EX-10.1






Exhibit 10.1




SERIES C PERPETUAL, CONVERTIBLE, PARTICIPATING PREFERRED STOCK

PURCHASE AGREEMENT




          SERIES C PERPETUAL, CONVERTIBLE, PARTICIPATING PREFERRED STOCK PURCHASE AGREEMENT (this
“Agreement”), dated as of March 1, 2009, between AIG CREDIT FACILITY TRUST, a trust
established for the sole benefit of the United States Treasury (the “Trust”), and AMERICAN
INTERNATIONAL GROUP, INC., a Delaware corporation (the “Company”). In this Agreement,
references to the Trust shall include the Trustees acting in their capacities as such trustees as
the context may require. Reference is made to Article 1 below for the meaning of certain
capitalized terms used herein.




Background




          A. Pursuant to Section 13(3) of the Federal Reserve Act, 12 U.S.C. § 343, the Board of
Governors of the Federal Reserve System determined that unusual and exigent circumstances existed
both with respect to the financial condition of the Company and its likely impact on the nation’s
economic stability, and the stability of the nation’s financial and banking systems, and authorized
the Federal Reserve Bank of New York (the “FRBNY”), subject to certain conditions, to
extend credit to the Company pursuant to a credit agreement, dated as of September 22, 2008,
between the Company and the FRBNY (as amended from time to time, the “Credit Agreement”).




          B. The Company is obligated under the Credit Agreement to issue the Shares (as defined below)
to the Trust for the sole benefit of the United States Treasury, and the issuance of the Shares to
the Trust is intended to provide compensation for the assumption of the risks arising from the
Credit Agreement and to reduce those risks.




          C. Pursuant to Section 5.11 of the Credit Agreement, the Company and the Trust are entering
into this Agreement because the FRBNY has determined that this Agreement is necessary to effect the
issuance of the Shares.




          THEREFORE, the parties hereto agree as follows:




Terms and Conditions




1. DEFINITIONS




          Capitalized terms used and not defined in this Agreement shall have the meanings set forth in
the Credit Agreement.




          As used in this Agreement, the following terms shall have the meanings set forth below:



“Charter” means the Company’s Restated Certificate of Incorporation, as amended from time to time.



“Common Stock” has the meaning set forth in the Certificate of Designations (as defined in Section
3.2 below).



“Effective Date” means the date on which this Agreement shall have been executed and delivered by
all of the parties hereto.




 









 







“Equity Units” means the Equity Units issued by the Company pursuant to the Purchase Contract
Agreement.



“Person” means any individual, corporation, limited liability company, partnership, joint venture,
association, joint-stock company, trust, estate, unincorporated organization, government or
political subdivision thereof, government agency or instrumentality, or any other entity
whatsoever.



“Purchase Contract Agreement” means the Purchase Contract Agreement dated May 16, 2008 between the
Company and The Bank of New York.



“Securities Act” means the Securities Act of 1933, as amended from time to time.



“Series C Preferred Stock” means the Series C Perpetual, Convertible, Participating Preferred Stock
of the Company, the Certificate of Designations for which is substantially in the form of Exhibit A
hereto.



“Series D Preferred Stock” means the Series D Fixed Rate Cumulative Perpetual Preferred Stock of
the Company.



“Series D Preferred Stock Purchase Agreement” means the Securities Purchase Agreement dated as of
November 25, 2008, between the Company and United States Department of the Treasury.



“Underlying Shares” mean shares of Common Stock or other securities issuable upon conversion of the
Series C Preferred Stock.



“SEC” means the U.S. Securities and Exchange Commission or any successor thereto.



“Trustees” means the trustees of the Trust acting in their capacities as such trustees.



“Warrant” means the warrant issued by the Company to the United States Department of the Treasury
concurrently with the issuance of the Series D Preferred Stock.




