_









 








 


Exhibit 10(6)


 


American
International Group, Inc.


  Annual
Short-Term Incentive Plan 


as Amended September 9,
2014 


 


 


1.           
 Purpose


American International Group,
Inc. (“AIG” and together with its consolidated subsidiaries, the
“Company”) has created this American International Group, Inc.
Annual Short-Term Incentive Plan (this “Plan”) to strengthen our
pay-for-performance culture by rewarding employees for business and individual
performance during the applicable Performance Year.  This Plan replaces the American
International Group, Inc. 2013 Short-Term Incentive Plan beginning with the
Performance Year from January 1, 2014 through December 31, 2014.  Awards under
this Plan (each, an “Incentive Award”) will be in the form of
cash.  Capitalized terms not otherwise defined herein will have the meanings
set forth in the Glossary of Terms in Appendix A. 


2.           
 Performance Periods


This Plan will operate for
successive one-year periods beginning on January 1 of each year (each, a “Performance
Year”) until this Plan is terminated by the Compensation and Management
Resources Committee of the Board of Directors of AIG (including any successor
thereto, the “Committee”).  The first Performance Year will be
January 1, 2014 through December 31, 2014.


3.           
 Eligibility


All full and part-time employees
of the Company, excluding external contractors, independent contractors,
temporary workers, and independent agents during the applicable Performance
Year (the “Participants”) are eligible to participate in this
Plan for such Performance Year, unless the employee is a participant in another
variable pay or sales plan that the applicable business has determined is in
lieu of this Plan during such Performance Year.  For the avoidance of doubt,
employees who are eligible to participate in a bonus plan that is required to
be provided under local law or who have an employment contract with AIG or its
subsidiaries for ongoing employment of unlimited duration that is not confined
to a specific, finite project will not be ineligible for the Plan (unless the
applicable business expressly elects to exclude such employee).  If an
individual is hired after the Performance Year commences, the individual may
become a Participant in the Plan, and the amount of his or her Incentive Award
may be Pro-Rated to reflect the portion of the Performance Year worked.


4.           
 Bonus Pool Funding


A.           
Determination.  As soon as practicable following a Performance
Year, the Committee will determine the aggregate bonus pool (the “Earned
Bonus Pool”) to ensure that the Plan rewards all Participants
appropriately and consistent with the purpose of this Plan.  Promptly following
this determination, the Compensation Center of Excellence (“Compensation
COE”) under the direction of the Operating Committee will allocate the
Earned Bonus Pool to each of the 







 


















 








Business/Functional
Segments.  Prior to March 31st of any Performance Year, the
Committee will have the discretion to establish a threshold goal (the “Threshold
Goal”) and determine that, if the Threshold Goal is not met, the Earned
Bonus Pool will be capped at a fixed amount (including $0) or the amount
resulting from a specified formula.


B.           
Exceptions to Earned Bonus Pool.  As soon as practicable
following a Performance Year, the Committee will determine whether the
Incentive Awards for any Participants will be excluded from, and not subject
to, the Earned Bonus Pool.


5.           
 Incentive Awards


A.           
Amount and Form.  Prior to or as soon as practicable following
the commencement of a Performance Year, a Participant’s target Incentive Award
(the “Individual Target Award”) will be established by the
Committee or the applicable Business/Functional Segment in which the
Participant is Employed.  The Individual Target Award will generally be
established after considering the Participant’s job grade, business, local market,
job scope, responsibilities and experience.


B.           
Performance Metrics.  Prior to or as soon as practicable
following the commencement of a Performance Year, the Committee will determine
the performance metric(s) (each, a “Performance Metric”) and the
manner in which each Participant’s actual Incentive Award (the “Earned
Individual Award”) will be calculated for such Performance Year. 
Unless otherwise determined by the Committee, there will be three categories of
Performance Metrics:  (1) Company-based Performance Metrics, (2)
Business/Functional Segment-based Performance Metrics and (3) Individual-based
Performance Metrics; provided that for any Performance Year there will
be at least one Company-based Performance Metric or Business/Functional
Segment-based Performance Metric (which could include the Threshold Goal).  The
Earned Individual Awards may be determined for any Performance Year on the
basis of one or any combination of the Performance Metrics, as determined by
the Committee in its sole discretion, and the Performance Metrics will be
documented in a written Administrative Guide prepared by management for the
Performance Year.  In determining the manner in which the Earned Individual
Award will be calculated, the Committee may establish minimum, target and
maximum achievement levels for any Performance Metric.


C.           
Earned Individual Award.  The Committee will assess performance
against (1) any Company-based Performance Metrics, (2) any Business/Functional
Segment-based Performance Metrics and (3) for Participants who are under the
purview of the Committee, any Individual-based Performance Metrics, in each
case, as soon as practicable following a Performance Year.  For any
Participants who are not under the purview of the Committee, such Participant’s
manager (in accordance with the then-current performance management process, if
any) will assess performance against his or her Individual-based Performance
Metrics, if applicable.  Each Participant’s Earned Individual Award will
be determined by the extent to which the Performance Metrics applicable to the
Plan Year have been attained.  The Committee may provide that an Earned
Individual Award may not exceed a certain percentage of the Individual Target
Award.  In addition, in no event will the aggregate Earned Individual Awards
for a Performance Year exceed the Earned Bonus Pool.


