,

the fair market value ofsuch security or other property as determined by the

Board ofDirectors, acting in good faith or, with respect to Section 14, as

determined by the Original Warrantholder acting in good faith. For so long as the

Original Warrantholder holds this Warrant or any portion thereof, it may object in

writing to the Board ofDirector's calculation offair market value within 10 days

ofreceipt ofwritten notice thereof. Ifthe Original Warrantholder and the

Company are unable to agree on fair market value during the IO-day period

following the delivery ofthe Original Warrantholder's objection, the Appraisal

Procedure may be invoked by either party to determine Fair Market Value by

delivering written notification thereofnot later than the 30th day after delivery of

the Original Warrantholder's objection.

"Governmental Entities" has the meaning ascribed to it in the Purchase

Agreement.

"Initial Number" has the meaning set forth in Section B(C).

"Issue Date" means November 25, 2008.

"Market Price" means, with respect to a particular security, on any given

day, the last reported sale price regular way or, in case no such reported sale takes

place on such day, the average ofthe last closing bid and ask prices regular way,

in either case on the principal national securities exchange on which the

applicable securities are listed or admitted to trading, or ifnot listed or admitted to

trading on any national securities exchange, the average ofthe closing bid and ask

prices as furnished by two members ofthe Financial Industry Regulatory

Authority, Inc. selected from time to time by the Company for that purpose.

''Market Price" shall be determined without reference to after hours or extended

hours trading. Ifsuch security is not listed and traded in a manner that the

quotations referred to above are available for the period required hereunder, the

Market Price per share ofCommon Stock shall be deemed to be (i) in the event

that any portion ofthe Warrant is held by the Original Warrantholder, the fair

market value per share ofsuch security as determined in good faith by the

Original Warrantholder or (ii) in all other circumstances, the fair market value per

share ofsuch security as determined in good faith by the Board ofDirectors in

reliance on an opinion of a nationally recognized independent investment banking

corporation retained by the Company for this purpose and certified in a resolution

to the Warrantholder. For the purposes ofdetennining the Market Price ofthe

Common Stock on the ''trading day" preceding, on or following the occurrence of

an event, (i) that trading day shall be deemed to commence immediately after the

regular scheduled closing time oftrading on the New York Stock Exchange or, if

trading is closed at an earlier time, such earlier time and (ii) that trading day shall

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end at the next regular scheduled closing time, or iftrading is closed at an earlier

time, such earlier time (for the avoidance of doubt, and as an example, ifthe

Market Price is to be determined as ofthe last trading day preceding a specified

event and the closing time oftrading on a particular day is 4:00 p.m. and the

specified event occurs at 5:00 p.m. on that day, the Market Price would be

detennined by reference to such 4:00 p.m. closing price).

"Original Warrantholder" means the United States Department ofthe

Treasury. Any actions specified to be taken by the Original Warrantholder

hereunder may only be taken by such Person and not by any other Warrantholder.

"Permitted Transactions" has the meaning set forth in Section l3(C).

"Person" has the m.eaning given to it in Section 3(a)(9) ofthe Exchange

Act and as used in Sections l3(d)(3) and 14(d)(2) ofthe Exchange Act.

"Per Share Fair Market Value" has the meaning set forth in Section l3(D).

"Preferred Shares" means the perpetual preferred stock issued to the

Original Warrantholder on the Issue Date pursuant to the Purchase Agreement.

"Pro Rata Repurchases" means any purchase ofshares ofCommon Stock

by the Company or any subsidiary thereofpursuant to (A) any tender offer or

exchange offer subject to Section 13(e) or 14(e) ofthe Exchange Act or

Regulation 14E promulgated thereunder or (B) any other offer available to

substantially all holders ofCommon Stock, in the case ofboth (A) or (B), whether

for cash, shares ofCapital Stock ofthe Company, other securities ofthe Company,

evidences ofindebtedness ofthe Company or any other Person or any other

property (including, without limitation, shares ofCapital Stock, other securities or

evidences ofindebtedness of a subsidiary), or any combination thereof, effected

while this Warrant is outstanding. The "Effective Date" of a Pro Rata Repurchase

shall mean the date ofacceptance ofshares for purchase or exchange by the

Company under any tender or exchange offer which is a Pro Rata Repurchase or

the date ofpurchase with respect to any Pro Rata Repurchase that is not a tender

or exchange offer.

"Purchase Agreemenf' means the Securities Purchase Agreement, dated

as ofNovember 25,2008, as amended from time to time, between the Company

and the United States Department ofthe Treasury, including all annexes and

schedules thereto.

"Regulatory Approvals" with respect to the Warrantholder, means, to the

extent applicable and required to permit the Warrantholder to exercise this

Warrant for shares ofCommon Stock and to own such Common Stock without

the Warrantholder being in violation of applicable law, rule or regulation, the'

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(NY) 078651002ITARPIA1G.wanalll..doc 11109108 10:50 PM
receipt of any necessary approvals and authorizations of, filings and registrations

with, notifications to, or expiration or tennination ofany applicable waiting

period under, the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as

amended, and the rules and regulations thereunder.

"SEC' means the U.S. Securities and Exchange Commission.

"Securities Ad' means the Securities Act of 1933, as amended, or any

successor statute, and the rules and regulations promulgated thereunder.

"Shares" has the meaning set forth in Section 2.

"trading day" means (A) ifthe shares ofCommon Stock are not traded on

any national or regional securities exchange or association or over-the-counter

market, a business day or (B) ifthe shares ofCommon Stock are traded on any

national or regional securities exchange or association or over-the-counter market,

a business day on which such relevant exchange or quotation system is scheduled

to be open for business and on which the shares ofCommon Stock (i) are not

suspended from trading on any national or regional securities exchange or

association or over-the-counter market for any period or periods aggregating one

halfhour or longer; and (ii) have traded at least once on the national or regional

securities exchange or association or over-the-counter market that is the primary

market for the trading ofthe shares ofCommon Stock.

"US. GAAP" means United States generally accepted accounting

principles.

"Warrantholder" has the meaning set forth in Section 2.

"Warrant' means this Warrant, issued pursuant to the Purchase

Agreement.

2. Number ofShares; Exercise Price. This certifies that, for value

received, the United States Department ofthe Treasury or its permitted assigns

(the "Warrantholder'') is entitled, upon the terms and subject to the conditions

hereinafter set forth, to acquire from the Company, in whole or in part, after the

receipt of all applicable Regulatory Approvals, if any, up to an aggregate of

53,798,766 fully paid and nonassessable shares ofCommon Stock, at a purchase

price per share ofCommon Stock equal to the Exercise Price. The number of

shares ofCommon Stock (the "Shares") and the Exercise Price are subject to

adjustment as provided herein, and all references to "Common Stock," "Shares"

and ''Exercise Price" herein shall be deemed to include any such adjustment or

series ofadjus1ments.

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3. Exercise ofWarrant; Term. Subject to Section 2, to the extent

permitted by applicable laws and regulations, the right to purchase the Shares

represented by this Warrant is exercisable, in whole or in part by the

Warrantholder, at any time or from time to time after the execution and delivery

ofthis Warrant by the Company on the date hereof, but in no event later than 5:00

p.m., New York City time on the tenth anniversary ofthe Issue Date (the

"Expiration TIme'), by (A) the surrender ofthis Warrant and Notice ofExercise

annexed hereto, duly completed and executed on behalfofthe Warrantholder, at

the principal executive office ofthe Company located at 70 Pine Street, New

York, New York 10270 Attention: ChiefFinancial Officer (or such other office or

agency ofthe Company in the United States as it may designate by notice in

writing to the Warrantholder at the address ofthe Warrantholder appearing on the

books ofthe Company), and (B) payment ofthe Exercise Price for the Shares

thereby purchased:

(i) by having the Company withhold, from the shares ofCommon

Stock that would otherwise be delivered to the Warrantholder upon such exercise,

shares ofCommon Stock issuable upon exercise ofthe Warrant equal in value to

the aggregate Exercise Price as to which this Warrant is so exercised based on the

Market Price ofthe Common Stock on the trading day on which this Warrant is

exercised and the Notice ofExercise is delivered to the Company pursuant to this

Section 3, or

(ii) with the consent ofboth the Company and the Warrantholder, by

tendering in cash, by certified or cashier's check payable to the order ofthe

Company, or by wire transfer ofimmediately available funds to an account

designated by the Company.

Ifthe Warrantholder does not exercise this Warrant in its entirety, the

Warrantholder will be entitled to receive from the Company within a reasonable

time, and in any event not exceeding three business days, a new warrant in

substantially identical form for the purchase ofthat number of Shares equal to the

difference between the number ofShares subject to this Warrant and the number

ofShares as to which this Warrant is so exercised. Notwithstanding anything in

this Warrant to the contrary, the Warrantholder hereby acknowledges and agrees

that its exercise ofthis Warrant for Shares is subject to the condition that the

Warrantholder will have first received any applicable Regulatory Approvals.

4. Issuance ofShares; Authorization; Listing. Book-entries

representing Shares issued upon exercise ofthis Warrant will be promptly

recorded in such name or names as the Warrantholder may designate. The

Company hereby represents and warrants that any Shares issued upon the exercise

ofthis Warrant in accordance with the provisions of Section 3 will be duly and

validly authorized and issued, fully paid and nonassessable and free from all taxes,

liens and charges (other than liens or charges created by the Warrantholder,

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(NY) 0786SIOO2ITARP/AlG.wanutdoc: 11109/08 10:50 PM
income and franchise taxes incurred in connection with the exercise oithe

Warrant or taxes in respect of any transfer occurring contemporaneously

therewith). The Company agrees that the Shares so issued will be deemed to have

been issued to the Warrantholder as ofthe close ofbusiness on the date on which

this Warrant and payment ofthe Exercise Price are delivered to the Company in

accordance with the terms ofthis Warrant, notwithstanding that the stock transfer

books ofthe Company may then be closed. The Company will at all times reserve

and keep available, out ofits authorized but unissued Common Stock, solely for

the purpose ofproviding for the exercise ofthis Warrant, the aggregate number of

shares ofCommon Stock then issuable upon exercise ofthis Warrant at any time.

The Company will (A) procure, at its sole expense, the listing ofthe Shares

issuable upon exercise ofthis Warrant at any time, subject to issuance or notice of

issuance, on all principal stock exchanges on which the Common Stock is then

listed or traded and (B) maintain such listings ofsuch Shares at all times after

issuance. The Company will use reasonable best efforts to ensure that the Shares

may be issued without violation of any applicable law or regulation or of any

requirement of any securities exchange on which the Shares are listed or traded.

5. No Fractional Shares or Scrip. No fractional Shares or scrip

representing fractional Shares shall be issued upon any exercise ofthis Warrant.

In lieu of any fractional Share to which the Warrantholder would otherwise be

entitled, the Warrantholder shall be entitled to receive a cash payment equal to the

Market Price ofthe Common Stock on the last trading day preceding the date of

exercise less the pro-rated Exercise Price for such fractional share.

6. No Rights as Stockholders; Transfer Books. This Warrant does not

entitle the Warrantholder to any voting rights or other rights as a stockholder of

the Company prior to the date ofexercise hereof. The Company will at no time

close its transfer books against transfer ofthis Warrant in any manner which

interferes with the timely exercise ofthis Warrant.

7. Charges. Taxes and Expenses. Issuance ofShares to the

Warrantholder upon the exercise ofthis Warrant shall be made without charge to

the Warrantholder for any issue or transfer tax or other incidental expense in

respect ofthe issuance ofsuch Shares, all ofwhich taxes and expenses shall be

paid by the Company.

8. Transfer/Assignment

(A) Subject to compliance with clause (B) ofthis Section 8, this

Warrant and all rights hereunder are transferable, in whole or in part, upon the

books ofthe Company by the registered holder hereofin person or by duly

authorized attorney, and a new warrant shall be made and delivered by the

Company, ofthe same tenor and date as this Warrant but registered in the name of

one or more transferees, upon surrender ofthis Warrant, duly endorsed, to the

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(NY) 07865IOO2!l'ARP/AIG.wamntdoc 11/09/08 10:SO PM
office or agency ofthe Company described in Section 3. All expenses (other than

stock transfer taxes) and other charges payable in connection with the preparation,

execution and delivery ofthe new warrants pursuant to this Section 8 shall be paid

by the Company.

(B) The transfer ofthe Warrant and the Shares issued upon exercise of

the Warrant are subject to the restrictions set forth in Section 4.4 ofthe Purchase

Agreement. If and for so long as required by the Purchase Agreement, this

Warrant shall contain the legends as set forth in Section 4.2(a) ofthe Purchase

Agreement.

9.. Exchange and Registry ofWarrant. This Warrant is exchangeable,

upon the surrender hereofby the Warrantholder to the Company, for a new

warrant or warrants oflike tenor and representing the right to purchase the same

aggregate number ofShares. The Company shall maintain a registry showing the

name and address ofthe Warrantholder as the registered holder ofthis Warrant.

This Warrant may be surrendered for exchange or exercise in accordance with its

terms, at the office ofthe Company, and the Company shall be entitled to rely in

all respects, prior to written notice to the contrary, upon such registry.

10. Loss, Theft. Destruction or Mutilation ofWarrant. Upon receipt by

the Company of evidence reasonably satisfactory to it ofthe loss, theft,

destruction or mutilation ofthis Warrant, and in the case of any such loss, theft or

destruction, upon receipt ofa bond, indemnity or security reasonably satisfactory

to the Company, or, in the case of any such mutilation, upon surrender and

cancellation ofthis Warrant, the Company shall make and deliver, in lieu ofsuch

lost, stolen, destroyed or mutilated Warrant, a new Warrant oflike tenor and

representing the right to purchase the same aggregate number ofShares as

provided for in such lost, stolen, destroyed or mutilated Warrant.

11. Saturdays. Sundays. Holidays, etc. Ifthe last or appointed day for

the taking of any action or the expiration of any right required or granted herein

shall not be a business day, then such action may be taken or such right may be

exercised on the next succeeding day that is a business day. .

12. Rule 144 Information. The Company covenants that it will use its

reasonable best efforts to timely file all reports and other documents required to

be filed by it under the Securities Act and the Exchange Act and the rules and

regulations promulgated by the SEC thereunder (or, ifthe Company is not

required to file such reports, it will, upon the request ofany Warrantholder, make

publicly available such information as necessary to permit sales pursuant to Rule

144 under the Securities Act), and it will use reasonable best efforts to take such

further action as any Warrantholdermay reasonably request, in each case to the

extent required from time to time to enable such holder to, ifpermitted by the

terms ofthis Warrant and the Purchase Agreement, sell this Warrant.without

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(NY) 078651OO2fl"ARPIAIG.wanant.doc 11109108 10:50 PM
registration under the Securities Act within the limitation ofthe exemptions

provided by (A) Rule 144 under the Securities Act, as such rule maybe amended

from time to time, or (B) any successor rule or regulation hereafter adopted by the

SEC. Upon the written request of any Warrantholder, the Company will deliver to

such Warrantholder a written statement that it has complied with such

requirements.

13. Adjustments and Other Rights. The Exercise Price and the number

of Shares issuable upon exercise ofthis Warrant shall be subject to adjustment

from time to time as follows; provided, that ifmore than one subsection ofthis

Section 13 is applicable to a single event, the subsection shall be applied that

produces the largest adjustment and no single event shall cause an adjustment

under more than one subsection ofthis Section 13 so as to result in duplication:

(A) Charter Amendment. Upon the effectiveness ofthe Charter

Amendment, the Exercise Price shall be adjusted from its initial value of $2.50 to

the amended par value per share ofCommon Stock.

(B) Stock Splits. Subdivisions. Reclassifications or Combinations. If

the Company shall (i) declare and pay a dividend or make a distribution on its

Common Stock in shares of Common Stock, (ii) subdivide or reclassify the

outstanding shares ofCommon Stock into a greater number ofshares, or (iii)

combine or reclassify the outstanding shares ofCommon Stock into a smaller

number ofshares, the number ofShares issuable upon exercise ofthis Warrant at

the time ofthe record date for such dividend or distribution or the effective date

ofsuch subdivision, combination or reclassification shall be proportionately

adjusted so that the Warrantholder after such date shall be entitled to purchase the

number ofshares ofCommon Stock which such holder would have owned or

been entitled to receive in respect ofthe shares ofCommon Stock subject to this

Warrant after such date had this Warrant been exercised immediately prior to such

date. In such event, the Exercise Price in effect at the time ofthe record date for

such dividend or distribution or the effective date ofsuch subdivision,

combination or reclassification shall be adjusted to the number obtained by

dividing (x) the product of(l) the number ofShares issuable upon the exercise of

this Warrant before such adjustment and (2) the Exercise Price in effect

immediately prior to the record or effective date, as the case may be, for the

dividend, distribution, subdivision, combination or reclassification giving rise to

this adjustment by (y) the new number ofShares issuable upon exercise ofthe

Warrant detennined pursuant to the immediately preceding sentence.

(C) Certain Issuances ofCommon Shares or Convertible Securities.

Until the earlier of(i) the date on which the Original Warrantholder no longer

holds this Warrant or any portion thereof and (ii) the third anniversary ofthe Issue

Date, ifthe Company shall issue shares ofCommon Stock (or rights or warrants

or other securities exercisable or convertible into or exchangeable (collectively, a

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(NY) 07865/002ITARP/AIG.warraot.doc 11109/08 10:50 PM
"conversion') for shares ofCommon Stock) (collectively, "convertible securities')

(other than in Pennitted Transactions (as defined below) or a transaction to which

subsection (B) ofthis Section 13 is applicable) without consideration or at a

consideration per share (or having a conversion price per share) that is less than

90% ofthe Market Price on the last trading day preceding the date ofthe

agreement on pricing such shares (or such convertible securities) then, in such

event:

(A) the nutnber ofShares issuable upon the exercise ofthis Warrant .

immediately prior to the date ofthe agreement on pricing ofsuch shares

(or ofsuch convertible securities) (the "InitialNumber) shall be increased

to the number obtained by multiplying the Initial Number by a fraction (A)

the numerator ofwhich shall be the sum of(x) the number ofshares of

Common Stock ofthe Company outstanding on such date and (y) the

number of additional shares ofCommon Stock issued (or into which

convertible securities may be exercised or convert) and (B) the

denominator ofwhich shall be the sum of(I) the number ofshares of

Common Stock outstanding on such date and (II) the number ofshares of

Common Stock which the aggregate consideration receivable by the

Company for the total number ofshares ofCommon Stock so issued (or

into which convertible securities may be exercised or convert) would

purchase at the Market Price on the last trading day preceding the date of

the agreement on pricing such shares (or such convertible securities); and

(B) the Exercise Price payable upon exercise ofthe Warrant shall be

adjusted by multiplying such Exercise Price in effect immediately prior to

the date ofthe agreement on pricing ofsuch shares (or ofsuch convertible

securities) by a fraction, the numerator ofwhich shall be the number of

shares ofCommon Stock issuable upon exercise ofthis Warrant prior to

such date and the denominator ofwhich shall be the number ofshares of

Common Stock issuable upon exercise ofthis Warrant immediately after

the adjustment described in clause (A) above.

For purposes ofthe foregoing, the aggregate consideration receivable by

the Company in connection with the issuance ofsuch shares ofCommon Stock or

convertible securities shall be deemed to be equal to the sum ofthe net offering

price (including the Fair Market Value of any non-cash consideration and after

deduction ofany related expenses payable to third parties) of all such securities

plus the minimum aggregate amount, if any, payable upon exercise or conversion

of any such convertible securities into shares ofCommon Stock; and "Permitted

Transactions" shall mean issuances (i) as consideration for or to fund the

acquisition ofbusinesses andlor related assets, (ii) in connection with employee

benefit plans and compensation related arrangements in the ordinary course and

consistent with past practice approved by the Board ofDirectors, (iii) in

connection with a public or broadly marketed offering and sale ofCommon Stock

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(NY) 0786S/OO2ffARP/AIG.wamnldoc 1110910110:50 PM
or convertible securities for cash conducted by the Company or its affiliates

pursuant to registration under the Securities Act or Rule 144A thereunder on a

basis consistent with capital raising transactions by comparable financial

institutions and (iv) in connection with the exercise ofpreemptive rights on terms

existing as ofthe Issue Date. Any adjustment made pursuant to this Section 13(C)

shall become effective immediately upon the date ofsuch issuance.

(D) Other Distributions. In case the Company shall fix a record date for

the making of a distribution to all holders ofshares ofits Common Stock of

securities, evidences ofindebtedness, assets, cash, rights or warrants (excluding

dividends ofits Common Stock and other dividends or distributions referred to in

Section 13(B)), in each such case, the Exercise Price in effect prior to such record

date shall be reduced immediately thereafter to the price determined by

multiplying the Exercise Price in effect immediately prior to the reduction by the

quotient of(x) the Market Price ofthe Common Stock on the last trading day

preceding the first date on which the Common Stock trades regular wayan the

principal national securities exchange on which the Common Stock is listed or

admitted to trading without the right to receive such distribution, minus the

amount of cash and/or the Fair Market Value ofthe securities, evidences of

indebtedness, assets, rights or warrants to be so distributed in respect of one share

ofCommon Stock (such amount and/or Fair Market Value, the "Per Share Fair

Market Value") divided by (y) such Market Price on such date specified in clause

(x); such adjustment shall be made successively whenever such a record date is

fixed. In such event, the number ofShares issuable upon the exercise ofthis

Warrant shall be increased to the number obtained by dividing (x) the product of

(1) the number ofShares issuable upon the exercise ofthis Warrant before such

adjustment, and (2) the Exercise Price in effect immediately prior to the

distribution giving rise to this adjustment by (y) the new Exercise Price

determined in accordance with the immediately preceding sentence. In the event

that such distribution is not so made, the Exercise Price and the number ofShares

issuable upon exercise ofthis Warrant then in effect shall be readjusted, effective

as ofthe date when the Board ofDirectors determines not to distribute such shares,

evidences ofindebtedness, assets, rights, cash or warrants, as the case may be, to

the Exercise Price that would then be in effect and the number ofShares that

would then be issuable upon exercise ofthis Warrant ifsuch record date had not

been fixed.

(E) Certain Repurchases ofCommon Stock. In case the Company

effects a Pro Rata Repurchase ofCommon Stock, then the Exercise Price shall be

reduced to the price determined by multiplying the Exercise Price in effect

immediately prior to the Effective Date ofsuch Pro Rata Repurchase by a fraction

ofwhich the numerator shall be (i) the product of(x) the number ofshares of

Common Stock outstanding immediately before such Pro Rata Repurchase and (y)

the Market Price of a share ofCommon Stock on the trading day immediately

preceding the first public announcement by the Company or any ofits Affiliates

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(NY) 0186SI002ITARPIAIG.warrant.doc 1110910810:50 PM
ofthe intent to effect such Pro Rata Repurchase, minus (ii) the aggregate purchase

price ofthe Pro Rata Repurchase, and ofwhich the denominatorshall be the

product of(i) the number ofshares ofCommon Stock outstanding immediately

prior to such Pro Rata Repurchase minus the number ofshares ofCommon Stock

so repurchased and (ii) the Market Price per share ofCommon Stock on the

trading day immediately preceding the first public announcement by the Company

or any ofits Affiliates oithe intent to effect such Pro Rata Repurchase. In such

event, the nUIIiber ofshares ofCommon Stock issuable upon the exercise ofthis

Warrant shall be increased to the number obtained by dividing (x) the product of

(1) the number ofShares issuable upon the exercise ofthis Warrant before such

adjustment, and (2) the Exercise Price in effect immediately prior to the Pro Rata

Repurchase giving rise to this adjustment by (y) the new Exercise Price

determined in accordance with the immediately preceding sentence. For the

avoidance ofdoubt, no increase to the Exercise Price or decrease in the number of

Shares issuable upon exercise ofthis Warrant shall be made pursuant to this

Section 13(E).

(F) Business Combinations. In case of any Business Combination or

reclassification ofCommon Stock (other than a reclassification ofCommon Stock

referred to in Section 13(B», the Warrantholder's right to receive Shares upon

exercise ofthis Warrant shall be converted into the right to exercise this Warrant

to acquire the number ofshares ofstock or other securities or property (inclUding

cash) which the Common Stock issuable (at the time ofsuch Business

Combination or reclassification) upon exercise ofthis Warrant immediately prior'

to such Business Combination or reclassification would have been entitled to

receive upon consummation ofsuch Business Combination or reclassification;

and in any such case, ifnecessary, the provisions set forth herein with respect to

the rights and interests thereafter ofthe Warrantholder shall be appropriately

adjusted so as to be applicable, as nearly as may reasonably be, to the

Warrantholder's right to exercise this Warrant in exchange for any shares ofstock

or other securities or property pursuant to this paragraph. In determining the kind

and amount ofstock, securities or the property receivable upon exercise ofthis

Warrant following the consummation ofsuch Business Combination, ifthe

holders ofCommon Stock have the right to elect the kind or amount of

consideration receivable upon consummation ofsuch Business Combination, then

the consideration that the Warrantholder shall be entitled to receive upon exercise

shall be deemed to be the types and amounts ofconsideration received by the

majority of all holders ofthe shares ofCommon Stock that affirmatively make an

election (or of all such holders ifnone make an election).

(G) Rounding ofCalculations: Minimum Adjustments. All calculations

under this Section 13 shall be made to the nearest one-tenth (1/1Oth) of a cent or

to the nearest one-hundredth (1/1OOth) of a share, as the case may be. Any

provision ofthis Section 13 to the contrary notwithstanding, no adjustment in the

Exercise Price or the number ofShares into which this Warrant is exercisable

12 .(NY) 078651OO21TARP/AlG.wammtdoc: 11109/08 10:50 PM
shall be made ifthe amount ofsuch adjustment would be less than SO.01 or onetenth (l/10th) ofa share ofCommon Stock, but any such amount shall be carried.

forward and an adjustment with respect thereto shall be made at the time of and

together with any subsequent adjustment which, together with such amount and

any other amount or amounts so carried forward, shall aggregate SO.Ol or 1/1Oth

ofa share ofCommon Stock, or more.

(II) Timing ofIssuance ofAdditional Common Stock Upon Certain

Adjustments. In any case in which the provisions ofthis Section 13 shall require

that an adjustment shall become effective immediately after a record date for an

event, the Company may defer until the occurrence ofsuch event (i) issuing to the

Warrantholder ofthis Warrant exercised after such record date and before the

occurrence ofsuch event the additional shares ofCommon Stock issuable upon

such exercise by reason ofthe adjustment required by such event over and above

the shares ofCommon Stock issuable upon such exercise before giving effect to

such adjustment and (ii) paying to such Warrantholder any amount ofcash in lieu

of a fractional share ofCommon Stock; provided, however, that the Company

upon request shall deliver to such Warrantholder a due bill or other appropriate

instrument evidencing such Warrantholder's right to receive such additional

shares, and such cash, upon the occurrence ofthe event requiring such adjustment

(I) Other Events. For so long as the Original Warrantholder holds this

Warrant or any portion thereof, if any event occurs as to which the provisions of

this Section 13 are not strictly applicable or, ifstrictly applicable, would not, in

the good faith judgment ofthe Board ofDirectors ofthe Company, fairly and

adequately protect the purchase rights ofthe Warrants in accordance with the

essential intent and principles ofsuch provisions, then the Board ofDirectors

shall make such adjustments in the application ofsuch provisions, in accordance

with such essential intent and principles, as shall be reasonably necessary, in the

good faith opinion ofthe Board ofDirectors, to protect such purchase rights as

aforesaid. The Exercise Price and the number of Shares into which this Warrant is

exercisable shall not be adjusted in the event of a change in the par value ofthe

Common Stock (other than pursuant to the Charter Amendment) or a change in

the jurisdiction ofincorporation ofthe Company.

(J) Statement Regarding Adjustments. Whenever the Exercise Price or

the number ofSbares into which this Warrant is exercisable shall be adjusted as

provided in Section 13, the Company shall forthwith file at the principal office of

the Company a statement showing in reasonable detail the facts requiring such

adjustment and the Exercise Price that shall be in effect and the number ofShares

into which this Warrant shall be exercisable after such adjustment, and the

Company shall also cause a copy ofsuch statement to be sent by mail, first class

postage prepaid, to each Warrantholder at the address appearing in the Company's

records.

13

(NY) 0786SIOO2ITARP/AIG.wanaot.doc 11109/08 10:50 PM
(K) Notice ofAdjustment Event. In the event that the Company shall

propose to take any action ofthe type described in this Section 13 (but only ifthe

action ofthe type described in this Section 13 would result in an adjustment in the

Exercise Price or the number ofShares into which this Warrant is exercisable or a

change in the type ofsecurities or property to be delivered upon exercise ofthis

Warrant), the Company shall give notice to the Warrantholder, in the manner set

forth in Section 13(1), which notice shall specify the record date, if any, with

respect to any such action and the approximate date on which such action is to

take place. Such notice shall also set forth the facts with respect thereto as shall be

reasonably necessary to indicate the effect on the Exercise Price and the number,

kind or class ofshares or other securities or property which shall be deliverable

upon exercise ofthis Warrant. In the cas.e of any action which would require the

fIxing of a record date, such notice shall be given at least 10 days prior to the date

so fixed, and in case ofall other action, such notice shall be given at least 15 days

prior to the taking ofsuch proposed action. Failure to give such notice, or any

defect therein, shall not affect the legality or validity ofany such action.

(L) Proceedings Prior to Any Action Requiring Adjustment. As a

condition precedent to the taking ofany action which would require an adjustment

pursuant to this Section 13, the Company shall take any action which may be

necessary, including obtaining regulatory, New York Stock Exchange or.

stockholder approvals or exemptions, in order that the Company may thereafter

validly and legally issue as fully paid and nonassessable all shares ofCommon

Stock that the Warrantholder is entitled to receive upon exercise ofthis Warrant

pursuant to this Section 13.

(M) Adjustment Rules. Any adjustments pursuant to this Section 13

shall be made successively whenever an event referred to herein shall occur. If an

adjustment in Exercise Price made hereunder would reduce the Exercise Price to

an amount below par value ofthe Common Stock, then such adjustment in

Exercise Price made hereunder shall reduce the Exercise Price to the par value of

the Common Stock.

14. Exchange. At any time following the date on which the shares of

Common Stock ofthe Company are no longer listed or admitted to trading on a

national securities exchange (other than in connection with any Business

Combination), the Original Warrantholder may cause the Company to exchange

all or a portion ofthis Warrant for an economic interest (to be determined by the

Original Warrantholder after consultation with the Company) ofthe Company

classified as permanent equity under U.S. GAAP having a value equal to the Fair

Market Value ofthe portion ofthe Warrant so exchanged. The Original

Warrantholder shall calculate any Fair Market Value required to be calculated

pursuant to this Section 14, which ~hall not be subject to the Appraisal Procedure.

14

(NY) 0786SIOO2ITARP/AIG.wanaDLdoc 11/09108 10:SO PM
15. No Impairment. The Company will not, by amendment ofits

Charter or through any reorganization, transfer of assets, consolidation, merger,

dissolution, issue or sale ofsecurities or anyother voluntary action, avoid or seek

to avoid the observance or performance ofany ofthe terms to be observed or

perfonned hereunder by the Company, but will at all times in good faith assist in

the carrying out of all the provisions ofthis Warrant and in taking of all such

action as may be necessary or appropriate in orderto protect the rigpts ofthe

Warrantholder.

16. Governing Law. This Warrant, and the rights and obligations

of the parties hereunder, shall be governed by, and construed and

interpreted in accordance with, United States federal law and not the law of

any State. To the extent that a court looks to the laws of any State to

determine or derme the United States federal law, it is the intention ofthe

parties hereto that such court shall look only to the laws ofthe State of New

York without regard to the rules of conflicts oflaws. Each ofthe Company

and the Warrantholder agrees (a) to submit to the exclusive jurisdiction and

venue ofthe United States District Court for the District of Columbia for any

action, suit or proceeding arising out of or relating to this Warrant or the

transactions contemplated hereby, and (b) that notice may be served upon

the Company at the address in Section 20 below and upon the

Warrantholder at the address for the Warrantholder set forth in the registry

maintained by the Company pursuant to Section 9 hereof. To the extent

permitted by applicable law, each ofthe Company and the Warrantholder

hereby unconditionally waives trial by jury in any legal action or proceeding

relating to the Warrant or the transactions contemplated hereby or thereby.

17. Binding Effect. 1bis Warrant shall be binding upon any successors

or assigns ofthe Company.

18. Amendments. This Warrantmay be amended and the observance

of any term ofthis Warrant may be waived only with the written consent ofthe

Company and the Warrantholder.

19. Prohibited Actions. The Company agrees that it will not take any

action which would entitle the Warrantholder to an adjustment ofthe Exercise

Price ifthe total number ofshares ofCommon Stock issuable after such action

upon exercise ofthis Warrant, together with all shares ofCommon Stock then

outstanding and all shares ofCommon Stock then issuable upon the exercise ofall

outstanding options, warrants, conversion and other rights, would exceed the total

number ofshares ofCommon Stock then authorized by its Charter.

20. Notices. Any notice, request, instruction or other document to be

given hereunder by any party to the other will be in writing and will be deemed to

have been duly given (a) on the date of delivery if delivered personally, or by

15

(NY) 0786S/002lTARP/AIG.watTall!.doc 11109/08 10:50 PM
facsimile, upon confirmation ofreceipt, or (b) on the second business day

following the date ofdispatch if delivered by a recognized next day courier

service. All notices hereunder shall be delivered as set forth below, or pursuant to

such other instructions as may be designated in writing by the party to receive

such notice.

Ifto the Company:

American International Group, Inc.

70 Pine Street

New York, New York 10270

Attention: ChiefFinancial Officer:

Secretary:

Treasurer:

with a copy to:

Sullivan & Cromwell LLP

125 Broad Street

New York, NY 10004

Attention Robert W. Reeder, ill

Michael M. Wiseman

Ifto the Warrantholder:

United States Department ofthe Treasury

1500 Pennsylvania Avenue, NW, Room 2312

Washington, D.C. 20220

Attention: Assistant General Counsel (Banking and Finance)

Facsimile: (202) 622-1974

with a copy to:

Davis Polk & Wardwell

450 Lexington Avenue

New York, NY 10017

Attention: J000 Brandow

21. Entire Agreement. This Warrant contains the entire agreement

between the parties with respect to the subject matter hereof and supersede all

prior and contemporaneous arrangements or undertakings with respect thereto.

[Remainder ofpage intentionally left blank]

16

(NY) 0786SIOO2!TARPIAIG.wamm.doc 1\109108 10:50 PM
[Form of Notice ofExercise]

Date:-------

TO: American International Group, Inc.

RE: Election to Purchase Common Stock

The undersigned, pursuant to the provisions set forth in the attached

Warrant, hereby agrees to subscribe for and purchase the number ofshares ofthe

Common Stock set forth below covered by such Warrant. The·undersigned, in

accordance with Section 3 ofthe Warrant, hereby agrees to pay the aggregate

Exercise Price for such shares of Common Stock in the manner set forth below. A

new warrant evidencing the remaining shares ofCommon Stock covered by such

Warrant, but not yet subscribed for and purchased, if any, should be issued in the

name set forth below.

Number ofShares ofCommon Stock --------

Method ofPayment ofExercise Price (note if cashless exercise pursuant to

Section 3(i) ofthe Warrant or cash exercise pursuant to Section 3(ii) ofthe

Warrant, with consent ofthe Company and the Warrantholder) _

Aggregate Exercise Price: _

Holder:

By:

Name:

Title:

(NY) 0786S/OO2!TARP/AIG.wamutdoc 11109108 10:50 PM
IN WITNESS WHEREOF, the Company has caused this Warrant to be

duly executed by a dilly authorized officer.

Dated: November 25,2008

AMERICAN INTERNATIONAL

GROUP,INC.

By: 2>::::, £ Jhcr

Title:

Attest:

By: ~IUl£tJ~ Name:

Title:

[Signature Page to Warrant)

(NY) 0786S/OO2ITARP/AlG.wammt.doc 11109108 10:50 PM


AMERICAN INTERNATIONAL GROUP, INC.

Officer's Ce11ificate

November 25, 2008

This Officer's Certificate (this "Cert~ficate") is delivered in connection with

Section 1.2(d)(ii) of the Securities Purchase Agreement, dated as of November 25. 2008

(the "Agreement"), between American International Group, Inc. (the "Company") and the

United States Department of the Treasury (the "Investor").

Capitalized terms used but not defined herein have the meaning ascribed to them

in the Agreement.

The undersigned duly authorized Senior Executive Officer of the Company

hereby certifies to the Investor, on behalf of the Company, that:

(A) the representations and warranties of the Company set forth in (x) Section

2.2(g) of the Agreement are tme and correct in all respects as though made

on and as of the date hereof, (y) Sections 2.2(a) through (f) of the

Agreement are tme and correct in all material respects as though made on

and as of the date hereof (other than representations and warranties that by

their terms speak as of another date, which representations and warranties

were tme and correct in all material respects as of such other date) and (z)

Sections 2.2(h) through (v) of the Agreement (disregarding all

qualifications or limitations set forth in such representations and warranties

as to "materiality", "Company Material Adverse Effect" and words of

similar import) are tme and correct as though made on and as of the date

hereof (other than representations and warranties that by their terms speak

as of another date, which representations and warranties were tme and

correct as of such other date), except to the extent that the failure of such

representations and warranties referred to in this clause (z) to be so tme and

correct, individually or in the aggregate, does not have and would not

reasonably be expected to have a Company Material Adverse Effect; and

(8) the Company has performed in all material respects all obligations required

to be performed by it under the Agreement at or prior to the date hereof.

(Remainder ofpage intentionally left hlank)

NY 1253~: 1<)7657.4

IN WITNESS WHEREOF, the undersigned has executed this Certificate on the

date first written above.

AMERICAN INTERNATIONAL GROUP,

INC.

By:

Name:

~.~~

Title:

AIG UST Officer's Certificate 1

NY12534:197657.4



AMERICAN INTERNATIONAL GROUP, INC.

Officer's Certificate

November 25, 2008

This Officer's Certificate (this "Certificate") is delivered in connection with

Section 1.2(d)(iv) ofthe Securities Purchase Agreement, dated as ofNovember 25,2008

(the "Agreement"), between American International Group, Inc. (the "Company") and the

United States Department ofthe Treasury (the "Investor").

Capitalized ternlS used but not defined herein have the meaning ascribed to them

in the Agreement.

The undersigned duly authorized Senior Executive Officer ofthe Company

hereby certifies to the Investor, on behalf ofthe Company, that the Company:

(A) has taken all necessary action to effect such changes to its

compensation, bonus, incentive and other benefit plans, arrangements and

agreements (including golden parachute, severance and employment agreements)

(collectively, the "Benefit Plans") with respect to its Senior Executive Officers

(and to the extent necessary for such changes to be legally enforceable, each ofits

Senior Executive Officers has duly consented in writing to such changes), as may

be necessary, during the period that the Investor owns any debt or equity

securities ofthe Company acquired pursuant to the Agreement or the Warrant, in

order to comply with Section 111(b) ofthe Emergency Economic Stabilization

Act of2008, including the provisions for Systemically Significant Failing

Institutions, as implemented by guidance or regulation thereunder, including

Notice 2008-PSSFI, that has been issued and is in effect as ofthe date hereof,

including provisions prohibiting severance payments to its Senior Executive

Officers; and

(B) has taken all necessary action to effect such changes to its Benefit

Plans with respect to the U.S.-based Senior Partners (and to the extent necessary

for such changes to be legally enforceable, each ofthe U.S.-based Senior Partners

has duly consented in writing to such changes), as may be necessary, during the

period that the Investor owns any debt or equity securities ofthe Company

acquired pursuant to the Agreement or the Warrant, in order to comply with the

requirements in Section 4.10 ofthe Agreement.

(Remainder ofpage intel1tiol1af~v left blank)

IN WITNESS WHEREOF, the undersigned has executed this Certificate on the

date first written above.

AMERICAN INTERNATIONAL GROUP,

INC.

By: N~ kb(f'

Title:

AIG UST Officer's Certificate 2



SULLIVAN & CROMWELL LLP

TELEPHONE: 1-212-558-4000

FACSIMILE: 1-212-558-3588

WWW.SULLCROM.COM

United States Department ofthe Treasury,

1500 Pennsylvania Avenue, NW,

Washington, D.C. 20220.

Ladies and Gentlemen:

125f!JJ~~

JVew o/~J JVl!/10004-24.98

LOS ANGELES. PALO ALTO' WASHINt;TON. D.C.

FRANKFURT' LONDON' PARIS

BEIJING' HONG KONG' TOKYO

MELBOURNE' SYDNEY

November 25, 2008

In connection with the purchase today by you pursuant to the Securities

Purchase Agreement, dated as ofNovember 25,2008 (the "Purchase Agreement"),

between American International Group, Inc., a Delaware corporation (the "Company"),

and you, of 4,000,000 shares (the "Preferred Shares") ofthe Company's Series D Fixed

Rate Cumulative Perpetual Preferred Stock, par value $5.00 per share, and a warrant (the

"Warrant") to purchase initially up to 53,798,766 shares (the "Warrant Shares") ofthe

Company's common stock, par value $2.50 per share (the "Common Stock"), we, as

counsel for the Company, have examined such corporate records, certificates and other

documents, and such questions oflaw, as we have considered necessary or appropriate

for the purposes ofthis opinion. Upon the basis ofsuch examination, it is our opinion

that:

(1) The Company has been duly incorporated and is an existing

corporation in good standing under the laws ofthe State ofDelaware.

(2) The Preferred Shares have been duly authorized and, when issued

and delivered against payment in accordance with the Purchase Agreement, will

be validly issued and fully paid and nonassessable.

(3) The Preferred Shares will not be issued in violation of any

preemptive rights provided for in the Company's Restated Certificate of

Incorporation, as amended to the date ofthis opinion (the "Restated Certificate of

Incorporation"), or under the General Corporation Law ofthe State ofDelaware.

NY12534:197642.3

United States Department ofthe Treasury -2-

(4) The Warrant has been duly authorized and, when executed and

delivered by the Company, will constitute a valid and legally binding obligation

ofthe Company enforceable against the Company in accordance with its terms,

subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium

and similar laws of general applicability relating to or affecting creditors' rights

and to general equity principles.

(5) The Warrant Shares have been duly authorized and reserved for

issuance upon exercise ofthe Warrant and, when and to the extent issued upon

exercise ofthe Warrant in accordance with the terms and provisions ofthe

Warrant, will be validly issued, fully paid and nonassessable.

(6) The Company has corporate power and authority to execute and

deliver the Purchase Agreement and the Warrant and to perform its obligations

thereunder (including the issuance ofthe Preferred Shares, the Warrant and the

Warrant Shares).

(7) The execution, delivery and performance by the Company ofthe

Purchase Agreement and the Warrant and the consummation ofthe transactions

contemplated thereby have been duly authorized by all necessary corporate action

on the part ofthe Company, and no further corporate action is required on the part

ofthe Company other than the vote ofstockholders to amend the Company's

Restated Certificate ofIncorporation to allow the Preferred Shares to rank senior

to the Company's Series C Perpetual, Convertible, Participating Preferred Stock,

par value $5.00 per share, to be issued to a trust for the benefit ofthe United

States Treasury in connection with the Credit Agreement, dated as ofSeptember

22,2008, between the Company and the Federal Reserve Bank ofNew York, and

any other series ofserial preferred stock issued by the Company.

(8) The Purchase Agreement, assuming due authorization, execution

and delivery by you, constitutes a valid and legally binding agreement ofthe

Company enforceable in accordance with its terms, subject to bankruptcy,

insolvency, fraudulent transfer, reorganization, moratorium and similar laws of

general applicability relating to or affecting creditors' rights and general equity

principles; provided, however, that we express no opinion with respect to Section

3.1 (b) or Section 4.5(g) ofthe Purchase Agreement or the severability provisions

ofthe Purchase Agreement insofar as Section 3.1 (b) or Section 4.5(g) is

concerned.

The foregoing opinion is limited to the laws ofthe State ofNew York and

the General Corporation Law ofthe State of Delaware, and we are expressing no opinion

as to the effect ofthe laws of any other jurisdiction.

NY12534:197642.3

United States Department ofthe Treasury -3-

We have relied as to certain matters upon information obtained from

public officials, officers ofthe Company and other sources believed by us to be

responsible, and we have assumed that the certificates for the Preferred Shares conform

to the specimen thereof examined by us and have been duly countersigned by a transfer

agent and duly registered by a registrar ofthe Preferred Shares, that the certificates (if

any) for the Warrant Shares will conform to the specimen thereof examined by us and

will be duly countersigned by a transfer agent and duly registered by a registrar ofthe

Common Stock (and ifthe Warrant Shares are issued in uncertificated form, that they

will be duly recorded by a transfer agent and duly registered by a registrar thereof) and

that the signatures on all documents examined by us are genuine, assumptions which we

have not independently verified.

This opinion is delivered by us to you as counsel to the Company, is solely

for your benefit and may not be delivered or disclosed to any other person without our

prior written consent.

Very truly yours,

~I-~u!-

NY12534:197642.3



AMERICAN INTERNATIONAL GROUP, INC.

SECRETARY'S CERTIFICATE

I, Kathleen E. Shannon, Senior Vice President and Secretary of American

International Group, Inc., a Delaware corporation (the "Company"), hereby certify that:

1. No amendment or other document relating to or affecting the

Restated Certificate of Incorporation of the Company, dated as ofJune 2, 1995, has

been filed in the office of the Secretary of State of the State of Delaware since the

filing of a certificate of amendment on June 5, 2000 (other than the filing on

November 24, 2008, of a Certificate of Designations of the Company (the "Series D

Certificate of Designations") relating to the authorization, creation and issuance of the

Series D Fixed Rate Cumulative Perpetual Preferred Stock of the Company (the

"Series D Preferred Stock")), and no action has been taken by the Company or its

stockholders, directors or officers in contemplation of the filing of any such

amendment or other document (except (i) that the Board of Directors of the Company

(the "Board of Directors") intends to authorize, and a special meeting of the

stockholders of the Company will be called to vote upon, a decrease in the par value

of the Company's common stock, par value $2.50 per share (the "Cornmon Stock"),

an increase in the Company's capitalization, a change in the ranking of the Series D

Preferred Stock and a change in the authority of the Board of Directors to pledge

substantially all of th€Company's assets, (ii) for the planned issuance of the Series C

Perpetual, Convertible, Participating Preferred Stock and (iii) for a restatement of the

Restated Certificate of Incorporation of the Company), or in contemplation of the

liquidation or dissolution of the Company;

2. Attached hereto as Annex A-I and Annex A-2, respectively, are

true, correct and complete copies of (i) the Restated Certificate of Incorporation of the

Company as in full force and effect on the date hereof and (ii) the Amended and

Restated By-laws of the Company adopted by the Board of Directors on June 15,

2008, effective as ofJune 15, 2008, to and including the date hereof;

3. Attached hereto as Annex B are true, correct and complete copies

of resolutions duly adopted by the Board of Directors on November 9, 2008 and on

November 19, 2008 (collectively, the "Board Resolutions"), each of which was

adopted at a meeting duly held at which a quorum was present and acting throughout,

relating to the issuance and sale of the Series D Preferred Stock and a warrant (the

"Warrant") to purchase 53,798,766 shares of Common Stock. The Board Resolutions

have not been amended, modified or rescinded and remain in full force and effect in

the forms attached and have been filed with the minutes of the proceedings of the

Board of Directors;

4. The Board Resolutions are the only resolutions adopted by the

Board of Directors, any committee of the Board of Directors or by an Authorized

AIG UST Secretary's Certificate

NY12534:197664.8
Officer (as defined in the Board Resolutions) acting pursuant to resolutions of the

Board of Directors or any committee thereof relating to the authorization, creation,

issuance and sale by the Company of the Series D Preferred Stock and the Warrant;

5. Each of the Securities Purchase Agreement, dated as of November

25,2008 (the "Purchase Agreement"), between the Company and the United States

Department of the Treasury, and the Warrant, each as executed and delivered on

behalf of the Company, is in the form or substantially the form approved by or

pursuant to the Board Resolutions and has been executed by an Authorized Person;

6. Attached hereto as Annex C is a true, correct and complete

specimen of the certificate representing the Series D Preferred Stock; and

7. Each person who, as a director or officer of the Company, signed

(i) the Warrant, (ii) the Series D Certificate of Designations, (iii) the Purchase

Agreement, (iv) the certificate or certificates representing the Series D Preferred

Stock, or (v) any other document delivered prior hereto or on the date hereof in

connection with the transactions described in the Purchase Agreement was at the

respective times of such signing and delivery duly elected or appointed, qualified and

acting as such director or officer, and the signatures of such persons appearing on

such documents are their genuine signatures.

[Signature page follows]

AIG UST Secretary'S Certificate

NY 12534:197664.8
IN WITNESS WHEREOF, I have hereunto signed my name.

Dated: November 25,2008

AMERICAN INTERNATIONAL GROUP, INC.

By:JjaY11wl,

Name: KathleeIi'"E.

[~

Shannon

Title: Senior Vice President and Secretary

AIG UST Secretary's Certificate

NY12534: 197664.8

I, AJ,J2.i! d/..tf:u,/<:.e.-, an Assistant Secretary of American j

Assistant Secretary

International Group, Inc., a Delaware corporation, hereby certify that Kathleen E.

Shannon is the duly elected, qualified and acting Senior Vice President and Secretary of

American International Group, Inc. and that the signature appearing above is her genuine

signature.

IN WITNESS WHEREOF, I have hereunto signed my name.

Dated: November 25, 2008

BY~~ Name:

Title:

NY12534: 197664.8

AIG UST Secretary's Certificate

Annex A-I

f})e[aware

%.e :First State

PAGE 1

I, HARRIET SMITH WINDSOR, SECRETARY OF STATE OF THE STATE OF

DELAWARE, DO HEREBY CERTIFY THE ATTACHED ARE TRUE AND CORRECT

COPIES OF ALL DOCUMENTS FILED FROM AND INCLUDING THE RESTATED

CERTIFICATE OR A MERGER WITH A RESTATED CERTIFICATE ATTACHED OF

"AMERICAN INTERNATIONAL GROUP, INC." AS RECEIVED AND FILED IN

THIS OFFICE.

THE FOLLOWING DOCUMENTS HAVE BEEN CERTIFIED:

RESTATED CERTIFICATE, FILED THE SECOND DAY OF JUNE, A.D.

1995, AT 9 O'CLOCK A.M.

CERTIFICATE OF AMENDMENT, FILED THE THIRD DAY OF JUNE, A.D.

1998, AT 9 O'CLOCK A.M.

CERTIFICATE OF MERGER, FILED THE THIRTIETH DAY OF DECEMBER,

A.D. 1998, AT 12 O'CLOCK P.M.

AND I DO HEREBY FURTHER CERTIFY THAT THE EFFECTIVE DATE OF

THE AFORESAID CERTIFICATE OF MERGER IS THE FIRST DAY OF JANUARY,

A.D. 1999.

CERTIFICATE OF AMENDMENT, FILED THE FIFTH DAY OF JUNE, A.D.

2000, AT 9 O'CLOCK A.M.

0658607 8100X

080871066

You may verify this certificate online at corp. delaware. gov/authver. shtml

Harriet Smith Windsor, Secretary of State

AUTHENTICATION: 6791115

DATE: 08-13-08
STATE OF DELAWARE

SECRETARY OF STATE

OIVIsION OF CORPORATIONS

FILED 09,00 AM 06/02/1995

950122731 - 658607

U8'1'A'.rBD CRR'l'IFlCA'1'B OF UlCOJlPOIlA'1'XOllJ

of

1-XEJUCAII Ul'l'E1UIM'IOlQL GROUP, 1'1IJC.

American International Group, Inc. (the ·company"), a

corporation which is organized and existing under and by vi~tue of

the General Corporation Law of the state of DQlawarg and which was

originally incorporated under such law as "American International

Enterprises, Inc." on June 9, 1967, DOES HER~BY CERTIFY:

FIRST: That at a meeting of the Board ot Directors of the

company rQRolutions were duly adopted settinq forth a proposed Restated Certificate of Incorporation of £aid company, declarinq

the restatement and illIIendJllent of the Restated Certificate of

Incorporation of said company to De advisable and directing that

the amendment proposed be considered at the next annual meeting of

the stocJcholders of said Company. The resolution setting forth the

restatement is as follows:

RES 0 L V E 0

That the certificate of Incorporation of AMERICAN

INTERNAT:IONAL GRoup, INC. (the "Company") is restated and amended

so that as restated and amended it will read in it. entirety as

follows:

"ARTICLE ONE.

Name.

The name of the Company is AM£R:ICAN INTERNATIONAL GROUP, INC.

ARTICLE TWO.

Reqistered Office and Registered Agent.

Its principal office is to be located in the City of Dover, in

the county ot Rent, in the state of Delaware. The name of ita

resident aqent is the UNITED ST~TES CORPORATION COMPANY, whose addr~a is 32 Loockerman square, suite L-l00 in said city.
ARTICLE THREE.

corporate Purposes and Powers.

The nature of the business or purposes to be conducted or

promoted by the Company is to engage in any lawful act or activity

for which corporations may be organized under the General

corporation Law of Delaware, including, but not limited to, the

business of insurancQ agent, broker or adjuster.

ARTICLE FOUR.

capital stock.

The total number of shares of all classes of stock which the

Company shall have authority to issue is 1,006,000,000, of which

6,000,000 shares are to be Serial Preferred Stock, par value $5.00

per share (hereinafter called ~e "Serial Preferred stock") and

1,000,000,000 shares a~e to be Common stock, par value $2.50 per share (hereinafter called the "Co1lUllon stock h ).

The voting powers, designations, preferences and relative,

participating, optional and oth~ special rights, and the

qualifications, limitations and restrictions thereof, of the Serial

Preferred stock and the COllUDon Stock, in addition to those set

forth elsewhere he~ein, are as follows:

(1) The Serial Preferred Stock may be issued from time to

time by the Board of Directors, as shares of one or more series of

Serial Preferred stock, and, SUbject to subdivisions (2) through

(6) of this Article Four, the Board of Directors or a duly

authorized c01DJllittee thereof is expressly authorized, prior to

issuance, in the resolution or resolutions p~oviding for the issue

of shares of each pa~ticular series, to fix the relative rights,

preferehces or limitations of the shares of the series, includin~

but not li.ited to the following:

(a) The distinctive serial designation of such series

which shall distinguish it from other series;

(b) The number of shares included in such series, which n~r may be increased or decreased from time to time unless

otherwise provided in the resolutions creating the series;

(c) The dividend rate or rates (or method of determining

such rate or rates) for shares of such series and the date or

dates (or the method of determining such date or dates) Upon

which such dividends shall be payable;

2
Cd) Whether dividends on the shares of such series shall

be cumulative, and, in the case of shares of any series havinq

cumulative dividend rights, the date or dates or method of

determihlng the date or dates from which dividends on the sh8~es ot such series shall be cumulative;

(e) The amount or amounts which shall be paid out of tbe

assets of the Company to the holders of the shares of such

series upon voluntary or involuntary liquidation, dissolutioh

or winding up of the Company;

(t) The price or prices at which, the period or periods

within which and the terms and conditions upon which the

shares of such series may be redeemed or exchanged, in whole

or in part;

(g) The obligation, if any, of the company to purchase

or redeem shares of such series pursuant to a sinkinq fund or

otherwise and the price or prices at which, tha pariod or

periods within which and the terms and conditions upon which

the shares of such series shall be redeemed, in whole or in

part, pursuant to such obligation;

(h) The period or periods within which and the terms and

conditions, if any, including the price or prices or the rate

or rates of conversion and the terDS and conditions of any

adjustlllents t.hereof, upon which the shares of such series

shall be convertible at the option of the holder into shares

of any other class of stock or into shares of any other series

of serial Preferred Stock, except into shares of a class

having rights or preferences as to dividends or distribution

of assets upon liquidation which are prior or superior in rank

to those of the shares being converted;

(1) The voting rights, if any, of the shares of such

series in addition to those required by law, includlnq tha

number of votes per share and any requirelDent for the approval

by the holders of up to 66 2/3' of all Serial Preferred stock,

or of the shares of one or more serie., or of both, as a condition to specified corporate action or amendments to the

Restated Certificate of Incorporation; and

preferences or

not inconsistent

rights,

series

(j) Any other relative

limit.ations of the shares of the

herewith or with applic~ble law.

(2) All Serial Preferred stock (8) shall rank senior to the

Common stock in respect of the right to receive dividends and the

right to receive payments out of the assets of the Company upon

voluntary or involunt.ary liquidation, dissolution or winding up of

the CObpany and (b) shall be of equal ra~ wit.h all other shares of

the Serial Preferred Stock as to the right to receiva dividends and

3
the ri9ht to receive payments out of the assets of the co~pany upon

voluntary or involuntary liquidation, dissolution or windinq up of

the Company. .

(3) No dividend shall be paid upon, or declared or set apart

for, any share of Serial Preferred stock or any other share of

prererred stock rank1nq on a parity with the Serial Preferred Stock

as to dividends unless at the same time a like proportionate

dividend, ratablY in proportion to the respective dividend rates

fixed therefor, shall be paid upon, or declared and set apart for,

all shares of Serial Preferred stock 8nd preferred stock of all

series ranking on a parity aa to dividends then issued and

outBtandinq and on which dividends are accrued and payable for all

dividend periods terminatinq on or prior to the dividend payment

date.

(4) In no event, so long as any shares of serial Preferred

stock shall be outstanding, shall any dividend, whether in cash or

property, be paid or declared, nor shall any distribution be made,

on any junior stock, nor shall any shares of any junior stock be

purchased, redeemed or otherwise acquired for value by the company,

unless all divid~nd6 on the Serial ~referred stock of all series

and any series of preferred stock ranking on a parity with the

Serial Preferred stock as to dividends for all past dividend

periods and for the then current period shall have heen paid or

declared and a sum SUfficient for the payment thereof set apart, and unless the Company shall not be in default with respect to any of its obligations with respect to any past period with resp~ct to

any sinking fund for any s~ries of Serial Preferred stock and

preferred stock ranking on a parity with the Serial Preferred stock

as to dividends. The foregoing provisions of this sub-division (4)

shall not, however, apply to a dividend payable on any junior

stocle, or to the acquisition of shares of any junior stock in

exchange for, or through application of the proceeds of the sale

Of, shares of any other junior stock.

(5) In the event of any voluntary or involuntary liquidation,

dissolution or winding up of the affairs of the company, then,

before any distribution or pa~ent shall be made to the holders of

any junior stock, the holders of the Serial Prererred Stock and any

shares of preferred stock ranking on a parity therewith as to

liquidation shall be entitled to be paid in full the respective

amounts of the liquidation preferences thereof, which in the case

of Serial Preferred Stock shall be the amounts fixed in accordance

with the provisions of subdivision (1) of this Article Four,

together with accrued di~idends to such distribution or payment

dat:e whether or not earned or declared. If such payment shall have

been nade in full to the holders of the Serial Preferred stock and

any series of preferred stock ranking on a parity therewith as to

liquidation, the r~ainin9 assets and funas of the Company shall be

distributed among the holders of the junior stock, according to

their respective rights and preferences and in each case accordinq

4
to their respective shares. If, upon any liquidation, dissolution

or windinq up of the affairs of the Company, the albounts so payable

are not paid in full to the holders of all outstanding shares of

Serial Preferred Stock and any series. of preferred stock ranking on

a parity therewith as to liquidation, the holders of all series of

Serial Preferred Stock and any series of preferred stock ranking on

a parity therewith as to liquidation shall share ratably in any

distribution of assets in proportion to the full amounts to which

they would otherwise be respectively entitled. Neither the

consolidation or merger of the company, nor the sale, lease or

conveyance of all or a part of its assets, shall be deeJlled a

liquidation, dissolution or winding up ot the affairs of the

Company within the meaning of the foregoing provisions of this

sUbdivision (5).

(6) No holder of Serial Preferred stock shall be entitled as

a matter of riqht to subscribe for or purchase, or have any

preemptive right with respect to, any part of any new or additional

issue of stock of any class Whatsoever, or of securities

convertible into any stock of any class Whatsoever, whether now or

hereafter authorized and whether issued for cash or other

consideration or by way of dividend.

(7) As used herein with respect to the Serial Preferred stock

or in any resolution adopted by the Board of Directors providing

for thG issue of any particular series of the Serial Preferred

stock as authorized by subdivision (1) of this Article Four, the

followinq terms shall have the following meanings:

(a) The term "junior stock" shall JIIean the COJlll1lon stock

and any other class of stock of the Company hereafter

authorized oVer which the Serial Preferred stock has

preference or priority in the payment of dividends or in the

distribution of assets on any liquidation, dissolution or

windinq up of the Company.

(b) The term "sinkin9 fund" shall lIIean any fund or

requirement for the periodic retirement of shares.

(c) The term "accrued dividends", with respect to any

share of any series, shall mean an amount computed at the

annual dividend rate for the series of which the particular

share is a part, fro~ the date on which dividends on such

share became cumUlative to and including the date to which

such dividends are to be accrued, less the aggregate amount of

all dividends theretofore paid thereon.

(8) No holder of any sha~e or shares of stock of the Company

shall be entitled as of right to Subscribe for, purchase or receive

any shares ~f stock of any class or any other securities which the

company may issue, whether now or hereafter authorized, and wbether

such stock or securities be issued for money or for a consideration

5
other than money or bf way of a dividend and all such shares of s~ock or other securit1es may be issued or disposed or by the Board

of Directors to such persons, firms, corporations, and associations

and on such ter1lLS as it, in its absolute discretion, may deem

advisable, without offering to stockholders then ot record or any

class of stockholders any thereof upon the same terms or upon any

terms.

(9) The holders of the shares ot Common Stock will be

entitled to one vote per share of such stock on all matters except

as herein or by statute otherwise provided.

ARTICLE FIVE.

Minimum Capital.

The m1nlmum amount of capital !lii~h 'Which the Company !liill

COMmence business is $1,000.

ARTICLE SIX.

Corporate Existence.

The Co~any is to have perpetual existence.

ARTICLE SEVEN.

Liability of Holders of Capital stock

for Corporate Debts.

The private property of the stockholders shall not be subject

to the payment of corporate debts to any extent whatever.

ARTICLE EIGHT.

Powers of Board of Directors: MeetingsJ

Corporate Books; Etc.

The following provisions are inse~ed for the management of

the business and for the conduct of the affairs of the Company, and

for further definition, limitation and regulation of the powers of

the Company and of its directors and stockholders:

(1) SUbject to the provisions of SUbdivision (6) of Article

Four hereof, the number of directors of the Company shall be such

as from time to ti~e shall be fixed by, or in the manner provided

in the By-Laws. Election of directors need not be by ballot unless

the By-Laws 80 provide.

6
(2) The Board of Directors shall have pover:

(a) Without the assent or vote of the stockholders, to

make, elter, amend, change, add to, or repeal the By-Lavs of

the Company; to fix and vary the aJllo\U1t to be recerved for any

proper purpose and to abolish any such reserve in the manner

in which it vas created1 to authorize and cause to be executed

mortgages and liens upon any part of the property of the

COlllpany provided it be le6s than substantially all; to

determine the use and disposition of any curplus or net

profits and to fix the times to~ the declaration and paYlllent of dividends.

(b) To determine from time to time vhether, and to what

extent, and at what times and places, and under what

conditions and regulations, the accounts and books of the

Company (other than the stock ledger) or any of thelll, chall be

open to the inspection of the stockholders.

(c) By resolution passed by a majority of' the whole

board, to designate one or more committees, each co~ittee to

consist of two or more ot the directors of the company, wbich,

to the extent provided in the resolution or in the By-Laws ot

the Company, shall have and may exercise the powers of the

Board of Directors in the management of the business and

affairs of the Company, and may authorize the seal of the Co~pany to be affixed to all papers which may require it. Such

committee or oo~itteeB shall have such name or names as may be stated in the By-Laws of the Company or as JIlay be

determined from ti~e to time by resolution adopted by the

Board of Directors.

Cd) When and as authorized by the affirmative vote of the

holders of a majority of the stock issued and outstanding

having voting power given a~ a stockholders I meeting duly called for that purpose, or When authorized by the written

consent of the holders of a majority of the voting stock

issued and outstanding, to sell, lease or exchange all of the

property and assets of the Company, inclUding its good will

and its corporate franchises, upon such terms and conditions

and tor sucb consideration, which ~ay be in whole or 1n part

shares of stock in, and/or other securities of, any other

corporation or corporations, as its Board of Directors shall

deem expedient and for the best interests of the company.

(3) The directors in their discretion may submit any contract

or act for approval or ratification at any annual meeting of the

stockholders or at any ~eet1ng of the stockholders called for the

purpose of considering any such act or contract, and any contract

or act that shall be approved or be ratified by the vote of the

holder6 of a majority of the stock of the Company Which is

represented in person or by proxy at such meeting and entitled to

7
vote thereat (provided that a lawful quorUJ1l of stockholders be

there represented in person or by proxy) shall be as valid and as

bindinq upon the Company and upon all the stockholders, as though

it had been approved or ratified by e.very stockholder of the

Company, whether or not the contract or act would otherwise be open

to legal attack because of directors' interest, or for any other

reason.

(4) The stockholders and directors shall have power to hold

their meetings if tho By-Laws so provide and (except as the laws of

the state of Delaware shall otherwise provide) keep the books,

documents and papers of the company, outside of the state of

Delaware, and to have one or more offices within or without the

state of Dela..are, at such places as may be from thne to time

designated by the By-Laws or by resolution of the stockholders or

directors, except as otherwise required by the laws ot Dela..are.

(5) In addition to the powers and authorities hereinbefore or

by statute expressly conferred upon them, the directors are hereby ~powered to exercise all such powers and do all such acts and

things as may be exercised or done by the Company; SUbject,

nevertheless, to the provisions of the statutes of Delaware, of

this certificate, and to any By-Laws from time to time ~ade by the

stockholders; provided, however, that no By-Laws so made shall

invalidate any prior act of the directors which would have been

valid if such By-Laws had not been made.

ARTICLE NINE.

Transactions with Oirectors.

No contract or other transaction between the Company and any

other corporation, whether or not a majority of the shares of the

capital stock of such other corporation is owned by the Company,

and no act of tho Company shall in any way be affected or

invalidated by the fact that any of the directors of the Company

are financially or otherwise interested in, or are directors or

officers ot, such other corporation; any director individually, or

any firm of which such director ~ay be a =ember, may be a party to,

or may be financially or otherwise interested in, any contract or

transaction of the company, provided that the fact that he or such

firm 1s so interested shall be disclosed or shall have been kno..n

to the Board of Directors or a majority thereat; and any director

of the COlDpany who is also a director or officer of such other

corporation, or who is so interested, may be counted in determining

the existence of a quorum at any meeting of the Board of Directors

of the Company ..hich shall authorize such contract or transaction

and ~y vote thereat to authorize such contract or transaction,

with like force and effect as if he Were not such director or

officer of such other corporation or not so interested.

8
ART! CLE TEN.

Indemnification of Directors and Officers.

The Co~p8ny shall indemnify to the full extent permitted by

law any person made, or threatened to be made, a party to an

action, suit or proceeding (whether civil, criminal, administrative

or investigative) by reason of the fact that he, his testator or

intestate is or was a director, officer or employee Of the company

or serves or served any other enterprise at the request of the

Company.

ARTICLE ELEVEN.

Reservation of Right to Amend

Certificate of Incorporation.

The Company reserves the right to amend, alter, change or

repeal any provision contained in this Certificate of Incorporation

in the manner now or hereafter prescribed by law, and all rights

Bnd powers conferred herein on stockholders, directors and officers

are subject to this reserved power.

ARTICLE TWELVE.

No director of the company shall be liable to the Company or

its stockholders for monetary damages for breach of fiduciary duty

as a director, except to the extent such an exemption froJD

liability or limitation thereof is not permitted under the Delaware

General Corporation Law as presently in effect or as the same may

hereafter be 8Jtlended. No amendlDent to or repeal of these

provisions shall apply to or have any effec~ on the liability or

alleqed liahility of any director of the Company for or with

respect to any acts or omissions of such director occurrinq prior

to such amendment or repeal."

SECOND; That, ~ursuant to resolution of its Board of

Directors, the annual meetinq of the stockholders of said Company

was duly called and held, at which meetinq the necessary number of

shares as required by statute were voted in favor of the aforesaid

amendment.

THIRD: That said restatement and amendment was duly adopted

in accordance with the provisions of Sections 242 and 245 of the

General corporation Law of the State of Delaware.

9
POURTH: That the capital of said Company will not be reduced

under or by reason of said restatement and amendment.

IN WITNESS ~iEREOF, said AMERlCAN INTERNATIONAL GROUP, INC.

has causmi its corporate seal to be hereunto affixed and this

Certificate to be signed by Edward E. Matthews, its Vice Chairman,

and Kathleen E. Shannon, its Secretary this 2nd day of June, 1995.

AMERICAN INT~IONAL. GROUP,

BY-£4(t~ jCeChairman

INC.

BY~lIf~ 5 cret:arY' .

'"

..--

10
STATE OF NEW yoRK )

.> ss. :

COUNTY OF NEW YORlt )

BE IT ~ERED that on this 2nd day ot June, 1995,

personally c~e before me, a Notary Public in and for the county

and state aforesaid, Edward E. Matthews, Vice Chairman of American

International Group, Inc., (the "Company"), a corporation of the

State of Delaware, the company described in and which executed the

foregoing certificate, known to me personally to be such, and he,

the said Edward E. Matthews as such Vice Chairman, duly axecuted

said certificate before me and acknowledged the said certificate to

be his act and deed and the act and deed of said Company; that the

siqnaturQ of the said Vice Chairman and of the Secretary of said

Company to said certificate are in the handwriting ot the said Vice

Chairman and Secretary of said company, respectively, and that the

seal affixed to said certificate is the common or corporate seal of

said Company, and that the facte stated therein are true.

IN WITNESS WHEREOF, I have hereunto set my hand and seal of

office the day and year aforesaid.

11

TOTA... P.12
STATE OF DELAWARE

SECRETARY OF STATE

DIVISION OF CORPORATIONS

FILED 09: 00 AM 06/03/1998

981213417 - 0658607

CERTIFICATE OF AMENDMENT

OF

CERTIFICATE OF INCORPORATJON

AMERlCAN INTERNATIONAL GROUP, INC.

Adopted in accordance with the provisions ofSection 242

ofthe General Corporation Law ofthe State ofDelaware

WE, HOWARD 1. SMITH, Executive Vice President, ChiefFinancial Officer and

Comptroller, and K.ATHLEEN E. SHANNON, Vice President and Secretary of

AMERlCAN INTERNATIONAL GROUP, INC., a corporation existing under the Laws

ofthe State of De1aware, DO HEREBY CERTIFY under the seal ofsaid corporation as

follows:

FIRST: The Restated Certificate ofIncorporation ofsaid corporation, as

amended, has been amended so that the first paragraph of ARTICLE FOUR

thereofshall read in its entirety as follows:

"The total nwnber ofshares of all classes ofstock which the

Company shall have authority to issue is 2,006,000,000, of which

6,000,000 shares are to be Serial Preferred Stock, par value $5.00 per

share (hereinafter called the "Serial Preferred StOCk"), and 2.000,000,000

shares are to be Common Stock. par value $2.50 per share (hereinafter

called the "Common Stock")."

SECOND: That such amendment has been duly adopted in accordance

wilh the provisions ofSection 242 ofthe General Corporation Law ofthe State of

Delaware by the Board ofDirectors ofsaid corporation and by the affinnative

vote of a majority ofthe shares of Common Stock present and entitled to vote at

the May 20, 1998 Annual Meeting ofShareholders dUly called and held upon

notice in accordance with Section 222 ofthe General Corporation Law ofthe

State ofDelaware.
THIRD: That the capital of the corporation will not be reduced under or

by reason ofsaid amendment.

IN WITNESS WHEREOF, we have both signed this certificate and caused the

corporate seal ofthe cOJ'l)oration to be hereunder affixed this 261t1 day ofMay, 1998.

HOW!tt.k=

ATTEST:

-lJI!!f''1n)~ KA EEN E. SHANNON

Vice President and Secretary
STATE OF DELAWARE

:;'~iWfARt'3~ sTiT1'2/04

DIVISION OF CORPORATIONS

FILED 1D2:aO laM 12/30/1998

981507768 - 0658607

CEltTlFICAn OF MERCER

of

SUNAMERICA !NC.

with ud bltv

AMEJUCAN INTERNATIONAL GROUP, INC.

Pursuant to Section 2S2(c) ofthe General Corporation Law ofthe State of

Delaware, Amenc.an lDternationaJ Group, Inc., a Dellwve corporation. hereby certifies

the fonowing information relating to the merier of SunAmerica Inc., a MaryJand

corporation, with and into American International Group, Ine. (the "Merger"):

1. The name and state ofincorporation of each ofAmerican

International GrouP. Inc. and SunAmerita Int. (the "Constituent Corporations") are:

American International Group, Int.

SunAmerica Inc.

Delaware

Maryland

2. The Aas'eement and Plan ofMeJge.r, dated as ofAugust 19. 1998,

between SunAInerica tDt. BIld American lnttm&tionaJ Group, Inc. (the "Merger

Agreement"). setting forth the terms and conditions ofthe Merger, hes b«n approved,

adopted, certified, executed and aclcnowJedpd by each ofthe Constitutnt Corporations in

accordance with the provisions of Section 252(c) oftht General Corporation Law ofthe

State ofDelaw8l'c.

3. The name ofthe :surviving c.orpOratlOD is American lntemational

Group, Inc.

4. The Cutific;ate oflncorporatio» ofAmerican International Group,

Inc. in effect immediately prior to the c.fJ'ective time ofthe m~rger shall be the certificate of

incorpQration ofthe surviving corporation. without any change, alteration or amendment

pursuant to the meTger.

5. The exuuted Merger Agreement is on file at the principal place of

business ofthe sUJ"Viving corporation. whic.h is located at 70 Pine Street., New York, New

York 10270.
(WED) 12. 30' 98 1~:26/ST. I~!: 1G'NO. 35610048i7 P 2/2

6. A copy ofthe Merger Agreement will be furnished by the surviving

coI1'or81ion, on request and without CO~ to any st.ocJdlolder of either ofthe Co~tuent

Corporations.

7. SunAmmc.a Inc. ill a CQrporation duly organized aDd under:

the laws ofthe Sttte ofMaryland having an authorized capital stock consisting of

350,000,000 shares of common stock, par value $1.00 per share. 25,000,000 shares of

1'lontransferable Class B Stock, pat value S1.00 per share, 15,000,000 shares of

Transferable Class B Stoclc, par value $1.00 peJ' d1are, and 20,000,000 shares ofprefe:rred

stoc.k, no par value.

8. This Cenificate ofMerger shall become effective on January 1,

1999 at 3:01 a.m. (New York City rime).

NY12S21; 103712.'
212 315 7978 P.04/04

IN Wl'INESS WHEREOF, AmericanlctemationaJ Oroup. lnt. bas c.a\l$ed

this Certificate ofMergt1' to be t:lCceutcd &5 ofthe ~dlY ofDeccmbeJ, 1998.

AMElUCAN INTERNATIONAL GROUP.lNC.

ATUST:
STATE OF DELAWARE

SEJCRETARY OF STATE

DIVISION OF CORPORATIONS

FILED 09:00 AM 06/05/2000

001284662 - 0658607

CERTIFICATE OF AMENDMENT

OF

CERTIFICATE OF INCORPORATJON

AMERICAN INTERNATIONAL GROUP, INC.

Adopted in accordance with the provisions of Section 242

ofthe General Corporation Law ofthe State ofDelaware

WE, HOWARD 1. SMITH, Executive Vice President and ChiefFinancial Officer,

and KATIll..EEN E. SHANNON, Vice President and Secretary of AMERICAN

INTERNAT10NAL GROUP, INC., a corporation existing under the Laws ofthe State of

Delaware, DO HEREBY CERTIFY under the seal ofsaid corporation as follows:

FlRST: The Restated Cenificate oflncorporation of said corporation, as

amended, hall been amended so that the first paragraph of ARTICLE FOUR

thereofshall read in its entirety as follows:

"The total number ofshares of all classes ofstock which the

Company shall have authority to issue is 5.006)000,000, ofwhich

6,000,000 shares are to be Serial Preferred Stock, par value S5.00 per

share (hereinafter called the "Serial Preferred Stock"), and 5,000,000,000

shares are to be Common Stock. par value $2,50 per share (hereinaft-er

called the "Common Stock")."

SECOND: That such amendment has been duly adopted in accordance

with the provisions of Section 242 ofthe General Corporation Law ofthe State of

Delaware by the Board ofDirectors ofsaid corporation and by the atfumative

vote of a majority ofthe shares ofCornman Stock present and entitled to vote at

the May 17) 2000 Annual Meeting of Shareholders duly caned and held upon

notice in accordance with Section 222 ofthe General Corporation Law ofthe

State ofDelaware.

------_...--_.•..
<-. <: ,~,:, :.;:,,;~:~ TO 13026365454 P.03/04

THIRD: That the capital ofthe corporation will not be reduced under or

by reason ofsaid amendment.

IN WITNESS WHEREOF, we have both signed this certificate and caused the

corporate seal ofthe corporation to be hereunder affixed this S&h day ofJune. 2000.

-, ......

ATTEST:

jjaHtlLuuOJAatrvrtftV

KATHLEEN E. SHANNON

Vice President and Secretary

------
c:... Co (:.:;, 1"5204 TO 13026355454

•

STATE OF NEW YORK

55.:

COUNTY OF NEW YORK

BE IT REMEMBERED that on this Sill day ofJune, 2000, personally came before

me, Sandra A. LeMonds, a Notary Public in and for the County and State aforesaid,

HOWARD 1. SMITII and KArffi.EEN E. SHANNON, Executive Vice President and

ChiefFinancial Officer and Vice President and Secretary, respectively, of AMER1CAN

INTERNATIONAL GROUP, INC., the corporation mentioned in the foregoing

Certificate, to me known and known by me to be the persons whose signatures appear on

the foregoing Cenificate, and they being by me duly sworn did depose and say that they

signed and acknowledged the said Cel1ificate to be their act and deed and the act and

deed ofthe said corporation, and that the seal thereto affixed is the seal ofthe said

corporation.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official

seal the day and year hereinabove written.

>

~4;:;~ Notary Public

eAIlIORA A. L.uoNDB

Noc.y NIIa, ...t:J ....... No.. O1LS01Gat1 _

Qu••cUn"'""" ~., J .~

~~",~ e..n. AprI22, 8lQ",f\

** TOT-AL PAGE. V14 *M

•
AnnexA-2

AMERICAN INTERNATIONAL GROUP, INC.

BY-LAWS

Amended June 15, 2008

ARTICLE I

Stockholders

Section 1.1. Annual Meetings. An arumal meeting ofstockholders shall be held

for the election of directors at such date, time and place either within or without the State of

Delaware as may be designated by the Board of Directors from time to time. Any other proper

business may be transacted at the annual meeting.

Section 1.2. Special Meetings. Special meetings of stockholders for any

purpose or purposes may be called at any time by the Chairn1an, if any, the Chief Executive

Officer, if any, the Secretary or the Board of Directors, to be held at such date, time and place

either within or without the State of Delaware as may be stated in the notice of the meeting. A

special meeting of stockholders shall be called by the Secretary upon the wlitten request, stating

the purpose of the meeting, of stockholders who together own ofrecord twenty-five (25) percent

ofthe outstanding shares of each class ofstock entitled to vote at such meeting.

Section 1.3. Notice of Meetings. Whenever stockllOlders are required or

permitted to take any action at a meeting, a written notice of the meeting shall be given which

shall state the place, date and time of the meeting, and, in the case of a special meeting, the

purpose or purposes for which the meeting is called. Unless otherwise provided by law, the

written notice of any meeting shall be given not less than ten (l0) nor more than sixty (60) days

before the date of such meeting to each stockholder entitled to vote at such meeting. If mailed,

such notice shall be deemed to be given when deposited in the United States mail, postage

prepaid, directed to the stockholder at such stockholder's address as it appears on the records of

the Corporation. No business other than that stated in the notice shall be transacted at any

special meeting without the unanimous consent of all the stockholders entitled to vote thereat.

Section].4. Adjournments. Any meeting of stockholders, annual or special,

may adjourn from time to time to reconvene at the same or some other place, and notice need not

be given of any such adjourned meeting if the time and place thereof are announced at the

meeting at which the adjournment is taken; provided, that if the adjournment is for more than

thirty (30) days, or if after the adjournment a new record date is fixed for the adjourned meeting,

a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at

the meeting. At the adjoumed meeting the Corporation may transact any business which might

have been transacted at the original meeting.
Section 1.5. Quorum. At each meeting ofstockholders, except where otherwise

provided by law or the certificate of incorporation or these by-laws, the holders of a majority of

the outstanding shares of each class of stock entitled to vote at the meeting, present in person or

represented by proxy, shall constitute a quorum. In the absence of a quorum, the stockholders so

present may, by majority vote, adjourn the meeting from time to time in the manner provided by

Section 1.4 of these by-laws until a quorum shall attend. Shares of its own capital stock

belonging on the record date for the meeting to the Corporation or to another corporation, if a

majority of the shares entitled to vote in the election of directors of such other corporation is

held, directly or indirectly, by the Corporation, shall neither be entitled to vote nor be counted for

quorum purposes; proYided, however, that the foregoing shall not limit the right of the

Corporation to vote stock, including but not limited to its own stock, held by it in a fiduciary

capacity.

• Section 1.6. Organization. Meetings of stockholders shall be presided over by

the Chairman, or in the absence of the Chaimlan by the Chief Executive Officer, or in the

absence of the Chief Executive Officer by the Chaimlan of the Nominating and Corporate

Governance Committee, or in the absence of the foregoing persons by a chail111an designated by

the Board of Directors, or in the absence of such designation by a chairman chosen at the

meeting. The Secretary shall act as secretary of the meeting, or in the absence of the Secretary

an Assistant Secretary shall so act, or in their absence the chailman of the meeting may appoint

any person to act as secretary of the meeting.