2. PURCHASE OF SERIES C PREFERRED STOCK




     2.1. Agreement to Sell and Purchase. On the basis of the representations and warranties
contained in this Agreement, on the Closing Date the Company shall issue and sell to the Trust, and
the Trust shall purchase (the “Purchase”) from the Company, 100,000 (one hundred thousand)
shares of Series C Preferred Stock, par value $5.00 per share (the “Shares”), with an
initial liquidation preference equal to $5 (five dollars) per share ($500,000 (five hundred
thousand dollars) liquidation preference in the aggregate), at the purchase price of $500,000 (five
hundred thousand dollars), with an understanding that additional and independently sufficient
consideration was also furnished by FRBNY in the form of its lending commitment under the Credit
Agreement (the “Purchase Price”).



     2.2. Payment and Delivery. Payment of the cash portion of the Purchase Price was made to the
Company by FRBNY at the closing of the Credit Agreement as a credit against a fee payable by the
Company in accordance with Section 4.02(e) of the Credit Agreement. Certificates for the Shares
shall be registered for the sole benefit of the United States Treasury in the name of the Trustees
in their capacities as trustees of the Trust. The certificates evidencing the Shares shall be
delivered to the Trust on the third Business Day immediately succeeding the Effective Date (or
such later date as shall be agreed by the parties hereto) (the “Closing Date”), with any
stock transfer taxes payable in connection with the transfer



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of the Shares to the Trust duly paid.
Such payment and delivery are hereinafter referred to as the “Closing”.




3. CONDITIONS TO PURCHASER’S OBLIGATIONS




          The obligation of the Trust to accept delivery of the Shares on the Closing Date is subject to
the following conditions:




     3.1. The Trust shall have received on the Closing Date a certificate, dated the Closing Date
and signed by the Chief Executive Officer, the President, any Executive or Senior Vice President or
any Vice President and a principal financial or accounting officer of the Company, to the effect
that the representations and warranties of the Company contained in this Agreement are true and
correct, in all material respects, as of the Closing Date and that the Company has complied, in all
material respects, with all of the agreements and satisfied all of the conditions on its part to be
performed or satisfied hereunder on or before the Closing Date.



     3.2. The Company shall have duly adopted and filed with the Secretary of State of the State of
Delaware the Certificate of Designations for the Series C Preferred Stock substantially in the form
of Exhibit A hereto (the “Certificate of Designations”) and such filing shall have been
accepted.



     3.3. The Trust shall have received on the Closing Date an opinion of (i) Sullivan & Cromwell
LLP, special counsel for the Company, dated the Closing Date and in form and substance as set forth
in Exhibit B and (ii) Kathleen E. Shannon, Senior Vice President, Secretary and Deputy General
Counsel of the Company, dated the Closing Date and in form and substance as set forth in Exhibit C.



     3.4. All corporate and other proceedings in connection with the transactions contemplated at
the Closing hereby, and all documents and instruments incident to such transactions, shall be
reasonably satisfactory in substance to the Trust and its counsel.



4. REPRESENTATIONS




          The Company represents and warrants as of the Effective Date and the Closing Date as follows:




     4.1. Organization; Powers. The Company (a) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, (b) has all requisite corporate
power and authority to own its property and assets and to carry on its business, in all material
respects, as now conducted and as proposed to be conducted, (c) is qualified to do business in, and
is in good standing in, every jurisdiction where such qualification is required, except where the
failure so to qualify could not reasonably be expected to result in a Material Adverse Effect and
(d) has the power and authority to execute, deliver and perform its obligations under this
Agreement.



     4.2. Organizational Documents. The Company has made available to the Trust a complete and
correct copy of its Charter and bylaws, each as amended to date (the “Organizational
Documents”). The Organizational Documents are in full force and effect. The Company is not in
violation of any provision of its Organizational Documents.



     4.3. Authorization. The execution, delivery and performance of this Agreement, including the
issuance and delivery of the Shares and the conversion thereof into the Underlying Shares, (a) have
been duly authorized by all requisite corporate and shareholder