 







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D.          
Vesting; Payment.  Earned Individual Awards for a Performance
Year will be granted as the Committee determines in its sole discretion and
paid on such date or dates following the determination process described
in Section 5.C, but no later than April 30th following
the Performance Year (the “Award Date”).  A Participant must be
employed on the Award Date to be eligible to receive his or her Earned
Individual Award except to the extent provided in Section 6  and Appendix B. 
Prior to March 31st of a Performance Year, the Committee may
determine that all or a specified percentage of a Participant’s Earned
Incentive Award will be a “Deferred Award,” in which case such
Earned Incentive Award will be paid on the one-year anniversary of the Award
Date (the “Deferred Award Payment Date”). 


6.           
 Termination
in Service; Breaks in Service


A.           
Termination Generally.  In the event (i) a Participant’s
Employment is Terminated for any reason during the Performance Year or prior to
the Award Date or (ii) a Participant is Employed but not actively performing
services for the Company for a portion of the Performance Year or on the Award
Date for certain reasons specified in Appendix B, the amount and
payment of the Earned Individual Award, if any, that the Participant will
receive will be determined (and, if applicable, modified) in accordance with Appendix
B. 


B.           
Termination without Cause.  In the event that a Participant is
involuntarily Terminated without Cause, AIG will require the Participant to
execute a Release in order to impose restrictive covenants requiring
confidentiality of information, non-disparagement and non-solicitation of
Company employees for 12 months following the termination as a condition
to receiving payment of all or a portion of an Earned Individual Award for
which the Award Date has not occurred as of such termination.  The Release must
be executed by the Participant, submitted to the Company and become irrevocable
prior to the date on which any such Earned Individual Award shall be paid, but
in no event shall the Release be executed later than March 10th of
the year following the year in which the Termination without Cause occurred; provided
that if the Release is executed after such time, any payments with respect
to the Earned Individual Award will be forfeited.


7.           
 Clawback/Repayment.


Notwithstanding anything to the
contrary herein, in consideration of the grant of an Incentive Award, the award
and any payments under this Plan will be subject to forfeiture and/or repayment
to the extent provided for in the AIG Clawback Policy, as in effect from time
to time.


8.           
 Administration


A.           
General.  The Plan will be administered by the Committee, and any
person or persons designated by the Committee to administer the Plan from time
to time including, but not limited to, the Senior C&B Executive and the
Compensation COE.  The Compensation COE will conduct validation analyses to
determine that this Plan is generally operated in accordance with the terms of
this Plan and the applicable Administrative Guide.  Actions of the Committee
may be taken by the vote of a majority of its members.  The Committee may
allocate among its members 







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and delegate to any person
who is not a member of the Committee any of its powers, responsibilities or
duties under the Plan.  The Committee will have the power to construe,
interpret and implement this Plan, to make regulations for carrying out its
purposes and to make all other determinations in connection with its
administration, all of which will, unless otherwise determined by the
Committee, be final, binding and conclusive.  The Committee may, in its sole
discretion, reinstate any Earned Individual Awards made under this Plan that
have been terminated and forfeited because of a Participant’s Termination, if
the Participant complies with any covenants, agreements or conditions that the
Committee may impose; provided,  however, that payment under such
reinstated awards will not be made until the scheduled times set forth in this
Plan.


B.           
Determination of Employment.  The Committee, with respect to any
Participant under the purview of the Committee, and the Senior C&B
Executive, with respect to any other Participant, will have the right to
determine the commencement or Termination date of a Participant’s Employment
with the Company solely for purposes of this Plan, separate and apart from any
determination as may be made by the Company with respect to the individual’s
employment.


C.           
No Liability.  No member of the Board of Directors of AIG (the “Board”)
or any employee of AIG performing services with respect to the Plan (each, a “Covered
Person”) will have any liability to any person (including any
Participant) for any action taken or omitted to be taken or any determination
made, in each case, in good faith with respect to this Plan or any
Participant’s participation in it.  Each Covered Person will be indemnified and
held harmless by AIG against and from any loss, cost, liability, or expense
(including attorneys’ fees) that may be imposed upon or incurred by such
Covered Person in connection with or resulting from any action, suit or
proceeding to which such Covered Person may be a party or in which such Covered
Person may be involved by reason of any action taken or omitted to be taken
under this Plan and against and from any and all amounts paid by such Covered
Person, with AIG’s approval, in settlement thereof, or paid by such Covered
Person in satisfaction of any judgment in any such action, suit or proceeding
against such Covered Person, provided  that  AIG will have the
right, at its own expense, to assume and defend any such action, suit or
proceeding and, once AIG gives notice of its intent to assume the defense, AIG
will have sole control over such defense with counsel of AIG’s choice.  To the
extent any taxable expense reimbursement under this paragraph is subject to
Section 409A, (1) the amount thereof eligible in one taxable year shall not
affect the amount eligible in any other taxable year; (2) in no event shall any
expenses be reimbursed after the last day of the taxable year following the
taxable year in which the Covered Person incurred such expenses; and (3) in no
event shall any right to reimbursement be subject to liquidation or exchange
for another benefit.  The foregoing right of indemnification will not be
available to a Covered Person to the extent that a court of competent
jurisdiction in a final judgment or other final adjudication, in either case,
not subject to further appeal, determines that the acts or omissions of such
Covered Person giving rise to the indemnification claim resulted from such
Covered Person’s bad faith, fraud or willful misconduct.  The foregoing right
of indemnification will not be exclusive of any other rights of indemnification
to which Covered Persons may be entitled under AIG’s Amended and Restated
Certificate of Incorporation or Bylaws, as a matter of law, or otherwise, or
any other power that AIG may have to indemnify such persons or hold them
harmless.