The order of business at each such meeting shall be as detelmined by the

chairman of the meeting. The chainnan of the meeting shall have the right and authority to

prescribe such rules, regulations and procedures and to do all such acts and things as are

necessary or desirable for the proper conduct of the meeting, including, without limitation, the

establishment of procedures for the maintenance of order and safety, limitations on the time

allotted to questions or comments on the affairs of the Corporation, restrictions on entry to such

meeting after the time prescribed for the commencement thereof and the opening and closing of

the voting polls.

Section 1.7. Inspectors. Prior to any meeting of stockholders, the Board of

Directors or the Chief Executive Officer shall appoint one or more inspectors to act at such

meeting and make a written report thereof and may designate one or more persons as alternate

inspectors to replace any inspector who fails to act. If no inspector or alternate is able to act at

the meeting of stockholders, the person presiding at the meeting shall appoint one or more

inspectors to act at the meeting. Each inspector, before entering upon the discharge of his duties,

shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and

according to the best of his or her ability. The inspectors shall ascertain the number of shares

outstanding and the voting power of each, determine the shares represented at the meeting and

the validity of proxies and ballots, count all yotes and ballots, determine and retain for a

reasonable period a record of the disposition of any challenges made to any determination by the

inspectors and certify their deternlination of the number of shares represented at the meeting and

their count of all votes and ballots. The inspectors may appoint or retain other persons to assist

them in the perf0l111anCe of their duties. The date and time of the opening and closing of the

-2-
polls for each matter upon which the stockholders will vote at a meeting shaJJ be aJIDounced at

the meeting. No baJJot, proxy or vote, nor any revocation thereof or change thereto, shaJJ be

accepted by the inspectors after the closing of the polls. In detemlining the validity and counting

of proxies and ballots, the inspectors shaJJ be limited to an examination of the proxies, any

envelopes submitted therewith, any information provided by a stockholder who submits a proxy

by telegram, cablegram or other electronic transmission from which it can be detemlined that the

proxy was authorized by the stockholder, baJJots and the regular books and records of the

Corporation, and they may also consider other reliable infomlation for the limited purpose of

reconciling proxies and baJJots submitted by or on behalf of banks, brokers, their nominees or

similar persons which represent more votes than the holder of a proxy is authorized by the record

owner to cast or more votes than the stockholder holds ofrecord. Ifthe inspectors consider other

reliable infoD11ation for such purpose, they shaJJ, at the time they make their certification, specify

the precise information considered by them, including the person or persons from whom they

obtained the infomlation, when the infoJTIlation was obtained, the means by which the

information was obtained and the basis for the inspectors' belief that such information is accurate

and reliable.

Section l.8. Classes or Series of Stock; Voting Proxies. For purposes of this

Article I, two or more classes or series of stock shall be considered a single class if and to the

extent that the holders thereof are entitled to vote together as a single class at the meeting.

Unless otherwise provided in the certificate of incorporation, each stockllolder entitled to vote at

any meeting of stockllolders shall be entitled to one vote for each share of stock held by such

stockholder which has voting power upon the matter in question. Each stockholder entitled to

vote at a meeting of stockholders or to express consent or dissent to corporate action in writing

without a meeting may authorize another person or persons to act for such stockholder by proxy,

but no such proxy shaJJ be voted or acted upon after three years from its date, unless the proxy

provides for a longer period. A duly executed proxy shall be irrevocable if it states that it is

irrevocable and if and only as long as, it is coupled with an interest sufficient in law to support an

irrevocable power. A stockllolder may revoke any proxy which is not irrevocable by attending

the meeting and voting in person or by filing an instrument in writing revoking tbe proxy or

another duly executed proxy bearing a later date with the Secretary ofthe Corporation. Voting at

meetings of stockholders need not be by written baJJot and need not be conducted by inspectors

unless the holders of a majority of the outstanding shares of aJJ classes of stock entitled to vote

thereon present in person or by proxy at such meeting shaJJ so determine. At aJJ meetings for the

election of directors, directors shall be elected as provided in Section 2.2 ofthese by-laws. With

respect to other matters, unless otherwise provided by law or by the certificate of incorporation

or these by-laws, the affimlative vote of the holders of a majority of the shares of aJJ classes of

stock present in person or represented by proxy at the meeting and entitled to vote on the subject

matter shall be the act ofthe stockholders, provided that (except as otherwise required by law or

by the certificate of incorporation) the Board of Directors may require in the notice of meeting a

larger vote upon any such matter. Only votes cast "for" or "against" a matter shall be considered

affirmative votes; abstentions, broker non-votes and withheld votes shaJJ not be treated as

affirmative votes and shaJJ not be taken into account in determining whether a matter is

approved. Where a separate vote by class is required, the affirmative vote of the holders of a

majority ofthe shares of each class present in person or represented by proxy at the meeting shall

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be the act of such class, except as otherwise provided by law or by the certificate of

incorporation or these by-laws.

Section 1.9. Fixing Date for Determination of Stockholders ofRecord. In order

that the Corporation may determine the stockholders entitled to notice of or to vote at any

meeting of stockholders or any adjournment thereof, the Board of Directors may fix, a record

date, which record date shall not precede the date upon which the resolution fixing the record

date is adopted by the Board of Directors, and which shall not be more than sixty (60) nor less

than ten (10) days before the date of such meeting. If no record date is fixed by the Board of

Directors the record date for determining stockholders entitled to notice of or to vote at a meeting

of stockholders shall be at the close of business on the day next preceding the day on which

notice is given, or, if notice is waived, at the close of business on the day next preceding the day

on which the meeting is held. A determination of stockholders of record entitled to notice of or

to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided,

however, that the Board of Directors may fix a new record date for the adjourned meeting.

In order that the Corporation may determine the stockholders entitled to consent

to corporate action in writing without a meeting, the Board of Directors may fix a record date,

which record date shall not precede the date upon which the resolution fixing the record date is

adopted by the Board of Directors, and which date shall not be more than ten (l0) days after the

date upon which the resolution fixing the record date is adopted by the Board of Directors. Ifno

record date has been fixed by the Board of Directors, the record date for deternlining

stockholders entitled to consent to corporate action in writing without a meeting, when no prior

action by the Board of Directors is required by law, shall be the first date on which a signed

written consent setting forth the action taken or proposed to be taken is delivered to the

Corporation by delivery to its registered office in the State of Delaware, its principal place of

business, or an officer or agent of the Corporation having custody of the book in which

proceedings of meetings of stockholders are recorded. Delivery made to the Corporation's

registered office shall be by hand or by certified or registered mail, return receipt requested. If

no record date has been fixed by the Board of Directors and prior action by the Board of

Directors is required by law, the record date for determining stockholders entitled to consent to

corporate action in writing without a meeting shall be at the close of business on the day on

which the Board of Directors adopts the resolution taking such prior action.

In order that the Corporation may determine the stockholders entitled to receive

payment of any dividend or other distribution or allotment of any rights or the stockholders

entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for

the purpose of any other lawful action, the Board of Directors may fix a record date, which

record date shall not precede the date upon which the resolution fixing the record date is adopted,

and which record date shall be not more than sixty (60) days prior to such action. If no record

date is fixed, the record date for determining stockholders for any such purpose shall be at the

close of business on the day on which the Board of Directors adopts the resolution relating

thereto.

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Section 1.1 O. List of Stockholders Entitled to Vote. The Secretary shall prepare

and make, at least ten (IO) days before every meeting of stockholders, a complete list of the

stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the

address of each stockholder and the number of shares registered in the name of each stockholder.

Such list shall be open to the examination of any stockholder, for any purpose germane to the

meeting, during ordinary business hours, for a period of at least ten (IO) days prior to the

meeting, either at a place within the city where the meeting is to be held, which place shall be

specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to

be held. The list shall also be produced and kept at the time and place ofthe meeting during the

whole time thereof and may be inspected by any stockholder who is present.

Section 1.1 1. Consent of Stockholders in Lieu of Meeting. Unless otherwise

provided in the certificate of incorporation or these by-laws, any action required by law to be

taken at any annual or special meeting of stockholders of the Corporation, or any action which

may be taken at any annual or special meeting of such stockholders, may be taken without a

meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth

the action so taken, shall be signed by the holders of outstanding stock having not less than the

minimum number of votes that would be necessary to authorize or take such action at a meeting

at which all shares entitled to vote thereon were present and voted and shall be delivered to the

Corporation by delivery to (a) its registered office in the State of Delaware by hand or by

certified mail or registered mail, retum receipt requested, (b) its principal place of business, or

(c) an officer or agent of the Corporation having custody of the book in which proceedings of

meetings of stockholders are recorded. Every written consent shall bear the date of signature of

each stockholder who signs the consent and no written consent shall be effective to take the

corporate action referred to therein unless, within sixty (60) days of the earliest dated consent

delivered in the manner required by this Section 1.11 to the Corporation, written consents signed

by a sufficient number of holders to take action are delivered to the Corporation by delivery to

(a) its registered office in the State of Delaware by hand or by certified or registered mail, retum

receipt requested, (b) its principal place of business, or (c) an officer or agent of the Corporation

having custody of the book in which proceedings of meetings of stockholders are recorded.

Prompt notice of the taking of the corporate action without a meeting by less than unanimous

written consent shall be given to those stockholders who have not consented in writing and who,

if the action had been taken at a meeting, would have been entitled to notice ofthe meeting if the

record date for such meeting had been the date that written consents signed by a sufficient

number of stockholders to take the action were delivered to the Corporation as provided in this

Section 1.11.

Section 1.12. Advance Notice of Stockholder Nominees for Director and Other

Stockholder Proposals. (a) The matters to be considered and brought before any annual or

special meeting of stockholders of the Corporation shall be limited to only such matters,

including the nomination and election of directors, as shall be brought properly before such

meeting in compliance with the procedures set forth in this Section 1.12.

For any matter to be properly brought before any annual meeting of stockholders,

the matter must be (i) specified in the notice of annual meeting given by or at the direction ofthe

-5-
Board of Directors, (ii) otherwise brought before the annual ~1eeting by or at the direction of the

Board of Directors or (iii) brought before the annual meeting in the manner specified in this

Section 1.12(b)(x) by a stockholder that holds ofrecord stock of the Corporation entitled to vote

at the annual meeting on such matter (including any election of a director) or (y) by a person (a

"Nominee Holder") that holds such stock through a nominee or "street name" holder ofrecord of

such stock and can demonstrate to the Corporation such indirect ownership of, and such

Nominee Holder's entitlement to vote, such stock on such matter. In addition to any other

requirements under applicable law, the certificate of incorporation and these by-laws, persons

nominated by stockholders for election as directors of the Corporation and any other proposals

by stockholders shall be properly brought before an annual meeting ofstockholders only if notice

of any such matter to be presented by a stockholder at such meeting (a "Stockholder Notice")

shall be delivered to the Secretary at the principal executive office of the Corporation not less

than ninety (90) nor more than one hundred and twenty (120) days prior to the first anniversary

date of the annual meeting for the preceding year; provided, however, that if and only if the

annual meeting is not scheduled to be held within a period that commences thirty (30) days

before and ends thirty (30) days after such anniversary date (an millual meeting date outside such

period being referred to herein as an "Other Meeting Date"), such Stockholder Notice shall be

given in the manner provided herein by the later of (i) the close of business on the date ninety

(90) days prior to such Other Meeting Date or (ii) the close of business on the tenth (10) day

following the date on which such Other Meeting Date is first publicly announced or disclosed.

Any stockholder desiring to nominate any person or persons (as the case may be) for election as

a director or directors of the Corporation at an annual meeting of stockholders shall deliver, as

part of such Stockholder Notice, a statement in writing setting forth the name of the person or

persons to be nominated, the number and class of all shares of each class of stock of the

Corporation owned of record and beneficially by each such person, as reported to such

stockholder by such person, the information regarding each such person required by paragraphs

(a), (e) and (f) of Item 401 of Regulation S-K adopted by the Securities and Exchange

Commission, each such person's signed consent to serve as a director of the Corporation if

elected, such stockholder's name and address, the number and class of all shares of each class of

stock ofthe Corporation owned ofrecord and beneficially by such stockholder and, in the case of

a Nominee Holder, evidence establishing such Nominee Holder's indirect ownership of stock

and entitlement to vote such stock for the election of directors at the annual meeting. The

Corporation may require any proposed nominee to fumish such other information as it may

reasonably require to determine whether the nominee would be considered "independent" under

the various rules and standards applicable to the Corporation. Any stockholder who gives a

Stockholder Notice of any matter (other than a nomination for director) proposed to be brought

before an annual meeting of stockholders shall deliver, as part of such Stockholder Notice, the

text of the proposal to be presented and a brief written statement of the reasons why such

stockholder favors the proposal and setting forth such stockholder's name and address, the

number and class of all shares of each class of stock of the Corporation owned of record and

beneficially by such stockholder, any material interest ofsuch stockholder in the matter proposed

(other than as a stockholder), if applicable, and, in the case of a Nominee Holder, evidence

establishing such Nominee Holder's indirect ownership of stock and entitlement to vote such

stock on the matter proposed at the annual meeting. As used in these by-laws, shares

"beneficially owned" shall mean all shares which such person is deemed to beneficially own

-6-
pursuant to Rules 13d-3 and ]3d-5 under the Securities Exchange Act of ]934 (the "Exchange

Act"). If a stockJ)older is entitled to vote only for a specific class or category of directors at a

meeting (annual or special), such stocklJolder's right to nominate one or more individuals for

election as a director at the meeting shall be limited to such class or category of directors.

Notwithstanding any provision of this Section ].12 to the contrary, in the event that the number

of directors to be elected to the Board of Directors of the Corporation at the next annual meeting

of stocklJolders is increased by virtue of an increase in the size of the Board of Directors and

either all of the nominees for director at the next annual meeting of stocklJolders or the size of

the increased Board of Directors is not publicly announced or disclosed by the Corporation at

least one hundred (l00) days prior to the first anniversary of the preceding year's annual

meeting, a StockJwlder Notice shall also be considered timely hereunder, but only with respect to

nominees to stand for election at the next annual meeting as the result of any new positions

created by such increase, if it shall be delivered to the Secretary at the principal executive office

of the Corporation not later than the close of business on the tenth (l0) day following the first

day on which all such nominees or the size of the increased Board of Directors shall have been

publicly announced or disclosed.

(b) Except as provided in the immediately following sentence, no matter shall

be properly brought before a special meeting of stockJwlders unless such matter shall have been

brought before the meeting pursuant to the Corporation's notice of such meeting. In the event

the Corporation calls a special meeting of stocklJolders for the purpose of electing one or more

directors to the Board of Directors, any stockJ)older entitled to vote for the election of such

director(s) at such meeting may nominate a person or persons (as the case may be) for election to

such position(s) as are specified in the Corporation's notice of such meeting, but only if the

StocklJolder Notice required by Section] .11 (b) hereof shall be delivered to the Secretary at the

principal executive office ofthe Corporation not later than the close of business on the tenth (l0)

day following the first day on which the date of the special meeting and either the names of all

nominees proposed by the Board of Directors to be elected at such meeting or the number of

directors to be elected shall have been publicly announced or disclosed.

(c) For purposes of this Section 1.12, a matter shall be deemed to have been

"publicly announced or disclosed" if such matter is disclosed in a press release reported by the

Dow Jones News Service, the Associated Press or a comparable national news service or in a

document publicly filed by the Corporation with the Securities and Exchange Commission.

(d) In no event shall the adjournment of an annual meeting or a special

meeting, or any announcement thereof, commence a new period for the giving of notice as

provided in this Section 1.12. This Section 1.] 2 shall not apply to (i) any stocklJolder proposal

made pursuant to Rule 14a-8 under the Exchange Act or (ii) any nomination of a director in an

election in which only the holders of one or more series of Preferred Stock of the Corporation

issued pursuant to Article FOUR of the certificate of incorporation are entitled to vote (unless

otherwise provided in the terms ofsuch stock).

(e) The chainnan of any meeting of stocklJolders, in addition to making any

other detern1inations that may be appropriate to the conduct ofthe meeting, shall have the power

-7-
and duty to detem1ine whether notice of nominees and oth'er matters proposed to be brought

before a meeting has been duly given in the manner provided in this Section 1.12 and, if not so

given, shall direct and declare at the meeting that such nominees and other matters shall not be

considered.

Section 1.13. Approval of Stockholder Proposals. Except as otherwise required

by law, any matter (other than a nomination for director) that has been properly brought before

an annual or special meeting of stockholders of the Corporation by a stockholder (including a

Nominee Holder) in compliance with the procedures set forth in Section 1.12 and any

stockholder proposal pursuant to Rule 14a-8 shall require for approval thereof the affim1ative

vote ofthe holders of not less than a majority of all outstanding shares of Common Stock of the

Corporation and all other outstanding shares of stock of the Corporation entitled to vote on such

matter, with such outstanding shares of Common Stock and other stock considered for this

purpose as a single class. Any vote of stockholders required by this Section 1.13 shall be in

addition to any other vote of stockholders of the Corporation that may be required by law, the

certificate of incorporation or these by-laws, by any agreement with a national securities

exchange or otherwise.

Section 1.14. Reimbursement. If a stockholder (including a Nominee Holder)

has brought a matter before an annual or special meeting of stockholders of the Corporation and

the matter is included in the Corporation's proxy materials pursuant to Rule 14a-8 under the

Exchange Act and is approved by the affirmative vote of not less than a majority of all

outstanding shares of Common Stock of the Corporation and all other outstanding shares ofstock

of the Corporation entitled to vote on such matter (with such outstanding shares of Common

Stock and other stock considered for this purpose as a single class), the Corporation shall

reimburse the stockholder for all reasonable out-of-pocket costs and expenses incurred in

bringing the matter before the meeting of stockholders, including reasonable out-of-pocket costs

and expenses incurred in opposing any efforts by the Corporation to (i) exclude the matter from

the Corporation's proxy materials and (ii) solicit votes in opposition; provided, however, that

such reimbursement shall not exceed the amount spent by the Corporation in efforts to exclude

the matter from the Corporation's proxy materials and solicit votes in opposition.

ARTICLE 11

Board of Directors

Section 2.1. Powers; Number; Qualifications. The business and affairs of the

Corporation shall be managed by or under the direction ofthe Board of Directors, except as may

be otherwise provided by law or in the certificate of incorporation. The Board shall consist of

not less than seven nor more than twenty-one (21) members, the number thereof to be

detem1ined from time to time by the Board; provided, however, that in determining the number

of directors no account shall be taken of any non-voting director, including any advisory or

honorary director, that may be elected from time to time by a majority of the Board of Directors.

The number of directors may be increased by amendment of these by-laws by the affirmative

vote of a majority of the directors then in office, although less than a quorum, or by the

-8-
affirmative vote of the holders of a majority of the outstanding shares of all classes of stock

entitled to vote thereon, and by like vote the additional directors may be elected to hold office

until the next succeeding annual meeting ofstockholders and until their respective successors are

elected and qualified or until their respective earlier resignations or removals. Directors need not

be stockholders.

Section 2.2. Election; Teml of Office; Resignation; Removal; Vacancies. Each

director shall hold office until the annual meeting of stockholders next succeeding his or her

election and until his or her successor is elected and qualified or until his or her earlier

resignation or removal. Any director may resign at any time upon written notice to the Board of

Directors or to the Chairman or the Secretary of the Corporation. Such resignation shall take

effect at the time specified therein, and no acceptance of such resignation shall be necessary to

make it effective. Any director or the entire Board of Directors may be removed, with or without

cause, by the affirmative vote of holders of a majority of the shares then entitled to vote at an

election of directors; and any vacancy so created may be filled by the affirmative vote of holders

of a majority of the shares then entitled to vote at an election of directors. Whenever the holders

of any class or series of stock are entitled to elect one or more directors by the provisions of the

certificate of incorporation, the provisions of the preceding sentence shall apply, in respect to the

removal without cause of a director or directors so elected, to the vote of the holders of the

outstanding shares of that class or series and not to the vote ofthe outstanding shares as a whole.

Unless otherwise provided in the certificate of incorporation or these by-laws, vacancies (other

than any vacancy created by removal of a director by shareholder vote) and newly created

directorships resulting from any increase in the authorized number of directors elected by all of

the stockholders having the right to vote as a single class or from any other cause may be filled

by a majority of the directors then in office, although less than a quorum, or by the sole.

remaining director. Whenever the holders of any class or classes of stock or series thereof are

entitled to elect one or more directors by the provisions of the certificate of incorporation,

vacancies and newly created directorships of such class or classes or series may, unless

otherwise provided in the certificate of incorporation, be filled by a majority of the directors

elected by such class or classes or series thereof then in office, or by the sole remaining director

so elected.

Except as may be otherwise required by the Certificate of Incorporation, each

director shall be elected by the vote of the majority of the votes cast (meaning the number of

shares voted "for" a nominee must exceed the number of shares voted "against" such nominee)

at any meeting for the election of directors at which a quorum is present, provided that the

directors shall be elected by a plurality of the votes cast (instead of by votes for or against a

nominee) at any meeting involving a contested election for one or more directors (meaning more

directors have been nominated for election than directorship positions available). Abstentions

and broker non-votes will not be deemed a vote "for" or "against" a director. The Corporation's

Corporate Governance Guidelines contain the Corporation's policy regarding the director

resignation process.

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Section 2.3. Regular Meetings. Regular meetings of the Board of Directors

may be held at such places within or without the State of Delaware and at such times as the

Board may from time to time detennine, and ifso determined notice thereof need not be given.

Section 2.4. Special Meetings. Special meetings ofthe Board of Directors may

be held at any time or place within or without the State of Delaware whenever called by the

Chairn1an or by the Chief Executive Officer or the Lead Independent Director on the written

request of any two directors. Reasonable notice thereof, which may be by telephone or email,

shall be given by the person calling the meeting.

Section 2.5. Participation in Meetings by Conference Telephone Pern1itted.

Unless otherwise restricted by the certificate of incorporation or these by-laws, members of the

Board of Directors, or any committee designated by the Board, may participate in a meeting of

the Board or of such committee, as the case may be, by means of conference telephone or similar

communications equipment by means of which all persons participating in the meeting can hear

each other, and participation in a meeting pursuant to this Section 2.5 shall constitute presence in

person at such meeting.

Section 2.6. Quorum; Vote Required for Action. At all meetings of the Board

of Directors a majority of the entire Board shall constitute a quorum for the transaction of

business. The vote of a majority of the directors present at a meeting at which a quorum is

present shall be the act of the Board unless the certificate of incorporation or these by-laws shall

require a vote of a greater number. In case at any meeting of the Board a quorum shall not be

present, a majority of the members of the Board present may adjoum the meeting from time to

time until a quorum shall attend, and notice need not be given of any such adjourned meeting if

the time and place thereof are announced at the meeting at which adjournment is taken.

Section 2.7. Chaim1an. The Board of Directors shall alIDually select one of its

members to be Chairman and shall fill any vacancy in the position of Chainnan at such time and

in such manner as the Board of Directors shall determine.

Section 2.8. Lead Independent Director. Those members of the Board of

Directors who are independent under the New York Stock Exchange listing standards shall

annually select one oftheir number to be Lead Independent Director and shall fill any vacancy in

the position of Lead Independent Director at such time and in such manner as the Board of

Directors shall determine.

Section 2.9. Organization. Meetings ofthe Board ofDirectors shall be presided

over by the Chairman or, in the absence of the Chairman, by the Lead Independent Director, or

in their absence, by a director so chosen at the meeting. The Secretary, or in the absence of the

Secretary an Assistant Secretary, shall act as secretary of the meeting, but in the absence of the

Secretary and any Assistant Secretary, the chairman of the meeting may appoint any person to

act as secretary ofthe meeting.

Section 2.1 O. Action by Directors Without a Meeting. Unless otherwise

restricted by the certificate of incorporation or these by-laws, any action required or permitted to

-10-
be taken at any meeting of the Board of Directors, or of any committee thereof, may be taken

without a meeting if all members of the Board or ofsuch committee, as the case may be, consent

thereto in writing, and the writing or writings are filed with the minutes of proceedings of the

Board or committee.

Section 2.11. Compensation of Directors. The Board of Directors shall have the

authority to fix the compensation of directors.

Section 2.12. Approval or Ratification of Chief Executive Officer

Compensation. The detennination of the Compensation and Management Resources Committee

(or such other committee of the Board of Directors assigned to make such detern1ination) with

respect to the compensation of the Chief Executive Officer shall be subject to the approval or

ratification of the Board. Any director who is also an employee of the Corporation or any of its

subsidiaries shall recuse himself or herself from the deliberations and vote of the Board to

approve or ratify the compensation ofthe Chief Executive Officer.

ARTICLE III

Committees

Section 3. l. Committees. The Board of Directors may, by resolution passed by

a majority of the whole Board, designate one or more committees, each committee to consist of

two or more of the directors of the Corporation. The Board may designate one or more directors

as alternate members of any committee, who may replace any absent or disqualified member at

any meeting of the committee. In the absence or disqualification of a member of a committee,

the member or members thereof present at any meeting and not disqualified from voting,

whether or not such member or members constitute a quorum, may unanimously appoint another

member of the Board to act at the meeting in place of any such absent or disqualified member.

Any such committee, to the extent permitted by applicable law and provided in the resolution of

the Board or in these by-laws, shall have and may exercise all the powers and authority of the

Board in the management of the business and affairs of the Corporation, and may authorize the

seal ofthe Corporation to be affixed to all papers which may require it. The standing committees

of the Board of Directors shall be the Audit Committee, the Nominating and Corporate

Governance Committee, the Compensation and Management Resources Committee, such

additional committees as may be required by the New York Stock Exchange listing standards or

other applicable law and such additional committees as the Board of Directors may designate

pursuant to this Section 3.1, in each case with such name or names as may be stated in these bylaws or as may be determined from time to time by resolution adopted by the Board of Directors.

The committees shall keep regular minutes of their proceedings and report the same to the Board

ofDirectors when required.

The Executive Committee, if one shall be designated, to the extent pem1itted by

applicable law shall have and may exercise all the powers and authority ofthe Board ofDirectors

in the management of the business and affairs of the Corporation, and may authorize the seal of

the Corporation to be affixed to all papers which may require it. Except as otherwise provided

-11-
from time to time in resolutions passed by a majority of the whole Board of Directors, the

powers and authority of the Executive Committee shall include the power and authority to

declare a dividend on stock, to authorize the issuance of stock and to adopt a certificate of

ownership and merger pursuant to Section 253 of the Delaware General Corporation Law.

Except as otherwise provided from time to time in resolutions passed by a majority of the whole

Board of Directors, the power and authority of the Executive Committee shall not include the

power or authority to nominate persons to serve as directors or to fill vacancies or newly created

directorships, which power and authority shall be vested in the Board of Directors.

Section 3.2. Committee Rules. Unless the Board of Directors otherwise

provides, each committee designated by the Board may adopt, amend and repeal rules for the

conduct of its business. In the absence of a provision by the Board or a provision in the rules of

such committee to the contrary, a majority of the members of such committee shall constitute a

quorum for the transaction of business, the vote of a majority of the members present at a

meeting at the time of such vote if a quorum is then present shall be the act of such committee,

and in other respects each committee shall conduct its business in the same manner as the Board

conducts its business pursuant to Article II ofthese by-laws.

ARTICLE IV

Officers

Section 4.1. Officers; Election. As soon as practicable after the annual meeting

of stockholders in each year, the Board of Directors shall elect a Chief Executive Officer and a

Secretary, and it may, ifit so determines, elect one or more Vice Chairmen. The Board may also

elect a President, one or more Vice Presidents, one or more Assistant Vice Presidents, one or

more Assistant Secretaries, a Treasurer and one or more Assistant Treasurers and such other

officers as the Board may deem desirable or appropriate and may give any of them such further

designations or alternate titles as it considers desirable. Any number of offices may be held by

the same person.

Section 4.2. Term of Office; Resignation; Removal; Vacancies. Except as

otherwise provided in the resolution of the Board of Directors electing any officer each officer

shall hold office until the first meeting ofthe Board after the annual meeting ofstockholders next

succeeding his or her election, and until his or her successor is elected and qualified or until his

or her earlier resignation or removal. Any officer may resign at any time upon written notice to

the Board or to the Chairman or to the Chief Executive Officer or to the Secretary of the

Corporation. Such resignation shall take effect at the time specified therein, and no acceptance

of such resignation shall be necessary to make it effective. The Board may remove any officer

with or without cause at any time. Any such removal shall be without prejudice to the

contractual rights ofsuch officer, if any, with the Corporation, but the election of an officer shall

not of itself create contractual rights. Any vacancy occurring in any office ofthe Corporation by

death, resignation, removal or otherwise may be filled for the unexpired portion of the term by

the Board at any regular or special meeting.

-12-
Section 4.3. Chief Executive Officer. The Chief Executive Officer shall have

general charge and supervision of the business of the Corporation and shall perform all duties

incident to the office of a Chief Executive Officer of a corporation and such other duties as may,

from time to time, be assigned to him or her by the Board.

Section 4.4. Vice Chairman. Any Vice Chaimlan shall have and may exercise

such powers as may, from time to time, be assigned to him or her by the Board or the Chief

Executive Officer.

Section 4.5. Vice Presidents. Vice Presidents include all Executive Vice

Presidents and Senior Vice Presidents. The Vice President or Vice Presidents shall have such

powers and shall perfoml such other duties as may, from time to time, be assigned to him or her

or them by the Board or the Chief Executive Officer or as may be provided by law.

Section 4.6. Secretary. The Secretary shall have the duty to record or cause to

be recorded the proceedings of the meetings of the stockholders, the Board of Directors and any

committees in a book to be kept for that purpose, shall see that all notices are duly given in

accordance with the provisions of these by-laws or as required by law, shall be custodian of the

records of the Corporation, may affix the corporate seal to any document the execution of which,

on behalf ofthe Corporation, is duly authorized, and when so affixed may attest the same, and, in

general, shall perfoml all duties incident to the office ofsecretary of a corporation and such other

duties as may, from time to time, be assigned to him or her by the Board or the Chief Executive

Officer or as may be provided by law.

Section 4.7. Treasurer. The Treasurer shall have charge of and be responsible

for all funds, securities, receipts and disbursements of the Corporation and shall deposit or cause

to be deposited, in the name of the Corporation, all moneys or other valuable effects in such

banks, trust companies or other depositories as shall, from time to time, be selected by or under

authority of the Board of Directors. ]frequired by the Board, the Treasurer shall give a bond for

the faithful discharge of his or her duties, with such surety or sureties as the Board may

determine. The Treasurer shall keep or cause to be kept full and accurate records of all receipts

and disbursements in books ofthe Corporation, shall render to the Chief Executive Officer and to

the Board, whenever requested, an account of the financial condition of the Corporation, and, in

general, shall perform all the duties incident to the office of treasurer of a corporation and such

other duties as may, from time to time, be assigned to him or her by the Board or the Chief

Executive Officer or as may be provided by law.

Section 4.8. Other Officers. The other officers, if any, of the Corporation,

including any Assistant Vice Presidents, Assistant Treasurers and Assistant Secretaries, shall

have such powers and duties in the management of the Corporation as shall be stated in a

resolution of the Board of Directors which is not inconsistent with these by-laws and, to the

extent not so stated, as generally pertain to their respective offices, subject to the control of the

Board. The Board may require any officer, agent or employee to give security for the faithful

performance of his or her duties.

-13-
ARTICLE V

Stock

Section 5.1. Certificates. Except as otherwise determined by the Board of

Directors, every holder of stock in the Corporation shall be entitled to have a certificate signed

by or in the name of the Corporation by the Chairman or a Vice Chairman, if any, or the Chief

Executive Officer, if any, or a Vice President and by the Treasurer or an Assistant Treasurer, or

the Secretary or an Assistant Secretary, of the Corporation, certifying the number of shares

owned by such holder in the Corporation. Ifsuch cel1ificate is manually signed by one officer or

manually countersigned by a transfer agent or by a registrar, any other signature on the certificate

may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose

facsimile signature has been placed upon a certificate shall have ceased to be such officer,

transfer agent or registrar before such certificate is issued, it may be issued by the Corporation

with the same effect as if such person were such officer, transfer agent or registrar at the date of

Issue.

Section 5.2. Lost, Stolen or Destroyed Stock Certificates; Issuance of New

Certificates. The Corporation may issue a new certificate of stock in the place of any certificate

theretofore issued by it, alleged to have been lost, stolen or destroyed, and the Corporation may

require the owner ofthe lost, stolen or destroyed certificate, or such owner's legal representative,

to give the Corporation a bond sufficient to indemnify it against any claim that may be made

against it on account of the alleged loss, theft or destruction of any such certificate or the

issuance of such new certificate.

ARTICLE VI

Miscellaneous

Section 6.1. Fiscal Year. The fiscal year of the Corporation shall be the

calendar year.

Section 6.2. Seal. The Corporation may have a corporate seal which shall have

the name of the Corporation inscribed thereon and shall be in such form as may be approved

from time to time by the Board of Directors. The corporate seal may be used by causing it or a

facsimile thereofto be impressed or affixed or in any other manner reproduced.

Section 6.3. Waiver of Notice of Meetings of Stockholders, Directors and

Committees. Whenever notice is required to be given by law or under any provision of the

certificate of incorporation or these by-laws, a written waiver thereof, signed by the person

entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to

notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting,

except when the person attends a meeting for the express purpose of objecting, at the beginning

of the meeting, to the transaction of any business because the meeting is not lawfully called or

convened. Neither the business to be transacted at, nor the purpose of, any regular or special

meeting of the stockholders, directors or members of a committee of directors need be specified

-14-
in any written waiver of notice unless so required by the certificate of incorporation or these bylaws.

Section 6.4. Indemnification of Directors, Officers and Employees.

I. Indemnification - General.

(a) Except as provided in Section 6.4(3), the Corporation shall

indemnify the Indenmitees to the full extent pem1itted by Delaware law.

(b) For the purposes of this Section 6.4, the tel111 "Indemnitee" shall

mean any person made or threatened to be made a party to any civil, criminal, administrative or

investigative action, suit or proceeding by reason of the fact that such person or such person's

testator or intestate is or was a director, officer or employee of the Corporation or serves or

served at the request of the Corporation any other enterprise as a director, officer or employee.

(c) For purposes of this Section 6.4, the term "Corporation" shall

include any predecessor of the Corporation and any constituent corporation (including any

constituent of a constituent) absorbed by the Corporation in a consolidation or merger; the tel111

"other enteJ1lrise" shall include any corporation, partnership, joint venture, tlllst or employee

benefit plan; service "at the request of the Corporation" shall include service as a director,

officer, employee or agent of the COJ1loration which imposes duties on, or involves services by,

such director, officer, employee or agent with respect to an employee benefit plan, its

participants or beneficiaries; any excise taxes assessed on a person with respect to an employee

benefit plan shall be deemed to be an Expense; and action by a person with respect to an

employee benefit plan which such person reasonably believes to be in the interest of the

participants and beneficiaries of such plan shall be deemed to be action not opposed to the best

interests ofthe Corporation.

2. Expenses.

(a) Expenses reasonably incurred by Indemnitee in defending any such action,

suit or proceeding, as described. in Section 6.4(1 )(b), shall be paid or reimbursed by the

COJ1loration promptly upon receipt by it of an undertaking of Indemnitee to repay such expenses

if it shall ultimately be detem1ined that he or she is not entitled to be indemnified by the

COJ1loration.

(b) For the purposes of this Section 6.4, the tel111 "Expenses" shall include all

reasonable out of pocket fees, costs and expenses, including without limitation, attorneys' fees,

retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating

costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other

disbursements or expenses of the types customarily incurred in connection with defending,

preparing to defend, or investigating an action, suit or proceeding, whether civil, criminal,

administrative or investigative but shall exclude the costs of acquiring and maintaining an appeal

or supersedeas bond or similar instlllment. For the avoidance of doubt, "Expenses" shall not

include (i) any amounts incurred in an action, suit or proceeding in which Indemnitee is a

-15-
plaintiff and (ii) any amounts incurred in connection with any non-compulsory counterclaim

brought by the Indemnitee.

3. Limitations. The Corporation shall not indemnify Indemnitee or advance

lndenmitee's Expenses if the action, suit or proceeding alleges (l) claims under Section 16 ofthe

Securities Exchange Act of 1934 or (2) violations of Federal or state insider trading laws, unless,

in the case of this clause (2), Indemnitee has been successful on the merits or settled the case

with the written consent of the Corporation, in which case the Corporation shall indemnify and

reimburse Indemnitee.

4. Standard of Conduct. No claim for indemnification shall be paid by the

Corporation unless the Corporation has detennined that Indemnitee acted in good faith and in a

manner Indenmitee reasonably believed to be in or not opposed to the best interest of the

Corporation and, with respect to any criminal action or proceeding, had no reasonable cause to

believe that his or her conduct was unlawful. Unless ordered by a court, such detenninations

shall be made by (l) a majority vote of the directors who are not parties to the action, suit or

proceeding for which indemnification are sought, even though less than a quorum, or (2) by a

committee of such directors designated by a majority vote of directors, even though less than a

quorum, or (3) if there are no such directors, or if such directors direct, by independent legal

counsel in a written opinion, or (4) by stockholders.

5. Period of Indemnity. No claim for indemnification or the reimbursement

of Expenses shall be made by Indemnitee or paid by the Corporation unless the Indemnitee gives

notice of such claim for indemnification within one year after the Indemnitee received notice of

the claim, action, suit or proceeding.

6. Confidentiality. Except as required by law or as otherwise becomes public

through no action by the Indenmitee or as necessary to assert Indemnitee's rights under this

Section 6.4, Indenmitee will keep confidential any infonnation that arises in connection with this

Section 6.4, including but not limited to, claims for indenmification or reimbursement of

Expenses, amounts paid or payable under this Section 6.4 and any communications between the

parties.

7. Subrogation. In the event of payment under this Section 6.4, the

Corporation shall be subrogated to the extent of such payment to all of the rights of recovery of

Indenmitee (under any insurance policy or otherwise), who shall execute all papers required and

shall do everything necessary to secure such rights, including the execution of such documents

necessary to enable the Corporation to effectively bring suit to enforce such rights.

8. Notice by Indenmitee.Indemnitee shall promptly notify the Corporation in

wntmg upon being served with any summons, citation, subpoena, complaint, indictment,

infonnation or other document relating to any matter which may be subject to indemnification or

reimbursement of Expenses covered by this Section 6.4. As a condition to indemnification or

reimbursement of expenses, any demand for payment by Indenmitee hereunder shall be in

writing and shall provide an accounting of the amounts to be paid by Corporation (which shall

include detailed invoices and other relevant documentation).

-16-
9. Venue. Any action, suit or proceeding regarding indemnification or

advancement or reimbursement of Expenses alising out of the by-laws or otherwise shall only be

brought and heard in Delaware Court ofChancery.

10. Amendment. No amendment of this Section 6.4 shall impair the rights of

any Indemnitee arising at any time with respect to events occurring prior to such amendment.

Section 6.5. Interested Directors; Quorum. No contract or transaction between

the Corporation and one or more of its directors or officers, or between the Corporation and any

other corporation, partnership, association or other organization in whkh one or more of its

directors or officers are directors or officers, or have a financial interest, shall be void or voidable

solely for this reason, or solely because the director or officer is present at or participates in the

meeting of the Board of Directors or committee thereof which authorizes the contract or

transaction, or solely because his or her or their votes are counted for such purpose, if: (l) the

material facts as to his or her relationship or interest and as to the contract or transaction are

disclosed or are known to the Board or the committee, and the Board or committee in good faith

authorizes the contract or transaction by the affimlative votes of a majority of the disinterested

directors, even though the disinterested directors be less than a quorum; or (2) the material facts

as to his or her relationship or interest and as to the contract or transaction are disclosed or are

known to the stockholders entitled to vote thereon, and the contract or transaction is specifically

approved in good faith by vote ofthe stockholders; or (3) the contract or transaction is fair as to

the Corporation as of the time it is authorized, approved or ratified, by the Board, a committee

thereof or the stockholders. Common or interested directors may be counted in detemlining the

presence of a quorum at a meeting of the Board or of a committee which authorizes the contract

or transaction.

Section 6.6. Form of Records. Any records maintained by the Corporation in

the regular course of its business, including its stock ledger, books of account and minute books,

may be kept on, or be in the foml of, punch cards, magnetic tape, photographs,

microphotographs or any other infomlation storage device, provided that the records so kept can

be converted into clearly legible foml within a reasonable time. The Corporation shall so

convert any records so kept upon the request of any person entitled to inspect the same.

Section 6.7. Dividends. Subject to the provisions of the certificate of

incorporation, the Board of Directors may, out of funds legally available therefor at any regular

or special meeting, declare dividends upon the capital stock ofthe Corporation as and when they

deem expedient. Before declaring any dividend, the Board may cause to be set apart out of any

funds of the Corporation available for dividends, such sum or sums as the directors from time to

time in their discretion deem proper for working capital or as a reserve fund to meet

contingencies or for equalizing dividends or for such other purposes as the directors shall deem

conducive to the interests ofthe Corporation.

Section 6.8. Amendment of By-Laws. These by-laws may be amended or

repealed, and new by-laws adopted, by the affirmative vote of a majority of the Board of

-17-
Directors, but the holders of a majority of the shares then entitled to vote may adopt additional

by-laws and may amend or repeal any by-law whether or not adopted by them.

-18-
Annex B
•
AMERICAN INTERNATJONAL GROUP, INC.

RESOLUTIONS OF THE BOARD OF DIRECTORS

NOVEMBER 9, 2008

Issuance of Preferred Stock and Warrants

RESOLYEO, that this Board ofOirectors (the "Board") hereby approves the

issuance of, and the Corporation be and hereby is authorized to issue (i) $40 billion

aggregate liquidation preference of preferred stock, par value $5.00 per share, ofthe

Corporation (the "Preferred Stock") and (ii) warrants to purchase a number ofshares of

common stock, par value $2.50 per share (the "Common Stock"), ofthe Corporation equal

to 2 percent ofthe issued and outstanding shares (the "Warrant Shares") ofCommon Stock,

of the Corporation on the date ofsuch issuance (the "Warrants"), in each case on

substantially the terms and conditions presented to the Board at this meeting, as set forth on

Annex A hereto with such changes as the Chairman and ChiefExecutive Officer, any Vice

Chairman, any Executive Vice President, the Secretary or the Treasurer (each, an

"Authorized Officer") of the Corporation may deem necessary, desirable or appropriate;

RESOLYED, that this Board hereby detem1ines that the consideration for the

Preferred Stock shall be the cash payment of $10,000 per share and that such consideration

is adequate consideration for the Preferred Stock. The Board hereby declares that a portion

ofsuch consideration equal to $5.00 per'share shall become part of, and shall be credited to,

the capital of the Corporation upon issuance ofthe Preferred Stock. All shares ofthe

Preferred Stock when issued shall be validly issued, fully paid and nonassessable;

RESOLYED, that the Corporation is authorized to issue up to such number of

shares of Common Stock, and/or to transfer such number ofshares ofCommon Stock as

may be held as treasury shares, as are required to be issued or delivered in connection with

the exercise ofthe Warrants; and that the Board hereby instructs the Secretary ofthe

Corporation to initially reserve, or cause to be reserved, the gross number ofshares

issuable upon exercise in full ofthe Wan"ants, with suc·h number ofshares of Common

Stock being increased or decreased from time to time with no further action ofthis Board

or any committee thereof upon anti-dilution adjustments, if any;

RESOLYED, that this Board hereby determines that the consideration for the.

issuance ofthe Warrant Shares shall be the cash payment described in Annex A (subject to

anti-dilution adjustment as provided in the Warrants) or the withholding of a number of

shares of Common Stock with a value equal to the exercise price as calculated in

accordance with the terms ofthe Warrants, and that such consideration is adequate

consideration for the Warrant Shares. The Board hereby declares that a portion ofsuch

consideration equal to the then par value ofthe Common Stock per share shall become part
of, and shall be credited to, the capital ofthe Corporation upon issuance of each Warrant

Share upon exercise of a Warrant. All ofthe Warrant Shares when issued in accordance

with the Warrant shall be validly issued, fully paid and nonassessable;

Amendment to Credit Agreement

FURTHER RESOLYED, that the Corporation be and hereby is authorized to enter

into an amendment to the Credit Agreement, dated as of September 22, 2008, as amended

(the "Credit Agreement"), between the Corporation and the Federal Reserve Bank ofNew

York on substantially the terms and conditions presented to the Board at this meeting, as

set forth on Annex B hereto (the "Credit Agreement Amendment"), with such amendments

and changes as any Authorized Officer may deem necessary, desirable or appropriate, such

necessity, desirability or appropriateness to be conclusively evidenced by the execution of

the Credit Agreement Amendment;

Securities Lending Program

FURTHER RESOLYED, that this Board hereby approves the fomlation of a new

entity (the "SLP Entity") in such form and under the laws ofsuch jurisdiction as any

Authorized Officer may determine, such determination to be conclusively evidenced by

the establishment thereof; and that the Corporation be and hereby is authorized to cause

subsidiaries who participate in the Corporation's securities lending program, directly or

though AIG Global Securities Lending Corp., as agent for those participants, to (i) transfer

residential mortgage-backed securities held as collateral for loans in the Corporation's

securities lending program to the SLP Entity, (ii) accept in exchange therefor securities

issued by the SLP Entity, and (iii) sell those securities to the Federal Reserve Bank ofNew

York and the Corporation (or designees thereof), .in each case in amounts and on

substantially the tenns and conditions presented to the Board at this meeting, asset forth on

Annex C hereto (the "SLP Arrangement"), with such amendments or changes thereto as

any Authorized Officer may deem necessary, desirable or appropriate;

Exposure to Multi-Sector Credit Default Swaps

FURTHER RESOLYED, that this Board hereby approves the formation of a new

entity (the "CDO Entity" and, together with the SLP Entity, the "Entities"), in such fonn

and under the laws ofsuch jurisdiction as any Authorized Officer may de'termine, such

detennination to be conclusively evidenced by the establishment thereof; that the

Corporation be and hereby is authorized to (i) provide capital (in the form of equity or

otherwise as any Authorized Officer may determine) to CDO Entity in an amount up to $5

bilJion, (ii) cause one or more of its subsidiaries to negotiate for the termination of credit

derivative transactions relating to underlying assets being acquired by CDO Entity (the

"CDS Transactions") and (iii) to the extent necessary or required, cause one or more

subsidiaries to contribute to the cost ofterminating the CDS Transactions, in each case on

substantially the terms and conditions presented to the Board at this meeting, as set forth on

2

•
Annex 0 hereto (the "COO Arrangement"), with such amendments or changes thereto as

any Authorized Officer may deem necessary, desirable or appropriate;

Establishment of Entities

FURTHER RESOLVED, that each Authorized Officer be, and each ofthem hereby

is, authorized in the name and on behalf ofthe Corporation, and on behalf of either Entity

in the name ofthe Corporation, as inc.orporator, sponsor, depositor or originator, to select

one or more employees ofthe Corporation or any subsidiary to act as directors, partners,

members, managers, trustees, trust administrators, or attorneys-in-fact or agents for such

Entity (each, an "Administrative Agent") as any Authorized Officer may determine;

FURTHER RESOLVED, that each Authorized Officer be, and each ofthem hereby

is, authorized in the name and on behalf ofthe Corporation, and on behalf of either Entity

in the name ofthe Corporation, as incorporator, sponsor, depositor or originator, to execute

or cause to be executed, and to direct any Administrative Agent to execute or cause to be

executed, organizational documents or agreements or instruments in connection with the

establishment ofthe Entity, and to file or cause to be filed with the applicable authority in

the jurisdiction offormation ofthe Entity, any and all documents to create and to give

continuing effect to the Entity, in each case as any Authorized Officer may determine; and

that each such document, agreement or instrument shall be in such form and contain such

terms and provisions as any Authorized Officer shall approve, such approval to be

conclusively evidenced by the execution or filing thereof;

Authorization of Finance Committee

FURTHER RESOLVED, that this Board hereby delegates to the Finance

Committee ofthis Board all the power and authority ofthis Board with respect to the

Preferred Stock and Warrants, the Credit Agreement Amendment, the SLP Arrangement

and the COO Arrangement, and the Finance Committee be and hereby is authorized to take

any action that the Board could have taken with respect to these matters;

General

FURTHER RESOLVED, that each Authorized Officer be, and each ofthem hereby

is authorized and empowered, on behalf ofthe Corporation, and in its name and in the

name of each Entity, (i) to execute or cause to be executed any agreement, document,

certificate or instrument (including, without limitation, all notices, certificates, affidavits,

purchase agreements, loan agreements, joint venture agreements, rights agreements and

other agreements, documents, certificates or instruments required or permitted to be given

or made under the temlS ofthe Preferred Stock and Warrants, the Credit Agreement

Amendment, the SLP Arrangement or the COO Arrangement), and to take any and all

actions, which such Authorized Officer may determine to be necessary, desirable or

appropriate in connection with the Preferred Stock and Warrants, the Credit Agreement

Amendment, the SLP Arrangement or the COO Arrangement and the transactions and

3
arrangements contemplated thereby, such approval to be conclusively evidenced by the

execution thereof by such Authorized Officer; Oi) to incur and payor cause to be paid all

fees, expenses and taxes, including without limitation, legal fees and expenses in

connection with the Preferred Stock and Warrants, the Credit Agreement Amendment, the

SLP Arrangement or the CDO Arrangement and the matters contemplated thereby; and (iii)

to file or cause to be filed with the appropriate local, state or federal and foreign

governmental agencies and bodies, if any, all documents, instruments or certificates as any

such Authorized Officer may deem to be necessary, desirable or appropriate, each ofwhich

shall be in such form and contain such tenns and provisions as such Authorized Officer, or

any ofthem, shall approve, such approval to be conclusively evidenced by the execution

thereof by such Authorized Officer; and

Ratification of Past Actions

FURTHER RESOLVED, that all actions heretofore taken by any person who is an

officer, director, employee or agent ofthe Corporation, including any notifications to

various governmental and regulatory authorities as well as the execution of all instruments,

certificates, agreements and other documents, the incurring or paying of expenses, fees and

other amounts and any other acts in furtherance of or in connection with any transactions

authorized by the foregoing resolutions, are hereby approved and ratified in all respects.

4
Annex A
The undersigned hereby confiml that they have reached an agreement in

principle consistent with the annexed term sheet for the purchase and sale ofthe

Senior Preferred Stock and Warrant.

UNITED STATES DEPARTMENT OF

THE TREASURY

By: _

Dated: November 9, 2008

(1')') 07S65jOO2lTER~SHEETiAIG.Lener.Agreemcnl.doc

AMER1CAN lNTERNAT10NAL

GROUP, INC.

By: _
TARP AIG SSFllnvestment

Senior Preferred Stock and Warrant

Summary of Senior Preferred Terms

Issuer:

Initial Holder:

Size:

Security:

Ranking:

Term:

Dividend:

Redemption:

Restrictions on

Dividends:

American International Group, Inc. ("AIG").

United States Department of the Treasury (the "USr).

$40 Billion aggregate liquidation preference.

Senior Preferred, liquidation preference $10,000 per share;

provided that UST may, upon transfer of the Senior Preferred,

require AIG to appoint a depositary to hold the Senior Preferred

and issue depositary receipts.

Senior to common stock and pari passu with existing preferred

shares other than preferred shares which by their terms rank

junior to the Senior Preferred. At the meeting of stockholders

called to effect the amendments to AIG's Restated Certificate of

Incorporation contemplated by the t.arms of the convertible

preferred stock, AIG shall propose an amendment to its Restated

Certificate of Incorporation to allow the Senior Preferred to rank

senior to the convertible preferred stock.

Perpetual tife.

The Senior Preferred will accrue cumulative dividends at a rate

of 10% per annum. Dividends will be payable quarterly in arrears

on February 1, May 1, August 1 and November 1 of each year.

Dividends will be payable when, as and if declared by the Board

of Directors of AIG. Accrued but unpaid dividends shall

compound quarterly.

At any time that (i) the AIG Credit Facility Trust (or any successor

entity established for the benefit of the United States Treasury)

"beneficially owns" less than 30% of the aggregate voting power

of AIG's voting securities and (ii) no holder of the Senior

Preferred controls AIG, then AIG may redeem the Senior

Preferred in whole or in part at a redemption price equal to 100%

of its liquidation preference, plus an amount equal to accrued

and unpaid dividends (including, if applicable, dividends on such

amount). "Control" for this purpose means the power to direct the

management and policies of AIG, directly or indirectly, whether

through the ownership of voting securities, by contract, by the

power to control AIG's Board of Directors or otherwise.

"Beneficially owns" is as defined in Rule 13d-3 under the

Securities Exchange Act of 1934. For the avoidance of doubt,

while there is AIG's Board of Directors control (or the potential to

gain AIG's Board of Directors control) by the holder of the Senior

Preferred, then AIG is not permitted to redeem the Senior

Preferred.

Subject to certain exceptions, for as long as any Senior Preferred

{NY) 078(,5i002/TERMSfIEET/AIG.Tenll.Sheet.doc
is outstanding, no dividends may be declared or paid on junior

preferred shares, preferred shares ranking pari passu with the

Senior Preferred ("Parity Stock"), or common shares (other than

(i) in the case of pari passu preferred shares, dividends on a pro

rata basis with the Senior Preferred and (ii) in the case of junior

preferred shares, dividends payable solely in common shares),

nor may AIG repurchase or redeem any junior preferred shares,

preferred shares ranking pari passu with the Senior Preferred or

common shares, unless all accrued and unpaid dividends for all

past dividend periods on the Senior Preferred are fUlly paid or

declared and a sum sufficient for the payment thereof set apart.

Common dividends: The UST's consent shall be required for any increase in common

dividends per share until the fifth anniversary of the date of this

investment unless prior to such fifth anniversary the Senior

Preferred is redeemed in whole or the UST has transferred all of

the Senior Preferred to third parties.

Repurchases: The UST's consent shall be required for repurchases of any

common shares, other capital stOCk, trust preferred securities or

other equity securities (other than (i) repurchases of the Senior

Preferred, (ii) repurchases of junior preferred shares or common

shares ("Junior Stock") in connection with the administration of

any employee benefit plan in the ordinary course of business and

consistent with past practice (including purchases to offset share

dilution pursuant to a publicly announced repurchase plan), (iii).

any redemption or repurchase of rights pursuant to any

stockholders' rights plan and (iv) the exchange or conversion of

Junior Stock for or into other Junior Stock or of 'Parity Stock or

trust preferred securities for or into other Parity Stock (with the

same or lesser aggregate liquidation amount) or Junior Stock, in

each case, solely to the extent required pursuant to binding

contractual agreements entered into prior to the signing date of

UST's agreement to purchase the Senior Preferred or any

subsequent agreement for the accelerated exercise, settlement

or exchange thereof for common stock), until the fifth anniversary

of the date of this investment unless prior to such fifth

anniversary the Senior Preferred is redeemed in whole 'Or the

UST has transferred all of the Senior Preferred to third parties.

Notwithstanding the foregoing, following the redemption in whole

of the Senior Preferred held by UST or the transfer by UST of all

of the Senior Preferred to one or more third parties not affiliated

with UST, AIG may repurchase, in whole or in part, at any time

the Warrant then held by UST at the fair market value of the

Warrant so long as no holder of the Warrant controls AIG as

provided in clause (ii) of "Redemption" above.

Voting rights: The Senior Preferred shall be non-voting, other than class voting

rights on (i) any authorization or issuance of shares other than

the convertible preferred stock ranking senior or pari passu to the

Senior Preferred, (ii) any amendment that adversely affects the

rights of Senior Preferred, or (iii) any merger, exchange or similar

transaction unless the Senior Preferred remains outstanding or is

converted into or exchanged for preference securities of the

surviving or resulting entity or its ultimate parent and the Senior

Preferred or such preference shares have such rights,

preferences, privileges and voting powers, and limitations and

restrictions thereof, taken as a whole, as are not materially less

2 INY) 07H65l002,TERMSHF.f.TIAIG.Term.Shccl.doc
Transferability:

Claim in

Bankruptcy:

Acceleration

Rights:

Use of Proceeds:

Tax Treatment:

Restrictions on

Expenses:

favorable to the holders thereof than those of the Senior

Preferred immediately prior to such transaction, taken as a

whole.

If dividends on the Senior Preferred are not paid in full for tour

dividend periods, whether or not <:onsecutive, the Senior

Preferred will have the right to elect the greater of 2 ·directors and

a number of directors (rounded upward) equal to 20% of the total

number of directors after giving effect to such election. The right

to elect directors will end when full dividends have been paid for

all past dividend periods.

The Senior Preferred will not be subject to any contractual

restrictions on transfer other than such as are necessary to

insure compliance with U.S. federal and state securities laws.

AIG will file a registration statement (which may be a shelf

registration statement) covering the Senior Preferred as promptly

as practicable, but in any event within 1"5 days, after notification

by the UST and, if necessary, shall take all action required to

cause such registration statement to be declared effective as

soon as possible. During any period that an effective registration

statement is not available for the resale by the UST of the Senior

Preferred, AIG will also grant to the UST piggyback registration

rights for the Senior Preferred and will take such other steps as

may be reasonably requested to facilitate the transfer of the

Senior Preferred including. if requested by the UST, using

reasonable best efforts to list the Senior Preferred on a national

securities exchange. If requested by the UST, AIG will appoint a

depositary to hold the Senior Preferred and issue depositary

receipts.

Equity claim with liquidation preference to common equity claim.

None

To repay the senior secured revolving credit facility governed by

the Credit Agreement dated as of September 22, 2008 (the

"Credit Agreement") between AIG and the Federal Reserve Bank

of New York ("FRBNY").

Dividends on the Senior Preferred are non tax-deductible to AIG.

AIG shall continue to maintain and implement its comprehensive

written policy on corporate expenses and distribute such policy to

all AIG employees. Such policy, as may be amended from time

to time, shall remain in effect at least until such time as any of

the shares of the Senior Preferred are owned by the UST. Any

material amendments to such policy shall re~uire the prior written

consent of the UST until such time as the UST no longer owns

any shares of Senior Preferred. and any material deviations from

such policy, whether in contravention thereof or pursuant to

waivers provided for thereunder, shall promptly be reported to

the UST. Such policy shall, at a minimum: {il require

compliance with all applicable law; {ii) apply to AlG and all of its

subsidiaries; (iii) govern {a) the hosting, sponsorship or other

3

{NY} 07S65;U02frERMSHEETiAIG.Tenn.Shoel.doc
Restrictions on

Lobbying:

Reporting:

Executive

Compensation:

payment for conferences and events, (ob) the use of corporate

aircraft, (c) travel accommodations and expenditures, (d)

consulting arrangements with outside service providers, (e) any

new lease or acquisition of real estate, (f) expenses relating to

office or facility renovations or relocations and (9) expenses

relating to entertainment or holiday parties; and (iv) provide for

(a) internal reporting and ov-ersight and (b) mechanisms for

addressing non-compliance with the policy.

AIG shall continue to maintain and implement its comprehensive

written policy on lobbying, governmental ethics and political

activity and distribute such policy to all AIG employees and

lobbying firms involved in any such activity. Such policy, as may

be amended from time to time, shall remain in effect at least until

such time as any of the shares of the Senior Preferred are

owned by the UST. Any material amendments to such policy

shall require the prior written consent of the UST until such time

as the UST no longer owns any shares of Senior Preferred, and

any material deviations from such policy, whether in

contravention thereof or pursuant to waivers provided for

thereunder, shall promptly be reported to the UST. Such policy

shall, at a minimum: (i) require compliance with all applicable

law; (ii) apply to AIG and all of its subsidiaries and affiliated

foundations: (iii) govern {a) the provision of items of value to any

government officials, (b) lobbying and (c) political activities and

contributions; and (iv) provide for (a) internal reporting and

oversight and (b) mechanisms for addressing non-compliance

with the policy.

Except as otherwise agreed, AIG shall provide the UST (i) the

information requir-ed to b~ provided by AIG to the FRBNY

pursuant to Section 5.04 of the Credit Agreement, (ii) the notices

required by Section 5.05 of the Credit Agreement, in each case

within the time periods for delivery thereof specified in the Credit

Agreement and (iii) such executive compensation information as

is required for purposes of the Emergency Economic

Stabilization Act of 2008 ("EESA") and the regulations and

guidelines thereunder; provided that, after the termination of the

Credit Agreement, such informational and notice requir-ements as

are provided in Section 5.04 and Section 5.05 of the Credit

Agreement shall remain in full force and effect until such time as

the UST no longer owns any shares of Senior Preferred. In

addition, AIG shall promptly provide the UST such other

information and notices as the UST may reasonably request from

time to time.

As a condition to the closing of this investment, AIG shall be

subject to the executive compensation and corporate

governance requirements of Section 111(b) of the EESA and the

UST's guidelines that carry out the provisions of such subsection

for systemically significant failing institutions as set forth in Notice

2008-PSSFI. Accordingly, as a condition to the closing of this

investment, AIG and its senior executive officers covered by the

EESA ("SEOs") shall modify or terminate all benefit plans,

arrangements and agreements (including golden parachute

agreements) to the extent neces~ary to be in compliance with,

4

(NY) 0786)iOO~ITF.RMSHE£T !A1G .:r~rm .Sheel.doc
Risk Management

Committee:

Miscellaneous:

and f9110wing the closing and for so long as the UST holds any

equity or debt securities of AIG issue{j under this agreement (the

"Relevant Period"), AIG shall agree to be bound by the executive

compensation and corporate governance requirements of

Section 111 (b) of the EESA and the guidelines set forth in Notice

2008-PSSFI. As an additional con{jition to the closing, AIG and

its SEOs shall grant to the UST and the SEOs shall grant to AIG

waivers releasing the UST, and, in the case of the SEOs relea-se,

AIG, from any claims that AIG and such SEOs may otherwise

have as a result of any modification of the terms of any benefit

plans, arrangements and agreements to eliminate any provisions

that would not be in compliance with the executive compensation

and corporate governance requirements of Section 111 of the

EESA and the guidelines set forth in Notice 2008-PSSFI.

In addition to Notice 2008-PSSFI, the following will apply:

1. AIG shall undertake during the Relevant Period ·to

limit any golden parachute payments to its most senior employee

group. who are currently referred to as Senior Partners ("Senior

Partners"), (other than its SEOs) to the amounts permitted by the

regulations relating to participants in the EESA Capital Purchase

Program and the guidelines and Interim Final Rule (31 eFR Part

30) relating thereto as if they were SEOs (except that equity

denominated awards settled solely in equity shall not be included

in such limitl, and AIG shall grant the UST a waiver releasing the

UST, and shall use its best efforts to obtain waivers from the

Senior Partners releasing the UST and AIG, from claims that AIG

may have against the UST and that such Senior Partners may

have against the UST or AIG as a result of such limits, and shall

have obtained such waivers from AIG and its U.S.-based Senior

Partners prior to and as an additional condition to the closing.

2. The annual bonus pools payable to Senior Partners

in respect of each of 2008 and 2009 shall not exceed the

average of the annual bonus pools paid to Senior Partners for

2006 and 2007 (in each case exclusive of AIG's historic quarterly

bonus program, the amount of which will not increase for any

participant, and subject to appropriate adjustment for new hires

and departures).

AIG shall establish, within 30 days of the issuance of the Senior

Preferred, and maintain, at least until the UST ceases to own any

shares of the Senior Preferred, the Warrant or any other equity

or debt securities of AIG, a risk management committee of the

AIG's Board of Directors that will oversee the major risks

involved in AIG's business operations and review AIG's actions

to mitigate and manage those risks.

The dividend rate as provided in "Dividend" above is subject-to

adjustment in the sole discretion of the Secretary of the Treasury

in light of, inter alia, then-prevailing economic conditions and the

financial condition of AIG, with the objective of protecting the

U.S. taxpayer.

5

iNY1<:i7S(,S/002lTERMSHEETIAIGTc,m.Sheel.doc
Warrant:

Term:

Exercisability:

Transferability:

Voting:

Substitution:

Summary of Warrant Terms

The UST will receive a warrant ("Warrant") to purchase a number

of shares of common stock of AIG ("Common Stock") equal to

2% of the issued and outstanding shares of Common Stock on

the date of investment. The initial exercise price for the Warrant

shall be $2.50 per share ofCommon Stock (representing the par

value of the Common Stock on the date of the investment),

subject to customary anti-dilution adjustments; provided that the

initial exercise price per share of Common Stock shall be

adjusted to the par value per share of the Common Stock

following the amendments to AIG's Restated Certificate of

Incorporation contemplated by the terms of the convertible

preferred stock. The Warrant shall be net share settled or, if

consented to by AIG and the UST, on a full physical basis.

10 years

Immediately exercisable, in whole or in part.

The Warrant will not be subject to any contractual restrictions on

transfer other than such as are necessary to ensure compliance

with U.S. federal and state securities laws. AIG will file a

registration statement (which may 'be a shelf registration

statement) covering the Warrant and the Common Stock

underlying the Warrant as promptly as practicable, but in any

event within 15 days after notification by the UST, and, if

necessary, shall take all action required to cause such

registration statement to be declared effective as soon as

possible. During any period that an effective registration

statement is not available for the resale by the UST of the

Warrant or the Common Stock underlying the Warrant, AIG will

also grant to the UST piggyback registration rights for the

Warrant and the Common Stock underlying the Warrant. AIG will

apply for the listing on the New York Stock Exchange of the

Common Stock underlying the Warrant and will take such other

steps as may be reasonably requested to facilitate the transfer of

the Warrant and the underlying Common Stock.

The UST will agree not to exercise voting power with respect to

any shares of Common Stock issued to it upon exercise of the

Warrant.

In the event AIG is no longer listed or traded on a national

securities exchange the Warrant will be exchangeable (in whole

or in part), at the option of the UST, for an economic interest (to

be determined by the UST after consultation with AIG) of AIG

classified as permanent equity under GAAP having a fair market

value (as determined by the UST) equal to the portion of the

Warrant so exchanged.

6

•

lNY) (I7R~5!002!T[RMSHEETIJ\IG.Term.sheel.doc
Annex B
DPW DRA.FT) )/612008

AMENDMENT NO.2 TO CREDIT AGREEMENT

AMENDMENT dated as of November U, 2008 to the Credit Agreement

dated as of September 22,2008 (as amended from time to time, the "Credit

Agreement") between AMERICAN INTERNATIONAL GROUP, INC., as

Borrower (the "Borrower") and FEDERAL RESERVE BANK OF NEW YORK,

as Lender (the "Lender").

PRELIMINARY STATEMENTS

(1) WHEREAS, Borrower intends to issue 2008 Preferred Stock (as

defined below) having an aggregate liquidation preference of $40 billion.

(2) WHEREAS, Borrower has requested Lender to amend the Credit

Agreement in cOlU1ection with such issuance and to make certain other changes as

described herein, and Lender has agreed, subject to the terms and conditions

hereinafter set forth, to amend the Credit Agreement to effect such changes as set

forth below.

NOW, THEREFORE, in consideration ofthe mutual covenants and

agreements set forth herein and for other good and valuable consideration, the

sufficiency and receipt of which is hereby acknowledged, the parties hereto

hereby agree as follows:

SECTION 1. Defined Terms; References. Unless otherwise specifically

defined herein, each term used herein that is defined in the Credit Agreement has

the meaning assigned to such term in the Credit Agreement. Each reference to

"this Agreeme.nt", "hereof', "hereunder", "herein" and "hereby" and each other

similar reference in the Credit Agreement, and each reference in any other Loan

Document to "the Credit Agreement", "thereof', "thereunder", "therein" or

"thereby" or other similar reference to the Credit Agreement, shall, aft·er the

Amendment No.2 Effective Date (as defined in Section 9 ofthis Amendment),

refer to the Credit Agreement as anlended hereby.

SECTION 2. Amendments to Definitions. Section 1.01 ofthe Credit

Agreement is amended by adding or amending (as applicable) the following

definitions to read in their entirety as follows:

""2008 Preferred Stock" shall mean the Series D Preferred Stock

ofthe Borrower, par value $5.00 per share, issued to the United

States Department ofthe Treasury.

(NY) 27961!208/NEW.BRIDG£!CREDlT.AGREEMENT.AMENDMENTS!AMENDMa.'T.NO.l/Amend.l.doc 11103/085:24 PM
"2008 Wa~rants" shall mean warrants issued by the Borrower to

the United States Department of the Treasury concurrently with the

issuance ofthe 2008 Preferred Stock.

"Applicable Margin" shall mean 3.00% per annum.

"Maturity Date" shall mean September 13,2013.

"Subject Issuer" shall mean any Person that is a Subject Issuer as

defined in the Guarantee and Pledge Agreement, excluding any

Person whose Equity lnterests are not (and are not required to be)

subject to any Lien in favor ofthe Lender pursuant to the

Guarantee and Pledge Agreement."

SECTION 3. Amendment TO Available Commitment Fee. 'Section 2.05(a)

of the Credit Agreement is hereby amended by replacing the reference to "8.50%"

therein with "0.75%".

SECTION 4. Commitment Reduction. Section 2.1 O(h) ofthe Credit

Agreement is hereby amended to read in its entirety as follows:

"(h) Simultaneously with any prepayment required by

paragraph (b), (c) or (d) ofthis Section 2.10, the Commitment shall

be automatically and permanently reduced (i) in the case of any

prepayment from the Net Cash Proceeds ofthe issuance of2008

Preferred Stock and the 2008 Warrants, to $60,000,000,000 and

(ii) otherwise, in an amount equal to that portion of the Net Cash

Proceeds required to be applied to prepay the Original Principal

Amount ofthe Loans pursuant to such paragraphs."

SECTION 5. Amendments to Certain Covenants. The proviso to Section

6.06(a) of the Credit Agreement is hereby amended by replacing "and" where it

appears at the end of clause (i) thereof with a semicolon and adding the following

new clause (iii) after clause (ii) thereof:

"and (iii) so long as no Default shall have occurred and be

continuing or would result therefrom, the Borrower may make

payments of cumulative compounding dividends on its 2008

Preferred Stock at a rate not to exceed 10% per annum"

SECTION 6. Amendments to Exhibit D. Exhibit D ofthe Credit

Agreement is hereby amended 10 read in its entirety as set forth on Exhibit A

hereto.

SECTION 7. Certain Technical Amendments. (a) Clause (E) of the

proviso to Section 6.06(b) is hereby amended to read in its entirety as follows

2

(NY) 279611208lNEW.BRllXiEiCREDlT.AGREEM£NT.AMENDMENTSlAMENDMENT.NO. IlAm.nd.) .doc IlI03108 5:24 PM
"(E) clause (i) of the foregoing shall not apply to restrictions or

conditions imposed by any agreement relating to se.cured

Indebtedness or secured Swap Contracts pemlitted by this

Agreement ifsuch restrictions or conditions apply only to the

property or assets securing such Indebtedness or such Swap

Contracts, as the case may be".

(b) Schedule 8.01 ofthe Credit Agreement is hereby amended by

replacing the entry requiring that notices be copied to Joy-ce M. Hansen with the

following new entry:

Federal Reserve Bank of New York

33 Liberty Street New York, New York 10045

Attention: James R. Hennessy, Counsel and Vice President

Telecopy: (212) 720-7797

Telephone: (212) 720-5024

E-mail: james.hennessyuv.nyJrb.org

SECTION 8. Representations ofBorrower. The Borrower represents and

warrants on the Amendment No.2 Effective Date that (i) the representations and

warranties of Borrower contained in Article 3 ofthe Credit Agreement and by any

Loan Party in any other Loan Document shall be true and correct on and as ofthe

Amendment No.2 Effective Date, except to the extent that such representations

and warranties specifically refer to an earlier date, in which case they shall be true

and correct as ofsuch earlier date; and (ii) no Default or Event of Default shall

exist on the Amendment No.2 Effective Date after giving effect to this

Amendment

SECTION 9. Condilions to Effectiveness. This Amendment shall

become effective on the date (the "Amendment No.2 Effective Date'') when,

and only when, each ofthe following conditions shall have been satisfied ·to the

satisfaction of Lender:

(a) Execution of Counterparts. Lender shall have received from

Borrower a counterpart hereofsigned by Borrower.

(b) Execution of Consent. Lender shall have received counterparts of a

consent substantially in the form of Exhibit B to this Amendment, duly executed

by each Guarantor.

(c) Expenses. Lender shall have received reimbursement for all costs

and expenses (including fees, charges and disbursements of counsel to Lender) to

the extent required by Section 8.05(a) ofthe Credit Agreement, including in

connection with the preparation, negotiation and execution ofthis Amendment.

(d) Consummation of 2008 Preferred Stock Issuance. Borrower shaH

have consummated the issuance of 2008 Preferred Stock having a liquidation

3

(NY) 279l>1:'2(l8/NEW.BRIDGEiCREDIT....GREEMENT.AMENDMENTSIAMENDMENT.NO.1/Amend.l.doc lIill3IQS 5:24 PM
·preference of nOlless than $40,000,000,000 on or prior to the Amendment No.2

Effective Date.

SECTJON ] O. Certain Consequences OfE.ffectiveness. On and after the

Amendment No.2 Effective Date, the rights and obligations ofthe parties hereto

shall be governed by the Credit Agreement as amended by this Amendment;

provided that the rights and obligations ofthe parties to the Credit Agreement

with respect to the period prior to the Amendment No.2 Effective Date shall

continue to be governed by the provisions ofthe Credit Agreement prior to giving

effect to this Amendment. Each Loan Document, as 'speci1ically amended hereby,

is, and shall continue to be, in full force and effect and is hereby ratified and

confinned in all respects. Without limiting the foregoing, the Security

Documents and all ofthe Collateral do and shall continue to secure the payment

of all obligati ons under the Loan Documents as amended hereby.

SECT10N 11. Governing Law. This Amendment shall be governed by,

and constnled in accordance with, the laws ofthe State of New York.

SECTJON 12. Counterparts. This Amendment may be signed in any

number of counterparts, each of which shall be an original, with the same effect as

ifthe signatures thereto and hereto were upon the same instrument. Delivery by

telecopier of an executed counterpart of a signature page to this Amendment shall

be effective as delivery of an original executed counterpart of this Amendment.

4

(NY) 2796Ii208iNEW.DRIDGEiCREDIT.AGREEMENT.AMENDMENTS/AMENDMENT.NO.liAmend.l.oo< J 1103108 5:24 PM
IN WITNESS WHEREOF, the parties hereto have caused this

Amendment to be duly executed as ofthe date first above written.

AMERICAN INTERNATIONAL

GROUP, INC., as Borrower

By:

Name:

Title:

•

(NY) 279611208/NEW.BRlDGE/CREDIT.AGREEMENT.AMENDMENTSiAMENDMENT.1'10.11Amend.l.doc 1II03i08 5:24 PM
FEDERAL RESERVE BANK OF NEW

YORK, as Lender

By:

Name:

Title:

(NY) 27961f208INEW.BR1DGEfCREDlT.A'GR£EMENT.AMENDMENTSIAMENDMENTNO.IIAn'end.l.doc 11103/08 5:24 PM
EXHlB1T A

(NY) 27961 120SiNEW.BR1DGE!CREDlT.AGREEMENT.AMENDMENTS!AMENDMENT.NO.lIAmend.l.doc 11i03ill8 5:24 I'M
EXHIBITD

SummarY of Terms of Preferred Stock and Related Issues

Issuer

Purchaser

Sel'urities

Consitle.-ation

Voting rights

Dividends

Connl'sion

Anti-Dilution

Pro,'isions

Tc,-m

Liq uida tion

preference

American International Group, Inc. ("AIG").

AIG Credit Facility Trust, a new trust established for the benefit ofthe United States

Treasury ("Trust").

100,000 shares of Series C Perpetual, Convertible, PaJ1icipating Preferred Stock, par

value $5.00 per share ("Preferred Stock").

$500,000 plus the lending commitment ofthe Federal Reserve Bank of New York

("NY Fed"); AJG's board will acknowledge the receipt of value at least equal to the

aggregate par value oftile shares of Preferred Stock in connection with their issuance.

Except where a class vote is required by law, the Preferred Stock will vote with the

common stock on all matters submitted to AIG's stockholders, and will be entitled to

an aggregate number of votes equal to (i) the Initial Number of Shares (as defined

below), as adjusted pursuant to the anti-dilution provisions, minus (ii) the votes, if

any, attributable to shares of common stock previously issued on any partial

conversion of the Preferred Stock; provided that the number of votes anributable to tIle.

Preferred Stock shall not exceed 77.9% of the aggregate number of votes of the

Preferred Stock and the shares of common stock then outstanding.

The Preferred Stock will be entitled to participate in any dividends paid on the

common stock, and shall receive (i) the dividends attributable to the Initial Number of

Shares, as adjusted pursuant to the anti-dilution provisions, minus Oi) the dividends, if

any, paid with respect to shares of common stock previously issued on any partial

conversion ofthe Preferred Stock; provided that the dividends attributable to the

Preferred Stock shall not exceed 77.9% ofthe aggregate amount of dividends paid on

the Preferred Stock and the shares of common stock then outstanding.

Upon the e·ffectiveness ofthe amendment to AIG's restated -certificate ofincorporation

described in clause (i) under "Stockholder vote," the Preferred Stock will be

convertible into a number ofshares of common stock (the "Initial Number of Shares")

equal to the exc·ess of(a) the product of 3.9751244 times the Number of Outstanding

Shares over (b) 53,798,766 (the number ofshares of common stock underlying the

2008 Warrants). The "Number of Outstanding Shares" means, as of any date, the

num ber ofshares of common stock outstanding as of the date of issuance ofthe

Preferred Stock plus the number ofshares of common stock, if any, issued on or prior

to such date in settlement of AIG's Equity Units.

The Preferred Stock will have customary anti-dilution provisions.

Perpetual.

$500,000 in aggregate.

(NY){)7R65!002!TAR!'/Exhibil.D."mSI.l:~uil)·.lnl ..esl.doc
Stockholder- vote

Eq \I it)' issues

Governance

Rl'gistration rights

Regulation

AIG's board will call a meeting ofstockholders as soon as practicable after the

issuance of the Preferred Stock. At that meeting, the stockholders, with the common

stockholders voting as a separate class in the case ofthe matters in clause (i), will vote

on, among other things, (i) amendments to A1G's certificate of incorporation to (a)

reduce the par value of AIG's <:ommon stock to $0.000001 per share and {b) increase

the number of authorized shares of common stock to 19 billion and (ii) any other

measures deemed by the NY Fed to be ne<:essary for the conversion ofthe PrefelTed

Stock or the operation of the Facility, including the pledging ofcollateral thereunder.

So long as the Trust's equity ownership, determined as the sum of its ownership of

common stock and the number of shares of common stock underlying the Preferred

Stock (whether or not the Preferred Stock is then convertible), shall equal or exceed

50% of the Initial Number of Shares (as adjusted pursuant to the anti-dilution

provisions), AIG shall not issue any capital stock, or any or securities or instruments

c.onvertible or exchangeable into, or exercisaMe for,capita! stOCk, without the written

consent of the Trust other than (i)(x) issues ofcapital stock to satisfy any security or

instrument existing on September 16,2008 that is exercisable for, convertible into or

exchangeable for common stock, (y) in respect of equity compensation awards issued

in the ordinary course of business under AIG's Amended and Restated 2007 Stoc.k

Incentive Plan or AIG's Amende·d and Restated 2002 Stock Incentive Plan or (z) in

respect of any tax-qualified plan approved in the ordinary course of business by the

Board of Directors of AIG that meets the requirements of Section 423 ofthe Internal

Revenue Code and (ii) subsequent to written notice from the Trust that AIG's

corporate governance anangements are satisfactory to the trustees(x) in respect of

equity compensation awards issued under any equity compensation plan (including

any material amendments thereto) approved by shareholders after September 16,2008

in accordance with the shareholder approval requirements of the NYSE Listed

Company Manual or (y) in anyone year, up to 0.5% ofthe outstanding shares of

common stock pursuant to any other e.mployee. benefit plan, employment contract or

similar arrangement that is approved by the Compensation and Management

Resources Committee of the Board of Directors of AIG.

AIG and its board will work in good faith with the trustees ofthe Trust to ensure

corporate governance aITangements satisfactory to the trustees.

AIG will enter into a customary agreement providing for demand registration rights for

the Preferred Stock and the underlying common stock, will apply for the listing on the

NYSE ofthe common stock underlyin.g the Prefen"ed Stock, and will take such other

steps as the NY Fed may reasonably request to facilitate the transfer ofthe Preferred

Stock or common stock received on conversion ofthe Preferred Stock.

AIG will take all actions necessary or expedient for obtaining any regulatory

approvals, notices, waivers or consents related to the issuance and acquisition ofthe

Preferred Stock and will assist the NY Fed in such matters.

2

(NY) 07Ho5ioo2trARl'lbhibil.l).T..lIsI.Equ;ly.hll....sl.doc
NYSE

Takeover laws

AIG will take allllctions necessary or expedient for obtaining NYSE approval for the

issuance and voting ofthe Preferred Stock, including actions required ofthe audit

committee ofthe board ofAIG to take advantage ofthe exemption from the NYSE's

stockholder approval requirements set forth in Section 312.05 of the NYSE Listed

Company Manual.

AIG will take all actions necessary or expedient in order to exempt the acquisition and

ownership oftJle Preferred Stock and any common stock issued upon conversion ofthe

Preferred Stock from (i) the requirements of any applicable "moratorium", "control

share", "fair price" or other anti-takeover laws and regu{ations of any jurisdiction,

including Section 203 ofthe Delaware General Corporation Law, and (ji) any other

applicable provision ofthe organiz.ational documents of AIG or the comparable

organizational documents of any subsidiary of AIG.

..,

J

(r-;y) 07S65/002/TARPIExhibi,.D.Trus,.Equily.ln:ero,1.doc
EXHIBlTB

Reference is made to Amendment No.2 dated November LJ, 2008

between American International Group, Inc., as Borrower (the "Borrower") and

Federal Reserve Bank ofNew York, as Lender (the "Lender") (the

"Amendment"). Unless otherwise specifically defined herein, each term used

herein that is defined in the Amendment shall have the meaning assigned to such

term in the Amendment.