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action
(other than the actions contemplated in Sections 6.1, 6.2, 6.3,
6.6, 6.7 (with respect to Board of Director’s approval only) and 6.8
(with respect to clause (ii) of the second sentence only)) and (b) will not to the best knowledge
of the Company after due investigation (i) result in the violation by the Company or any Material
Subsidiary of (A) any provision of law, statute, rule or regulation that is applicable to the
Company, any Material Subsidiary or the transactions contemplated hereby, or of the certificate or
articles of incorporation or other constitutive documents or bylaws of the Company or any Material
Subsidiary, (B) any order of any Governmental
Authority or (C) any provision of any indenture, agreement or other instrument to which the
Company or any Material Subsidiary is a party or by which any of them or any of their property is
or may be bound, (ii) be in conflict with, result in a breach of, terminate or constitute (alone or
with notice or lapse of time or both) a default under, or give rise to any right to terminate or
accelerate or to require the prepayment, repurchase or redemption of any obligation under any such
indenture, agreement or other instrument or (iii) result in the creation or imposition of any Lien
upon or with respect to any property or assets now owned or hereafter acquired by the Company or
any Material Subsidiary, except in the case of clause (b)(i)(A) for any actual or potential
violations disclosed by the Company to the Trust in writing as of the Effective Date and except in
the case of clauses (b)(i), (b)(ii) and (b)(iii) as would not, individually or in the aggregate,
have a Material Adverse Effect or affect the validity of the Series C Preferred Stock.




     4.4. Enforceability. This Agreement has been duly and validly executed and delivered by the
Company and (assuming due authorization, execution and delivery by the Trust) shall constitute the
valid and legally binding obligation of the Company, enforceable against the Company in accordance
with its terms, except that rights to indemnification and contribution may be limited under
applicable law.



     4.5. Valid Issuance. When issued in accordance with the terms of this Agreement, the Series C
Preferred Stock will be duly authorized, validly issued, fully paid and nonassessable, free and
clear of all liens and preemptive rights. The Underlying Shares will be duly and validly reserved
for issuance immediately after the Company’s shareholders approve the Charter Amendment (as defined
in the Certificate of Designations). When issued and delivered in accordance with the terms of
this Agreement and the Series C Preferred Stock, such Underlying Shares will be duly authorized,
validly issued, fully paid and nonassessable, free and clear of all liens and preemptive rights.



     4.6. Governmental Approvals. Assuming the accuracy of the Trust’s representations and
warranties set out in Section 5.1 and Section 5.2 of this Agreement and its compliance with its
obligations hereunder, to the best knowledge of the Company after due investigation, no action,
consent or approval of, registration or filing with or any other action by any Governmental
Authority is or will be required to be taken, obtained or made by the Company or any Material
Subsidiary in connection with this Agreement, except (a) such as have been made or obtained and are
in full force and effect, (b) such as have been disclosed by the Company to the Trust in writing as
of the Effective Date, (c) the filings and registrations
contemplated by Sections 6.2, 6.6, 7.1 and 7.2
hereof and (d) if the failure to take such action, obtain such consent or approval or register or
file with such Governmental Authority could not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect.



5. ACKNOWLEDGMENTS AND AGREEMENTS OF THE TRUST




     5.1. Purchase of Restricted Shares. The Trust acknowledges that the Shares and the Underlying
Shares have not been registered under the Securities Act or under any U.S. federal or state
securities laws. The Trust (a) is acquiring the Shares pursuant to an exemption from registration
under the Securities Act and with no present intention to distribute them to any person in
violation of the Securities Act or any applicable U.S. federal or state securities laws, (b) will
not sell or otherwise dispose of any of the Shares or the Underlying Shares, except in compliance
with the registration requirements or exemption provisions of the Securities Act and any applicable
U.S. federal or state securities laws, and (c) including



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through such advisors that it may retain
or consult, 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.




     
5.2. Legends.




     (a) The Trust agrees that all certificates or other instruments representing the Series C
Preferred Stock will bear a legend substantially to the following effect:




“THIS SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THIS
SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY OR THE
SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.”



     (b) In addition, the Trust agrees that all certificates or other instruments representing the
Underlying Shares will bear a legend substantially to the following effect:




“THE SECURITIES REFERRED TO HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. NEITHER
SUCH SECURITIES NOR ANY INTEREST OR PARTICIPATION THEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE
OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION.”