 







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D.          
Consent.  If the Committee at any time determines, in its sole
discretion, that any consent (as hereinafter defined) is necessary or desirable
as a condition of, or in connection with, the granting of any award or the
payment of any amount under this Plan or the taking of any other action
thereunder (each such action, a “plan action”), then such plan
action will not be taken, in whole or in part, unless and until such consent
will have been effected or obtained to the full satisfaction of the Committee; provided 
that  if such consent has not been so effected or obtained as of the
latest date provided by this Plan for payment of such amount and further delay
is not permitted in accordance with the requirements of Section 409A, such
amount will be forfeited and terminate notwithstanding any prior earning or vesting. 



The term “consent” as used in this
paragraph with respect to any plan action includes (1) any and all listings,
registrations or qualifications in respect thereof upon any securities exchange
or under any federal, state, or local law, or law, rule or regulation of a
jurisdiction outside the United States, (2) any other matter, which the
Committee may deem necessary or desirable to comply with the terms of any such
listing, registration or qualification or to obtain an exemption from the
requirement that any such listing, qualification or registration be made, (3)
any and all other consents, clearances and approvals in respect of a plan
action by any governmental or other regulatory body or any stock exchange or
self-regulatory agency and (4) any and all consents required by the Committee.


9.           
 Other Provisions


A.           
No Funding.  The Company will be under no obligation to fund or
set aside amounts to pay obligations under this Plan. A Participant will have
no rights to awards or other amounts under this Plan other than as a general,
unsecured creditor of the Company.


B.           
Tax Withholding.  The Company will comply with all applicable tax
reporting, withholding and other requirements globally with respect to amounts
paid under this Plan, in amounts and in a manner determined in the sole
discretion of the Company.  As a condition to the payment of any amount under
this Plan, or in connection with any other event related to this Plan, that
gives rise to a federal or other governmental tax withholding obligation (1)
the Company may deduct or withhold (or cause to be deducted or withheld) from
any payment to a Participant whether or not pursuant to this Plan or (2) the
Committee will be entitled to require that the Participant remit cash to the
Company (through payroll deduction or otherwise), in each case, in an amount
sufficient in the opinion of the Company to satisfy such withholding
obligation.


C.           
No Rights to Other Payments.  The provisions of this Plan provide
no right or eligibility to a Participant to any other payouts from AIG or its
subsidiaries under any other alternative plans, schemes, arrangements or
contracts AIG may have with any employee or group of employees of AIG or its
subsidiaries.  Nothing contained in the Plan will be deemed in any way to limit
or restrict the Company from adopting or continuing in effect any compensation
arrangements or making any award or payment to any person under any other plan,
arrangement or understanding, whether now existing or hereafter in effect.


 







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D.          
Effect on Benefit Plans.  The Incentive Award payment is deemed
compensation under certain of the Company’s compensation and benefit plans, but
it is not deemed compensation for other programs; provided, however, that for
purposes of the Company’s benefit programs, this Plan will be deemed a
short-term incentive, annual, year-end bonus program. The Summary Plan
Description and plan summaries of each of the Company’s compensation and
benefit plans will govern whether and the extent to which the Incentive Award
payment will affect the Participant’s benefits under such plans, and the
Company reserves the right to amend those compensation and benefit plans at any
time.


E.           
Section 409A.  Payments under this Plan are intended to be exempt
from Section 409A to the extent they satisfy the “short-term deferral
exception” in Treasury Regulation Section
1.409A-1(b)(4) and otherwise to be compliant with Section 409A, and this
Plan shall be interpreted, operated and administered accordingly.  For the avoidance of doubt, all Incentive Awards under the
Plan other than Deferred Awards are intended to satisfy the short-term deferral
exception and all Deferred Awards constitute “deferred compensation” subject to
Section 409A.  With respect to any Incentive Award that constitutes
“deferred compensation” subject to Section 409A, (1) references to termination
of the Participant’s employment will mean the Participant’s separation from
service with the Company within the meaning of Section 409A and (2) any payment
to be made with respect to such Incentive Award in connection with the
Participant’s separation from service with the Company within the meaning of
Section 409A that would be subject to the limitations in Section 409A(a)(2)(b)
of the Code will be delayed until six months after the Participant’s separation
from service (or earlier death) in accordance with the requirements of Section
409.  Each payment made under the Plan will be deemed
to be a separate payment for purposes of Section 409A.  The Committee
will have full authority to give effect to the intent of this Section 9.E. 