Each ofthe undersigned hereby consents to the Amendment and hereby

confirms and agrees that (a) notwithstanding the effectiveness ofthe Amendment,

each Loan Document to which it is party is, and shall continue to be, in full force

and effect and is hereby ratified and confirmed in all respects, except that, on and

after the effectiveness of the Amendment, each r.eference in the Loan Documents

to the "Credit Agreement", "thereof', "thereunder", "therein" or "thereby" or

similar references to the Credit Agreement shall mean and be a reference to the

Credit Agreement as amended by the Amendment and {b) the Loan Documents to

which each of the undersigned is a party and all ofthe Collateral described therein

do, and shall continue to, secure the payment of all obligations under the Loan

Documents, as amended hereby.

[GUARANTORS]

By:

Name:

Title:

(NY) 2796112081NF.W.RRIDGFJCR EDIT.AGREEMENT.AMENDMENTS!AMENDMl:'NT.NO.IJAmend.).doc 1)/03;08 5:24 PM
Annex C
MAlDEN LANE II

Tem1 Sheet

November [ ], 2008

Set forth below is a summary of proposed tenns relating to the Maiden

Lane II structure, under which (i) Maiden Lane II LLC ("ML II"), a Delaware

limited liability company, will purchase a certain pool ofRMHS (the "RMBS

Assets") from each ofseveral AIG subsidiaries currently holding such RMBS

Assets (each a "Seller") in exchange for an interest in the Senior Loan and the

Subordinated Loan pro rata to such 'Seller's share of the aggregate RMBS Assets,

(ii) Federal Reserve Bank ofNew York ("FRBNY") will purchase all ofthe

Sellers' interests in the Senior Loan from the Sellers and (iii) American

International Group, Inc. ("AIG") will purchase all ofthe "Sellers' interests in the

Subordinated Loan fTOm the Sellers.

I. PARTIES

Sellers:

Borrower and Purchaser:

Senior Lender and

Controlling Party:

Subordinated Lender:

Portfolio Manager:

Collateral Agent:

LLC Administrator:

II. ASSET PURCHASE

AGREEMENT

AIG Subsidiaries listed in Schedule A hereto

MLII

Federal Reserve Bank ofNew York ("FRBNY")

American International Group, Inc. ("AIG")

[to be detennined]

[to be detem1ined]

[to be determined]

Asset Purchase Agreement: ML Jl shall, subject to satisfaction ofthe conditions

precedent, purchase on the Closing Date the RMBS

Pool from each Seller without recourse (other than for

breach ofrepresentations and warranties) in exchange

for a pro rata interest in the Senior Loan and the

Subordinated Loan.

(NY) 078b5i002/MI•. ll/lermshecl.mI.1I.dot 11 !05108 8:33 PM
RMBS Assets:

Purchase Price:

Certain documentary

matters:

III. LOAN FACILITY

Senior Loan:

Senior Interest Rate:

Subordinated Loan:

Subordinated Interest Rate:

Senior and Subordinated

Loan BOlTowings:

Subordination:

(NY) 078b51002IMLililermsheel.ml.ll.doc

Collectively, the RMBS issues listed in Schedule A

hereto for each Seller and rights to the outstanding

principal thereof and a<:crued imerest thereon as of

October 31,2008 (for each Seller, an "Indicath'

e

RMBS Pool") less the dispositions thereof and the

collections of principal and interest thereon plus

accrued interest thereon between October 3] and the

Closing Date.

Determined for each Indicative RMBS Pool as of

October 3], 2008 (the "Determination Date") and

adjusted on the Closing Date by subtracting the

estimated amount of dispositions and collections since

the Determination Date, and subject to further

adjustment when final info1l11ation thereon is

available.

Representations, warranties, affinnative and negative

covenants to be determined.

New York governing law.

TeJl11loan equal to the Purchase Price ofRMBS less

$] billion.

[LlBOR+ I00]

Term loan eqllal to $] billion.

[LlBOR+300]

A borrowing in the amount equal to the Purchase Price

will be made on the Closing Date.

Borrowings will be made from time to time soon after

the Closing Date to fund increases in the Purchase

Price resulting from adjustments to the Purchase Price

made in accordance \vith the Asset Purchase

Agreement.

Obligations to pay principal and interest under the

Subordinated Loan shall be contractually subordinated

to the obligations to pay principal and interest under

the Senior Loan in accordance with the priority set

2 11/05/088:33 PM
Repayment:

Contingent Interest on

Loans:

Maturity:

Waterfall:

(NY) 07865/002iML.lli.crmshect.ml.1I.doc:

forth in the waterfall provisions.

Principal of Senior Loan is repaid in accordance with

the waterfall provisions and daily sweep mechanics for

the Collateral Account (as defined below). Interest on

the Senior Loan is capitalized [each quarter] until the

principal ofthe Senior Loan is repaid in full.

Principal of Subordinated Loan is repaid in accordance

with the waterfall provisions and daily sweep

mechanics for the Collateral Account, commencing

after all principal of, and interest on, the Senior Loan

has been repaid in full. Interest on the Subordinated

Loan is capitalized [each quaJ1er] until the prim::ipal of,

and interest on, the Senior Loan (and the principal of

the Subordinated Loan] is repaid in full.

After all principal of, and interest on, both the Senior

Loan and Subordinated Loan are repaid in full,

remaining cash receipts of ML 1I are paid 5/6 to the

Senior Lender and 1/6 to the Subordinated Lender, in

each case as contingent interest on the Loans

("Contingent Interest"). Right to Contingent Interest

cannot be transferred except together with related

Loan to same transferee.

The Senior Loan and Subordinated Loan shall mature

on the fifth anniversary of the Closing Date, subject to

extension at any time and from time to time by the

FRBNY in its sole discretion: prOVided that the

maturity of the Subordinated Loan may not be

extended beyond the maturity ofthe Senior Loan and

neither can be extended beyond the LJ month

following the stated maturity ofthe related loan.

First, costs and expenses (including fees and

indemnities) ofthe Senior Lender, the Controlling

Party, the Collateral Agent, the LLC Administrator,

the Portfolio Manager, their advisors (including Ernst

& Young, Blackrock and Morgan Stanley) and their

counsel (including Davis Polk and local cotmsel) then

due;

Second, cash reserve until the balance thereof is

$L-J(for payment of any expenses that be-come-due

3

11105108 8:33 PM
Collateral:

(NY) 0,865"-'02/ML.Jl/tcrmshee<.ml.1l.doc

on a day when there are insufficient collections to pay

them in full);

Third, principal ofthe 'Senior Loan;

Fourth, accrued and unpaid interest on the Senior

Loan (other than Contingent Interest);

Fifth, principal of the Subordinated Loan;

SiXTh, accrued and unpaid interest on the Subordinated

Loan (other than Contingent Interest);

Seventh, 5/6 ofthe remaining amount to Contingent

Interest on the Senior Loan and 1/6 of the remaining

amount to Contingent Interest on the Subordinated

Loan

The obligations ofthe Borrower in respect ofthe

Senior Loan and Subordinated Lean shall be secured

by a first priority perfected security interest in all the

RMBS Assets, the securities account ofthe Borrower

and all sub-accounts established thereunder (the

"Collateral Account") where all the RMBS Assets

shall be held, all other financial assets held therein

(including cash), all securities entitlements in respect

ofthe Collateral Account, and all the rights ofML II

under the Asset Purchase Agreement (collectively, the

"Collateral"). All RMBS Assets and all collections

on the RMBS Assets shall be held in the Collateral

Account. The Collateral Agent shall have full control

over the Collateral Account.

Any amounts of cash in excess of$[500,000] cash

reserve to be held in the Collateral Account shall be

swept on a daily basis and applied to repay the "Senior

Loan and Subordinated Loan in accordance with the

waterfall. Under the waterfall provision, any proceeds

from the Collateral shall be applied to principal of, and

interest on, the Senior Loan before they are applied to

principal of, or interest on, the Subordinated Loan.

The Collateral will be managed pursuant to the

Collateral Management Agreement.

4

11105/08 8:33 PM
lV.

Use of Proceeds:

CERTA1N

DOCUMENTARY

MATTERS

Representations and

Warranties:

Affirmative Covenants:

Negative Covenants:

Liquidation Events

(NY) 0786S/002/ML.1I/termsheel.mI.JJ.doc

To pay the Purchase Price ofthe RMBS Assets.

The Loan Documents shall c.ontain representations,

warranties, covenants and liquidation events deemed

appropriate by the Controlling Party, including,

without limitation:

Corporate existence; compliance with law; corporate

power and authority; enforceability of Loan

Documents; no conflict with law or contractual

obligations; no litigation; no default; no liquidation

event; Borrower's activities; taxes; Federal R-eserve

regulations; ERlSA; Investment Company Act;

subsidiaries; use of proceeds; accuracy of disclosure.

Delivery of financial statements, reports, accountants'

letters, officers' certificates and other information

requested by the Controlling Party; payment of other

obligations; maintenance of existence and material

rights and privileges; compliance with laws and

material contractual obligations; maintenance of books

and records; right of the [Portfolio Manager] to inspect

property and books and records; notices ofdefaults,

liquidation events, litigation and other material events;

collections on RMBS Assets; third party contracts.

Limitations on: indebtedness; liens; guarantee

obligations; mergers, consolidations, liquidations and

dissolutions; sales of assets; leases; dividends and

other payments in respect of capital stock;

expenditures; investments, loans and advances;

amendments to agreements; formation of subsidiaries;

limitation on activities; ERISA; limitation on accounts.

Material inaccuracy ofrepresentations and warranties;

violation of covenants [(subject to a grace period to be

agreed upon)]; loss oflien perfection or priority or

unenforceability ofthe security interest; bankruptcy

events; certain ERISA events.

Upon the occurrence of a Liquidation Event, the

Controlling Party may, in its sole discretion, liquidate

ML 11 and distribute its assets.

5 .J 1/05/08 8:33 I'M
Voting and Control:

Amendments:

Assignments

Expenses and

Jndemnification:

(NY) 078b5!002/ML.1I/tcrmshccl.ml.1I.doc

FRBNY shall at all times for so long as the Senior

Loan is outstanding be the Controlling Party that is

permitted to make all decisions regarding the

Collateral (including the ability to instruct ColJateral

Agent), any payments on any subordinated debt and

the timing and amount of any distributions.

The terms and ·conditions ofthe Senior Loan and the

Subordinated Loan may not be amended, varied or

waived absent the express written consent of a

majority ofthe Senior Lenders; provided that any

amendments to the Subordinated Loan also require -the

express written consent of a majority ofthe

Subordinated Lenders; and provided, furrher, that the

consent ofthe Controlling Party will be required for

certain fundamental amendments.

No Lender may assign or otherwise transfer (including

through participations) its rights or obligations under

the Credit Agreement, except that (i) the Sellers will

transfer their interests in the Senior Loan and

Subordinated Loan to FRBNY and AIG, respectively,

on the Closing Date and (ii) the S-enior Lender may

make transfers with the consent of the Controlling

Party.

The BOlTower shall pay in accordance with the

waterfall all fees and expenses ofthe Senior Lender,

the Controlling Party, the Collateral Agent, the LLC

Administrator, the Portfolio Manager, their advisors

and accountants (including Ernst & Young, BlackRock

and Morgan Stanley) and counsel {including Davis

Polk and any local counsel) incolUlection with the

trartsaction contemplated hereby.

The Controlling Party, the Lenders, the Collateral

Agent, the LLC Administrator and the Portfolio

Manager (and their affiliates and their respective

officers, directors, employees, advisors and agents)

will have no liability for, artd will be indemnified and

held harn1less against, any loss, liability, cost or

expense incurred in respect ofthe transactions

contemplated hereby {except to the extent resulting

from the gross negligence or willful misconduct ofthe

6

111051088:33 PM
indemnified party).

Governing Law and State ofNew York

Forum:

Counsel to Senior Lender Davis Polk & Wardwell

and the Controlling Party:

Counsel to Subordinated Sullivan & Cromwell LLP

Lender:

V. PROPOSED

COLLATERAL

ADMINISTRATION

PROVISIONS

Collateral Management:

Disposal Criteria:

[CoHateral Valuation

VI. ML 11

LLC Agreement

Management:

Capital Contributions:

(NY) 07Sb5l002IMUlf'e,msheel.R1I.I1.do<

On any Business Day, the Portfolio Manager may

dispose of any issue of RMBS ifthe disposal criteria

set forth in the Portfolio Management Agreement have

been met. Any proceeds from such disposal will be

applied in accordance with the waterfall provisions.

[Maximizing the repayment ofthe principal and

interest on the Senior Loan.]

The Portfolio Manager shall calculate and notify the

Lenders ofthe value ofthe Collateral on a monthly

basis.)

FRBNY and AIG as members with FRBNY having

the sole and exclusive control and management rights.

Delaware LLC Agreement.

Day to day management ofRMBS Assets to be

handled by Collateral Agent. Normal Delaware LLC

services to be provided by LLC Administrator.

The loans constitute LLC interests for tax and

accounting purposes.

7

11105/083:33 PM
SCHEDULE A

to

ML IJ Termsheet

[American General Life Insurance Company]

[list ofRMBS Issues in RMBS P.ool to come]

[American General Life and Accident Insurance Company]

[list of RMBS Issues in RMBS .pool to "Come]

[The United States Life Insurance Company in the City of New York]

[list ofRMBS Issues in RMBS Pool to come]

[American General Assurance Compan)']

[list ofRMBS Issues in RMBS Pool to come]

[AIG Life Jnsurance Company]

[list ofRMBS Issues in RMBS Pool to come]

[American International Life Assurance Company of New York]

[list ofRMBS Issues in RMBS Pool to come]

[Delaware American Life Insurance Company]

[list ofRMBS Issues in RMBS Pool to come]

[AIG Annuity Insurance Company]

[list ofRMBS Issues in RMBS Pool to come]

[VALIC]

[list ofRMBS Issues in Rl"mS Pool to come]

[SUDAmerica Consolidated]

{list of RMBS Issues in RMBS Paollo -come]

8

(NY) 07865i002/ML.lJ!termsheet.ml.ll.doc 111051088:33 PM
Annex D
MAIDEN LANE JIJ

Term Sheet

November U, 2008

Set forth below is a summa!)' of proposed tenns relating to the transaction under which a newlycreated special purpose vehicle ("ML III") will purchase a certain pool of assets ("Assets") from

Icounterparty] ("Cou nterparty"), who will <:oncurrently unwind related derivative transactions

("CDS Transactions") that it has entered into with AIG Financial Products Corp. ("AIG-FP")

and for which American International Group, Inc. ("AIG") has provided certain -credit support

obligations. The Assets are the reference obligations underlying the CDS Transactions, each as set

forth in Schedule A hereto (subject to verification by the parties hereto).

TOTAL PAYMENT TO

COUNTERPARTY

2 TERMINATION

AGREEMENT

3 FORWARD PURCHASE

AGREEMENT

INY) 07S65iO021MUI1ICP.Tonnsh..tdoc

Under the Forward Purchase Agreement and the

Tennination Agreement describe.d below, for the

termination ofthe CDS transactions and the purchase

ofthe Assets, Counterparty will be paid the notional

amount for the. CDS Transactions, subject to certain

adjustments described in the Forward Purchase

Agreement.

ML III and AIG·FP will enter into a Termination

Agreement with Counterpart)' -substanlially in the form

of Exhibit A hereto to tenninate the CDS Transactions

and release and discharge AlG-FP's and AlG's

obligations under and in respect of the CDS

Transactions and the Counterparty may set off against

collateral posted under the CDS Transactions as

described in the Termination Agreement.

ML III will simultaneously with the Temlination

Agreement enter into a Forward Purchase Agreement

with Counterpart)1 substantially in the form of Exhibit

B hereto pursuant to which Counterparty will deliver,

or use best effons to deliver, the Assets to an escrow

agent in preparation for their sale to ML III under the

Forward Purchase Agreement against payment of the

notional amount to Counterparty, taking into account

any collateral posted by AIG-FP in relation to the CDS

Transactions and certain adjustments set fonh in the

Forward Purchase Agreement.
Subject to the fonnation of ML JI I, and the public announcement ofthe funding of ML' III by the

Fe·deral Reserve Bank of New York and American International Group, Inc. in an amount

sufficient for ML III to perfoml under the transactions summarized above, [Counterparty] hereby

commits, as of the date hereof, to enter into the transactions summarized in the above Term Sheet

and to execute the Forward Purchase Agreement and Tem1ination Agreement in substantially the

same form as the versions annexed hereto.

For and on behalf of

[COUNTERPARTY)

Name:

Title:

Agreed to and accepted by:

AIGFINANCIAL PRODUCTS CORP.

Name:

Title:

Acknowledged by:

FEDERAL RESERVE BANK OF NEW YORK

Name:

Title:

2

(NY) 01865iOO2!ML 1I1iCI'.T~rl1ls"e.t.dDC
(NY) 07865!OO2lML.!l1iCP.Tcnnsheel.doc

List of Assets

Schedule A
Form of Termination Agreement

(NY) 07~65iOO1!ML.1IIiCP.1erm.lltel.doc

Exhibit A
Form ofForward Purchase Agreement

It\Yj 07865!002IML.lIl/CI'.Tcnnshccr.doc

Exhibit B
AMERICAN INTERNATIONAL GROUP, INC.

RESOLUTIONS OF THE

OF THE BOARD OF DIRECTORS

NOVEMBER 19,2008

Series D Preferred

RESOLVED, that this Board of Directors (the "Board") hereby (i)

determines that the Series D Fixed Rate CumuJative Perpetual Preferred Stock, par value

$5.00 (the "Series D Preferred Stock"), ofthe Corporation shaH have the powers,

designations, preferences, rights, qualifications, limitations and restrictions specified in

the Certificate of Designations (the "Series D Preferred Certificate of Designations")

attached hereto as Armex A, and (ii) such Series D Preferred Certificate of Designations

is hereby approved with such changes as the Chaimlan and ChiefExecutive Officer, any

Vice Chaimlan, any Executive Vice President, the Secretary or the Treasurer (each, an

"Authorized Officer") ofthe Corporation may deem necessary, desirable or appropriate,

such necessity, desirability or appropriateness to be conclusively evidenced by the

execution thereof;

FURTHER RESOLVED, that any Authorized Officer ofthe Corporation

is hereby instructed to file such Series D Preferred Certificate of Designations with the

office ofthe Secretary of State ofthe State of Delaware, and (ii) to restate the Restated

Certificate ofIncorporation ofthe Corporation to integrate (and not further amend) the

Restated Certificate of lncorporation in connection with the Series D Preferred Certificate

of Designations;

Warrant

FURTHER RESOLVED, that this Board hereby (i) approves the warrant

(the "Warrant") attached hereto as Annex B for the purchase by the United States

Department oftbe Treasury of 53,798,766 shares of common stock, par value $2.50 per

share (the "Common Stock"), ofthe Corporation in accordance with the terms thereof,

\\'ith such changes as any Authorized Officer may deem necessary, desirable or

appropriate, such necessity, desirability or appropriateness to be conclusively evidenced

by the execution thereof, and (ii) reserves up to 53,798,766 shares of Common Stock

from the authorized shares ofCommon Stock ofthe Corporation for issuance and

delivery in connection with the exercise ofthe Warrant.

Transfer Agent and Registrar

RESOLVED, that Wells Fargo Bank, National Association, its successors

and assigns, be and hereby is appointed Transfer Agent, Registrar and Dividend

Disbursing Agent, effective for all shares ofthe Series D Preferred Stock, to act in

accordance with its general practices and the Transfer Agent Services Agreement dated

as of September 28,2007.
Annex A

CERTIFICATE OF DESIGNATIONS

OF

SERIES D FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK

OF

AMERICAN INTERNATIONAL GROUP, INC.

American International Group, Inc., a corporation organized and existing under the

General Corporation Law of the State of Delaware (the "Company"), hereby certifies that the

following resolution was adopted by the Board of Directors of the Company (the "Board of

Directors") as required by Section 151 of the General Corporation Law of the State of Delaware

at a meeting duly held on November [ ],2008.

RESOLVED, that pursuant to the authority granted to and vested in the Board of

Directors in accordance with the provisions of the Restated Certificate of Incorporation, as

amended, the Board of Directors hereby creates a series of Serial Prefened Stock, par value

$5.00 per share, of the Company, and hereby states the designation and number of shares, and

fixes the voting and other powers, and the relative rights and preferences, and the qualifications,

limitations and restrictions thereof, as follows:

Series D Fixed Rate Cumulative Perpetual PrefelTed Stock:

Part 1. Designation and Number of Shares. There is hereby created out of the authorized

and unissued shares of serial prefened stock of the Company a series of preferred stock

designated as the "Series D Fixed Rate Cumulative Perpetual Prefened Stock" (the "Series D

Preferred Stock"). The authorized number ofshares of the Series D Preferred Stock shall be

4,000,000. Such number of shares may be decreased by resolution of the Board of Directors,

subject to the terms and conditions hereof; provided that no decrease shall reduce the number of

shares of the Series D Preferred Stock to a number less than the number of shares then

outstanding.

Part 2. Standard Provisions. The Standard Provisions contained in Annex A attached

hereto are incorporated herein by reference in their entirety and shall be deemed to be a part of

this Certificate of Designations to the same extent as ifsuch provisions had been set forth in full

herein.

Part. 3. Definitions. The following terms are used in this Certificate of Designations

(including the Standard Provisions in Annex A hereto) as defined below:

(a)

Company.

"Common Stock" means the common stock, par value $2.50 per share, of the

(NY) 07865JOO2fT"ARP/Senior.Preferred.COD.doc IJI)8/08 9:48 PM
(b) "Convertible Preferred Stock" means the Series C Perpetual, Convertible,

Participating Preferred Stock of the Company. The Convertible Preferred Stock shall be Parity

Stock; provided that the Convertible Preferred Stock shall be Junior Stock following the

effectiveness of an amendment to the Ch3Iter to allow the Series D Preferred Stock to rank

senior to the Convertible Preferred Stock as to dividends rights and/or rights upon the

liquidation, dissolution and winding up (the "Amendment").

(c) "Dividend Payment Date" means February 1, May 1, August 1 and November 1

of each year.

(d) "Junior Stock" means the Common Stock, the Convenible Preferred Stock

(following the Amendment) and any other class or series of stock of the Company the terms of

which expressly provide that it ranks junior to the Series D Preferred Stock as to dividend rights

and/or as to rights on liquidation, dissolution or winding up of the Company.

(e) "Liquidation Amount" means $10,000 per share of the Series D Prefened Stock.

(f) "Parity Stock" means the Convertible Prefened Stock (before the Amendment)

and any class or series of stock of the Company (other than the Series D Preferred Stock) the

terms of which do not expressly provide that such class or series will rank senio! or junior to the

Series D Preferred Stock as to dividend rights and/or as to rights on liquidation, dissolution or

winding up of the Company (in each case without regard to Whether dividends accrue

cumulatively or non-cumulatively).

(h) "Signing Date" means November [ ], 2008.

Part. 4. Certain Voting Matters. Whether the vote or consent of the holders of a plurality,

majority or other portion of the shares of the Series D Preferred Stock and any Voting Parity

Stock has been cast or given on any matter on which the holders of shares of the Series D

Preferred Stock and any Voting Parity Stock are entitled to vote or consent together as a class

shall be determined by the Company by reference to the specified liquidation amount of the

shares of the Series D Preferred Stock voted or with respect to which a consent has been received

as if the Company were liquidated on the record date for such vote or consent, if any, or, in the

absence of a record date, on the date for such vote or consent. For purposes of determining the

voting rights of the holders of the Series D Prefened Stock under Section 7 of the Standard

Provisions forming part ofthis Certificate of Designations, each holder will be entitled to one

vote for each $10,000 of liquidation preference to which such holder's shares are entitled.

[Remainder ofPage Intentionally Left Blank]

2

(NY) 078651OO2ffARPISenior.Preferred.COD.doc 111181089:48 PM
IN WITNESS WHEREOF, the Company has caused this Certificate of Designations to

be signed on its behalf by its and attested by its Secretary this _th

day of November, 2008.

.American International Group, Inc.

By:

Name:

Title:

ATTEST:

Name:

Title: Secretary

3

(NY) 078651OO2ffARPlSenior.Preferred.COD.doc 11/18108 9:48 PM
ANNEXA

STANDARD PROVISIONS

Section 1. General Matters. Each share of the Series D Preferred Stock shall be identical

in all respects to every other share of the Series D Preferred Stock. The Series D Preferred Stock

shall be perpetual, subject to the provisions of Section 5 of these Standard Provisions that form a

part of the Certificate of Designations. The Series D Preferred Stock (a) shall rank senior to the

Junior Stock in respect of the right to receive dividends and the right to receive payments out of

the assets of the Company upon voluntary or involuntary liquidation, dissolution or winding up

of the Company and (b) shall be of equal rank with Parity Stock as to the right to receive

dividends and the right to receive payments out of the assets of the Company upon voluntary or

involuntary liquidation, dissolution or winding up of the Company.

Section 2. Standard Definitions. As used herein with respect to the Series D Preferred

Stock:

(a) "Applicable Dividend Rate" means 10% per annum.

(b) "Business Combination" means a merger, consolidation, statutory share exchange

or similar transaction that requires the approval of the Company's stockholders.

(c) "Business Day" means any day except Saturday, Sunday and any day on which

banking institutions in the State of New York generally are authorized or required by law or

other governmental actions to close.

(d)

to time.

"Bylaws" means the bylaws of the Company, as they may be amended from time

(e) "Certificate of Designations" means the Certificate of Designations or comparable

instrument relating to the Series D Preferred Stock, of which these Standard Provisions form a

part, as it may be amended from time to time.

(f)

amended.

(g)

(h)

"Charter" means the Company's Restated Certificate of Incorporation, as

"Dividend Period" has the meaning set forth in Section 3(a).

"Dividend Record Date" has the meaning set forth in Section 3(a).

(i) "Original Issue Date" means the date on which shares of the Series D Preferred

Stock are first issued.

(j) "Preferred Director" has the meaning set forth in Section 7(b).

(k) "Preferred Stock" means any and all series of serial preferred stock of the

Company, including the Series D Preferred Stock.

E-J

(NY) 07865fOO2fTARP/Senior.Preferred.COD.doc . 11/181089:48 PM
(1) "Share Dilution Amount" has the meaning set forth in Section 3(b).

(m) "Standard Provisions" mean these Standard Provisions that form a part of the

Certificate of Designations relating to the Series D Preferred Stock.

(n) "Trust" means the AIG Credit Facility Trust.

(0) "Voting Parity Stock" means, with regard to any matter as to which the holders of

the Series D Preferred Stock are entitled to vote as specified in Sections 7(a) and 7(b) of these

Standard Provisions that form a part of the Certificate of Designations, any and all series of

Parity Stock upon which like voting rights have been confeITed and are exercisable with respect

to such matter.

Section 3.. Dividends.

(a) Rate. Holders of the Series D Preferred Stock shall be entitled to receive, on each

share of the Series D Preferred Stock if, as and when declared by the Board of Directors or any

duly authorized committee of the Board of Directors, but only out of assets legally available

therefor, cumulative cash dividends with respect to each Dividend Period (as defined below) at a

rate per annum equal to the Applicable Dividend Rate on (i) the Liquidation Amount per share of

the Series D Preferred Stock and (ii) the amount of accmed and unpaid dividends for any prior

Dividend Period on such share of the Series D Preferred Stock, if any. Such dividends shall

begin to accrue and be cumulative from the Original Issue Date, shall compound on.each

subsequent Dividend Payment Date (i.e., no dividends shall accme on other dividends unless and

until the first Dividend Payment Date for such other dividends has passed without such other

dividends having been paid on such date) and shall be payable quarterly in arrears on each

Dividend Payment Date, commencing with the first such Dividend Payment Date to occur at

least 20 calendar days after the Original Issue Date. In the event that any Dividend Payment

Date would otherwise fall on a day that is not a Business Day, the dividend payment due on that

date will be postponed to the next day that is a Business'Day and no additional dividends will

accrue as a result of that postponement. The period from and including any Dividend Payment

Date to, but excluding, the next Dividend Payment Date is a "Dividend Period", provided that

the initial Dividend Period shall be the period from and including the Original Issue Date to, but

excluding, the next Dividend Payment Date.

Dividends that are payable on Series D Preferred Stock in respect of any Dividend Period

shall be computed on the basis of a 360-day year consisting of twelve 30-day months. The

amount of dividends payable on Series D Preferred Stock on any date prior to the end of a

Dividend Period, and for the initial Dividend Period, shall be computed on the basis of a 360-day

year consisting oftwelve 30-day months, and actual days elapsed over a 30-day month.

Dividends that are payable on Series D Preferred Stock on any Dividend Payment Date

will be payable to holders of record of the Series D Preferred Stock as they appear on the stock

register of the Company on the applicable record date, which shall be the 15th calendar day

immediately preceding such Dividend Payment Date or such other record date fixed by the

Board of Directors or any duly authorized committee of the Board of Directors that is not more

than 60 nor less than 10 days prior to such Dividend Payment Date (each, a "Dividend Record

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Date"). Any such day that is a Dividend Record Date shall be a Dividend Record Date whether

or not such day is a Business Day.

Holders ofthe Series D Prefened Stock shall not be entitled to any dividends, whether

payable in cash, securities or other property, other than dividends (if any) declared and payable

on the Series D Prefened Stock as specified in this Section 3 (subject to the other provisions of

the Certificate of Designations).

(b) Priority of Dividends. So long as any share of the Series D Prefened Stock

remains outstanding, no dividend or distribution shall be declared or paid on the Common Stock

or any other shares of Junior Stock (other than dividends payable solely in shares of Common'

Stock) or Parity Stock, subject to the immediately following paragraph in the case of Parity

, Stock, and no Common Stock, Junior Stock or Parity Stock shall be, directly or indirectly,

purchased, redeemed or otherwise acquired for consideration by the Corporation or any of its

subsidiaries unless all accrued and unpaid dividends for all past Dividend Periods, including the

latest completed Dividend Period (including, if applicable as provided in Section 3(a) above,

dividends on such amount), on all outstanding shares of the Series D Preferred Stock have been

or are contemporaneously declared and paid in full (or have been declared and a sum sufficient

for the payment thereof has been set aside for the benefit of the holders of shares of the Series D

Preferred Stock on the applicable record date). The foregoing limitation shall not apply to (i) a

dividend payable on any Junior Stock in shares of any other Junior Stock, or to the acquisition of'

shares of any Junior Stock in exchange for, or through application of the proceeds of the sale of,

shares of any other Junior Stock; (ii) redemptions, purchases or other acquisitions of shares of

Common Stock or other Junior Stock in connection with the administration of any employee

benefit plan in the ordinary course of business (including purchases to offset the Share Dilution

Amount (as defined below) pursuant to a publicly announced repurchase plan) and consistent

with past practice, provided that any purchases to offset the Share Dilution Amount shall in no

event exceed the Share Dilution Amount; (iii) any dividends or distributions of rights or Junior

Stock in connection with a stockholders' rights plan or any redemption or repurchase of rights

pursuant to any stockholders' rights plan; (iv) the acquisition by the Company or any of its

subsidiaries of record ownership in Junior Stock or Parity Stock for the beneficial ownership of

any other persons (other than the Corporation or any of its subsidiaries), including as trustees or

custodians; and (v) the exchange or conversion ofJunior Stock for or into other Junior Stock or

of Parity Stock for or into other Parity Stock (with the same or lesser aggregate liquidation

amount) or Junior Stock, in each case, solely to the extent required pursuant to binding

contractual agreements entered into prior to the Signing Date or any subsequent agreement for

the accelerated exercise, settlement or exchange thereof for Common Stock. "Share Dilution

Amount" means the increase in the number of diluted shares outstanding (detemiined in

accordance with generally accepted accounting principles in the United States, and as measured

from the date of the Company's consolidated financial statements most recently filed with the

Securities and Exchange Commission prior to the Original Issue Date) resulting from the grant,

vesting or exercise of equity-based compensation to employees and equitably adjusted for any

stock split, stock dividend, reverse stock split, reclassification or similar transaction.

When dividends are not paid (or declared and a sum sufficient for payment thereofset

aside for the benefit of the holders thereof on the applicable record date) on any Dividend

Payment Date (or, in the case of Parity Stockhaving dividend payment dates different from the

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Dividend Payment Dates, on a dividend payment date falling within a Dividend Period related to

such Dividend Payment Date) in full upon the Series D Preferred Stock and any shares of Parity

Stock, all dividends declared on the Series D Preferred Stock and all such Parity Stock and

payable on such Dividend Payment Date (or, in the case of Parity Stock having dividend

payment dates different from the Dividend Payment Dates, on a dividend payment date falling

within the Dividend Period related to such Dividend Payment Date) shall be declared pro rata so

that the respective amounts of such dividends declared shall bear the same ratio to each other as

all accrued and unpaid dividends per share on the shares of the Series D Preferred Stock

(including, if applicable as provided in Section 3(a) above, dividends on such amount) and all

Parity Stock payable on such Dividend Payment Date (or, iIi the case of Parity Stock having

dividend payment dates different from the Dividend Payment Dates, on a dividend payment date

falling within the Dividend Period related to such Dividend Payment Date) (subject to their

having been declared by the Board of Directors or a duly authorized committee of the Board of·

Directors out of legally available funds and including, in the case of Parity Stock that hears

cumulative dividends, all accrued but unpaid dividends) bear fo each other. If the Board of

Directors or a duly authorized committee of the Board of Directors determines not to pay any

dividend or a full dividend on a Dividend Payment Date, the Company will provide written

notice to the holders of the Series D Preferred Stock prior to such Dividend Payment Date.

Subject to the foregoing, and not otherwise, such dividends (payable in cash, securities or

other property) as may be determined by the Board of Directors or any duly authorized

committee of the Board of Directors may be declared and paid on any securities, including

Common Stock and other Junior Stock, from time to time out of any funds legally available for

such payment, and holders of the Series D PrefelTed Stock shall not be entitled to participate in

any such dividends.

Section 4. Liquidation, Dissolution or Winding Up. In the event of any voluntary or

involuntary liquidation, dissolution or winding up of the affairs of the Company, then, before any

distribution or payment shall be made to the holders of Junior Stock, the holders of the Series D

Preferred Stock and any shares of Preferred Stock ranking on a parity therewith as to liquidation

shall be entitled to be paid in full the respective amounts of the liquidation preferences thereof,

which in the case of the Series D Preferred Stock shall be $10,000.00 per share, plus an amount

equal to all accrued and unpaid dividends to such distribution or payment date, whether or not

earned or declared (including, if applicable, as provided in Section 3(a) above, dividends on such

accrued and unpaid dividends for all prior Dividend Periods). If such payment shall have been

made in full to the holders of the Series D Preferred Stock and any series of Preferred Stock

ranking on a parity therewith as to liquidation, the remaining assets and funds of the Company·

shall be distributed among the holders ofJunior Stock, according to their respective rights and

preferences and in each case according to their respective shares. If, upon any liquidation,

dissolution or winding up of the affairs of the Company, the amounts so payable are not paid in

full to the holders of all outstanding shares of the Series D Preferred Stock and any series of

Preferred Stock ranking on a parity therewith as to liquidation, the holders of the Series D

Preferred Stock and any series of Preferred Stock ranking on a parity therewith as to liquidation

shall share ratably in any distribution of assets in proportion to the full amounts to which they

would otherwise be respectively entitled. Neither the consolidation or merger of the Company,

nor the sale, lease or conveyance of all or a part of its assets, shall be deemed a liquidation,

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dissolution or winding up of the affairs of the Company within the meaning of the foregoing

provisions of this Section 4.

Section 5. Redemption.

(a) Optional Redemption. Except as provided in this Section 5(a), the Designated

Preferred Stock shall not be redeemable. At any time that (i) the Trust (or any successor entity

established for the benefit of the United States Treasury) "beneficially owns" less than 30% of

the aggregate voting power of the Company's voting securities and (ii) no holder of the Series D

Preferred Stock controls the Company, the Company may redeem, in whole or in part, at any

time and from time to time, out of funds legally available therefor, the shares of the Series D

Preferred Stock at the time outstanding, upon notice given as prov-ided in· Section S(c) below, the

Series D Preferred Stock in whole or in part at a redemption price equal to 100% of its

Liquidation Amount, plus, except as set forth in the last sentence of the next paragraph, an

amount equal to all accrued and unpaid dividends to such redemption date (including, if

applicable, as provided in Section 3(a) above, dividends on accrued and unpaid dividends for all'

prior Dividend Periods). "Control" for purposes of this Section S(a) means the power to direct'

the management and policies of the Company, directly or indirectly, whether through the

ownership of voting securities, by contract, by the power to control the Board of Directors or

otherwise. "Beneficially owns" for purposes of this Section S(a) is defined in Rule 13d-3 under'

the Securities Exchange Act of 1934, as amended to the Signing Date. For the avoidance of

doubt, while there is Board of Directors control (or the potential to gain Board of Directors

control as a result of existing contractual rights) by any holder of the Series D Preferred Stock,

the Company may not redeem any of the Series D Preferred Stock.

The redemption price for any shares of the Series D Preferred Stock shall be payable on

the redemption date to the holder of such shares against surrender of the certificate(s) evidencing

such shares to the Company or its agent. Any declared but unpaid dividends payable on a

redemption date that occurs subsequent to the Dividend Record Date for a Dividend Period shall

not be paid to the holder entitled to receive the redemption price on the redemption date, but

rather shall be paid to the holder of record of the redeemed shares on such Dividend Record Date

relating to the Dividend Payment Date as provided in Section 3 above. .

(b) No Sinking Fund. The Series D Preferred Stock will not be subject to any

mandatory redemption, sinking fund or other similar provisions. Holders of the Series D

Preferred Stock will have no right to require redemption or repurchase of any shares of the Series

D Preferred Stock.

(c) Notice of Redemption. Notice of every redemption of shares of the Series D

Preferred Stock shall be given by first class mail, postage prepaid, addressed to the holders of

record of the shares to be redeemed at their respective last addresses appearing on the books of

the Company. Such mailing shall be at least 30 days and not more than 60 days before the date

fixed for redemption. Any notice mailed as provided in this Subsection shall be conclusively

presumed to have been duly given, whether or not the holder receives such notice, but failure

duly to give such notice by mail, or any defect in such notice or in the mailing thereof, to any

holder of shares of the Series D Preferred Stock designated for redemption shall not affect the

validity of the proceedings for the redemption of any other shares of the Series D Preferred

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Stock. Notwithstanding the foregoing, if shares of the Series D Preferred Stock are issued in

book-entry fOlm through The Depository TlUst Corporation or any other similar facility, notice

of redemption may be given to the holders of the Series D Prefened Stock at such time and in

any manner pelmitted by such facility. Each notice of redemption given to a holder shall state:

(1) the redemption date; (2) the number of shares of the Series D Prefened Stock to be redeemed

and, if less than all the shares held by such holder are to be redeemed, the number of such shares

to be redeemed from such holder; (3) the redemption price; and (4) the place or places where

certificates for such shares are to be surrendered for payment of the redemption price, but failure

duly to give such notice to any holder of shares of the Series D Preferred Stock designated for

redemption or any defect in such notice shall not affect the validity of the proceedings for the

redemption of any other shares of the Series D Preferred Stock.

(d) Partial Redemption. In case of any redemption of part of the shares of the Series.

D Preferred Stock at the time outstanding, the shares to be redeemed shall be selected either pro

.rata or in such other manner as the Board of Directors or a duly authorized committee thereof

may determine to be fair and equitable. Subject to the provisions hereof, the Board of Directors

or a duly authorized committee thereof shall have full power and authority to prescribe the terms

and conditions upon which shares of the.Series D PrefeITed Stock shall be redeemed from time to

time. Iffewer than all the shares represented by any certificate are redeemed, a new certificate

shall be issued representing the unredeemed shares without charge to the holder thereof.

(e) Effectiveness of Redemption. If notice of redemption has been duly given and if

on or before the redemption date specified in the notice all funds necessary for the redemption

have been deposited by the Company, in tlUst for the pro rata benefit of the holders of the shares

called for redemption, with a bank or trust company doing business in the Borough of

Manhattan, The City of New York, and having a capital and surplus of at least $500 million and

selected by the Board of Directors; so as to be and continue to be available solely therefor, then, .

notwithstanding that any certificate for any share so called for redemption has not been

sUlTendered for cancellation, on and after the redemption date dividends shall cease to accrue on

all shares so called for redemption, all shares so called for redemption shall no longer be deemed

outstanding and all rights with respect to such shares shall forthwith on such redemption date

cease and terminate, except only the right of the holders thereof to receive the amount payable on

such redemption from such bank or trust company, without interest. Any funds unclaimed at the

end of three years from the redemption date shall, to the extent permitted by law, be released to

the Company, after which time the holders of the shares so called for redemption shall look only

to the Company for payment of the redemption price of such shares. .

(f) Status of Redeemed Shares. Shares of the Series D Prefened Stock that are

redeemed, repurchased or otherwise acquired by the Company shall revert to authorized but

unissued shares ofthe Series D Preferred Stock (provided that any such cancelled shares of the

Series D Preferred Stock may be reissued only as shares of any series of the Series D Preferred

Stock other than the Series D Preferred Stock).

Section 6. Conversion. Holders of the Series D Preferred Stock shares shall have no right

to exchange or convert such shares into any other securities.

Section 7. Voting Rights.

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(a) General. The holders of the Series D Preferred Stock shall not have any voting

rights except as set forth below or as otherwise from time to time required by law.

(b) Series D Preferred Stock Directors, Whenever, at any time or times, dividends

payable on the shares of the Series D Preferred Stock have not been paid for an aggregate of four

quarterly Dividend Periods or more., whether or not consecutive, the authorized number of

directors of the Company shall automatically be increased to accommodate the number of the

Preferred Directors specified below and the holders of the Series D Preferred Stock shall have

the right, with holders of shares of anyone or more other classes or series of Voting Parity Stock

outstanding at the time, voting together as a class, to elect the greater of two directors and a

number of dhectors (rounded upward) equal to 20% of the total number of directors of the

Company after giving effect to such election (hereinafter the "Preferred Directors" and each a

'''Preferred Director") to fill such newly created directorships at the Company's next annual

meeting of stockholders (or at a special meeting called for that purpose prior to such next annual

meeting) and at each subsequent annual meeting ofstockholders until all acclUed and unpaid

dividends for all past Dividend Periods, including the latest completed Dividend Period

(including, if applicable as provided in Section 3(a) above, dividends on such amount), on all

outstanding shares of the Series D Preferred Stock have been declared and paid in full at which·

time such right shall terminate with respect to the Series D Preferred Stock, except as herein or

by law expressly provided, subject to revesting in the event of each and every subsequent

payment failure of the character above mentioned; provided that it shall be a qualification for

election for any Preferred Director that the election of such Preferred Director shall not cause the

Company to violate any corporate governance requirements of any securities exchange or other

trading facility on which securities of the Company may then be listed or traded that listed or

traded companies must have a majority of independent directors. Upon any telmination of the

right ofthe holders of shares of the Series D Preferred Stock and Voting Parity Stock as a class

to vote for directors as provided above, the Preferred Directors shall cease to be qualified as

. directors, the term of office of all Preferred Directors then in office shall terminate immediately

and the authorized number of directors shall be reduced by the number of the Preferred Directors

elected pursuant hereto, Any Preferred Director may be removed at any time, with or without

cause, and any vacancy created thereby may be filled, only by the affirmative vote of the holders

a majority of the shares ofthe Series D Preferred Stock at the time outstanding voting separately

as a class together with the holders of shares of Voting Parity Stock, to the extent the voting

rights of such holders described above are then exercisable. If the office of any Preferred

Director becomes vacant for any reason other than removal from office as aforesaid, the

remaining Preferred Director may choose a successor who shall hold office for the unexpired

term in respect of which such vacancy occurred.

(c)· Class Voting Rights as to Particular Matters. So long as any shares of the Series D

Preferred Stock are outstanding, in addition to any other vote or consent of stockholders required

by law or by the Charter, the vote or consent of the holders of at least 66 2/3% of the shares of

the Series D Preferred Stock at the time outstanding, voting as a separate class, given in person

or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose,

shall be necessary for effecting or validating:

(i) Authorization of Senior or Pari Passu Stock. Any amendment or alteration

of the Certificate of Designations for the Series D Preferred Stock or the Chal1er to

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authorize or create or increase the authorized amount of; or any issuance of, any shares

of, or any securities convertible into or exchangeable or exercisable for shares of, any

class or series of capital stock of the Company ranking senior to or pari passu with Series

DPreferred Stock with respect to either or both the payment of dividends and/or the

distribution of assets on any liquidation, dissolution or winding up of the Company;

provided that no such vote or consent of the holders of the Series D PrefelTedStock shall

be required for the issuance of the Convertible PrefelTed Stock;

(ii) .Amendment of the Series D Preferred Stock. Any amendment, alteration

or repeal of any provision of the Certificate of Designations for the Series D Preferred

Stock or the Charter (including, unless no vote on such merger or consolidation is

required by Section 7(c)(iii) below, any amendment, alteration or repeal by means of a

merger, consolidation or otherwise) so as to adversely affect the rights, preferences,

privileges or voting powers of the Series D Preferred Stock; or

(iii) Share Exchanges, Reclassifications, Mergers and Consolidations. Any

consummation of a binding share exchange or reclassification involving the Series D

Preferred Stock, or of a merger or consolidation of the Company with or into another

corporation or other entity, unless in each case (x) the shares of the Series D Preferred

Stock remain outstanding and are not amended in any respect or, in the case of any such

merger or consolidation with respect to which the Company is not the surviving or

resulting entity, are converted into or exchanged for preference securities of the ·surviving

or resulting entity or its ultimate parent, and (y) such shares remaining outstanding or

such preference securities, as the case may be, have such rights,· preferences, privileges

and voting powers, and limitations and restrictions thereof, taken as a whole, as are not

materially less favorable to the holders thereof than the rights, preferences, privileges and

voting powers, and limitations and restrictions thereof, of the Series D Prefened Stock

immediately prior to such consummation, taken as a whole;

provided, however, that for all purposes of this Section 7(c), any increase in the amount of the

authorized Preferred Stock, including any increase in the authorized amount of the Series D .

Preferred Stock necessary to satisfy preemptive or similar rights granted by the Company to.

other persons prior to the Signing Date, or the creation and issuance, or an increase in the

authorized or issued amount, whether pursuant to preemptive or similar rights or otherwise, of

any other series of the Preferred Stock, or any securities convertible into or exchangeable or

exercisable for any other series of the Preferred Stock, ranking junior to the Series D Preferred

Stock with respect to the payment of dividends (whether such dividends are cumulative or noncumulative) and the distribution of assets upon liquidation, dissolution or winding up of the

Company will not be deemed to adversely affect the rights, preferences, privileges or voting

powers, and shall not require the affirmative vote or consent of, the holders of outstanding.shares

of the Series D Preferred Stock.

(d) Changes after Provision for Redemption. No vote or consent of the holders of the

Series D Preferred Stock shall be required pursuant to Section 7(c) above if, at or prior to the

time when any such vote or consent would otherwise be required pursuant to such Section, all

outstanding shares of the Series D Preferred Stock shall have been redeemed, or shall have been

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called for redemption upon proper notice and sufficient funds shall have been deposited in trust

for such redemption, in each case pursuant to Section 5 above.

(e) Procedures for Voting and Consents. The rules and procedures for calling and

conducting any meeting of the holders of the Series D PrefeITed Stock (including, without

limitation, the fixing of a record date in connection therewith), the solicitation and use of proxies

at such a meeting, the obtaining of written consents and any other aspect or matter with regard to

such a meeting or such consents shall be governed by any rules of the Board of Directors or any

duly authorized committee of the Board of Directors, in its discretion, may adopt from time to

time, which rules and procedures shall conform to the requirements of the Charter, the Bylaws,

and applicable law and the rules of any national securities exchange or other trading facility on" .

which Series D PrefeITed Stock is listed or traded at the time.

Section 8. Record Holders. To the fullest extent permitted by 'applicable law, the

Company and the transfer agent for Series D Preferred Stock may deem and treat the record

holder of any share of the Series D PrefeITed Stock as the true and lawful owner thereof for all

purposes, and neither the Company nor such transfer agent shall be affected by any notice to the

contrary.

Section 9. Notices. All notices or communications in respect of the Series D Preferred

Stock shall be sufficiently given if given in writing and delivered in person or by first class mail,

postage prepaid, or if given in such other manner as may be permitted in this Certificate of

Designations, in the Charter or Bylaws or by applicable law: Notwithstanding the foregoing~ if

shares of the Series D PrefeITed Stock are issued in book-entry form through The Depository

Trust Company or any similar facility, such notices may be given to the holders of the Series D

Preferred Stock in any manner permitted by such facility.

Section 10. No Preemptive Rights. No holder of the Series D PrefeITed Stock shall be

entitled as a matter of right to subscribe for or purchase, or have any preemptive right with

respect to, any part of any new or additional issue of stock of any class whatsoever, or of

securities convertible into any stock of any class whatsoever, whether now or hereafter

authorized and whether issued for cash or other consideration or by way of dividend.

Section 11. Replacement Certificates. The Company shall replace any mutilated

certificate at the holder's expense upon surrender of that certificate to the Company. The

Company shall replace certificates that become destroyed, stolen or lost at the holder's expense

upon delivery to the Company of reasonably satisfactory evidence that the certificate has been

destroyed, stolen or lost, together with any indemnity that may be reasonably required by the

Company.

Section 12. Form.

(a) The Series D PrefeITed Stock shall be initially issued in the form of one or more

certificates in definitive, fully registered form with, until such time as otherwise determined by

the Company, the restricted shares legend (the "Restricted Shares Legend"), as set forth on the

form of the Series D PrefeITed Stock attached hereto as Exhibit A (each, a "Series D Prefened

Share Certificate"), which is hereby incorporated in and expressly made a part of this Certificate

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of Designations. The Series D Preferred Share Certificate may have notations, legends or

endorsements required by law, stock exchange rules, agreements to which the Company is

subject, if any, or usage (provided that any such notation, legend or endorsement is in a form

acceptable to the Company).

(b) An Officer shall sign the Series D Prefened Share Certificate for the Company, in

accordance with the Company's Bylaws and applicable law, by manual or-facsimile signature.

"Officer" means the Chairman, any Vice President, the Treasurer or the Secretary of the

Company.

(c) If an Officer whose signature is on a Series D Prefened Share Certificate no

longer holds that office at the time the of the issuance of such Series D Preferred Share

Certificate, such Series D Preferred Share Certificate shall be valid nevertheless.

(d) A Series D Preferred Share Certificate shall notbe valid or obligatory until an

authorized signatory of the Transfer Agent manually countersigns the Series D Prefened Share

Certificate. The signature shall be conclusive evidence that such Series D Preferred Sl1are

Certificate has been authenticated under this Certificate of Designations. Each Series D

Preferred Share Certificate shall be dated the date of its authentication.

Other than upon original issuance, all transfers and exchanges of the Designated

Preferred Stock shall be made by direct registration on the books and records of the Company.

Section 13. Transfer Agent And Registrar. The duly appointed Transfer Agent and

Registrar for the Series D Preferred Stock shall be Wells Fargo Bank, N.A. The Company may,

in its sole discretion, remove the Transfer Agent in accordance with the agreement between the

Company and the Transfer Agent; provided that the Company shall appoint a successor transfer

agent who shall accept such appointment prior to the effectiveness of such removal.

Section 14. Other Rights. The shares of the Series D Preferred Stock shall not have

any rights, preferences, privileges or voting powers or relative, participating, optional or other

special rights, or qualifications, limitations or restrictions thereof, other than as set forth herein or

in the Charter or as provided by applicable law.

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EXHIBIT A

FORM OF SERIES D FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK

($10,000 LIQUIDATION PREFERENCE)

NUMBER

1

SHARES

4,000,000

CUSIP[ -.1

AMERICAN INTERNATIONAL GROUP, INC.

INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE

THIS CERTIFICATE IS TRANSFERABLE

IN THE CITY OF NEW YORK, NEW YORK

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN

REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE

"SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE

TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A

REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT

AND APPLICABLE STATESECURITIES LAWS OR PURSUANT TO AN EXEMPTION

FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS. EACH PURCHASER OF

THE SECURITIES REPRESENTED BY THIS INSTRUMENT IS NOTIFIED THAT THE

SELLER MAYBE RELYING ON THE EXEMPTION FROM SECTION 5 OF THE

SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. ANY TRANSFEREE OF

THE SECURITIES REPRESENTED BY THIS INSTRUMENT BY ITS ACCEPTANCE .

HEREOF (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS

DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (2) AGREES THAT IT WILL

NOT OFFER, SELL OR OTHERWISE TRANSFER THE SECURITIES REPRESENTED BY

THIS INSTRUMENT EXCEPT (A) PURSUANT TO A REGISTRATION STATEMENT

WHICH IS THEN EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO LONG AS

THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE ELIGIBLE FOR

RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A

"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE

SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE

ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN

THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO THE

ISSUER OR (D) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE

REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT

IT WILL GIVE TO EACH PERSON TO WHOM THE SECURITIES REPRESENTED BY

THIS INSTRUMENT ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE

EFFECT OF THIS LEGEND.

This is to certify that the UNITED STATES DEPARTMENT OF THE TREASURY is

the owner of FOUR MILLION (4,000,000) fully paid and non-assessable shares of Series D

Fixed Rate Cumulative Perpetual Preferred Stock, $5.00 par value, liquidation preference

E-I

(NY) 078651OO2ffARP/Senior.Preferred.COD.doc 11/18108 9:48 PM
$10,000 per share (the "Stock"), of the American International Group, Inc. (the "Company"),

transferable on the books of the Company by the holder hereof in person or by duly authorized

attorney upon surrender of this certificate properly endorsed.

This certificate is not valid or obligatory for any purpose unless countersigned and

registered by the Transfer Agent and Registrar.

Witness the facsimile seal of the Company and the facsimile signatures of its duly

authorized officers.

Dated: November _, 2008

Name:

Title:

(NY) 07865/002fTARP/Senior.PreferredCOD.doc

Name:

Title:

Countersigned and Registered

as Transfer Agent and Registrar

Authorized Signature

A-2

11/18/089:48 PM
AMERICAN INTERNATIONAL GROUP, INC.

AMERICAN INTERNATIONAL GROUP, INC. (the "Company") will furnish, without charge to each

stockholder who so requests, a copy of the certificate of designations establishing the powers, preferences and

relative, participating, optional or other special rights of each class of stock of the Company or series thereof and the

qualifications, limitations or restrictions of such preferences and/or rights applicable to each 'class of stock of the

Company or series thereof. Such information may be obtained by a reqiJest in writing to the Secretary of the

Company at its principal place of business.

This certificate and the share or shares represented hereby are issued and shall be held subject to all of the

provisions of the Company's Restated Certificate of Incorporation, as amended, and the Certificate of Designations

of the Series D Fixed Rate Cumulative Perpetual Preferred Stock (Liquidation Preference $10,000 per share) (copies

of which are on file with the Transfer Agent), to all of which the holder, by acceptance hereof, assents.

The following abbreviations, when used in the inscription on the face of this certificate, shall be construed

as though they were written out in full to applicable laws or regulations:

TEN COM - as tenants in common

TEN ENT - as tenants by the entireties

JT TEN - as joint tenants with right of

survivorship and not as

tenants in common

UNIF GIFT MIN ACT-Custodian

(Minor) (Cust)

under Uniform Gifts to Minors Act

(State)

Additional abbreviations may also be used though not in the above list.

For value received, -,-- hereby sell(s), assign(s) and transfer(s) unto

PLEASE INSERT SOCIAL SECURITY OR OTHER

IDENTIFYING NUMBER OF ASSIGNEE

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE

_______________________________ shares

of the capital stock represented by the within certificate, and do(es) hereby irrevocably constitute and appoint

__________, Attorney to transfer the said stock on the books of the within named Company with

full power of substitution in the premises.

A-3

(NY) 07865100ZfTARP/Senior.Prefened.COD.doc J1/18108 9:48 PM
· Dated _

Signature

NOTICE: The signature·to this assignment must correspond

with the name as written upon the face of this

certificate in every particular, without

alteration or enlargement or any change whatever.

SIGNATURE GUARANTEED

NOTICE: The signature(s) should be

guaranteed by an eligible guarantor

institution (banks, stockbrokers, savings

and loan associations, and credit unions

with membership in an approved signature

guarantee medallion program), pursuant to

Rule 17Ad- I 5 under the Securities

Exchange Act of 1934.

A-4

(NY) 078651OO2ffARP/Senior.Preferred.COD.doc J)/18108 9:48 PM
Annex B

WARRANT TO PURCHASE COMMON STOCK

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT

BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS

AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT

BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT

WHILE A REGISTRATION STATEMENT RELATING THERETO IS IN

EFFECT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES

LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION

UNDER SUCH ACT OR SUCH LAWS. THIS INSTRUMENT IS ISSUED

SUBJECT TO THE RESTRICTIONS ON TRANSFER AND OTHER

PROVISIONS OF A SECURITIES PURCHASE AGREEMENT BETWEEN

THE ISSUER OF THESE SECURITIES AND THE INVESTOR REFERRED

TO THEREIN, A COPY OF WHICH IS ON FILE WITH THE ISSUER. THE

SECURITIES REPRESENTED BY THIS INSTRUMENT MAY NOT BE SOLD

OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID

AGREEMENT. ANY SALE OR OTHER TRANSFER NOT IN COMPLIANCE

WITH SAID AGREEMENT WILL BE VOID.

WARRANT

to purchase

53,798,766

Shares of Common Stock

of AMERICAN INTERNATIONAL GROUP, INC.

Issue Date: November [ ],2008

1. Definitions. Unless the context otherwise requires, when used

herein the following terms shall have the meanings indicated.

"Affiliate" has the meaning ascribed to it in the Purchase Agreement.

"Appraisal Procedure" means a procedure whereby two independent

appraisers, one chosen by the Company and one by the Original Warrantholder,

shall mutually agree upon the determinations then the subject of appraisal. Each

party shall deliver a notice to the other appointing its appraiser within 15 days

after the Appraisal Procedure is invoked. If within 30 days after appointment of

the two appraisers they are unable to agree upon the amount in question, a third

independent appraiser shall be chosen within 10 days thereafter by the mutual

consent of such first two appraisers. The decision of the third appraiser so

appointed and chosen shall be given within 30 days after the selection of such

third appraiser. If three appraisers shall be appointed and the determination of one

appraiser is disparate from the middle determination by more than twice the

amount by which the other determination is disparate from the middle

determination, then the determination of such appraiser shall be excluded, the

(NY) 078651OO2rrARP/AIG.warral1l.doc J1/) 8108 9:30 PM
remaining two determinations shall be averaged and such average shall be binding

and conclusive upon the Company and the Original Warrantholder; otherwise, the

average of all three determinations shall be binding upon the Company and the

Original Warrantholder. The costs of conducting any Appraisal Procedure shall be

borne by the Company.

"Board ofDirectors" means the board of directors of the Company,

including any duly authorized committee thereof.

. "Business Combination" means a merger, consolidation, statutory share

exchange or similar transaction that requires the approval of the Company's

stockholders.

"business day" means any day except Saturday, Sunday and any day on

which banking institutions in the State of New York generally are authorized or

required by law or other governmental actions to close.

"Capital Stock" means (A) with respect to any Person that is a corporation

or company, any and all shares, interests, participations or other equivalents

(however designated) of capital or capital stock of such Person and (B) with

respect to any Person that is not a corporation or company, any and all paItnership

or other equity interests ofsuch Person.

"Charter" means, with respect to any Person, its ceItificate or articles of

incorporation, articles of association, or similar organizational document.

"Charter Amendment" means the amendments to the Company's Restated

Certificate of Incorporation to reduce the par value of the Common Stock to

$0.000001 per share and increase the number of authorized shares of Common

Stock to 19 billion.

"Common Stock" has the meaning ascribed to it in the Purchase

Agreement.

"Company" means the American International Group, Inc.

"conversion" has the meaning set foIth in Section B(C).

"convertible securities" has the meaning set forth in Section l3(e).

"Exchange Act" means the Securities Exchange Act of 1934, as amended,

or any successor statute, and the rules and regulations promulgated thereunder.

"Exercise Price" means, with respect to this Warrant, initially, $2.50, and

upon the effectiveness of the Charter Amendment, the amended par value per

share of Common Stock.

"Expiration Time" has the meaning set forth in Section 3.

2

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"Fair Market Value" means, with respect to any security or other prope11y,

the fair market value ofsuch security or other property as determined by the

Board of Directors, acting in good faith or, with respect to Section 14, as

determined by the Original Warrantholder acting in good faith. For so long as the

Original Warrantholder holds this Warrant or any portion thereof, it may object in

writing to the Board of Director's calculation of fair market value within 10 days

of receipt of written notice thereof. If the Original Wanantholder and the

Company are unable to agree on fair market value during the 10-day period

following the delivery of the Original Warrantholder's objection, the Appraisal

Procedure may be invoked by either party to determine Fair Market Value by

delivering written notification thereof not later than the 30th day after delivery of

the Original Warrantholder's objection.

"Governmental Entities" has the meaning ascribed to it in the Purchase

Agreement.

"Initial Number" has the meaning set forth in Section 13(C).

"Issue Date" means November [ ],2008.

"Market Price" means, with respect to a particular security, on any given

day, the last reported sale price regular way or, in case no such repolted sale takes

place on such day, the average of the last closing bid and ask prices regular way,

in either case on the principal national securities exchange on which the

applicable securities are listed or admitted to trading, or if not listed or admitted to

trading on any national securities exchange, the average of the closing bid and ask

prices as furnished by two members of the Financial Industry Regulatory

Authority, Inc. selected from time to time by the Company for that purpose.

"Market Price" shall be determined without reference to after hours or extended

hours trading. If such security is not listed and traded in a manner that the

quotations referred to above are available for the period required hereunder, the

Market Price per share of Common Stock shall be deemed to be (i) in the event

that any portion of the Warrant is held by the Original Warrantholder, the fair

market value per share of such security as determined in good faith by the

Original Warrantholder or (ii) in all other circumstances, the fair market value per

share of such security as determined in good faith by the Board of Directors in

reliance on an opinion of a nationally recognized independent investment banking

corporation retained by the Company for this purpose and certified in a resolution

to the Warrantholder. For the purposes of determining the Market Price of the

Common Stock on the "trading day" preceding, on or following the occurrence of

an event, (i) that trading day shall be deemed to commence immediately after the

regular scheduled closing time of trading on the New York Stock Exchange or, if

trading is closed at an earlier time, such earlier time and (ii) that trading day shall

end at the next regular scheduled closing time, or if trading is closed at an earlier

time, such earlier time (for the avoidance of doubt, and as an example, if the

Market Price is to be determined as of the last trading day preceding a specified

event and the closing time of trading on a pat1icular day is 4:00 p.m. and the

3

(NY) 078651OO2frARPIAIG.warrant.doc 11/181089:30 PM
specified event occurs at 5:00 p.m. on that day, the Market Price would be

detelmined by reference to such 4:00 p.m. closing price).

"Original Warrantholder" means the United States Depmtment of the

Treasury. Any actions specified to be taken by the Original Warrantholder

hereunder may only be taken by such Person and not by any other WalTantholder.

"Permitted Transactions" has the meaning set forth in Section 13(C).

"Person" has the meaning given to it in Section 3(a)(9) of the Exchange

Act and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act.

"Per Share Fair Market Value" has the meaning set forth in Section 13(D).

"Preferred Shares" means the perpetual prefel1"ed stock issued to the

Original Warrantholder on the Issue Date pursuant to the Purchase Agreement.

"Pro Rata Repurchases" means any purchase of shares of Common Stock

by the Company or any subsidiary thereof pursuant to (A) any tender offer or

exchange offer subject to Section 13(e) or 14(e) of the Exchange Act or

Regulation 14E promulgated thereunder or (B) any other offer available to

substantially all holders of Common Stock, in the case of both (A) or (B), whether

for cash, shares of Capital Stock of the Company, other securities of the Company,

evidences of indebtedness of the Company or any other Person or any other

property (including, without limitation, shares of Capital Stock, other securities or

evidences of indebtedness of a subsidiary), or any combination thereof, effected .

while this Warrant is outstanding. The "EffectiveDate" of a Pro Rata Repurchase

shall mean the date of acceptance ofshares for purchase or exchange by the

Company under any tender or exchange offer which is a Pro Rata Repurchase or

the date of purchase with respect to any Pro Rata Repurchase that is not a tender

or exchange offer.

"Purchase Agreement" means the Securities Purchase Agreement, dated

as of November [ ], 2008, as amended from time to time, between the Company

and the United States Department of the Treasury, inclu~ing all annexes and

schedules thereto.

"Regulatory Approvals" with respect to the WalTantholder, means, to the

extent applicable and required to permit the WalTantholder to exercise this

Warrant for shares of Common Stock and to own such Common Stock without

the Warrantholder being in violation of applicable law, rule or regulation, the

receipt of any necessary approvals and authorizations of, filings and registrations

with, notifications to, or expiration or termination of any applicable waiting

period under, the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as

amended, and the rules and regulations thereunder.

"SEC' means the U.S. Securities and Exchange Commission.

4

(NY) 07865JOO2rrARP/AIG.warram.doc 111181089:30 PM
"Securities Act" means the Securities Act of 1933, as amended, or any

successor statute, and the rules and regulations promulgated thereunder.

"Shares" has the meaning set forth in Section 2.

"trading day" means (A) if the shares of Common Stock are not traded on

any national or regional securities exchange or association or over-the-counter

market, a business day or (B) if the shares of Common Stock are traded on any

national or regional securities exchange or association or over-the-counter market,

a business day on which such relevant exchange or quotation system is scheduled

to be open for business and on which the shares of Common Stock (i) are not

suspended from trading on any national or regional securities exchange or

association or over-the-counter market for any period or periods aggregating ·one

half hour or longer; and (ii) have traded at least once on the national or regional

securities exchange or association or over-the-counter market that is the primary

market for the trading of the shares of Common Stock. .

"u.s. GAAP" means United States generally accepted accounting

principles.

"Warrantholder" has the meaning set forth in Section 2.

"Warrant" means this Wan-ant, issued pursuant to the Purchase

Agreement.

2. Number of Shares; Exercise Price. This certifies that, for value

received, the United States Department of the Treasury or its permitted assigns

(the "Warrantholder") is entitled, upon the terms and subject to the conditions

hereinafter set forth, to acquire from the Company, in whole or in part, after the

receipt of all applicable Regulatory Approvals, if any, up to an aggregate of

53,798,766 fully paid and nonassessable shares of Common Stock, at a purchase

price per share of Common Stock equal to the Exercise Price. The number of

shares of Common Stock (the "Shares") and the Exercise Price are subject to·

adjustment as provided herein, and all references to "Common Stock," "Shares"

and "Exercise Price" herein shall be deemed to include any such adjustment or

series of adjustments.

3. Exercise of Warrant; Term. Subject to Section 2, to the extent

permitted by applicable laws and regulations, the right to purchase the Shares

represented by this Warrant is exercisable, in whole or in part by the

Warrantholder, at any time or from time to time after the execution and delivery

of this Warrant by the Company on the date hereof, but in no event later than 5:00

p.m., New York City time on the tenth anniversary of the Issue Date (the

"Expiration Time"), by (A) the surrender of this Warrant and Notice of Exercise

annexed hereto, duly completed and executed on behalf of the Warrantholder, at

the principal executive office of the Company located at 70 Pine Street, New

York, New York 10270 Attention: Chief Financial Officer (or such other office or

5

(NY) 078651OO2fTARP/AIG.wamllJ1.doc 11/181089:30 PM
agency of the Company in the United States as it may designate by notice in

writing to the Warrantholder at the address of the Warrantholder appearing on the

books of the Company), and (B) payment of the Exercise Price for the Shares

thereby purchased:

(i) by having the Company withhold, from the shares of Common

Stock that would otherwise be delivered to the Warrantholder upon such exercise,

shares of Common Stock issuable upon exercise of the Warrant equal in value to

the aggregate Exercise Price as to which this Warrant is so exercised based on the

Market Price of the Common Stock on the trading day on which this Warrant is

exercised and the Notice of Exercise is delivered to the Company pursuant to this

Section 3, or

(ii) with the consent of both the Company and the Warrantholder, by

tendering in cash, by certified or cashier's check payable to the order of the

Company, or by wire transfer of immediately available funds to an account

designated by the Company.

If the Warrantholder does not exercise this Warrant in its entirety, the

Warrantholder will be entitled to receive from the Company within a reasonable

time, and in any event not exceeding three business days, a new warrant in

substantially identical form for the purchase of that number of Shares equal to the

difference between the number of Shares subject to this Warrarit and the number

of Shares as towhich this Warrant is so exercised. Notwithstanding anything in

this Warrant to the contrary, the Warrantholder hereby acknowledges and agrees

that its exercise of this Warrant for Shares is subject to the condition that the

Wanantholder will have first received any applicable Regulatory Approvals.

4. Issuance of Shares; Authorization; Listing. Book-entries

representing Shares issued upon exercise of this Warrant will be promptly

recorded in such name or names as the Warrantholder may designate. The

Company hereby represents and warrants that any Shares issued upon the exercise

of this Warrant in accordance with the provisions of Section 3 will be duly and

validly authorized and issued, fully paid and nonassessable and free from all taxes,

liens and charges (other than liens or charges createdby the Warrantholder,

income and franchise taxes incurred in connection with the exercise of the

Wanant or taxes in respect of any transfer occuning contemporaneously

therewith). The Company agrees that the Shares so issued will be deemed to have

been issued to the Wanantholder as of the close of business on the date on which

this Warrant and payment of the Exercise Price are delivered to the Company in

accordance with the terms of this Warrant, notwithstanding that the stock transfer

books of the Company may then be closed. The Company will at all times reserve

and keep available, out of its authorized but unissued Common Stock, solely for

the purpose of providing for the exercise of this Warrant, the aggregate number of

shares of Common Stock then issuable upon exercise of this Warrant at any time.

The Company will (A) procure, at its sole expense, the listing of the Shares

issuable upon exercise of this Warrant at any time, subject to issuance or notice of

6

(NY) 078651OO2ffARP/AIG.warranl.doc 1I1J8/08 9:30 PM
issuance, on all principal stock exchanges on which the Common Stock is then

listed or traded and (B) maintain such listings of such Shares at all times after

issuance. The Company will use reasonable best efforts to ensure that the Shares

may be issued without violation of any applicable law or regulation or of any

requirement of any securities exchange on which the Shares are listed or traded.

5. No Fractional Shares or Scrip. No fractional Shares or scrip

representing fractional Shares shall be issued upon any exercise of this,Warrant.

In lieu of any fractional Share to which the Warrantholder would otherwise be

. entitled, the Warrantholder shall be entitled to receive a cash payment equal to the

Market Price of the Common Stock on the last trading day preceding the date of

exercise less the pro-rated Exercise Price for such fractional share.

6. No Rights as Stockholders; Transfer Books. This Warrant does not

entitle the Warrantholder to any voting rights or other rights as a stockholder of

the Company prior to the date of exercise hereof. The Company win at no time

close its transfer books against transfer of this Warrant in any manner which '

interferes with the timely exercise of this Warrant.

7. Charges, Taxes and Expenses. Issuance of Shares to the

Warrantholder upon the exercise of this Warrant shall be made without charge to .

the Warrantholder for any issue. or transfer tax or other incidental expense in

respect of the issuance of.such Shares, all of which taxes and expenses shall be

paid by the Company.

8.' Transfer/Assignment.

(A) Subject to compliance with clause (B) of this Section 8, this

Warrant and all rights hereunder are transferable, in whole or in part, upon the

books of the Company by the registered holder hereof in person or by duly

authorized attorney, and a new warrant shall be made and delivered by the

Company, of the same tenor and date as this Warrant but registered in the name of

one or more transferees, upon surrender of this Warrant, duly endorsed, to the

office or agency of the Company described in Section 3. All expenses (other than

stock transfer taxes) and other charges payable in connection with the preparation,

execution and delivery of the new warrants pursuant to this Section 8 shall be paid

by the Company.

(B) The transfer of the Warrant and the Shares issued upon exercise of

the Warrant are subject to the restrictions set forth in Section 4.4 oftbe Purchase

Agreement. If and for so long as required by the Purchase Agreement, this

Warrant shall contain the legends as set forth in Section 4.2(a) of the Purchase

Agreement.

9. Exchange and Registry of WalTant. This Warrant is exchangeable,

upon the surrender hereof by the Warrantholder to the Company, for a new

warrant or warrants of like tenor and representing the right to purchase the same

7

(NY) 078651OO2ffARP/A1G.warranl.doc 11/181089:30 PM
aggregate number of Shares. The Company shall maintain a registry showing the

name and address of the Warrantholder as the registered holder of this Warrant.

This Warrant may be surrendered for exchange or exerCise in accordance with its

terms, at the office of the Company, and the Company shall be entitled to rely in

all respects, prior to written notice to the contrary, upon such registry.

10. -Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by.

the Company of evidence reasonably satisfactory to it of the loss, theft,

destruction or mutilation of this Warrant, and in the case of any such loss, theft or

destruction, upon receipt of a bond, indemnity or security reasonably satisfactory

to the Company, or, in the case of any such mutilation, upon surrender and

cancellation of this Warrant, the Company shall make and deliver, in lieu of such

lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and

representing the right to purchase the same aggregate number of Shares as

provided for in such lost, stolen, destroyed or mutilated Warrant. .

11. Saturdays, Sundays, Holidays,'etc. Ifthe last or appointed day for

the taking of any action or the expiration of any right required or granted herein

shall not be a business day, then such action may be taken or such right may be

exercised on the next succeeding day that is a business day.

12. Rule 144 Information. The Company covenants that it will use its

reasonable best efforts to timely file all reports and other documents required to

be filed by it under the Securities Act and the Exchange Act and the rules and

regulations promulgated by the SEC thereunder (or, if the Company is not

required to file such reports, it will, upon the request of any Warrantholder, make

publicly available such information as necessary to permit sales pursuant to Rule

144 under the Securities Act), and it will use reasonable best efforts to take such

further action as any Warrantholder may reasonably request, in each case to the

extent required from time to time to enable such holder to, if pelmitted by the

terms of this Warrant and the Purchase Agreement, sell this Warrant without

registration under the Securities Act within the limitation of the exemptions

provided by (A) Rule 144 under the Securities Act, as such rule may be amended

from time to time, or (B) any successor rule or regulation hereafter adopted by the

SEC. Upon the written request of any Warrantholder, the Company will deliver to

such Warrantholder a written statement that it has complied with such

requirements.

13. Adjustments and Other Rights. The Exercise Price and the number·

of Shares issuable upon exercise of this Warrant shall be subject to adjustment

from time to time as follows; provided, that if more than one subsection of this

Section 13 is applicable to a single event, the subsection shall be applied that

produces the largest adjustment and no single event shall cause an adjustment

under more than one subsection of this Section 13so as to result in duplication:

8

(NY) 07865100zrrARP/AIG.warranl.doc JJIJ8108 9:30 PM
(A) Charter Amendment. Upon the effectiveness of the Charter

Amendment, the Exercise Price shall be adjusted from its initial value of$2.50 to

.the· amended par value per share of Common Stock.

(B) Stock Splits, Subdivisions, Reclassifications or Combinations. If

the Company shall (i) declare and pay a dividend or make a distribution on its

Common Stock in shares of Common Stock, (ii) subdivide or reclassify the

outstanding shares of Common Stock into a greater number of shares, or (iii)

combine or reclassify the o"tstanding shares of Common Stock into a smaller

number of shares, the number of Shat:es issuable upon exercise of this Warrant at

the time ofth~ record date for such dividend or distribution or the effective date

of such subdivision, combination or reclassification shall be proportionately

adjusted so that the Warrantholder after such date shall be entitled to purchase the

number of shares of Common Stock which such holder would have owned or

been entitled to receive in respect of the shares of Common Stock subject to this

Warrant after such date had this Warrant been exercised immediately prior to such

date. In such event, the Exercise Price in effect at the time of the record date for

such dividend or distribution or the effective date of such subdivision,

combination or reclassification shall be adjusted to the number obtained by

dividing (x) the product of (1) the number of Shares issuable upon the e~ercise of

this Warrant before such adjustment and (2) the Exercise Price in effect

immediately prior to the record or effective date, as the case may be, for the

dividend, distribution, subdivision, combination or reclassification giving rise to

this adjustment by (y) the new number of Shares issuable upon exercise of the

Warrant determined pursuant to the immediately preceding sentence:

(C) Certain Issuances of Common Shares or Convertible Securities.

.Until the earlier of (i) the date on which the Original Warrantholder no longer

holds this Warrant or any portion thereof and (ii) the third anniversary of the Issue

Date, if the Company shall issue shares of Common Stock (or rights or warrants

or other securities exercisable or convertible into or exchangeable (collectively, a

"conversion") for shares of Common Stock) (coiIectively, "convertible securities")

(other than in Permitted Transactions (as defined below) or a transaction to which

subsection (B) of this Section 13 is applicable) without consideration or at a

consideration per share (or having a conversion price per share) that is less than

90% of the Market Price on the last trading day preceding the date of the

agreement on pricing such shares (or such convertible securities) then, in such

event:

(A) the number of Shares issuable upon the exercise of this Warrant

immediately prior to the date of the agreement on pricing of such shares

(or of such convertible secUlities) (the "Initial Number") shall be increased

to the number obtained by multiplying the Initial Number by a fraction (A)

the numerator of which shall be the sum of (x) the number of shares of

Common Stock of the Company outstanding on such date and (y) the

number of additional shares of Common Stock issued (or into which

convertible securities may be exercised or convert) and (B) the

9

(NY) 078651OO2rrARP/AIG.warranl.doc I JlJ8108 9:30 PM
denominator of which shall be the sum of (1) the number of shares of

Common Stock outstanding on such date and (II) the number of shares of

Common Stock which the aggregate consideration receivable by the

Company for the total number of shares of Common Stock so issued (or

into which convertible securities may be exercised or convert) would

purchase at the Market Price on the last trading day preceding the date of

the agreement on pricing such shares (or such convertible securities); and

(B) the Exercise Price payable upon exercise of the Wan-ant shall be

adjusted by multiplying such Exercise Price in effect immediately prior to

the date of the agreement on pricing of such shares (or of such convertible

securities) by a fraction, the numerator of which shall be the number of

shares of Common Stock issuable upon exercise of this Wan-ant prior to

such date and the denominator of which shall be the number ofshares of

Common Stock issuable upon exercise of this Warrant immediately after

the adjustment described in clause (A) above.

For purposes of the foregoing, the aggregate consideration receivable by

the Company in connection with the issuance of such shares of Common Stock or

conyertible securities shall be deemed to be equal to the sum of the net offering

price (including the Fair Market Value of any non-cash consideration and after

deduction of any related expenses payable to third parties) of all such securities

plus the minimum aggregate amount, if any, payable upon exercise or conversion

of any such convertible securities into shares of Common Stock; and "Permitted

Transactions" shall mean issuances (i) as consideration for or to fund the

acquisition of businesses andlor related assets, (ii) in connection with employee

benefit plans and compensation related arrangements in the ordinary course and'

consistent with past practice approved by the Board of Directors, (iii) in

connection with a public or broadly marketed offering and sale of Common Stock

or convertible securities for cash conducted by the Company or its affiliates

pursuallt to registration under the Securities Act or Rule 144A thereunder on a

basis consistent with capital raising transactions by comparable financial

institutions and (iv) in connection with the exercise of preemptive rights on terms

existing as ofthe Issue Date. Any adjustment made pursuant to this Section 13(C)

shall become effective immediately upon the date of such issuance.

(D) Other Distributions. In case the Company shall fix a record date for

the making of a distribution to all holders of shares of its Common Stock of

securities, evidences of indebtedness, assets, cash, rights or warrants (excluding

dividends of its Common Stock and other dividends or distributions referred to in

Section 13(B)), in each such case, the Exercise Price in effect prior to such record

date shall be reduced immediately thereafter to the price determined by

multiplying the Exercise Price in effect immediately prior to the reduction by the

quotient of (x) the Market Price of the Common Stock on the last trading day

preceding the first date on which the Common Stock trades regular wayan the

principal national securities exchange on which the Common Stock is listed or

admitted to trading without the right to receive such distribution, minus the

10

(NY) 078651OO2fTARP/AIG,w8rranl.doc IIII 8108 9:30 PM
amount of cash andlor the Fair Market Value of the securities, evidences of

indebtedness, assets, rights or warrants to be so distributed in respect of one share

of Common Stock (such amount andlor Fair Market Value, the "Per Share Fair

Market Value") divided by (y) such Market Price on such date specified in clause

(x); such adjustment shall be made successively whenever such a record date is

fixed. In such event, the number of Shares issuable upon the exercise of this

Warrant shall be increased to the number obtained by dividing (x) the product of

(1) the number of Shares issuable upon the exercise of this Wan-ant before such

adjustment, and (2) the Exercise Price in effect immediately prior to the

distribution giving rise to this adjustment by (y) the new Exercise Price

determined in accordance with the immediately preceding·sentence. In the event

that such distribution is not so made, the Exercise Price and the number of Shares

issuable upon exercise of this Warrant then in effect shall be readjusted, effective

as of the date when the Board of Directors determines not to distribute such shares,

evidences of indebtedness, assets, rights, cash or warrants, as the case may be, to

the Exercise Price that would then be in effect and the number of Shares that

would then be issuable upon exercise of this Warrant if such record date had not

been fixed.

(E) Certain Repurchases of Common Stock. In case the Company

effects a Pro Rata Repurchase of Common Stock, then the Exercise Price shall be

reduced to the price determined by multiplying the Exercise Price in effect

immediately prior to the Effective Date of such Pro Rata Repurchase by a fraction

of which the numerator shall be (i) the product of (x) the immber of shares of .

Common Stock outstanding immediately before such Pro Rata Repurchase and (y)

the Market Price of a share of Common Stock on the trading day immediately .

preceding the first public announcement by the Company or any of its Affiliates

of the intent to effect such Pro Rata Repurchase, minus (ii) the aggregate purchase

price of the Pro Rata Repurchase, and of which the denominator shall be the

product of (i) the number of shares of Common Stock outstanding immediately

prior to such Pro Rata Repurchase minus the number of shares of Common Stock

so repurchased and (ii) the Market Price per share of Common Stock on the

trading day immediately preceding the first public announcement by the Company

or any of its Affiliates of the intent to effect such Pro Rata Repurchase. In such

event, the number of shares of Common Stock issuable upon the exercise of this

Warrant shall be increased to the number obtained by dividing (x) the product of

(1) the number of Shares issuable upon the exercise of this Warrant before such

adjustment, and (2) the Exercise Price in effect immediately prior to the Pro Rata

Repurchase giving rise to this adjustment by (y) the new Exercise Price

determined in accordance with the immediately preceding sentence. For the

avoidance of doubt, no increase to the Exercise Price or decrease in the number of

Shares issuable upon exercise of this Warrant shall be made pursuant to this

Section 13(E).