     (c) In the event that any Series C Preferred Stock or Underlying Shares (i) become registered
under the Securities Act or (ii) are eligible, in the opinion of counsel to the holder of Series C
Preferred Stock reasonably satisfactory to the Company, to be transferred without restriction or
any limitation in accordance with Rule 144, the Company shall issue new certificates or other
instruments representing such Series C Preferred Stock or Underlying Shares, which shall not
contain the applicable legends in Sections 5.2(a) and (b) above; provided that the holder of the
Series C Preferred Stock or Underlying Shares, as applicable, surrenders to the Company the
previously issued certificates or other instruments.



6. COVENANTS




          The Company covenants and agrees with the Trust that:




     
6.1. Board of Directors Resolutions.




          (a) The Board of Directors of the Company (the “Board of Directors”) shall adopt
within 45 days of the Effective Date resolutions pursuant to 8 Del. C. § 242(b), in form and
substance reasonably satisfactory to the Trustees, to amend (i) the Charter 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 (the





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“Common Stock Amendment Proposal”), (ii) the Charter to reduce the
par value of the Company’s Serial Preferred Stock (as defined in the Charter) to $0.00004 per share
and increase the number of authorized shares of the Company’s Serial Preferred Stock to 13 billion
(the “Serial Preferred Stock Amendment Proposal”), (iii) the Certificate of Designations
such that (1) the number of shares of Series C Preferred Stock authorized and outstanding upon the
effectiveness of the Serial Preferred Stock Amendment Proposal shall be the Number of Underlying
Shares (as defined in the Certificate of Designations) as of the
effective date of the Serial Preferred
Stock Amendment Proposal, (2) the Conversion Ratio (as defined in the Certificate of Designations)
as of any date shall equal the quotient obtained by dividing (x) the
Number of Outstanding Shares (as defined in the Certificate of
Designations) as of such date by (y) the Number of
Outstanding Shares as of the
effective date of such amendment and (3) the liquidation preference per share of the Series C
Preferred Stock shall be $500,000 divided by the Number of Underlying Shares as of the effective
date of such amendment (the “Series C Preferred Stock Amendment Proposal” and, collectively
with the Common Stock Amendment Proposal and the Serial Preferred
Stock Amendment Proposal, the “Special
Meeting Shareholder Proposals”), (iv) the Charter (A) to permit the Board of Directors to issue
classes of Serial Preferred Stock that are not of equal rank, such that the Board of Directors or a
duly authorized committee thereof may, prior to issuance, in the resolution or resolutions
providing for the issue of shares of each particular series, provide whether the shares of such
series rank senior or junior to any other class of Serial Preferred 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 and (B) to cause the Series D
Preferred Stock and any other series of Serial Preferred Stock subsequently issued to the United
States Department of the Treasury to rank senior to the Series C Preferred Stock and any other
subsequently issued series of Serial Preferred Stock that is not issued to the United States
Department of the Treasury, so that as a result of these amendments the Series C Preferred Stock
and any subsequently issued series of Serial Preferred Stock that ranks pari passu with or junior
to the Series C Preferred Stock would not be entitled to vote on the subsequent creation or
issuance of any such senior Serial Preferred Stock (the “Series D Preferred Stock Amendment
Proposal”) and (v) the Charter to eliminate any restriction on the pledging of all or
substantially all of the property or assets of the Company (the “Pledging Restrictions
Amendment Proposal” and, collectively with the Common Stock Amendment Proposal, the Serial
Preferred Stock Amendment Proposal, the Series C Preferred Stock Amendment Proposal and the Series
D Preferred Stock Amendment Proposal, the “Charter Amendment Proposals”).




          (b) Pursuant to 8 Del. C. § 242(b) the Board of Directors shall, concurrently with the
adoption of the resolutions described in clause (a) above, declare that the Charter Amendment
Proposals are advisable and (i) call a special meeting with respect to the Special Meeting
Shareholder Proposals or direct that the Special Meeting Shareholder Proposals be considered at an
annual meeting of the holders of the Company’s capital stock, as applicable, when so directed by
the Trust in accordance with Section 6.2(a) (provided, that the notice for a special meeting or
annual meeting described in this clause (a) shall not be given until at least 60 days after the
Company’s 2009 Annual Meeting of Shareholders) and (ii) direct that the Series D Preferred Stock
Amendment Proposal and the Pledging Restrictions Amendment Proposal (collectively the “General
Meeting Shareholder Proposals”) be considered at the next annual meeting of the holders of the
Company’s capital stock in accordance with Section 6.2(b).