F.           
Section 4999.  In the event that any Incentive Award payment
received or to be received by any Participant under this Plan would be subject
to the excise tax imposed by Section 4999 of the Code or any similar or
successor provision to Section 4999 (the “Excise Tax”) then, at
the discretion of the Chief Human Resource Officer, such Incentive Award
payment shall be reduced up to the largest amount which would result in no
portion of the Incentive Award payment being subject to the Excise Tax.  The
determination of any such reduction pursuant to this Section 9.F will be
made by the Senior C&B Executive, and such determination will be conclusive
and binding upon the Company, the Participant, the Senior C&B Executive and
the Committee for all purposes.


G.          
Section Headings.  The section headings contained herein are for
convenience only, and in the event of any conflict, the text of the Plan,
rather than the headings will control.


H.          
Severability.  If any term or provision contained herein is
finally held to be, to any extent, invalid, illegal or unenforceable (whether
in whole or in part), such provision will be deemed modified only to the extent
of such invalidity, illegality or unenforceability and the remaining provisions
will not be affected thereby.


I.            
No Third Party Beneficiaries.  Except as expressly provided
herein, this Plan will not confer on any person other than AIG and the
Participant any 







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rights or remedies hereunder. The
exculpation and indemnification provisions of Section 8.C will inure to
the benefit of a Covered Person’s estate and beneficiaries and legatees.


J.           
Nonassignability.  No award (or any rights and obligations
thereunder) granted to any person under the Plan may be sold, exchanged,
transferred, assigned, pledged, hypothecated or otherwise disposed of or
hedged, in any manner (including through the use of any cash-settled
instrument), whether voluntarily or involuntarily and whether by operation of
law or otherwise, other than by will or by the laws of descent and
distribution, except as may be otherwise provided in the award agreement.  Any
sale, exchange, transfer, assignment, pledge, hypothecation, or other
disposition in violation of the provisions of this Section 9.J  will
be null and void and any award which is hedged in any manner will immediately
be forfeited.  All of the terms and conditions of this Plan and the award
agreements will be binding upon any permitted successors and assigns.


K.           
Entire Understanding.  The Plan and, with respect to a
Performance Year, the applicable Administrative Guide, contains the entire
understanding of the Company and the Participants with respect to the subject
matter thereof and supersedes all prior promises, covenants, arrangements,
agreements, communications, representations and understanding between the
Company and the Participant.


L.           
No Right of Employment.  Nothing in this Plan will be construed
as creating any contract of employment or conferring upon the Participant any
right to continue in the employ or other service of the Company, or any of its
subdivisions or subsidiaries, or limit in any way the right of the Company to
change such Participant’s compensation or benefits or to terminate the
employment or other service of such Participant with or without Cause.


M.          
Successor and Assigns.  The terms of this Plan will inure to the
benefit of AIG and any successor entity.


N.           
Subject to Any AIG Section 162(m) Plan.   AIG may, in any
year, propose a Section 162(m) compliant
performance incentive award plan (the “AIG Section 162(m) Plan”). 
If an AIG Section 162(m) Plan is proposed and approved by the AIG stockholders
in accordance with Section 162(m)(4)(C) of the Code and Treasury Regulation
Section 1.162‐27(e)(4), this Plan will function as a sub-plan under the
AIG Section 162(m) Plan, whereby performance compensation amounts payable under
the AIG Section 162(m) Plan can be paid in part by accruing awards with respect
to a Performance Year.


O.          
No Liability With Respect to Tax Qualification or Adverse Tax
Treatment.  Notwithstanding anything to the contrary contained herein, in
no event shall the Company be liable to a Participant on account of the failure
of any Incentive Award or amount payable under this Plan to (a) qualify
for favorable United States or foreign tax treatment or (b) avoid adverse tax
treatment under United States or foreign law, including, without limitation,
Section 409A.


 







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10.        
 Governing Law.


The Plan will be governed and
enforced in accordance with the appropriate country and local regulations. 
With respect to Participants working in the United States, this Plan will be
governed by and construed in accordance with the laws of the State of New York,
without regard to principles of conflict of laws.


The Plan shall also be subject to
all applicable non-U.S. laws as to Participants located outside of the United
States. In the event that any provision of this Plan is not permitted by the
local laws of a country or jurisdiction in which a Participant works, such
local law shall supersede that provision of this Plan with respect to that
Participant.  The  Senior HR Attorney and the Senior C&B Executive or their
designee(s) shall have the discretion to operate the Plan with respect to such
Participant in a manner that incorporates as much of the Plan’s current terms
as possible while also complying with such local laws.