(F) Business Combinations. In case of any Business Combination or

reclassification of Common Stock (other than a reclassification of Common Stock

11

(NY) 07865JOO2fTARPIAIG.wamml.doc 111181089:30 PM
referred to in Section 13(B», the Warrantholder's right to receive Shares upon

exercise of this Warrant shall be converted into the right to exercise this Warrant

to acquire the number of shares of stock or other securities or property (including

cash) which the Common Stock issuable (at the time of such Business

Combination or reclassification) upon exercise of this Warrant immediately prior

to such Business Combination or reclassification would have been entitled to

receive upon consummation of such Business Combination or reclassification;

and in any such case, if necessary, the provisions set forth herein with respect to

the rights and interests thereafter of the Warrantholder shall be appropriately

adjusted so as to be applicable, as nearly as may reasonably be, to the

Warrantholder's right to exercise this Warrant in exchange for any shares ofstock

or other securities or property pursuant to this paragraph. In determining the kind

and amount of stock, securities or the property receivable upon exercise of this

Warrant following the consummation of such Business Combination, if the

holders of Common Stock have the right to elect the kind or amount of

consideration receivable upon consummation of such Business Combination, then

the consideration that the Warrantholder shall be entitled to receive upon exercise

shall be deemed to be the types and amounts of consideration received by the

majority of all holders of the shares of Common Stock that affirmatively make an

election (or of all such holders if none make an election).

(G) Rounding of Calculations; Minimum Adjustments. All calculations

under this Section 13 shall be made to the nearest one-tenth (1/10th) of a cent or

to the nearest one-hundredth (lIlOOth) of a share, as the case may be. Any

provision of this Section 13 to the contrary notwithstanding, no adjustment in the

Exercise Price or the number of Shares into which this W8lTant is exercisable

shall be made if the amount of such adjustment would be less than $0.01 or onetenth (1/1Oth) of a share of Common Stock, but any such amount shall be carried

forward and an adjustment with respect thereto shall be made at the time of and

together with any subsequent adjustment which, together with such amount and

any other amount or amounts so calTied forward, shall aggregate $0.01 or'l1l0th

of a share of Common Stock, or more.

(H) Timing of Issuance of Additional Common Stock Upon Certain

Adjustments. In any case in which the provisions of this Section 13 shall require

that an adjustment shall become effective immediately after a record date for an

event, the Company may defer until the occurrence of such event (i) issuing to the

Warrantholder of this Warrant exercised after such record date and before the

occurrence of such event the additional shares of Common Stock issuable upon

such exercise by reason of the adjustment required by such event over and above

,the shares of Common Stock issuable upon such exercise before giving effect to

such adjustment and (ii) paying to such Warrantholder any amount of cash in lieu

of a fractional share of Common Stock; provided, however, that the Company

upon request shall deliver to such Warrantholder a due bill or other appropriate

instrument evidencing such Warrantholder's right to receive such additional

shares, and such cash, upon the occurrence of the event requiring such adjustment.

12

(NY) 078651OO2ffARP/AIG.warrall\.doc 11118/089:30 PM
· (1) Other Events. For so long as the Original Warrantholder holds this

Warrant or any portion thereof, if any event occurs as to which the provisions of

this Section 13 are not strictly applicable or, if strictly applicable, would not, in

the good faith judgment of the Board of Directors of the Company, fairly and

adequately protect the purchase rights of the Warrants in accordance with the

essential intent and principles of such provisions, then the Board of Directors

shall make such adjustments in the application of such provisions, in accordance

with such essential intent and principles, as shall be reasonably necessary, in the

good faith opinion of the Board of Directors, to protect stich purchase rights as

aforesaid. The Exercise Price and the number of Shares into which this Warrant is

exercisable shall not be adjusted in the event of a change in the par value of the

Common Stock (other than pursuant to the Charter Amendment) or a change in

the jurisdiction of incorporation·of the Company.

(1) Statement Regarding Adjustments. Whenever the Exercise Price or

the number of Shares into which this·Warrant is exercisable shall be adjusted as

provided in Section 13,.~e Company shall forthwith file at the principal office of

the Company a statement showing in reasonable detail the facts requiring such

adjustment and the Exercise Price that shall be in effect and the number of Shares

into which this Warrant shall be exercisable after such adjustment, and the

Company shall also cause a copy of such statement to be sent by mail, first class

postage prepaid, to each WalTantholder at the address appearing in the Company's

records.

(K) Notice of Adjustment Event. In the event that the Company shall

propose to take any action of the type described in this Section 13 (but only if the

action of the type described in this Section 13 would result in an adjustment in the

Exercise Price or the number of Shares into which this WalTant is exercisable or a

change in the type of securities or property to be delivered upon exercise of this

Warrant), the Company shall give notice to the Warrantholder, in the manner set

forth in Section 13(1), which notice shall specify the record date, ifany, with

respect to any such action and the approximate date on which such action is to

take place. Such notice shall also set forth the facts with respect thereto as shall be

reasonably necessary to indicate the effect on the Exercise Price and.the number,

kind or class of shares or other securities or property which shall be deliverable

upon exercise of this Warrant. In the case of any action which would require the

fixing of a record date, such notice shall be given at least 10 days prior to the date

so fixed, and in case of all other action, such notice shall be given at least 15 days

prior to the taking ofsuch proposed action. Failure to give such notice, or any

defect therein, shall not affect the legality or validity of any such action.

(L) Proceedings Prior to Any Action Requiring Adjustment. As a

condition precedent to the taking of any· action which would require an adjustment

pursuant to this Section 13, the Company shall take any action which may be

necessary, including obtaining regulatory, New York Stock Exchange or

stockholder approvals or exemptions, in order that the Company may thereafter

validly and legally issue as fully paid and nonassessable all shares of Common

13

(NY) 078651OO2ffARP/AIG.warranl.doc JJIJ8108 9:30 PM
Stock that the Warrantholder is entitled to receive upon exercise of this Warrant

pursuant to this Section 13.

(M) Adjustment Rules. Any adjustments pursuant to this Section 13

shall be made successively whenever an event referred to herein shall occur. If an

adjustment in Exercise Price made hereunder would reduce the Exercise Price to

an amount below par value of the Common Stock, then such adjustment in

Exercise Price made hereunder shall reduce the Exercise Price to the par value of

the Common Stock.

14. Exchange. At any time following the date on which the shares of

Common Stock of the Company are no·longer. listed or admitted to trading on a

national securities exchange (other than in connection with any Business

Combination), the Original Warrantholder may cause the Company to exchange

all or a portion of this Warrant for an economic interest (to be determined by the

Original Warrantholder after consultation with the Company) of the-Company

classified as permanent equity under U.S. GAAP having a value equal to the Fair

Market Value of the portion of the Warrant so exchanged. The Original

WarrantholdeI; shall calculate any Fair Market Value required to be calculated

. pursuant to this Section 14, which shall not be subject to the Appraisal Procedure.

15. No Impairment. The Company will not, by amendment of its

Charter or through any reorganization, transfer of assets, consolidation, merger,

dissolution, issue or sale of securities or any other voluntary action, avoid or seek

to avoid the observance or performance of any of the terms to be observed or

performed hereunder by the Company, but will at all times in good faith assist in

the canying out of all the provisions of this Warrant and in taking of all such

action as may be necessary or appropriate in order to protect the rights of the

Warrantholder.

16. Governing Law. This Warrant, and the rights and obligations

ofthe parties hereunder, shall be governed by, and construed and

interpreted in accordance with, United States federal law and not the law of

any State. To the extent that a court looks to the laws of any State to

determine or define the United States federal law, it is the intention of the

parties hereto that such court shall look only to the laws of the State of New

York without regard to the rules of conflicts of laws. Each of the Company

and the Warrantholder agrees (a) to submit to the exclusive jurisdiction and

venue of the United States District Court for the District of Columbia for any

action, suit or proceeding arising out of or relating to this Warrant or the

transactions contemplated hereby, and (b) that notice may be served upon

the Company at the address in Section 20 below and upon the

Warrantholder at the address for the Warrantholder set forth in the registry

maintained by the Company pursuant to Section 9 hereof. To the extent

permitted by applicable law, each of the Company and the Warrantholder

hereby unconditionally waives trial by jury in any legal action or proceeding

relating to the Warrant or the transactions contemplated hereby or thereby.

14

(NY) 078651OO2fTARP/AIG.warront.doc 11118/089:30 PM
. 17. Binding Effect. This Warrant shall be binding upon any successors

or assigns of the Company.

18. Amendments. This Warrant may be amended and the observance

of any term of this Warrant may be waived only with the written consent of the

Company and the Warrantholder.

19. Prohibited Actions. The Company agrees that it will not take any

action which would entitle the Warrantholder to an adjustment of the Exercise

Price if the total number of shares of Common Stock issuable after such action

upon exercise of this Warrant, together with all shares of Common Stock then

outstanding and all shares of Common Stock then issuable upon the exercise of all

outstanding options, warrants, conversion and other rights, would exceed the total

number of shares of Common Stock then authorized by its Charter.

20. Notices. Any notice, request, instruction or other document to be

given hereunder by any party to the other will be in writing and will be deemed to

have been duly given (a) on the date of delivery if delivered personally, or by

facsimile, upon confirmation of receipt, or (b) on the second business day

. following the date of di~patch if delivered by a recognized next day courier

service. All notices hereunder shall be delivered as set forth below, or pursuant to

such other instructions as may be designated in writing by the party to receive

such notice.

If to the Company:

American International Group, Inc.

70 Pine Street

New York, New York 10270

Attention: Chief Financial Officer:

Secretary:

Treasurer:

with a copy to:

Sullivan & Cromwell LLP

125 Broad Street

New York, NY 10004

Attention Robert W. Reeder, III

Michael M. Wiseman

If to the Warrantholder:

United States Department of the Treasury

1500 Pennsylvania Avenue, NW, Room 2312

Washington, D.C. 20220

15

(NY) 07865/o02rrARP/AIG.warranl.doc II/J8/08 9:30 PM
Attention: Assistant General Counsel (Banking and Finance)

Facsimile: (202) 622-1974

with a copy to:

Davis Polk & Wardwell

450 Lexington Avenue

New York, NY 10017

Attention: John Brandow

21. Entire Agreement. This Warrant contains the entire agreement

between the parties with respect to the subject matter hereof and supersede all

prior and contemporaneous arrangements or undertakings with respect thereto.

[Remainder ofpage intentionally left blank]

16

(NY) 078651OO2!fARPIAIG.wan-aat.do< 111181089:30 PM
[Form of Notice of Exercise]

Date: _

TO: American International Group, Inc.

RE: Election to Purchase Common Stock

The undersigned, pursuant to the provisions set forth in the attached

Warrant, hereby agrees to subscribe for and purchase the number of shares of the

Common Stock'set forth below covered by such WalTant. The undersigned, in

accordance with Section 3 of the Warrant, hereby agrees to pay the aggregate

Exercise Price for such shares of Common Stock in the manner set forth below. A

new warrant evidencing the remaining shares of Common Stock covered by such

Warrant, but not yet subscribed for and purchased, if any, should be issued in the

name set forth below.

Number of Shares of Common Stock _

Method of Payment of Exercise Price (note if cashless exercise pursuant to

Section 3(i) of the Warrant or cash exercise pursuant to Section 3(ii) of the

Warrant, with consent of the Company and the Wan'antholder) _

Aggregate Exercise Price:

Holder:

By:

Name:

Title:

(NY) 07865100YTARP/AIG.warrallt.doc 11/181089:30 PM
IN WITNESS WHEREOF, the Company has caused this Warrant to be

duly executed by a duly authorized officer.

Dated: November _. 2008

AMERICAN INTERNATIONAL

GROUP, INC.

By:

Name:

Title:

Attest:

By:

Name:

Title:

[Signature Page to Warrant]

(NY) 078651002ffARP/AIG.warral1t.doc 111181089:30 PM

Annex C

SERlES D FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK

($10,000 LIQUIDATION PREFERENCE)

NUMBER

1

SHARES

4,000,000

CUSIP 026874 818

~~.n INTERNATIONAL GROUP, INC.

. . NDER THE LAWS OF THE STATE OF DELAWARE

..:;~~~~fHIS CERTIFICATE IS TRANSFERABLE

.'.1> ~:ttTHE .~

CITY OF SOUTH ST. PAUL, MINNESOTA

T·· ITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN

REGI RED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE

"SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE AND MAY

NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE

A REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER

SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO

AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS.

EACH PURCHASER OF THE SECURITIES REPRESENTED BY THIS

INSTRUMENT IS NOTIFIED THAT THE SELLER MAY BE RELYING ON THE

EXEMPTION FROM SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE

144A THEREUNDER. ANY TRANSFEREE OF THE SECURITIES£EPRESENTED

BY THIS INSTRUMENT BY ITS ACCEPTANCE HEREOF (1).J~,ltSMsENTS THAT

IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEF~~~LE 144A

UNDER THE SECURITIES ACT), (2) AGREES THAT I~ '.;P,;~~OFFER, SELL

OR OTHERWISE TRANSFER THE SECURITIES . . ." BY THIS

INSTRUMENT EXCEPT (A) PURSUANT TO A' ON STATEMENT

WHICH IS THEN EFFECTIVE UNDER THE ,ACT, (B) FOR SO LONG

AS THE SECURITIES REPRESENTED BY T '.: T UMENT ARE ELIGffiLE

FOR RESALE PURSUANT TO RULE 144A, TO RSON IT REASONABLY

BELIEVES IS A "QUALIFIED INSTITUTIONAL"~UYER"AS DEFINED IN RULE

144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN

ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER

TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN

RELIANCE ON RULE 144A, (C) TO THE ISSUER OR (D) PURSUANT TO ANY

OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION

REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL

GIVE TO EACH PERSON TO WHOM THE SECURITIES REPRESENTED BY THIS

INSTRUMENT ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE

EFFECT OF THIS LEGEND.
This is to certify that the UNITED STATES DEPARTMENT OF THE

TREASURY is the owner of FOUR MILLION (4,000,000) fully paid and non-assessable

shares of Series D Fixed Rate Cumulative Perpetual Preferred Stock, $5.00 par value,

liquidation preference $10,000 per share (the "Stock"), ofthe American International

Group, Inc. (the "Company"), transferable on the books ofthe Company by the holder

hereof in person or by duly authorized attorney upon surrender ofthis certificate properly

endorsed.

This certificate is not valid or obligatory for any purpose unless countersigned and

registered by the Transfer Agent and Registrar.

Witness the facsimile seal ofthe Company and the facsimile signatures ofits duly

authorized officers.

",..,

COUNTERSIGNED AND REGISTERED:

WELLS FARGO BANK, N.A.,

TRANSFER AGENT AND REGISTRAR

AUTHORIZED SIGNATURE

BY: ----:::-===-=~=---:-=:-.."..,..-:=:-::::----
AMERICAN INTERNATIONAL GROUP, INC.

AMERICAN INTERNATIONAL GROUP, INC. (the "Company") will furnish, without charge to

each stockholder who so requests, a copy of the certificatlt of designations establishing the powers,

preferences and relative, participating, optional or other' ights of each class of stock of the

Company or series thereof and the qualifications, Ii trictions of such preferences and/or

rights applicable to each class ofstock ofthe Compa reof. Such information may be obtained

by a request in writing to the Secretary ofthe Com cipal place of business.

This certificate and the share or sha

all of the provisions of the Company's

Certificate of Designations of the Serie

Preference $10,000 per share) (copies·

holder, by acceptance hereof, assents.

d hereby are issued and shall be held subject to

rtificate of Incorporation, as amended, and the

e Cumulative Perpetual Preferred Stock (Liquidation

re on file with the Transfer Agent), to all of which the

The following abbreviations, when used in the inscription on the face of this certificate, shall be

construed as though they were written out in full to applicable laws or regulations:

TEN COM - as tenants in cornmon

TEN ENT - as tenants by the entireties

IT TEN - as joint tenants with right of

survivorship and not as

tenants in common

UNIF GIFT MIN ACT-Custodian

(Minor) (Cust)

under Uniform Gifts to Minors Act

(State)

Additional abbreviations may also be used though not in the above list.

For value received, hereby selI(s), assign(s) and transfer(s) unto

PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE

_ __,__---,-----,-------:-:--_:__-~:__-__:_---__:__,____:__,.___-_:____,__--- shares

of the capital stock represented by the within certificate, and do(es) hereby irrevocably constitute and

appoint , Attorney to transfer the said stock on the books of the within named

Company with full power ofsubstitution in the premises.
Dated. _

Signature

NOTICE: .1;0 this assignment must correspond

.~ written upon the face ofthis

ery particular, without

enlargement or any change whatever.

SIGNATURE GUARANTE

NOTICE: The signature(s) should

guaranteed by an eligible guarantor' .,/

institution (banks, stockbrokers, savings

and loan associations, and credit unions

with membership in an approved signature

guarantee medallion program), pursuant to

Rule 17Ad-15 under the Securities

Exchange Act of 1934.


'lJe{aware

%e ~irst State

PAGE 1

I, HARRIET SMITH WINDSOR, SECRETARY OF STATE OF THE STATE OF

DELAWARE, DO HEREBY CERTIFY THAT "AMERICAN INTERNATIONAL GROUP,

INC." IS DULY INCORPORATED UNDER THE LAWS OF THE STATE OF

DELAWARE AND IS IN GOOD STANDING AND HAS A LEGAL CORPORATE

EXISTENCE NOT HAVING BEEN CANCELLED OR DISSOLVED SO FAR AS THE

RECORDS OF THIS OFFICE SHOW AND IS DULY AUTHORIZED TO TRANSACT

BUSINESS.

THE FOLLOWING DOCUMENTS HAVE BEEN FILED:

CERTIFICATE OF INCORPORATION, FILED THE NINTH DAY OF JUNE,

A.D. 1967, AT 9 O'CLOCK A.M.

CERTIFICATE OF AMENDMENT, FILED THE TWENTIETH DAY OF JULY,

A.D. 1967, AT 9 O'CLOCK A.M.

CERTIFICATE OF AMENDMENT, CHANGING ITS NAME FROM "AMERICAN

INTERNATIONAL ENTERPRISES, INC." TO "AMERICAN INTERNATIONAL

GROUP, INC.", FILED THE FOURTH DAY OF OCTOBER, A. D. 1968, AT 9

O'CLOCK A.M.

CERTIFICATE OF AMENDMENT, FILED THE TWENTY-SEVENTH DAY OF

DECEMBER, A.D. 1968, AT 9 O'CLOCK A.M.

RESTATED CERTIFICATE, FILED THE EIGHTH DAY OF APRIL, A. D.

1969, AT 9 0 'CLOCK A.M.

0658607 8310

081145568

Harriet Smith Windsor, Secretary of State

AUTHENTICATION: 6988235

DATE: 11-25-08
t])e[aware

fJFze :First State

PAGE 2

CERTIFICATE OF DESIGNATION, FILED THE TWENTIETH DAY OF MAY,

A.D. 1969, AT 10 0 'CLOCK A.M.

CERTIFICATE OF AMENDMENT, FILED THE FOURTH DAY OF MAY, A. D.

1972, AT 9 O'CLOCK A.M.

CERTIFICATE OF AMENDMENT, FILED THE TWENTY-THIRD DAY OF

APRIL, A.D. 1976, AT 9 O'CLOCK A.M.

CERTIFICATE OF MERGER, FILED THE TWENTIETH DAY OF SEPTEMBER,

A.D. 1978, AT 9:30 O'CLOCK A.M.

CERTIFICATE OF DESIGNATION, FILED THE THIRTIETH DAY OF

SEPTEMBER, A.D. 1981, AT 12 O'CLOCK P.M.

CERTIFICATE OF CORRECTION, FILED THE THIRD DAY OF DECEMBER,

A.D. 1981, AT 9 O'CLOCK A.M.

CERTIFICATE OF AMENDMENT, FILED THE FIRST DAY OF JUNE, A. D.

1982, AT 9 O'CLOCK A.M.

CERTIFICATE OF DESIGNATION, FILED THE NINETEENTH DAY OF

DECEMBER, A.D. 1985, AT 10 O'CLOCK A.M.

CERTIFICATE OF DESIGNATION, FILED THE NINETEENTH DAY OF

DECEMBER, A. D. 1985, AT 10: 01 0 'CLOCK A.M.

CERTIFICATE OF AMENDMENT, FILED THE NINETEENTH DAY OF MAY,

A.D. 1986, AT 9 O'CLOCK A.M.

0658607 8310

081145568

Harriet Smith Windsor, Secretary of State

AUTHENTICATION: 6988235

DATE: 11-25-08
f})efaware

'!fie !First State

PAGE 3

CERTIFICATE OF DESIGNATION, FILED THE NINETEENTH DAY OF MAY,

A.D. 1986, AT 9:01 O'CLOCK A.M.

CERTIFICATE OF DESIGNATION, FILED THE NINETEENTH DAY OF MAY,

A.D. 1986, AT 9:02 O'CLOCK A.M.

CERTIFICATE OF AMENDMENT, FILED THE FIRST DAY OF JUNE, A. D.

1987, AT 9 O'CLOCK A.M.

CERTIFICATE OF AMENDMENT, FILED THE TWENTY-SECOND DAY OF

MAY, A.D. 1992, AT 9 O'CLOCK A.M.

RESTATED CERTIFICATE, FILED THE THIRTIETH DAY OF NOVEMBER,

A.D. 1994, AT 9 O'CLOCK A.M.

RESTATED CERTIFICATE, FILED THE SECOND DAY OF JUNE, A. D.

1995, AT 9 O'CLOCK A.M.

CERTIFICATE OF AMENDMENT, FILED THE THIRD DAY OF JUNE, A. D.

1998, AT 9 O'CLOCK A.M.

CERTIFICATE OF MERGER, FILED THE THIRTIETH DAY OF DECEMBER,

A.D. 1998, AT 12 O'CLOCK P.M.

AND I DO HEREBY FURTHER CERTIFY THAT THE EFFECTIVE DATE OF

THE AFORESAID CERTIFICATE OF MERGER IS THE FIRST DAY OF JANUARY,

A.D. 1999.

CERTIFICATE OF AMENDMENT, FILED THE FIFTH DAY OF JUNE, A.D.

0658607 8310

081145568

You _y verify this certificate online at corp.delllW'llre.gov/authver.shtml

Harriet Smith Windsor, Secretary of State

AUTHENTICATION: 6988235

DATE: 11-25-08
tJJefaware

%e :First State

2000, AT 9 O'CLOCK A.M.

PAGE 4

CERTIFICATE OF DESIGNATION, FILED THE TWENTY-FOURTH DAY OF

NOVEMBER, A.D. 2008, AT 5:39 O'CLOCK P.M.

AND I DO HEREBY FURTHER CERTIFY THAT THE AFORESAID

CERTIFICATES ARE THE ONLY CERTIFICATES ON RECORD OF THE

AFORESAID CORPORATION, "AMERICAN INTERNATIONAL GROUP, INC."_

AND I DO HEREBY FURTHER CERTIFY THAT THE ANNUAL REPORTS HAVE

BEEN FILED TO DATE.

AND I DO HEREBY FURTHER CERTIFY THAT THE FRANCHISE TAXES

HAVE BEEN PAID TO DATE.

0658607 8310

081145568

Harriet Smith Windsor, Secretary of State

AUTHENTICATION: 6988235

DATE: 11-25-08


AMERICAN INTERNATIONAL GROUP, INC.

RESOLUTIONS OF THE BOARD OF DIRECTORS

NOVEMBER 9, 2008

Issuance of Preferred Stock and Warrants

RESOLVED, that this Board of Directors (the "Board") hereby approves the

issuance of, and the Corporation be and hereby-is authorized to issue (i) $40 billion

aggregate liquidation preference ofpreferred stock, par value $5.00 per share, ofthe

Corporation (the "Preferred Stock") and (ii) warrants to purchase a number ofshares of

common stock, par value $2.50 per share (the "Common Stock"), ofthe Corporation equal

to 2 percent ofthe issued and outstanding shares (the "Warrant Shares") ofCommon Stock,

ofthe Corporation on the date ofsuch issuance (the "Warrants"), in each case on

substantially the terms and conditions presented to the Board at this meeting, as set forth on

Annex A hereto with such changes as the Chairman and ChiefExecutive Officer, any Vice

Chairman, any Executive Vice President, the Secretary or the Treasurer (each, an

"Authorized Officer") ofthe Corporation may deem necessary, desirable or appropriate;

RESOLVED, that this Board hereby determines that the consideration for the

Preferred Stock shall be the cash payment of$1 0,000 per share and that such consideration

is adequate consideration for the Preferred Stock. The Board hereby declares that a portion

ofsuch consideration equal to $5.00 per share shall become part of, and shaUbe credited to,

the capital ofthe Corporation upon issuance ofthe Preferred Stock. All shares ofthe

Preferred Stock when issued shall be validly issued, fully paid and nonassessable;

RESOLVED, that the Corporation is authorized to issue up to such number of

shares ofCommon Stock, and/or to transfer such number ofshares ofCommon Stock as

may be held as treasury shares, as are required to be issued or delivered in connection with

the exercise ofthe Warrants; and that the Board hereby instructs the Secretary ofthe

Corporation to initially reserve, or cause to be reserved, the gross number ofshares

issuable upon exercise in full ofthe Warrants, with such number ofshares of Common

Stock being increased or decreased from time to time with no further action ofthis Board

or any committee thereof upon anti-dilution adjustments, if any;

RESOLVED, that this Board hereby determines that the consideration for the

issuance ofthe Warrant Shares shall be the cash payment described in Annex A (subject to

anti-dilution adjustment as provided in the Warrants) or the withholding of a number of

shares ofCommon Stock with a value equal to the exercise price as calculated in

accordance with the terms ofthe Warrants, and that such consideration is adequate

consideration for the Warrant Shares. The Board hereby declares that a portion ofsuch

consideration equal to the then par value ofthe Common Stock per share shall become part
of, and shall be credited to, the capital ofthe Corporation upon issuance of each Warrant

Share upon exercise ofa Warrant. All ofthe Warrant Shares when issued in accordance

with the Warrant shall be validly issued, fully paid and nonassessable;

Amendment to Credit Agreement

FURTHER RESOLVED, that the Corporation be and hereby is authorized to enter

into an amendment to the Credit Agreement, dated as of September 22, 2008, as amended

(the "Credit Agreement"), between the Corporation and the Federal Reserve Bank of New

York on substantially the terms and conditions presented to the Board at this meeting, as

set forth on Annex B hereto (the "Credit Agreement Amendment"), with such amendments

and changes as any Authorized Officer may deem necessary, desirable or appropriate, such

necessity, desirability or appropriateness to be conclusively evidenced by the execution of

the Credit Agreement Amendment;

Securities Lending Program

FURTHER RESOLVED, that this Board hereby approves the formation of a new

entity (the "SLP Entity") in such form and under the laws ofsuch jurisdiction as any

Authorized Officer may determine, such determination to be conclusively evidenced by

the establishment thereof; and that the Corporation be and hereby is authorized to cause

subsidiaries who participate in the Corporation's securities lending program, directly or

though AIG Global Securities Lending Corp., as agent for those participants, to (i) transfer

residential mortgage-backed securities held as collateral for loans in the Corporation's

securities lending program to the SLP Entity, (ii) accept in exchange therefor securities

issued by the SLP Entity, and (iii) sell those securities to the Federal Reserve Bank ofNew

York and the Corporation (or designees thereof), in each case in amounts and on

substantially the terms and conditions presented to the Board at this meeting, as set forth on

Annex C hereto (the "SLP Arrangement"), with such amendments or changes thereto as

any Authorized Officer may deem necessary, desirable or appropriate;

Exposure to Multi-Sector Credit Default Swaps

FURTHER RESOLVED, that this Board hereby approves the formation of a new

entity (the "CDO Entity" and, together with the SLP Entity, the "Entities"), in such form

and under the laws ofsuch jurisdiction as any Authorized Officer may determine, such

determination to be conclusively evidenced by the establishment thereof; that the

Corporation be and hereby is authorized to (i) provide capital (in the form of equity or

otherwise as any Authorized Officer may determine) to CDO Entity in an amount up to $5

billion, (ii) cause one or more of its subsidiaries to negotiate for the termination of credit

derivative transactions relating to underlying assets being acquired by CDO Entity (the

"CDS Transactions") and (iii) to the extent necessary or required, cause one or more

subsidiaries to contribute to the cost ofterminating the CDS Transactions, in each case on

substantially the terms and conditions presented to the Board at this meeting, as set forth on

2
AnnexO hereto (the "COO Arrangement"), with such'amendments or changes thereto as

any Authorized Officer may deem necessary, desirable or appropriate;

Establishment of Entities

FURTHER RESOLYEO, that each Authorized Officer be, and each ofthem hereby

is, authorized in the name and on behalf ofthe Corporation, and on behalf of either Entity

in the name of the Corporation, as incorporator, sponsor, depositor or originator, to select

one or more employees ofthe Corporation or any subsidiary to act as directors, partners,

members, managers, trustees, trust administrators, or attorneys-in-fact or agents for such

Entity (each, an "Administrative Agent") as any Authorized Officer may determine;

FURTHERRESOLVED, that each Authorized Officer be, and each ofthem hereby

is, authorized in the name and on behalf ofthe Corporation, and on behalfof either Entity

in the name ofthe Corporation, as incorporator, sponsor, depositor, or originator, to execute

or cause to be executed, and to direct any Administrative Agent to execute or cause to be

executed, organizational documents or agreements or instruments in connection with the

establishment ofthe Entity, and to file or cause to be filed with the applicable authority in

the jurisdiction offormation ofthe Entity, any and all documents to create and to give

continuing effect to the Entity, in each case as any Authorized Officer may detennine; and

that each such document, agreement or instrument shall be in such fonn and contain such

terms and provisions as any Authorized Officer shall approve, such approval to be

conclusively evidenced by the execution or filing thereof;

Authorization ofFinance Committee

FURTHER RESOLVED, that this Board hereby delegates to the Finance

Committee ofthis Board all the power and authority ofthis Board with respect to the

Preferred Stock and Warrants, the Credit Agreement Amendment, the SLP Arrangement

and the CDO Arrangement, and the Finance Committee be and hereby is authorized to take

any action that the Board could have taken with respect to these matters;

General

FURTHER RESOLVED, that each Authorized Officer be, and each ofthem hereby

is authorized and empowered, on behalf ofthe Corporation, and in its name and in the

name of each Entity, (i) to execute or cause to be executed any agreement, document,

certificate or instrument (including, without limitation, all notices, certificates, affidavits,

purchase agreements, loan agreements, joint venture agreements, rights agreements and

other agreements, documents, certificates or instruments required or permitted to be given

or made under the terms ofthe Preferred Stock and Warrants, the Credit Agreement

Amendment, the SLP Arrangement or the CDO Arrangement), and to take any and all

actions, which such Authorized Officer may determine to be' necessary, desirable or

appropriate in connection with the Preferred Stock and Warrants, the Credit Agreement

Amendment, the SLP Arrangement or the CDO Arrangement and the transactions and

3
arrangements contemplated thereby, such approval to be conclusively evidenced by the

execution thereof by such Authorized Officer; (ii) to incur and payor cause to be paid all

fees, expenses and taxes, induding without limitation, legal fees and expenses in

connection with the Preferred Stock and Warrants, the Credit Agreement Amendment, the

SLP Arrangement or the CDO Arrangement and the matters contemplated thereby; and (iii)

to file or cause to be filed with the appropriate local, state or federal and foreign

governmental agencies and bodies, if any, all documents, instruments or certificates as any

such Authorized Officer may deem to be necessary, desirable or appropriate, each ofwhich

shall be in such form and contain such terms and provisions as such Authorized Officer, or

any ofthem, shall approve, such approval to be conclusively evidenced by the execution

thereof by such Authorized Officer; and

Ratification of Past Actions

FURTHER RESOLVED, that all actions heretofore taken by any person who is an

officer, director, employee or agent ofthe Corporation, including any notifications to

various governmental and regulatory authorities as well as the execution of all instruments,

certificates, agreements and other documents, the incurring or paying of expenses, fees and

other amounts and any other acts in furtherance of or in connection with any transactions

authorized by the foregoing resolutions, are hereby approved and ratified in all respects.

4
AnnexA
The undersigned hereby confirm that they have reached an agreement in

principle consistent with the annexed term sheet for the purchase and sale ofthe

Senior Preferred Stock and Warrant.

t

UNITED STATES DEPARTMENT OF

THE TREASURY

By: _

Dated: November 9, 2008

(NY) 0186S/OO2lTERlo1SHEETi AIO.Lener.Agreemcnl.doc

AMERICAN INTERNATIONAL

GROUP, INC.

By: _
TARP AIG SSFllnvestment

Senior Preferred Stock and Warrant

Summary of Senior Preferred Terms

Issuer:

Initial Holder:

Size:

Security:

Ranking:

Term:

Dividend:

Redemption:

Restrictions on

Dividends:

American International Group, Inc. ("AIG").

United States Department of the Treasury (the "USr).

$40 Billion aggregate liquidation preference.

Senior Preferred, liquidation preference $10.000 per share;

provided that UST may, upon transfer of the Senior Preferred,

require AIG to appoint a depositary to hold the Senior Preferred

and issue depositary receipts.

Senior to common stock and pari passu with existing preferred

shares other than preferred shares which by their terms rank

junior to the Senior Preferred. At the meeting of stockholders

called to effect the amendments to AIG's Restated Certificate of

Incorporation contemplated by the terms of the convertible

preferred stock. AIG shall propose an amendment to its Restated

Certificate of Incorporation to allow the Senior Preferred to rank

senior to the convertible preferred stock.

Perpetual life.

The Senior Preferred will accrue cumulative dividends at a rate

of 10% per annum. Dividends will be payable quarterly in arrears

on February 1, May 1, August 1 and November 1 of each year.

Dividends will be payable when, as and if declared by the Board

of Directors of AIG. Accrued but unpaid dividends shall

compound quarterly.

At any time that (i) the AIG Credit Facility Trust (or any successor

entity established for the benefit of the United States Treasury)

"beneficially owns" less than 30% of the aggregate voting power

of AIG's voting securities and (ii) no holder of the Senior

Preferred controls AIG. then AIG may redeem the Senior

Preferred in whole or in part at a redemption price equal to 100%

of its liquidation preference. plus an amount equal to accrued

and unpaid dividends (including. if applicable, dividends on such

amount). "Control" for this purpose means the power to direct the

management and policies of AIG, directly or indirectly, whether

through the ownership of voting securities, by contract, by the

power to control AIG's Board of Directors or otherwise.

"Beneficially owns" is as defined in Rule 13d·3 under the

Securities Exchange Act of 1934. For the avoidance of dOUbt,

while there is AIG's Board of Directors control (or the potential to

gain AIG's Board of Directors contrOl) by the holder of the Senior

Preferred, then AIG is not permitted to redeem the Senior

Preferred.

Subject to certain exceptions, for as long as any Senior Preferred

(NY) 07865!002iTERMSHEET!AIG.reron.Sheel.doc
is outstanding, no dividends may be declared or paid on junior

preferred shares, preferred shares ranking pari passu with the

Senior Preferred ("Parity Stock"), or common shares (other than

(i) in the case of pari passu preferred shares, dividends on a pro

rata basis with the Senior Preferred and (ii) in the case of junior

preferred shares, dividends payable solely in common shares),

nor may AIG repurchase or redeem any junior preferred shares,

preferred shares ranking pari passu with the Senior Preferred or

common shares, unless all accrued and unpaid dividends for all

past dividend periods on the Senior Preferred are fully paid or

declared and a sum sufficient for the payment thereof set apart.

Common dividends: The UST's consent shall be required for any increase in common

dividends per share until the fifth anniversary of the date of this

investment unless prior to such fifth anniversary the Senior

Preferred is redeemed in whole or the UST has transferred all of

the Senior Preferred to third parties.

Repurchases:

Voting rights:

The USTs consent shall be required for repurchases of any

common shares, other capital stock, trust preferred securities or

other equity securities (other than (i) repurchases of the Senior

. Preferred, (ii) repurchases of junior preferred shares or common

shares ("Junior Stock") in connection with the administration of

any employee benefit plan in the ordinary course of business and

consistent with past practice (inclUding purchases to offset share

dilution pursuant to a publicly announced repurchase plan), (iii) )

any redemption or repurchase of rights pursuant to any

stockholders' rights plan and (iv) the exchange or conversion of

Junior Stock for or into other Junior Stock or of Parity Stock or

trust preferred securities for or into other Parity Stock (with the

same or lesser aggregate liquidation amount) or Junior Stock, in

each case, solely to the extent required pursuant to binding

contractual agreements entered into prior to the signing date of

UST's agreement to purchase the Senior Preferred or any

SUbsequent agreement for the accelerated exercise, settlement

or exchange thereof for common stOCk), until the fifth anniversary

of the date of this investment unless prior to such fifth

anniversary the Senior Preferred is redeemed in whole or the

UST has transferred all of the Senior Preferred to third parties.

Notwithstanding the foregoing, following the redemption in whole

of the Senior Preferred held by UST or the transfer by UST of all

of the Senior Preferred to one or more third parties not affiliated

with UST, AIG may repurchase, in whole or in part, at any time

the Warrant then held by UST at the fair market value of the

Warrant so long as no holder of the Warrant controls AIG as

prOVided in clause (ii) of "Redemption" above.

The Senior Preferred shall be non-voting, other than class voting

rights on (i) any authorization or issuance of shares other than

the convertible preferred stock ranking senior or pari passu to the

Senior Preferred, (ii) any amendment that adversely affects the

rights of Senior Preferred, or (iii) any merger, exchange or similar

transaction unless the Senior Preferred remains outstanding or is

converted into or exchanged for preference securities of the

surviving or resulting entity or its ultimate parent and the Senior

Preferred or such preference shares have such rights,

preferences, privileges and voting powers, and limitations and

restrictions thereof, taken as a whole, as are not materially less

2

(NY) 07865/002;TERMSHF.ET/AIG.TermShect.doc
Transferability:

Claim in

Bankruptcy:

Acceleration

Rights:

Use of Proceeds:

Tax Tre.atment:

Restrictions on

Expenses:

favorable to the holders thereof than those of the Senior

Preferred immediately prior to such transaction, taken as a

whole.

If dividends on the Senior Preferred are not paid in full for four

dividend periods, whether or not consecutive. the Senior

Preferred will have the right to elect the greater of 2 directors and

a number of directors (rounded upward) equal to 20% of the total

number of directors after giving effect to such election. The right

to elect directors will end when full dividends have been paid for

all past dividend periods.

The Senior Preferred will not be subject to any contractual

restrictions on transfer other than such as are necessary to

insure compliance with U.S. federal and state securities laws.

AIG will file a registration statement (which may be a shelf

registration statement) covering the Senior Preferred as promptly

as practicable, but in any event within 15 days, after notification

by the UST and, if necessary, shall take all action required to

cause such registration statement to be declared effective as

soon as possible. During any period that an effective registration

statement is not available for the resale by the UST of the Senior

Preferred, AIG will also grant to the UST piggyback registration

rights for the Senior Preferred and will tak.e such other steps as

may be reasonably requested to facilitate the transfer of the

Senior Preferred including, if requested by the UST, using

reasonable best efforts to list the Senior Preferred on a national

securities exchange. If requested by the UST, AIG will appoint a

depositary to hold the Senior Preferred and issue depositary

receipts.

Equity claim with liquidation preference to common equity claim.

None

To repay the senior secured revolving credit facility governed by

the Credit Agreement dated as of September 22, 2008 (the

"Credit Agreement") between AIG and the Federal Reserve Bank

of New York ("FRBNY").

Dividends on the Senior Preferred are non tax-deductible to AIG.

AIG shall continue to maintain and implement its comprehensive

written policy on corporate expenses and distribute such policy to

all AIG employees. Such policy, as may be amended from time

to time, shall remain in effect at least until such time as any of

the shares of the Senior Preferred are owned by the UST. Any

material amendments to such policy shall require the prior written

consent of the UST until such time as the UST no longer owns

any shares of Senior Preferred, and any material deviations from

such policy, whether in contravention thereof or pursuant to

waivers provided for thereunder, shall promptly be reported to

the UST. Such policy shall, at a minimum: (i) require

compliance with all applicable law; (ii) apply to AIG and all of its

subsidiaries; (iii) govern (a) the hosting, sponsorship or other

3

(NY) 07S65/11Cl2!TERMSHEETiAIG.Term.Sheet.doc
Restrictions on

Lobbying:

Reporting:

Executive

Compensation:

payment for conferences and events, (b) the use of corporate

aircraft, (c) travel accommodations and expenditures, (d)

consulting arrangements with outside service providers, (e) any

new lease or acquisition of real estate, (f) expenses relating to

office or facility renovations or relocations and (g) expenses

relating to entertainment or holiday parties; and (iv) provide for

(a) internal reporting and oversight and (b) mechanisms for

addressing non-eompliance with the policy.

AIG shall continue to maintain and implement its comprehensive

written policy on lobbying, governmental ethics and political

activity and distribute such policy to all AIG employees and

lobbying firms involved in any such activity. Such policy, as may

be amended from time to time, shall remain in effect at least until

such time as any of the shares of the Senior Preferred are

owned by the UST. Any material amendments to such policy

shall require the prior written consent of the UST until such time

as the UST no longer owns any shares of Senior Preferred, and

any material deviations from such policy, whether in

contravention thereof or pursuant to waivers provided for

thereunder, shall promptly be reported to the UST. Such policy

shall, at a minimum: (i) require compliance with all applicable

law; (ii) apply to AIG and all of its subsidiaries and affiliated

foundations; (iii) govern (a) the provision of items of value to any

government officials, (b) lobbying and (c) political activities and

contributions; and (iv) provide for (a) internal reporting and

oversight and (b) mechanisms for addressing non-eompliance

with the policy.

Except as otherwise agreed, AIG shall provide the UST (i) the

information required to be provided by AIG to the FRBNY

pursuant to Section 5.04 of the Credit Agreement, (ii) the notices

required by Section 5.05 of the Credit Agreement, in each case

within the time periods for delivery thereof specified in the Credit

Agreement and (iii) such executive compensation information as

is required for purposes of the Emergency Economic

Stabilization Act of 2008 ("EESA") and the regUlations and

guidelines thereunder; prOVided that, after the termination of the

Credit Agreement, such informational and notice requirements as

are provided in Section 5.04 and Section 5.05 of the Credit

Agreement shall remain in full force and effect until such time as

the UST no longer owns any shares of Senior Preferred. In

addition, AIG shall promptly provide the UST such other

information and notices as the UST may reasonably request from

time to time.

As a condition to the closing of this investment, AIG shall be

SUbject to the executive compensation and corporate

governance requirements of Section 111(b) of the EESA and the

USTs guidelines that carry out the provisions of such subsection

for systemically significant failing institutions as set forth in Notice

2008-PSSFI. Accordingly, as a condition to the closing of this

investment, AIG and its senior executive officers covered by the

EESA ("SEOs") shall modify or terminate all benefit plans,

arrangements and agreements (including golden parachute

agreements) to the extent necessary to be in compliance with,

4

(NY) OiS6~iOO2ITF.RMSHEETf AIG.Tcnn.Sheel.dot
Risk Management

Committee:

Miscellaneous:

and following the closing and for so long as the UST holds any

equity or debt securities of AIG issued under this agreement (the

"Relevant Period"), AIG shall agree to be bound by the executive

compensation and corporate governance requirements of

Section 111 (b) of the EESA and the guidelines set forth in Notice

2008-PSSFI. As an additional condition to the closing, AIG and

its SEOs shall grant to the UST and the SEOs shall grant to AIG

waivers releasing the UST, and, in the case of the SEOs release,

AlG, from any claims that AIG and such SEOs may otherwise

have as a result of any modification of the terms of any benefit

plans, arrangements and agreements to eliminate any provisions

that would not be in compliance with the executive compensation

and corporate governance requirements of Section 111 of the

EESA.and the gUidelines set forth in Notice 2008-PSSFI.

In addition to Notice 2008-PSSFI, the following will apply:

1. AIG shall undertake during the Relevant Period to

limit any golden parachute payments to its most senior employee

group, who are currently referred to as Senior Partners ("Senior.

Partners"), (other than its SEOs) to the amounts permitted by the

regulations relating to participants in the EESA Capital Purchase

Program and the guidelines and Interim Final Rule (31 CFR Part

30) relating thereto as if they were SEOs (except that equity

denominated awards settled solely in equity shall not be included

in such limit), and AIG shall grant the UST a waiver releasing the

UST, and shall use its best efforts to obtain waivers from the

Senior Partners releasing the UST and AIG, from claims that AIG

may have against the UST and that such Senior Partners may

have against the UST or AIG as a result of such limits, and shall

have obtained such waivers from AIG and its U.S.-based Senior

Partners prior to and as an additional condition to the closing.

2. The annual bonus pools payable to Senior Partners

in respect of each of 2008 and 2009 shall not exceed the

average of the annual bonus pools paid to Senior Partners for

2006 and 2007 (in each case exclusive of AIG's historic quarterly

bonus program, the amount of which will not increase for any

participant, and subject to appropriate adjustment for new hires

and departures).

AIG shall establish, within 30 days of the issuance of the Senior

Preferred, and maintain, at least until the UST ceases to own any

shares of the Senior Preferred, the Warrant or any other equity

or debt securities of AlG, a risk management committee of the

AIG's Board of Directors that will oversee the major risks

involved in AIG's business operations and review AIG's actions

to mitigate and manage those risks.

The dividend rate as prOVided in "Dividend" above is subject to

adjustment in the sole discretion of the Secretary of the Treasury

in light of, inter alia, then-prevailing economic conditions and the

financial condition of AIG, with the objective of protecting the

U.s. taxpayer.

5

(NY) 01S65!OO2!TF.RMSHEET!AIG.Tcnn.Sheel doc
Warrant:

Term:

Exercisability:

Transferability:

Voting:

Substitution:

Summary of Warrant Terms

The UST will receive a warrant ("Warrant") to purchase a number

of shares of common stock of AIG ("Common Stock") equal to

2% of the issued and outstanding shares of Common Stock on

the date of investment. The initial exercise price for the Warrant

shall be $2.50 per share of Common Stock (representing the par

value of the Common Stock on the date of the investment),

subject to customary anti-dilution adjustments; provided that the

initial exercise price per share of Common Stock shall be

adjusted to the par value per share of the Common Stock

following the amendments to AIG's Restated Certificate of

Incorporation contemplated by the terms of the convertible

preferred stock. The Warrant shall be net share settled or, if

consented to by AIG and the UST, on a full physical basis.

10 years

Immediately exercisable, in whole or in part.

The Warrant will not be subject to any contractual restrictions on

transfer other than such as are necessary to ensure compliance

with U.S. federal and state securities laws. AIG will file a

registration statement (which may be a shelf registration

statement} covering the Warrant and the Common Stock

underlying the Warrant as promptly as practicable, but in any

event within 15 days after notification by the UST, and, if

necessary, shall take all action required to cause such

registration statement to be declared effective as soon as

possible. During any period that an effective registration

statement is not available for the resale by the UST of the

Warrant or the Common Stock underlying the Warrant, AIG will

also grant to the UST piggyback registration rights for the

Warrant and the Common Stock underlying the Warrant. AIG will

apply for the listing on the New York Stock Exchange of the

Common Stock underlying the Warrant and will take such other

steps as may be reasonably requested to facilitate the transfer of

the Warrant and the underlying Common Stock.

The UST will agree not to exercise voting power with respect to

any shares of Common Stock issued to it upon exercise of the

Warrant.

In the event AIG is no longer listed or traded on a national

securities exchange the Warrant will be exchangeable (in whole

or in part), at the option of the UST, for an economic interest (to

be determined by the UST after consultation with AIG) of AIG

classified as permanent equity under GAAP having a fair market

value (as determined by the UST) equal to the portion of the

Warrant so exchanged.

6

(NY) 07R65!002!Tf.RMSHEETIAIG.Term.Sheet.doc
Annex B
DPW DRAFT 111612008

AMENDMENT NO.2 TO CREDIT AGREEMENT

AMENDMENT dated as of November U, 2008 to the Credit Agreement

dated as of September 22,2008 (as amended from time to time, the "Credit

Agreement") between AMERICAN INTERNATIONAL GROUP, INC., as

Borrower (the "Borrower") and FEDERAL RESERVE BANK OF NEW YORK,

as Lender (the "Lender").

PRELIMINARY STATEMENTS

(l) WHEREAS, Borrower intends to issue 2008 Preferred Stock (as

defined below) having an aggregate liquidation preference of $40 billion.

(2) WHEREAS, Borrower has requested Lender to amend the Credit

Agreement in connection with such issuance and to make certain other changes as

described herein, and Lender has agreed, subject to the terms and conditions

hereinafter set forth, to amend the Credit Agreement to effect such changes as set

forth below.

NOW, THEREFORE, in consideration ofthe mutual covenants and

agreements set forth herein and for other good and valuable consideration, the

sufficiency and receipt ofwhich is hereby acknowledged, the parties hereto

hereby agree as follows:

SECTION 1. Defined Terms; References. Unless otherwise specifically

defined herein, each term used herein that is defined in the Credit Agreement has

the meaning assigned to such term in the Credit Agreement. Each reference to

"this Agreement", "hereof', "hereunder", "herein" and "hereby" and each other

similar reference in the Credit Agreement, and each reference in any other Loan

Document to "the Credit Agreement", "thereof', "thereunder", "therein" or

"thereby" or other similar reference to the Credit Agreement, shall, after the

Amendment No.2 Effective Date (as defined in Section 9 ofthis Amendment),

refer to the Credit Agreement as amended hereby.

SECTION 2. Amendments to Definitions. Section 1.01 ofthe Credit

Agreement is amended by adding or amending (as applicable) the following

definitions to read in their entirety as follows:

''''2008 Preferred Stock" shall mean the Series 0 Preferred Stock

ofthe Borrower, par value $5.00 per share, issued to the United

States Department ofthe Treasury.

(NY) 21Q6li208lNEW.BRIDGE/CREDIT.AGREEMENT.AMENDMENTS/AMENDMENT.NO.1;Amend.l.doc 11/03108 S:24 I'M
"2008 Warrants" shall mean warrants issued by the Borrower to

the United States Department ofthe Treasury concurrently with the

issuance ofthe 2008 Preferred Stock.

"Applicable Margin" shall mean 3.00% per annum.

"Maturity Date" shall mean September 13,2013.

"Subjed Issuer" shall mean any Person that is a Subject Issuer as

defined in the Guarantee and Pledge Agreement, excluding any

Person whose Equity Interests are not (and are not required to be)

subject to any Lien in favor ofthe Lender pursuant to the

Guarantee and Pledge Agreement."

SECTION 3. Amendment to Available Commitment Fee. Section 2.05(a)

ofthe Credit Agreement is hereby amended by replacing the reference to "8.50%"

therein with "0.75%".

SECTION 4. Commitment Reduction. Section 2.10(h) ofthe Credit

Agreement is hereby amended to read in its entirety as follows:

"(h) Simultaneously with any prepayment required by

paragraph (b), (c) or (d) ofthis Section 2.10, the Commitment shall

be automatically and permanently reduced (i) in the caSe of any

prepayment from the Net Cash Proceeds ofthe issuance of 2008

Preferred Stock and the 2008 Warrants, to $60,000,000,000 and

(ii) otherwise, in an amount equal to that portion ofthe Net Cash

Proceeds required to be applied to prepay the Original Principal

Amount ofthe Loans pursuant to such paragraphs."

SECTION 5. Amendments to Certain Covenants. The proviso to Section

6.06(a) ofthe Credit Agreement is hereby amended by replacing "and" where it

appears at the end of clause (i) thereof with a semicolon and adding the following

new clause (iii) after clause (ii) thereof:

"and (iii) so long as no Default shall have occurred and be

continuing or would result therefrom, the Borrower may make

payments of cumulative compounding dividends on its 2008

Preferred Stock at a rate not to exceed 10% per annum"

SECTION 6. Amendments to Exhibit D. Exhibit D ofthe Credit

Agreement is hereby amended to read in its entirety as set forth on Exhibit A

hereto.

SECTION 7. Certain Technical Amendments. (a) Clause (E) ofthe

proviso to Section 6.06(b) is hereby amended to read in its entirety as follows

2

(NY) 279611208lNEW.BRlOOEiCREDIiAGREEMENT.AMENDMENTS!AMENDMENT.NO.I/Amend.l.doc 11l03i08 5:24 PM
..(E) clause (i) ofthe foregoing shaH not apply to restrictions or

conditions imposed by any agreement relating to secured

Indebtedness or secured Swap Contracts permitted by this

Agreement ifsuch restrictions or conditions apply only to the

property or assets securing such Indebtedness or such Swap

Contracts, as the case may be".

(b) Schedule 8.01 ofthe Credit Agreement is hereby amended by

replacing the entry requiring that notices be copied to Joyce M. Hansen with the

following new entry:

Federal Reserve Bank ofNew York

33 Liberty Street New York, New York 10045

Attention: James R. Hennessy, Counsel and Vice President

Telecopy: (212) 720~7797

Telephone: (212) 720-5024

E-mail: james.hennessy@ny.frb.org

SECTION 8. Representations ofBorrower. The Borrower represents and

warrants on the Amendment No.2 Effective Date that (i) the representations and

wan'anties of Borrower contained in Article 3 of the Credit Agreement and by any

Loan Party in any other Loan Document shall be true and correct on and as ofthe

Amendment No.2 Effective Date, except to the extent that such representations

and warranties specifically refer to an earlier date, in which case they shall be true

and correct as ofsuch earlier date; and (ii) no Default or Event ofDefault shall

exist on the Amendment No.2 Effective Date after giving effect to this

Amendment

SECTION 9. Conditions to Effectiveness. This Amendment shall

become effective on the date (the "Amendment No.2 Effective Date") when,

and only when, each ofthe following conditions shall have been satisfied to the

satisfaction of Lender:

(a) Execution ofCounterparts. Lender shall have received from

Borrower a counterpart hereofsigned by Borrower.

(b) Execution ofConsent. Lender shall have received counterparts of a

consent substantially in the form ofExhibit B to this Amendment, duly executed

by each Guarantor.

(c) Expenses. Lender shan have received reimbursement for all costs

and expenses (including fees, charges and disbursements of counsel to Lender) to

the extent required by Section 8.05(a) ofthe Credit Agreement, including in

connection with the preparation, negotiation and execution ofthis Amendment.

(d) Consummation 0[2008 Preferred Stock Issuance. Borrower shall

have consummated the issuance of2008 Preferred Stock having a liquidation

3

(NY) 2796Ii208/NEW.BRIDGflCREDlT,AOPJ;:EMENT.AMENDMENTSIAMENDMENT.NO.IIAlllend.l.cio<; 111031085:24 PM
preference of not less than $40,000,000,000 on or prior to the Amendment No.2

Effective Date.

SECTION 10. Certain Consequences qrEffectiveness. On and after the

Amendment No.2 Effective Date, the rights and obligations ofthe parties hereto

shall be governed by the Credit Agreement as amended by this Amendment;

provided that the rights and obligations ofthe parties to the Credit Agreement

with respect to the period prior to the Amendment No.2 Effective Date shall

continue to be governed by the provisions ofthe Credit Agreement prior to giving

effect to this Amendment. Each Loan Document, as specifically amended hereby,

is, and shall continue to be, in full force and effect and is hereby ratified and

confirmed in all respects. Without limiting the foregoing, the Security

Documents and all ofthe Collateral do and shall continue to secure the payment

of all obligations under the Loan Documents as amended hereby.

SECTION 11. Governing Law. This Amendment shall be governed by,

and construed in accordance with, the laws ofthe State of New York.

SECTION 12. Counterparts. This Amendment may be signed in any

number of counterparts, each of which shall be an original, with the same effect as

ifthe signatures thereto and hereto were upon the same instrument. Delivery by

telecopier of an executed counterpart of a signature page to this Amendment shall

be effective as delivery of an original executed counterpart of this Amendment.

4

(NY) 27961120S/NEW.BRIDGEiCRED1T.AGREEMENT.AMENDMENTSIAMENDMENT.NO.1IAmend.l.doc: 11I03/0S 5:24 PM
IN WI1NESS WHEREOF, the parties hereto have caused this

Amendment to be duly executed as ofthe date first above written.

AMERICAN INTERNATlONAL

GROUP, INC., as Borrower

By:

Name:

Title:

(NY) 2796112081NEW.8RlOGElCREDlT.AGREEMF.NT.AMENDMENTS/AMENDMENT.NO.l/Amcnd.l.doc 11/03108 5:24 PM
FEDERAL RESERVE BANK OF NEW

YORK, as Lender

By:

Name:

Title:

(NY) 2796 1!208/NEW.BRIDGEiCREDlT.AGREEMh"NT.AMENDMENTS/AMENDMENT.NO.IIAmend.l.doc 11/03/08 5:24 PM
EXHIBIT A

(NY) 279611208/NEW.BRIOGEfCRF.DIT.AGREEMENT.AMENDMENTS/AMENDMENT.NO.11Amend.l.doc 11103.108 5:24 PM
EXHIBITD

Summary of Terms of Preferred Stock and Related Issues

Issuer

Purchaser

Securities

Consideration

Voting rights

Dividends

CoO\'ersion

Anti-Dilution

Provisions

Term

Liquidation

preference

American International Group, Inc. ("AIG").

AIG Credit Facility Trust, a new trust established for the benefit ofthe United States

Treasury ("Trust"),

100,000 shares of Series C Perpetual, Convertible, Participating Preferred Stock, par

value $5.00 per share ("Preferred Stock"),

$500,000 plus the lending commitment ofthe Federal Reserve Bank ofNew York

C"NY Fed"); AIG's board will acknowledge the receipt of value at least equal to the

aggregate par value ofthe shares of Preferred Stock in connection with their issuance.

Except where a class vote is required by law, the Preferred Stock will vote with the

common stock on all matters submitted to AIG's stockholders, and will be entitled to

an aggregate number of votes equal to (i) the Initial Number of Shares (as defined

below), as adjusted pursuant to the anti-dilution provisions, minus (ii) the votes, if

any. attributable to shares of common stock previously issued on any partial

conversion of the Preferred Stock; provided that the number of votes attributable to the

Preferred Stock shall not exceed 77.9% ofthe aggregate number of votes ofthe

Preferred Stock and the shares of common stock then outstanding.

The Preferred Stock will be entitled to participate in any dividends paid on the

common stock, and shall receive (i) the dividends attributable to the Initial Number of

Shares, as adjusted pursuant to the anti-dilution provisions, minus (ii) the dividends, if

any, paid with respect to shares of common stock previously issued on any partial

conversion ofthe Preferred Stock; provided that the dividends attributable to the

Preferred Stock shall not exceed 77.9% ofthe aggregate amount of dividends paid on

the Preferred Stock and the shares of common stock then outstanding.

Upon the effectiveness ofthe amendment to AIG's restated certificate ofincorporation

described in clause (i) under "Stockholder vote," the Preferred Stock will be

convertible into a number of shares of common stock (the "Initial Number of Shares")

equal to the excess of(a) the product of 3.9751244 times the Number of Outstanding

Shares over (b) 53,798,766 (the number ofshares of common stock underlying the

2008 Warrants). The "Number ofOutstanding Shares" means, as ofany date, the

number ofshares of common stock outstanding as of the date of issuance ofthe

Preferred Stock plus the number ofshares of common stock, ifany, issued on or prior

to such date in sealement of AIG's Equity Units.

The Preferred Stock will have customary anti-dilution provisions.

Perpetual.

$500,000 in aggregate.

(NY) 07865!002/TARP/EKhibil.D.Tms\.cquity.Interesl.doc
Stockholder vote

Equity issues

Governance

Registration rights

Regulation

AIG's board will call a meeting ofstockholders as soon as practicable after the

issuance ofthe Preferred Stock. At that meeting, the stockholders, with the common

stockholders voting as a separate class in the case ofthe matters in clause (i), will vote

on, among other things, (i) amendments to AIG's certificate of incorporation to (a)

reduce the par value of AIG's common stock to $0.00000 I per share and (b) increase

the number of authorized shares of common stock to 19 billion and (ii) any other

measures deemed by the NY Fed to be necessary for the conversion ofthe Preferred

Stock or the operation of the Facility, including the pledging of collateral thereunder.

So long as the Trust's equity ownership, determined as the sum of its ownership of

common stock and the number ofshares of common stock underlying the Preferred

Stock (whether or not the Preferred Stock is then convertible), shall equal or exceed

50% ofthe Initial Number of Shares (as adjusted pursuant to the anti-dilution

provisions), AIG shall not issue any capital stock, or any or securities or instruments

convertible or exchangeable into, or exercisable for, capital stock, without the written

consent ofthe Trust other than (i)(x) issues of capital stock to satisfy any security or

instrument existing on September 16, 2008 that is exercisable for, convertible into or

exchangeable for common stock, (y) in respect of equity compensation awards issued

in the ordinary course of business under AIG's Amended and Restated 2007 Stock

Incentive Plan or AIG's Amended and Restated 2002 Stock Incentive Plan or (z) in

respect of any tax-qualified plan approved in the ordinary course of business by the

Board of Directors ofAIG that meets the requirements of Section 423 ofthe Internal

Revenue Code and (ii) subsequent to written notice from the Trust that AIG's

corporate governance arrangements are satisfactory to the trustees (x) in respect of

equity compensation awards issued under any equity compensation plan (including

any material amendments thereto) approved by shareholders after September 16,2008

in accordance with the shareholder approval requirements of the NYSE Listed

Company Manual or (y) in anyone year, up to 0.5% of the outstanding shares of

common stock pursuant to any other employee benefit plan, employment contract or

similar arrangement that is approved by the Compensation and Management

Resources Committee ofthe Board of Directors of AIG.

AIG and its board will work in good faith with the trustees ofthe Trust to ensure

corporate governance arrangements satisfactory to the trustees.

AIG will enter into a customary agreement providing for demand registration rights for

the Preferred Stock and the underlying common stock, will apply for the listing on the

NYSE ofthe common stock underlying the Preferred Stock, and will take such other

steps as the NY Fed may reasonably request to facilitate the transfer ofthe Preferred

Stock or common stock received on conversion ofthe Preferred Stock.

AIG will take all actions necessary or expedient for obtaining any regulatory

approvals, notices, waivers or consents related to the issuance and acquisition ofthe

Preferred Stock and will assist the NY Fed in such matters.

2

(NY) 0786~/OO2'TARP!bhibi\.n Tnos\.Equily.llltere.. doc
NYSE

Takeover laws

AIG will take all actions necessary or expedient for obtaining NYSE approval for the

issuance and voting ofthe Preferred Stock, including actions required ofthe audit

committee ofthe board of AIG to take advantage ofthe exemption from the NYSE's

stockholder approval requirements set forth in Section 312.05 of the NYSE Listed

Company Manual.

AIG will take all actions necessary or expedient in order to exempt the acquisition and

ownership ofthe Preferred Stock and any common stock issued upon conversion of the

Preferred Stock from (i) the requirements of any applicable "moratorium", "control

share", "fair price" or other anti-takeover laws and regulations of any jurisdiction,

including Section 203 ofthe Delaware General Corporation Law, and (ii) any other

applicable provision ofthe organizational documents of AlG or the comparable

organizational documents of any subsidiary of AIG.

3

(NY) 0786SI002ITARP/Exhibit.D.TmSI.Equity.lnlerest.doc
EXHIBITB

Reference is made to Amendment No.2 dated November U, 2008

between American International Group, Inc., as Borrower (the "Borrower") and

Federal Reserve Bank ofNew York, as Lender (the "Lender") (the

"Amendment"). Unless otherwise specifically defined herein, each term used

herein that is defined in the Amendment shall have the meaning assigned to such

tenn in the Amendment.

Each ofthe undersigned hereby consents to the Amendment and hereby

confirms and agrees that (a) notwithstanding the effectiveness ofthe Amendment,

each Loan Document to which it is party is, and shall continue to be, in full force

and effect and is hereby ratified and confinned in all respects, except that, on and

after the effectiveness ofthe Amendment, each reference in the Loan Documents

to the "Credit Agreement", "thereof', "thereunder", "therein" or "thereby" or

similar references to the Credit Agreement shall mean and be a reference to the

Credit Agreement as amended by the Amendment and (b) the Loan Documents to

which each ofthe undersigned is a party and all ofthe Collateral described therein

do, and shall continue to, secure the payment of all obligations under the Loan

Documents, as amended hereby.

[GUARANTORS]

By:

Name:

Title:

(NY) 279611208iNEW.BRIDGFJCREDlT.AGREEMENT.AMENDM£NTS!AM£NDMl::NT.NO.J/Amend.l.doc 11103/085:24 PM
Annex C
MAlDEN LANE II

Term Sheet

November ( ], 2008

Set forth below is a summary ofproposed terms relating to the Maiden

Lane II structure, under which (i) Maiden Lane II LLC ("ML II"), a Delaware

limited liability company, will purchase a certain pool ofRMBS (the "RMBS

Assets") from each ofseveral AIG subsidiaries currently holding such RMBS

Assets (each a "Seller") in exchange for an interest in the Senior Loan and the

Subordinated Loan pro rata to such Seller's share ofthe aggregate RMBS Assets,

(ii) Federal Reserve Bank ofNew York ("FRBNY") will purchase all ofthe

Sellers' interests in the Senior Loan from the Sellers and (iii) American

International Group, Inc. ("AIG") will purchase all ofthe Sellers' interests in the

Subordinated Loan from the Sellers.

I. PARTIES

Sellers:

Borrower and Purchaser:

Senior Lender and

Controlling Party:

Subordinated Lender:

Portfolio Manager:

Collateral Agent:

LLC Administrator:

II. ASSET PURCHASE

AGREEMENT

AIG Subsidiaries listed in Schedule A hereto

MLII

Federal Reserve Bank ofNew York ("FRBNY7')

American International Group, Inc. ("AIG")

[to be determined]

[to be determined]

[to be determined]

Asset Purchase Agreement: ML II shall, subject to satisfaction ofthe conditions

precedent, purchase on the Closing Date the RMBS

Pool from each Seller without recourse (other than for

breach ofrepresentations and warranties) in exchange

for a pro rata interest in the Senior Loan and the

Subordinated Loan.

(NY) 07865iOO21ML, II/lormshccl.mJ.1I,doc 11/05108 8:33 PM
RMBS Assets:

Purchase Price:

Certain documentary

matters:

III. LOAN FACILITY

Senior Loan:

Senior Interest Rate:

Subordinated Loan:

Subordinated Interest Rate:

Senior and Subordinated

Loan Borrowings:

Subordination:

(NY) 0786SIOO2IMLllltermsbeel.mI.11.doc

Collectively, the RMBS issues listed in Schedule A

hereto for each Seller and rights to the outstanding

principal thereof and accrued interest thereon as of

October 31,2008 (for each Seller, an "Indicative

RMBS Pool") less the dispositions thereof and the

collections of principal and interest thereon plus

accrued interest thereon between October 31 and the

Closing Date.

Determined for each Indicative RMBS Pool as of

October 31,2008 (the "Determination Date") and

adjusted on the Closing Date by subtracting the

estimated amount of dispositions and collections since

the Determination Date, and subject to further

adjustment when final information thereon is

available.

Representations, warranties, affirmative and negative

covenants to be determined.

New York governing law.

Term loan equal to the Purchase Price ofRMBS less

$1 billion.

[LIBOR+lOO]

Term loan equal to $1 billion.

[LIBOR+300]

A borrowing in the amount equal to the Purchase Price

will be made on the Closing Date.

Borrowings will be made from time to time soon after·

the Closing Date to fund increases in the Purchase

Price resulting from adjustments to the Purchase Price

made in accordance with the Asset Purchase

Agreement.

Obligations to pay principal and interest under the

Subordinated Loan shall be contractually subordinated

to the obligations to pay principal and interest under

the Senior Loan in accordance with the priority set

2

11105108 8:33 PM
Repayment:

Contingent Interest on

Loans:

Maturity:

Waterfall:

(NY) 078651002iML.IUlcrmsheel.ml.lI.doc

forth in the waterfall provisions.

Principal of Senior Loan is repaid in accordance with

the waterfall provisions and daily sweep mechanics for

the Collateral Account (as defined below). Interest on

the Senior Loan is capitalized [each quarter] until the

principal ofthe Senior Loan is repaid in full.

Principal of Subordinated Loan is repaid in accordance

with the waterfall provisions and daily sweep

mechanics for the Collateral Account, commencing

after all principal of, and interest on, the Senior Loan

has been repaid in full. Interest on the Subordinated

Loan is capitalized [each quarter] until the principal of,

and interest on, the Senior Loan [and the principal of

the Subordinated Loan] is repaid in full.

After all principal of, and interest on, both the Senior

Loan and Subordinated Loan are repaid in full,

remaining cash receipts of ML II are paid 5/6 to the

Senior Lender and 1/6 to the Subordinated Lender, in

each case as contingent interest on the Loans

("Contingent Interest"). Right to Contingent Interest

cannot be transferred except together with related

Loan to same transferee.

The Senior Loan and Subordinated Loan shall mature

on the fifth anniversary ofthe Closing Date, subject to

extension at any time and from time to time by the

FRBNY in its sole discretion: provided that the

maturity ofthe Subordinated Loan may not be

extended beyond the maturity ofthe Senior Loan and

neither can be extended beyond the month

following the stated maturity of the related loan.

First, costs and expenses (including fees and

indemnities) ofthe Senior Lender, the Controlling

Party, the Collateral Agent, the LLC Administrator,

the Portfolio Manager, their advisors (including Ernst

& Young, Blackrock and Morgan Stanley) and their

counsel (including Davis Polk and local counsel) then

due;

Second, cash reserve until the balance thereof is

$L-J(for payment of any expenses that become due

3

It /OS108 8: 3J PM
Collateral:

(NY) 07865/002/ML./Jltcnnsheel.mLlI.doc

on a day when there are insufficient collections to pay

them in full);

Third, principal ofthe Senior Loan;

Fourth, accrued and unpaid interest on the Senior

Loan (other than Contingent Interest);

Fifth, principal ofthe Subordinated Loan;

Sixth, accrued and unpaid interest on the Subordinated

Loan (other than Contingent Interest);

Seventh, 5/6 ofthe remaining amount to Contingent

Interest on the Senior Loan and 1/6 ofthe remaining

amount to Contingent Interest on the Subordinated

Loan

The obligations ofthe Borrower in respect ofthe

Senior Loan and Subordinated Loan shall be secured

by a first priority perfected security interest in all the

RMBS Assets, the securities account ofthe Borrower

and all sub-accounts established thereunder (the

"Collateral Account") where all the RMBS Assets

shall be held, all other financial assets held therein

(including cash), all securities entitlements in respect

ofthe Collateral Account, and all the rights ofML II

under the Asset Purchase Agreement (collectively, the

"Collateral"). All RMBS Assets and all collections

on the RMBS Assets shall be held in the Collateral

Account. The Collateral Agent shall have full control

over the Collateral Account.

Any amounts of cash in excess of $[500,000] cash

reserve to be held in the Collateral Account shall be

swept on a daily basis and applied to repay the Senior

Loan and Subordinated Loan in accordance with the

waterfall. Under the waterfall provision, any proceeds

from the Collateral shall be applied to principal of, and

interest on, the Senior Loan before they are applied to

principal of, or interest on, the Subordinated Loan.

The Collateral will be managed pursuant to the

Collateral Management Agreement.

4 11/05/088:33 PM
IV.

Use ofProceeds:

CERTAIN

DOCUMENTARY

MATTERS

Representations and

Warranties:

Affirmative Covenants:

Negative Covenants:

Liquidation Events

(NY) 0786Sf002.1ML.llJlermshe.l.mI.1I.doc

To pay the Purchase Price ofthe RMBS Assets.

The Loan Documents shall contain representations,

warranties, covenants and liquidation events deemed

appropriate by the Controlling Party, including,

without limitation:

Corporate existence; compliance with law; corporate

power and authority; enforceability of Loan

Documents; no conflict with law or contractual

obligations; no litigation; no default; no liquidation

event; Borrower's activities; taxes; Federal Reserve

regulations; ERISA; Investment Company Act;

subsidiaries; use of proceeds; accuracy of disclosure.

Delivery offinancial statements, reports, accountants'

letters, officers' certificates and other information

requested by the Controlling Party; payment of other

obligations; maintenance of existence and material

rights and privileges; compliance with laws and

material contractual obligations; maintenance of books

and records; right ofthe [Portfolio Manager] to inspect

property and books and records; notices of defaults,

liquidation events, litigation and other material events;

collections on RMBS Assets; third party contracts.

Limitations on: indebtedness; liens; guarantee

obligations; mergers, consolidations, liquidations and

dissolutions; sales of assets; leases; dividends and

other payments in respect of capital stock;

expenditures; investments, loans and advances;

amendments to agreements; formation ofsubsidiaries;

limitation on activities; ERISA; limitation on accounts.

Material inaccuracy ofrepresentations and warranties;

violation of covenants [(subject to a grace period to be

agreed upon)]; loss oflien perfection or priority or

unenforceability ofthe security interest; bankruptcy

events; certain ERISA events.

Upon the occurrence of a Liquidation Event, the

Controlling Party may, in its sole discretion, liquidate

ML II and distribute its assets.

5

11/05/088:33 PM
Voting and Control:

Amendments:

Assignments

Expenses and

Indemnification:

(NY) 0786Si002JML.IJltcrmshccl.mlIldoc

FRBNY shall at all times for so long as the Senior

Loan is outstanding be the Controlling Party that is

pennitted to make all decisions regarding the

Collateral (including the ability to instruct Collateral

Agent), any payments on any subordinated debt and

the timing and amount of any distributions.

The terms and conditions ofthe Senior Loan and the

Subordinated Loan may not be amended, varied or

waived absent the express written consent of a

majority ofthe Senior Lenders; provided that any

amendments to the Subordinated Loan also require the

express written consent of a majority ofthe

Subordinated Lenders; and provided, further, that the

consent ofthe Controlling Party will be required for

certain fundamental amendments.

No Lender may assign or otherwise transfer (including

through participations) its rights or obligations under

the Credit Agreement, except that (i) the Sellers will

transfer their interests in the Senior Loan and

Subordinated Loan to FRBNY and AIG, respectively,

on the Closing Date and (ii) the Senior Lender may

make transfers with the consent of the Controlling

Party.

The Borrower shall pay in accordance with the

waterfall all fees and expenses ofthe Senior Lender,

the Controlling Party, the Collateral Agent, the LLC

Administrator, the Portfolio Manager, their advisors

and accountants (including Ernst & Young, BlackRock

and Morgan Stanley) and counsel (including Davis

Polk and any local counsel) in connection with the

transaction contemplated hereby.

The Controlling Party, the Lenders, the Collateral

Agent, the LLC Administrator and the Portfolio

Manager (and their affiliates and their respective

officers, directors, employees, advisors and agents)

will have no liability for, and will be indemnified and

held hannless against, any loss, liability, cost or

expense incurred in respect ofthe transactions

contemplated hereby (except to the extent resulting

from the gross negligence or willful misconduct ofthe

6 11105108 8:33 PM
indemnified party).

Governing Law and State ofNew York

Forum:

Counsel to Senior Lender Davis Polk & Wardwell

and the Controlling Party:

Counsel to Subordinated Sullivan & Cromwell LLP

Lender:

V. PROPOSED

COLLATERAL

ADMINISTRATION

PROVISIONS

Collateral Management:

Disposal Criteria:

[Collateral Valuation

VI. ML II

LLC Agreement

Management:

Capital Contributions:

(NY) 07865!OO2JML.IIltermsheet.ml.n.doc

On any Business Day, the Portfolio Manager may

dispose of any issue of RMBS ifthe disposal criteria

set forth in the Portfolio Management Agreement have

been met. Any proceeds from such disposal will be

applied in accordance with the waterfall provisions.

[Maximizing the repayment ofthe principal and

interest on the Senior Loan.]

The Portfolio Manager shall calculate and notify the

Lenders ofthe value ofthe Collateral on a monthly

basis.]

FRBNY and AIG as members with FRBNY having

the sole and exclusive control and management rights.

Delaware LLC Agreement.

Day to day management of RMBS Assets to be

handled by Collateral Agent. Normal Delaware LLC

services to be provided by LLC Administrator.

The loans constitute LLC interests for tax and

accounting purposes.

7

11/05108 8:33 PM
SCHEDULEA'

to

ML II Termsheet

[American General Life Insurance Company]

[list ofRMBS Issues in RMBS Pool to come]

[~merican General Life and Accident Insurance Company]

[list ofRMBS Issues in RMBS Pool to come]

[The United States Life Insurance Company in the City of New York]

[list ofRMBS Issues in RMBS Pool to come]

[American General Assurance Company]

[list ofRMBS Issues in RMBS Pool to come]

[AIG Life Insurance Company]

[list ofRMBS Issues in RMBS Pool to come]

[American International Life Assurance Company of New York]

[list ofRMBS Issues in RMBS Pool to come]

[Delaware American Life Insurance Company]

[list ofRMBS Issues in RMBS Pool to come]

[AIG Annuity Insurance Company]

[list ofRMBS Issues in RMBS Pool to come]

[VALIC]

[list ofRMBS Issues in RMBS Pool to come]

[SunAmerica Consolidated]

[list of RMBS Issues in RMBS Pool to come]

8

(NY) 07865iOO2/ML.I1/tennsbeel.mI.1I.doc: IJIOS/08 8:33 PM
Annex D

•
MAIDEN LANE m

Term Sheet

November [~, 2008

Set forth below is a summary of proposed terms relating to the transaction under which a newlycreated special purpose vehicle ("ML III") will purchase a certain pool of assets ("Assets") from

[counterparty] ("Counterparty"), who will concurrently unwind related derivative transactions

("CDS Transactions") that it has entered into with AIG Financial Products Corp. ("AIG-FP")

and for which American International Group, Inc. ("AIG") has provided certain credit support

obligations. The Assets are the reference obligations underlying the CDS Transactions, each as set

forth in Schedule A hereto (subject to verification by the parties hereto).

TOTAL PAYMENT TO

COUNTERPARTY

2 TERMINATION

AGREEMENT

.3 FORWARD PURCHASE

AGREEMENT

(NY) 0786SI002IMUIUCP.Tennshcel.doc

Under the Forward Purchase Agreement and the

Termination Agreement described below, for the

termination ofthe CDS transactions and the purchase

ofthe Assets, Counterparty will be paid the notional

amount for the CDS Transactions, subject to certain

adjustments described in the Forward Purchase

Agreement.

ML III and AIG-FP will enter into a Termination

Agreement with Counterparty substantially in the form

of Exhibit A hereto to terminate the CDS Transactions

and release and discharge AIG-FP's and AlG's

obligations under and in respect ofthe CDS

Transactions and the Counterparty may set off against

collateral posted under the CDS Transactions as

described in the Termination Agreement.

ML III will simultaneously with the Termination

Agreement enter into a Forward Purchase Agreement

with Counterparty substantially in the form of Exhibit

B hereto pursuant to which Counterparty will deliver,

or use best efforts to deliver, the Assets to an escrow

agent in preparation for their sale to ML III under the

Forward Purchase Agreement against payment ofthe

notional amount to Counterparty, taking into account

any collateral posted by AIG-FP in relation to the CDS

Transactions and certain adjustments set forth in the

forward Purchase Agreement.
Subject to the fonnation of ML Ill, and the public announcement ofthe funding of ML 1Jl by the

Federal Reserve Bank of New York and American International Group, Inc. in an amount

sufficient for ML III to perform under the transactions summarized above, [Counterparty] hereby

commits, as of the date hereof, to enter into the transactions summarized in the above Tenn Sheet

and to execute the Forward Purchase Agreement and Tennination Agreement in substantially the

same fonn as the versions annexed hereto.

For and on behalf of

[COUNTERPARTY]

Name:

Title:

Agreed to and accepted by:

AIG FINANCIAL PRODUCTS CORP.

Name:

Title:

Acknowledged by:

FEDERAL RESERVE BANK OF NEW YORK

Name:

Title:

2

(NY) 07865;OO2iML.lIl1el'.Tennsheel.doc

•
(NY) 07865/002!ML.1IIJCP.Termsheel.doc

List of Assets

Schedule A
Form of Termination Agreement

INY) 0 7~(' 5iOOI;ML,IlL'CP Teon<heel.OOt

Exhibit A
Form of Forward Purchase Agreement

(r-;y) 07865iOQ2/ML.llliCP.Tcnnshccr.doc

Exhibit B


• I
AMERICAN INTERNATIONAL GROUP, INC.

RESOLUTIONS OF THE

OF THE BOARD OF DIRECTORS

NOVEMBER 19,2008

Series D Preferred

RESOLVED, that this Board ofDirectors (the "Board") hereby (i)

detennines that the Series D Fixed Rate Cumulative Perpetual Preferred Stock, par value

$5.00 (the "Series D Preferred Stock"), ofthe Corporation shall have the powers,

designations, preferences, rights, qualifications, limitations and restrictions specified in

the Certificate of Designations (the "Series D Preferred Certificate of Designations")

attached hereto as Annex A, and (ii) such Series D Preferred Certificate of Designations

is hereby approved with such changes as the Chainnan and ChiefExecutive Officer, any

Vice Chainnan, any Executive Vice President, the Secretary or the Treasurer (each, an

"Authorized Officer") of the Corporation may deem necessary, desirable or appropriate,

such necessity, desirability or appropriateness to be conclusively evidenced by the

execution thereof;

FURTHER RESOLVED, that any Authorized Officer ofthe Corporation

is hereby instructed to file such Series D Preferred Certificate of Designations with the

office ofthe Secretary of State ofthe State of Delaware, and (ii) to restate the Restated

Certificate ofIncorporation ofthe Corporation to integrate (and not further amend) the

Restated Certificate ofIncorporation in connection with the Series D Preferred Certificate

of Designations;

Warrant

FURTHER RESOLVED, that this Board hereby (i) approves the warrant

(the "Warrant") attached hereto as Annex B for the purchase by the United States

Department ofthe Treasury of 53,798,766 shares of common stock, par value $2.50 per

share (the "Common Stock"), ofthe Corporation in accordance with the terms thereof,

with such changes as any Authorized Officer may deem necessary, desirable or

appropriate, such necessity, desirability or appropriateness to be conclusively evidenced

by the execution thereof, and (ii) reserves up to 53,798,766 shares of Common Stock

from the authorized shares ofCommon Stock ofthe Corporation for issuance and

delivery in connection with the exercise ofthe Warrant.