     
6.2. Shareholder Vote.




          (a) The Trust shall have the right, in its sole discretion, by giving a notice in accordance
with Section 8.3, to cause the Board of Directors, without regard to any subsequent determination
made by the Board of Directors concerning the Special Meeting Shareholder Proposals, to call, give
notice of and hold a special meeting of the holders of the Company’s capital stock or, if so
elected by the Trust in the notice from the Trust, direct that the Special Meeting Shareholder
Proposals be considered at the next annual




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meeting of the holders of the Company’s capital stock
following such notice from the Trust, as applicable (provided, that the notice for a special
meeting or annual meeting described in this clause (a) shall not be given until at least 60 days
after the Company’s 2009 Annual Meeting of Shareholders), with the holders of the Common Stock
voting as a separate class in the case of the Common Stock Amendment Proposal and, if applicable,
the holders of the Company’s Serial Preferred Stock voting as a separate class in the case of the
Serial Preferred Stock Amendment Proposal and, if applicable, the holders of the Series C Preferred
Stock voting as a separate class in the case of the Series C Preferred Stock Amendment Proposal, to
vote on, among other things, (i) the Common Stock Amendment Proposal, (ii) Serial Preferred Stock
Amendment Proposal and (iii) the Series C Preferred Stock Amendment Proposal; provided, that a vote
on the Serial Preferred Stock Amendment Proposal and the Series C Preferred Stock
Amendment Proposal will only be effective if the Common Stock Amendment Proposal is not
approved by the holders of the Common Stock. The Board of Directors shall recommend to the
Company’s shareholders that they vote in favor of the Special Meeting Shareholder Proposals. In
the event that the approval of all or any portion of the Special Meeting Shareholder Proposals is
not obtained at such special shareholders’ meeting, the Trust shall have the right to direct the
Company to include a proposal to approve (and the Board of Directors shall recommend approval of)
all or such portion of the Special Meeting Shareholder Proposals as the Trust may designate at the
next annual meeting of its shareholders and at each subsequent annual meeting of its shareholders
until such approval is obtained.




          (b) At and prior to the next annual meeting of the Company’s shareholders following the
Closing Date, the Company shall take all action necessary under all applicable laws and regulations
and the Company’s Organizational Documents to effect the General Meeting Shareholder Proposals.
Such actions shall include, without limitation, the Board of Directors’ calling, giving notice of
and holding an annual meeting of the holders of the Company’s capital stock to vote on, among other
things the General Meeting Shareholder Proposals and without regard to any subsequent determination
made by the Board of Directors concerning the General Meeting Shareholder Proposals. The Board of
Directors shall recommend to the Company’s shareholders that they vote in favor of the General
Meeting Shareholder Proposals. In the event that the approval of the General Meeting Shareholder
Proposals is not obtained at such annual shareholders’ meeting, the Company shall include a
proposal to approve such proposals at each subsequent annual meeting of its shareholders, or at any
special meeting of the holders of the Company’s capital stock called pursuant to clause (a) above,
until such approval is obtained.




          (c) In connection with the special shareholders’ meeting and each annual shareholders’ meeting
described in clause (a) or (b) above, the Company shall prepare (and the Trust will reasonably
cooperate with the Company to prepare) and file with the SEC a preliminary proxy statement
reasonably acceptable to the Trust, 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
shareholders’ meeting to be mailed to the Company’s shareholders promptly after clearance thereof
by the SEC. The Company shall prepare the preliminary proxy statement describing the Special
Meeting Shareholder Proposals as promptly as practicable following the Closing Date, but shall not
file it with the SEC unless so directed by the Trust. The Company shall notify the Trust 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 Trust 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. The Company shall, at its own expense, use its
reasonable best efforts to solicit proxies for shareholder approval of the Special Meeting
Shareholder Proposals and the General Meeting Shareholder Proposals, including, but not limited to,
selecting and retaining a proxy solicitor. If at any time prior to any such shareholders’ meeting
there shall occur any event that is required to be set forth in an amendment or supplement to the
proxy statement, the



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Company shall as promptly as practicable prepare and mail to its shareholders
such an amendment or supplement. Each of the Trust 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 shareholders an amendment or
supplement to correct such information to the extent required by applicable laws and regulations.
The Company shall consult with the Trust prior to filing any proxy statement, or any amendment or
supplement thereto, and provide the Trust with a reasonable opportunity to comment thereon.