11.        
 Plan Termination; Amendment


The Plan may be amended or
modified, with or without prior notification of the Participants, at any time
in the sole discretion of the Committee.  The Plan will continue until
suspended or terminated by the Committee in its sole discretion; provided
that all Incentive Awards made under the Plan before its suspension or
termination will remain in effect until such awards have been satisfied or
terminated in accordance with the terms and provisions of the Plan and the
applicable award.  Any termination of this Plan will be done in a manner that
the Committee determines complies with Section 409A. 


Notwithstanding the foregoing,
the Committee’s rights and powers to amend the Plan shall be delegated to the
Senior C&B Executive, who shall have the right to amend the Plan with
respect to (i) amendments required by relevant law, regulation or ruling, (ii)
amendments that are not expected to have a material financial impact on the
Company, (iii) amendments that can reasonably be characterized as technical or
ministerial in nature or (iv) amendments that have previously been approved in
concept by the Committee.  Notwithstanding the foregoing delegation, the Senior
C&B Executive shall not have the power to make an amendment to the Plan
that could reasonably be expected to result in a termination of the Plan or a
change in the structure or the powers, duties or responsibilities of the
Committee, unless such amendment is approved or ratified by the Committee.


12.        
 Effective Date


The Plan is effective as of the 2014 Performance Year,
and will continue thereafter until terminated by the Committee; provided,
however, that the existence of the Plan at any time or from time to time
does not guarantee or imply the payment of any Incentive Awards hereunder, or
the establishment of any future plans or the continuation of this Plan. 
















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Appendix A








Glossary of Terms


“AIG” means American International Group, Inc.


“AIG Section 162(m) Plan” means a Section 162(m) compliant performance incentive award plan.


“Award Date” means the date, in accordance with Section
5.D, that the Incentive Award is granted to and becomes non-forfeitable
(other than with respect to the clawback provisions of Section 7 of the
Plan) to the Participant.  For point of clarity, for Participants with an
Incentive Award of which a portion is designated as a Deferred Award (with such
portion payable in a year later than the year following the Performance Year),
the Award Date is the date the entire Incentive Award becomes non-forfeitable
and that the portion of the Incentive Award not  designated as a Deferred
Award is paid.  For all others, the Award Date is the date that the entire
Incentive Award is paid.


“Board” means the Board of Directors of AIG.


“Breaks in Service” means the cessation of actively
performing services for the Company, either on a temporary or permanent basis
(including Resignation, Termination, Leaves of Absence, Retirement and Death). 
See Appendix B for more information.


“Business/Functional Segments” means the business unit
segments and functional unit segments established by the Committee for a
Performance Year.  


“Cause” has the meaning provided in the applicable
severance plan, program or other arrangement in which the Participant is
eligible to participate; provided  that, to the extent that the
Committee, with respect to any Participant under the purview of the Committee,
or the Senior C&B Executive, with respect to any other Participant, or
their delegate(s), in each case, in its or his or her sole discretion
determines that the Participant is not eligible to participate in a severance plan,
program or arrangement, “Termination without Cause” shall mean a Termination
due to a reduction in force, position elimination or office closing.


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


“Committee” means the Compensation and Management Resources
Committee of the Board of Directors of AIG (including any successor thereto).


“Company” means AIG together with its consolidated
subsidiaries.


“Compensation COE” means the Compensation Center of
Excellence.


“Covered Person” means any employee of AIG performing
services with respect to the Plan.


“Deferred Award” means all or a specified percentage of a
Participant’s Earned Incentive Award that the Committee determines, prior to
March 31st of a Performance Year, will be paid on the Deferred Award
Payment Date.


“Deferred Award Payment Date” means the one-year
anniversary of the Award Date.









 


















 








“Earned Bonus Pool” means the
actual bonus pool approved by the Committee under this Plan for a Performance
Year.


“Earned Individual Award” means a Participant’s actual Incentive
Award.


“Employed” and “Employment” means (a)
actively performing services for the Company, (b) being on a Company-approved
leave of absence, whether paid or unpaid, or (c) receiving long term disability
benefits for up to three years from the date short term disability leave
commenced, in each case while in good standing with the Company.


“Excise Tax” means the excise tax imposed by Section 4999
of the Code or any similar or successor provision to Section 4999.


 “Incentive Award” means an award under this Plan.


“Individual Target Award” means a Participant’s target
Incentive Award.


“Normal Schedule” means the date specified in Section
5.D that an Incentive Award would otherwise have been paid if the
Participant had continued to remain Employed by the Company. 


“Operating Committee” means the group of senior executives
selected by the President and CEO to be a member of this deliberative group.


“Paid Leave of Absence” means an approved leave of absence
during which the Participant is receiving salary continuation from a Company
payroll.


“Participant” has the meaning provided in Section 3. 


“Performance Metric” means a performance metric determined
by the Committee prior to or as soon as practicable following the commencement
of a Performance Year in accordance with Section 5.B. 


“Performance Year” means each successive one-year periods
beginning on January 1 of each year.