Transfer Agent and Registrar

RESOLVED, that Wells Fargo Bank, National Association, its successors

and assigns, be and hereby is appointed Transfer Agent, Registrar and Divideng

Disbursing Agent, effective for all shares of the Series D Preferred Stock, to act in

accordance with its general practices and the Transfer Agent Services Agreement dated

as of September 28, 2007.

AnnexA

CERTIFICATE OF DESIGNATIONS

OF

SERIES D FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK

OF

AMERICAN INTERNATIONAL GROUP, INC.

American International Group, Inc., a corporation organized and existing under the

General Corporation Law of the State of Delaware (the "Company"), hereby certifies that the

following resolution was adopted by the Board of Directors of the Company (the "Board of

Directors") as required by Section 151 of the General Corporation Law of the State of Delaware

at a meeting duly held on November 19,2008.

RESOLVED, that pursuant to the authority granted to and vested in the Board of

Directors in accordance with the provisions of the Restated Certificate of Incorporation, as

amended, the Board of Directors hereby creates a series of Serial Preferred Stock, par value

$5.00 per share, of the Company, and hereby states the designation and number of shares, and

fixes the voting and other powers, and the relative rights and preferences, and the qualifications,

limitations and restrictions thereof, as follows:

Series D Fixed Rate Cumulative Perpetual Preferred Stock:

Part 1. Designation and Number of Shares. There is hereby created out of the authorized

and unissued shares ofserial preferred stock of the Company a series of preferred stock

designated as the "Series D Fixed Rate Cumulative Perpetual Preferred Stock" (the "Series D

Preferred Stock"). The authorized number of shares of the Series D Preferred Stock shall be

4,000,000. Such number ofshares may be decreased by resolution of the Board of Directors,

subject to the terms and conditions hereof; provided that no decrease shall reduce the number of

shares of the Series D Preferred Stock to a number less than the number of shares then

outstanding.

Part 2. Standard Provisions. The Standard Provisions contained in Annex A attached

hereto are incorporated herein by reference in their entirety and shall be deemed to be a part of

this Certificate of Designations to the same extent as if such provisions had been set forth in full

herein.

Part. 3. Definitions. The following terms are used in this Certificate of Designations

(including the Standard Provisions in Annex A hereto) as defined below:

(a)

Company.

"Common Stock" means the common stock, par value $2.50 per share, of the

(b) "Convertible Preferred Stock" means the Series C Perpetual, Convertible,

Participating Preferred Stock of the Company. The Convertible Preferred Stock shall be Parity
Stock; provided that the Convertible Preferred Stock shall be Junior Stock following the

effectiveness of an amendment to the Charter to allow the Series D Preferred Stock to rank

senior to the Convertible Preferred Stock as to dividends rights and/or rights upon the

liquidation, dissolution and winding up (the "Amendment").

(c) "Dividend Payment Date" means February 1, May 1, August 1 and November 1

of each year.

(d) "Junior Stock" means the Common Stock, the Convertible Preferred Stock

(following the Amendment) and any other class or series of stock of the Company the terms of

which expressly provide that it ranks junior to the Series D Preferred Stock as to dividend rights

and/or as to rights on liquidation, dissolution or winding up of the Company.

(e) "Liquidation Amount" means $10,000 per share of the Series D Preferred Stock.

(f) "Parity Stock" means the Convertible Preferred Stock (before the Amendment)

and any class or series of stock of the Company (other than the Series D Preferred Stock) the

terms of which do not expressly provide that such class or series will rank senior or junior to the

Series D Preferred Stock as to dividend rights and/or as to rights on liquidation, dissolution or

winding up of the Company (in each case without regard to whether dividends accrue

cumulatively or non-cumulatively).

(h) "Signing Date" means November _, 2008.

Part. 4. Certain Voting Matters. Whether the vote or consent of the holders of a plurality,

majority or other portion of the shares of the Series D Preferred Stock and any Voting Parity

Stock has been cast or given on any matter on which the holders of shares of the Series D

Preferred Stock and any Voting Parity Stock are entitled to vote or consent together as a class

shall be determined by the Company by reference to the specified liquidation amount of the

shares of the Series D Preferred Stock voted or with respect to which a consent has been received

as if the Company were liquidated on the record date for such vote or consent, if any, or, in the

absence of a record date, on the date for such vote or consent. For purposes of determining the

voting rights of the holders of the Series D Preferred Stock under Section 7 of the Standard

Provisions forming part of this Certificate of Designations, each holder will be entitled to one

vote for each $10,000 of liquidation preference to which such holder's shares are entitled.

[Remainder ofPage Intentionally Left Blank]

2
IN WITNESS WHEREOF, the Company has caused this Certificate of Designations to

be signed on its behalf by its and attested by its Secretary this _th

day of November, 2008.

American International Group, Inc.

By:

Name:

Title:

ATTEST:

Name:

Title: Secretary

3
ANNEXA

STANDARD PROVISIONS

Section 1. General Matters. Each share of the Series D Preferred Stock shall be identical

in all respects to every other share of the Series D Preferred Stock. The Series D Preferred Stock

shall be perpetual, subject to the provisions of Section 5 of these Standard Provisions that form a

part of the Certificate of Designations. The Series D Preferred Stock (a) shall rank senior to the

Junior Stock in respect of the right to receive dividends and the right to receive payments out of

the assets of the Company upon voluntary or involuntary liquidation, dissolution or winding up

of the Company and (b) shall be of equal rank with Parity Stock as to the right to receive

dividends and the right to receive payments out of the assets of the Company upon voluntary or

involuntary liquidation, dissolution or winding up of the Company.

Section 2. Standard Definitions. As used herein with respect to the Series D Preferred

Stock:

(a) "Applicable Dividend Rate" means 10% per annum.

(b) "Business Combination" means a merger, consolidation, statutory share exchange

or similar transaction that requires the approval of the Company's stockholders.

(c) "Business Day" means any day except Saturday, Sunday and any day on which

banking institutions in the State of New York generally are authorized or required by law or

other governmental actions to close.

(d)

to time.

"Bylaws" means the bylaws of the Company, as they may be amended from time

(e) "Certificate of Designations" means the Certificate of Designations or comparable

instrument relating to the Series D Preferred Stock, of which these Standard Provisions form a

part, as it may be amended from time to time.

(f)

amended.

(g)

(h)

"Charter" means the Company's Restated Certificate of Incorporation, as

"Dividend Period" has the meaning set forth in Section 3(a).

"Dividend Record Date" has the meaning set forth in Section 3(a).

(i) "Original Issue Date" means the date on which shares of the Series D Preferred

Stock are first issued.

G) "Preferred Director" has the meaning set forth in Section 7(b).

(k) "Preferred Stock" means any and all series of serial preferred stock of the

Company, including the Series D Preferred Stock.

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(1) "Share Dilution Amount" has the meaning set forth in Section 3(b).

(m) "Standard Provisions" mean these Standard Provisions that form a part of the

Certificate of Designations relating to the Series D Preferred Stock.

(n) "Trust" means the AIG Credit Facility Trust.

(0) "Voting Parity Stock" means, with regard to any matter as to which the holders of

the Series D Preferred Stock are entitled to vote as specified in Sections 7(a) and 7(b) of these

Standard Provisions that form a part of the Certificate of Designations, any and all series of

Parity Stock upon which like voting rights have been conferred and are exercisable with respect

to such matter.

Section 3. Dividends.

(a) Rate. Holders of the Series D Preferred Stock shall be entitled to receive, on each

share of the Series D Preferred Stock if, as and when declared by the Board of Directors or any

duly authorized committee of the Board of Directors, but only out of assets legally available

therefor, cumulative cash dividends with respect to each Dividend Period (as defined below) at a

rate per annum equal to the Applicable Dividend Rate on (i) the Liquidation Amount per share of

the Series D Preferred Stock and (ii) the amount of accrued and unpaid dividends for any prior

Dividend Period on such share of the Series D Preferred Stock, if any. Such dividends shall

begin to accrue and be cumulative from the Original Issue Date, shall compound on each

subsequent Dividend Payment Date (i.e., no dividends shall accrue on other dividends unless and

until the first Dividend Payment Date for such other dividends has passed without such other

dividends having been paid on such date) and shall be payable quarterly in arrears on each

Dividend Payment Date, commencing with the first such Dividend Payment Date to occur at

least 20 calendar days after the Original Issue Date. In the event that any Dividend Payment

Date would otherwise fall on a day that is not a Business Day, the dividend payment due on that

date will be postponed to the next day that is a Business Day and no additional dividends will

accrue as a result of that postponement. The period from and including any Dividend Payment

Date to, but excluding, the next Dividend Payment Date is a "Dividend Period", pruvided that

the initial Dividend Period shall be the period from and including the Original Issue Date to, but

excluding, the next Dividend Payment Date.

Dividends that are payable on Series D Preferred Stock in respect of any Dividend Period

shall be computed on the basis of a 360-day year consisting of twelve 30-day months. The

amount of dividends payable on Series D Preferred Stock on any date prior to the end of a

Dividend Period, and for the initial Dividend Period, shall be computed on the basis of a 360-day

year consisting of twelve 30-day months, and actual days elapsed over a 30-day month.

Dividends that are payable on Series D Preferred Stock on any Dividend Payment Date

will be payable to holders of record of the Series D Preferred Stock as they appear on the stock

register of the Company on the applicable record date, which shall be the 15th calendar day

immediately preceding such Dividend Payment Date or such other record date fixed by the

Board of Directors or any duly authorized committee of the Board of Directors that is not more

than 60 nor less than 10 days prior to such Dividend Payment Date (each, a "Dividend Record

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Date"). Any such day that is a Dividend Record Date shall be a Dividend Record Date whether

or not such day is a Business Day.

Holders of the Series D Preferred Stock shall not be entitled to any dividends, whether

payable in cash, securities or other property, other than dividends (if any) declared and payable

on the Series D Preferred Stock as specified in this Section 3 (subject to the other provisions of

the Certificate of Designations).

(b) Priority of Dividends. So long as any share of the Series D Preferred Stock

remains outstanding, no dividend or distribution shall be declared or paid on the Common Stock

or any other shares ofJunior Stock (other than dividends payable solely in shares of Common

Stock) or Parity Stock, subject to the immediately following paragraph in the case of Parity

Stock, and no Common Stock, Junior Stock or Parity Stock shall be, directly or indirectly,

purchased, redeemed or otherwise acquired for consideration by the Corporation or any of its

subsidiaries unless all accrued and unpaid dividends for all past Dividend Periods, including the

latest completed Dividend Period (including, if applicable as provided in Section 3(a) above,

dividends on such amount), on all outstanding shares of the Series D Preferred Stock hav.e been

or are contemporaneously declared and paid in full (or have been declared and a sum sufficient

for the payment thereof has been set aside for the benefit of the holders of shares of the Series D

Preferred Stock on the applicable record date). The foregoing limitation shall not apply to (i) a

dividend payable on any Junior Stock in shares of any other Junior Stock, or to the acquisition of

shares of any Junior Stock in exchange for, or through application of the proceeds of the sale of,

shares of any other Junior Stock; (ii) redemptions, purchases or other acquisitions of shares of

Common Stock or other Junior Stock in connection with the administration of any employee

benefit plan in the ordinary course of business (including purchases to offset the Share Dilution

Amount (as defined below) pursuant to a publicly announced repurchase plan) and consistent

with past practice, provided that any purchases to offset the Share Dilution Amount shall in no

event exceed the Share Dilution Amount; (iii) any dividends or distributions of rights or Junior

Stock in connection with a stockholders' rights plan or any redemption or repurchase of rights

pursuant to any stockholders' rights plan; (iv) the acquisition by the Company or any of its

subsidiaries of record ownership in Junior Stock or Parity Stock for the beneficial ownership of

any other persons (other than the Corporation or any of its subsidiaries), including as trustees or

custodians; and (v) the exchange or conversion ofJunior Stock for or into other Junior Stock or

of Parity Stock for or into other Parity Stock (with the same or lesser aggregate liquidation

amount) or Junior Stock, in each case, solely to the extent required pursuant to binding

contractual agreements entered into prior to the Signing Date or any subsequent agreement for

the accelerated exercise, settlement or exchange thereof for Common Stock. "Share Dilution

Amount" means the increase in the number of diluted shares outstanding (determined in

accordance with generally accepted accounting principles in the United States, and as measured

from the date of the Company's consolidated financial statements most recently filed with the

Securities and Exchange Commission prior to the Original Issue Date) resulting from the grant,

vesting or exercise of equity-based compensation to employees and equitably adjusted for any

stock split, stock dividend, reverse stock split, reclassification or similar transaction.

When dividends are not paid (or declared and a sum sufficient for payment thereof set

aside for the benefit of the holders thereof on the applicable record date) on any Dividend

Payment Date (or, in the case of Parity Stock having dividend payment dates different from the

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Dividend Payment Dates, on a dividend payment date falling within a Dividend Period related to

such Dividend Payment Date) in full upon the Series D Preferred Stock and any shares of Parity

Stock, all dividends declared on the Series D Preferred Stock and all such Parity Stock and

payable on such Dividend Payment Date (or, in the case of Parity Stock having dividend

payment dates different from the Dividend Payment Dates, on a dividend payment date falling

within the Dividend Period related to such Dividend Payment Date) shall be declared pro rata so

that the respective amounts of such dividends declared shall bear the same ratio to each other as

all accrued and unpaid dividends per share on the shares of the Series D Preferred Stock

(including, if applicable as provided in Section 3(a) above, dividends on such amount) and all

Parity Stock payable on such Dividend Payment Date (or, in the case of Parity Stock having

dividend payment dates different from the Dividend Payment Dates, on a dividend payment date

falling within the Dividend Period related to such Dividend Payment Date) (subject to their

having been declared by the Board of Directors or a duly authorized committee of the Board of

Directors out of legally available funds and including, in the case of Parity Stock that bears

cumulative dividends, all accrued but unpaid dividends) bear to each other. If the Board of

Directors or a duly authorized committee of the Board of Directors determines not to pay any

dividend or a full dividend on a Dividend Payment Date, the Company will provide written

notice to the holders of the Series D Preferred Stock prior to such Dividend Payment Date.

Subject to the foregoing, and not otherwise, such dividends (payable in cash, securities or

other property) as may be determined by the Board of Directors or any duly authorized

committee of the Board of Directors may be declared and paid on any securities, including

Common Stock and other Junior Stock, from time to time out of any funds legally available for

such payment, and holders of the Series D Preferred Stock shall not be entitled to participate in

any such dividends.

Section 4. Liquidation, Dissolution or Winding Up. In the event of any voluntary or

involuntary liquidation, dissolution or winding up of the affairs of the Company, then, before any

distribution or payment shall be made to the holders of Junior Stock, the holders of the Series D

Preferred Stock and any shares of Preferred Stock ranking on a parity therewith as to liquidation

shall be entitled to be paid in full the respective amounts of the liquidation preferences thereof,

which in the case of the Series D Preferred Stock shall be $10,000.00 per share, plus an amount

equal to all accrued and unpaid dividends to such distribution or payment date, whether or not

earned or declared (including, if applicable, as provided in Section 3(a) above, dividends on such

accrued and unpaid dividends for all prior Dividend Periods). If such payment shall have been

made in full to the holders of the Series D Preferred Stock and any series of Preferred Stock

ranking on a parity therewith as to liquidation, the remaining assets and funds of the Company

shall be distributed among the holders ofJunior Stock, according to their respective rights and

preferences and in each case according to their respective shares. If, upon any liquidation,

dissolution or winding up of the affairs of the Company, the amounts so payable are not paid in

full to the holders of all outstanding shares of the Series D Preferred Stock and any series of

Preferred Stock ranking on a parity therewith as to liquidation, the holders of the Series D

Preferred Stock and any series of Preferred Stock ranking on a parity therewith as to liquidation

shall share ratably in any distribution of assets in proportion to the full amounts to which they

would otherwise be respectively entitled. Neither the consolidation or merger of the Company,

nor the sale, lease or conveyance of all or a part of its assets, shall be deemed a liquidation,

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dissolution or winding up of the affairs of the Company within the meaning of the foregoing

provisions of this Section 4.

Section 5. Redemption.

(a) Optional Redemption. Except as provided in this Section 5(a), the Designated

Preferred Stock shall not be redeemable. At any time that (i) the Trust (or any successor entity

established for the benefit of the United States Treasury) "beneficially owns" less than 30% of

the aggregate voting power of the Company's voting securities and (ii) no holder of the Series D

Preferred Stock controls the Company, the Company may redeem, in whole or in part, at any

time and from time to time, out of funds legally available therefor, the shares of the Series D

Preferred Stock at the time outstanding, upon notice given as provided in Section 5(c) below, the

Series D Preferred Stock in whole or in part at a redemption price equal to 100% of its

Liquidation Amount, plus, except as set forth in the last sentence of the next paragraph, an

amount equal to all accrued and unpaid dividends to such redemption date (including, if

applicable, as provided in Section 3(a) above, dividends on accrued and unpaid dividends for all

prior Dividend Periods). "Control" for purposes of this Section 5(a) means the power to direct

the management and policies of the Company, directly or indirectly, whether through the

ownership of voting securities, by contract, by the power to control the Board of Directors or

otherwise. "Beneficially owns" for purposes of this Section 5(a) is defined in Rule 13d-3 under

the Securities Exchange Act of 1934, as amended to the Signing Date. For the avoidance of

doubt, while there is Board of Directors control (or the potential to gain Board of Directors

control as a result of existing contractual rights) by any holder of the Series D Preferred Stock,

the Company may not redeem any of the Series D Preferred Stock.

The redemption price for any shares of the Series D Preferred Stock shall be payable on

the redemption date to the holder of such shares against surrender of the certificate(s) evidencing

such shares to the Company or its agent. Any declared but unpaid dividends payable on a

redemption date that occurs subsequent to the Dividend Record Date for a Dividend Period shall

not be paid to the holder entitled to receive the redemption price on the redemption date, but

rather shall be paid to the holder of record of the redeemed shares on such Dividend Record Date

relating to the Dividend Payment Date as provided in Section 3 above.

(b) No Sinking Fund. The Series D Preferred Stock will not be subject to any

mandatory redemption, sinking fund or other similar provisions. Holders of the Series D

Preferred Stock will have no right to require redemption or repurchase of any shares of the Series

D Preferred Stock.

(c) Notice of Redemption. Notice of every redemption ofshares of the Series D

Preferred Stock shall be given by first class mail, postage prepaid, addressed to the holders of

record of the shares to be redeemed at their respective last addresses appearing on the books of

the Company. Such mailing shall be at least 30 days and not more than 60 days before the date

fixed for redemption. Any notice mailed as provided in this Subsection shall be conclusively

presumed to have been duly given, whether or not the holder receives such notice, but failure

duly to give such notice by mail, or any defect in such notice or in the mailing thereof, to any

holder of shares of the Series D Preferred Stock designated for redemption shall not affect the

validity of the proceedings for the redemption of any other shares of the Series D Preferred

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Stock. Notwithstanding the foregoing, if shares of the Series D Preferred Stock are issued in

book-entry form through The Depository Trust Corporation or any other similar facility, notice

of redemption may be given to the holders of the Series D Preferred Stock at such time and in

any manner permitted by such facility. Each notice of redemption given to a holder shall state:

(1) the redemption date; (2) the number of shares of the Series D Preferred Stock to be redeemed

and, if less than all the shares held by such holder are to be redeemed, the number of such shares

to be redeemed from such holder; (3) the redemption price; and (4) the place or places where

certificates for such shares are to be surrendered for payment of the redemption price, but failure

duly to give such notice to any holder of shares of the Series D Preferred Stock designated for

redemption or any defect in such notice shall not affect the validity of the proceedings for the

redemption of any other shares of the Series D Preferred Stock.

(d) Partial Redemption. In case of any redemption of part of the shares of the Series

D Preferred Stock at the time outstanding, the shares to be redeemed shall be selected either pro

rata or in such other manner as the Board of Directors or a duly authorized committee thereof

may determine to be fair and equitable. Subject to the provisions hereof, the Board of Directors

or a duly authorized committee thereof shall have full power and authority to prescribe the terms

and conditions upon which shares of the Series D Preferred Stock shall be redeemed from time to

time. Iffewer than all the shares represented by any certificate are redeemed, a new certificate

shall be issued representing the unredeemed shares without charge to the holder thereof.

(e) Effectiveness of Redemption. If notice of redemption has been duly given and if

on or before the redemption date specified in the notice all funds necessary for the redemption

have been deposited by the Company, in trust for the pro rata benefit of the holders of the shares

called for redemption, with a bank or trust company doing business in the Borough of

Manhattan, The City of New York, and having a capital and surplus of at least $500 million and

selected by the Board of Directors, so as to be and continue to be available solely therefor, then,

notwithstanding that any certificate for any share so called for redemption has not been

surrendered for cancellation, on and after the redemption date dividends shall cease to accrue on

all shares so called for redemption, all shares so called for redemption shall no longer be deemed

outstanding and all rights with respect to such shares shall forthwith on such redemption date

cease and terminate, except only the right of the holders thereof to receive the amount payable on

such redemption from such bank or trust company, without interest. Any funds unclaimed at the

end of three years from the redemption date shall, to the extent permitted by law, be released to

the Company, after which time the holders of the shares so called for redemption shall look only

to the Company for payment of the redemption price ofsuch shares.

(f) Status of Redeemed Shares. Shares of the Series D Preferred Stock that are

redeemed, repurchased or otherwise acquired by the Company shall revert to authorized but

unissued shares of the Series D Preferred Stock (provided that any such cancelled shares of the

Series D Preferred Stock may be reissued only as shares of any series of the Series D Preferred

Stock other than the Series D Preferred Stock).

Section 6. Conversion. Holders of the Series D Preferred Stock shares shall have no right

to exchange or convert such shares into any other securities.

Section 7. Voting Rights.

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(a) General. The holders of the Series D Preferred Stock shall not have any voting

rights except as set forth below or as otherwise from time to time required by law.

(b) Series D Preferred Stock Directors. Whenever, at any time or times, dividends

payable on the shares of the Series D Preferred Stock have not been paid for an aggregate of four

quarterly Dividend Periods or more, whether or not consecutive, the authorized number of

directors of the Company shall automatically be increased to accommodate the number of the

Preferred Directors specified below and the holders of the Series D Preferred Stock shall have

the right, with holders of shares of anyone or more other classes or series of Voting Parity Stock

outstanding at the time, voting together as a class, to elect the greater of two directors and a

number of directors (rounded upward) equal to 20% of the total number of directors of the

Company after giving effect to such election (hereinafter the "Preferred Directors" and each a

"Preferred Director") to fill such newly created directorships at the Company's next annual

meeting ofstockholders (or at a special meeting called for that purpose prior to such next annual

meeting) and at each subsequent annual meeting of stockholders until all accrued and unpaid

dividends for all past Dividend Periods, including the latest completed Dividend Period

(including, if applicable as provided in Section 3(a) above, dividends on such amount), on all

outstanding shares of the Series D Preferred Stock have been declared and paid in full at which

time such right shall terminate with respect to the Series D Preferred Stock, except as herein or

by law expressly provided, subject to revesting in the event of each and every subsequent

payment failure of the character above mentioned; provided that it shall be a qualification for

election for any Preferred Director that the election of such Preferred Director shall not cause the

Company to violate any corporate governance requirements of any securities exchange or other

trading facility on which securities of the Company may then be listed or traded that listed or

traded companies must have a majority of independent directors. Upon any termination of the

right of the holders of shares of the Series D Preferred Stock and Voting Parity Stock as a class

to vote for directors as provided above, the Preferred Directors shall cease to be qualified as

directors, the term of office of all Preferred Directors then in office shall terminate immediately

and the authorized number of directors shall be reduced by the number of the Preferred Directors

elected pursuant hereto. Any Preferred Director may be removed at any time, with or without

cause, and any vacancy created thereby may be filled, only by the affirmative vote of the holders

a majority of the shares of the Series D Preferred Stock at the time outstanding voting separately

as a class together with the holders of shares of Voting Parity Stock, to the extent the voting

rights of such holders described above are then exercisable. If the office of any Preferred

Director becomes vacant for any reason other than removal from office as aforesaid, the

remaining Preferred Director may choose a successor who shall hold office for the unexpired

term in respect of which such vacancy occurred.

(c) Class Voting Rights as to Particular Matters. So long as any shares of the Series D

Preferred Stock are outstanding, in addition to any other vote or consent of stockholders required

by law or by the Charter, the vote or consent of the holders of at least 66 2/3% of the shares of

the Series D Preferred Stock at the time outstanding, voting as a separate class, given in person

or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose,

shall be necessary for effecting or validating:

(i) Authorization of Senior or Pari Passu Stock. Any amendment or alteration

of the Certificate of Designations for the Series D Preferred Stock or the Charter to

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authorize or create or increase the authorized amount of, or any issuance of, any shares

of, or any securities convertible into or exchangeable or exercisable for shares of, any

class or series of capital stock of the Company ranking senior to or pari passu with Series

D Preferred Stock with respect to either or both the payment of dividends and/or the

distribution of assets on any liquidation, dissolution or winding up of the Company;

provided that no such vote or consent of the holders of the Series D Preferred Stock shall

be required for the issuance of the Convertible Preferred Stock;

(ii) Amendment of the Series D Preferred Stock. Any amendment, alteration

or repeal of any provision of the Certificate of Designations for the Series D Preferred

Stock or the Charter (including, unless no vote on such merger or consolidation is

required by Section 7(c)(iii) below, any amendment, alteration or repeal by means of a

merger, consolidation or otherwise) so as to adversely affect the rights, preferences,

privileges or voting powers of the Series D Preferred Stock; or

(iii) Share Exchanges, Reclassifications, Mergers and Consolidations. Any

consummation of a binding share exchange or reclassification involving the Series D

Preferred Stock, or of a merger or consolidation of the Company with or into another

corporation or other entity, unless in each case (x) the shares of the Series D Preferred

Stock remain outstanding and are not amended in any respect or, in the case of any such

merger or consolidation with respect to which the Company is not the surviving or

resulting entity, are converted into or exchanged for preference securities of the surviving

or resulting entity or its ultimate parent, and (y) such shares remaining outstanding or

such preference securities, as the case may be, have such rights, preferences, privileges

and voting powers, and limitations and restrictions thereof, taken as a whole, as are not

materially less favorable to the holders thereof than the rights, preferences, privileges and

voting powers, and limitations and restrictions thereof, of the Series D Preferred Stock

immediately prior to such consummation, taken as a whole;

provided, however, that for all purposes of this Section 7(c), any increase in the amount of the

authorized Preferred Stock, including any increase in the authorized amount of the Series D

Preferred Stock necessary to satisfy preemptive or similar rights granted by the Company to

other persons prior to the Signing Date, or the creation and issuance, or an increase in the

authorized or issued amount, whether pursuant to preemptive or similar rights or otherwise, of

any other series of the Preferred Stock, or any securities convertible into or exchangeable or

exercisable for any other series of the Preferred Stock, ranking junior to the Series D Preferred

Stock with respect to the payment of dividends (whether such dividends are cumulative or noncumulative) and the distribution of assets upon liquidation, dissolution or winding up of the

Company will not be deemed to adversely affect the rights, preferences, privileges or voting

powers, and shall not require the affirmative vote or consent of, the holders of outstanding shares

of the Series D Preferred Stock.

(d) Changes after Provision for Redemption. No vote or consent of the holders of the

Series D Preferred Stock shall be required pursuant to Section 7(c) above if, at or prior to the

time when any such vote or consent would otherwise be required pursuant to such Section, all

outstanding shares of the Series D Preferred Stock shall have been redeemed, or shall have been

A-8
called for redemption upon proper notice and sufficient funds shall have been deposited in trust

for such redemption, in each case pursuant to Section 5 above.

(e) Procedures for Voting and Consents. The rules and procedures for calling and

conducting any meeting of the holders of the Series D Preferred Stock (including, without

limitation, the fixing of a record date in connection therewith), the solicitation and use of proxies

at such a meeting, the obtaining of written consents and any other aspect or matter with regard to

such a meeting or such consents shall be governed by any rules of the Board of Directors or any

duly authorized committee of the Board of Directors, in its discretion, may adopt from time to

time, which rules and procedures shall conform to the requirements of the Charter, the Bylaws,

and applicable law and the rules of any national securities exchange or other trading facility on

which Series D Preferred Stock is listed or traded at the time.

Section 8. Record Holders. To the fullest extent permitted by applicable law, the

Company and the transfer agent for Series D Preferred Stock may deem and treat the record

holder of any share of the Series D Preferred Stock as the true and lawful owner thereof for all

purposes, and neither the Company nor such transfer agent shall be affected by any notice to the

contrary.

Section 9. Notices. All notices or communications in respect of the Series D Preferred

Stock shall be sufficiently given if given in writing and delivered in person or by first class mail,

postage prepaid, or if given in such other manner as may be permitted in this Certificate of

Designations, in the Charter or Bylaws or by applicable law. Notwithstanding the foregoing, if

shares of the Series D Preferred Stock are issued in book-entry form through The Depository

Trust Company or any similar facility, such notices may be given to the holders of the Series D

Preferred Stock in any manner permitted by such facility.

Section 10. No Preemptive Rights. No holder of the Series D Preferred Stock shall be

entitled as a matter of right to subscribe for or purchase, or have any preemptive right with

respect to, any part of any new or additional issue of stock of any class whatsoever, or of

securities convertible into any stock of any class whatsoever, whether now or hereafter

authorized and whether issued for cash or other consideration or by way of divider-d.

Section 11. Replacement Certificates. The Company shall replace any mutilated

certificate at the holder's expense upon surrender of that certificate to the Company. The

Company shall replace certificates that become destroyed, stolen or lost at the holder's expense

upon delivery to the Company of reasonably satisfactory evidence that the certificate has been

destroyed, stolen or lost, together with any indemnity that may be reasonably required by the

Company.

Section 12. Form.

(a) The Series D Preferred Stock shall be initially issued in the form of one or more

certificates in defmitive, fully registered form with, until such time as otherwise determined by

the Company, the restricted shares legend (the "Restricted Shares Legend"), as set forth on the

form of the Series D Preferred Stock attached hereto as Exhibit A (each, a "Series D Preferred

Share Certificate"), which is hereby incorporated in and expressly made a part of this Certificate

A-9
of Designations. The Series D Preferred Share Certificate may have notations, legends or

endorsements required by law, stock exchange rules, agreements to which the Company is

subject, if any, or usage (provided that any such notation, legend or endorsement is in a form

acceptable to the Company).

(b) An Officer shall sign the Series D Preferred Share Certificate for the Company, in

accordance with the Company's Bylaws and applicable law, by manual or facsimile signature.

"Officer" means the Chairman, any Vice President, the Treasurer or the Secretary of the

Company.

(c) If an Officer whose signature is on a Series D Preferred Share Certificate no

longer holds that office at the time the of the issuance of such Series D Preferred Share

Certificate, such Series D Preferred Share Certificate shall be valid nevertheless.

(d) A Series D Preferred Share Certificate shall not be valid or obligatory until an

authorized signatory of the Transfer Agent manually countersigns the Series D Preferred Share

Certificate. The signature shall be conclusive evidence that such Series D Preferred Share

Certificate has been authenticated under this Certificate of Designations. Each Series D

Preferred Share Certificate shall be dated the date of its authentication.

Other than upon original issuance, all transfers and exchanges of the Designated

Preferred Stock shall be made by direct registration on the books and records of the Company.

Section 13. Transfer Agent And Registrar. The duly appointed Transfer Agent and

Registrar for the Series D Preferred Stock shall be Wells Fargo Bank, N.A. The Company may,

in its sole discretion, remove the Transfer Agent in accordance with the agreement between the

Company and the Transfer Agent; provided that the Company shall appoint a successor transfer

agent who shall accept such appointment prior to the effectiveness of such removal.

Section 14. Other Rights. The shares of the Series D Preferred Stock shall not have

any rights, preferences, privileges or voting powers or relative, participating, optional or other

special rights, or qualifications, limitations or restrictions thereof, other than as set forth herein or

in the Charter or as provided by applicable law.

A-lO
EXHIBIT A

FORM OF SERIES D FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK

($10,000 LIQUIDATION PREFERENCE)

NUMBER

1

SHARES

4,000,000

CUSIP[ _

AMERICAN INTERNATIONAL GROUP, INC.

INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE

TillS CERTIFICATE IS TRANSFERABLE

IN THE CITY OF NEW YORK, NEW YORK

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN

REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE

"SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE

TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A

REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT

AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION

FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS. EACH PURCHASER OF

THE SECURITIES REPRESENTED BY THIS INSTRUMENT IS NOTIFIED THAT THE

SELLER MAY BE RELYING ON THE EXEMPTION FROM SECTION 5 OF THE

SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. ANY TRANSFEREE OF

THE SECURITIES REPRESENTED BY THIS INSTRUMENT BY ITS ACCEPTANCE

HEREOF (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS

DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (2) AGREES THAT IT WILL

NOT OFFER, SELL OR OTHERWISE TRANSFER THE SECURITIES REPRESENTED BY

THIS INSTRUMENT EXCEPT (A) PURSUANT TO A REGISTRATION STATEMENT

WHICH IS THEN EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO LONG AS

THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE ELIGIBLE FOR

RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A

"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE

SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE

ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN

THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO THE

ISSUER OR (D) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE

REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT

IT WILL GIVE TO EACH PERSON TO WHOM THE SECURITIES REPRESENTED BY

THIS INSTRUMENT ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE

EFFECT OF THIS LEGEND.

This is to certify that the UNITED STATES DEPARTMENT OF THE TREASURY is

the owner of FOUR MILLION (4,000,000) fully paid and non-assessable shares of Series D

Fixed Rate Cumulative Perpetual Preferred Stock, $5.00 par value, liquidation preference

E-l
$10,000 per share (the "Stock"), of the American International Group, Inc. (the "Company"),

transferable on the books of the Company by the holder hereof in person or by duly authorized

attorney upon surrender of this certificate properly endorsed.

This certificate is not valid or obligatory for any purpose unless countersigned and

registered by the Transfer Agent and Registrar.

Witness the facsimile seal of the Company and the facsimile signatures of its duly

authorized officers.

Dated: November _, 2008

Name:

Title:

Name:

Title:

Countersigned and Registered

as Transfer Agent and Registrar

By: ---------------- Authorized Signature

A-2
AMERICAN INTERNATIONAL GROUP, INC.

AMERICAN INTERNATIONAL GROUP, INC. (the "Company") will furnish, without charge to each

stockholder who so requests, a copy of the certificate of designations establishing the powers, preferences and

relative, participating, optional or other special rights of each class of stock of the Company or series thereof and the

qualifications, limitations or restrictions of such preferences and/or rights applicable to each class of stock of the

Company or series thereof. Such information may be obtained by a request in writing to the Secretary of the

Company at its principal place of business.

This certificate and the share or shares represented hereby are issued and shaH be held subject to all of the

provisions of the Company's Restated Certificate of Incorporation, as amended, and the Certificate of Designations

of the Series D Fixed Rate Cumulative Perpetual Preferred Stock (Liquidation Preference $10,000 per share) (copies

of which are on file with the Transfer Agent), to all of which the holder, by acceptance hereof, assents.

The foIlowing abbreviations, when used in the inscription on the face of this certificate, shaIl be construed

as though they were written out in full to applicable laws or regulations:

TEN COM - as tenants in common

TEN ENT - as tenants by the entireties

JT TEN - as joint tenants with right of

survivorship and not as

tenants in common

UNIF GIFT MIN ACT- Custodian

(Minor) (Cust)

under Uniform Gifts to Minors Act

(State)

Additional abbreviations may also be used though not in the above list.

For value received, hereby sell(s), assign(s) and transfer(s) unto

PLEASE INSERT SOCIAL SECURITY OR OTHER

IDENTIFYING NUMBER OF ASSIGNEE

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE

_______________________________shares

of the capital stock represented by the within certificate, and do(es) hereby irrevocably constitute and appoint

__________, Attorney to transfer the said stock on the books of the within named Company with

fuIl power of substitution in the premises.

A-3
Dated _

Signature

NOTICE: The signature to this assignment must correspond

with the name as written upon the face of this

certificate in every particular, without

alteration or enlargement or any change whatever.

SIGNATURE GUARANTEED

NOTICE: The signature(s) should be

guaranteed by an eligible guarantor

institution (banks, stockbrokers, savings

and loan associations, and credit unions

with membership in an approved signature

guarantee medallion program), pursuant to

Rule 17Ad-iS under the Securities

Exchange Act of 1934.

A-4
•
AnnexB

WARRANT TO PURCHASE COMMON STOCK

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT

BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS

AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT

BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT

WHILE A REGISTRATION STATEMENT RELATING THERETO IS IN

EFFECT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES

LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION

UNDER SUCH ACT OR SUCH LAWS. THIS INSTRUMENT IS ISSUED

SUBJECT TO THE RESTRICTIONS ON TRANSFER AND OTHER

PROVISIONS OF A SECURITIES PURCHASE AGREEMENT BETWEEN

THE ISSUER OF THESE SECURITIES AND THE INVESTOR REFERRED

TO THEREIN, A COPY OF WHICH IS ON FILE WITH THE ISSUER. THE

SECURITIES REPRESENTED BY THIS INSTRUMENT MAY NOT BE SOLD

OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID

AGREEMENT. ANY SALE OR OTHER TRANSFER NOT IN COMPLIANCE

WITH SAID AGREEMENT WILL BE VOID.

WARRANT

to purchase

53,798,766

Shares of Common Stock

of AMERICAN INTERNATIONAL GROUP, INC.

Issue Date: November [ ], 2008

1. Definitions. Unless the context otherwise requires, when used

herein the following terms shall have the meanings indicated.

"Affiliate" has the meaning ascribed to it in the Purchase Agreement.

"Appraisal Procedure" means a procedure whereby two independent

appraisers, one chosen by the Company and one by the Original Warrantholder,

shall mutually agree upon the determinations then the subject of appraisal. Each

party shall deliver a notice to the other appointing its appraiser within 15 days

after the Appraisal Procedure is invoked. If within 30 days after appointment of

the two appraisers they are unable to agree upon the amount in question, a third

independent appraiser shall be chosen within 10 days thereafter by the mutual

consent of such first two appraisers. The decision of the third appraiser so

appointed and chosen shall be given within 30 days after the selection of such

third appraiser. Ifthree appraisers shall be appointed and the determination of one

appraiser is disparate from the middle determination by more than twice the

amount by which the other determination is disparate from the middle

determination, then the determination of such appraiser shall be excluded, the

(NY) 07865/002ffARPIAIG.warrant.doc IlI18108 9:30 PM
remaining two determinations shall be averaged and such average shall be binding

and conclusive upon the Company and the Original Warrantholder; otherwise, the

average of all three determinations shall be binding upon the Company and the

Original Warrantholder. The costs of conducting any Appraisal Procedure shall be

borne by the Company.

"Board ofDirectors" means the board of directors of the Company,

including any duly authorized committee thereof.

"Business Combination" means a merger, consolidation, statutory share

exchange or similar transaction that requires the approval of the Company's

stockholders.

"business day" means any day except Saturday, Sunday and any day on

which banking institutions in the State of New York generally are authorized or

required by law or other governmental actions to close.

"Capital Stoc'k:' means (A) with respect to any Person that is a corporation

or company, any and aU shares, interests, participations or other equivalents

(however designated) of capital or capital stock of such Person and (B) with

respect to any Person that is not a corporation or company, any and all partnership

or other equity interests of such Person.

"Charter" means, with respect to any Person, its certificate or articles of

incorporation, articles of association, or similar organizational document.

"Charter Amendment" means the amendments to the Company's Restated

Certificate of Incorporation to reduce the par value of the Common Stock to

$0.000001 per share and increase the number of authorized shares of Common

Stock to 19 billion.

"Common Stock" has the meaning ascribed to it in the Purchase

Agreement.

"Company" means the American International Group, Inc.

"conversion" has the meaning set forth in Section 13(C).

"convertible securities" has the meaning set forth in Section 13(C).

"Exchange Act" means the Securities Exchange Act of 1934, as amended,

or any successor statute, and the rules and regulations promulgated thereunder.

"Exercise Price" means, with respect to this Warrant, initially, $2.50, and

upon the effectiveness of the Charter Amendment, the amended par value per

share of Common Stock.

2

•

•

(NY) 078651OO2ffARPIAIG.warrant.doc 1I/18108 9:30 PM
"Expiration Time" has the meaning set forth in Section 3.

"Fair Market Value" means, with respect to any security or other property,

the fair market value of such security or other property as determined by the ..

Board of Directors, acting in good faith or, with respect to Section 14, as

determined by the Original Warrantholder acting in good faith. For so long as the

Original Warrantholder holds this Warrant or any portion thereof, it may object in

writing to the Board of Director's calculation of fair market value within 10 days

of receipt of written notice thereof. If the Original Warrantholder and the

Company are unable to agree on fair market value during the lO-day period

following the delivery of the Original Warrantholder's objection, the Appraisal

Procedure may be invoked by either party to determine Fair Market Value by

delivering written notification thereof not later than the 30th day after delivery of

the Original Warrantholder's objection.

"Governmental Entities" has the meaning ascribed to it in the Purchase

Agreement.

"Initial Number" has the meaning set forth in Section 13(C).

"Issue Date" means November [ ], 2008.

"Market Price" means, with respect to a particular security, on any given

day, the last reported sale price regular way or, in case no such reported sale takes

place on such day, the average of the last closing bid and ask prices regular way,

in either case on the principal national securities exchange on which the

applicable securities are listed or admitted to trading, or if not listed or admitted to

trading on any national securities exchange, the average of the closing bid and ask

prices as furnished by two members of the Financial Industry Regulatory

Authority, Inc. selected from time to time by the Company for that purpose.

"Market Price" shall be determined without reference to after hours or extended

hours trading. If such security is not listed and traded in a manner that the

quotations referred to above are available for the period required hereunder, the

Market Price per share of Common Stock shall be deemed to be (i) in the event

that any portion of the Warrant is held by the Original Warrantholder, the fair

market value per share of such security as determined in good faith by the

Original Warrantholder or (ii) in all other circumstances, the fair market value per

share of such security as determined in good faith by the Board of Directors in

reliance on an opinion of a nationally recognized independent investment banking

corporation retained by the Company for this purpose and certified in a resolution

to the Warrantholder. For the purposes of determining the Market Price of the

Common Stock on the "trading day" preceding, on or following the occurrence of

an event, (i) that trading day shall be deemed to commence immediately after the

regular scheduled closing time of trading on the New York Stock Exchange or, if

trading is closed at an earlier time, such earlier time and (ii) that trading day shall

3

(NY) 078651OO2!TARP/AIG.warranl.doc 11/18/089:30 PM
end at the next regular scheduled closing time, or if trading is closed at an earlier

time, such earlier time (for the avoidance of doubt, and as an example, if the

Market Price is to be determined as of the last trading day preceding a specified

event and the closing time of trading on a particular day is 4:00 p.~. and the

specified event occurs at 5:00 p.m. on that day, the Market Price would be

determined by reference to such 4:00 p.m. closing price).

"Original Warrantholder" means the United States Department of the

Treasury. Any actions specified to be taken by the Original Warrantholder

hereunder may only be taken by such Person and not by any other Warrantholder.

"Permitted Transactions" has the meaning set forth in Section 13(C).

"Person" has the meaning given to it in Section 3(a)(9) of the Exchange

Act and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act.

"Per Share Fair Market Value" has the meaning set forth in Section 13(D).

"Preferred Shares" means the perpetual preferred stock issued to the

Original Warrantholder on the Issue Date pursuant to the Purchase Agreement.

"Pro Rata Repurchases" means any purchase of shares of Common Stock

by the Company or any subsidiary thereof pursuant to (A) any tender offer or

exchange offer subject to Section 13(e) or 14(e) of the Exchange Act or

Regulation 14E promulgated thereunder or (B) any other offer available to

substantially all holders of Common Stock, in the case of both (A) or (B), whether

for cash, shares of Capital Stock of the'Company, other securities of the Company,

evidences of indebtedness of the Company or any other Person or any other

property (including, without limitation, shares of Capital Stock, other securities or

evidences of indebtedness of a subsidiary), or any combination thereof, effected

while this Warrant is outstanding. The "Effective Date" of a Pro Rata Repurchase

shall mean the date of acceptance of shares for purchase or exchange by the

Company under any tender or exchange offer which is a Pro Rata Repurchase or

the date of purchase with respect to any Pro Rata Repurchase that is not a tender

or exchange offer.

"Purchase Agreement" means the Securities Purchase Agreement, dated

as of November [ ], 2008, as amended from time to time, between the Company

and the United States Department of the Treasury, including all annexes and

schedules thereto.

"Regulatory Approvals" with respect to the Warrantholder, means, to the

extent applicable and required to permit the Warrantholder to exercise this

Warrant for shares of Common Stock and to own such Common Stock without

the Warrantholder being in violation of applicable law, rule or regulation, the

4

(NY) 078651OO2JTARPIAIG.warranl.doc 111181089:30 PM
receipt of any necessary approvals and authorizations of, filings and registrations

with, notifications to, or expiration or termination of any applicable waiting

period under, the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as

amended, and the rules and regulations thereunder.

"SEC' means the U.S. Securities and Exchange Commission.

"Securities Act" means the Securities Act of 1933, as amended, or any

successor statute, and the rules and regulations promulgated thereunder.

"Shares" has the meaning set forth in Section 2.

"trading day" means (A) if the shares of Common Stock are not traded on

any national or regional securities exchange or association or over-the-counter

market, a business day or (B) if the shares of Common Stock are traded on any

national or regional securities exchange or association or over-the-counter market,

a business day on which such relevant exchange or quotation system is scheduled

to be open for business and on which the shares of Common Stock (i) are not

suspended from trading on any national or regional securities exchange or

association or over-the-counter market for any period or periods aggregating one

half hour or longer; and (ii) have traded at least once on the national or regional

securities exchange or association or over-the-counter market that is the primary

market for the trading of the shares of Common Stock.

"U.S. GAAP" means United States generally accepted accounting

principles.

"Warrantholder" has the meaning set forth in Section 2.

"Warrant" means this Warrant, issued pursuant to the Purchase

Agreement.

2. Number of Shares; Exercise Price. This certifies that, for value

received, the United States Department of the Treasury or its permitted assigns

(the "Warrantholder") is entitled, upon the terms and subject to the conditions

hereinafter set forth, to acquire from the Company, in whole or in part, after the

receipt of all applicable Regulatory Approvals, if any, up to an aggregate of

53,798,766 fully paid and nonassessable shares of Common Stock, at a purchase

price per share of Common Stock equal to the Exercise Price. The number of

shares of Common Stock (the "Shares") and the Exercise Price are subject to

adjustment as provided herein, and all references to "Common Stock," "Shares"

and "Exercise Price" herein shall be deemed to include any such adjustment or

series of adjustments.

5

(NY) 078651002ffARP/AIG.warranl.doc 11118108 9:30 PM
3. Exercise of Warrant; Term. Subject to Section 2, to the extent

permitted by applicable laws and regulations, the right to purchase the Shares

represented by. this Warrant is exercisable, in whole or in part by the

Warrantholder, at any time or from time to time after the execution and delivery

of this Warrant by the Company on the date hereof, but in no event later than 5:00

p.m., New York City time on the tenth anniversary of the Issue Date (the

"Expiration Time"), by (A) the surrender of this Warrant and Notice of Exercise

annexed hereto, duly completed and executed on behalf of the Warrantholder, at

the principal executive office of the Company located at 70 Pine Street, New

York, New York 10270 Attention: Chief Financial Officer (or such other office or

agency of the Company in the United States as it may designate by notice in

writing to the Warrantholder at the address of the Warrantholder appearing on the

books of the Company), and (B) payment of the Exercise Price for the Shares

thereby purchased:

(i) by having the Company withhold, from the shares of Common

Stock that would otherwise be delivered to the Warrantholder upon such exercise,

shares of Common Stock issuable upon exercise of the Warrant equal in value to

the aggregate Exercise Price as to which this Warrant is so exercised based on the

Market Price of the Common Stock on the trading day on which this Warrant is

exercised and the Notice of Exercise is delivered to the Company pursuant to this

Section 3, or

(ii) with the consent of both the Company and the Warrantholder, by

tendering in cash, by certified or cashier's check payable to the order of the

Company, or by wire transfer of immediately available funds to an account

designated by the Company.

If the Warrantholder does not exercise this Warrant in its entirety, the

Warrantholder will be entitled to receive from the Company within a reasonable

time, and in any event not exceeding three business days, a new warrant in

substantially identical form for the purchase of that number of Shares equal to the

difference between the number of Shares subject to this Warrant and the number

of Shares as to which this Warrant is so exercised. Notwithstanding anything in

this Warrant to the contrary, the Warrantholder hereby acknowledges and agrees

that its exercise of this Warrant for Shares is subject to the condition that the

Warrantholder will have first received any applicable Regulatory Approvals.

4. Issuance of Shares; Authorization; Listing. Book-entries

representing Shares issued upon exercise of this Warrant will be promptly

recorded in such name or names as the Warrantholder may designate. The

Company hereby represents and warrants that any Shares issued upon the exercise

of this Warrant in accordance with the provisions of Section 3 will be duly and

validly authorized and issued, fully paid and nonassessable and free from all taxes,

liens and charges (other than liens or charges created by the Warrantholder,

6

(NY) 078651OO2ffARPIAIG.warranl.doc 11/18/089:30 PM
income and franchise taxes incurred in connection with the exercise of the

Warrant or taxes in respect of any transfer occurring contemporaneously

therewith). The Company agrees that the Shares so issued will be deemed to have

been issued to the Warrantholder as of the close of business on the date on which

this Warrant and payment of the Exercise Price are delivered to the Company in

accordance with the terms of this Warrant, notwithstanding that the stock transfer

books of the Company may then be closed. The Company will at all times reserve

and keep available, out of its authorized but unissued Common Stock, solely for

the purpose of providing for the exercise of this Warrant, the aggregate number of

shares of Common Stock then issuable upon exercise of this Warrant at any time.

The Company will (A) procure, at its sole expense, the listing of the Shares

issuable upon exercise of this Warrant at any time, subject to issuance or notice of

issuance, on all principal stock exchanges on which the Common Stock is then

listed or traded and (B) maintain such listings of such Shares at all times after

issuance. The Company will use reasonable best efforts to ensure that the Shares

may be issued without violation of any applicable law or regulation or of any

requirement of any securities exchange on which the Shares are listed or traded.

5. No Fractional Shares or Scrip. No fractional Shares or scrip

representing fractional Shares shall be issued upon any exercise of this Warrant.

In lieu of any fractional Share to which the Warrantholder would otherwise be

entitled, the Warrantholder shall be entitled to receive a cash payment equal to the

Market Price of the Common Stock on the last trading day preceding the date of

exercise less the pro-rated Exercise Price for such fractional share.

6. No Rights as Stockholders; Transfer Books. This Warrant does not

entitle the Warrantholder to any voting rights or other rights as a stockholder of

the Company prior to the date of exercise hereof. The Company will at no time

close its transfer books against transfer of this Warrant in any manner which

interferes with the timely exercise of this Warrant.

7. Charges, Taxes and Expenses. Issuance of Shares to the

Warrantholder upon the exercise of this Warrant shall be made without charge to

the Warrantholder for any issue or transfer tax or other incidental expense in

respect of the issuance of such Shares, all of which taxes and expenses shall be

paid by the Company.

8. Transfer/Assignment.

(A) Subject to compliance with clause (B) of this Section 8, this

Warrant and all rights hereunder are transferable, in whole or in part, upon the

books of the Company by the registered holder hereof in person or by duly

authorized attorney, and a new warrant shall be made and delivered by the

Company, of the same tenor and date as this Warrant but registered in the name of

one or more transferees, upon surrender of this Warrant, duly endorsed, to the

7

(NY) 07865100211'ARP/AIG.warranl.doc 111181089:30 PM
office or agency of the Company described in Section 3. All expenses (other than

stock transfer taxes) and other charges payable in connection with the preparation,

execution and delivery of the new warrants pursuant to this Section 8 shall be paid

by the Company.

(B) The transfer of the Warrant and the Shares issued upon exercise of

the Warrant are subject to the restrictions set forth in Section 4.4 of the Purchase

Agreement. If and for so long as required by the Purchase Agreement, this

Warrant shall contain the legends as set forth in Section 4.2(a) of the Purchase

Agreement.

9. Exchange and Registry of Warrant. This Warrant is exchangeable,

upon the surrender hereof by the Warrantholder to the Company, for a new

warrant or warrants of like tenor and representing the right to purchase the same

aggregate number of Shares. The Company shall maintain a registry showing the

name and address of the Warrantholder as the registered holder of this Warrant.

This Warrant may be surrendered for exchange or exercise in accordance with its

terms, at the office of the Company, and the Company shall be entitled to rely in

all respects, prior to written notice to the contrary, upon such registry.

10. Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by

the Company of evidence reasonably satisfactory to it of the loss, theft,

destruction or mutilation of this Warrant, and in the case of any such loss, theft or

destruction, upon receipt of a bond, indemnity or security reasonably satisfactory

to the Company, or, in the case of any such mutilation, upon surrender and

cancellation of this Warrant, the Company shall make and deliver, in lieu of such

lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and

representing the right to purchase the same aggregate number of Shares as

provided for in such lost, stolen, destroyed or mutilated Warrant.

11. Saturdays, Sundays, Holidays, etc. If the last or appointed day for

the taking of any action or the expiration of any right required or granted herein

shall not be a business day, then such action may be taken or such right may be

exercised on the next succeeding day that is a business day.

12. Rule 144 Information. The Company covenants that it will use its

reasonable best efforts to timely file all reports and other documents required to

be filed by it under the Securities Act and the Exchange Act and the rules and

regulations promulgated by the SEC thereunder (or, if the Company is not

required to file such reports, it will, upon the request of any Warrantholder, make

publicly available such information as necessary to permit sales pursuant to Rule

144 under the Securities Act), and it will use reasonable best efforts to take such

further action as any Warrantholder may reasonably request, in each case to the

extent required from time to time to enable such holder to, if permitted by the

terms of this Warrant and the Purchase Agreement, sell this Warrant without

8

(NY) 078651OO2ffARP/AIG.warrant.doc 11/181089:30 PM
registration under the Securities Act within the limitation of the exemptions

provided by (A) Rule 144 under the Securities Act, as such rule may be amended

from time to time, or (B) any successor rule or regulation hereafter adopted by the

SEC. Upon the written request of any Warrantholder, the Company will deliver to

such Warrantholder a written statement that it has complied with such

requirements.

13. Adjustments and Other Rights. The Exercise Price and the number

of Shares issuable upon exercise of this Warrant shall be subject to adjustment

from time to time as follows; provided, that if more than one subsection of this

Section 13 is applicable to a single event, the subsection shall be applied that

produces the largest adjustment and no single event shall cause an adjustment

under more than one subsection of this Section 13 so as to result in duplication:

(A) Charter Amendment. Upon the effectiveness of the Charter

Amendment, the Exercise Price shall be adjusted from its initial value of $2.50 to

the amended par value per share of Common Stock.

(B) Stock Splits. Subdivisions. Reclassifications or Combinations. If

the Company shall (i) declare and pay a dividend or make a distribution on its

Common Stock in shares of Common Stock, (ii) subdivide or reclassify the

outstanding shares of Common Stock into a greater number of shares, or (iii)

combine or reclassify the outstanding shares of Common Stock into a smaller

number ofshares, the number of Shares issuable upon exercise of this Warrant at

the time of the record date for such dividerid or distribution or the effective date

ofsuch subdivision, combination or reclassification shall be proportionately

adjusted so that the Warrantholder after such date shall be entitled to purchase the

number of shares of Common Stock which such holder would have owned or

been entitled to receive in respect of the shares of Common Stock subject to this

Warrant after such date had this Warrant been exercised immediately prior to such

date. In such event, the Exercise Price in effect at the time of the record date for

such dividend or distribution or the effective date of such subdivision,

combination or reclassification shall be adjusted to the number obtained by

dividing (x) the product of (1) the number of Shares issuable upon the exercise of

this Warrant before such adjustment and (2) the Exercise Price in effect

immediately prior to the record or effective date, as the case may be, for the

dividend, distribution, subdivision, combination or reclassification giving rise to

this adjustment by (y) the new n~mber of Shares issuable upon exercise of the

Warrant determined pursuant to the immediately preceding sentence.

(C) Certain Issuances of Common Shares or Convertible Securities.

Until the earlier of (i) the date on which the Original Warrantholder no longer

holds this Warrant or any portion thereof and (ii) the third anniversary of the Issue

Date, if the Company shall issue shares of Common Stock (or rights or warrants

or other securities exercisable or convertible into or exchangeable (collectively, a

9

(NY) 07865fOO2ffARP/AIG.warrant.doc 111181089:30 PM
"conversion") for shares of Common Stock) (collectively, "convertible securities")

(other than in Permitted Transactions (as defined below) or a transaction to which

subsection (B) of this Section 13 is applicable) without consideration or at a '

consideration per share (or having a conversion price per share) that is less than

90% of the Market Price on the last trading day preceding the date of the

agreement on pricing such shares (or such convertible securities) then, in such

event:

(A) the number of Shares issuable upon the exercise of this Warrant

immediately prior to the date of the agreement on pricing ofsuch shares

(or of such convertible securities) (the "Initial Number") shall be increased

to the number obtained by multiplying the Initial Number by a fraction (A)

the numerator of which shall be the sum of (x) the number of shares of

Common Stock of the Company outstanding on such date and (y) the

number of additional shares of Common Stock issued (or into which

convertible securities may be exercise~ or convert) and (B) the

denominator of which shall be the sum of (I) the number of shares of

Common Stock outstanding on such date and (II) the number of shares of

Common Stock which the aggregate consideration receivable by the

Company for the total number of shares of Common Stock so issued (or

into which convertible securities may be exercised or convert) would

purchase at the Market Price on the last trading day preceding the date of

the agreement on pricing such shares (or such convertible securities); and

(B) the Exercise Price payable upon exercise of the Warrant shall be

adjusted by multiplying such Exercise Price in effect immediately prior to

the date of the agreement on pricing of such shares (or of such convertible

securities) by a fraction, the numerator of which shall be the number of

shares of Cornmon Stock issuable upon exercise of this Warrant prior to

such date and the denominator of which shall be the number ofshares of

Common Stock issuable upon exercise of this Warrant immediately after

the adjustment described in clause (A) above.

For purposes of the foregoing, the aggregate consideration receivable by

the Company in connection with the issuance of such shares of Common Stock or

convertible securities shall be deemed to be equal to the sum of the net offering

price (including the Fair Market Value of any non-cash consideration and after

deduction of any related expenses payable to third parties) of all such securities

plus the minimum aggregate amount, if any, payable upon exercise or conversion

of any such convertible securities into shares of Cornmon Stock; and "Permitted

Transactions" shall mean issuances (i) as consideration for or to fund the

acquisition of businesses andlor related assets, (ii) in connection with employee

benefit plans and compensation related arrangements in the ordinary course and

consistent with past practice approved by the Board of Directors, (iii) in

connection with a public or broadly marketed offering and sale of Cornmon Stock

10

(NY) 07865100zrrARP/AIG,warrant,doc 11118/089:30 PM
or convertible securities for cash conducted by the Company or its affiliates

pursuant to registration under the Securities Act or Rule 144A thereunder on a

basis consistent with capital raising transactions by comparable financial

institutions and (iv) in connection with the exercise of preemptive rights on terms

existing as of the Issue Date. Any adjustment made pursuant to this Section 13(C)

shall become effective immediately upon the date of such issuance.

(D) Other Distributions. In case the Company shall fix a record date for

the making of a distribution to all holders of shares of its Common Stock of

securities, evidences of indebtedness, assets, cash, rights or warrants (excluding

dividends of its Common Stock and other dividends or distributions referred to in

Section 13(B)), in each such case, the Exercise Price in effect prior to such record

date shall be reduced immediately thereafter to the price determined by

multiplying the Exercise Price in effect immediately prior to the reduction by the

quotient of (x) the Market Price of the Common Stock on the last trading day

preceding the first date on which the Common Stock trades regular way on the

principal national securities exchange on which the Common Stock is listed or

admitted to trading without the right to receive such distribution, minus the

amount of cash andlor the Fair Market Value of the securities, evidences of

indebtedness, assets, rights or warrants to be so distributed in respect of one share

of Common Stock (such amount andlor Fair Market Value, the "Per Share Fair

Market Value") divided by (y) such Market Price on such date specified in clause

(x); such adjustment shall be made successively whenever such a record date is

fixed. In such event, the number of Shares issuable upon the exercise of this

Warrant shall be increased to the number obtained by dividing (x) the product of

(1) the number of Shares issuable upon the exercise of this Warrant before such

adjustment, and (2) the Exercise Price in effect immediately prior to the

distribution giving rise to this adjustment by (y) the new Exercise Price

determined in accordance with the immediately preceding sentence. In the event

that such distribution is not so made, the Exercise Price and the number of Shares

issuable upon exercise of this Warrant then in effect shall be readjusted, effective

as of the date when the Board of Directors determines not to distribute such shares,

evidences of indebtedness, assets, rights, cash or warrants, as the case may be, to

the Exercise Price that would then be in effect and the number of Shares that

would then be issuable upon exercise of this Warrant if such record date had not

been fixed.

(E) Certain Repurchases of Common Stock. In case the Company

effects a Pro Rata Repurchase of Common Stock, then the Exercise Price shall be

reduced to the price determined by multiplying the Exercise Price in effect

immediately prior to the Effective Date of such Pro Rata Repurchase by a fraction

of which the numerator shall be (i) the product of (x) the number of shares of

Common Stock outstanding immediately before such Pro Rata Repurchase and (y)

the Market Price of a share of Common Stock on the trading day immediately

preceding the first public announcement by the Company or any of its Affiliates

11

(NY) 07865/o02trARP/AIG.warranl.doc 11/18/08 9:30 PM
of the intent to effect such Pro Rata Repurchase, minus (ii) the aggregate purchase

price of the Pro Rata Repurchase, and of which the denominator shall be the

product of (i) the number ofshares of Common Stock outstanding immediately

prior to such Pro Rata Repurchase minus the number of shares of Common Stock

so repurchased and (ii) the Market Price per share of Common Stock on the

trading day immediately preceding the first public announcement by the Company

or any of its Affiliates of the intent to effect such Pro Rata Repurchase. In such

event, the number of shares of Common Stock issuable upon the exercise of this

Warrant shall be increased to the number obtained by dividing (x) the product of

(1) the number of Shares issuable upon the exercise of this Warrant before such

adjustment, and (2) the Exercise Price in effect immediately prior to the Pro Rata

Repurchase giving rise to this adjustment by (y) the new Exercise Price

determined in accordance with the immediately preceding sentence. For the

avoidance of doubt, no increase to the Exercise Price or decrease in the number of

Shares issuable upon exercise of this Warrant shall be made pursuant to this

Section 13(E).

(F) Business Combinations. In case of any Business Combination or

reclassification of Common Stock (other than a reclassification of Common Stock

referred to in Section 13(B», the Warrantholder's right to receive Shares upon

exercise of this Warrant shall be converted into the right to exercise this Warrant

to acquire the number of shares of stock or other secur~ties or property (including

cash) which the Common Stock issuable (at the time of such Business

Combination or reclassification) upon exercise of this Warrant immediately prior

to such Business Combination or reclassification would have been entitled to

receive upon consummation of such Business Combination or reclassification;

and in any such case, if necessary, the provisions set forth herein with respect to

the rights and interests thereafter of the Warrantholder shall be appropriately

adjusted so as to be applicable, as nearly as may reasonably be, to the

Warrantholder's right to exercise this Warrant in exchange for any shares of stock

or other securities or property pursuant to this paragraph. In determining the kind

and amount of stock, securities or the property receivable upon exercise of this

Warrant following the consummation of such Business Combination, if the

holders of Common Stock have the right to elect the kind or amount of

consideration receivable upon consummation of such Business Combination, then

the consideration that the Warrantholder shall be entitled to receive upon exercise

shall be deemed to be the types and amounts of consideration received by the

majority of all holders of the shares of Common Stock that affirmatively make an

election (or of all such holders if none make an election).

(G) Rounding of Calculations: Minimum Adjustments. All calculations

under this Section 13 shall be made to the nearest one-tenth (l/lOth) of a cent or

to the nearest one-hundredth (l/lOOth) of a share, as the case may be. Any

provision of this Section 13 to the contrary notwithstanding, no adjustment in the

Exercise Price or the number of Shares into which this Warrant is exercisable

12

(NY) 078651OO2fTARP/AIG.warranl.doc 11/181089;30 PM
shall be made if the amount of such adjustment would be less than $0.01 or onetenth (l/10th) of a share of Common Stock, but any such amount shall be carried

forward and an adjustment with respect thereto shall be made at the time of and

together with any subsequent adjustment which, together with such amount and

any other amount or amounts so carried forward, shall aggregate $0.01 or l/lOth

of a share of Common Stock, or more. -

(H) Timing of Issuance of Additional Common Stock Upon Certain

Adjustments. In any case in which the provisions of this Section 13 shall require

that an adjustment shall become effective immediately after a record date for an

event, the Company may defer until the occurrence of such event (i) issuing to the

Warrantholder of this Warrant exercised after such record date and before the

occurrence ofsuch event the additional shares of Common Stock issuable upon

such exercise by reason of the adjustment required by such event over and above

the shares of Common Stock issuable upon such exercise before giving effect to

such adjustment and (ii) paying to such Warrantholder any amount of cash in lieu

of a fractional share of Common Stock; provided, however, that the Company

upon request shall deliver to such Warrantholder a due bill or other appropriate

instrument evidencing such Warrantholder's right to receive such additional

shares, and such cash, upon the occurrence of the event requiring such adjustment.

(I) Other Events. For so long as the Original Warrantholder holds this

Warrant or any portion thereof, if any event occurs as to which the provisions of

this Section 13 are not strictly applicable or, if strictly applicable, would not, in

the good faith judgment of the Board of Directors of the Company, fairly and

adequately protect the purchase rights of the Warrants in accordance with the

essential intent and principles of such provisions, then the Board of Directors

shall make such adjustments in the application of such provisions, in accordance

with such essential intent and principles, as shall be reasonably necessary, in the

good faith opinion of the Board of Directors, to protect such purchase rights as

aforesaid. The Exercise Price and the number of Shares into which this Warrant is

exercisable shall not be adjusted in the event of a change in the par value of the

Common Stock (other than pursuant to the Charter Amendment) or a change in

the jurisdiction of incorporation of the Company.

(J) Statement Regarding Adjustments. Whenever the Exercise Price or

the number of Shares into which this Warrant is exercisable shall be adjusted as

provided in Section 13, the Company shall forthwith file at the principal office of

the Company a statement showing in reasonable detail the facts requiring such

adjustment and the Exercise Price that shall be in effect and the number of Shares

into which this Warrant shall be exercisable after such adjustment, and the

Company shall also cause a copy of such statement to be sent by mail, first class

postage prepaid, to each Warrantholder at the address appearing in the Company's

records.

13

(NY) 078651OO2!fARPIAIG.warrant.doc 11118108 9:30 PM
(K) Notice of Adjustment Event. In the event that the Company shall

propose to take any action of the type described in this Section 13 (but only if the

action of the type described in this Section 13 would result in an adjustment in the

Exercise Price or the number of Shares into which this Warrant is exercisable or a

change in the type of securities or property to be delivered upon exercise of this

Warrant), the Company shall give notice to the Warrantholder, in the manner set

forth in Section 13(1), which notice shall specify the record date, if any, with

respect to any such action and the approximate date on which such action is to

take place. Such notice shall also set forth the facts with respect thereto as shall be

reasonably necessary to indicate the effect on the Exercise Price and the number,

kind or class of shares or other securities or property which shall be deliverable

upon exercise of this Warrant. In the case of any action which would require the

fixing of a record date, such notice shall be given at least 10 days prior to the date

so fixed, and in case of all other action, such notice shall be given at least 15 days

prior to the taking of such proposed action. Failure to give such notice, or any

defect therein, shall not affect the legality or validity of any such action.

(L) Proceedings Prior to Any Action Requiring Adjustment. As a

condition precedent to the taking of any action which would require an adjustment

pursuant to this Section 13, the Company shall take any action which may be

necessary, including obtaining regulatory, New York Stock Exchange or

stockholder approvals or exemptions, in order that the Company may thereafter

validly and legally issue as fully paid and nonassessable all shares of Common

Stock that the Warrantholder is entitled to receive upon exercise of this Warrant

pursuant to this Section 13.

(M) Adjustment Rules. Any adjustments pursuant to this Section 13

shall be made successively whenever an event referred to herein shall occur. If an

adjustment in Exercise Price made hereunder would reduce the Exercise Price to

an amount below par value of the Common Stock, then such adjustment in

Exercise Price made hereunder shall reduce the Exercise Price to the par value of

the Common Stock.

14. Exchange. At any time following the date on which the shares of

Common Stock of the Company are no longer listed or admitted to trading on a

national securities exchange (other than in connection with any Business

Combination), the Original Warrantholder may cause the Company to exchange

all or a portion of this Warrant for an economic interest (to be determined by the

Original Warrantholder after consultation with the Company) of the Company

classified as permanent equity under U.S. GAAP having a value equal to the Fair

Market Value of the portion of the Warrant so exchanged. The Original

Warrantholder shall-calculate any Fair Market Value required to be calculated

pursuant to this Section 14, which shall not be subject to the Appraisal Procedure.

14

(NY) 078651OO2ffARPIAIG.wacrant.doc 11118108 9:30 PM
15. No Impairment. The Company will not, by amendment of its

Charter or through any reorganization, transfer of assets, consolidation, merger,

dissolution, issue or sale of securities or any other voluntary action, avoid or seek

to avoid the observance or performance of any of the terms to be observed or

performed hereunder by the Company, but will at all times in good faith assist in

the carrying out of all the provisions of this Warrant and in taking of all such

action as may be necessary or appropriate in order to protect the rights of the

Warrantholder.

16. Governing Law. This Warrant, and the rights and obligations

of the parties hereunder, shall be governed by, and construed and

int~rpreted in accordance with, United States federal law and not the law of

any State. To the extent that a court looks to the laws of any State to

determine or define the United States federal law, it is the intention of the

parties hereto that such court shall look only to the laws of the State of New

York without regard to the rules of conflicts of laws. Each of the Company

and the Warrantholder agrees (a) to submit to the exclusive jurisdiction and

venue of the United States District Court for the District of Columbia for any

action, suit or proceeding arising out of or relating to this Warrant or the

transactions contemplated hereby, and (b) that notice may be served upon

the Company at the address in Section 20 below and upon the

Warrantholder at the address for the Warrantholder set forth in the registry

maintained by the Company pursuant to Section 9 hereof. To the extent

permitted by applicable law, each of the Company and the Warrantholder

hereby unconditionally waives trial by jury in any legal action or proceeding

relating to the Warrant or the transactions contemplated hereby or thereby.

17. Binding Effect. This Warrant shall be binding upon any successors

or assigns of the Company.

18. Amendments. This Warrant may be amended and the observance

of any term of this Warrant may be waived only with the written consent of the

Company and the Warrantholder.

19. Prohibited Actions. The Company agrees that it will not take any

action which would entitle the Warrantholder to an adjustment of the Exercise

Price if the total number of shares of Common Stock issuable after such action

upon exercise of this Warrant, together with all shares of Common Stock then

outstanding and all shares of Common Stock then issuable upon the exercise of all

outstanding options, warrants, conversion and other rights, would exceed the total

number of shares of Common Stock then authorized by its Charter.

20. Notices. Any notice, request, instruction or other document to be

given hereunder by any party to the other will be in writing and will be deemed to

have been duly given (a) on the date of delivery if delivered personally, or by

15

(NY) 07865JOO2JTARPIAIG.warrantdoc 11/181089:30 PM
facsimile, upon confirmation of receipt, or (b) on the second business day

following the date of dispatch if delivered by a recognized next day courier

service. All notices hereunder shall be delivered as set forth below, or pursuant to

such other instructions as may be designated in writing by the party to receive

such notice.

Ifto the Company:

American International Group, Inc.

70 Pine Street

New York, New York 10270

Attention: Chief Financial Officer:

Secretary:

Treasurer:

with a copy to:

Sullivan & Cromwell LLP

125 Broad Street

New York, NY 10004

Attention Robert W. Reeder, III

Michael M. Wiseman

If to the Warrantholder:

United States Department of the Treasury

1500 Pennsylvania Avenue, NW, Room 2312

Washington, D.C. 20220

Attention: Assistant General Counsel (Banking and Finance)

Facsimile: (202) 622-1974

with a copy to:

Davis Polk & Wardwell

450 Lexington Avenue

New York, NY 10017

Attention: John Brandow

21. Entire Agreement. This Warrant contains the entire agreement

between the parties with respect to the subject matter hereof and supersede all

prior and contemporaneous arrangements or undertakings with respect thereto.

[Remainder ofpage intentionally left blank]

16

(NY) 078651002frARPIAIG.warranl.doc 111181089:30 PM
[Form of Notice of Exercise]

Date: _

TO: American International Group, Inc.

RE: Election to Purchase Common Stock

The undersigned, pursuant to the provisions set forth in the attached

Warrant, hereby agrees to subscribe for and purchase the number of shares of the

Common Stock set forth below covered by such Warrant. The undersigned, in

accordance with Section 3 of the Warrant, hereby agrees to pay the aggregate

Exercise Price for such shares of Common Stock in the manner set forth below. A

new warrant evidencing the remaining shares of Common Stock covered by such

Warrant, but not yet subscribed for and purchased, if any, should be issued in the

name set forth below.

Number of Shares of Common Stock _

Method of Payment of Exercise Price (note if cashless exercise pursuant to

Section 3(i) of the Warrant or cash exercise pursuant to Section 3(ii) of the

Warrant, with consent of the Company and the Warrantholder) _

Aggregate Exercise Price: _

Holder:

By:

Name:

Title:

(NY) 078651OO2!fARP/AIG.walTanl.doc 11/181089:30 PM
IN WITNESS WHEREOF, the Company has caused this Warrant to be

duly executed by a duly authorized officer.

Dated: November _. 2008

AMERICAN INTERNATIONAL

GROUP,INC.

By:

Name:

Title:

Attest:

By:

Name:

Title:

[Signature Page to Warrant]

(NY) 078651OO2ITARP/AIG.warranl.doc 11/18/089:30 PM


Please see Tab 8



AMERICAN INTERNATIONAL GROUP, INC.

70 PINE STREET, NEW YORK, N.Y. 10270

TELEPHONE: 12121 770-7000

LAW DEPABTMENT

Wells Fargo Bank, N.A.

Shareowner Services

161 North Concord Exchange

South St. Paul, MN 55075

Attention:

TELEX: 232019

1'ACSDULE: 212 IH4-6894

212 78&-1&84

~ovember25,2008

Re: Issuance of Series D Fixed Rate Cumulative Perpetual Preferred Stock of American

International Group, Inc.

Ladies and Gentlemen:

In accordance with the terms of the Securities Purchase Agreement, dated as of ~ovember 25,

2008 (the "Purchase Agreement"), between American International Group, Inc. (the "Company")

and the United States Department of the Treasury (the "Investor") in connection with the sale by

the Company and the purchase by the Investor of an aggregate of 4,000,000 shares of Series D

Fixed Rate Cumulative Perpetual Preferred Stock (the "Series D Preferred Stock"), of the

Company, and pursuant to resolutions of the Board of Directors of the Company adopted

November 19,2008, you are hereby authorized and directed to original issue in physical

certificate form 4,000,000 shares of Series D Preferred Stock on ~ovember25, 2008. The

registration on the Preferred Certificate is as follows: United States Department of the Treasury,

1500 Pennsylvania Ave,~,Washington, DC 20220. The registration evidencing the issuance of

the Series D Preferred Stock, and any physical certificate hereafter issued evidencing the Series D

Preferred Stock should bear the following restrictive legends:

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN

REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE

"SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE

TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A

REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT

AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION

FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS. EACH PURCHASER OF

THE SECURITIES REPRESENTED BY THIS INSTRUMENT IS NOTIFIED THAT THE

SELLER MAYBE RELYING ON THE EXEMPTION FROM SECTION 5 OF THE

SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. ANY TRANSFEREE OF

THE SECURITIES REPRESENTED BY THIS INSTRUMENT BY ITS ACCEPTANCE

HEREOF (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS

DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (2) AGREES THAT IT WILL

NOT OFFER, SELL OR OTHERWISE TRANSFER THE SECURITIES REPRESENTED BY

THIS INSTRUMENT EXCEPT (A) PURSUANT TO A REGISTRATION STATEMENT

WHICH IS THEN EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO LONG AS THE

SECURITIES REPRESENTED BY THIS INSTRUMENT ARE ELIGffiLE FOR RESALE

PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A

NY12534: I97763.4
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE

SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE

ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN

THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO THE

ISSUER OR (D) PURSUANT TO ANY OTHER AVAlLABLE EXEMPTION FROM THE

REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT

WILL GIVE TO EACH PERSON TO WHOM THE SECURITIES REPRESENTED BY THIS

INSTRUMENT ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF

TillS LEGEND.

AMERICAN INTERNATIONAL GROUP, INC

By:2r1a1Jl i;vA£0Nuvrvv--

Name: athleen E. Shannon

Title: Senior Vice President and Secretary

NY12534:197763.4


SULLIVAN & CROMWELL LLP

TELEPHONE: 1-212-558-4000

FACSiMILE: 1-212-558-3588

WWW.SULLCROM.COM

125 f?JJmad

ey~J JfY'10004-24.98

LOS ANGELES' PALO ALTO' WASHINGTON, D.C.

FRANKFURT' LONDON. PARIS

BEIJING. HONG KONG' TOKYO

MELBOURNE. SYDNEY

November 25, 2008

Wells Fargo Bank, N.A., as Transfer Agent and Registrar,

161 North Concord Exchange Street,

South S1. Paul, MN 55075.

Ladies and Gentlemen:

We deliver to you herewith a copy of our opinion, dated the date hereof

and addressed to the United States Department ofthe Treasury, relating to the purchase

of 4,000,000 shares of Series D Fixed Rate Cumulative Perpetual Preferred Stock, par

value $5.00 per share, of American International Group, Inc. ("AIG") and a warrant to

purchase initially up to 53,798,766 shares ofAIG's common stock, par value $2.50 per

share. Subject to the assumptions and qualifications set forth in the attached opinion, we

hereby authorize you to rely upon paragraphs 1, 2 and 5 in the attached opinion as though

they were addressed and delivered to you.

Very truly yours,

~<f-~~

NY12534:197921.5
SULLNAN & CROMWELL LLP

TELEPHONE: '-212-558-4000

FACSIMILE: 1-212-558-3588

WWW.SUl.LCROM.COM

United States Department ofthe Treasury,

1500 Pennsylvania Avenue, NW,

Washington, D.C. 20220.

Ladies and Gentlemen:

125P/J~~

fiew O/~, JtrP!/1000/J-2498

LOS ANCELES • PALO ALTO' WASHINGTON, D.C.

P'RANKFUAT • LONDON. PARIS

BEUrNG • HONG KONG • TOKYO

MELBOURNE. SYDNE't'

November 25, 2008

In connection with the purchase today by you pursuant to the Securities

Purchase Agreement, dated as ofNovember 25, 2008 (the "Purchase Agreement'1,

between American International Group, Inc., a Delaware corporation (the "Company'1,

and you, of 4,000,000 shares (the "Preferred Shares'1 ofthe Company's Series D Fixed

Rate Cumulative Perpetual Preferred Stock, par value $5.00 per share, and a warrant (the

"Warrant") to purchase initially up to 53,798,766 shares (the "Warrant Shares'1 ofthe

Company's common stock, par value $2.50 per share (the "Common Stock'1, we, as

counsel for the Company, have examined such corporate records, certificates and other

documents, and such questions oflaw, as we have considered necessary or appropriate

for the purposes ofthis opinion. Upon the basis ofsuch examination, it is our opinion

that:

(1) The Company has been duly incorporated and is an existing

corporation in good standing under the laws ofthe State ofDelaware.

(2) The Preferred Shares have been duly authorized and, when issued

and delivered against payment in accordance with the Purchase Agreement, will

be validly issued and fully paid and nonassessable.

(3) The Preferred Shares will not be issued in violation of any

preemptive rights provided for in the Company's Restated Certificate of

Incorporation, as amended to the date ofthis opinion (the ''Restated Certificate of

Incorporation"), or under the General Corporation Law ofthe State ofDelaware.

NY12534:197642.3
United States Department ofthe Treasury -2-

(4) The Warrant has been duly authorized and, when executed and

delivered by the Company, will constitute a valid and legally binding obligation

ofthe Company enforceable against the Company in accordance with its terms,

subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium

and similar laws of general applicability relating to or affecting creditors' rights

and to general equity principles.

(5) The Warrant Shares have been duly authorized and reserved for

issuance upon exercise ofthe Warrant and, when and to the extent issued upon

exercise ofthe Warrant in accordance with the terms and provisions ofthe

Warrant, will be validly issued, fully paid and nonassessable.

(6) The Company has corporate power and authority to execute and

deliver the Purchase Agreement and the Warrant and to perfonn its obligations

thereWlder (including the issuance ofthe Preferred Shares, the Warrant and the

Warrant Shares).