          (d) None of the information supplied by the Company or any of the subsidiaries of the Company
for inclusion in any proxy statement in connection with any shareholders’ meeting of the Company
will, at the date when first mailed to the Company’s shareholders and at the time of any
shareholders’ meeting, and at the time of any amendment or supplement thereof after mailing,
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.




     6.3. Governance. The Company and the Board of Directors shall work in good faith with the
Trustees to ensure corporate governance arrangements satisfactory to the Trustees.



     6.4. Regulation. The Company shall use its reasonable best efforts to take all actions
necessary or appropriate to obtain any regulatory approvals, notices, waivers or consents related
to the issuance and acquisition of the Series C Preferred Stock or the conversion thereof into the
Underlying Shares that are reasonably determined by the Company to be material and that have not
been obtained on or prior to the Closing Date and shall assist the Trust in such matters.



     6.5. Takeover Laws. The Company will take all actions necessary or expedient in order to
exempt the Trust and any department, agency or instrumentality of the United States government and
the Trust’s or such other entity’s acquisition and ownership of the Series C Preferred Stock and
any Underlying Shares from, and the Trust and any such other entity and such acquisition and
ownership from, (i) the requirements of any applicable “moratorium,” “control share,” “fair price”
or other anti-takeover laws and regulations of any jurisdiction, including without limitation
Section 203 of the Delaware General Corporation Law, and (ii) any other applicable provision of the
Organizational Documents of the Company or the comparable organizational documents of any
subsidiary of the Company.



     6.6. Additional Issuance of Shares. If a Conversion Date (as defined in the Certificate of
Designations) for any of the Shares occurs prior to the issuance of Common Stock on the Third Stock
Purchase Date (as defined in the Purchase Contract Agreement) for the Equity Units, then the
Company shall, concurrently with each Stock Purchase Date, Early Settlement Date or Cash Merger
Early Settlement Date (each as defined in the Purchase Contract Agreement), as applicable, for the
Equity Units following such Conversion Date issue to the Trust or to such other Person as the Trust
may direct a number of shares of Common Stock equal to the excess of (x) the number of shares of
Common Stock the Trust would have received if it had converted such Shares immediately after the
issuance of such shares of Common Stock on such Stock Purchase Date, Early Settlement Date or Cash
Merger Early Settlement Date over (y) the number of shares of Common Stock received upon the
conversion of such Shares by the holder thereof plus the number of shares of Common Stock delivered
to the Trust or its designee under this Section 6.6 as a result of any earlier settlement of such
Equity Units. Any such shares of Common Stock issued to



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the Trust shall be registered for the sole
benefit of the United States Treasury in the name of the Trustees in their capacities as Trustees
of the Trust. Any such shares of Common Stock issued to such other Person shall be registered in
the name of such other Person as the Trustees may direct in their capacities as Trustees of the
Trust.




     6.7. Depositary Shares. Upon request by the Trust in connection with a proposed transfer of
the Shares to a third party, the Company shall promptly enter into a depositary arrangement,
pursuant to customary agreements reasonably satisfactory to the Trust and with a depositary
reasonably acceptable to the Trust, pursuant to which the Shares may be deposited and depositary
shares, each representing a fraction of a Share or multiple Shares as specified by the Trust, may
be issued. From and after the execution of any such depositary arrangement, and the deposit of any
Shares pursuant thereto, the depositary shares issued pursuant thereto shall be deemed “Series
C Preferred Stock” and, as applicable, “Registrable Securities” for purposes of this
Agreement.