“Plan” means this American International Group, Inc. Annual
Short-Term Incentive Plan (also referred to as “Compensation Plan 483”).


“Pro-Rated” means, for any amount under this Plan,
multiplying such amount by a fraction, the numerator of which is the number of
months (rounding up for partial months) during the Performance Year that the
Participant actively performed services for the Company (including any period
designated by the Company as “working notice”) or was on a Paid Leave of
Absence, and the denominator of which 12.


“Release” means the release required by the severance plan
or program applicable to the Participant’s Termination without Cause; provided
that, to the extent that no such established severance plan or program is
deemed applicable by the Committee, with respect to any Participant under the
purview of the Committee, or the Senior C&B Executive, with respect to any
other Participant, or their delegate(s), in each case, in its or his or her
sole discretion, then the release will be a release generally in the form set
forth in Appendix C, subject to any provisions that the Senior HR
Attorney and the Senior C&B 







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Executive or their
delegate(s) may amend or add to the release; provided, further, that if
the local laws of a country or non-U.S. jurisdiction in which the Participant
performs services would not permit all or a portion of the release in Appendix
C to be structured or executed in the applicable form attached hereto, the Senior
HR Attorney and the Senior C&B Executive or their designee(s) shall have
the discretion to create a release that incorporates as much of the release in
the form attached as Appendix C as possible while also complying with
such local laws.


“Retirement” or “Retire” means, solely for
purposes of this Plan, (i) in the United States, voluntary Termination
initiated by the Participant (while such Participant is in good standing with
the Company) (x) on or after age 60 with five years of service or (y) on or
after age 55 with 10 years of service, and (ii) outside of the United States, a
Participant’s  termination of employment after the Participant has achieved
certain service and/or age milestones in accordance with the local policy on
retirement for the entity that employs such Participant.


“Section 409A” means Section 409A of the Code, including
any amendments or successor provisions to that section, and any regulations and
other administrative guidance relating thereto, in each case as they may be
from time to time amended or interpreted through further administrative
guidance.


“Senior C&B Executive”  means the Company’s most senior executive
whose responsibility it is to oversee both the Corporate Compensation
Department and the Corporate Benefits Department.  In
the event that no individual holds such position, “Senior C&B Executive”
will instead refer to the Company’s most senior executive whose responsibility
it is to oversee the global Human Resources Department.


“Senior HR Attorney”  means
the Company’s most senior attorney whose responsibility it is to oversee Human
Resource/employment matters.


“Termination” or “Terminate,” with respect to
a Participant, means the termination of the Participant’s Employment.


“Threshold Goal” has the meaning provided in Section 4. 


“Unpaid Leave of Absence” means an approved leave of
absence during which the Participant is not receiving salary continuation from
a Company payroll, including a period of long term disability leave during
which a Participant may be receiving long term disability insurance payments
from a long term disability insurer.


  
















-11-




 


















Appendix B








Treatment of Incentive
Awards Upon Various Types of Breaks in Service or

Terminations of Employment


	
   Type of Break
   in Service or Termination of Employment

   	
   Amount the
   Participant Receives

   
	
  Short-Term &
  Long-Term Medical Leaves of Absence 

  (STD & LTD)

  Family Medical
  & Domestic Partner Leave

  Non-Medical Leave
  of Absence

  (Personal Leave)

  Military Leave of
  Absence

  	
  If a Participant is on an approved leave
  of absence during which the Participant is receiving salary continuation from
  a Company payroll (a “Paid Leave of Absence”), such Paid Leave
  of Absence will not be deemed a break a service or a Termination for purposes
  of this Plan. Time on a Paid Leave of Absence will be treated the same as
  time during which the Participant performs services for the Company.

   

  If a Participant is on an approved leave
  of absence during which the Participant is NOT receiving salary continuation
  from a Company payroll, including a period of long term disability leave
  during which a Participant may be receiving long term disability insurance
  payments from a long term disability insurer (an “Unpaid Leave of
  Absence”), his or her Incentive Award will be Pro-Rated based on the
  number of months during the Performance Year that the Participant was
  actively employed (prior to the Participant’s last day worked) or on a Paid
  Leave of Absence with the Company, but will not include the number of months
  that the Participant was on an Unpaid Leave of Absence.

   

  Incentive Awards are paid on the Normal Schedule.

   

  
	
  Retirement

  	
  If a Participant Retires During the Performance
  Year, after March 31st and before the End of the
  Performance Year:  

  ·        
  The Incentive Award is Pro-Rated based on the number of months
  during the Performance Year that the Participant was actively employed (prior
  to the Participant’s last day worked) or on a Paid Leave of Absence with the
  Company and,

  ·        
  The amount of the Incentive Award is based on 100% of the
  Participant’s Individual Target Award for such Performance Year and, 

  ·        
  To the extent applicable for such Performance Year, actual
  performance against the Company-based Performance Metrics and the
  Business/Functional Segment-based Performance Metrics as determined by the
  Committee. 

  ·        
  Paid on the Normal Schedule. 