(7) The execution, delivery and performance by the Company ofthe

Purchase Agreement and the Warrant and the consummation ofthe transactions

contemplated thereby have been duly authorized by all necessary corporate action

on the part ofthe Company, and no further corporate action is required on the part

ofthe Company other than the vote ofstockholders to amend the Company's

Restated Certificate ofIncorporation to allow the Preferred Shares to rank senior

to the Company's Series C Perpetual, Convertible, Participating Preferred Stock,

par value $5.00 per share, to be issued to a trust for the benefit ofthe United

States Treasury in connection with the Credit Agreement, dated as of September

22,2008, between the Company and the Federal Reserve Bank ofNew York, and

any other series ofserial preferred stock issued by the Company.

(8) The Purchase Agreement, assuming due authorization, execution

and delivery by you, constitutes a valid and legally binding agreement ofthe

Company enforceable in accordance with its terms, subject to bankruptcy,

insolvency, fraudulent transfer, reorganization, moratorium and similar laws of

general applicability relating to or affecting creditors' rights and general equity

principles; provided, however, that we express no opinion with respect to Section

3.1(b) or Section 4.5(g) ofthe Purchase Agreement or the severability provisions

ofthe Purchase Agreement insofar as Section 3.1(b) or Section 4.5(g) is

concerned.

The foregoing opinion is limited to the laws ofthe State ofNew York and

the General Corporation Law ofthe State ofDelaware, and we are expressing no opinion

as to the effect ofthe laws of any other jurisdiction.

NYl2534:197642.3
United States Department ofthe Treasury -3-

We have relied as to certain matters upon information obtained from

public officials, officers ofthe Company and other sources believed by us to be

responsible, and we have assumed that the certificates for the Preferred Shares conform

to the specimen thereof examined by us and have been duly countersigned by a transfer

agent and duly registered by a registrar ofthe Preferred Shares, that the certificates (if

any) for the Warrant Shares will conform to the specimen thereof examined by us and

will be duly countersigned by a transfer agent and duly registered by a registrar ofthe

Common Stock (and ifthe Warrant Shares are issued in uncertificated form, that they

will be duly recorded by a transfer agent and duly registered by a registrar thereof) and

that the signatures on all documents examined by us are genuine, assumptions which we

have not independently verified.

This opinion is delivered by us to you as counsel to the Company, is solely

for your benefit and may not be delivered or disclosed to any other person without our

prior written consent.

Very truly yours,

NY12534:197642.3


AMERICAN INTERNATIONAL GROUP, INC.

70 PXNE STREET

NEW YORK, N.Y.

KATHLEEN E. SHANNON

SENlOR VICE PRESIDENT, SECRETARY

AND DEPUTY GENERALCOUNSEL

TF.1.: 212-770-5123

FA:": 212-7815-11584

IC\.THt..EE~.5H.\...";":O~·@.-\.J(i.';O~1

November 25, 2008

Wells Fargo Bank, N.A., as Transfer Agent and Registrar,

161 North Concord Exchange Street,

South St. Paul, MN 55075.

Ladies and Gentlemen:

I am Senior Vice President, Secretary and Deputy General Counsel of American

International Group, Inc., a Delaware corporation (the "Company"), and, as such, I am generally

familiar with the corporate affairs ofthe Company.

This opinion is rendered in connection with the purchase by the United States Department

ofthe Treasury of 4,000,000 shares of Series D Fixed Rate Cumulative Perpetual Preferred Stock,

par value $5.00 per share (the "Series D Preferred Stock"), ofthe Company.

In rendering my opinion, I have examined such corporate records, certificates and other

documents, and have reviewed such questions of law under the General Corporation Law ofthe

State ofDelaware, as I have considered necessary or appropriate for the purposes ofthis opinion.

Upon the basis of such examination and review, you are advised that in my opinion the Company

has taken all necessary corporate action to authorize you to act as transfer agent and registrar for its

Series D Preferred Stock.

I have relied as to certain matters upon information obtained from officers ofthe Company

and other sources believed by me to be responsible, and I have assumed that the signatures on all

documents examined by me are genuine, an assumption which I have not independently verified.

The foregoing opinion is limited to the General Corporation Law ofthe State ofDelaware,

and I am expressing no opinion as to the effect ofthe laws of any otherjurisdiction.

This letter is furnished by me, as Senior Vice President, Secretary and Deputy General

Counsel ofthe Company, to you, as Transfer Agent and Registrar ofthe Series D Preferred Stock,

solely for your benefit in your capacity as such, and may not be relied upon by any other person.

This opinion may not be quoted, referred to or furnished to any other person.

Very truly yours,

'11\a ~a~on
•


CERTIFICATE OF PREFERRED STOCK TRANSFER AGENT AND

REGISTRAR

The undersigned, an officer of Wells Fargo Bank, N.A. (the

"Agent"), hereby certifies as follows:

1. The Agent has been duly appointed and qualified to act as the

transfer agent and registrar for the Series D Fixed Rate Cumulative

Perpetual Preferred Stock (the "Series 0 Preferred Stock"), of

American International Group, Inc., a Delaware corporation (the

"Company").

2. As such transfer agent and registrar, and in accordance with the

instructions of the Company, the Agent has on this date duly

countersigned, registered and delivered one certificate representing

4,000,000 shares of Series D Preferred Stock.

3. As such registrar the Agent has on this date registered in the name

of the United States Department of the Treasury the shares of

Series 0 Preferred Stock referred to in paragraph 2 above.

4. The Agent is duly and validly registered as a "transfer agent" under

the Securities Exchange Act of 1934, as amended.

5. Each person who, as an authorized signatory of the Agent,

countersigned and registered the certificate referred to in paragraph

2 above, was duly elected or appointed, qualified and acting as

such authorized signatory at the respective times of the signing,

registration and delivery thereof and was duly authorized to sign

such document or take such action on behalf of it, and the

signature of each person appearing on any such certificate is the

genuine signature of such authorized signatory.

6. The Agent's records indicate that there were no shares of the

Company's serial preferred stock (including Series D Preferred

Stock) issued and outstanding on November 25, 2008 immediately

prior to the issuance by the Company of the 4,000,000 shares of

Series D Preferred Stock.

Attached hereto are excerpts from resolutions of the Agent duly

adopted by its Board of Directors respecting the signing authority of the persons

mentioned above.

NY12534:197771.5
IN WITNESS WHEREOF, I have hereunder affixed my signature on

the 25th day of November, 2008.

NY12534: 197771.5
CERTIFICATION

I, Suzanne M. Swits, an Assistant Secretary of Wells Fargo Bank., National

Association, a national banking association organized under the laws ofthe United States

of America (the "Bank"), hereby certify that:

1. The following resolution was duly adopted by the Board of Directors ofthe Bank

at a meeting thereof held on July 22, 1996, and that said resolution has not been

amended or revoked and remains in full force and effect on the date hereof:

RESOLVED, that instruments, documents or agreements relating to or

affecting the property or business and affairs of this Bank, or of this Bank when

acting in any representative or fiduciary capacity, may be executed in its name,

with or without its corporate seal, by the persons hereinafter designated.

For the purposes of this resolution, "Executive Officer" shall mean any

person specifically designated as an Executive Officer ofthis Bank by resolution

of the Board of Directors, and "Signing Officer" shall mean the Chairman of the

Board, the President, any Vice President (including any Executive Vice President

or any Senior Vice President), the Cashier, the Controller, any Office President,

any Managing Officer, any Assistant Vice President, Assistant Cashier, any

functional title which includes the word "Officer" (e.g., Commercial Banking

Officer, Personal Banking Officer, Trust Officer), or any other functional title

hereinafter designated by the Board of Directors as an officer ofthe Bank.

***

3. Any Signing Officer, acting alone may execute:

***

k. Guaranties of the signatures of customers, or other signatures,

whether appearing as endorsements of bonds, certificates of

stock, other securities, or otherwise.

*** q. Trust indentures, declarations of trust and trust and agency

agreements, acceptances thereof and consents thereto,· and any

similar documents however denominated; petitions for the

appointment or the confirmation of appointment of this Bank. in

any representative or fiduciary capacity; certificates of assets held

in any account of this Bank; certificates of authentication with

respect to bonds, notes, debentures, and other obligations issued

under corporate mortgages, trust agreements and other indentures;

certificates for securities deposited, interim certificates and other
certificates for and on behalf of this Bank. as depository or agent;

countersignatures of bonds, notes, certificates ofstock, voting trust

certificates or participation certificates on behalf of this Bank as

transfer agent or registrar, certificates of cancellation and

cremation of stocks, bonds or other securities; certificates of

incumbency of trustee; and resignations of this Bank in any

representative or fiduciary capacity.

***

2. The following named persons were duly appointed, qualified and acting officers

or designated signers ofthe Bank, that their correct titles and genuine signatures

appear beside their names, and that on said date they were duly authorized to act

on behalf ofthe Bank. as set forth in the foregoing resolutions:

Name Title Si2nature

Joseph F. Connor Vice President

/'~~

IN WITNESS WHEREOF, I have hereunto signed my name and affixed the seal

ofthe Bank. this 25th day ofNovember, 2008.

(Bank. Seal)


8-K

8-K 1 y72888e8vk.htm FORM 8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported) : November 25, 2008

Page 1 of 6

AMERICAN INTERNATIONAL GROUP, INC.

(Exact name ofregistrant

as specified in charter)

DELAWARE

(State or other jurisdiction of

incorporation)

1-8787

(Commission File Number)

13-2592361

(IRS Employer Identification No.)

70 Pine Street, New York, New York 10270

(Address of Principal Executive Offices) (Zip Code)

Registrant's telephone number, including area code: (212) 770-7000

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the

registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 24O.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240. 14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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~-K Page 2 of6

Item 1.01. Entry into a Material Definitive Agreement

Securities Purchase Agreement

On November 25, 2008, American International Group, Inc. ("AIG") entered into a Securities Purchase Agreement (the

"Purchase Agreement") by and between AIG and the United States Department of the Treasury (the "Treasury Department")

pursuant to which, among other things, AIG would issue and sell to the Treasury Department, and the Treasury Department

would purchase, as part of the Troubled Assets Relief Program ("TARP"), for an aggregate purchase price of

$40,000,000,000 (the "Purchase Price"), (i) 4,000,000 shares of Series D Fixed Rate Cumulative Perpetual Preferred Stock,

par value $5.00 per share, of AIG (the "Series D Preferred Stock") and (ii) a warrant to purchase up to 53,798,766 shares of

common stock, par value $2.50 per share (the "Common Stock"), of AIG (the "Warrant" and, together with the Series D

Preferred Stock, the "Securities").

Following execution of the Purchase Agreement, on November 25, 2008 (the "Issue Date"), AIG and the Treasury

Department completed the purchase and sale of the Securities.

The description of the Purchase Agreement contained or incorporated herein is a summary and is qualified in its entirety

by reference to the full text of the Purchase Agreement attached as Exhibit 10.1 hereto, which is incorporated into this

Item 1.01 by reference.

Series D Preferred Stock

Dividends on the Series D Preferred Stock are payable, if, as and when declared by the Board of Directors of AIG (the

"Board"), on a cumulative basis, out of assets legally available therefor, in cash, at the rate per annum of 10 percent of the

liquidation preference of $10,000 per share (the "Liquidation Preference"). The Series D Preferred Stock will rank senior to

the Common Stock. Pursuant to the Purchase Agreement, AIG has agreed to call a special meeting of stockholders to vote on

a proposal to amend AIG's Restated Certificate ofIncorporation to allow the Series D Preferred Stock to rank senior to the

Series C Perpetual, Convertible, Participating Preferred Stock (the "Series C Preferred Stock"), to be issued pursuant to the

Credit Agreement, dated September 22, 2008, as amended from time to time (the "Credit Agreement"), and any other series

of preferred stock issued by AIG. AIG will not be able to declare or pay any dividends on the Common Stock or on any

series of its preferred stock ranking pari passu with, or junior to, the Series D Preferred Stock in any quarter unless all

accrued and unpaid dividends are paid on the Series D Preferred Stock for all past dividend periods (including the latest

completed dividend period), subject to certain limited exceptions.

AIG may redeem the Series D Preferred Stock at the Liquidation Preference, plus accumulated but unpaid dividends, at

any time that the trust established for the benefit of the United States Treasury (the "Trust") pursuant to the Credit

Agreement, or a successor entity, beneficially owns less than 30 percent of AIG's voting securities and no holder of the

Series D Preferred Stock controls or has the potential to control AIG.

Pursuant to the Purchase Agreement, for as long as the Treasury Department owns any of the Series D Preferred Stock,

AIG will be subject to restrictions on its ability to repurchase capital stock, and will be required to adopt and maintain

policies limiting corporate expenses, lobbying activities and executive compensation. As a condition to the closing of the

Securities sale, each of AIG's Senior Executive Officers and other senior employees as required by the Purchase Agreement,

(i) executed a waiver (the "Waiver") voluntarily waiving any claim against the Treasury Department or AIG for any changes

to such Senior Executive Officer's or senior employee's compensation or benefits that are required to comply with the

guidelines issued by the Treasury Department under the TARP Program for Systemically Significant Failing Institutions as

issued on October 14,2008 (the "Guidelines") and the Purchase Agreement, and acknowledging that the Guidelines and the

compensation limits'under the Purchase Agreement may require modification of the compensation, bonus, incentive and

other benefit plans, arrangements and policies and agreements (including so-called "golden parachute" agreements)

(collectively, "Benefit Plans") as they relate to the period the Treasury Department holds any equity or debt securities of AlG

issued pursuant to the Purchase Agreement or the Warrant; and (ii) entered into a letter agreement with AlG amending the

Benefit Plans with respect to such Senior Executive Officer and senior employee as may be necessary, during the period that

the Treasury Department owns any debt or equity securities of AIG issued pursuant to the Purchase Agreement or the

Warrant, as necessary to comply with the Guidelines and the Purchase Agreement.

2

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8-K Page 3 of6

Holders of the Series D Preferred Stock will be entitled to vote for the election of the greater of two additional members of

AIG's Board of Directors and a number of directors (rounded upward) equal to 20 percent of the total number of directors of

AIG if dividends have not been declared and paid for four or more dividend periods, whether or not consecutive.

The description of the Series D Preferred Stock contained herein is a summary and is qualified in its entirety by reference

to the full text ofthe Certificate of Designations, which is attached as Exhibit 3.1 hereto and incorporated into this Item 1.01

by reference.

Warrant

The Warrant will be exercisable for up to 53,798,766 shares of Common Stock, representing two percent of AIG's

Common Stock on November 25, 2008, at an initial exercise price of $2.50 per share (representing the par value of the

Common Stock on the date of investment). The initial exercise price will be adjusted to the par value per share of the

Common Stock following any amendments to AIG's Restated Certificate of Incorporation to reduce the par value per share

of the Common Stock. The ultimate number of shares of Common Stock to be issued under the terms of the Warrant and the

exercise price of the Warrant are also subject to certain customary anti-dilution adjustments as set forth in the Warrant

certificate, including among others, upon the issuances, in certain circumstances, of Common Stock or securities convertible

into Common Stock.

The Warrant will have a term of 10 years and may be exercisable at any time, in whole or in part. The Warrant will not be

subject to any contractual restrictions on transfer other than such as are necessary to ensure compliance with U.S. federal and

state securities laws. The Treasury Department has agreed that it will not exercise any voting rights with respect to the

Common Stock issued upon exercise of the Warrant. AIG will be obligated, at the request of the Treasury Department, to file

a registration statement with respect to the Warrant and the Common Stock for which the Warrant can be exercised. If the

Series D Preferred Stock issued in connection with the Warrant is redeemed in whole or is transferred in whole to one or

more third parties, AIG may repurchase the Warrant then held by the Treasury Department at any time thereafter for its fair

market value so long as no holder of the Warrant controls or has the potential to control AIG. In connection with the issuance

of the Warrant, the number of shares into which the Series C PrefeJ;Ted Stock will be convertible will be reduced to

77.9 percent of the outstanding shares of Common Stock.

The description of the Warrant contained herein is a summary and is qualified in its entirety by reference to the full text of

the Warrant, which is attached as Exhibit 10.2 hereto and incorporated into this Item 1.01.

Item 3.02. Unregistered Sale of Equity Securities.

The issuance and sale of the Securities were exempt from registration under the Securities Act of 1933 pursuant to

Section 4(2) of the Securities Act of 1933.

Item 3.03. Material Modification to Rights of Security Holders

Pursuant to the Purchase Agreement, on November 25, 2008, AIG issued and sold 4,000,000 shares of its Series D

Preferred Stock. The holders of the Series D Preferred Stock will have preferential dividend and liquidation rights over the

holders of Common Stock, and if the stockholder proposal to amend AIG's Restated Certificate ofIncorporation is approved,

over the holders of the Series C Preferred Stock. The applicable terms and preferences attached to the Series D Preferred

Stock are more fully described in Item 1.01 above, and are contained in the Certificate of Designations, which was filed with

the Secretary of State of the State of Delaware on November 24, 2008.

The above summary is qualified in its entirety by reference to the full text of the Certificate of Designations, which is

attached hereto as Exhibit 3.1 and is incorporated herein by reference.

Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year

On November 24, 2008, AIG filed the Certificate of Designations with the Secretary of State of the State of Delaware.

3

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~-K.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

Page 4 of6

Exhibit Number ::::.De~s::::cr.:t:ip::::tio::::.n:....- _

3.1 Certificate of Designations of Series D Fixed Rate Cumulative Perpetual Preferred Stock

10.1 Securities Purchase Agreement, dated as of November 25, 2008

10.2 Warrant issued by American International Group, Inc. to the United States Department of the Treasury, dated as

of November 25, 2008

4

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-Page 50f6

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be

signed on its behalf by the undersigned hereunto duly authorized.

AMERICAN INTERNATIONAL GROUP, INC.

(Registrant)

Date: November 25, 2008 By: lsi Kathleen E. Shannon

Name: Kathleen E. Shannon

Title: Senior Vice President and Secretary

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8-K

EXIllBIT INDEX

Exhibit Number Description

3.1 Certificate of Designations of Series D Fixed Rate Cumulative Perpetual Preferred Stock

10.1 Securities Purchase Agreement, dated as of November 25, 2008

Page 6 of 6

10.2 Warrant issued by American International Group, Inc. to the United States Department of the Treasury. dated as

of November 25, 2008

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EX-3.1

EX-3.1 2 y72888exv3w1.htrn EX-3.1: CERTIFICATE OF DESIGNATIONS

Page 1 of 17

Exhibit 3.1

CERTIFICATE OF DESIGNATIONS

OF

SERIES D FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK

OF

AMERICAN INTERNATIONAL GROUP, INC.

American International Group, Inc., a corporation organized and existing under the General Corporation Law of the State

of Delaware (the "Company"), hereby certifies that the following resolution was adopted by the Board of Directors of the

Company (the "Board of Directors") as required by Section 151 of the General Corporation Law of the State of Delaware at a

meeting duly held on November 19,2008.

RESOLVED, that pursuant to the authority granted to and vested in the Board of Directors in accordance with the

provisions of-the Restated Certificate ofIncorporation, as amended, the Board of Directors hereby creates a series of Serial

Preferred Stock, par value $5.00 per share, of the Company, and hereby states the designation and number ofshares, and

fixes the voting and other powers, and the relative rights and preferences, and the qualifications, limitations and restrictions

thereof, as follows:

Series D Fixed Rate Cumulative Perpetual Preferred Stock:

Part 1. Designation and Number of Shares. There is hereby created out of the authorized and unissued shares of serial

preferred stock of the Company a series of preferred stock designated as the "Series D Fixed Rate Cumulative Perpetual

Preferred Stock" (the "Series D Preferred Stock"). The authorized number ofshares of the Series D Preferred Stock shall be

4,000,000. Such number of shares may be decreased by resolution of the Board of Directors, subject to the terms and

conditions hereof; provided that no decrease shall reduce the number of shares of the Series D Preferred Stock to a number

less than the number of shares then outstanding.

Part 2. Standard Provisions. The Standard Provisions contained in Annex A attached hereto are incorporated herein by

reference in their entirety and shall be deemed to be a part of this Certificate of Designations to the same extent as if such

provisions had been set forth in full herein.

Part. 3. Definitions. The following terms are used in this Certificate of Designations (including the Standard Provisions in

Annex A hereto) as defined below:

(a) "Common Stock" means the common stock, par value $2.50 per share, of the Company.

(b) "Convertible Preferred Stock" means the Series C Perpetual, Convertible, Participating Preferred Stock of the

Company. The Convertible Preferred Stock shall be Parity

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hX-3.1 Page 2 of 17

Stock; provided that the Convertible Preferred Stock shall be Junior Stock following the effectiveness of an amendment to

the Charter to allow the Series D Preferred Stock to rank senior to the Convertible Preferred Stock as to dividends rights

and/or rights upon the liquidation, dissolution and winding up (the "Amendment"),

(c) "Dividend Payment Date" means February I, May I, August 1 and November 1 of each year.

(d) "Junior Stock" means the Common Stock, the Convertible Preferred Stock (following the Amendment) and any other

class or series of stock of the Company the terms of which expressly provide that it ranks junior to the Series D Preferred

Stock as to dividend rights and/or as to rights on liquidation, dissolution or wiIiding up of the Company.

(e) "Liquidation Amount" means $10,000 per share of the Series D Preferred Stock.

(f) "Parity Stock" means the Convertible Preferred Stock (before the Amendment) and any class or series of stock of the

Company (other than the Series D Preferred Stock) the terms of which do not expressly provide that such class or series will

rank senior or junior to the Series D Preferred Stock as to dividend rights and/or as to rights on liquidation, dissolution or

winding up of the Company (in each case without regard to whether dividends accrue cumulatively or non-cumulatively).

(h) "Signing Date" means November 24, 2008.

Part. 4. Certain Voting Matters. Whether the vote or consent of the holders of a plurality, majority or other portion of the

shares of the Series D Preferred Stock and any Voting Parity Stock has been cast or given on any matter on which the holders

of shares of the Series D Preferred Stock and any Voting Parity Stock are entitled to vote or consent together as a class shall

be determined by the Company by reference to the specified liquidation amount of the shares of the Series D Preferred Stock

voted or with respect to which a consent has been received as if the Company were liquidated on the record date for such

vote or consent, if any, or, in the absence of a record date, on the date for such vote or consent. For purposes of determining

the voting rights of the holders of the Series D Preferred Stock under Section 7 of the Standard Provisions forming part of

this Certificate of Designations, each holder will be entitled to one vote for each $10,000 of liquidation preference to which

such holder's shares are entitled.

[Remainder ofPage Intentionally Left Blank]

2

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EX-3.1 Page 3 of 17

IN WITNESS WHEREOF, the Company has caused this Certificate of Designations to be signed on its behalf by its

Executive Vice President and Chief Financial Officer and attested by its Secretary this 24th day of November, 2008.

American International Group, Inc.

By: lsi David L. Herzog

Name: David L. Herzog

Title: Executive Vice President

and Chief Financial Officer

ATTEST:

lsi Kathleen E. Shannon

Name: Kathleen E. Shannon

Title: Senior Vice President and Secretary

3

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EX-3.1 Page 4 of 17

ANNEXA

STANDARD PROVISIONS

Section 1. General Matters. Each share of the Series D Preferred Stock shall be identical in all respects to every other

share of the Series D Preferred Stock. The Series D Preferred Stock shall be perpetual, subject to the provisions of Section 5

of these Standard Provisions that form a part of the Certificate of Designations. The Series D Preferred Stock (a) shall rank

senior to the Junior Stock in respect of the right to receive dividends and the right to receive payments out of the assets of the

Company upon voluntary or involuntary liquidation, dissolution or winding up of the Company and (b) shall be of equal rank

with Parity Stock as to the right to receive dividends and the right to receive payments out of the assets of the Company upon

voluntary or involuntary liquidation, dissolution or winding up of the Company. Section 2. Standard Definitions. As used

herein with respect to the Series D Preferred Stock:

(a) "AQPlicable Dividend Rate" means 10% per annum.

(b) "Business Combination" means a merger, consolidation, statutory share exchange or similar transaction that requires

the approval of the Company's stockholders.

(c) "Business Day" means any day except Saturday, Sunday and any day on which banking institutions in the State of

New York generally are authorized or required by law or other governmental actions to close.

(d) "Bylaws" means the bylaws of the Company, as they may be amended from time to time.

(e) "Certificate of Designations" means the Certificate of Designations or comparable instrument relating to the Series D

Preferred Stock, of which these Standard Provisions form a part, as it may be amended from time to time.

(f) "Charter" means the Company's Restated Certificate ofIncorporation, as amended.

(g) "Dividend Period" has the meaning set forth in Section 3(a).

(h) "Dividend Record Date" has the meaning set forth in Section 3(a).

(i) "Original Issue Date" means the date on which shares of the Series D Preferred Stock are first issued.

(j) "Preferred Director" has the meaning set forth in Section 7(b).

(k) "Preferred Stock" means any and all series of serial preferred stock of the Company, including the Series D Preferred

Stock.

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(1) "Share Dilution Amount" has the meaning set forth in Section 3(b).

(m) "Standard Provisions" mean these Standard Provisions that form a part of the Certificate of Designations relating to

the Series D Preferred Stock.

(n) "Trust" means the AIG Credit Facility Trust.

(0) "Voting Parity Stock" means, with regard to any matter as to which the holders of the Series D Preferred Stock are

entitled to vote as specified in Sections 7(a) and 7(b) of these Standard Provisions that form a part of the Certificate of

Designations. any and all series of Parity Stock upon which like voting rights have been conferred and are exercisable with

respect to such matter.

Section 3. Dividends.

(a) Rate. Holders of the Series D Preferred Stock shal1 be entitled to receive, on each share of the Series D Preferred Stock

if, as and when declared by the Board of Directors or any duly authorized committee of the Board of Directors, but only out

of assets legal1y available therefor, cumulative cash dividends with respect to each Dividend Period (as defined below) at a

rate per annum equal to the Applicable Dividend Rate on (i) the Liquidation Amount per share of the Series D Preferred

Stock and (ii) the amount of accrued and unpaid dividends for any prior Dividend Period on such share of the Series D

Preferred Stock, if any. Such dividends shal1 begin to accrue and be cumulative from the Original Issue Date, shall compound

on each subsequent Dividend Payment Date (Le., no dividends shall accrue on other dividends unless and until the first

Dividend Payment Date for such other dividends has passed without such other dividends having been paid on such date) and

shall be payable quarterly in arrears on each Dividend Payment Date, commencing with the first such Dividend Payment

Date to occur at least 20 calendar days after the Original Issue Date. In the event that any Dividend Payment Date would

otherwise fal1 on a day that is not a Business Day, the dividend payment due on that date will be postponed to the next day

that is a Business Day and no additional dividends will accrue as a result of that postponement. The period from and

including any Dividend Payment Date to, but excluding, the next Dividend Payment Date is a "Dividend Period", provided

that the initial Dividend Period shall be the period from and including the Original Issue Date to, but excluding, the next

Dividend Payment Date.

Dividends that are payable on Series D Preferred Stock in respect of any Dividend Period shall be computed on the basis

of a 360-day year consisting of twelve 30-day months. The amount of dividends payable on Series D Preferred Stock on any

date prior to the end of a Dividend Period, and for the initial Dividend Period. shall be computed on the basis of a .360-day

year consisting of twelve 30-day months, and actual days elapsed over a 30-day month. .

Dividends that are payable on Series D Preferred Stock on an)' Dividend Payment Date will be payable to holders of

record of the Series D Preferred Stock as they appear on the stock register of the Company on the applicable record date,

which shall be the 15th calendar day immediately preceding such Dividend Payment Date or such other record date fixed by

the Board of Directors or any duly authorized committee of the Board of Directors that is not more than 60 nor less than 10

days prior to such Dividend Payment Date (each, a "Dividend Record

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Date"). Any such day that is a Dividend Record Date shall be a Dividend Record Date whether or not such day is a Business

Day.

Holders of the Series D Preferred Stock shall not be entitled to any dividends, whether payable in cash, securities or other

property, other than dividends (if any) declared and payable on the Series D Preferred Stock as specified in this Section 3

(subject to the other provisions of the Certificate of Designations).

(b) Priority of Dividends. So long as any share of the Series D Preferred Stock remains outstanding, no dividend or

distribution shaH be declared or paid on the Common Stock or any other shares ofJunior Stock (other than dividends payable

solely in shares of Common Stock) or Parity Stock, subject to the immediately following paragraph in the case of Parity

Stock, and no Common Stock, Junior Stock or Parity Stock shaH be, directly or indirectly, purchased, redeemed or otherwise

acquired for consideration by the Corporation or any of its subsidiaries unless all accrued and unpaid dividends for aH past

Dividend Periods, including the latest completed Dividend Period (including, if applicable as provided in Section 3(a) above,

dividends on such amount), on all outstanding shares of the Series D Preferred Stock have been or are contemporaneously

declared and paid in full (or have been declared and a sum sufficient for the payment thereof has been set aside for the benefit

of the holders of shares of the Series D Preferred Stock on the applicable record date). The foregoing limitation shall not

apply to (i) a dividend payable on any Junior Stock in shares of any other Junior Stock, or to the acquisition of shares of any

Junior Stock in exchange for, or through application of the proceeds of the sale of, shares of any other Junior Stock;

(ii) redemptions, purchases or other acquisitions of shares of Common Stock or other Junior Stock in connection with the

administration of any employee benefit plan in the ordinary course of business (including purchases to offset the Share

Dilution Amount (as defined below) pursuant to a publicly announced repurchase plan) and consistent with past practice,

provided that any purchases to offset the Share Dilution Amount shall in no event exceed the Share Dilution Amount;

(iii) any dividends or distributions ofrights or Junior Stock in connection with a stockholders' rights plan or any redemption

or repurchase of rights pursuant to any stockholders' rights plan; (iv) the acquisition by the Company or any of its

subsidiaries of record ownership in Junior Stock or Parity Stock for the beneficial ownership of any other persons (other than

the Corporation or any of its subsidiaries), including as trustees or custodians; and (v) the exchange or conversion ofJunior

Stock for or into other Junior Stock or of Parity Stock for or into other Parity Stock (with the same or lesser aggregate

liquidation amount) or Junior Stock, in each case, solely to the extent required pursuant to binding contractual agreements

entered into prior to the Signing Date or any subsequent agreement for the accelerated exercise, settlement or exchange

thereof for Common Stock. "Share Dilution Amount" means the increase in the number of diluted shares outstanding

(determined in accordance with generaHy accepted accounting principles in the United States, and as measured from the date

of the Company's consolidated financial statements most recently filed with the Securities and Exchange Commission prior

to the Original Issue Date) resulting from the grant, vesting or exercise of equity-based compensation to employees and

equitably adjusted for any stock split, stock dividend, reverse stock split, reclassification or similar transaction.

When dividends are not paid (or declared and a sum sufficient for payment thereof set aside for the benefit of the holders

thereof on the applicable record date) on any Dividend Payment Date (or, in the case of Parity Stock having dividend

payment dates different from the

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Dividend Payment Dates, on a dividend payment date faIling within a Dividend Period related to such Dividend Payment

Date) in full upon the Series D Preferred Stock and any shares of Parity Stock, all dividends declared on the Series D

Preferred Stock and all such Parity Stock and payable on such Dividend Payment Date (or, in the case of Parity Stock having

dividend payment dates different from the Dividend Payment Dates, on a dividend payment date falling within the Dividend

Period related to such Dividend Payment Date) shall be declared pro rata so that the respective amounts of such dividends

declared shall bear the same ratio to each other as all accrued and unpaid dividends per share on the shares of the Series D

Preferred Stock (including, if applicable as provided in Section 3(a) above, dividends on such amount) and all Parity Stock

payable on such Dividend Payment Date (or, in the case of Parity Stock having dividend payment dates different from the

Dividend Payment Dates, on a dividend payment date falling within the Dividend Period related to such Dividend Payment

Date) (subject to their having been declared by the Board of Directors or a duly authorized committee of the Board of

Directors out of legally available funds and including, in the case of Parity Stock that bears cumulative dividends, all accrued

but unpaid dividends) bear to each other. If the Board of Directors or a duly authorized committee of the Board of Directors

determines not to pay any dividend or a full dividend on a Dividend Payment Date, the Company will provide written notice

to the holders of the Series D Preferred Stock prior to such Dividend Payment Date.

Subject to the foregoing, and not otherwise, such dividends (payable in cash, securities or other property) as may be

determined by the Board of Directors or any duly authorized committee of the Board of Directors may be declared and paid

on any securities, including Common Stock and other Junior Stock, from time to time out of any funds legally available for

such payment, and holders of the Series D Preferred Stock shall not be entitled to participate in any such dividends.

Section 4. Liquidation. Dissolution or Winding Up. In the event of any voluntary or involuntary liquidation, dissolution or

winding up of the affairs of the Company, then, before any distribution or payment shall be made to the holders ofJunior

Stock, the holders of the Series D Preferred Stock and any shares of Preferred Stock ranking on a parity therewith as to

liquidation shall be entitled to be paid in full the respective amounts of the liquidation preferences thereof, which in the case

of the Series D Preferred Stock shall be $10,000.00 per share, plus an amount equal to all accrued and unpaid dividends to

such distribution or payment date, whether or not earned or declared (including, if applicable, as provided in Section 3(a)

above, dividends on such accrued and unpaid dividends for all prior Dividend Periods). Ifsuch payment shall have been

made in full to the holders of the Series D Preferred Stock and any series of Preferred Stock ranking on a parity therewith as

to liquidation, the remaining assets and funds of the Company shall be distributed among the holders ofJunior Stock,

according to their respective rights and preferences and in each case according to their respective shares. If, upon any

liquidation, dissolution or winding up of the affairs of the Company, the amounts so payable are not paid in full to the holders

of all outstanding shares of the Series D Preferred Stock and any series of Preferred Stock ranking on a parity therewith as to

liquidation, the holders of the Series D Preferred Stock and any series of Preferred Stock ranking on a parity therewith as to

liquidation shall share ratably in any distribution of assets in proportion to the full amounts to which they would otherwise be

respectively entitled. Neither the consolidation or merger of the Company, nor the sale, lease or conveyance of all or a part of

its assets, shall be deemed a liquidation,

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dissolution or winding up of the affairs of the Company within the meaning of the foregoing provisions of this Section 4.

Section 5. Redemption.

(a) Optional Redemption. Except as provided in this Section 5(a), the Designated Preferred Stock shall not be redeemable.

At any time that (i) the Trust (or any successor entity established for the benefit of the United States Treasury) "beneficially

owns" less than 30% of the aggregate voting power of the Company's voting securities and (ii) no holder ofthe Series D

Preferred Stock controls the Company, the Company may redeem, in whole or in part, at any time and from time to time, out

of funds legally available therefor, the shares of the Series D Preferred Stock at the time outstanding, upon notice given as

provided in Section 5(c) below, the Series D Preferred Stock in whole or in part at a redemption price equal to 100% of its

Liquidation Amount, plus, except as set forth in the last sentence of the next paragraph, an amount equal to all accrued and

unpaid dividends to such redemption date (including, if applicable, as provided in Section 3(a) above, dividends on accrued

and unpaid dividends for all prior Dividend Periods). "Control" for purposes of this Section 5(a) means the power to direct

the management and policies of the Company, directly or indirectly, whether through the ownership of voting securities, by

contract, by the power to control the Board of Directors or otherwise. "Beneficially owns" for purposes of this Section 5(a) is

defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended to the Signing Date. For the avoidance of

doubt, while there is Board of Directors control (or the potential to gain Board of Directors control as a result of existing

contractual rights) by any holder of the Series D Preferred Stock, the Company may not redeem any of the Series D Preferred

Stock.

The redemption price for any shares of the Series D Preferred Stock shall be payable on the redemption date to the holder

of such shares against surrender of the certificate(s) evidencing such shares to the Company or its agent. Any declared but

unpaid dividends payable on a redemption date that occurs subsequent to the Dividend Record Date for a Dividend Period

shall not be paid to the holder entitled to receive the redemption price on the redemption date, but rather shall be paid to the

holder of record of the redeemed shares on such Dividend Record Date relating to the Dividend Payment Date as provided in

Section 3 above.

(b) No Sinking Fund. The Series D Preferred Stock will not be subject to any mandatory redemption, sinking fund or other

similar provisions. Holders of the Series D Preferred Stock will have no right to require redemption or repurchase of any

shares of the Series D Preferred Stock.

(c) Notice of Redemption. Notice of every redemption of shares of the Series D Preferred Stock shall be given by first

class mail, postage prepaid, addressed to the holders ofrecord of the shares to be redeemed at their respective last addresses

appearing on the books of the Company. Such mailing shall be at least 30 days and not more than 60 days before the date

fixed for redemption. Any notice mailed as provided in this Subsection shall be conclusively presumed to have been duly

given, whether or not the holder receives such notice, but failure duly to give such notice by mail, or any defect in such notice

or in the mailing thereof, to any holder of shares of the Series D Preferred Stock designated for redemption shall not affect

the validity of the proceedings for the redemption of any other shares of the Series D Preferred Stock. Notwithstanding the

foregoing, if shares of the Series D Preferred

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Stock are issued in book-entry form through The Depository Trust Corporation or any other similar facility, notice of

redemption may be given to the holders of the Series D Preferred Stock at such time and in any manner permitted by such

facility. Each notice of redemption given to a holder shall state: (1) the redemption date; (2) the number of shares of the

Series D Preferred Stock to be redeemed and, if less than all the shares held by such holder are to be redeemed, the number of

such shares to be redeemed from such holder; (3) the redemption price; and (4) the place or places where certificates for such

shares are to be surrendered for payment of the redemption price, but failure duly to give such notice to any holder of shares

of the Series D Preferred Stock designated for redemption or any defect in such notice shall not affect the validity of the

proceedings for the redemption of any other shares of the Series D Preferred Stock.

(d) Partial Redemption. In case of any redemption of part of the shares of the Series D Preferred Stock at the time

outstanding, the shares to be redeemed shall be selected either pro rata or in such other manner as the Board of Directors or a

duly authorized committee thereof may determine to be fair and equitable. Subject to the provisions hereof, the Board of

Directors or a duly authorized committee thereofshall have full power and authority to prescribe the terms and conditions

upon which shares of the Series D Preferred Stock shall be redeemed from time to time. If fewer than all the shares

represented by any certificate are redeemed, a new certificate shall be issued representing the unredeemed shares without

charge to the holder thereof.

(e) Effectiveness ofRedemption. If notice ofredemption has been duly given and if on or before the redemption date

specified in the notice all funds necessary for the redemption have been deposited by the Company, in trust for the pro rata

benefit of the holders of the shares called for redemption, with a bank or trust company doing business in the Borough of

Manhattan, The City of New York, and having a capital and surplus of at least $500 million and selected by the Board of

Directors, so as to be and continue to be available soleiy therefor, then, notwithstanding that any certificate for any share so

called for redemption has not been surrendered for cancellation, on and after the redemption date dividends shall cease to

accrue on all shares so called for redemption, all shares so called for redemption shall no longer be deemed outstanding and

all rights with respect to such shares shall forthwith on such redemption date cease and terminate, except only the right of the

holders thereof to receive the amount payable on such redemption from such bank or trust company, without interest. Any

funds unclaimed at the end of three years from the redemption date shall, to the extent permitted by law, be released to the

Company, after which time the holders of the shares so called for redemption shall look only to the Company for payment of

the redemption price ofsuch shares.

(f) Status of Redeemed Shares. Shares of the Series D Preferred Stock that are redeemed, repurchased or otherwise

acquired by the Company shall revert to authorized but unissued shares of the Series D Preferred Stock (provided that any

such cancelled shares of the Series D Preferred Stock may be reissued only as shares of any series of the Series D Preferred

Stock other than the Series D Preferred Stock).

Section 6. Conversion. Holders of the Series D Preferred Stock shares shall have no right to exchange or convert such

shares into any other securities.

Section 7. Voting Rights.

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(a) General. The holders of the Series D Preferred Stock shall not have any voting rights except as set forth below or as

otherwise from time to time required by law.

(b) Series D Preferred Stock Directors. Whenever, at any time or times, dividends payable on the shares of the Series D

Preferred Stock have not been paid for an aggregate of four quarterly Dividend Periods or more, whether or not consecutive,

the authorized number of directors of the Company shall automatically be increased to accommodate the number of the

Preferred Directors specified below and the holders of the Series D Preferred Stock shall have the right, with holders of

shares of anyone or more other classes or series of Voting Parity Stock outstanding at the time, voting together as a class, to

elect the greater of two directors and a number of directors (rounded upward) equal to 20% of the total number of directors of

the Company after giving effect to such election (hereinafter the "Preferred Directors" and each a "Preferred Director") to fill

such newly created directorships at the Company's next annual meeting of stockholders (or at a special meeting called for

that purpose prior to such next annual meeting) and at each subsequent annual meeting of stockholders until all accrued and

unpaid dividends for all past Dividend Periods, including the latest completed Dividend Period (including, if applicable as

provided in Section 3(a) above, dividends on such amount), on all outstanding shares of the Series D Preferred Stock have

. been declared and paid in full at which time such right shall terminate with respect to the Series D Preferred Stock, except as

herein or by law expressly provided, subject to revesting in the event of each and every subsequent payment failure of the

character above mentioned; provided that it shall be a qualification for election for any Preferred Director that the election of

such Preferred Director shall not cause the Company to violate any corporate governance requirements of any securities

exchange or other trading facility on which securities of the Company may then be listed or traded that listed or traded

companies must have a majority of independent directors. Upon any termination of the right of the holders of shares of the

Series D Preferred Stock and Voting Parity Stock as a class to vote for directors as provided above, the Preferred Directors

shall cease to be qualified as directors, the term of office of all Preferred Directors then in office shall terminate immediately

and the authorized number of directors shall be reduced by the number of the Preferred Directors elected pursuant hereto.

Any Preferred Director may be removed at any time, with or without cause, and any vacancy created thereby may be filled,

only by the affirmative vote of the holders a majority of the shares of the Series D Preferred Stock at the time outstanding

voting separately as a class together with the holders of shares of Voting Parity Stock, to the extent the voting rights of such

holders described above are then exercisable. If the office of any Preferred Director becomes vacant for any reason other than

removal from office as aforesaid, the remaining Preferred Director may choose a successor who shall hold office for the

unexpired term in respect of which such vacancy occurred.

(c) Class Voting Rights as to Particular Matters. So long as any shares of the Series D Preferred Stock are outstanding, in

addition to any other vote or consent of stockholders required by law or by the Charter, the vote or consent of the holders of

at least 66 2/3% of the shares of the Series D Preferred Stock at the time outstanding, voting as a separate class, given in

person or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose, shall be necessary

for effecting or validating:

(i) Authorization of Senior or Pari Passu Stock. Any amendment or alteration of the Certificate of Designations for the

Series D Preferred Stock or the Charter to

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authorize or create or increase the authorized amount of, or any issuance of, any shares of, or any securities convertible

into or exchangeable or exercisable for shares of, any class or series of capital stock of the Company ranking senior to or

pari passu with Series D Preferred Stock with respect to either or both the payment of dividends and/or the distribution of

assets on any liquidation, dissolution or winding up of the Company; provided that no such vote or consent of the holders

of the Series D Preferred Stock shall be required for the issuance of the Convertible Preferred Stock;

(ii) Amendment of the Series D Preferred Stock. Any amendment, alteration or repeal of any provision of the

Certificate of Designations for the Series D Preferred Stock or the Charter (including, unless no vote on such merger or

consolidation is required by Section 7(c)(iii) below, any amendment, alteration or repeal by means of a merger,

consolidation or otherwise) so as to adversely affect the rights, preferences, privileges or voting powers of the Series D

Preferred Stock; or

(iii) Share Exchanges, Reclassifications. Mergers and Consolidations. Any consummation of a binding share exchange

or reclassification involving the Series D Preferred Stock, or of a merger or consolidation of the Company with or into

another corporation or other entity, unless in each case (x) the shares of the Series D Preferred Stock remain outstanding

and are not amended in any respect or, in the case of any such merger or consolidation with respect to which the Company

is not the surviving or resulting entity, are converted into or exchanged for preference securities of the surviving or

resulting entity or its ultimate parent, and (y) such shares remaining outstanding or such preference securities, as the case

may be, have such rights, preferences, privileges and voting powers, and limitations and restrictions thereof, taken as a

whole, as are not material1y less favorable to the holders thereof than the rights, preferences, privileges and voting powers,

and limitations and restrictions thereof, of the Series D Preferred Stock immediately prior to such consummation, taken as

a whole;

provided, however, that for al1 purposes of this Section 7(c), any increase in the amount of the authorized Preferred Stock,

including any increase in the authorized amount of the Series D Preferred Stock necessary to satisfy preemptive or similar

rights granted by the Company to other persons prior to the Signing Date, or the creation and issuance, or an increase in the

authorized or issued amount, whether pursuant to preemptive or similar rights or otherwise, of any other series of the

Preferred Stock, or any securities convertible into or exchangeable or exercisable for any other series of the Preferred Stock,

ranking junior to the Series D Preferred Stock with respect to the payment of dividends (whether such dividends are

cumulative or non-cumulative) and the distribution of assets upon liquidation, dissolution or winding up of the Company will

not be deemed to adversely affect the rights, preferences, privileges or voting powers, and shall not require the affirmative

vote or consent of, the holders of outstanding shares of the Series D Preferred Stock.

(d) Changes after Provision for Redemption. No vote or consent of the holders of the Series D Preferred Stock shall be

required pursuant to Section 7(c) above if, at or prior to the time when any such vote or consent would otherwise be required

pursuant to such Section, all outstanding shares of the Series D Preferred Stock shall have been redeemed, or shall have been

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called for redemption upon proper notice and sufficient funds shall have been deposited in trust for such redemption, in each

case pursuant to Section 5 above.

(e) Procedures for Voting and Consents. The rules and procedures for calling and conducting any meeting of the holders

of the Series D Preferred Stock (including, without limitation, the fixing of a record date in connection therewith), the

solicitation and use of proxies at such a meeting, the obtaining of written consents and any other aspect or matter with regard

to such a meeting or such consents shall be governed by any rules of the Board of Directors or any duly authorized committee

of the Board of Directors, in its discretion, may adopt from time to time, which rules and procedures shall conform to the

requirements of the Charter, the Bylaws, and applicable law and the rules of any national securities exchange or other trading

facility on which Series D Preferred Stock is listed or traded at the time.

Section 8. Record Holders. To the fullest extent permitted by applicable law, the Company and the transfer agent for

Series D Preferred Stock may deem and treat the record holder of any share of the Series D Preferred Stock as the true and

lawful owner thereof for all purposes, and neither the Company nor such transfer agent shall be affected by any notice to the

contrary.

Section 9. Notices. All notices or communications in respect of the Series D Preferred Stock shall be sufficiently given if

given in writing and delivered in person or by first class mail, postage prepaid, or if given in such other manner as may be

permitted in this Certificate of Designations, in the Charter or Bylaws or by applicable law. Notwithstanding the foregoing, if

shares of the Series D Preferred Stock are issued in book-entry form through The Depository Trust Company or any similar

facility, such notices may be given to the holders of the Series D Preferred Stock in any manner permitted by such facility.

Section 10. No Preemptive Rights. No holder of the Series D Preferred Stock shall be entitled as a matter of right to

subscribe for or purchase, or have any preemptive right with respect to, any part of any new or additional issue of stock of

any class whatsoever, or ofsecurities convertible into any stock of any class whatsoever, whether now or hereafter authorized

and whether issued for cash or other consideration or by way of dividend.

Section II. Replacement Certificates. The Company shall replace any mutilated certificate at the holder's expense upon

surrender of that certificate to the Company. The Company shall replace certificates that become destroyed, stolen or lost at

the holder's expense upon delivery to the Company of reasonably satisfactory evidence that the certificate has been

destroyed, stolen or lost, together with any indemnity that may be reasonably required by the Company.

Section 12. Form.

(a) The Series D Preferred Stock shall be initially issued in the form of one or more certificates in definitive, fully

registered form with, until such time as otherwise determined by the Company, the restricted shares legend (the "Restricted

Shares Legend"), as set forth on the form of the Series D Preferred Stock attached hereto as Exhibit A (each, a "Series D

Preferred Share Certificate"), which is hereby incorporated in and expressly made a part of this Certificate

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of Designations. The Series D Preferred Share Certificate may have notations, legends or endorsements required by law,

stock exchange rules, agreements to which the Company is subject, if any, or usage (provided that any such notation, legend

or endorsement is in a form acceptable to the Company).

(b) An Officer shall sign the Series D Preferred Share Certificate for the Company, in accordance with the Company's

Bylaws and applicable law, by manual or facsimile signature. "Officer" means the Chairman, any Vice President, the

Treasurer or the Secretary of the Company.

(c) If an Officer whose signature is on a Series D Preferred Share Certificate no longer holds that office at the time the of

the issuance of such Series D Preferred Share Certificate, such Series D Preferred Share Certificate shall be valid

nevertheless.

(d) A Series D Preferred Share Certificate shall not be valid or obligatory until an authorized signatory of the Transfer

Agent manually countersigns the Series D Preferred Share Certificate. The signature shall be conclusive evidence that such

Series D Preferred Share Certificate has been authenticated under this Certificate of Designations. Each Series D Preferred

Share Certificate shall be dated the date of its authentication.

Other than upon original issuance, all transfers and exchanges of the Designated Preferred Stock shall be made by direct

registration on the books and records of the Company.

Section 13. Transfer Agent And Registrar. The duly appointed Transfer Agent and Registrar for the Series D Preferred

Stock shall be Wells Fargo Bank, N.A. The Company may, in its sole discretion, remove the Transfer Agent in accordance

with the agreement between the Company and the Transfer Agent; provided that the Company shall appoint a successor

transfer agent who shall accept such appointment prior to the effectiveness of such removal.

Section 14. Other Rights. The shares of the Series D Preferred Stock shall not have any rights, preferences, privileges or

voting powers or relative, participating, optional or other special rights, or qualifications, limitations or restrictions thereof,

other than as set forth herein or in the Charter or as provided by applicable law.

A-IO

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EXHIBIT A

FORM OF SERIES D FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK

($1 0,000 LIQUIDATION PREFERENCE)

NUMBER

1

SHARES

4,000,000

CUSIP [ --.I

AMERICAN INTERNATIONAL GROUP, INC.

INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE

TffiS CERTIFICATE IS TRANSFERABLE

IN THE CITY OF NEW YORK, NEW YORK

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE

SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY

STATE AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A

REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE

STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR

SUCH LAWS. EACH PURCHASER OF THE SECURITIES REPRESENTED BY THIS INSTRUMENT IS NOTIFIED

THAT THE SELLER MAYBE RELYING ON THE EXEMPTION FROM SECTION 5 OF THE SECURITIES ACT

PROVIDED BY RULE 144A THEREUNDER. ANY TRANSFEREE OF THE SECURITIES REPRESENTED BY THIS

INSTRUMENT BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL

BUYER" (AS DEFINED IN RULE I44A UNDER THE SECURITIES ACT), (2) AGREES THAT IT WILL NOT OFFER,

SELL OR OTHERWISE TRANSFER THE SECURITIES REPRESENTED BY THIS INSTRUMENT EXCEPT

(A) PURSUANT TO A REGISTRATION STATEMENT WHICH IS THEN EFFECTIVE UNDER THE SECURITIES

ACT, (B) FOR SO LONG AS THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE ELIGffiLE FOR

RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED

INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR

ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS

GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO THE ISSUER OR

(D) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF

THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THE SECURITIES

REPRESENTED BY THIS INSTRUMENT ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF

THIS LEGEND.

This is to certify that the UNITED STATES DEPARTMENT OF THE TREASURY is the owner of FOUR MILLION

(4,000,000) fully paid and non-assessable shares of Series D Fixed Rate Cumulative Perpetual Preferred Stock, $5.00 par

value, liquidation preference

A-I

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EX-3.1 Page 15 of 17 .

$10,000 per share (the "Stock"), of the American International Group, Inc. (the "Company"), transferable on the books of the

Company by the holder hereof in person or by duly authorized attorney upon surrender of this certificate properly endorsed.

This certificate is not valid or obligatory for any purpose unless countersigned and registered by the Transfer Agent and

Registrar.

Witness the facsimile seal of the Company and the facsimile signatures of its duly authorized officers.

Dated: November_. 2008

Name:

Title:

Name:

Title:

Countersigned and Registered

as Transfer Agent and Registrar

By: -;--:---;-~:::-:---------­ Authorized Signature

A-2

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AMERICAN INTERNATIONAL GROUP, INC.

AMERICAN INTERNATIONAL GROUP, INC. (the "Company") will furnish, without charge to each stockholder who

so requests, a copy of the certificate of designations establishing the powers, preferences and relative, participating, optional

or other special rights of each class of stock of the Company or series thereof and the qualifications, limitations or restrictions

of such preferences and/or rights applicable to each class of stock of the Company or series thereof. Such information may be

obtained by a request in writing to the Secretary of the Company at its principal place of business.

This certificate and the share or shares represented hereby are issued and shall be held subject to all of the provisions of

the Company's Restated Certificate of Incorporation, as amended, and the Certificate of Designations of the Series D Fixed

Rate Cumulative Perpetual Preferred Stock (Liquidation Preference $10,000 per share) (copies of which are on file with the

Transfer Agent), to all of which the holder, by acceptance hereof, assents.

The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they

were written out in full to applicable laws or regulations:

TEN COM -

TENENT -

JTTEN

as tenants in common

as tenants by the entireties

as joint tenants with right of survivorship and not

as tenants in common

UNIF GIFT MIN ACT- Custodian

(Minor) (Cust)

under Uniform Gifts to Minors Act

(State)

Additional abbreviations may also be used though not in the above list.

For value received, hereby sell(s), assign(s) and transfer(s) unto

PLEASE INSERT SOCIAL SECURITY OR OTHER

IDENTIFYING NUMBER OF ASSIGNEE

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE

------------------------------------------shares

of the capital stock represented by the within certificate, and do(es) hereby irrevocably constitute and

appoint , Attorney to transfer the said stock on the books of the within named Company with full

power of substitution in the premises.

A-3

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Dated _

SIGNATURE GUARANTEED

NOTICE: The signature(s) should be

guaranteed by an eligible guarantor

institution (banks, stockbrokers, savings

and loan associations, and credit unions

with membership in an approved signature

guarantee medallion program), pursuant to

Rule 17Ad-IS under the Securities

Exchange Act of 1934.

rag~ 1/ Ul 1/

Signature

NOTICE: The signature to this assignment must correspond

with the name as written upon the face of this

certificate in every particular, without alteration

or enlargement or any change whatever.

A-4

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bX-lU.l

EX-lO.l 3 y72888exvlOw1.htm EX-lO.l: SECURITIES PURCHASE AGREEMENT

SECURITIES PURCHASE AGREEMENT

dated as of

November 25, 2008

between

American International Group, Inc.

and

United States Department of the Treasury

Page 1 of 55

Exhibit 10.1

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TABLE OF CONTENTS

Page 2 of 55

PAGE

1.1

1.2

1.3

2.1

2.2

3.1

3.2

3.3

3.4

3.5

4.1

4.2

4.3

4.4

4.5

4.6

4.7

4.8

4.9

4.10

4.11

4.12

4.13

4.14

ARTICLE 1

PuRCHASE; CLOSING

Purchase

Closing

Interpretation

ARTICLE 2

REPRESENTATIONS AND WARRANTIES

Disclosure

Representations and Warranties ofthe Company

ARTICLE 3

COVENANTS

Consummation ofPurchase and Charter Amendment

Expenses

Sufficiency ofAuthorized Common Stock; Exchange Listing

Certain Notifications Until Closing

Information and Confidentiality

ARTICLE 4

ADDITIONAL AGREEMENTS

Purchase ofRestricted Securities

Legends

Certain Transactions

Transfer ofPurchased Securities. the Warrant and Warrant Shares

Registration Rights

Voting ofWarrant Shares

Depositary Shares

Restriction on Dividends and Repurchases

Repurchase ofInvestor Securities

Executive Compensation

Restrictions on Lobbying

Restrictions on Expenses

Risk Management Committee

Dividend Rate Adjustment

1

1

4

4

5

13

15

15

15

15

16

16

18

18

18

30

30

30

31

33

35

35

36

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ARTICLES

MISCELLANEOUS

5.1 Termination

5.2 SUT1Iival ofRepresentations and Warranties

5.3 Amendment

5.4 Waiver ofConditions

5.5 Governing Law: Submission to Jurisdiction, Etc.

5.6 Notices

5.7 Definitions

5.8 Assignment

5.9 Severability

5.10 Entire Agreement

5.11 No Third Party Beneficiaries

SCHEDULE A: ADDITIONAL TERMS AND CONDITIONS

SCHEDULE B: CAPITALIZATION

SCHEDULE C: LITIGATION

SCHEDULE D: COMPLIANCE WITH LAWS

SCHEDULE E: REGULATORY AGREEMENTS

LIST OF ANNEXES

Page 3 of 55

PAGE

36

36

37

37

37

37

38

39

39

39

39

ANNEXA:

ANNEX B-1:

ANNEX B-2:

ANNEXC:

ANNEXD:

FORM OF CERTIFICATE OF DESIGNAnONS FOR PREFERRED STOCK

FORM OF WAIVER FOR THE SENIOR EXECUTIVE OFFICERS AND THE SENIOR PARTNERS

FORM OF WAIVER FOR THE COMPANY

FORM OF OPINION

FORM OF WARRANT

ii

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~X-lU.l

INDEX OF DEFINED TERMS

Term

Affiliate

Agreement

Appraisal Procedure

Bankruptcy Exceptions

Benefit Plans

Board of Directors

Business Combination

business day

Capitalization Date

Certificate of Designations

Charter

Closing

Closing Date

Code

Common Stock

Company

Company Financial Statements

Company Material Adverse Effect

Company Reports

Company Subsidiary; Company Subsidiaries

Control

control; controlled by; under common control with

Controlled Group

Credit Agreement

EESA

Equity Interests

ERISA

Exchange Act

Fair Market Value

FRBNY

Fund

GAAP

Governmental Entities

Holder

Holders' Counsel

Indemnitee

Information

Investor

Junior Stock

knowledge of the Company; Company's knowledge

III

Page 40155

Location of

Definition

5.7(b)

Recitals

4.9(c)(i)

2.2(d)

1.2(d)(iv)

2.2(f)

5.8

1.3

2.2(b)

1.2(d)(iii)

2.2(a)

1.2(a)

1.2(a)

2.2(n)

2.1

Recitals

2.2(h)

2.1 (a)

2.2(i)(i)

2.2(i)(i)

4.9(c)(iii)

5.7(b)

2.2(n)

1.2(b)

1.2(d)(iv)

5.7(b)

2.2(n)

2.1 (b)

4.9(c)(ii)

1.2(b)

5.7(b)

2.1 (a)

1.2(c)

4.5(k)(i)

4.5(k)(ii)

4.5(g)(i)

3.5(b)

Recitals

4.8(c)

5.7(c)

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Term

Last Fiscal Year

officers

Parity Stock

Pending Underwritten Offering

Permitted Repurchases

Piggyback Registration

Plan

Preferred Stock

Previously Disclosed

Proprietary Rights

Purchase

Purchase Price

Purchased Securities

register; registered; registration

Registrable Securities

Registration Expenses

Regulatory Agreement

Rule 144; Rule 144A; Rule 159A; Rule 405; Rule 415

SEC

Securities Act

Selling Expenses

Senior Executive Officers

Senior Partners

Series C Preferred Stock

Share Dilution Amount

Shelf Registration Statement

Signing Date

Special Registration

Stockholder Proposal

subsidiary

Tax; Taxes

Transfer

Warrant

Warrant Shares

IV

Page 5 of 55

Location of

Definition

2.1 (b)

5.7(c)

4.8(c)

4.5(1)

4.8(a)(ii)

4.5(a)(iv)

2.2(n)

Recitals

2.1 (b)

2.2(u)

Recitals

l.l

Recitals

4.5(k)(iii)

4.5(k)(iv)

4.5(k)(v)

2.2(s)

4.5(k)(vi)

2.I(b)

2.2(a)

4.5(k)(vii)

4.10

4.10

2.2(b)

4.8(a)(ii)

4.5(a)(ii)

2.1(a)

4.5(i)

3. I(b)

5.7(a)

2.2(0)

4.4

Recitals

2.2(d)

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SECURITIES PURCHASE AGREEMENT

Page 6 of 55

Recitals:

WHEREAS, American International Group, Inc. (the "Company") intends to issue in a private placement 4,000,000

shares of the Series D Fixed Rate Cumulative Perpetual Preferred Stock (the "Preferred Stock") and a warrant (the

"Warrant", and together with the Preferred Stock, the "Purchased Securities") to purchase 53,798,766 shares of the

Company's common stock and the United States Department of the Treasury (the "Investor") intends to purchase (the

"Purchase") from the Company the Purchased Securities; and

WHEREAS, the Purchase will be governed by this Securities Purchase Agreement (including the Schedules and Annexes

hereto) (the "Agreement").

NOW, THEREFORE, in consideration of the premises, and of the representations, warranties, covenants and agreements

set forth herein, the parties agree as follows:

Article 1

Purchase; Closing

1.1 Purchase. On the terms and subject to the conditions set forth in this Agreement, the Company agrees to sell to the

Investor, and the Investor agrees to purchase from the Company, at the Closing (as hereinafter defined), the Purchased

Securities for $40,000,000,000 (the "Purchase Price").

1.2 Closing.

(a) On the terms and subject to the conditions set forth in this Agreement, the closing of the Purchase (the "Closing") will

take place at the location specified in Schedule A, at the time and on the date set forth in Schedule A, or as soon as

practicable thereafter, or at such other place, time and date as shall be agreed between the Company and the Investor. The

time and date on which the Closing occurs is referred to in this Agreement as the "Closing Date".

(b) Subject to the fulfillment or waiver of the conditions to the Closing in this Section 1.2, at the Closing (i) the Company

will deliver the Preferred Stock and the Warrant, in each case as evidenced by one or more certificates dated the Closing Date

and bearing appropriate legends as hereinafter provided for, (ii) upon verification of receipt of the Preferred Stock and

Warrant at the Investor's custodian, the Investor shall pay the Purchase Price by instructing the Federal Reserve Bank of New

York (the "FRBNY"), acting as fiscal agent ofthe Investor, to debit the Investor's General Account for the Purchase Price,

and the Investor is hereby directed by the Company to pay the Purchase Price directly to the FRBNY as a credit to the

account on the books of the FRBNY evidencing a prepayment in the amount of the Purchase Price of the Company's

indebtedness to the FRBNY under the Credit Agreement dated as of September 22,

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2008 between the Company and the FRBNY. as amended from time to time (the "Credit Agreement").

(c) The respective obligations of each of the Investor and the Company to consummate the Purchase are subject to the

fulfillment (or waiver by the Investor and the Company. as applicable) prior to the Closing of the conditions that (i) any

approvals or authorizations of all United States and other governmental. regulatory or judicial authorities (collectively,

"Governmental Entities") required for the consummation of the Purchase shall have been obtained or made in form and

substance reasonably satisfactory to each party and shall be in full force and effect and all waiting periods required by United

States and other applicable law, if any, shall have expired and (ii) no provision of any applicable United States or other law

and no judgment, injunction. order or decree of any Governmental Entity shall prohibit the purchase and sale of the

Purchased Securities as contemplated by this Agreement.

(d) The obligation of the Investor to consummate the Purchase is also subject to the fulfillment (or waiver by the Investor)

at or prior to the Closing of each of the following conditions:

(i) (A) the representations and warranties of the Company set forth in (x) Section 2.2(g) of this Agreement shall be true

and correct in all respects as though made on and as of the Closing Date. (y) Sections 2.2(a) through (f) shall be true and

correct in all material respects as though made on and as of the Closing Date (other than representations and warranties

that by their terms speak as of another date, which representations and warranties shall be true and correct in all material

respects as ofsuch other date) and (z) Sections 2.2(h) through (v) (disregarding all qualifications or limitations set forth in

such representations and warranties as to "materiality", "Company Material Adverse Effect" and words of similar

import) shall be true and correct as though made on and as of the Closing Date (other than representations and warranties

that by their terms speak as of another date. which representations and warranties shall be true and correct as of such other

date), except to the extent that the failure of such representations and warranties referred to in this Section 1.2(d)(i)(A)(z)

to be so true and correct, individually or in the aggregate, does not have and would not reasonably be expected to have a

Company Material Adverse Effect and (B) the Company shall have performed in all material respects all obligations

required to be performed by it under this Agreement at or prior to the Closing;

(ii) the Investor shall have received a certificate signed on behalf of the Company by a senior executive officer

certifying to the effect that the conditions set forth in Section 1.2(d)(i) have been satisfied;

(iii) the Company shall have duly adopted and filed with the Secretary of State of its jurisdiction of organization or

other applicable Governmental Entity the certificate of designations for the Preferred Stock in substantially the form

attached hereto as Annex A (the "Certificate of Designations") and such filing shall have been accepted;

2

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(iv) (A) the Company shall have taken all necessary action to effect such changes to its compensation. bonus. incentive

and other benefit plans, arrangements and agreements (including golden parachute. severance and employment

agreements) (collectively, "Benefit Plans") with respect to the Senior Executive Officers (and to the extent necessary for

such changes to be legally enforceable. each of the Senior Executive Officers shall have duly consented in writing to such

changes). as may be necessary, during the period that the Investor owns any debt or equity securities of the Company

acquired pursuant to this Agreement or the Warrant, in order to comply with Section III(b) of the Emergency Economic

Stabilization Act of 2008 ("EESA"), including the provisions for Systemically Significant Failing Institutions, as

implemented by guidance or regulation thereunder. including Notice 2008-PSSFI. that has been issued and is in effect as of

the Closing Date, including provisions prohibiting severance payments to the Senior Executive Officers. (B) the Company

shall have taken all necessary action to effect such changes to its Benefit Plans with respect to the U.S.-based Senior

Partners (and to the extent necessary for such changes to be legally enforceable, each of the U.S.-based Senior Partners

shall have duly consented in writing to such changes), as may be necessary, during the period that the Investor owns any

debt or equity securities of the Company acquired pursuant to this Agreement or the Warrant, in order to comply with the

requirements in Section 4.10 of this Agreement. (C) the Company shall have used its best efforts to take all necessary

action to effect such changes to its Benefit Plans with respect to the other Senior Partners (and to the extent necessary for

such changes to be legally enforceable, to have each of the other Senior Partners duly consent in writing to such changes).

as may be necessary, during the period that the Investor owns any debt or equity securities of the Company acquired

pursuant to this Agreement or the Warrant, in order to comply with the requirements in Section 4.10 of this Agreement and

(D) the Investor shall have received a certificate signed on behalf of the Company by a senior executive officer certifying

to the effect that the conditions set forth in Section 1.2(d)(iv)(A) and (B) have been satisfied;

(v) each of the Company's Senior Executive Officers and the U.S-based Senior Partners shall have delivered to the

Investor, and the Company shall have delivered to the Investor, a written waiver in the form attached hereto as Annex B-1

(for the Senior Executive Officers and Senior Partners) or Annex B-2 (for the Company) releasing the Investor and the

Company. and in the case of the Company's waiver, releasing the Investor, from any claims that such Senior Executive

Officers or Senior Partners may otherwise have against the Company or the Investor, and in the case of the Company, any

claims it may have against the Investor, in each case as a result of the issuance, on or prior to the Closing Date, of any such

guidance or regulations or as a result of the requirements in Section 4.10 of this Agreement which require the modification

of, and the agreement of the Company hereunder to modify, the terms of any Benefit Plans with respect to the Senior

Executive Officers and, as applicable, with respect to the Senior Partners to eliminate or modify any provisions of such

Benefit Plans that would not be in compliance with the requirements of Section III(b) of the EESA. including the

provisions for Systemically Significant Failing Institutions, as implemented

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by guidance or regulation thereunder, including Notice 2008-PSSFI, that has been is~ued and is in effect as of the Closing

Date, and the requirements in Section 4.10 of this Agreement;

(vi) the Company shall have delivered to the Investor a written opinion from counsel to the Company (which may be

internal counsel), addressed to the Investor and dated as of the Closing Date, in substantially the form attached hereto as

Annex C;

(vii) the Company shall have delivered certificates in proper form or, with the prior consent of the Investor, evidence of

shares in book-entry form, evidencing the Preferred Stock to the Investor or its designee(s); and

(viii) the Company shall have duly executed the Warrant in substantially the form attached hereto as Annex D and

delivered such executed Warrant to the Investor or its designee(s).

1.3 Interpretation. When a reference is made in this Agreement to "Recitals," "Articles," "Sections," "Annexes" or

"Schedules" such reference shall be to a Recital, Article or Section of, or Annex or Schedule to, this Agreement. The terms

defined in the singular have a comparable meaning when used in the plural, and vice versa. References to "herein", "hereof',

"hereunder" and the like refer to this Agreement as a whole and not to any particular section or provision, unless the context

requires otherwise. The table of contents and headings contained in this Agreement are for reference purposes only and are

not part of this Agreement. Whenever the words "include," "includes" or "including" are used· in this Agreement, they shall

be deemed followed by the words "without limitation." No rule of construction against the draftsperson shall be applied in

connection with the interpretation or enforcement of this Agreement, as this Agreement is the product of negotiation between

sophisticated parties advised by counsel. All references to "$" or "dollars" mean the lawful currency of the United States of

America. Except as expressly stated in this Agreement, all references to any statute, rule or regulation are to the statute, rule

or regulation as amended, modified, supplemented or replaced from time to time (and, in the case of statutes, include any

rules and regulations promulgated under the statute) and to any section of any statute, rule or regulation include any successor

to the section. References to a "business day" shall mean any day except Saturday, Sunday and any day on which banking

institutions in the State of New York generally are authorized or required by law or other governmental actions to close.

Article 2

Representations and Warranties

2.1 Disclosure.

(a) "Company Material Adverse Effect" means a material adverse effect on (i) the business, results of operation or

financial condition of the Company and its consolidated subsidiaries taken as a whole; provided. however, that Company

Material Adverse Effect shall

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not be deemed to include the effects of (A) changes after the date of this Agreement (the "Signing Date") in general

business, economic or market conditions (including changes generally in prevailing interest rates, credit availability and

liquidity, currency exchange rates and price levels or trading volumes in the United States or foreign securities or credit

markets), or any outbreak or escalation of hostilities, declared or undeclared acts of war or terrorism, in each case generally

affecting the industries in which the Company and its subsidiaries operate, (B) changes or proposed changes after the Signing

Date in generally accepted accounting principles in the United States ("GAAP") or regulatory accounting requirements, or

authoritative interpretations thereof, (C) changes or proposed changes after the Signing Date in securities, insurance and other

laws of general applicability or related policies or interpretations of Governmental Entities (in the case of each of these

clauses (A), (B) and (C), other than changes or occurrences to the extent that such changes or occurrences have or would

reasonably be expected to have a materially disproportionate adverse effect on the Company and its consolidated subsidiaries

taken as a whole relative to comparable U.S. insurance or financial services organizations), or (D) changes in the market

price or trading volume of the Company's common stock, par value $2.50 per share ("Common Stock"), or any other equity,

equity-related or debt securities of the Company or its consolidated subsidiaries (it being understood and agreed that the

exception set forth in this clause (D) does not apply to the underlying reason giving rise to or contributing to any such

change); or (ii) the ability of the Company to consummate the Purchase and the other transactions contemplated by this

Agreement and the Warrant and perform its obligations hereunder or thereunder on a timely basis.

(b) "Previously Disclosed" means information set forth or incorporated in the Company's Annual Report on Form lO-K

for the most recently completed fiscal year of the Company filed with the Securities and Exchange Commission (the "SEC")

prior to the Signing Date (the "Last Fiscal Year") or in its other reports and forms filed with or furnished to the SEC under

Sections 13(a), 14(a) or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act") on or after the last day of the

Last Fiscal Year and prior to the Signing Date.

2.2 Representations and Warranties ofthe Company. Except as Previously Disclosed, the Company represents and

warrants to the Investor that as of the Signing Date and as of the Closing Date (or such other date specified herein):

(a) Organization. Authority and Significant Subsidiaries. The Company has been duly incorporated and is validly existing

and in good standing under the laws of its jurisdiction of organization, with the necessary power and authority to own its

properties and conduct its business in all material respects as currently conducted; except as has not had, individually or in

the aggregate, and would not reasonably be expected to have a Company Material Adverse Effect, the Company has been

duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each other

jurisdiction in which it owns or leases properties or conducts any business so as to require such qualification; each subsidiary

of the Company that is a "significant subsidiary" within the meaning of Rule 1-02(w) of Regulation S-X under the

Securities Act of 1933 (the "Securities Act") has been duly organized and is validly existing in good standing under the laws

of its jurisdiction of organization. The Restated Certificate of Incorporation of the Company, as amended (the "Charter")

and bylaws

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of the Company, copies of which have been provided to the Investor prior to the Signing Date, are true, complete and correct

copies of such documents as in full force and effect as of the Signing Date.

(b) Capitalization. The authorized capital stock of the Company, and the outstanding capital stock of the Company

(including securities convertible into, or exercisable or exchangeable for, capital stock of the Company) as of the most recent

fiscal month-end preceding the Signing Date (the "Capitalization Date") is set forth on Schedule B. The outstanding shares

of capital stock of the Company have been duly authorized and are validly issued and outstanding, fully paid and

nonassessable, and subject to no preemptive rights (and were not issued in violation of any preemptive rights). As of the

Signing Date, the Company does not have outstanding any securities or other obligations providing the holder the right to

acquire Common Stock that is not reserved for issuance, and the Company has not made any other commitment to authorize,

issue or sell any Common Stock, except as specified on Schedule B and including the Series C Perpetual, Convertible,

Participating Preferred Stock, par value $5.00 per share (the "Series C Preferred Stock"). Since the Capitalization Date, the

Company has not issued any shares of Common Stock, other than (i) shares issued upon the exercise of stock options or

delivered under other equity-based awards or other convertible securities or warrants which were issued and outstanding on

the Capitalization Date and disclosed on Schedule Band (ii) shares disclosed on Schedule B.

(c) Preferred Stock. The Preferred Stock has been duly and validly authorized, and, when issued and delivered pursuant to

this Agreement, such Preferred Stock will be duly and validly issued and fully paid and non-assessable, will not be issued in

violation of any preemptive rights, and will rank pari passu with all other series or classes of the Company's preferred stock,

whether or not issued or outstanding, with respect to the payment of dividends and the distribution of assets in the event of

any dissolution, liquidation or winding up of the Company.

(d) The Warrant and Warrant Shares. The Warrant has been duly authorized and, when executed and delivered as

contemplated hereby, will constitute a valid and legally binding obligation of the Company enforceable against the Company

in accordance with its terms, except as the same may be limited by applicable bankruptcy, insolvency, reorganization,

moratorium or similar laws affecting the enforcement of creditors' rights generally and general equitable principles,

regardless of whether such enforceability is considered in a proceeding at law or in equity ("Bankruptcy Exceptions"). The

shares of Common Stock issuable upon exercise of the Warrant (the "Warrant Shares") have been duly authorized and

reserved for issuance upon exercise of the Warrant and when so issued in accordance with the terms of the Warrant will be

validly issued, fully paid and non-assessable.

(e) Authorization. Enforceability.

(i) The Company has the corporate power and authority to execute and deliver this Agreement and the Warrant and,

subject to the approval of its stockholders described in Section 3.1 (b), to carry out its obligations hereunder and thereunder

(which

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includes the issuance of the Preferred Stock, Warrant and Warrant Shares). The execution, delivery and performance by

the Company of this Agreement and the Warrant and the consummation of the transactions contemplated hereby and

thereby have been duly authorized by all necessary corporate action on the part of the Company and its stockholders, and

no further approval or authorization is required on the part of the Company or its stockholders, except as described in

Section 3.1 (b). This Agreement is a valid and binding obligation of the Company enforceable against the Company in

accordance with its terms, subject to the Bankruptcy Exceptions.

(ii) The execution, delivery and performance by the Company of this Agreement and the Warrant and the

consummation of the transactions contemplated hereby and thereby and compliance by the Company with the provisions

hereof and thereof, will not (A) violate, conflict with, or result in a breach of any provision of, or constitute a default (or an

event which, with notice or lapse of time or both, would constitute a default) under, or result in the termination of, or

accelerate the performance required by, or result in a right of termination or acceleration of, or result in the creation of, any

lien, security interest, charge or encumbrance upon any of the properties or assets of the Company or any Company

Subsidiary under any of the terms, conditions or provisions of (i) subject to the approval of the Company's stockholders as

described in Section 3.l(b), its organizational documents or (ii) any note. bond, mortgage, indenture, deed of trust, license,

lease, agreement or other instrument or obligation to which the Company or any Company Subsidiary is a party or by

which it or any Company Subsidiary may be bound, or to which the Company or any Company Subsidiary or any of the

properties or assets ofthe Company or any Company Subsidiary may be subject, or (B) subject to compliance with the

statutes and regulations referred to in the next paragraph, violate any statute, rule or regulation or any judgment, ruling,

order, writ, injunction or decree applicable to the Company or any Company Subsidiary or any oftheir respective

properties or assets except, in the case of clauses (A)(ii) and (B), for those occurrences that, individually or in the

aggregate, have not had and would not reasonably be expected to have a Company Material Adverse Effect.

(iii) Other than the filing of the Certificate of Designations with the Secretary of State of its jurisdiction of organization

or other applicable Governmental Entity, any current report on Form 8-K required to be filed with the SEC, such filings

and approvals as are required to be made or obtained under any state "blue sky" laws, the filing of any proxy statement

contemplated by Section 3.1(b) and such as have been made or obtained, no notice to, filing with, exemption or review by.

or authorization, consent or approval of, any Governmental Entity is required to be made or obtained by the Company in

connection with the consummation by the Company of the Purchase except for any such notices, filings. exemptions,

reviews, authorizations, consents and approvals the failure of which to make or obtain would not, individually or in the

aggregate, reasonably be expected to have a Company Material Adverse Effect.

(f) Anti-takeover Provisions and Rights Plan. The Board of Directors of the Company (the "Board of Directors") has

taken all necessary action to ensure that the transactions

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contemplated by this Agreement and the Warrant and the consummation of the transactions contemplated hereby and

thereby, including the exercise of the Warrant in accordance with its terms, will be exempt from any anti-takeover or similar

provisions of the Company's Charter and bylaws, and any other provisions of any applicable "moratorium", "control share",

"fair price", "interested stockholder" or other anti-takeover laws and regulations of any jurisdiction. The Company has taken

all actions necessary to render any stockholders' rights plan of the Company inapplicable to this Agreement and the Warrant

and the consummation of the transactions contemplated hereby and thereby, including the exercise of the Warrant by the

Investor in accordance with its terms.

(g) No Company Material Adverse Effect. Since the last day of the last completed fiscal period for which the Company

has filed a Quarterly Report on Form IO-Q or an Annual Report on Form IO-K with the SEC prior to the Signing Date, no

fact, circumstance, event, change, occurrence, condition or development has occurred that, individually or in the aggregate,

has had or would reasonably be expected to have a Company Material Adverse Effect.

(h) Company Financial Statements. The financial statements of the Company and its consolidated subsidiaries

(collectively, the "Company Financial Statements") included or incorporated by reference in the Company Reports filed

with the SEC since December 31, 2006, present fairly in all material respects the consolidated financial position of the

Company and its consolidated subsidiaries as of the dates indicated therein (or if amended prior to the Signing Date, as of the

date of such amendment) and the consolidated results of their operations for the periods specified therein; and except as

stated therein, such financial statements (A) were prepared in conformity with GAAP applied on a consistent basis (except as

may be noted therein), (B) have been prepared from, and are in accordance with, the books and records of the Company and

the Company Subsidiaries and (C) complied as to form, as of their respective dates of filing with the SEC, in all material

respects with the applicable accounting requirements and with the published rules and regulations of the SEC with respect

thereto.

(i) Reports.

(i) Since December 31, 2006, the Company and each subsidiary of the Company (each a "Company Subsidiary" and,

collectively, the "Company Subsidiaries") has timely filed (subject to any permitted extension) all reports, registrations,

documents, filings, statements and submissions, together with any amendments thereto, that it was required to file with any

Governmental Entity (the foregoing, collectively, the "Company Reports") and has paid all fees and assessments due and

payable in connection therewith, except, in each case, as would not, individually or in the aggregate, reasonably be

expected to have a Company Material Adverse Effect. As of their respective dates of filing, the Company Reports

complied in all material respects with all statutes and applicable rules and regulations of the applicable Governmental

Entities. In the case of each such Company Report filed with or furnished to the SEC, such Company Report (A) did not,

as of its date or if amended prior to the Signing Date, as of the date of such amendment, contain an untrue statement of a

material fact or omit to state a material fact necessary in order to make the statements made

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therein, in light of the circumstances under which they were made, not misleading, and (B) complied as to form in all

material reSpects with the applicable requirements of the Securities Act and the Exchange Act. With respect to all other

Company Reports, the Company Reports were complete and accurate in all material respects as of their respective dates.

No executive officer of the Company or any Company Subsidiary has failed in any respect to make the certifications

required of him or her under Section 302 or 906 of the Sarbanes-Oxley Act of 2002.

(ii) The records, systems, controls, data and information of the Company and the Company Subsidiaries are recorded,

stored, maintained and operated under means (including any electronic, mechanical or photographic process, whether

computerized or not) that are under the exclusive ownership and direct control of the Company or the Company

Subsidiaries or their accountants (including all means of access thereto and therefrom), except for any non-exclusive

ownership and non-direct control that would not reasonably be expected to have a material adverse effect on the system of

internal accounting controls described below in this Section 2.2(i)(ii). The Company (A) has implemented and maintains

disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act) to ensure that material information

relating to the Company, including the consolidated Company Subsidiaries, is made known to the chief executive officer

and the chief financial officer of the Company by others within those entities, and (B) has disclosed, based on its most

recent evaluation prior to the Signing Date, to the Company's outside auditors and the audit committee of the Board of

Directors (x) any significant deficiencies and material weaknesses in the design or operation of internal controls over

financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) that are reasonably likely to adversely affect the

Company's ability to record, process, summarize and report financial information and (y) any fraud, whether or not

material, that involves management or other employees who have a significant role in the Company's internal controls

over financial reporting.

G) No Undisclosed Liabilities. Neither the Company nor any of the Company Subsidiaries has any liabilities or

obligations of any nature (absolute, accrued, contingent or otherwise) which are not properly reflected or reserved against in

the Company Financial Statements to the extent required to be so reflected or reserved against in accordance with GAAP,

except for (A) liabilities that have arisen since the last fiscal year end in the ordinary and usual course of business and

consistent with past practice and (B) liabilities that, individually or in the aggregate, have not had and would not reasonably

be expected to have a Company Material Adverse Effect.

(k) Offering of Securities. Neither the Company nor any person acting on its behalf has taken any action (including any

offering of any securities of the Company under circumstances which would require the integration of such offering with the

offering of any of the Purchased Securities under the Securities Act, and the rules and regulations of the SEC promulgated

thereunder), which might subject the offering, issuance or sale of any of the Purchased Securities to Investor pursuant to this

Agreement to the registration requirements of the Securities Act.

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(I) Litigation and Other Proceedings. Except (i) as set forth on ScheduleC or (ii) as would not, individually or in the

aggregate, reasonably be expected to have a Company Material Adverse Effect, there is no (A) pending or, to the knowledge

of the Company, threatened, claim, action, suit, investigation or proceeding, against the Company or any Company

Subsidiary or to which any of their assets are subject nor is the Company or any Company Subsidiary subject to any order,

judgment or decree or (B) unresolved violation, criticism or exception by any Governmental Entity with respect to any report

or relating to any examinations or inspections of the Company or any Company Subsidiaries.

(m) Compliance with Laws. Except as would not, individually or in the aggregate, reasonably be expected to have a

Company Material Adverse Effect, the Company and the Company Subsidiaries have all permits, licenses, franchises,

authorizations, orders and approvals of, and have made all filings, applications and registrations with, Governmental Entities

that are required in order to permit them to own or lease their properties and assets and to carry on their business as presently

conducted and that are material to the business of the Company or such Company Subsidiary. Except as set forth on

Schedule D, the Company and the Company Subsidiaries have complied in all respects and are not in default or violation of,

and none of them is, to the knowledge of the Company, under investigation with respect to or, to the knowledge of the

Company, have been threatened to be charged with or given notice of any violation of, any applicable domestic (federal, state

or local) or foreign law, statute, ordinance, license, rule, regulation, policy or guideline, order, demand, writ, injunction,

decree or judgment of any Governmental Entity, other than such noncompliance, defaults or violations that would not,

individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect. Except for statutory or

regulatory restrictions of general application or as set forth on Schedule D, no Governmental Entity has placed any restriction

on the business or properties of the Company or any Company Subsidiary that would, individually or in the aggregate,

reasonably be expected to have a Company Material Adverse Effect.

(n) Employee Benefit Matters. Except as would not reasonably be expected to have, either individually or in the

aggregate, a Company Material Adverse Effect: (A) each "employee benefit plan" (within the meaning of Section 3(3) of

the Employee Retirement Income Security Act of 1974, as amended ("ERISA"» providing benefits to any current or former

employee, officer or director of the Company or any member of its "Controlled Group" (defined as any organization which

is a member of a controlled group of corporations within the meaning of Section 414 of the Internal Revenue Code of 1986,

as amended (the "Code"» that is sponsored, maintained or contributed to by the Company or any member of its Controlled

Group and for which the Company or any member of its Controlled Group would have any liability, whether actual or

contingent (each, a "Plan") has been maintained in compliance with its terms and with the requirements of all applicable

statutes, rules and regulations, including ERISA and the Code; (B) with respect to each Plan subject to Title IV of ERISA

(including, for purposes of this clause (B), any plan subject to Title IV of ERISA that the Company or any member of its

Controlled Group previously maintained or contributed to in the six years prior to the Signing Date), (1) no "reportable

event" (within the meaning of Section 4043(c) of ERISA), other than a reportable event for which the notice period referred

to in Section 4043(c) of ERISA has been waived, has occurred in the three years prior to the Signing Date or is reasonably

expected to occur, (2) no

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"accumulated funding deficiency" (within the meaning of Section 302 of ERISA or Section 412 of the Code), whether or not

waived, has occurred in the three years prior to the Signing Date or is reasonably expected to occur, (3) the fair market value

of the assets under each Plan exceeds the present value of all benefits accrued under such Plan (determined based on the

assumptions used to fund such Plan) and (4) neither the Company nor any member of its Controlled Group has incurred in

the six years prior to the Signing Date, or reasonably expects to incur, any liability under Title IV of ERISA (other than

contributions to the Plan or premiums to the PBGC in the ordinary course and without default) in respect of a Plan (including

any Plan that is a "multiemployer plan", within the meaning of Section 400l(c)(3) of ERISA); and (C) each Plan that is

intended to be qualified under Section 40 I(a) of the Code has received a favorable determination letter from the Internal

Revenue Service with respect to its qualified status that has not been revoked, or such a determination letter has been timely

applied for but not received by the Signing Date, and nothing has occurred, whether by action or by failure to act, which

could reasonably be expected to cause the loss, revocation or denial of such qualified status or favorable determination letter.

(0) Taxes. Except as would not, individually or in the aggregate, reasonably be expected to have a Company Material

Adverse Effect, (i) the Company and the Company Subsidiaries have filed all federal, state, local and foreign income and

franchise Tax returns required to be filed through the Signing Date, subject to permitted extensions, and have paid all Taxes

due thereon, and (ii) no Tax deficiency has been determined adversely to the Company or any of the Company Subsidiaries,

nor does the Company have any knowledge of any Tax deficiencies. "Tax" or "Taxes" means any federal, state, local or

foreign income, gross receipts, property, sales, use, license, excise, franchise, employment, payroll, withholding, alternative

or add on minimum, ad valorem, transfer or excise tax, or any other tax, custom, duty, governmental fee or other like

assessment or charge of any kind whatsoever, together with any interest or penalty, imposed by any Governmental Entity.

(p) Properties and Leases. Except as would not, individually or in the aggregate, reasonably be expected to have a

Company Material Adverse Effect, the Company and the Company Subsidiaries have good and marketable title to all real

properties and all other properties and assets owned by them, in each case free from liens, encumbrances, claims and defects

(other than liens, encumbrances, claims or defects created pursuant to the Guarantee and Pledge Agreement, dated as of

September 22, 2008, between the Company and the FRBNY) that would affect the value thereof or interfere with the use

made or to be made thereof by them. Except as would not, individually or in the aggregate, reasonably be expected to have a

Company Material Adverse Effect, the Company and the Company Subsidiaries hold all leased real or personal property

under valid and enforceable leases with no exceptions that would interfere with the use made or to be made thereof by them.

(q) Environmental Liability. Except as would not, individually or in the aggregate, reasonably be expected to have a

Company Material Adverse Effect:

(i) there is no legal, administrative, or other proceeding, claim or action of any nature seeking to impose, or that would

reasonably be expected to result in the

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imposition of, on the Company or any Company Subsidiary, any liability relating to the release of hazardous substances as

defined under any local, state or federal environmental statute, regulation or ordinance, including the Comprehensive

Environmental Response, Compensation and Liability Act of 1980, pending or, to the Company's knowledge, threatened

against the Company or any Company Subsidiary;

(ii) to the Company's knowledge, there is no reasonable basis for any such proceeding, claim or action; and

(iii) neither the Company nor any Company Subsidiary is subject to any agreement, order, judgment or decree by or

with any court, Governmental Entity or third party imposing any such environmental liability.

(r) Risk Management Instruments. Except as would not, individually or in the aggregate, reasonably be expected to have a

Company Material Adverse Effect, all derivative instruments, including, swaps, caps, floors and option agreements, whether

entered into for the Company's own account, or for the account of one or more of the Company Subsidiaries or its or their

customers, were entered into (i) only in the ordinary course of business, (ii) in accordance with prudent practices and in all

material respects with all applicable laws, rules, regulations and regulatory policies and (iii) with counterparties believed to

be financially responsible at the time; and each of such instruments constitutes the valid and legally binding obligation of the

Company or one of the Company Subsidiaries, enforceable in accordance with its terms, except as may be limited by the

Bankruptcy Exceptions. Neither the Company or the Company Subsidiaries, nor, to the knowledge of the Company, any

other party thereto, is in breach of any of its obligations under any such agreement or arrangement other than such breaches

that would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

(s) Agreements with Regulatory Agencies. Except as set forth on Schedule E, neither the Company nor any Company

Subsidiary is subject to any material cease-and-desist or other similar order or enforcement action issued by, or is a party to

any material written agreement, consent agreement or memorandum of understanding with, or is a party to any commitment

letter or similar undertaking to, or is subject to any capital directive by, or since December 31, 2006, has adopted any board

resolutions at the request of, any Governmental Entity (other than the primary insurance regulators with jurisdiction over the

Company Subsidiaries) that currently restricts in any material respect the conduct of its business or that in any material

manner relates to its capital adequacy, its liquidity and funding policies and practices, its ability to pay dividends, its credit,

risk management or compliance policies or procedures, its internal controls, its management or its operations or business.

Each item in the immediately preceding sentence and without taking into consideration of (he parenthetical provided therein,

is referred to herein as a "Regulatory Agreement." Neither the Company nor any Company Subsidiary has been advised

since December 31, 2006 by any such Governmental Entity that it is considering issuing, initiating, ordering, or requesting

any such Regulatory Agreement (other than any such Regulatory Agreement that does not have a Company Material Adverse

Effect). Except as set forth on Schedule E, the Company and each Company Subsidiary are in compliance in all material

respects with each Regulatory Agreement to which it is party or subject, and neither the

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Company nor any Company Subsidiary has received any notice from any Governmental Entity indicating that either the

Company or any Company Subsidiary is not in compliance in all material respects with any such Regulatory Agreement.

(t) Insurance. The Company and the Company Subsidiaries are insured with reputable insurers against such risks and in

such amounts as the management of the Company reasonably has determined to be prudent and consistent with industry

practice. The Company and the Company Subsidiaries are in material compliance with their insurance policies and are not in

default under any of the material terms thereof, each such policy is outstanding and in full force and effect, all premiums and

other payments due under any material policy have been paid, and all claims thereunder have been filed in due and timely

fashion, except, in each case, as would not, individually or in the aggregate, reasonably be expected to have a Company

Material Adverse Effect.

(u) Intellectual Property. Except as would not, individually or in the aggregate, reasonably be expected to have a Company

Material Adverse Effect, (i) the Company and each Company Subsidiary owns or otherwise has the right to use, all

intellectual property rights, including all trademarks, trade dress, trade names, service marks, domain names, patents,

inventions, trade secrets, know-how, works of authorship and copyrights therein, that are used in the conduct of their existing

businesses and all rights relating to the plans, design and specifications of any of its branch facilities ("Proprietary Rights")

free and clear of all liens and any claims of ownership by current or former employees, contractors, designers or others and

(ii) neither the Company nor any of the Company Subsidiaries is materially infringing, diluting, misappropriating or

violating, nor has the Company or any or the Company Subsidiaries received any written (or, to the knowledge of the

Company, oral) communications alleging that any of them has materially infringed, diluted, misappropriated or violated, any

of the Proprietary Rights owned by any other person. Except as would not, individually or in the aggregate, reasonably be

expected to have a Company Material Adverse Effect, to the Company's knowledge, no other person is infringing, diluting,

misappropriating or violating, nor has the Company or any or the Company Subsidiaries sent any written communications

since January I, 2006 alleging that any person has infringed, diluted, misappropriated or violated, any of the Proprietary

Rights owned by the Company and the Company Subsidiaries.

(v) Brokers and Finders. No broker, finder or investment banker is entitled to any financial advisory, brokerage, finder's

or other fee or commission in connection with this Agreement or the Warrant or the transactions contemplated hereby or

thereby based upon arrangements made by or on behalf of the Company or any Company Subsidiary for which the Investor

could have any liability.

Article 3

Covenants

3.) Consummation ofPurchase and Charter Amendment.

(a) Subject to the terms and conditions of this Agreement, each of the parties will use its commercially reasonable efforts

in

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good faith to take, or cause to be taken, all actions, and to do, or cause to be done, all things necessary, proper or desirable, or

advisable under applicable laws, so as to permit consummation of the Purchase as promptly as practicable and otherwise to

enable consummation of the transactions contemplated hereby and shall use commercially reasonable efforts to cooperate

with the other party to that end.

(b) The Company shall call a special meeting of its stockholders to vote on a proposal (the "Stockholder Proposal") to

amend the Company's Charter to allow the Preferred Stock to rank senior to the Series C Preferred Stock and any other series

of preferred stock issued by the Company. In connection with such meeting, the Company shall prepare (and the Investor will

reasonably cooperate with the Company to prepare) and file with the SEC as promptly as practicable (but in no event more

than ten business days after the issuance of the Series C Preferred Stock) a preliminary proxy statement, shall use its

reasonable best efforts to respond to any comments of the SEC or its staff thereon and to cause a definitive proxy statement

related to such stockholders' meeting to be mailed to the Company's stockholders not more than five business days after

clearance thereof by the SEC. The Company shall notify the Investor promptly of the receipt of any comments from the SEC

or its staff with respect to the proxy statement and of any request by the SEC or its staff for amendments or supplements to

such proxy statement or for additional information and will supply the Investor with copies of all correspondence between the

Company or any of its representatives, on the one hand, and the SEC or its staff, on the other hand, with respect to such proxy

statement. If at any time prior to such stockholders' meeting there shall occur any event that is required to be set forth in an

amendment or supplement to the proxy statement, the Company shall as promptly as practicable prepare and mail to its

stockholders such an amendment or supplement. Each of the Investor and the Company agrees promptly to correct any

information provided by it or on its behalf for use in the proxy statement if and to the extent that such information shall have

become false or misleading in any material respect, and the Company shall as promptly as practicable prepare and mail to its

stockholders an amendment or supplement to correct such information to the extent required by applicable laws and

regulations. The Company shall consult with the Investor prior to filing any proxy statement, or any amendment or

supplement thereto, and provide the Investor with a reasonable opportunity to comment thereon. In the event that the

approval of the Stockholder Proposal is not obtained at such special stockholders meeting, the Company shall include a

proposal to approve such proposal at a meeting of its stockholders no less than once in each subsequent twelve-month period

beginning on January I, 2009 until such approval is obtained or made.

(c) None of the information supplied by the Company or any of the Company Subsidiaries for inclusion in any proxy

statement in connection with any such stockholders meeting of the Company will, at the date it is filed with the SEC, when

first mailed to the Company's stockholders and at the time of any stockholders meeting, and at the time of any amendment or

supplement thereof, contain any untrue statement of a material fact or omit to state any material fact necessary in order to

make the statements therein, in light of the circumstances under which they are made, not misleading.

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3.2 Expenses. Unless otherwise provided in this Agreement or the Warrant, each of the parties hereto will bear and pay all

costs and expenses incurred by it or on its behalf in connection with the transactions contemplated under this Agreement or

the Warrant, including fees and expenses of its own financial or other consultants. investment bankers, accountants and

counsel.

3.3 Sufficiency ofAuthorized Common Stock; Exchange Listing.

(a) During the period from the Closing Date until the date on which the Warrant has been fully exercised. the Company

shall at all times have reserved for issuance, free of preemptive or similar rights, a sufficient number of authorized and

unissued Warrant Shares to effectuate such exercise. Nothing in this Section 3.3 shall preclude the Company from satisfying

its obligations in respect of the exercise of the Warrant by delivery of shares of Common Stock which are held in the treasury

of the Company. As soon as reasonably practicable following the Closing, the Company shall, at its expense, cause the

Warrant Shares to be listed on the same national securities exchange on which the Common Stock is listed, subject to official

notice of issuance, and shall maintain such listing for so long as any Common Stock is listed on such exchange.

(b) Ifrequested by the Investor, the Company shall promptly use its reasonable best efforts to cause the Preferred Stock to

be approved for listing on a national securities exchange as promptly as practicable following such request.

3.4 Certain Notifications Until Closing. From the Signing Date until the Closing, the Company shall promptly notify the

Investor of (i) any fact, event or circumstance of which it is aware and which would reasonably be expected to cause any

representation or warranty of the Company contained in this Agreement to be untrue or inaccurate in any material respect or

to cause any covenant or agreement of the Company contained in this Agreement not to be complied with or satisfied in any

material respect and (ii) except as Previously Disclosed, any fact, circumstance, event, change, occurrence, condition or

development of which the Company is aware and which, individually or in the aggregate, has had or would reasonably be

expected to have a Company Material Adverse Effect; provided. however, that delivery of any notice pursuant to this

Section 3.4 shall not limit or affect any rights of or remedies available to the Investor; provided. further, that a failure to

comply with this Section 3.4 shall not constitute a breach of this Agreement or the failure of any condition set forth in

Section 1.2 to be satisfied unless the underlying Company Material Adverse Effect or material breach would independently

result in the failure of a condition set forth in Section 1.2 to be satisfied.

3.5 Information and Confidentiality.

(a) Until such time as the Investor ceases to own any Preferred Stock, or except as otherwise agreed, the Company shall

provide the Investor (i) the information required to be provided by the Company to FRBNY pursuant to Section 5.04 of the

Credit Agreement and within the time periods for delivery thereof specified in the Credit Agreement and (ii) the notices

required by Section 5.05 of the Credit Agreement and within the time periods for delivery

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thereofspecified in the Credit Agreement. After the termination of the Credit Agreement, such informational and notice

requirements as are provided in Section 5.04 and Section 5.05 of the Credit Agreement shall remain in full force and effect

until such time as the Investor no longer owns any Preferred Stock. In addition. until such time as the Investor ceases to own

any debt or equity securities pursuant to this Agreement or the Warrant, or except as otherwise agreed, the Company shall

provide the Investor a hi-annual report on the steps taken by the Company to comply in all respects with Section lll(b) of

the EESA, including the provisions for Systemically Significant Failing Institutions, as implemented by any guidance or

regulation thereunder, including Notice 2008-PSSFI, and with Section 4.10 of this Agreement. In addition, the Company

shall promptly provide the Investor such other information and notices as the Investor may reasonably request from time to

time.

(b) The Investor will use reasonable best efforts to hold, and will use reasonable best efforts to cause its agents,

consultants, contractors and advisors to hold, in confidence all non-public records, books, contracts, instruments, computer

data and other data and information (collectively, "Information") concerning the Company furnished or made available to it

by the Company or its representatives pursuant to this Agreement (except to the extent that such information can be shown to

have been (i) previously known by such party on a non-confidential basis, (ii) in the public domain through no fault ofsuch

party or (iii) later !awfully acquired from other sources by the party to which it was furnished (and without violation of any

other confidentiality obligation»; provided that nothing herein shall prevent the Investor from disclosing any Information to

the extent required by applicable laws or regulations or by any subpoena or similar legal process.

Article 4

Additional Agreements

4.1 Purchase of Restricted Securities. The Investor acknowledges that the Purchased Securities and the Warrant Shares

have no' been registered under the Securities Act or under any state securities laws. The Investor (a) is acquiring the

PI'" ' ... d Securities pursuant to an exemption from registration under the Securities Act with no present intention to

di ·.. lbute them to any person in violation of the Securities Act or any applicable U.S. state securities laws, (b) will not sell or

otherwise 0' .'se of any of the Purchased Securities or the Warrant Shares, except in compliance with the registration ,

reQui.·exemption provisions of the Securities Act and any applicable U.S. state securities laws, and (c) has such

. experience in financial and business matters and in investments of this type that it is capable of evaluating the

.."s of the ,Purchase and of making an informed investment decision.

4.2 Legends..

-'-'h:' . "'"'stor agrees that all certificates or other instruments representing the Warrant and the Warrant Shares will bear

a k ltially to the following effect:

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"THE SECURITIES REPRESENTED BY TIllS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE

SECURITIES ACT OF 1933. AS AMENDED. OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE

TRANSFERRED. SOLD OR OTHERWISE DISPOSED OF EXCEPT WHll...E A REGISTRATION STATEMENT

RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR

PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS."

(b) In addition, the Investor agrees that all certificates or other instruments representing the Preferred Stock will bear a

legend substantially to the following effect:

"THE SECURITIES REPRESENTED BY TIllS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE

SECURITIES ACT OF 1933. AS AMENDED (THE "SECURITIES ACT"). OR THE SECURITIES LAWS OF ANY

STATE AND MAY NOT BE TRANSFERRED. SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A

REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE

STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT

OR SUCH LAWS. EACH PURCHASER OF THE SECURITIES REPRESENTED BY THIS INSTRUMENT IS

NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM SECTION 5 OF THE

SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. ANY TRANSFEREE OF THE SECURITIES

REPRESENTED BY TIllS INSTRUMENT BY ITS ACCEPTANCE HEREOF (I) REPRESENTS THAT IT IS A

"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT).

(2) AGREES THAT IT WilL NOT OFFER, SELL OR OTHERWISE TRANSFER THE SECURITIES REPRESENTED

BY TIDS INSTRUMENT EXCEPT (A) PURSUANT TO A REGISTRATION STATEMENT WIllCH IS THEN

EFFECTIVE UNDER THE SECURITIES ACT. (B) FOR SO LONG AS THE SECURITIES REPRESENTED BY TIDS

INSTRUMENT ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A. TO A PERSON IT REASONABLY

BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES

ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED

INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN

RELIANCE ON RULE 144A, (C) TO THE ISSUER OR (D) PURSUANT TO ANY OTHER AVAILABLE

EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT

IT WILL GIVE TO EACH PERSON TO WHOM THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE

TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF TIllS LEGEND."

(c) In the event that any Purchased Securities or Warrant Shares (i) become registered under the Securities Act or (ii) are

eligible to be transferred without restriction in accordance with Rule 144 or another exemption from registration under the

Securities Act (other than Rule 144A). the Company shall issue new certificates or other instruments representing such

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Purchased Securities or Warrant Shares, which shall not contain the applicable legends in Sections 4.2(a) and (b) above;

provided that the Investor surrenders to the Company the previously issued certificates or other instruments. Upon Transfer

of all or a portion of the Warrant in compliance with Section 4.4 the Company shall issue new certificates or other

instruments representing the Warrant, which shall not contain the applicable legend in Section 4.2(b) above; provided that the

Investor surrenders to the Company the previously issued certificates or other instruments.

4.3 Certain Transactions. The Company will not merge or consolidate with, or sell, transfer or lease all or substantially all

of its property or assets to, any other party unless the successor, transferee or lessee party (or its ultimate parent entity), as the

case may be (if not the Company), expressly assumes the due and punctual performance and observance of each and every

covenant, agreement and condition of this Agreement to be performed and observed by the Company.

4.4 Transfer ofPurchased Securities, the Warrant and Warrant Slwres. Subject to compliance with applicable securities

laws, the Investor shall be permitted to transfer, sell, assign or otherwise dispose of ("Transfer") all or a portion of the

Purchased Securities, the Warrant or Warrant Shares at any time, and the Company shall take all steps as may be reasonably

requested by the Investor to facilitate the Transfer of the Purchased Securities, the Warrant and the Warrant Shares.

4.5 Registration Rights.

(a) Registration.

(i) Subject to the terms and conditions of this Agreement, the Company covenants and agrees that as promptly as

practicable after notification from the Investor, and in any event no later than 15 days after such notification, the Company

shall prepare and file with the SEC a Shelf Registration Statement covering all Registrable Securities (or otherwise

designate an existing Shelf Registration Statement filed with the SEC to cover the Registrable Securities), and, to the

extent the Shelf Registration Statement has not theretofore been declared effective or is not automatically effective upon

such filing, the Company shall use reasonable best efforts to cause such Shelf Registration Statement to be declared or

become effective and to keep such Shelf Registration Statement continuously effective and in compliance with the

Securities Act and usable for resale of such Registrable Securities for a period from the date of its initial effectiveness until

such time as there are no Registrable Securities remaining (including by refiling such Shelf Registration Statement (or a

new Shelf Registration Statement) if the initial ShelfRegistration Statement expires). So long as the Company is a well

known seasoned issuer (as defined in Rule 405 under the Securities Act) at the time of filing of the Shelf Registration

Statement with the SEC, such ShelfRegistration Statement shall be designated by the Company as an automatic Shelf

Registration Statement.

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(ii) Any registration pursuant to Section 4.5(a)(i) shall be effected by means of a shelf registration on an appropriate

form under Rule 415 under the Securities Act (a "Shelf Registration Statement"). If the Investor or any other Holder

intends to distribute any Registrable Securities by means of an underwritten offering it shall promptly so advise the

Company and the Company shall take all reasonable steps to facilitate such distribution, including the actions required

pursuant to Section 4.5(c); provided that the Company shall not be required to facilitate an underwritten offering of

Registrable Securities unless the expected gross proceeds from such offering exceed $200 million. The lead underwriters

in any such distribution shall be selected by the Holders of a majority of the Registrable Securities to be distributed.

(iii) The Company shall not be required to effect a registration (including a resale ofRegistrable Securities from an

effective Shelf Registration Statement) or an underwritten offering pursuant to Section 4.5(a): (A) with respect to securities

that are not Registrable Securities; or (B) if the Company has notified the Investor and all other Holders that in the good

faith jUdgment of the Board of Directors, it would be materially detrimental to the Company or its securityholders for such

registration or underwritten offering to be effected at such time, in which event the Company shall have the right to defer

such registration for a period of not more than 45 days after receipt of the request of the Investor or any other Holder;

provided that such right to delay a registration or underwritten offering shall be exercised by the Company (1) only if the

Company has generally exercised (or is concurrently exercising) similar black-out rights against holders of similar

securities that have registration rights and (2) not more than three times in any 12-month period and not more than 90 days

in the aggregate in any 12-month period.

(iv) If during any period when an effective Shelf Registration Statement is not available, the Company proposes to

register any of its equity securities. other than a registration pursuant to Section 4.5(a)(i) or a Special Registration, and the

registration form to be filed may be used for the registration or qualification for distribution of Registrable Securities, the

Company will give prompt written notice to the Investor and all other HOlders of its intention to effect such a registration

(but in no event less than ten days prior to the anticipated filing date) and will include in such registration all Registrable

Securities with respect to which the Company has received written requests for inclusion therein within ten business days

after the date of the Company's notice (a "Piggyback Registration"). Any such person that has made such a written

request may withdraw its Registrable Securities from such Piggyback Registration by giving written notice to the

Company and the managing underwriter, if any, on or before the fifth business day prior to the planned effective date of

such Piggyback Registration. The Company may terminate or withdraw any registration under this Section 4.5(a)(iv) prior

to the effectiveness of such registration. whether or not Investor or any other Holders have elected to include Registrable

Securities in such registration.

(v) If the registration referred to in Section 4.5(a)(iv) is proposed to be underwritten. the Company will so advise

Investor and all other Holders as a part of the written notice given pursuant to Section 4.5(a)(iv). In such event, the right of

Investor

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and all other Holders to registration pursuant to Section 4.5(a) wiIl be conditioned upon such persons' participation in such

underwriting and the inclusion of such person's Registrable Securities in the underwriting if such securities are of the same

class of securities as the securities to be offered in the underwritten offering, and each such person will (together with the

Company and the other persons distributing their securities through such underwriting) enter into an underwriting

agreement in customary form with the underwriter or underwriters selected for such underwriting by the Company;

provided that the Investor (as opposed to other Holders) shall not be required to indemnify any person in connection with

any registration. If any participating person disapproves ofthe terms of the underwriting, such person may elect to

withdraw therefrom by written notice to the Company, the managing underwriters and the Investor (if the Investor is

participating in the underwriting).

(vi) If either (x) the Company grants "piggyback" registration rights to one or more third parties to include their

securities in an underwritten offering under a Shelf Registration Statement pursuant to Section 4.5(a)(ii) or (y) a Piggyback

Registration under Section 4.5(a)(iv) relates to an underwritten offering on behalf of the Company, and in either case the

managing underwriters advise the Company that in their reasonable opinion the number ofsecurities requested to be

included in such offering exceeds the number which can be sold without adversely affecting the marketability of such

offering (including an adverse effect on the per share offering price), the Company will include in such offering only such

number of securities that in the reasonable opinion ofsuch managing underwriters can be sold without adversely affecting

the marketability of the offering (including an adverse effect on the per share offering price), which securities will be so

included in the following order of priority: (A) first, in the case of a Piggyback Registration under Section 4.5(a)(iv), the

securities the Company proposes to sell, (B) then the Registrable Securities of the Investor and all other Holders who have

requested inclusion of Registrable Securities pursuant to Section 4.5(a)(ii) or Section 4.5(a)(iv), as applicable, pro rata on

the basis of the aggregate number of such securities or shares owned by each such person and (C) lastly, any other

securities of the Company that have been requested to be so included, subject to the terms of this Agreement; provided.

lwwever, that if the Company has, prior to the Signing Date, entered into an agreement with respect to its securities that is

inconsistent with the order of priority contemplated hereby then it shall apply the order of priority in such conflicting

agreement to the extent that it would otherwise result in a breach under such agreement.

(b) Ex.penses of Registration. All Registration Expenses incurred in connection with any registration, qualification or

compliance hereunder shall be borne by the Company. All Selling Ex.penses incurred in connection with any registrations

hereunder shall be borne by the holders of the securities so registered pro rata on the basis of the aggregate offering or sale

price ofthe securities so registered.

(c) Obligations ofthe Company. The Company shall use its reasonable best efforts, for so long as there are Registrable

Securities outstanding, to take such actions as are in its control to become a well-known seasoned issuer (as defined in

Rule 405 under the Securities Act)

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and once the Company becomes a well-known seasoned issuer to take such actions as are in its control to remain a weIlknown seasoned issuer. In addition, whenever required to effect the registration of any Registrable Securities or facilitate the

distribution of Registrable Securities pursuant to an effective Shelf Registration Statement, the Company shall, as

expeditiously as reasonably practicable:

(i) Prepare and file with the SEC, not later than fifteen (IS) days after the request, a registration statement with respect

to such Rf:;gistrable Securities and use all commercially reasonable efforts to cause such registration statement to become

effective, or prepare and file with the SEC not later than ten (10) days after the request a prospectus supplement with

respect to a proposed offering ofsuch Registrable Securities pursuant to an effective registration statement, subject to

Section 4.5(d), and, upon the request ofthe Holders of a majority of the Registrable Securities registered thereunder, use

all commercially reasonable efforts to keep such registration statement effective and keep such prospectus supplement

current until the securities described therein are no longer Registrable Securities.

(ii) Prepare and file with the SEC such amendments and supplements to the applicable registration statement and the

prospectus or prospectus supplement used in connection with such registration statement as may be necessary to comply

with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration

statement.

(iii) Furnish to the Holders and any underwriters such number of copies of the applicable registration statement and

each such amendment and supplement thereto (including in each case all exhibits) and of a prospectus, including a

preliminary prospectus, in conformity with the requirements of the Securities Act, and such other documents as they may

reasonably request in order to facilitate the disposition of Registrable Securities owned or to be distributed by them.

(iv) Use its reasonable best efforts to register and qualify the securities covered by such registration statement under

such other securities or Blue Sky laws of such jurisdictions as shall be reasonably requested by the Holders or any

managing underwriter(s), to keep such registration or qualification in effect for so long as such registration statement

remains in effect, and to take any other action which may be reasonably necessary to enable such seller to consummate the

disposition in such jurisdictions of the securities owned by such Holder; provided that the Company shall not be required

in connection therewith or as a condition thereto to qualify to do business or to file a general consent to service of process

in any such states orjurisdictions.

(v) Notify each Holder ofRegistrable Securities at any time when a prospectus relating thereto is required to be

delivered under the Securities Act of the happening of any event as a result of which the applicable prospectus, as then in

effect, includes an untrue statement of a material fact or omits to state a material fact required to

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be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing.

(vi) Give written notice to the Holders:

(A) when any registration statement filed pursuant to Section 4.5(a) or any amendment thereto has been filed with the

SEC (except for any amendment effected by the filing of a document with the SEC pursuant to the Exchange Act) and

when such registration statement or any post-effective amendment thereto has become effective;

(B) of any request by the SEC for amendments or supplements to any registration statement or the prospectus

included therein or for additional information;

(C) of the issuance by the SEC of any stop order suspending the effectiveness of any registration statement or the

initiation of any proceedings for that purpose;

(D) of the receipt by the Company or its legal counsel of any notification with respect to the suspension of the

qualification of the Common Stock for sale in any jurisdiction or the initiation or threatening of any proceeding for such

purpose;

(E) of the happening of any event that requires the Company to make changes in any effective registration statement

or the prospectus related to the registration statement in order to make the statements therein not misleading (which

notice shall be accompanied by an instruction to suspend the use of the prospectus until the requisite changes have been

made); and

(F) if at any time the representations and warranties of the Company contained in any underwriting agreement

contemplated by Section 4.5(c)(x) cease to be true and correct.

(vii) Use its reasonable best efforts to prevent the issuance or obtain the withdrawal of any order suspending the

effectiveness of any registration statement referred to in Section 4.5(c)(vi)(C) at the earliest practicable time.

(viii) Upon the occurrence of any event contemplated by Section 4.5(c)(v)or 4.5(c)(vi)(E), promptly prepare a posteffective amendment to such registration statement or a supplement to the related prospectus or file any other required

document so that, as thereafter delivered to the Holders and any underwriters, the prospectus will not contain an untrue

statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the

circumstances under which they were made, not misleading. If the Company notifies the Holders in accordance with

Section 4.5(c)(vi)(E)

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to suspend the use of the prospectus until the requisite changes to the prospectus have been made, then the Holders and any

underwriters shall suspend use of such prospectus and use their reasonable best efforts to return to the Company all copies

of such prospectus (at the Company's expense) other than permanent file copies then in such Holders' or underwriters'

possession. The total number of days that any such suspension may be in effect in any l2-month period shall not exceed

90 days.

(ix) Use reasonable best efforts to procure the cooperation of the Company's transfer agent in settling any offering or

sale of Registrable Securities, including with respect to the transfer of physical stock certificates into book-entry form in

accordance with any procedures reasonably requested by the Holders or any managing underwriter(s).

(x) If an underwritten offering is requested pursuant to Section 4.5(a)(ii), enter into an underwriting agreement in

customary form, scope and substance and take all such other actions reasonably requested by the HOlders of a majority of

the Registrable Securities being sold in connection therewith or by the managing underwriter(s), if any, to expedite or

facilitate the underwritten disposition of such Registrable Securities, and in connection therewith in any underwritten

offering (including making members of management and executives ofthe Company available to participate in "road

shows", similar sales events and other marketing activities), (A) make such representations and warranties to the Holders

that are selling stockholders and the managing underwriter(s), if any, with respect to the business of the Company and its

subsidiaries, and the Shelf Registration Statement, prospectus and documents, if any, incorporated or deemed to be

incorporated by reference therein, in each case, in customary form, substance and scope, and, if true, confirm the same if

and when requested, (B) use its reasonable best efforts to furnish the underwriters with opinions of counsel to the

Company, addressed to the managing underwriter(s), if any, covering the matters customarily covered in such opinions

requested in underwritten offerings, (C) use its reasonable best efforts to obtain "cold comfort" letters from the

independent certified public accountants of the Company (and, if necessary, any other independent certified public

accountants of any business acquired by the Company for which financial statements and financial data are included in the

Shelf Registration Statement) who have certified the financial statements included in such Shelf Registration Statement,

addressed to each of the managing underwriter(s), if any, such letters to be in customary form and covering matters of the

type customarily covered in "cold comfort" letters, (D) if an underwriting agreement is entered into, the same shall contain

indemnification provisions and procedures customary in underwritten offerings (provided that the Investor shall not be

obligated to provide any indemnity), and (E) deliver such documents and certificates as may be reasonably requested by

the Holders of a majority of the Registrable Securities being sold in connection therewith, their counsel and the managing

underwriter(s), if any, to evidence the continued validity of the representations and warranties made pursuant to clause

(A) above and to evidence compliance with any customary conditions contained in the underwriting agreement or other

agreement entered into by the Company.

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(xi) Make available for inspection by a representative of Holders that are selling stockholders, the managing

underwriter(s), if any, and any attorneys or accountants retained by such Holders or managing underwriter(s), at the offices

where normally kept, during reasonable business hours, financial and other records, pertinent corporate documents and

properties of the Company, and cause the officers, directors and employees of the Company to supply all information in

each case reasonably requested (and of the type customarily provided in connection with due diligence conducted in

connection with a registered public offering of securities) by any such representative, managing underwriter(s), attorney or

accountant in connection with such ShelfRegistration Statement.

(xii) Use reasonable best efforts to cause all such Registrable Securities to be listed on each national securities exchange

on which similar securities issued by the Company are then listed or, if no similar securities issued by the Company are

then listed on any national securities exchange, use its reasonable best efforts to cause all such Registrable Securities to be

listed on such securities exchange as the Investor may designate.

(xiii) If requested by Holders of a majority of the Registrable Securities being registered and/or sold in connection

therewith, or the managing underwriter(s), if any, promptly include in a prospectus supplement or amendment such

information as the Holders of a majority of the Registrable Securities being registered and/or sold in connection therewith

or managing underwriter(s), if any, may reasonably request in order to permit the intended method of distribution of such

securities and make all required filings of such prospectus supplement or such amendment as soon as practicable after the

Company has received such request.

(xiv) Timely provide to its security holders earning statements satisfying the provisions of Section lI(a) of the

Securities Act and Rule 158 thereunder.

(d) Suspension ofSales. Upon receipt of written notice from the Company that a registration statement, prospectus or

prospectus supplement contains or may contain an untrue statement of a material fact or omits or may omit to state a material

fact required to be stated therein or necessary to make the statements therein not misleading or that circumstances exist that

make inadvisable use of such registration statement, prospectus or prospectus supplement, the Investor and each Holder of

Registrable Securities shall forthwith discontinue disposition of Registrable Securities until the Investor and/or Holder has

received copies of a supplemented or amended prospectus or prospectus supplement, or until the Investor and/or such Holder

is advised in writing by the Company that the use of the prospectus and, if applicable, prospectus supplement may be

resumed, and, ifso directed by the Company, the Investor and/or such Holder shall deliver to the Company (at the

Company's expense) all copies, other than permanent file copies then in the Investor and/or such Holder's possession, of the

prospectus and, if applicable, prospectus supplement covering such Registrable Securities current at the time of receipt of

such notice. The total number of days that any such suspension may be in effect in any 12-month period shall not exceed

90 days.

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(e) Termination ofRegistration Rights. A Holder's registration rights as to any securities held by such Holder (and its

Affiliates, partners, members and former members) shall not be available unless such securities are Registrable Securities.

(f) Furnishing Information.

(i) Neither the Investor nor any Holder shall use any free writing prospectus (as defined in Rule 405) in connection with

the sale ofRegistrable Securities without the prior written consent ofthe Company.

(ii) It shall be a condition precedent to the obligations of the Company to take any action pursuant to Section 4.5(c) that

Investor and/or the selling Holders and the underwriters, if any, shall furnish to the Company such information regarding

themselves, the Registrable Securities held by them and the intended method of disposition of such securities as shall be

required to effect the registered offering of their Registrable Securities.

(g) Indemnification.

(i) The Company agrees to indemnify each Holder and, if a Holder is a person other than an individual, such Holder's

officers, directors, employees, agents, representatives and Affiliates, and each Person, if any, that controls a Holder within

the meaning of the Securities Act (each, an "Indemnitee"), against any and all losses, claims, damages, actions, liabilities,

costs and expenses (including reasonable fees, expenses and disbursements of attorneys and other professionals incurred in

connection with investigating, defending, settling, compromising or paying any such losses, claims, damages, actions,

liabilities, costs and expenses), joint or several, arising out of or based upon any untrue statement or alleged untrue

statement of material fact contained in any registration statement, including any preliminary prospectus or final prospectus

contained therein or any amendments or supplements thereto or any documents incorporated therein by reference or

contained in any free writing prospectus (as such term is defined in Rule 405) prepared by the Company or authorized by it

in writing for use by such Holder (or any amendment or supplement thereto); or any omission to state therein a material

fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which

they were made, not misleading; provided that the Company shall not be liable to such Indemnitee in any such case to the

extent that any such loss, claim, damage, liability (or action or proceeding in respect thereof) or expense arises out of or is

based upon (A) an untrue statement or omission made in such registration statement, including any such preliminary

prospectus or final prospectus contained therein or any such amendments or supplements thereto or contained in any free

writing prospectus (as such term is defined in Rule 405) prepared by the Company or authorized by it in writing for use by

such Holder (or any amendment or supplement thereto), in reliance upon and in conformity with information regarding

such Indemnitee or its plan of distribution or ownership interests which was furnished in writing to the Company by such

Indemnitee for use in connection with such registration statement, including any

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such preliminary prospectus or final prospectus contained therein or any such amendments or supplements thereto, or (B)

offers or sales effected by or on behalf of such Indemnitee "by means of' (as defined in Rule 159A) a "free writing

prospectus" (as defined in Rule 405) that was not authorized in writing by the Company.

(ii) If the indemnification provided for in Section 4.5(g)(i) is unavailable to an Indemnitee with respect to any losses,

claims, damages, actions, liabilities, costs or expenses referred to therein or is insufficient to hold the Indemnitee harmless

as contemplated therein, then the Company, in lieu of indemnifying such Indemnitee, shall contribute to the amount paid

or payable by such Indemnitee as a result of such losses, claims, damages, actions, liabilities, costs or expenses in such .

proportion as is appropriate to reflect the relative fault of the Indemnitee, on the one hand, and the Company, on the other

hand, in connection with the statements or omissions which resulted in such losses, claims, damages, actions, liabilities,

costs or expenses as well as any other relevant equitable considerations. The relative fault of the Company, on the one

hand, and of the Indemnitee, on the other hand, shall be determined by reference to, among other factors, whether the

untrue statement of a material fact or omission to state a material fact relates to information supplied by the Company or

by the Indemnitee and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent

such statement or omission; the Company and each Holder agree that it would not be just and equitable if contribution

pursuant to this Section 4.5(g)(ii) were determined by pro rata allocation or by any other method of allocation that does not

take account of the equitable considerations referred to in Section 4.5(g)(i). No Indemnitee guilty of fraudulent

misrepresentation (within the meaning of Section ll(f) of the Securities Act) shall be entitled to contribution from the

Company if the Company was not guilty of such fraudulent misrepresentation.

(h) Assignment of Registration Rights. The rights of the Investor to registration of Registrable Securities pursuant to

Section 4.5(a) may be assigned by the Investor to a transferee or assignee of Registrable Securities with a liquidation

preference or, in the case of Registrable Securities other than Preferred Stock, a market value, no less than an amount equal

$200 million; provided, however, the transferor shall, within ten days after such transfer, furnish to the Company written

notice of the name and address of such transferee or assignee and the number and type of Registrable Securities that are being

assigned. For purposes of this Section 4.5(h), "market value" per share of Common Stock shall be the last reported sale price

of theCommon Stock on the national securities exchange on which the Common Stock is listed or admitted to trading on the

last trading day prior to the proposed transfer, and the "market value" for the Warrant (or any portion thereof) shall be the

market value per share of Common Stock into which the Warrant (or such portion) is exercisable less the exercise price per

share.

(i) Clear Market. With respect to any underwritten offering of Registrable Securities by the Investor or other Holders

pursuant to this Section 4.5, the Company agrees not to effect (other than pursuant to such registration or pursuant to a

Special Registration) any public sale or distribution, or to file any ShelfRegistration Statement (other than such registration

or a Special Registration) covering, in the case of an underwritten offering of Common Stock or Warrants,

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any of its equity securities or, in the case of an underwritten offering of Preferred Stock, any preferred stock of the Company,

or, in each case, any securities convertible into or exchangeable or exercisable for such securities, during the period not to

exceed ten days prior and 60 days following the effective date ofsuch offering or such longer period up to 90 days as may be

requested by the managing underwriter for such underwritten offering. The Company also agrees to cause such of its

directors and senior executive officers to execute and deliver customary lock-up agreements in such form and for such time

period up to 90 days as may be requested by the managing underwriter. "Special Registration" means the registration of

(A) equity securities and/or options or other rights in respect thereofsolely registered on Form S-4 or Form S-8 (or successor

form) or (B) shares of equity securities and/or options or other rights in respect thereof to be offered to directors, members of

management, employees, consultants, customers, lenders or vendors of the Company or Company Subsidiaries or in

connection with dividend reinvestment plans.

G) Rule 144; Rule 144A. With a view to making available to the Investor and Holders the benefits of certain rules and

regulations of the SEC which may permit the sale of the Registrable Securities to the public without registration, the

Company agrees to use its reasonable best efforts to:

(i) make and keep public information available, as those terms are understood and defined in Rule I44(c)(l ) or any

similar or analogous rule promulgated under the Securities Act, at all times after the Signing Date;

(ii) (A) file with the SEC, in a timely manner, all reports and other documents required of the Company under the

Exchange Act, and (B) if at any time the Company is not required to file such reports, make available, upon the request of

any Holder, such information necessary to permit sales pursuant to Rule 144A (including the information required by

Rule 144A(d)(4) under the Securities Act);

(iii) so long as the Investor or a Holder owns any Registrable Securities, furnish to the Investor or such Holder forthwith

upon request: a written statement by the Company as to its compliance with the reporting requirements of Rule 144 under

the Securities Act, and of the Exchange Act; a copy of the most recent annual or quarterly report of the Company; and such

other reports and documents as the Investor or Holder may reasonably request in availing itself of any rule or regulation of

the SEC allowing it to sell any such securities to the public without registration; and

(iv) take such further action as any Holder may reasonably request, all to the extent required from time to time to enable

such Holder to sell Registrable Securities without registration under the Securities Act.

(k) As used in this Section 4.5, the following terms shall have the following respective meanings:

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(i) "Holder" means the Investor and any other holder of Registrable Securities to whom the registration rights conferred

by this Agreement have been transferred in compliance with Section 4.5(h) hereof.

(ii) "Holders' Counsel" means one counsel for the selling Holders chosen by Holders holding a majority interest in the

Registrable Securities being registered.

(iii) "Register," "registered," and "registration" shall refer to a registration effected by preparing and (A) filing a

registration statement in compliance with the Securities Act and applicable rules and regulations thereunder, and the

declaration or ordering of effectiveness ofsuch registration statement or (B) filing a prospectus andlor prospectus

supplement in respect of an appropriate effective registration statement on Form S-3.

(iv) "Registrable Securities" means (A) all Preferred Stock, (B) the Warrant (subject to Section 4.5(p» and (C) any

equity securities issued or issuable directly or indirectly with respect to the securities referred to in the foregoing clauses

«A) or (B) by way of conversion, exercise or exchange thereof, including the Warrant Shares, or share dividend or share

split or in connection with a combination of shares, recapitalization, reclassification, merger, amalgamation, arrangement,

consolidation or other reorganization, provided that, once issued, such securities will not be Registrable Securities when

(1) they are sold pursuant to an effective registration statement under the Securities Act, (2) except as provided below in

Section 4.5(0), they may be sold pursuant to Rule 144 without limitation thereunder on volume or manner of sale, (3) they

shall have ceased to be outstanding or (4) they have been sold in a private transaction in which the transferor's rights under

this Agreement are not assigned to the transferee of the securities. No Registrable Securities may be registered under more

than one registration statement at anyone time.

(v) "Registt:ation Expenses" mean all expenses incurred by the Company in effecting any registration pursuant to this

Agreement (whether or not any registration or prospectus becomes effective or final) or otherwise complying with its

obligations under this Section 4.5, including all registration, filing and listing fees, printing expenses, fees and

disbursements of counsel for the Company, blue sky fees and expenses, expenses incurred in connection with any "road

show", the reasonable fees and disbursements of Holders' Counsel, and expenses of the Company's independent

accountants in connection with any regular or special reviews or audits incident to or required by any such registration, but

shall not include Selling Expenses.

(vi) "Rule 144", "Rule 144A", "Rule 159A", "Rule 405" and "Rule 415" mean, in each case, such rule promulgated

under the Securities Act (or any successor provision), as the same shall be amended from time to time.

(vii) "Selling Expenses" mean all discounts, selling commissions and stock transfer taxes applicable to the sale of

Registrable Securities and fees and disbursements

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of counsel for any Holder (other than the fees and disbursements of Holders' Counsel included in Registration Expenses).

(I) At any time, any holder of Securities (including any Holder) may elect to forfeit its rights set forth in this Section 4.5

from that date forward; provided. that a Holder forfeiting such rights shall nonetheless be entitled to participate under

Section 4.5(a)(iv) - (vi) in any Pending Underwritten Offering to the same extent that such Holder would have been entitled

to if the holder had not withdrawn; and provided, further, that no such forfeiture shall terminate a Holder's rights or

obligations under Section 4.5(f) with respect to any prior registration or Pending Underwritten Offering. "Pending

Underwritten Offering" means, with respect to any Holder forfeiting its rights pursuant to this Section 4.5(1), any

underwritten offering ofRegistrable Securities in which such Holder has 'advised the Company of its intent to register its

Registrable Securities either pursuant to Section 4.5(a)(ii) or 4.5(a)(iv) prior to the date ofsuch Holder's forfeiture.

(m) Specific Performance. The parties hereto acknowledge that there would be no adequate remedy at law if the Company

fails to perform any of its obligations under this Section 4.5 and that the Investor and the Holders from time to time may be

irreparably harmed by any such failure, and accordingly agree that the Investor and such Holders, in addition to any other

remedy to which they may be entitled at law or in equity, to the fullest extent permitted and enforceable under applicable law

shall be entitled to compel specific performance of the obligations of the Company under this Section 4.5 in accordance with

the terms and conditions of this Section 4.5.

(n) No Inconsistent Agreements. The Company shall not, on or after the Signing Date, enter into any agreement with

respect to its securities that may impair the rights granted to the Investor and the Holders under this Section 4.5 or that

otherwise conflicts with the provisions hereof in any manner that may impair the rights granted to the Investor and the

Holders under this Section 4.5. In the event the Company has, prior to the Signing Date, entered into any agreement with

respect to its securities that is inconsistent with the rights granted to the Investor and the Holders under this Section 4.5

(including agreements that are inconsistent with the order of priority contemplated by Section 4.5(a)(vi» or that may

otherwise conflict with the provisions hereof, the Company shall use its reasonable best efforts to amend such agreements to

ensure they are consistent with the provisions of this Section 4.5.

(0) Certain Offerings by the Investor. In the case of any securities held by the Investor that cease to be Registrable

Securities solely by reason of clause (2) in the definition of "Registrable Securities," the provisions of Sections 4.5(a)(ii),

clauses (iv), (ix) and (x)-(xii) of Section 4.5(c), Section 4.5(g) and Section 4.5(i) shall continue to apply until such securities

otherwise cease to be Registrable Securities. In any such case, an "underwritten" offering or ether disposition shall include

any distribution of such securities on behalf of the Investor by one or more broker-dealers, an "underwriting agreement" shall

include any purchase agreement entered into by such broker-dealers, and any "registration statement" or "prospectus" shall

include any offering document approved by the Company and used in connection with such distribution.

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(p) Registered Sales of the Warrant. The Holders agree to sell the Warrant or any portion thereof under the Shelf

Registration Statement only beginning 30 days after notifying the Company of any such sale, during which 30-day period the

Investor and all Holders of the Warrant shall take reasonable steps to agree to revisions to the Warrant to permit a public

distribution of the Warrant, including entering into a warrant agreement and appointing a warrant agent.

4.6 Voting of Warrant Shares. Notwithstanding anything in this Agreement to the contrary, the Investor shall not exercise

any voting rights with respect to the Warrant Shares.

4.7 Depositary Shares. Upon request by the Investor in connection with a proposed transfer of the Preferred Stock, the

Company shall promptly enter into a depositary arrangement, pursuant to customary agreements reasonably satisfactory to

the Investor and with a depositary reasonably acceptable to the Investor, pursuant to which the Preferred Stock may be

deposited and depositary shares, each representing a fraction of a Preferred Stock as specified by the Investor, may be issued.

From and after the execution of any such depositary arrangement, and the deposit of any Preferred Stock pursuant thereto, the

depositary shares issued pursuant thereto shall be deemed "Preferred Stock" and, as applicable, "Registrable Securities"

for purposes of this Agreement.

4.8 Restriction on Dividends and Repurchases.

(a) Prior to the earlier of (x) the fifth anniversary of the Closing Date and (y) the date on which the Preferred Stock has

been redeemed in whole or the Investor has transferred all of the Preferred Stock to third parties which are not Affiliates of

the Investor, neither the Company nor any Company Subsidiary shall, without the consent of the Investor:

(i) declare or pay any dividend or make any distribution on the Common Stock (other than (A) regular quarterly cash

dividends of not more than the amount of the last quarterly cash dividend per share declared or, if lower, publicly

announced an intention to declare, on the Common Stock prior to November 25, 2008, as adjusted for any stock split, stock

dividend, reverse stock split, reclassification or similar transaction, (B)) dividends payable solely in shares of Common

Stock and (C) dividends or distributions of rights or Junior Stock in connection with a stockholders' rights plan); or

(ii) redeem, purchase or acquire any shares of Common Stock or other capital stock or other equity securities of any

kind of the Company, or any trust preferred securities issued by the Company or any Affiliate of the Company, other than

(A) redemptions, purchases or other acquisitions of the Preferred Stock, (B) redemptions, purchases or other acquisitions

of shares of Common Stock or other Junior Stock, in each case in this clause (B) in connection with the administration of

any employee benefit plan in the ordinary course of business (including purchases to offset the Share Dilution Amount (as

defined below) pursuant to a publicly announced repurchase plan) and consistent with past practice; provided that any

purchases to offset the Share Dilution Amount shall in no event exceed the Share Dilution Amount, (C) any redemption or

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repurchase of rights pursuant to any stockholders' rights plan, (D) the acquisition by the Company or any of the Company

Subsidiaries of record ownership in Junior Stock or Parity Stock for the beneficial ownership of any other persons (other

than the Company or any other Company Subsidiary), including as trustees or custodians (the "Permitted Repurchases"),

and (E)the exchange or conversion ofJunior Stock for or into other Junior Stock or of Parity Stock or trust preferred

securities for or into other Parity Stock (with the same or lesser aggregate liquidation amount) or Junior Stock, in each case

set forth in this clause (E), solely to the extent required pursuant to binding contractual agreements entered into prior to the

Signing Date or any subsequent agreement for the accelerated exercise, settlement or exchange thereof for Common Stock.

"Share Dilution Amount" means the increase in the number of diluted shares outstanding (determined in accordance with

GAAP, and as measured from the date of the Company's most recently filed Company Financial Statements prior to the

Closing Date) resulting from the grant, vesting or exercise of equity-based compensation to employees and equitably

adjusted for any stock split, stock dividend, reverse stock split, reclassification or similar transaction.

(b) Until such time as the Investor ceases to own any Preferred Stock, the Company shall not repurchase any Preferred

Stock from any holder thereof, whether by means of open market purchase, negotiated transaction, or otherwise, other than

Permitted Repurchases, unless it offers to repurchase a ratable portion of the Preferred Stock then held by the Investor on the

same terms and conditions.

(c) "Junior Stock" means Common Stock, the Series C Preferred Stock (after the Company's stockholders approve the

amendment described in Section 3.1 (b) to the Charter to have the Preferred Stock rank senior to the Series C Preferred Stock)

and any other class or series of stock of the Company the terms of which expressly provide that it ranks junior to the

Preferred Stock as to dividend rights and/or as to rights on liquidation, dissolution or winding up of the Company. "Parity

Stock" means the Series C Preferred Stock (before the Company's stockholders approve the Charter amendment referred to

above) and any class or series of stock of the Company the terms of which do not expressly provide that such class or series

will rank senior or junior to the Preferred Stock as to dividend rights and/or as to rights on liquidation, dissolution or winding

up of the Company (in each case without regard to whether dividends accrue cumulatively or non-cumulatively).

4.9 Repurchase ofInvestor Securities.

(a) Following the redemption in whole of the Preferred Stock held by the Investor or the Transfer by the Investor of all of

the Preferred Stock to one or more third parties not affiliated with the Investor and so long as the Investor does not Control

the Company, the Company may repurchase, in whole or in part, at any time any other equity or debt securities of the

Company owned by the Investor or the Warrant or Warrant Shares and then held by the Investor, upon notice given as

provided in clause (b) below, at the Fair Market Value of the equity security. For the avoidance of doubt, while there is Board

of Directors control (or the potential to gain Board of Directors control as a result of existing contractual rights) by the

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Investor (or any affiliate of the Investor), the Company may not exercise its rights under this Section 4.9.

(b) Notice of every repurchase of equity securities of the Company held by the Investor shall be given at the address and

in the manner set forth for such party in Section 5.6. Each notice of repurchase given to the Investor shall state: (i) the

number and type of securities to be repurchased, (ii) the Board of Directors' determination of Fair Market Value of such

securities and (iii) the place or places where certificates representing such securities are to be surrendered for payment of the

repurchase price. The repurchase of the securities specified in the notice shaH occur as soon as practicable following the

determination of the Fair Market Value of the securities.

(c) As used in this Section 4.9, the following terms shall have the following respective meanings:

(i) "Appraisal Procedure" means a procedure whereby two independent appraisers, one chosen by the Company and

one by the Investor, shaH mutuaHy agree upon the Fair Market Value. Each party shaH deliver a notice to the other

appointing its appraiser within 10 days after the Appraisal Procedure is invoked. If within 30 days after appointment of the

two appraisers they are unable to agree upon the Fair Market Value, a third independent appraiser shall be chosen within

10 days thereafter by the mutual consent of such first two appraisers. The decision of the third appraiser so appointed and

chosen shall be given within 30 days after the selection of such third appraiser. If three appraisers shall be appointed and

the determination of one appraiser is disparate from the middle determination by more than twice the amount by which the

other determination is disparate from the middle determination, then the determination ofsuch appraiser shall be excluded,

the remaining two determinations shall be averaged and such average shall be binding and conclusive upon the Company

and the Investor; otherwise, the average of all three determinations shall be binding upon the Company and the Investor.

The costs of conducting any Appraisal Procedure shall be borne by the Company.

(ii) "Fair Market Value" means, with respect to any security, the fair market value of such security as determined by

the Board of Directors, acting in good faith in reliance on an opinion of a nationally recognized independent investment

banking firm retained by the Company for this purpose and certified in a resolution to the Investor. If the Investor does not

agree with the Board of Directors' determination, it may object in writing within 10 days of receipt of the Board of

Directors' determination. In the event ofsuch an objection, an authorized representative of the Investor and the chief

executive officer of the Company shall promptly meet to resolve the objection and to agree upon the Fair Market Value. If

the chief executive officer and the authorized representative are unable to agree on the Fair Market Value during the 10-

day period following the delivery ofthe Investor's objection, the Appraisal Procedure may be invoked by either party to

determine the Fair Market Value by delivery of a written notification thereof not later than the 30th day after delivery of

the Investor's objection.

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(iii) "Control" means the power to direct the management and policies of the Company, directly or indirectly, whether

through the ownership of voting securities, by contract, by the power to control the Board of Directors or otherwise.

4.10 Executive Compensation.

(a) Until such time as the Investor ceases to own any debt or equity securities of the Company acquired pursuant to this

Agreement or the Warrant, the Company shall take all necessary action to ensure that its Benefit Plans with respect to the

Senior Executive Officers comply in all respects with Section 111(b) of the EESA, including the provisions for Systemically

Significant Failing Institutions, as implemented by any guidance or regulation thereunder, including Notice 2008-PSSFI, that

has been issued and is in effect as of the Closing Date, including but not limited to provisions prohibiting severance payments

to Senior Executive Officers, and shall not adopt any new Benefit Plan with respect to its Senior Executive Officers that does

not comply therewith. "Senior Executive Officers" means the Company's "senior executive officers" as defined in

subsection 111(b)(3) of the EESA and regulations issued thereunder, including the rules set forth in 31 CFR Part 30, that

have been issued and are in effect as of the Closing Date.

(b) (1) In addition, the Company shall, until such time as the Investor ceases to own any debt or equity securities of the

Company acquired pursuant to this Agreement or the Warrant, take all necessary action to limit any "golden parachute

payments" to the employees of the Company and the Company Subsidiaries who as of the Closing Date participate in the

Company's Senior Partners Plan (other than the Senior Executive Officers) (the "Senior Partners") to the amounts permitted

by the regulations relating to participants in the EESA Capital Purchase Program and the guidelines and rules relating thereto,

including the rules set forth in 31 CFR Part 30, that have been issued and are in effect as of the Closing Date, as if such

Senior Partners were Senior Executive Officers for purposes of the EESA (except that equity denominated awards settled

solely in equity shall not be included in such limit on "golden parachute payments" to Senior Partners).

(2) In furtherance of the Company's commitment to limit golden parachute payments to Senior Partners as set forth

in Section 4.1O(b)(l), and to ensure compliance with the provisions of the EESA Capital Purchase Program and the

guidelines and regulations relating thereto applicable to Senior Partners pursuant to Section 4.1O(b)( 1), it is further agreed

that the Company shall take all necessary ac~ion to ensure that the sum of (A) a Senior Partner's annual bonus for 2009,

(B) all retention payments paid or payable to such Senior Partner under any retention arrangement between the Senior

Partner and the Company for any period ending on or prior to March 31, 2010 and (C) any and all amounts paid or payable

to such Senior Partner in connection with the termination of such Senior Partner's employment prior to March 31, 2010

which would be taken into account in applying the compensation limitation under Section 4.1O(b)( 1) above, other than any

payments pursuant to outstanding awards under the Company's Senior Partners Plan, shall not exceed 3.5 times the sum of

such Senior Partner's base salary and target annual bonus for 2008. For this purpose, actual annual bonus for 2009

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and target annual bonus for 2008 will include supplemental bonus and quarterly cash payments under the Company's

historic quarterly bonus program consistent with, and in amounts not exceeding, past practice.

(3) Notwithstanding the other provisions of this Section 4.1O(b), the Company's obligations under this Section 4.10

(b) shall be on a best efforts basis with respect to the Senior Partners who are not U.S.-based to the extent of its existing

Benefit Plans. Without derogation of the condition set forth in Section 1.2(d)(v), the Company shall use its best efforts to

obtain from all the Senior Partners and deliver to the Investor prior to the Closing or as promptly as possible thereafter a

waiver in the form attached hereto as Annex B-1.

(c) Unless the Investor ceases to own any debt or equity securities of the Company acquired pursuant to this Agreement or

the Warrant, the Company shall take all necessary action to ensure that the annual bonus pools payable to the Senior

Executive Officers and the Senior Partners in respect of each of 2008 and 2009 shall not exceed the average of the annual

bonus pools paid to the Senior Executive Officers and the Senior Partners for 2006 and 2007 (in each case exclusive ofthe

Company's historic quarterly bonus program including but not limited to supplemental bonus and quarterly cash payments,

the amount of which will not increase for any participant) and subject to appropriate adjustment for new hires and departures.

(d) For the reasons set forth in Section 4.10(b)(2) above and in furtherance thereof, the Company shall, as soon as

practicable, take all necessary action to amend its Executive Severance Plan, effective not later than March 11, 2010, to

require that the benefits thereunder will be reduced by any remuneration attributable to a participant's subsequent

employment during the relevant severance period.

(e) The Company confirms that none of (i) the proceeds of the Purchase Price nor (ii) the funds provided to the Company

under the Credit Agreement (collectively "the Funds"), shall be used to pay annual bonuses, or other future cash performance

awards to executives of the Company or Senior Partners. The parties desire that this confirmation be auditable and agree that

there are a number of appropriate methods for verifying this confirmation (particularly in light of expected business changes

at the Company). Until the date that any annual bonuses in respect of 2009 are paid, it is agreed that the test for the foregoing

will be that, at the time when any annual bonuses or cash performance awards granted after the date of this Agreement are

paid to executive officers or Senior Partners, the Company will have received aggregate dividends, distributions and other

payments from its subsidiaries subsequent to September 16,2008 greater than the aggregate amount ofsuch annual bonuses,

such cash performance awards and amounts paid pursuant to AIG's historic quarterly bonus program (including but not

limited to supplemental bonus 'and quarterly cash payments, the amount of which will not increase for any participant) paid to

executive officers and Senior Partners subsequent to that date. At and after the date that any annual bonuses in respect of

2009 are paid, the test for the foregoing confirmation will be that, at the time when any annual bonuses or cash performance

awards granted after the date of this Agreement are vested or otherwise earned by executive officers or Senior Partners, the

aggregate adjusted net income for the relevant year (being the year in which

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or in respect of which such bonuses or awards are vested or so earned) of the insurance company subsidiaries of the

Company included for such year in the consolidated financial statements of the Company, excluding any such adjusted net

income that was dividended or otherwise distributed to the Company and taken into account in satisfying the test under the

prior sentence, shall exceed the aggregate amount of such annual bonuses, such cash performance awards and amounts

pursuant to AIG's historic quarterly bonus program (including but not limited to supplemental bonus and quarterly cash

payments, the amount of which will not increase for any participant), in each case vested or otherwise earned in or in respect

of such year. Each party agrees to negotiate in good faith and promptly at the request of the other to develop additional or

alternative appropriate formulations to test for this confirmation.

(f) The Company confirms that none of the Funds shall be used to pay any electively deferred compensation in respect of

or otherwise resulting from the termination of the deferred compensation plans by the Company or the Company subsidiaries

as described in Item 5.02 of the Company's Current Report on Form 8-K dated November 18,2008.

4.11 Restrictions on Lobbying. Until such time as the Investor ceases to own any Preferred Stock, the Company shall

continue to maintain and implement its comprehensive written policy on lobbying, governmental ethics and political activity

and distribute such policy to all Company employees and lobbying firms involved in any such activity. Any material

amendments to such policy shall require the prior written consent ofthe Investor until the Investor no longer owns any

Preferred Stock, and any material deviations from such policy, whether in contravention thereof or pursuant to waivers

provided for thereunder, shall promptly be reported to the Investor. Such policy shall, at a minimum, (i) require compliance

with all applicable law; (ii) apply to the Company, the Company Subsidiaries and affiliated foundations; (iii) govern (a) the

provision of items of value to any government officials; (b) lobbying and (c) political activities and contributions; and

(iv) provide for (a) internal reporting and oversight and (b) mechanisms for addressing non-compliance with the policy.

4.12 Restrictions on Expenses. Until such time as the Investor ceases to own any Preferred Stock, the Company shall

continue to maintain and implement its comprehensive written policy on corporate expenses and distribute such policy to all

Company employees. Any material amendments to such policy shall require the prior written consent of the Investor until

such time as the Investor no longer owns any Preferred Stock, and any material deviations from such policy, whether in

contravention thereof or pursuant to waivers provided for thereunder, shall promptly be reported to the Investor. Such policy

shall, at a minimum: (i) require compliance with all applicable law; (ii) apply to the Company and the Company Subsidiaries;

(iii) govern (a) the hosting, sponsorship or other payment for conferences and events, (b) the use of corporate aircraft,

(c) travel accommodations and expenditures, (d) consulting arrangements with outside service providers, (e) any new lease or

acquisition of real estate, (f) expenses relating to office or facility renovations or relocations and (g) expenses relating to

entertainment or holiday parties; and (iv) provide for (a) internal reporting and oversight and (b) mechanisms for addressing

non-compliance with the policy.

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4.13 Risk Management Committee. Within 30 days of the Closing Date, and until such time as the Investor ceases to own

any Preferred Stock, the Warrant or any other equity or debt securities of the Company, the Company shall establish and

maintain a risk management committee of the Board of Directors that will oversee the major risks involved in the Company's

business operations and review the Company's actions to mitigate and manage those risks.

4.14 Dividend Rate Adjustment. The dividend rate on the Preferred Stock beneficially owned at the time by the Investor is

subject to adjustment in the sole discretion of the Secretary of the Department of the Treasury in light of, inter alia, thenprevailing economic conditions and the financial condition of the Company, with the objective of protecting the U.S.

taxpayer.

Article 5

Miscellaneous

5.1 Termination. This Agreement may be terminated at any time prior to the Closing:

(a) by either the Investor or the Company if the Closing shall not have occurred by the 30th calendar day following the

Signing Date; provided. however, that in the event the Closing has not occurred by such 30th calendar day, the parties will

consult in good faith to determine whether to extend the term of this Agreement, it being understood that the parties shall be

required to consult only until the fifth day after such 30th calendar day and not be under any obligation to extend the term of

this Agreement thereafter; provided. further, that the right to terminate this Agreement under this Section 5.1 (a) shall not be

available to any party whose breach of any representation or warranty or failure to perform any obligation under this

Agreement shall have caused or resulted in the failure of the Closing to occur on or prior to such date; or

(b) by either the Investor or the Company in the event that any Governmental Entity shall have issued an order, decree or

ruling or taken any other action restraining, enjoining or otherwise prohibiting the transactions contemplated by this

Agreement and such order, decree, ruling or other action shall have become final and nonappealable; or

(c) by the mutual written consent of the Investor and the Company.

In the event of termination of this Agreement as provided in this Section 5.1, this Agreement shall forthwith become void and

there shall be no liability on the part of either party hereto except that nothing herein shall relieve either party from liability

for any breach of this Agreement.

5.2 Survival ofRepresentations and Warranties. All covenants and agreements, other than those which by their terms

apply in whole or in part after the Closing, shall terminate as of the Closing. The representations and warranties of the

Company made herein or in any certificates delivered in connection with the Closing shall survive the Closing without

limitation.

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5.3 Amendment. No amendment of any provision of this Agreement will be effective unless made in writing and signed by

an officer or a duly authorized representative of each party; provided that the Investor may unilaterally amend any provision

of this Agreement to the extent required to comply with any changes after the Signing Date in applicable federal statutes. No

failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall

any single or partial exercise thereof preclude any other or further exercise of any other right, power or privilege. The rights

and remedies herein provided shall be cumulative of any rights or remedies provided by law.

5.4 Waiver ofConditions. The conditions to each party's obligation to consummate the Purchase are for the sole benefit of

such party and may be waived by such party in whole or in part to the extent permitted by applicable law. No waiver will be

effective unless it is in a writing signed by a duly authorized officer of the waiving party that makes express reference to the

provision or provisions subject to such waiver.

5.5 Governing Law: Submission to Jurisdiction. Etc. This Agreement, and the rights and obligations of the parties

hereunder, shall be governed by, and construed and interpreted in accordance with, United States federal law and not the law

of any State. To the extent that a court looks to the laws of any State to determine or define the United States federal law, it is

the intention of the parties hereto that such court shall look only to the laws of the State of New York without regard to the

rules of conflicts of laws. Each of the parties hereto agrees (a) to submit to the exclusive jurisdiction and venue of the United

States District Court for the District of Columbia and the United States Court of Federal Claims for any and all actions, suits

or proceedings arising out of or relating to this Agreement or the Warrant or the transactions contemplated hereby or thereby,

and (b) that notice may be served upon (i) the Company at the address and in the manner set forth for notices to the Company

in Section 5.6 and (ii) the Investor in accordance with federal law. To the extent permitted by applicable law, each of the

parties hereto hereby unconditionally waives trial by jury in any legal action or proceeding relating to this Agreement or the

Warrant or the transactions contemplated hereby or thereby.

5.6 Notices. Any notice, request, instruction or other document to be given hereunder by any party to the other will be in

writing and will be deemed to have been duly given (a) on the date of delivery if delivered personally, or by facsimile, upon

confirmation of receipt, or (b) on the second business day following the date of dispatch if delivered by a recognized next day

courier service. All notices to the Company shall be delivered to the address set forth below, or pursuant to such other

instruction as may be designated in writing by the Company to the Investor. All notices to the Investor shall be delivered as

set forth below, or pursuant to such other instructions as may be designated in writing by the Investor to the Company.

37

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If to the Investor:

United States Department of the Treasury

1500 Pennsylvania Avenue, NW, Room 2312

Washington, D.C. 20220

Attention: Assistant General Counsel (Banking and Finance)

Facsimile: (202) 622-1974

If to the Company:

American International Group, Inc.

70 Pine Street, New York, New York 10270

Attention: General Counsel

Facsimile: (212) 785-2175

Telephone: (212) 770-7000

with a copy to:

Sullivan & Cromwell LLP

125 Broad Street, New York, New York 10004

Attention: Robert W. Reeder Ill, Michael M. Wiseman

Telephone: (212) 558-4000

5.7 Definitions.

(a) When a reference is made in this Agreement to a subsidiary of a person, the term "subsidiary" means any corporation,

partnership, joint venture, limited liability company or other entity (x) of which such person or a subsidiary of such person is

a general partner or (y) of which a majority of the voting securities or other voting interests, or a majority of the securities or

other interests of which having by their terms ordinary voting power to elect a majority of the board of directors or persons

performing similar functions with respect to such entity, is directly or indirectly owned by such person andlor one or more

subsidiaries thereof; provided that no Fund shall be a subsidiary for purposes of this Agreement.

(b) The term "Fund" means any investment vehicle managed by the Company or an Affiliate of the Company and created

in the ordinary course of the Company's asset management business for the purpose of selling Equity Interests in such

investment vehicle to third parties. "Equity Interests" means shares of capital stock, partnership interests, membership

interests in a limited liability company, beneficial interests in a trust or other equity interests in any entity, and any option,

warrant or other right entitling the holder thereof to purchase or otherwise acquire any such equity interest.

(c) The term "Affiliate" means, with respect to any person, any person directly or indirectly controlling, controlled by or

under common control with, such other person. For purposes of this definition, "control" (including, with correlative

meanings, the terms "controlled

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by" and "under common control with") when used with respect to any person, means the possession, directly or indirectly, of

the power to cause the direction of management and/or policies ofsuch person, whether through the ownership of voting

securities by contract or otherwise.

(d) The terms "knowledge of the Company" or "Company's knowledge" mean the actual knowledge after reasonable

and due inquiry of the "officers" (as such term is defined in Rule 3b-2 under the Exchange Act, but excluding any Vice

President or Secretary) of the Company.

5.8 Assignment. Neither this Agreement nor any right, remedy, obligation nor liability arising hereunder or by reason

hereof shall be assignable by any party hereto without the prior written consent of the other party, and any attempt to assign

any right, remedy, obligation or liability hereunder without such consent shall be void, except (a) an assignment, in the case

of a Business Combination, as defined below, where such party is not the surviving entity, or a sale ofsubstantially all of its

assets, to the entity which is the survivor of such Business Combination or the purchaser in such sale and (b) as provided in

Section 4.5. "Business Combination" means merger, consolidation, statutory share exchange or similar transaction that

requires the approval of the Company's stockholders.

5.9 Severability. If any provision of this Agreement or the Warrant, or the application thereof to any person or

circumstance. is determined by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining

provisions hereof, or the application of such provision to persons or circumstances other than those as to which it has been

held invalid or unenforceable, will remain in full force and effect and shall in no way be affected. impaired or invalidated

thereby, so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner

materially adverse to any party. Upon such determination, the parties shall negotiate in good faith in an effort to agree upon a

suitable and equitable substitute provision to effect the original intent of the parties.

5.10 Entire Agreement. This Agreement (including the Annexes and Schedules hereto) constitutes the entire agreement,

and supersedes all other prior agreements. understandings, representations and warranties, both written and oral, between the

parties, with respect to the subject matter hereof.

5.11 No Third Party Beneficiaries. Nothing contained in this Agreement, expressed or implied, is intended to confer upon

any person or entity other than the Company and the Investor any benefit, right or remedies, except that the provisions of

Section 4.5 shall inure to the benefit of the persons referred to in that Section.

[Signature Page Follows]

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In witness whereof, this Agreement has been duly executed and delivered by the duly authorized representatives of the

parties hereto as of the date written below.

AMERICAN INTERNATIONAL GROUP, INC.

By: lsi David L. Herzog

Name: David L. Herzog

Title: Executive Vice President and

Chief Financial Officer

UNITED STATES DEPARTMENT OF THE

TREASURY

By: lsi Neel Kashkari

Name: Neel Kashkari

Title: Interim Assistant Secretary

for Financial Stability

Date: November 25, 2008

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tX-1U.l

ADDITIONAL TERMS AND CONDITIONS

Company Information:

Name of the Company: American International Group, Inc.

Corporate or other organizational form: Corporation

Jurisdiction of Organization: Delaware

Terms of the Purchase:

Series of Preferred Stock Purchased: Series D Fixed Rate Cumulative Perpetual Preferred Stock

Per Share Liquidation Preference of Preferred Stock: $10,000

Number of Shares of Preferred Stock Purchased: 4,000,000

Dividend Payment Dates on the Preferred Stock: February 1, May 1, August 1 and November 1

Number of Warrant Shares: 53,798,766

Exercise Price of the Warrant: Initially $2.50 per share of Common Stock

Closing:

Page 46 of 55

SCHEDULE A

Location of Closing:

Time of Closing:

Date of Closing:

Sullivan & Cromwell LLP

125 Broad Street

New York, NY 10004

3:00 p.m., New York time

November 25,2008

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CAPITALIZATION

Page 47 of 55

SCHEDULEB

Capitalization Date: October 31, 2008

Common Stock

Par value: $2.50 per share

Total Authorized: 5,000,000,000

Outstanding: 2,689,938,313

Subject to warrants, options, convertible securities, etc.: Up to 154,738,080 shares are reserved for issuance pursuant to the

Purchase Contract Agreement between the Company and The Bank of New York, as Purchase Contract Agent, dated as of

May 16,2008

Reserved for benefit plans and other issuances: 169,420,587

Remaining authorized but unissued: 2,310,061,687

Shares issued after Capitalization Date (other than pursuant to warrants, options, convertible securities, etc. as set forth

above): 22,524

Serial Preferred Stock

Par value: $5.00 per share

Total Authorized: 6,000,000

Outstanding (by series): None

Reserved for issuance: 100,000

Remaining authorized but unissued: 5,900,000

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eX-lO.l

LITIGATION

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SCHEDULEC

List any exceptions to the representation and warranty in Section 2.2(1) of the Securities Purchase Agreement.

If none, please so indicate by checking the box: 0.

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EX-lO.l

COMPLIANCE WITH LAWS

Page 49 of 55

SCHEDULED

List any exceptions to the representation and warranty in the second sentence of Section 2.2(m) of the Agreement.

If none, please so indicate by checking the box: It].

List any exceptions to the representation and warranty in the last sentence of Section 2.2(m) of the Securities Purchase

Agreement.

If none, please so indicate by checking the box: ~.

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EX-10.l

REGULATORY AGREEMENTS

List any exceptions to the representation and warranty in Section 2.2(s) of the Agreement.

If none, please so indicate by checking the box: ~.

Page 50 of 55

SCHEDULEE

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EX-1O.1

FORM OF CERTIFICATE OF DESIGNAnONS

[SEE ATTACHED]

Page 51 of 55

ANNEXA

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EX-1O.1

FORM OF WAIVER FOR THE SENIOR EXECUTIVE OFFICERS

AND THE SENIOR PARTNERS

Page 52 of 55

ANNEX B-1

In consideration for the benefits I will receive as a result of the participation of American International Group, Inc.

(together with its subsidiaries and affiliates, the "Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and any other economic stabilization

program implemented by the Department of the Treasury under the Emergency Economic Stabilization Act of 2008 (the

"Act") either prior to or subsequent to the date of this letter from me (any such program, including the Program for

Systemically Significant Failing Institutions, an "EESA Program"), I hereby voluntarily waive any claim against any of the

United States and the Company, the Company's Board of Directors, any individual member ofthe Company's Board of

Directors and the Company's officers, employees, representatives and agents for any changes to my compensation or benefits

that are required to comply with the regulations issued by the Department of the Treasury in connection with an EESA

Program, including without limitation the regulations issued on October 20, 2008, as well as the limitations under the letter

agreement between me and the Company dated November 12, 2008 regarding the term sheet agreement between the

Company and United States Department of the Treasury (the "Limitations").

I acknowledge that the aforementioned regulations and Limitations may require modification of the compensation, bonus,

incentive and other benefit plans, arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in which I may participate as they relate to the

period the United States holds any equity or debt securities of the Company acquired through an EESA Program, including

without limitation the Program for Systemically Significant Failing Institutions, or for any other period applicable under such

EESA Program or Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States or any state related to the requirements

imposed by the aforementioned regulations and Limitations. including without limitation a claim for any compensation or

other payments or benefits I would otherwise receive, any challenge to the process by which the aforementioned regulations

or Limitations are or were adopted and any tort or constitutional claim about the effect of these regulations or Limitations on

my employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this _th day of November, 2008.

Name:

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FORM OF WAIVER FOR THE COMPANY

Page 53 of 55

ANNEXB·2

In consideration for the benefits that it will receive as a result of its participation in the United States Department of the

Treasury's Programs for Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and any other

economic stabilization program implemented by the Department of the Treasury under the Emergency Economic

Stabilization Act of 2008 (the "EESA") either prior to or subsequent to the date of this letter (any such program, including

the Programs for Systemically Significant Failing Institutions, an "EESA Program"), American International Group, Inc.

(together with its subsidiaries and affiliates, the "Company") hereby voluntarily waives any claim against the United States

for any changes to compensation or benefits of the Company's employees that are required to comply with the regulations

issued by the Department of the Treasury in connection with an EESA Program, including without limitation the regulations

issued on October 14,2008 and the requirements of Section 4.10 of the Securities Purchase Agreement dated as of

November 25,2008 between the Company and the United States Department of the Treasury.

The Company acknowledges that the aforementioned regulations and such requirements may require modification of the

compensation, bonus, incentive and other benefit plans, arrangements, policies and agreements (including so-called "golden

parachute" agreements), whether or not in writing, that the Company may have with its employees or in which such

employees may participate as the regulations and such requirements relate to the period the United States holds any equity or

debt securities of the Company acquired through an EESA Program, including without limitation the Programs for

Systemically Significant Failing Institutions Program, or for any other period applicable under such EESA Program.

This waiver includes all claims the Company may have under the laws of the United States or any state related to the

requirements imposed by the aforementioned regulations and such requirements, including without limitation a claim for any

compensation or other payments or benefits the Company's employees would otherwise receive, any challenge to the process

by which the aforementioned regulations are or were adopted and any tort or constitutional claim about the effect of these

regulations on the Company's employment relationship with its employees.

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FORM OF OPINION

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ANNEXC

(a) The Company has been duly incorporated and is an existing corporation in good standing under the laws of the state of

its incorporation.