   

  If a Participant Retires on or before March 31st
  of the Performance Year:

  ·        
  Participant will not receive any Pro-Rated Incentive Award
  payment for the current Performance Year.

   

   

  If a Participant Retires
  After the End of the Performance Year but prior to the Award Date: 
   

  ·        
  The Incentive Award is not Pro-Rated, but is paid in full based
  on, to the extent applicable for such Performance Year, actual performance
  against the Individual-based Performance Metrics, the Company-based
  Performance Metrics and the Business/Functional Segment-based Performance
  Metrics for such Performance Year. 

  ·        
  Paid on the Normal Schedule.

   

  
	
  Death

  	
  If a Participant Dies During the Performance Year,
  after March 31st and before the End of the Performance Year:  

  ·        
  The Incentive Award is Pro-Rated based on the number of months
  during the Performance Year that the Participant was actively employed (prior
  to the Participant’s last day worked) or on a Paid Leave of Absence with the
  Company and the amount of the Incentive Award is based on 100% of the
  Participant’s Individual Target Award for such Performance Year. 

  ·        
  Paid as soon as administratively possible after the date of
  death, but in no event later than March 15th following such
  Performance Year. 

   

  If a Participant Dies on or before March 31st
  of the Performance Year:

  ·        
  The Participant will not receive any Pro-Rated Incentive Award
  payment for the current Performance Year.

   

  If a Participant Dies After the End of the
  Performance Year but prior to the Award Date:

  ·        
  The Incentive Award is not Pro-Rated, but is paid 100% of the
  Individual Target Award in effect on the date of death. 

  ·        
  Paid as soon as administratively possible after the date of
  death, but in no event later than March 15th following the year in which the
  death occurred.

  
	
  Resignation,
  Voluntary Quit, Constructive Discharge

  	
  If the last day the Participant was actively performing
  services for the Company (the Participant’s last day worked) or on a Paid
  Leave of Absence is prior to the Award Date, the Incentive Award is
  forfeited.  

  
	
  Termination without
  Cause

   

  	
  If a Participant Experiences a Termination without
  Cause: 

  For Participants in the 2012 Executive Severance Plan or
  its successor plan, paid in accordance with such plan.  

   

  For all other Participants, payable pursuant to the AIG,
  Inc. Severance Plan, or other severance arrangement applicable to such
  Termination without Cause as follows:  

   

   

  Termination without Cause
  During the Performance Year

  ·        
  If the last day that the Participant was actively performing
  services for the Company (the Participant’s last day worked) or on a Paid
  Leave of Absence occurs after March 31st and before the end of the
  Performance Year, the Participant will receive 80% of the Participant’s
  Individual Target Award with respect to such Performance Year Pro-Rated based
  on the number of months during the Performance Year that the Participant was
  actively performing services for the Company (prior to the Participant’s last
  day worked) or on a Paid Leave of Absence. 

  ·        
  For the avoidance of doubt, if the last day that the
  Participant was actively performing services for the Company or on a Paid
  Leave of Absence occurs on or before March 31st of a Performance
  Year, the Participant will not receive any Incentive Award payment for such
  Performance Year.

   

  Termination without Cause After the End of the
  Performance Year but prior to the Award Date

  ·        
  If the last day that the Participant was actively performing
  services for the Company (the Participant’s last day worked) or on a Paid
  Leave of Absence occurs after the end of the Performance Year, but prior to
  the Award Date for such Performance Year, the Participant will receive 80% of
  the Participant’s Individual Target Award with respect to such Performance
  Year.

   

  Timing of Payments  

  ·        
  Paid as soon as administratively possible after the date of
  Termination without Cause, but no later than March 15th following
  the year in which the Termination without Cause occurs, and in no event later
  than when other actively employed Participants are
  paid similar Incentive Awards under the Plan; provided that any
  Deferred Award will be paid on the Normal Schedule.   

  To the extent there is an inconsistency between this Plan
  and the applicable severance program, the severance program will prevail. To
  the extent the Committee, with respect to any Participant under the purview of
  the Committee, or the Senior C&B Executive, with respect to any other
  Participant, or their delegate(s), in each case, in its or his or her sole
  discretion determines that no established severance program or arrangement is
  applicable to a Participant’s Termination without Cause, then, in accordance
  with Section 6.B, the Participant will need to execute a release
  generally in the form set forth in Appendix C, subject to any
  provisions that the Senior HR Attorney and the Senior C&B Executive  or
  their delegate(s) may amend or add to the release.

  












 


















 








Form of Release Referred to in Section 6.B of the Plan


NOT
personalized to each Participant.


(1)          
[Employee Name] (“Employee”), for good and sufficient
consideration, the receipt of which is hereby acknowledged, hereby waives and
forever releases and discharges any and all claims of any kind Employee may
have against American International Group, Inc., its affiliate or subsidiary
companies, or any officer, director or employee of, or any benefit plan
sponsored by, any such company (collectively, the “Released Parties”)
which arise from Employee’s employment with any of the Released Parties or the
termination of Employee’s employment with any of the Released Parties. 
[Specifically, but without limiting that release, Employee hereby waives any
rights or claims Employee might have pursuant to the Age Discrimination in
Employment Act of 1967, as amended (the “Act”) and under the laws
of any and all jurisdictions, including, without limitation, the United
States.  Employee recognizes that Employee is not waiving any rights or claims
under the Act that may arise after the date that Employee executes this
Release.] Nothing herein modifies or affects any vested rights that Employee
may have under the [American International Group, Inc. Retirement Plan, or the
American International Group, Inc. Incentive Savings Plan] [and other plans
applicable to Employee]; nor does this Release confer any such rights,
which are governed by the terms of the respective plans (and any agreements
under such plans).


(2)          
Employee acknowledges that Employee has not filed any complaint, charge,
claim or proceeding, if any, against any of the Released Parties before any
local, state or federal agency, court or other body (each individually a “Proceeding”). 
Employee represents that Employee is not aware of any basis on which such a
Proceeding could reasonably be instituted.


(3)          
Confidentiality/Non-Disclosure.  During the term of Employee’s
employment, the Company permitted Employee to have access to and become
acquainted with trade secret information of a confidential, proprietary or
secret nature.  Subject to and in addition to any confidentiality or
non-disclosure requirements to which Employee was subject prior to the date the
Employee executes this Release, effective as of the date Employee executes this
Release, Employee acknowledges and agrees that (i) all confidential,
proprietary, trade secret information received, obtained or possessed at any
time by Employee concerning or relating to the business, financial,
operational, marketing, economic, accounting, tax or other affairs at the
Company or any client, customer, agent or supplier or prospective client,
customer, agent or supplier of the Company will be treated by Employee in the
strictest confidence and will not be disclosed or used by Employee in any
manner without the prior written consent of the Company or unless required by
law, and ii) Employee  has not during the term of Employee’s employment and
will not remove or destroy any such confidential information.


(4)          
Non-Solicitation.  Employee acknowledges and agrees that Employee’s
employment with the Company required exposure to and use of confidential trade
secret information (as set forth in Paragraph 3).  Subject to and in
addition to any non-solicitation requirements to which Employee was subject
prior to the date Employee executes this Release, effective as of the date
Employee executes this Release, Employee acknowledges and agrees that (i)
Employee will not, directly or indirectly, on
Employee’s own behalf or on behalf of any other person or entity 







-15-




 


















Appendix C








solicit, contact, call upon, communicate with or attempt
to communicate with any customer or client or prospective customer or client of
the Company where to do so would require the use or disclosure of trade secret
information, and (ii) for a period of one (1) year after employment terminates
for any reason, Employee will not solicit or in any manner encourage or provide
assistance to any employee, consultant or agent of the Company to terminate his
or her employment or other relationship with the Company or to leave its employ
or other relationship with the Company for any engagement in any capacity or
any other person or entity.


(5)          
Non-Disparagement.  Employee acknowledges and agrees that Employee
will not disparage AIG or any of its subsidiaries or affiliates or any of their
officers, directors or employees to any person or entity not affiliated with
AIG; provided, however, that nothing herein prohibits the Employee from giving
truthful testimony as required by law.


(6)          
Employee agrees that AIG’s remedies at law for a breach or threatened
breach of Section 3, 4 and 5 of this Release would be inadequate.  In
recognition of this fact, Employee agrees that, in the event of such a breach
or threatened breach, in addition to any remedies at law, AIG, without posting
any bond, shall be entitled to obtain equitable relief from a court of
competent jurisdiction the form of specific performance, temporary restraining
order, temporary or permanent injunction or any other equitable remedy which
may then be available in the event of a breach or threatened breach of such
provision. 


(7)          
[Employee acknowledges and understands that Employee is hereby being
advised to consult with an attorney prior to executing this Release.  Employee
also acknowledges and understands that Employee has twenty-one (21) days to
consider the terms of this Release before signing it.  However, in no event may
Employee sign this Release before Employee’s termination date.]


(8)          
[Upon the signing of this Release by Employee, Employee understands that
Employee shall have a period of seven (7) days following Employee’s signing of
this Release in which Employee may revoke this Release.  Employee understands
that this Release shall not become effective or enforceable until this seven
(7) day revocation period has expired, and that neither the Released Parties
nor any other person has any obligation [pursuant to the American International
Group, Inc. Annual Short-Term Incentive Plan] until eight (8) days have
passed since Employee’s signing of this Release without Employee having revoked
this Release.  If Employee revokes this Release, Employee will be deemed not to
have accepted the terms of this Release.]












 


















 








 


 


(9)          
Any dispute arising under this Release shall be governed by the [law of
the State of New York], without reference to the choice of law rules that would
cause the application of the law of any other jurisdiction.


	
   

  	
   

  	
   

  
	
  
   

  

  	
   

  	
  
   

  

  
	
   

  	
   

  	
   

  
	
  DATE

  	
   

  	
  [Employee]

  





 











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