(b) The Preferred Stock has been duly and validly authorized, and, when issued and delivered pursuant to the Agreement,

the Preferred Stock will be validly issued and fully paid and non-assessable, will not be issued in violation of any preemptive

rights.

(c) The Warrant has been duly authorized and, when executed and delivered as contemplated hereby, will constitute a

valid and legally binding obligation of the Company enforceable against the Company in accordance with its terms, except as

the same may be limited by applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or similar

laws affecting the creditors' rights and general equitable principles, regardless of whether such enforceability is considered in

a proceeding at law or in equity.

(d) The shares of Common Stock issuable upon exercise of the Warrant have been duly authorized and reserved for

issuance upon exercise of the Warrant and when so issued in accordance with the terms of the Warrant will be validly issued,

fully paid and non-assessable.

(e) The Company has the corporate power and authority to execute and deliver the Agreement and the Warrant to carry

out its obligations thereunder (which includes the issuance of the Preferred Stock, Warrant and Warrant Shares).

(f) The execution, delivery and performance by the Company of the Agreement and the Warrant and the consummation of

the transactions contemplated thereby have been duly authorized by all necessary corporate action on the part of the

Company and its stockholders, and no further approval or authorization is required on the part of the Company, other than the

vote of the stockholders described in Section 3.I(b) of the Agreement.

(g) The Agreement is a valid and binding obligation of the Company enforceable against the Company in accordance with

its terms, except as the same may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar

laws affecting the creditors' rights and general equitable principles, regardless of whether such enforceability is considered in

a proceeding at law or in equity; provided. however, such counsel need express no opinion with respect to Section 3.I(b) or

Section 4.5(g) or the severability provisions of the Agreement insofar as Section 3.I(b) or Section 4.5(g)is concerned.

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EX-lO.l

FORM OF WARRANT

[SEE AITACHED]

Page 55 of 55

ANNEXD

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EX-10.2

EX-10.2 4 y72888exv10w2.htm EX-10.2: WARRANT

t'age 1 or 10

Exhibit 10.2

WARRANT TO PURCHASE COMMON STOCK

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE

SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE

TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION STATEMENT

RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR

PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS. THIS

INSTRUMENT IS ISSUED SUBJECT TO THE RESTRICTIONS ON TRANSFER AND OTHER PROVISIONS OF A

SECURITIES PURCHASE AGREEMENT BETWEEN THE ISSUER OF THESE SECURITIES AND THE INVESTOR

REFERRED TO THEREIN, A COPY OF WHICH IS ON FILE WITH THE ISSUER. THE SECURITIES REPRESENTED

BY THIS INSTRUMENT MAY NOT BE SOLD OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH

SAID AGREEMENT. ANY SALE OR OTHER TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENT WILL

BE VOID.

WARRANT

to purchase

53,798,766

Shares of Common Stock

of AMERICAN INTERNATIONAL GROUP, INC.

Issue Date: November 25,2008

I. Definitions. Unless the context otherwise requires, when used herein the following terms shall have the meanings

indicated.

"Affiliate" has the mf;aning ascribed to it in the Purchase Agreement.

"Appraisal Procedure" means a procedure whereby two independent appraisers, one chosen by the Company and one by

the Original Warrantholder, shall mutually agree upon the determinations then the subject of appraisal. Each party shall

deliver a notice to the other appointing its appraiser within 15 days after the Appraisal Procedure is invoked. If within

30 days after appointment of the two appraisers they are unable to agree upon the amount in question, a third independent

appraiser shall be chosen within 10 days thereafter by the mutual consent of such first two appraisers. The decision of the

third appraiser so appointed and chosen shall be given within 30 days after the selection of such third appraiser. If three

appraisers shall be appointed and the determination of one appraiser is disparate from the middle determination by more than

twice the amount by which the other determination is disparate from the middle determination, then the determination of such

appraiser shall be excluded, the

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remaining two determinations shall be averaged and such average shall be binding and conclusive upon the Company and the

Original Warrantholder; otherwise, the average of all three determinations shall be binding upon the Company and the

Original Warrantholder. The costs of conducting any Appraisal Procedure shall be borne by the Company.

"Board ofDirectors" means the board of directors of the Company, including any duly authorized committee thereof.

"Business Combination" means a merger, consolidation, statutory share exchange or similar transaction that requires the

approval of the Company's stockholders.

"business day" means any day except Saturday, Sunday and any day on which banking institutions in the State of New

York generally are authorized or required by law or other governmental actions to close.

"Capital Stock" means (A) with respect to any Person that is a corporation or company, any and all shares, interests,

participations or other equivalents (however designated) of capital or capital stock of such Person and (B) with respect to any

Person that is not a corporation or company, any and all partnership or other equity interests of such Person.

"Charter" means, with respect to any Person, its certificate or articles of incorporation, articles of association, or similar

organizational document.

"Charter Amendment" means the amendments to the Company's Restated Certificate of Incorporation to reduce the par

value of the Common Stock to $0.00000 I per share and increase the number of authorized shares of Common Stock to

19 billion.

"Common Stock" has the meaning ascribed to it in the Purchase Agreement.

"Company" means the American International Group, Inc.

"conversion" has the meaning set forth in Section l3(C).

"convertible securities" has the meaning set forth in Sec.tion l3(C).

"Exchange Act" means the Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and

regulations promulgated thereunder.

"Exercise Price" means, with respect to this Warrant, initially, $2.50, and upon the effectiveness of the Charter

Amendment, the amended par value per share of Common Stock.

2

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"Expiration Time" has the meaning set forth in Section 3.

"Fair Market Value" means, with respect to any security or other property, the fair market value of such security or other

property as determined by the Board of Directors, acting in good faith or, with respect to Section 14, as determined by the

Original Warrantholder acting in good faith. For so long as the Original Warrantholder holds this Warrant or any portion

thereof, it may object in writing to the Board of Director's calculation of fair market value within 10 days of receipt of

written notice thereof. If the Original Warrantholder and the Company are unable to agree on fair market value during the 10-

day period following the delivery of the Original Warrantholder's objection, the Appraisal Procedure may be invoked by

either party to determine Fair Market Value by delivering written notification thereof not later than the 30th day after delivery

of the Original Warrantholder's objection.

"Governmental Entities" has the meaning ascribed to it in the Purchase Agreement.

"Initial Number" has the meaning set forth in Section 13(C).

"Issue Date" means November 25, 2008.

"Market Price" means, with respect to a particular security, on any given day, the last reported sale price regular way or,

in case no such reported sale takes place on such day, the average of the last closing bid and ask prices regular way, in either

case on the principal national securities exchange on which the applicable securities are listed or admitted to trading, or if not

listed or admitted to trading on any national securities exchange, the average of the closing bid and ask prices as furnished by

two members of the Financial Industry Regulatory Authority, Inc. selected from time to time by the Company for that

purpose. "Market Price" shall be determined without reference to after hours or extended hours trading. If such security is not

listed and traded in a manner that the quotations referred to above are available for the period required hereunder, the Market

Price per share of Common Stock shall be deemed to be (i) in the event that any portion of the Warrant is held by the

Original Warrantholder, the fair market value per share of such security as determined in good faith by the Original

Warrantholder or (ii) in all other circumstances, the fair market value per share ofsuch security as determined in good faith

by the Board of Directors in reliance on an opinion of a nationally recognized independent investment banking corporation

retained by the Company for this purpose and certified in a resolution to the Warrantholder. For the purposes of determining

the Market Price of the Common Stock on the "trading day" preceding, on or following the occurrence of an event, (i) that

trading day shall be deemed to commence immediately after the regular scheduled closing time of trading on the New York

Stock Exchange or, if trading is closed at an earlier time, such earlier time and (ii) that trading day shall

3

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end at the next regular scheduled closing time, or if trading is closed at an earlier time, such earlier time (for the avoidance of

doubt, and as an example, if the Market Price is to be determined as of the last trading day preceding a specified event and

the closing time of trading on a particular day is 4:00 p.m. and the specified event occurs at 5:00 p.m. on that day, the Market

Price would be determined by reference to such 4:00 p.m. closing price).

"Original Warrantholder" means the United States Department of the Treasury. Any actions specified to be taken by the

Original Warrantholder hereunder may only be taken by such Person and not by any other Warrantholder.

"Permitted Transactions" has the meaning set forth in Section l3(C).

"Person" has the meaning given to it in Section 3(a)(9) of the Exchange Act and as used in Sections l3(d)(3) and 14(d)(2)

of the Exchange Act.

"Per Share Fair Market Value" has the meaning set forth in Section l3(D).

"Preferred Shares" means the perpetual preferred stock issued to the Original Warrantholder on the Issue Date pursuant to

the Purchase Agreement.

"Pro Rata Repurchases" means any purchase of shares of Common Stock by the Company or any subsidiary thereof

pursuant to (A) any tender offer or exchange offer subject to Section 13(e) or l4(e) of the Exchange Act or Regulation 14E

promulgated thereunder or (B) any other offer available to substantially all holders of Common Stock, in the case of both

(A) or (B), whether for cash, shares of Capital Stock of the Company, other securities ofthe Company, evidences of

indebtedness of the Company or any other Person or any other property (including, without limitation, shares of Capital

Stock, other securities or evidences of indebtedness of a subsidiary), or any combination thereof, effected while this Warrant

is outstanding. The "Effective Date" of a Pro Rata Repurchase shall mean the date of acceptance of shares for purchase or

exchange by the Company under any tender or exchange offer which is a Pro Rata Repurchase or the date of purchase with

respect to any Pro Rata Repurchase that is not a tender or exchange offer.

"Purchase Agreement" means the Securities Purchase Agreement, dated as of November 25, 2008, as amended from time

to time, between the Company and the United States Department of the Treasury, including all annexes and schedules

thereto.

"Regulatory Approvals" with respect to the Warrantholder, means, to the extent applicable and required to permit the

Warrantholder to exercise this Warrant for shares of Common Stock and to own such Common Stock without the

Warrantholder being in violation of applicable law, rule or regulation, the

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receipt of any necessary approvals and authorizations of, filings and registrations with, notifications to, or expiration or

tennination of any applicable waiting period under, the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended,

and the rules and regulations thereunder.

"SEC' means the U.S. Securities and Exchange Commission.

"Securities Act" means the Securities Act of 1933, as amended, or any successor statute, and the rules and regUlations

promulgated thereunder.

"Shares" has the meaning set forth in Section 2.

"trading day" means (A) if the shares of Common Stock are not traded on any national or regional securities exchange or

association or over-the-counter market, a business day or (B) if the shares of Common Stock are traded on any national or

regional securities exchange or association or over-the-counter market, a business day on which such relevant exchange or

quotation system is scheduled to be open for business and on which the shares of Common Stock (i) are not suspended from

trading on any national or regional securities exchange or association or over-the-counter market for any period or periods

aggregating one half hour or longer; and (ii) have traded at least once on the national or regional securities exchange or

association or over-the-counter market that is the primary market for the trading of the shares of Common Stock.

"U.s. GAAP" means United States generally accepted accounting principles.

"Warrantholder" has the meaning set forth in Section 2.

"Warrant" means this Warrant, issued pursuant to the Purchase Agreement.

2. Number of Shares; Exercise Price. This certifies that, for value received, the United States Department of the Treasury

or its pennitted assigns (the "Warrantholder") is entitled, upon the terms and subject to the conditions hereinafter set forth, to

acquire from the Company, in Whole or in part, after the receipt of all applicable Regulatory Approvals, if any, up to an

aggregate of 53,798,766 fully paid and nonassessable shares of Common StOCk, at a purchase price per share of Common

Stock equal to the Exercise Price. The number of shares of Common Stock (the "Shares") and the Exercise Price are subject

to adjustment as provided herein, and all references to "Common Stock," "Shares" and "Exercise Price" herein shall be

deemed to include any such adjustment or series of adjustments.

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3. Exercise of Warrant; Term. Subject to Section 2, to the extent permitted by applicable laws and regulations, the right to

purchase the Shares represented by this Warrant is exercisable, in whole or in part by the Warrantholder, at any time or from

time to time after the execution and delivery of this Warrant by the Company on the date hereof, but in no event later than

5:00 p.m., New York City time on the tenth anniversary of the Issue Date (the "Expiration Time"), by (A) the surrender of

this Warrant and Notice of Exercise annexed hereto, duly completed and executed on behalf of the Warrantholder, at the

principal executive office of the Company located at 70 Pine Street, New York, New York 10270 Attention: Chief Financial

Officer (or such other office or agency ofthe Company in the United States as it may designate by notice in writing to the

Warrantholder at the address of the Warrantholder appearing on the books of the Company), and (B) payment of the Exercise

Price for the Shares thereby purchased:

(i) by having the Company withhold, from the shares of Common Stock that would otherwise be delivered to the

Warrantholder upon such exercise, shares of Common Stock issuable upon exercise of the Warrant equal in value to the

aggregate Exercise Price as to which this Warrant is so exercised based on the Market Price of the Common Stock on the

trading day on which this Warrant is exercised and the Notice of Exercise is delivered to the Company pursuant to this

Section 3, or

(ii) with the consent of both the Company and the Warrantholder, by tendering in cash, by certified or cashier's check

payable to the order of the Company, or by wire transfer of immediately available funds to an account designated by the

Company.

If the Warrantholder does not exercise this Warrant in its entirety, the Warrantholder will be entitled to receive from the

Company within a reasonable time, and in any event not exceeding three business days, a new warrant in substantially

identical form for the purchase of that number of Shares equal to the difference between the number of Shares subject to this

Warrant and the number of Shares as to which this Warrant is so exercised. Notwithstanding anything in this Warrant to the

contrary, the Warrantholder hereby acknowledges and agrees that its exercise of this Warrant for Shares is subject to the

condition that the Warrantholder will have first received any applicable Regulatory Approvals.

4. Issuance of Shares; Authorization; Listing. Book-entries representing Shares issued upon exercise of this Warrant will

be promptly recorded in such name or names as the Warrantholder may designate. The Company hereby represents and

warrants that any Shares issued upon the exercise of this Warrant in accordance with the provisions of Section 3 will be duly

and validly authorized and issued, fully paid and nonassessable and free from all taxes, liens and charges (other than liens or

charges created by the Warrantholder,

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income and franchise taxes incurred in connection with the exercise of the Warrant or taxes in respect of any transfer

occurring contemporaneously therewith). The Company agrees that the Shares so issued will be deemed to have been issued

to the Warrantholder as of the close of business on the date on which this Warrant and payment of the Exercise Price are

delivered to the Company in accordance with the terms of this Warrant, notwithstanding that the stock transfer books of the

Company may then be closed. The Company will at all times reserve and keep available, out of its authorized but unissued

Common Stock, solely for the purpose of providing for the exercise ofthis Warrant, the aggregate number of shares of

Common Stock then issuable upon exercise of this Warrant at any time. The Company will (A) procure, at its sole expense,

the listing of the Shares issuable upon exercise of this Warrant at any time, subject to issuance or notice of issuance, on all

principal stock exchanges on which the Common Stock is then listed or traded and (B) maintain such listings of such Shares

at all times after issuance. The Company will use reasonable best efforts to ensure that the Shares may be issued without

violation of any applicable law or regulation or of any requirement of any securities exchange on which the Shares are listed

or traded.

5. No Fractional Shares or Scrip. No fractional Shares or scrip representing fractional Shares shall be issued upon any

exercise of this Warrant. In lieu of any fractional Share to which the Warrantholder would otherwise be entitled, the

Warrantholder shall be entitled to receive a cash payment equal to the Market Price of the Common Stock on the last trading

day preceding the date of exercise less the pro-rated Exercise Price for such fractional share.

6. No Rights as Stockholders: Transfer Books. This Warrant does not entitle the Warrantholder to any voting rights or

other rights as a stockholder of the Company prior to the date of exercise hereof. The Company will at no time close its

transfer books against transfer of this Warrant in any manner which interferes with the timely exercise of this Warrant.

7. Charges. Taxes and Expenses. Issuance of Shares to the Warrantholder upon the exercise of this Warrant shall be made

without charge to the Warrantholder for any issue or transfer tax or other incidental expense in respect of the issuance of such

Shares, all of which taxes and expenses shall be paid by the Company.

8. Transfer/Assignment.

(A) Subject to compliance with clause (B) of this Section 8, this Warrant and all rights hereunder are transferable, in

whole or in part, upon the books of the Company by the registered holder hereof in person or by duly authorized attorney,

and a new warrant shall be made and delivered by the Company, of the same tenor and date as this Warrant but registered in

the name of one or more transferees, upon surrender of this Warrant, duly endorsed, to the

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office or agency of the Company described in Section 3. All expenses (other than stock transfer taxes) and other charges

payable in connection with the preparation, execution and delivery of the new warrants pursuant to this Section 8 shall be

paid by the Company.

(B) The transfer of the Warrant and the Shares issued upon exercise of the Warrant are subject to the restrictions set forth

in Section 4.4 of the Purchase Agreement. If and for so long as required by the Purchase Agreement, this Warrant shall

contain the legends as set forth in Section 4.2(a) of the Purchase Agreement.

9. Exchange and Registry of Warrant. This Warrant is exchangeable, upon the surrender hereof by the Warrantholder to

the Company, for a new warrant or warrants of like tenor and representing the right to purchase the same aggregate number

of Shares. The Company shall maintain a registry showing the name and address of the Warrantholder as the registered

holder of this Warrant. This Warrant may be surrendered for exchange or exercise in accordance with its terms, at the office

of the Company, and the Company shall be entitled to rely in all respects, prior to written notice to the contrary, upon such

registry.

10. Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by the Company of evidence reasonably satisfactory

to it of the loss, theft, destruction or mutilation of this Warrant, and in the case of any such loss, theft or destruction, upon

receipt of a bond, indemnity or security reasonably satisfactory to the Company, or, in the case of any such mutilation, upon

surrender and cancellation of this Warrant, the Company shall make and deliver, in lieu of such lost, stolen, destroyed or

mutilated Warrant, a new Warrant of like tenor and representing the right to purchase the same aggregate number of Shares

as provided for in such lost, stolen, destroyed or mutilated Warrant.

II. Saturdays, Sundays. Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any

right required or granted herein shall not be a business day, then such action may be taken or such right may be exercised on

the next succeeding day that is a business day.

12. Rule 144 Information. The Company covenants that it will use its reasonable best efforts to timely file all reports and

other documents required to be filed by it under the Securities Act and the Exchange Act and the rules and regulations

promulgated by the SEC thereunder (or, if the Company is not required to file such reports, it will, upon the request of any

Warrantholder, make publicly available such information as necessary to permit sales pursuant to Rule 144 under the

Securities Act), and it will use reasonable best efforts to take such further action as any Warrantholder may reasonably

request, in each case to the extent required from time to time to enable such holder to, if permitted by the terms of this

Warrant and the Purchase Agreement, sell this Warrant without

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registration under the Securities Act within the limitation of the exemptions provided by (A) Rule 144 under the Securities

Act, as such rule may be amended from time to time, or (B) any successor rule or regulation hereafter adopted by the SEC.

Upon the written request of any Warrantholder, the Company will deliver to such Warrantholder a written statement that it

has complied with such requirements.

13. Adjustments and Other Rights. The Exercise Price and the number of Shares issuable upon exercise of this Warrant

shall be subject to adjustment from time to time as follows; provided, that if more than one subsection of this Section 13 is

applicable to a single event, the subsection shall be applied that produces the largest adjustment and no single event shall

cause an adjustment under more than one subsection of this Section 13 so as to result in duplication:

(A) Charter Amendment. Upon the effectiveness of the Charter Amendment, the Exercise Price shall be adjusted from its

initial value of $2.50 to the amended par value per share of Common Stock.

(B) Stock Splits. Subdivisions. Reclassifications or Combinations. If the Company shall (i) declare and pay a dividend or

make a distribution on its Common Stock in shares of Common Stock, (ii) subdivide or reclassify the outstanding shares of

Common Stock into a greater number of shares, or (iii) combine or reclassify the outstanding shares of Common Stock into a

smaller number of shares, the number of Shares issuable upon exercise of this Warrant at the time of the record date for such

dividend or distribution or the effective date of such subdivision, combination or reclassification shall be proportionately

adjusted so that the Warrantholder after such date shall be entitled to purchase the number of shares of Common Stock which

such holder would have owned or been entitled to receive in respect of the shares of Common Stock subject to this Warrant

after such date had this Warrant been exercised immediately prior to such date. In such event, the Exercise Price in effect at

the time of the record date for such dividend or distribution or the effective date of such subdivision, combination or

reclassification shall be adjusted to the number obtained by dividing (x) the product of (1) the number of Shares issuable

upon the exercise of this Warrant before such adjustment and (2) the Exercise Price in effect immediately prior to the record

or effective date, as the case may be, for the dividend, distribution, subdivision, combination or reclassification giving rise to

this adjustment by (y) the new number of Shares issuable upon exercise of the Warrant determined pursuant to the

immediately preceding sentence.

(C) Certain Issuances of Common Shares or Convertible Securities. Until the earlier of (i) the date on which the Original

Warrantholder no longer holds this Warrant or any portion thereof and (ii) the third anniversary of the Issue Date, if the

Company shall issue shares of Common Stock (or rights or warrants or other securities exercisable or convertible into or

exchangeable (collectively, a

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"conversion") for shares of Common Stock) (collectively, "convertible securities") (other than in Permitted Transactions (as

defined below) or a transaction to which subsection (B) of this Section 13 is applicable) without consideration or at a

consideration per share (or having a conversion price per share) that is less than 90% of the Market Price on the last trading

day preceding the date of the agreement on pricing such shares (or such convertible securities) then, in such event:

(A) the number of Shares issuable upon the exercise of this Warrant immediately prior to the date of the agreement on

pricing of such shares (or of such convertible securities) (the "Initial Number") shall be increased to the number obtained

by multiplying the Initial Number by a fraction (A) the numerator of which shall be the sum of (x) the number of shares of

Common Stock of the Company outstanding on such date and (y) the number of additional shares of Common Stock

issued (or into which convertible securities may be exercised or convert) and (B) the denominator of which shall be the

sum of (I) the number of shares of Common Stock outstanding on such date and (II) the number of shares ofCommon

Stock which the aggregate consideration receivable by the Company for the total number ofshares of Common Stock so

issued (or into which convertible securities may be exercised or convert) would purchase at the Market Price on the last

trading day preceding the date of the agreement on pricing such shares (or such convertible securities); and

(B) the Exercise Price payable upon exercise of the Warrant shall be adjusted by multiplying such Exercise Price in effect

immediately prior to the date of the agreement on pricing of such shares (or of such convertible securities) by a fraction,

the numerator of which shall be the number of shares of Common Stock issuable upon exercise of this Warrant prior to

such date and the denominator of which shall be the number ofshares of Common Stock issuable upon exercise of this

Warrant immediately after the adjustment described in clause (A) above.

For purposes of the foregoing, the aggregate consideration receivable by the Company in connection with the issuance of

such shares of Common Stock or convertible securities shall be deemed to be equal to the sum ofthe net offering price

(including the Fair Market Value of any non-cash consideration and after deduction of any related expenses payable to third

parties) of all such securities plus the minimum aggregate amount, if any, payable upon exercise or conversion of any such

convertible securities into shares of Common Stock; and "Permitted Transactions" shall mean issuances (i) as consideration

for or to fund the acquisition of businesses and/or related assets, (ii) in connection with employee benefit plans and

compensation related arrangements in the ordinary course and consistent with past practice approved by the Board of

Directors, (iii) in connection with a public or broadly marketed offering and sale of Common Stock

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or convertible securities for cash conducted by the Company or its affiliates pursuant to registration under the Securities Act

or Rule 144A thereunder on a basis consistent with capital raising transactions by comparable financial institutions and (iv) in

connection with the exercise of preemptive rights on terms existing as of the Issue Date. Any adjustment made pursuant to

this Section 13(C) shall become effective immediately upon the date of such issuance.

(D) Other Distributions. In case the Company shall fix a record date for the making of a distribution to all holders of

shares of its Common' Stock of securities, evidences of indebtedness, assets, cash, rights or warrants (excluding dividends of

its Common Stock and other dividends or distributions referred to in Section 13(B)), in each such case, the Exercise Price in

effect prior to such record date shall be reduced immediately thereafter to the price determined by multiplying the Exercise

Price in effect immediately prior to the reduction by the quotient of (x) the Market Price of the Common Stock on the last

trading day preceding the first date on which the Common Stock trades regular way on the principal national securities

exchange on which the Common Stock is listed or admitted to trading without the right to receive such distribution, minus

the amount of cash and/or the Fair Market Value of the securities, evidences of indebtedness, assets, rights or warrants to be

so distributed in respect of one share of Common Stock (such amount and/or Fair Market Value, the "Per Share Fair Market

Value") divided by (y) such Market Price on such date specified in clause (x); such adjustment shall be made successively

whenever such a record date is fixed. In such event, the number of Shares issuable upon the exercise of this Warrant shall be

increased to the number obtained by dividing (x) the product of (1) the number of Shares issuable upon the exercise of this

Warrant before such adjustment, and (2) the Exercise Price in effect immediately prior to the distribution giving rise to this

adjustment by (y) the new Exercise Price determined in accordance with the immediately preceding sentence. In the event

that such distribution is not so made, the Exercise Price and the number of Shares issuable upon exercise of this Warrant then

in effect shall be readjusted, effective as of the date when the Board of Directors determines not to distribute such shares,

evidences of indebtedness, assets, rights, cash or warrants, as the case may be, to the Exercise Price that would then be in

effect and the number of Shares that would then be issuable upon exercise of this Warrant if such record date had not been

fixed.

(E) Certain Repurchases of Common Stock. In case the Company effects a Pro Rata Repurchase of Common Stock, then

the Exercise Price shall be reduced to the price determined by multiplying the Exercise Price in effect immediately prior to

the Effective Date of such Pro Rata Repurchase by a fraction of which the numerator shall be (i) the product of (x) the

number of shares of Common Stock outstanding immediately before such Pro Rata Repurchase and (y) the Market Price of a

share of Common Stock on the trading day immediately preceding the first public announcement by the Company or any of

its Affiliates

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of the intent to effect such Pro Rata Repurchase, minus (ii) the aggregate purchase price of the Pro Rata Repurchase, and of

which the denominator shall be the product of (i) the number of shares of Common Stock outstanding immediately prior to

such Pro Rata Repurchase minus the number of shares of Common Stock so repurchased and (ii) the Market Price per share

of Common Stock on the trading day immediately preceding the fIrst public announcement by the Company or any of its

Affiliates of the intent to effect such Pro Rata Repurchase. In such event, the number of shares of Common Stock issuable

upon the exercise of this Warrant shall be increased to the number obtained by dividing (x) the product of (1) the number of

Shares issuable upon the exercise of this Warrant before such adjustment, and (2) the Exercise Price in effect immediately

prior to the Pro Rata Repurchase giving rise to this adjustment by (y) the new Exercise Price determined in accordance with

the immediately preceding sentence. For the avoidance of doubt, no increase to the Exercise Price or decrease in the number

of Shares issuable upon exercise of this Warrant shall be made pursuant to this Section l3(E).

(F) Business Combinations. In case of any Business Combination or reclassifIcation of Common Stock (other than a

reclassification of Common Stock referred to in Section l3(B», the Warrantholder's right to receive Shares upon exercise of

this Warrant shall be converted into the right to exercise this Warrant to acquire the number of shares of stock or other

securities or property (including cash) which the Common Stock issuable (at the time ofsuch Business Combination or

reclassification) upon exercise of this Warrant immediately prior to such Business Combination or reclassifIcation would

have been entitled to receive upon consummation of such Business Combination or reclassifIcation; and in any such case, if

necessary, the provisions set forth herein with respect to the rights and interests thereafter of the Warrantholder shall be

appropriately adjusted so as to be applicable, as nearly as may reasonably be, to the Warrantholder's right to exercise this

Warrant in exchange for any shares of stock or other securities or property pursuant to this paragraph. In determining the kind

and amount of stock, securities or the property receivable upon exercise of this Warrant following the consummation of such

Business Combination, if the holders of Common Stock have the right to elect the kind or amount of consideration receivable

upon consummation of such Business Combination,. then the consideration that the Warrantholder shall be entitled to receive

upon exercise shall be deemed to be the types and amounts of consideration received by the majority of all holders of the

shares of Common Stock that affirmatively make an election (or of all such holders if none make an election).

(G) Rounding of Calculations; Minimum Adjustments. All calculations under this Section 13 shall be made to the nearest

one-tenth (lIlOth) of a cent or to the nearest one-hundredth (l/lOOth) of a share, as the case may be. Any provision of this

Section 13 to the contrary notwithstanding, no adjustment in the Exercise Price or the number of Shares into which this

Warrant is exercisable

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shall be made if the amount of such adjustment would be less than $0.01 or one-tenth (1/ lOth) of a share of Common Stock,

but any such amount shall be carried forward and an adjustment with respect thereto shall be made at the time of and together

with any subsequent adjustment which, together with such amount and any other amount or amounts so carried forward, shall

aggregate $0.01 or l/lOth of a share of Common Stock, or more.

(H) Timing of Issuance of Additional Common Stock Upon Certain Adjustments. In any case in which the provisions of

this Section 13 shall require that an adjustment shall become effective immediately after a record date for an event, the

Company may defer until the occurrence ofsuch event (i) issuing to the Warrantholder of this Warrant exercised after such

record date and before the occurrence of such event the additional shares of Common Stock issuable upon such exercise by

reaSOn of the adjustment required by such event over and above the shares ofCommon Stock issuable upon such exercise

before giving effect to such adjustment and (ii) paying to such Warrantholder any amount of cash in lieu of a fractional share

of Common Stock; provided, however, that the Company upon request shall deliver to such Warrantholder a due bill or other

appropriate instrument evidencing such Warrantholder's right to receive such additional shares, and such cash, upon the

occurrence of the event requiring such adjustment.

(I) Other Events. For so long as the Original Warrantholder holds this Warrant or any portion thereof, if any event occurs

as to which the provisions of this Section 13 are not strictly applicable or, if strictly applicable, would not, in the good faith

judgment of the Board of Directors of the Company, fairly and adequately protect the purchase rights of the Warrants in

accordance with the essential intent and principles of such provisions, then the Board of Directors shall make such

adjustments in the application of such provisions, in accordance with such essential intent and principles, as shall be

reasonably necessary, in the good faith opinion of the Board of Directors, to protect such purchase rights as aforesaid. The

Exercise Price and the number of Shares into which this Warrant is exercisable shall not be adjusted in the event of a change

in the par value of the Common Stock (other than pursuant to the Charter Amendment) or a change in the jurisdiction of

incorporation of the Company.

(J) Statement Regarding Adjustments. Whenever the Exercise Price or the number of Shares into which this Warrant is

exercisable shall be adjusted as provided in Section 13, the Company shall forthwith file at the principal office of the

Company a statement showing in reasonable detail the facts requiring such adjustment and the Exercise Price that shall be in

effect and the number of Shares into which this Warrant shall be exercisable after such adjustment, and the Company shall

also cause a copy of such statement to be sent by mail, first class postage prepaid, to each Warrantholder at the address

appearing in the Company's records.

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(K) Notice of Adjustment Event. In the event that the Company shall propose to take any action of the type described in

this Section 13 (but only if the action of the type described in this Section 13 would result in an adjustment in the Exercise

Price or the number of Shares into which this Warrant is exercisable or a change in the type of securities or property to be

delivered upon exercise of this Warrant), the Company shall give notice to the Warrantholder, in the manner set forth in

Section 13(1), which notice shall specify the record date, if any, with respect to any such action and the approximate date on

which such action is to take place. Such notice shall also set forth the facts with respect thereto as shall be reaSonably

necessary to indicate the effect on the Exercise Price and the number. kind or class of shares or other securities or property

which shall be deliverable upon exercise of this Warrant. In the case of any action which would require the fixing of a record

date. such notice shall be given at least 10 days prior to the date so fixed. and in case of all other action. such notice shall be

given at least 15 days prior to the taking of such proposed action. Failure to give such notice, or any defect therein. shall not

affect the legality or validity of any such action.

(L) Proceedings Prior to Any Action Requiring Adjustment. As a condition precedent to the taking of any action which

would require an adjustment pursuant to this Section 13, the Company shall take any action which may be necessary,

including obtaining regulatory, New York Stock Exchange or stockholder approvals or exemptions. in order that the

Company may thereafter validly and legally issue as fully paid and nonassessable all shares of Common Stock that the

Warrantholder is entitled to receive upon exercise of this Warrant pursuant to this Section 13.

(M) Adjustment Rules. Any adjustments pursuant to this Section 13 shall be made successively whenever an event

referred to herein shaH occur. If an adjustment in Exercise Price made hereunder would reduce the Exercise Price to an

amount below par value of the Common Stock, then such adjustment in Exercise Price made hereunder shall reduce the

Exercise Price to the par value of the Common Stock.

14. Exchange. At any time following the date on which the shares of Common Stock of the Company are no longer listed

or admitted to trading on a national securities exchange (other than in connection with any Business Combination), the

Original Warrantholder may cause the Company to exchange all or a portion of this Warrant for an economic interest (to be

determined by the Original Warrantholder after consultation with the Company) of the Company classified as permanent

equity under U.S. GAAP having a value equal to the Fair Market Value of the portion of the Warrant so exchanged. The

Original Warrantholder shall calculate any Fair Market Value required to be calculated pursuant to this Section 14. which

shall not be subject to the Appraisal Procedure.

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15. No Impairment. The Company will not, by amendment of its Charter or through any reorganization, transfer of assets,

consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the

observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all times

in good faith assist in the carrying out of all the provisions of this Warrant and in taking of all such action as may be

necessary or appropriate in order to protect the rights of the Warrantholder.

16. Governing Law. This Warrant, and the rights and obligations of the parties hereunder, shall be governed by,

and construed and interpreted in accordance with, United States federal law and not the law of any State. To the

extent that a court looks to the laws of any State to determine or define the United States federal law, it is the intention

of the parties hereto that such court shall look only to the laws of the State of New York without regard to the rules of

conflicts of laws. Each of the Company and the Warrantholder agrees (a) to submit to the exclusive jurisdiction and

venue of the United States District Court for the District of Columbia for any action, suit or proceeding arising out of

or relating to this Warrant or the transactions contemplated hereby, and (b) that notice may be served upon the

Company at the address in Section 20 below and upon the Warrantholder at the address for the Warrantholder set

forth in the registry maintained by the Company pursuant to Section 9 hereof. To the extent permitted by applicable

law, each ofthe Company and the Warrantholder hereby unconditionally waives trial by jury in any legal action or

proceeding relating to the Warrant or the transactions contemplated hereby or thereby.

17. Binding Effect. This Warrant shall be binding upon any successors or assigns of the Company.

18. Amendments. This Warrant may be amended and the observance of any term of this Warrant may be waived only with

the written consent of the Company and the Warrantholder.

19. Prohibited Actions. The Company agrees that it will not take any action which would entitle the Warrantholder to an

adjustment of the Exercise Price if the total number of shares of Common Stock issuable after such action upon exercise of

this Warrant, together with all shares of Common Stock then outstanding and all shares of Common Stock then issuable upon

the exercise of all outstanding options, warrants, conversion and other rights, would exceed the total number of shares of

Common Stock then authorized by its Charter.

20. Notices. Any notice, request, instruction or other document to be given hereunder by any party to the other will be in

writing and will be deemed to have been duly given (a) on the date of delivery if delivered personally, or by

15

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EX-1O.2 Page 16 of 18

facsimile, upon confirmation of receipt, or (b) on the second business day following the date of dispatch if delivered by a

recognized next day courier service. All notices hereunder shall be delivered as set forth below, or pursuant to such other

instructions as may be designated in writing by the party to receive such notice.

If to the Company:

American International Group, Inc.

70 Pine Street

New York, New York 10270

Attention: Chief Financial Officer:

Secretary:

Treasurer:

with a copy to:

Sullivan & Cromwell LLP

125 Broad Street

New York, NY 10004

Attention Robert W. Reeder, III

Michael M. Wiseman

If to the Warrantholder:

United States Department of the Treasury

1500 Pennsylvania Avenue, NW, Room 2312

Washington, D.C. 20220

Attention: Assistant General Counsel (Banking and Finance)

Facsimile: (202) 622-1974

with a copy to:

Davis Polk & Wardwell

450 Lexington Avenue

New York, NY 10017

Attention: John Brandow

21. Entire Agreement. This Warrant contains the entire agreement between the parties with respect to the subject matter

hereof and supersede all prior and contemporaneous arrangements or undertakings with respect thereto.

[Remainder ofpage intentionally left blank}

16

http://www.sec.gov/Archives/edgar/data/5272/000095012308016447/y72888exvl0w2.htm 12/1/2008
EX-1O.2

TO: American International Group, Inc.

[Form of Notice of Exercise]

Date: _

Page 17 of 18

RE: Election to Purchase Common Stock

The undersigned, pursuant to the provisions set forth in the attached Warrant, hereby agrees to subscribe for and purchase

the number of shares of the Common Stock set forth below covered by such Warrant. The undersigned, in accordance with

Section 3 of the Warrant, hereby agrees to pay the aggregate Exercise Price for such shares of Common Stock in the manner

setforth below. A new warrant evidencing the remaining shares of Common Stock covered by such Warrant, but not yet

subscribed for and purchased, if any, should be issued in the name set forth below.

Number of Shares of Common Stock _

Method of Payment of Exercise Price (note if cashless exercise pursuant to Section 3(i) of the Warrant or cash exercise

pursuant to Section 3(ii) of the Warrant, with consent of the Company and the Warrantholder) _

Aggregate Exercise Price: _

Holder:

By:

Name:

Title:

http://www.sec.gov/Archives/edgar/data/5272/000095012308016447/y72888exvl0w2.htm 12/1/2008
Page 18 of 18

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by a duly authorized officer.

Dated: November 25,2008

AMERICAN INTERNATIONAL GROUP, INC.

By: lsi David L. Herzog

Name: David L. Herzog

Title: Executive Vice President and

Chief Financial Officer

Attest:

By: lsI Kathleen E. Shannon

Name: Kathleen E. Shannon

Title: Senior Vice President and Secretary

[Signature Page to Warrant]

http://www.sec.gov/Archives/edgar/datal5272/000095012308016447/y72888exvl0w2.htrn 1211/2008


AMERICAN INTERNATIONAL GROUP,

INC.

ByMJQQA1LrlJltaA'IIfU/'IL;

Name: Kathleen E. Shannon

Title: Senior Vice President & Secretary

The New York Stock Exchange, Inc. hereby authorizes, upon official notice ofissuance,

the listing ofthe additional Common Stock. Reserving 53.798,766 shares of common

Stock. (TARP)

Nam

By:~r9Uh~" ~JatliCe<YNeill .

Title: Senior Vice Presi ent~ Corporate Compliance

-3-



WAIVER FOR THE COMPANY

In consideration for the benefits that it will receive as a result ofits participation in the

United States Department ofthe Treasury's Programs for Systemically Significant

Failing Institutions (as set forth in Notice 2008-PSSFI) and any other economic

stabilization program implemented by the Department ofthe Treasury under the

Emergency Economic Stabilization Act of2008 (the "EESA") either prior to or

subsequent to the date ofthis letter (any such program, including the Programs for

Systemically Significant Failing Institutions, an "EESA Program"), American

International Group, Inc. (together with its subsidiaries and affiliates, the "Company")

hereby voluntarily waives any claim against the United States for any changes to

compensation or benefits ofthe Company's employees that are required to comply with

the regulations issued by the Department ofthe Treasury in connection with an EESA

Program, including without limitation the regulations issued on October 14, 2008 and the

requirements of Section 4.10 ofthe Securities Purchase Agreement dated as ofNovember

25,2008 between the Company and the United States Department ofthe Treasury.

The Company acknowledges that the aforementioned regulations and such requirements

may require modification ofthe compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that the Company may have with its employees or

in which such employees may participate as the regulations and such requirements relate

to the period the United States holds any equity or debt securities ofthe Company

acquired through an EESA Program, including without limitation the Programs for

Systemically Significant Failing Institutions Program, or for any other period applicable

under such EESA Program.

This waiver includes all claims the Company may have under the laws ofthe United

States or any state related to the requirements imposed by the aforementioned regulations

and such requirements, including without limitation a claim for any compensation or

other payments or benefits the Company's employees would otherwise receive, any

challenge to the process by which the aforementioned regulations are or were adopted

and any tort or constitutional claim about the effect ofthese regulations on the

Company's employment relationship with its employees.

AMERICAN INTERNATIONAL

GROUP,INC.

BY:~~~~ Name: UTitle:

Date: November 25, 2008

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the "Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Prograrri'), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

IDtencl1D.g to be legally bound. I have executed this Waiver

as of this ~th day of November, 2008.

Name: 6~ce,~' Abn::l-..mS

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates. the

"Company") in the United States Department of. the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the "Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program")' I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

.,Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program.

lncluding without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this t¥th day of November, 2008.

L

I!! !

! / /

.t 1~1 A-F
WAIVER

In consideration for the benefits I will receive as a result ofthe participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFl) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or SUbsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitation"').

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arra.'1.gements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which 1may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program.

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable urider such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this --'.L.-th day of November, 2008.

Name: 14-7< 15;4 U {JI

-

•
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Programj, I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this ~th day of November, 2008.
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the "Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Prograrrt'), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations") .

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this ~th day of November, 2008.

Name: Jose.pn L. Boren
WAIVER . ..

In consideration for the benefits I will receive asa result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFIl and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic:.Stabilization Act of 2008 (the "Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation th~ regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect ofthese regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this .-.11...-_th day of November, 2008.

Name: F(o..nK.. C\t'\o...n
·. ~.

08-11-13; 15 : 30 ;AIG. K. K j 813-561 0-3401 # 6/ 6

WAIVER

In consideration for the benefits I will receive as a result ofthe participation of

American International Group, Inc. (together with its subsidiaries and afJiliates, the

·Company") in the United States Department of the Treasury'a Program for

Systemically Significant Failing Institutions (as aet forth in Notice 2008-PSSFI) and

other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the •Act") either

prior to or sUbsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an·J!ZSA

Prognzm"). I hereby volun~waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's omcers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department ofthe Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November l2, 2008 regarding the tenn sheet

agreement between the Company and United States Department of the Treasury (the

•Limftations").

I acknowledge that the aIorementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

f11Tangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equi1;y ordebt securities of the Company acquired through an EESA Program,

including without lhnitation the Program for Systemically Significant Failing

Institutions, or for S!l¥ other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws ofthe United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations arc or wcre adopted and any

tort or constitUtional claim about the effect of these regulations or Limitations on my

employment relationship.

Intendmc to 'be Ieeally bound, I have executed thfs Waiver

•• of thU ..l..2...th day ofl'Iovember, 2008.

Name:
WAIVER·

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter .from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Progratrf), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

" Limitations") .

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of tbese regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as ofthis 1.QL.th day of November, 2008.
;',

\

.m

..~.,.,

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the "Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12,2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations"). -

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements). whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending t,9 be legally bound, I have executed this Waiver

as of this Lth day of November, 2008.

Name:
WAIVER

In consideration for the benefits I will receive as a result of the participation of

America.Tl International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the "Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Prograrri'), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with" an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12,2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws ofthe United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a cll;lim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legal1y bound, I have executed this Waiver

as of this .J1.-th day of' November, 2008.
.-:..:

13/11 2008 THU 0.30 FAX +)5895161122 HOTBL RAMP HELSINKI Nov~.lZ-2008 05:39PlI FromWAIVER

T-274 P.009/011

1210 0 3/ 00 3

F-614

!;

~:

In consideration for the benefits I will receive 8.8 a result of the participation of

American International Group, Inc. (together with. its subaidiariea and affiliate:s, the

"Company") in the United States Department ofthe Treasury's Program for

SYllltemically Significant Failing Institutions (as set forth in Notice 2008-PSSFl) and

any other economic stabilization program implemented by the Department ofthe

Trea,sUIY under the Emersency Econo01ic StabilUatiQn Act of 2008 (the "4n") either

prior to or subsequent to the date of tnlsletter from me (any such program.

incl'L\ding the Program for Systemically Signifil:ant Failing Institutions, an "EBs.4

Prognzm"), I hereby voluntarily waive any claim agaU1'lSt any of the United States and

the Company, the Company's Board of t>irectol's, any individual memher of the

Comp$.11y's Board of Directors and the Company's OffiCCT6, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regula.tions issued by the Deparunent of the TreasuI}' in

connection with 81'1 EESA Program, including without limitation the regulations

issued on Ol;tober 20,2008, as well all the limitations under the letter agreement

between me and the Company dat'r.d November 12, 2008 regarding the term sheet

agreement between the Company and United States Department ofthe Treasury (the

..Ltmttations").

I E1.cknowledp that the afol'ementionecl. regulations and. Limitations may

t'equire modification or the compensation, bonus, incentive and other benefit plans,

arrangements. policies and agreements (including so-caned "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which 1 may participate as they relate to the period the United States holds liny

equity or debt securities of the Com.pany QOqt.lil'ed through an EESA Program,

including 'Without lintitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA PrQgl"&tl.'l. or

Limitations, as the c~e may be.

This'waiver includes all claims I ma.y have under the laws of the United States

or any state l'elated to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensa.tion or other

payments 0:' benc:fits 1 wculd. othctwille receive, any challenge to the process by

which the aforementioned. regulations or Limitations arc 01" were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on

employment rela.tionship.

Intending to ~e 1epUy bOQsul. I have exeollted thiljl Waiver

as of thia ...,L::::...th day ot Wovemb.r, 2008,

Name: \-\-OJ\'& \(. Da...Y\\ e.\ SSo
Nov 12 2008 4:17PM American International Gr (78~) 777 - 7599 p.2

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WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc, (together with its subsidiaries and affiliates, the

"COn2p4ny") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the ·Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with- an EESA Program, including without limitation the regulations.

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

•Limitation").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect ofthese regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as ofthis lLth day ofN'ovember. 2008.
:"i:

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department ofthe Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt sec'l,lrities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this ~th day of November, 2008.
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regul&.tions

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this L.:b-th day of November, 2008.

Name:
..~':

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Compand) in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Prograrrt'), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this JLth day of November, 2008.
- . .

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

·Company") in the United States Department of the TreasUIy's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the·Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "USA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12,2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acqUired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this.l.2-..th day of November, 2008.

Name: ke.i.-\-\'\ L. P,-, L\(.e-t\-
NOV 12 2008 13:48 FR

WAIVER

TO 12127703970 P.05/05

':.

.. In consideration for the benefits I will receive alJ a result of the participation of

.American litternational Group, Inc. (together with its sub.sidiaries and affiliates, the

"COrrJ,pCUl!f) in the United States Department of the TreasUry's Program for

Systemically Signu1C8Jlt Failing Institutions (as set forth in Notice 200S·PSSFI) and

any other econonlic stabilization program implemented by the Department ofthe .

TreasulY under the Emergency Economic Stabilization Act of 2008 (the·Act') either

prior to or subsequent to the date of this letter from me (any such program,

including the Program fOI" Systemically Significant Failing Institutions, an -.EES4

Program"),. I hereby voluntarily waive any claim against any of the United States and

the Coxnpany. the Company's Board of Directors, any individual member of the .

Company's Board of Directors and the Company's officers. employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program. including without limitation the regulations

ilJsued on October 20, 2008, as well as the limitations under the lette. agreement.

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

..Limit4tioRB").

I acknowledge that the aforementioned regulations and Limitations'may .

require modification of the compensation, bonus, incentive and othe. benefit plans.

arrangements. policies and agr-eements (including so-called "golden paraehute" .

agreements). whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or' debt securities ofthe Company acquired through an EESA Program,

inclUding without limitation the Program for Sy$temically Significant Failing

Institutions, or fOr any other period applicable under such EESA Program or

Limitations, 8.8 the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements impo~ed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits 1would othelWise receive, any challenge. to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

IntendJn, to be leplly bound. 1 have execute4 thi. Waf"e,

.. of thiB ~th day of November, 2008.

** TOTAL PAGE.05 **
::.~

Nov 12 2008 1:11PM RIG

WAIVER

p.5

In consideration for the benefits 1will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

ACompany") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFII and

any other economic stabiliza.tion program implemented by the Department of the

TreasuJY under the Emergency Economic Stabilizatjon Act of 2008 (the ItAct") either

prim- to or subsequ~nt to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntadly waive any claim against any of the United States and

the Company, the Company's Board of Directors, a.ny individual member of the

Company's Board of Directors and the Company's officers, employees,

representat:.ves and agents for any changes to my compensation or benefits that are

required to comply with the regulatiQns issued by the Department of the Treasury in

connectioc with an EESA Program. inclUding without limitation the regulations

issued on October 20, 2008, as well £.s the limitations under the letter agreement

between me and the Company datec. November 12. 2008 regarding the tenn sheet

agreement between the Company and United States Department of the Treasury (the

•Limitations").

] acknowledge that the aforecentioned regulations and Limitations may

require modification of the compensa';.ion, bonus, incentive and other benefit plans.

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or' debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver incI-..ldes all claims I may have under the laws of the United States

or any state related to the requiIemects imposed by the aforementioned regulations

and Limitations, including without limitation s. c~e.im lor any compensation or other

payments or benefits I would ot.herwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this ~th day of November, 2008.
IIltea.dinr to, be legally bound, I ~a'h aecuted this WaiveI'

as 01 tIda ~th day of Novoaa.beF, 2008.

In ~onsiderationfer the benefits I }Vill receive as a result of the participation of

Aroericanfnternational Group, Inc. (together with its sub.idiwit:s and affiliates, the

"Compll"#'l h\ the United States Octpartment of the TreasUTy'e Program fof'

SystenU~ly Significant Falling Instimtions (as sot forth in Notice 2008~PSSFll and

any otberfconomic stablJization program Unpletnented by the Oepaftn1ent of the

Treasury ~der the Eimergency ~nomic: Stabilization Act of 2008 (the"40&'') eil:her

prior to or ·aubsequent to the date of rbie letter from me (any such program"

inc1udblS the Program for SY$temic~Signi5cant Falling InBti~tiOns, an "B1t&9.

Prognzm"), I hereby voluntarily waive any claittl. against any ofthe U:gited States and

the Compapy, the CosnpanY'l:! Board o(Oirecttll's, any individual momber olthe

Company', Board of Directors and the CompDny's officers, employee,_

reprel'er:l:bl.~lB and agents for an)' changes to xny compcnsatiol'l or benefits that are

required to! comply with the regulations issued by the Department oC the Treasury in

connectiot\;with an EESA Program, inc:ludins without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter flInement

between mil' and the Company dated Nove=ber 12, 2008 regarding the term sheet

agreement l>etween the Coznpany IlI1d United States Department ofthe Treasuxy (the

. "Lbnite&'«olls"j.

I ae~owll!ldge that the aforementioned ~gulation8 and Litnite.tions

require moqification of the c:ompensation, bonw, incentive and other benefit plans,

WTangem.ents, policies and ~eemetl'ttJ (inclUding 4c·c:alled "goldstl parachute"

agreements). whether or not in writing, that 1may have with 'the Company or in

which I sn~ participate as they relate to tho period the Ur.lited States holds any

equity or"clept seO'l.U'itiee of the Company acquired through an EESA Program,

il1clucUng without lirnitation the Program for Systemically Significant FallinS

Institutions,. or for any other period applicable under sueh EESA PTogyam or

Limitationa'las the case·may be.

'l'hie ~ver includes all clairlu 1may have under the laws of the United SC:-W8 g. any $tate :related to the requirements imposed by the aforementioned regulations

and Limi:ta.tions, including without limitation i. claim £or any c:ompensation or other

pa,ymenta or benefitsl 'Would otherwiue reeeil7e. any challenge to the prCll;Css by

wh!cb the aIorementioned regulations or Limitations are or were adopted and any

tort or OOI)$t;iwtional claim about the effect of these tegtllatiDn$ or ltimitationa on my

employment ;relationship.

T-299 P.G02/002 F-S05 21 Z344SSGS 11:47pm From-tront desk

£J(J(f2~ ,

Name: Fr d. e r' / (' A/ (i-e (;;r(//t e /
,~.

';:'

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WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic· Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this --\]Lth day of November, 2008.
.,

,',:

WAIVER

In consideration for the benefits I will receive as a result of the participation 0

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States ane

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12,2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations"). ...J

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the· Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United State~

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or con-stitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this ..12-th day of November, 2008.
," FROM: HAYMAN TOKYO HOME FAX NO. :81353551267

WAIVER

Nov. 16 2008 03:58PM P6

'-'.

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"eompaJtY") in the United States Department of the Treasuzy's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Ad") either

prior to or subsequent to the date of this letter from me (any such program.

lncluding the Program for Systemically Significant Failing Institutions, an "BaA

~m"),I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors. any individual member of the

Company's Board of Directors and the Company's officers, employees.

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well a.s the limitationll under the letter agreement

between me and the Company dated November 12, 2008 regarding the tenn sheet

agreement between the Company and United States Department of the Treasury (the

ftLfndtatkJna").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policiee and agreements (including so-called "golden parachuteagreements), whether or not in writing, that I may have with the Company or in

which I participate as they relate to the period the United States holds any

equity or debt securitiea of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the ease may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirement. imposed by the aforementioned regulations

and LimitatiOM, including without limitation a claim for any compensation or other

payments or benefits 1would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect ofthese regulations or Limitations on my

employment relationship.

Intending to be iecaDI' boUlld, I have ezecated thJa WaiV8r

.a of thU ~thday of Bovember. 2008.
...... ,

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Prograrrf), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

represent.atives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations") .

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this ~th day of November, 2008•
2149322352 Casualty Risk Mgmt.

(JItCt U&-L-IIVC f}gV~tYtV[)

JJ;2 - ;)0 - 3970

WAIVER

04:46:13 p.m. 11-12-2008 2/3

.,

;

i ..

::.

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

-CompClny") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the -Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an -USA

l'rognIm"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on Octol?er 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

•LimitationS').

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called -golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

IntencUllc to be legally bolUld, I have executed this Waiver

a8 of this -.JLth clay of November, 2008.

Name: )l'J1.I~ m f1-vIf

~~------... ----
".

.:.

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the U Act") either

prior to or subsequent to the date of this letter from me (any such program,

inclUding the Program for Systemically Significant Failing Institutions, an "EESA

Program»), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intendini to be legally bound, I have executed this Waiver

as of this ~th day of November, 2008.

•

Name: 12. /.,r;j- I."lr-?
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12,2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations") .

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreementsj, whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, 1 have executed this Waiver

as of this _~th day of November, 2008.

Name:
WAIVER

In cDnsideration for the benefits I will receive as a result Df the participatiDn of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department Df the Treasury's PrDgram for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency EconDmic Stabilization Act of 2008 (the "Act") either

priDr to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the CDmpany, the Company's Board of Directors, any individual member of the

Company's Board of DirectDrs and the CDmpany's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to cDmply with the regulations issued by the Department of the Treasury in

cDnnection with an EESA PrDgram, including without limitation the regulations

issued on October 20, 2008, as well as the limitatiDns under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the afDrementiDned regulations and Limitations may

require modification of the compensation, bonus, incentive and Dther benefit plans,

arrangements, policies and agreements (inclUding sD-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

.Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, inclUding withDut limitation a claim fDr any cDmpensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending tq:be legally bound, I have executed this Waiver

as of this _'_V_th day of November, 2008.

2,;;;1'
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Compan!l) in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12,2008 regarding the tenn sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bQ11us, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden paraChute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regu!ations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this ---l.2::-th day of November, 2008.

Name:
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and afflliates, the

·CompAny") in the United States Department of the Trea:nlJ"y,s Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Insti~tions, an "USA

Progra.m"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual.member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department ofthe Treasury (the

"Limftatlon6').

I acknowledge that the aforementioned regulation~ ~Q,. ~imitations may

require modification of the compensation, bonus, incentive i¢d other benefit plans,

arrangements, policies and agreements (including so-called "'golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity ordebt securities of the Company acquired through an' EE.SA Program,

including without limitation the Program for Systemically Sign.ificant Failing

Institutions, or for any other period applicable under such EESA Program. or .Limitations, as the case may be. ,. .

This waiver includes all claims I may have under the laws pf the United States

or any state related to the requirements imposed by the afprementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge .to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations .or Limitations on my

employment relationship. .

IDtending to be legally bOUDd, I have executed this Waiver

a8 of this --.Lth clay of November, 2008. ,:
>. ".

:~

11/12/2008 07:55 2124252175

WAIVER

AIG PAGE 02/02

In consideration for the benefits I will receive as a. result of the participation of

American International Group, Inc. (together with its sUb!ddiaries and affiliates, the

"Company") in the United States Department of the Treasury-'s Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabiliza.tion Act of 2008 (the •Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an ".E&SA

Program")I I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

«Ltmitd.tion5").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus; incentive and other benefit plans,

arrangements, policies and agreements (inclUding so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which 1may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, Or for any other period applicable under such EESA Program. or

Limitations, a.s the case may be.

This waiver inclucles all claims 1may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits 1would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

InteQding ~~ be legally bound, I have executed this Waiver

as of this JLtlJ. day of November, 2008.

aWk~Cb,~/

Name: AY1C\s\o..Sia... D. K.e\\y
Nov 12 08 06:20p Robert Lewis 1-252-453-8470 p.6

WAIVER.

In consideration for the benefits 1 will receive as a result of the participation of

American International Group. Inc. (together with its subsidiaries and affiliates. the

·Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the "Adj either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions. an II'EESA

Program"l, I hereby voluntarily waive any claim against any of the United States and

the Company. the Company's Board of Directors. any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008. as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the tenn sheet

agreement between the Company and United States Department ofthe Treasury (the

aLimitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-<:a.lled '"golden parachute"

agreements}, whether or not in writing, that 1 may have with the Company or in

which I may participate as they relate to the period the United States holds any

equi~ or 'debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims 1may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim. for any compensation 0:- other

payments or benefits 1 would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as oftbis l1..- th day of November, 2008.
"Tn consideration for the benefits I will rec=ive as II. result of the participatiou of

Americln'J, International Group, Inc. (together with i.ts wblidia:ries and affiliates, the

/llCo~)in the United State. Department oftbe Treasuxy's Program for

SyBteIni£:ally Sign;ficatlt Failing Inatituticns (as eet forth in Notice 20oa-PSSFI) and

aJ:3.Y other eccnomi~ etabilia.tion progr-am implemented by the Department of ~e

Tre~UIYunder the Emetgency Economic Stabiliza.1;ion Act of 2008 (the·Act') eithe!'

prior to or wb:sequent to the date ofthis lettlllJ' from me (any such prosnun,

including thE Program for ~temica1,1y Significant Fai1~ In~titutian8. an /II.BBSA

.PrGgNm"), I hereby voluntarily waiq any claim against any of the United States and

the Company, the Compa.tJ.Y's Board of Directots, any individual member of the

CompMoY'. Beard of Oirec:tcra and the Company's officers. employees,

representatives and agents for any changes to my compensation or benefits tha,t are

req1Ure<! to comply with the regula.tiona issu.cd by the Dep81'trJ1Ent ofthe Treasury in

connection with an EESA Prosnun) ineludini without limitation the re~tions

issued on Ootober- 20. 2008, U \VeD u the li1nitation. under the letter qreetnent

between me anc!. the Company dated November 12, 2008 regarding the term sheet

agreement 'betwe~ the Company ed United. States Department of the Treasury {the

"Lintit4ttoM").

I acknowledge that the aforementioned regulations and Limita:tions may

require modification ofthe compcnl\Rltion, bonus, incentive aftd otb~ benefit plans,

arrangementa. policies and agreements. (including so-called "golden para.cbute"

agreements), whether or not in wrim"g. that I may have with the Company or in

w1')ich I may participate as they relate to the period. the United StaW$ holds any

equity or debt securities of Company acquired through 1m EESJ\ Progam,

including without linUtation the ~sram for Systemically Significant Failing

In$titutions. or for any ather period. applit:able U1'1cl.er su.ch EESA Prcpm or

Limitations, as the case may be.

This waiver includes all claims I may ha.'\l't 'Under the laws ofthe United States

or any "tate related. to the requirements imposed by the aforementioned Iegll1ationa

and. Limitation$. Ulcluclin& 'JII'ithout limitation a claim for any compensation or other

~ntsor benefits I 'WoWd. othe~e ree:=.ve. any c:h.nenge to the process by

which the aforem.cntioned regulationa or Limitations are or were adopted and

tort Dr constitlltional claim a.bout the effect ofthese regulations or Limitations en my

emplO)'1;lent ma.tionship.

'"'v. 13. 212108 lE 2: 14PM121:l:EO DEPT AIG CORP COMP

WAJyIR

NO. 520 P.7/9;:: 67109

IJltendJq to be lepU,. boud, I bave aaeuted, tb.i8 Waiver

.a attJda ~th"-7 of November, 2008.
;;

:{

WAIVER

In consideration for the benefits 1will receive as a result of the participation of

American International Group, Inc. (together \\'ith its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or su bsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program.'"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

..Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in,writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities ofthe Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this ~th day of November, 2008.

-~Name:

!?od
11/11/2008 01:55 2136893773 VINCE MASUCCI PAGE 06/09

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WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (togeth~r with its subsidiaries and affiliates, the

"Compan¥') in the United States Department of the Trea.sury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008·PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 [the "Aat") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions. an "DSA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my cornpensation or benefits that are

required to comply with the regulations issued by the Department ofthe TreasuIY in

connection with an EESA Program, including without limitation the l;e&Ulations

issued on October 20, 2008, as well a~ the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"LtmitationB").

I acknowledge that the aforementioned regulations and Limitations may

T(!quire modification ofthe compensation, bonus, incentive and other benefit plans,

arrangements, polich!$ and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to.the period the United States holds any

equity or 'debt securities of the Company acquired through an EESA Program,

including withou t limitation the ~gram for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program. or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits J would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship•

IDtendlng to be legally bound, I have executed thi. Waiver

as of this ~th day of November, 2008.

" '''-

NaD1e: Vi (\~ J- Ma0tJcc. I
WAIVER

In consideration for the benefIts I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affJ.1iates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the -Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called -golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this ~th day of November, 2008.
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) arid

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12,2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachuteagreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound. I have executed this Waiver

as of this 1Lth day of November. 2008.
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, inclUding without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12,2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations") .

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements). whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations. including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this ~th day of November, 2008.

~-v------­ I
',:::

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the "Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), 1 hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Inten-dmg to be legally bound, I have executed this Waiver

as of this (L.. th day of November, 2008.
1l/13/20E1B 16: lEI 6239754357 THE UPS STORE PAGE Ell

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WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Companyj in the United States Department of the Treaswy's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the "Aet") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an IIEBSA

Prognzm"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for ·any changes to my compensation or benefits that are

required to comply with the regulations issued by the Pepartment of the Treasury in

cOIUlection with· an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the ItLimitationS').

I aclmowledge that the aforementioned regulations and Limitations may

require modification ofthe com.pensation, bonus, incentive and oth.er benefit plans,

arrangements1 policies and agreements (inclUding so-called -golden parachute"

agreements), whether or not in wri~ng, that I may have with the Company or in

which I ma,y participate as they rel8.te to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

inclUding without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may' be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Umitations are or were adopted and any

tort or constitutional claim about the effect ofthese regulations or Limitations on my

employment relationship.

IntendiJlg to be legally bound, I have executed this Waiver

as of this ~th clay of November, 2008.
WAIVER

In consideration for the benefits I will receive as a res'ult of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates; the

"Compan1/') in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as &et forth in Notice 2008-PSSF£l and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the "Ad') either

prior to or subsequent to Ule date of this letter from me (any such program,

including the PrOgr'cI1l1 for Systemically Significant Failing Institutions, an uEESA

Progn..,n"),l hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or beneftts that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, induding without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

•Limitation.s").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called ~golden parachute"

agreements), whether or not in writing, that r may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions. or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this l:2-th day of November, 2008.
· .

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group. Inc. (together with its subsidiaries and affiliates, the

·Compan.y") in the United States Department of the Treaswy's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI] and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Acf') either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Prograrrf), I hereby voh:1ntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the tenn sheet

agreement between the Company and United States Department of the Treasury (the

•Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called ·golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or: debt securities of the Gompany acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits· I would otherwise receive, any chaflenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waivu

as of this.l3::-th dayrf'IJovember, 2008.

I

Name:
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

·Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Prograrri'), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations") .

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachuteD

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for ahy other period applicable under such EESA Program or

Limitations, as the case may be·.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this ..l..!:::.-th day of November, 2008.

Name:

~ld-..,
~.

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the U Act") either

prior to or subsequent to the date of this letter from me (any such program,

induding the Program for Systemically Significant Failing Institutions, all, "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with· an EESA Program, inclUding without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12. 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations") .

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing. that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or-debt securities of the'Company acquired through an EESA Program.

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the· United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this...l.!:....th day of November, 2008.

Name: C. HA /l. LEO:;; fJ.. c:;' <: f-I A f) t=.fL
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Prograrrt'), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Inten.ding to be legally bound, I have executed this Waiver

as of this l.1:::.-th day of November, 2008.
.~

WAIVER

In consideration for the benefits rwill receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Fa,iling Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Progrmn"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the tenn sheet

agreement between the Company and United States Department of the Treasury (the

"Lirnitations") .

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically SigniflCant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

aa of this ~th day of November, 2008.
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program."), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated Novemper 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitattons").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities o(the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this ~th day of November, 2008.

~jF'~

Name: KoJ-h..lu..n E .Sh.a.t\.f\6Yl..-
,.

.'.I,

,.

.,

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

·Company") in the United Stales Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFl) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 {the (lAct") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

ProgratrC'), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board ofDirectors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

U Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or ·debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any ather period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and' any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound. I have executed this Waiver

as of this ..lS...th day of November. 2008.

~::r:~ Name: (Zobev t .:J. l1Io\'Y\Q..8
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations") .

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this ----il-th day of November, 2008.

Name: !j;pf-'1utJy ISf:
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions {as set forth in Notice 200S-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Programj, I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors; any individual member ofthe

Company's Board of Direc::tors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 200S, as well as the limitatioris under the letter agreement

between me and the Company dated November 12, 200S regarding theterrn sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachuteagreements), whether or not in writing, that I may have with the Company or in .

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired througll an EJi:SA Program,

including without iimitationthe Program for Systemically Significant Failing

Institutions, or fOL any other period applicable under such EESAProgram or Limitations, as the case may be. . .

This waiver includes all claims I may have under the laws of the United States

or any stateidatedto the requirements·imposedby the aforementioned regulations

and Limitations, including without limitation a claim. for any compensation or other

payments orbenefits I would otherwise receive, any challenge to the process by

which the aforem.c:iltioned regulations· orLimitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as ofth1a-l.k-.th day of November. 2008.

tV'f--

Name: tV .S.-1'/L~1"<.
""'!"

WAIVER

In consideration for the benefits I will receive as a result ofthe participation of

American International Group. Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program'], I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with- an EESA Program, including without limitation the regulations

issued on October 20.2008, as well as the limitations under the letter agreement

between me and the Company dated November 12,2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Lfmttations").

I acknowledge that the aforementioned regulations and Limitations may

require modification ofthe compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (inclUding so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired througb an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any o·ther period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Name:

y bound, I have executed this Waiver

of November, 2008.
'"

J'.:.

.;.

".

!

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EBSA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with· an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intendingti-..be legally bound. I have executed this Waiver

..~r'2008'

Name:
WAIV£R

In considcratiol\ f"r t.he henefit.II·1 will n~ccivc l\!l II rc:mlt 01' the p,'\rtkiputioll (If

Americ;m Inh~rnati()n.l) Grelllp, 1rll;. {lORtUlC~r with its Il\lLJ!;idi.~.;cs nlHl Mfilil.\L('li, the

"Company"} in the lJnited 8ts!.ttS Department ofthe Trtaiit\l'y'll ProSl':Hll for

:·'y:;lcrnicall)' SignihcHnt Foiling InstitutionI', lils liel forth in Notke :2008·rSHr-o and

any olher economic stnbili7.atioll pmwam implclnentp.d by the J.)cp;;rtlll"n' or lhl';

Trt'a:!lIt1' \Il1rkr I'he Emcrg'mr.y Ecnnolllit.: SlJlbiliy.llt;on Act of '2.008 (the·Act") r.ith.~r

prior ti) 01" l!ltlbSC(J'II~I"lt \0 th.! dale of thill h:ttr.r f1''''m me (allY :'itlch pl-()/~r<lI'l,

ill(:hldinl~ thl: Proftl'arn for Syslcmicnlly Significant F:tilinll, 11I~tillilions, :m "EESA

Program"), I herr-hy volulllnrily wai~-c '\hy claim against any of th~ United Sti.ltes nnd

lhe Company., the COlllp,lIly'S; BOiU'd flf Dirt~ctol"3, '1ny individual mCnlllf!r CIf the

Compony's Board of Directors and the COffiPllny's officers, empJ0.YceN,

I·r.plf:sentiltiyc~ and agents (or any changes to my compcmll~lionor benefits that l~rf'

required tv comply wilh the regulatiolls is!lIIC~ by tht: Dl'PaI"lmcnt of I·he Trf:ClI:lI.lry ill

conllectiOl1 with nn EESA Progrnlll, il1chlding williout Iimitalion the resulations

iRfillflrl nn Od'f,ber 20, 2001.1, M. well as the Jimitatjnn~ lIndl~· tlJ(: letter agrcl:ment

1lf!n.'Ip.t:1l me lmel llw (;ompaJly dated November 12, 200& rcy,nnling the l.~nn !llll.oct

agrC('lT!I:nt bctvillcn tht! Cr.>Inpllny nnd Unitec1 SU\I(J.~ Depilrtmcilt of the "I'IlMatry (the

,. Llmitatlotls·').

1 :.r.knowkdgr. Omt thn aron:mlmlil)nc~rt rCJ;ulntions and Limiltltiona ll'IHy

n:'llJin: Illodification of lhe (:ompcnsa.t.i'ln, hl)nl1l1, illeimtive uno nth!:l- ~l1dit. p!nnli,

l1rran'.lmnent.s, policies lItld :lgn~(:lI1cnts (including so-called '~oldcn pumehute

agreements), whether 01' not in writillg, thut 1 may hnvc with the Compnny or in

which I rn~~'y llarlic..,ijmlc ..\11 I.hey rel~tle to the p<:riod UII:: Unilt:d SI<lks holds <IllY

equity ur debt t.ccuritiCI! or 1\'\.: Company al~quirlld through nn EESA Pmgrulll,

indllc..ling ",ilhllullimital.i'ln the Pl'ogram for Hyslemir.ally Si/~lliflcant fuiling

Inslilutions, (.IC for any nlh.:r period applicable llllder slIch EESA Prngl·''lI1I or

Umitntion!l, (10 lh.~ C;l-\liC rntiy be.

This waiver inr.hldcs 011 dllhns I may have under the laws oC the United Stales

or any state relntcd to the requircmcnl:i im·po:I('.d by the aforementioned regulationll

"no Limil.,l iOIlS, inducliu8 without lilllit<ltioll II c1.-um for any compcnm'ltion or other

paymentll or benefits I would ot.herwi!lp. receivc, :my challenge tl) the pro(,~!l$ by

whieh the <tforcmcnliMlr.d rC~ll'illioml or Limitatiuns arr. 01' were ,'ldoplcd and any

InrI Of t:onsiih.llionul chliUl auoutlhl: c~{{&:ct fl( thelle Icgul<1lions 01' LirnilaliutHl un my

cmpJoycJI(mt rl~llIlil1nship.

Intending to be hl~ally bound. I have cJlccutell this Wai"cJ'

"7~: .._.u.~~

;:LI!... _. ...._~n __.__..

Name:
III

WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the "Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Prograrri'), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with an EESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

"Limitations") .

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation 01 other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of thisL9 th day of November, 2008.

Name: C. hones 6-. Wi \ hC,\r11 Son II.
• . Nav-l2-0B

:,

"

;

.'

12:51 Fram-AIG Uark Wi II is

WAIVER.

3126270291 T-171 P.006/006 F-137

;.

.'

"

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Compcmg") in the United States Departtnent of the Treasury's Program for'

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Departznent of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the "Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically- Significant Failing Institutions, an "BBSA

Progrclm"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company-'s Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any ch~ges to my compensation or henefits that are

required to comply with the regulations issued by the Department ofthe TreaSl.Uy in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Depa.r1:r.nent of the Treasury (the

IILimitCltions").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (inclucling 8o~called "golden parachute"

agreementa), whether ot' not in writing, that I may have with the Com.pany or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Coo:tpany acquired through an EESA ProgtaIn,

including without limitation the Program for Systemically Signifir::ent Falling

Institutions, or for any other period applicable under such EESA Program. or

Limitations, as the cue may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the lliorementioned regl.1lations

and Limitations, including without limitation a claim for any compensation or other

p~ents Or benefits I would otherwise receive, any challenge to the process by

which the aforem.entioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally boun4, I have executed this Waiver

as of thisA-th day ofNo'Vember, 2008.

~.)i

Name: MCA<K T. V\},\\'S
WAIVER

In consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Compan!l') in the United States Department of the Treasury"s Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury' under the Emergency Economic Stabilization Act of 2008 (the "Act") either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Program"), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury' in

connection with an EESA Program, including without limitation the regulations

issued on October 20, 2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury' (the

"Ltmitations").

I acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing, that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity or debt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically Significant Failing

Institutions, or for any other period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would othetwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound, I have executed this Waiver

as of this JLth day of November, 2008.

,

Name: rv'\~+1he..v c. W\I'\W

1

I
•

,'.

.

..

WAIVER

[n consideration for the benefits I will receive as a result of the participation of

American International Group, Inc. (together with its subsidiaries and affiliates, the

"Company") in the United States Department of the Treasury's Program for

Systemically Significant Failing Institutions (as set forth in Notice 2008-PSSFI) and

any other economic stabilization program implemented by the Department of the

Treasury under the Emergency Economic Stabilization Act of 2008 (the"Acf') either

prior to or subsequent to the date of this letter from me (any such program,

including the Program for Systemically Significant Failing Institutions, an "EESA

Progranf), I hereby voluntarily waive any claim against any of the United States and

the Company, the Company's Board of Directors, any individual member of the

Company's Board of Directors and the Company's officers, employees,

representatives and agents for any changes to my compensation or benefits that are

required to comply with the regulations issued by the Department of the Treasury in

connection with· an E'ESA Program, including without limitation the regulations

issued on October 20,2008, as well as the limitations under the letter agreement

between me and the Company dated November 12, 2008 regarding the term sheet

agreement between the Company and United States Department of the Treasury (the

IILtmtt«tions").

J acknowledge that the aforementioned regulations and Limitations may

require modification of the compensation, bonus, incentive and other benefit plans,

arrangements, policies and agreements (including so-called "golden parachute"

agreements), whether or not in writing,. that I may have with the Company or in

which I may participate as they relate to the period the United States holds any

equity ordebt securities of the Company acquired through an EESA Program,

including without limitation the Program for Systemically' Significant Failing

Institutions, or for any o~ther .period applicable under such EESA Program or

Limitations, as the case may be.

This waiver includes all claims I may have under the laws of the United States

or any state related to the requirements imposed by the aforementioned regulations

and Limitations, including without limitation a claim for any compensation or other

payments or benefits I would otherwise receive, any challenge to the process by

which the aforementioned regulations or Limitations are or were adopted and any

tort or constitutional claim about the effect of these regulations or Limitations on my

employment relationship.

Intending to be legally bound.. I have executed this Waiver

as ofthis .J.t..th day of November, 2008.
.... ';;:;·~~"'~'.~~·L'~li!"/L il:~" t.L~: bth·r:~.~(:t~.~. i '.\'~ll ~,\.,,:.,:>:,,: ~~ ~1 n.:.~~..:~~ \.-1 : :-,.~. ~.:.:..~;.:~. ~i::.;L~:'r: :.:'

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.-:.,,':.t,,·~:~;<._.~:,;> :SI~'.Lj~·lt.:~~;" ~'\di;!:t: i: •.~:t;ll .• l.;U(H; :llt't ~jl~{ :-.)fl;-; ;1', ).:~.!l.i ..:t: 2t.);:)b·:.,lS.~;F:; .~Ji:.~

:;!':~\'I:~ ~;: ~: .. :~!~::,;~:~~~:i~ :':,.:;:~ ~,;:~.~.~,:::~~,t, 'i;;,l.~:):,:,;.:~:;:~:.::.~ ;I~,~::~l::\·t;j:i:::,: :'~~: ~~ .-~~;: ::I:~.;;~~!r';~:.~·:::··~· :~:~";':I :.l:,~ i' t;:

.L\:J.l'4·tl:.~ : ..•. \f:-\·:~:·.. !r:~ .'~::. "';~:~~t.·~;: ..~·.i:~:\ :~ /.~~::.~~L~;' ;~.ult:.:..... :il.·,,"~; .. ti":'" '11 'E~ES/1

"[>rogrUl"n"]. L L('rt.:l.. .. \·· ..j~!..~:~:.\.ln;·.~· \\· .... i·,·t.: ,~.~;:.. ~:;;·H~J :.~ .. ..I~n.:~: :i.ny ,;l' t!\r.' l ;UL~ ... j ~:",d\:~·, ~t:>..

t;it: CC!ni);..1t~Y, ~h,:: C\;rl':p~4n~/~:j ljix~rd u:" iJir,::.:v..':"';;; ...~n:.- indi\·id\.;~1! :It'.::fJ''~l/, r :.d· U'>:

C0!l'~p;,,\~~>·lS D'J.:1.i'd .)~. t)i:'(':',:lU~'~'\ <:,\C'.d th~,; l\.;fn~i.i;):/~ ,}~Tic<:r~. t.':~p-\(j:~'''''''~'~''''

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::·"S··~(.'C: '..\n l)C\:"J1>i.--;r '20. 2G(\~\ ~i:J v;(,H ... t~ tr:.~ ~j':.r~H~.ll~L.r~:l ur~de~~ t;-~L' k:tt~'r ~gn,:~;nt:n:.

:)~·l·.\,·l.·t:,. ~nt.: ..i:}d iht'" C.,1ff'i'J::u:y dal{~'d N!,,:·\'t.:tnbc..':r 2, 20G8 p}g':'l,rdirtg tbl' h.:nE ~,;ii-:.:r:t

,;,·.r~<~,",:t;,~;·;:t b<~~\'~'f,~~'l~ tl:c (.:.~·fqi;dJY :':::~ll :.;Z)~',<..~d ~Ld~"''''' Dj"·t'.~J:·u~'~,:n) (jf ;ht:· f;"rr·~lS .. ;~: f·!.~·

i :~~:knt)·...\'~t.'dgl' t.Lat :.be :.:~[Crt..·Gt<.::tl~il.;nL'd :-':"::;:.l~jdjun:-) ;j:-:d LirniL·;:i·'~Il~~ ::~ ..{~

;:~;~:~~~.l~~~~~i :!:,;~.~:' [~~~~~£.~ )Pl~~~·~:~:'::~~;ri~t~;';~: ~;,~::~~::~:~,~~.~; 7J~'!~~::.:';:,:~:~\ ~~~~:~~';~:l,):' ri;;i;'~'~£:~:':: i~;~:' :;~;. ·.... ... ;;,:h : :~'l ..lY ~).Jru:..;iptil.c ..:'l';' ~ht..;~:. r'~'LJ,tl'; :\.;. ~:~," r!l:,r:~~~.; ·;L!..' \.. !:"H1J:(~ ~~:t~'\t;,"f,. L~jlJs 'i.':-':,,-

.-.~,::~~:.~ ..' ,;;:' d<~bt ~~e'"::-t:d~k)';ii Ot~ tZ·;,;- c..\::):n;·~·.:u'l.'" a ...·qui:-.::·j tL.f,)'"!~;h t:~·~ i"::E:~:..\ P~~u~;:·~,~l1": .

.t;.,···.J:;: ':.-' ~,"'"lt~\~.~;:t :::";LLit;(:n ~.!"t;:" ?r<)~~~ ...~~:} ft;f ;:-::,,·:;t<:!r~;~.:().:~-.~: ~li~~1d·:c~....rH F\,tiEn:,,~

:f:~,:·.i·:'J~i!::··,:·., rq' (o:~ ~~dl\' J":th •.:r· ;'1::'i':J{i )PF'l:c.~;~·I~~ :inde;' ~~t:C:) i":ESA P~·{\l.~~raf:-: ()j"

T~nb, ....\·.sP.:cr ~n\;l~H..h:}; ail ..;ldiln~ l r~i':lY I:-c.:·;....: i,{;;(:-t:r ti'h: ;(:ov:s till.he U:1~:l.':": ;~i.;i.~\::"

':'~'i::1~\ ~~~~~:I~~)~:'lfr~ ~~ J:~~g! :~i~i':~'~i:- ~:~~~.:~~~,~~:~~1:::;:-,( i/t~:' ;-~~.~~~ ~:(~~'::l~~~~:~~;:';-;;~~:;:',~,);i:;~,~ :)~1:: n~cJn~s or i.i\.~r\t.:fit:.-i 1 \v(H.ll(l oth~\-.vts~~ rt;~.:l.:;v\;.•Jr:.y c;1.a.il\.:ng~ i.~ 'U1C !):·vct.·~"'i::-; ~')y

'.l.. ;-::ch :1 l~ ..:i;!Jft:: r-n('tl !i~)t)(.:ci rl:i~;U l:j t ir'';·r.:-; ;:::~ !.inl1 L't:"h~;'~ ;,.{ r(.· '..'!' \l:~ ~.t: ;:tl,.:()pt(t1 ;';lLd ~::,~'l:~'

»:-', vi" .::<..?;·~~:.::,,-.. :.:.orlal \.:L·~i~·n ~'tbrj:.a l.h:.:: L:~'(:""''';l '.)1' :~'~t:~\h~ ;"-l~~ .....d;;A.~~ ...~i'$ 'J~. ... at;l;''''~{:lJ!i~ ·.)~1 :n>

""::;~~>~'J'" '.;·.:'.::t~" i'l..:;a~i\..'rI0l·.{~p.

iill.l:IHHn~ I.":' 1>0: h:l;;aUy 1J.;tHH1. I 111'\1\'. t'1«,cutcu this W"iv"r

"s vf tllis .. til tllly of November. 2008.