     6.8. Issuance of Securities. So long as the equity ownership of the Trust, determined as the
sum of the number of shares of Common Stock received upon the conversion of the Series C Preferred
Stock and still owned by the Trust and the product of the aggregate number of shares of Series C
Preferred Stock
owned by the Trust and the Conversion Ratio (whether or not shares of Series C Preferred Stock
are then convertible), shall equal or exceed 50% of the Number of Underlying Shares (as adjusted
pursuant to Section 11(G) of the Certificate of Designations), the Company shall not, without the
prior written consent of the Trust, issue or grant (i) any capital stock or equity ownership
interest, including any Participating Security (as defined in the Certificate of Designations);
(ii) any rights, options, warrants or convertible securities exercisable or exchangeable for or
convertible into any capital stock or other equity ownership interest, including any Participating
Security; or (iii) any stock appreciation rights, phantom stock rights, or any other profit
participation rights, or any rights or options to acquire any such rights, in each case of clauses
(i), (ii) and (iii) above, to any Person. Notwithstanding the previous sentence, the Company shall
be permitted to issue capital stock (i)(x) 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 the
Company’s Amended and Restated 2007 Stock Incentive Plan or the Company’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 that meets the requirements of Sections 401(a) or 423 of the
Code and (ii) subsequent to written notice from the Trust that the Company’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 New York Stock Exchange Listed Company Manual or (y) in any one 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 of
the Board of Directors.



7. REGISTRATION RIGHTS




     7.1. Registration. Section 4.5 of the Series D Preferred Stock Purchase Agreement is hereby
incorporated by reference herein with the amendments to such section as provided in Section 7.2 of
this Agreement.



     7.2. Amendments. For purposes of this Agreement the provisions of Section 4.5 of the Series D
Preferred Stock Purchase Agreement that are incorporated by reference herein shall be amended as
follows:



          (a) “Investor” shall mean the Trust;




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          (b) “Registrable Securities” shall, except for purposes of Section 4.5(a)(vi) of the Series D
Preferred Stock Purchase Agreement, mean: (A) the Series C Preferred Stock, (B) the Underlying
Shares 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 or share dividend or share split or in connection with a combination of shares,
recapitalization, reclassification, merger, amalgamation, arrangement, consolidation or other
reorganization. The shares of Series C Preferred Stock and the Underlying Shares shall cease to be
Registrable Securities when (1) they are sold pursuant to Rule 144 or an effective registration
statement under the Securities Act, (2) except as provided in Section 4.5(o) of the Series D
Preferred Stock Purchase Agreement, 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 such Registrable Securities may be registered
under more than one registration statement at any one time;




          (c) The provisions of Section 4.5 of the Series D Preferred Stock Purchase Agreement
applicable to the Warrant shall not apply;




          (d) “$200 million” in the eighth line of Section 4.5(a)(ii) of the Series D Preferred Stock
Purchase Agreement shall be revised to “$100 million”;




          (e) “and (2) not more than three times in any 12-month period” beginning in the twelfth line
of Section 4.5(a)(iii) of the Series D Preferred Stock Purchase Agreement shall be revised to “and
(2) not more than two times in any 12-month period”;




          (f) a new parenthetical is added to the end of Section 4.5(a)(vi)(B) of the Series D Preferred
Stock Purchase Agreement so that the end of subclause (B) shall read “(for the purposes of this
subclause (B) only, as each term is defined in the Series D Preferred Stock Purchase Agreement)”;




          (g) a new subclause (C) is added to Section 4.5(a)(vi) and current subclause (C) is changed to
(D). New subclause (C) shall read: “(C) then the Registrable Securities of the Trust and all other
Holders who have received Registrable Securities from the Trust and 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”;




          (h) “members and former members” in the second line of Section 4.5(e) of the Series D
Preferred Stock Purchase Agreement shall be revised to “members, former members and trustees (both
individually and in their fiduciary capacities)”;




          (i) “representatives and Affiliates” in the third line of Section 4.5(g)(i) of the Series D
Preferred Stock Purchase Agreement shall be revised to “representatives, trustees (both
individually and in their fiduciary capacities) and Affiliates”;




          (j) “, joint or several,” in the eighth line of Section 4.5(g)(i) of the Series D Preferred
Stock Purchase Agreement shall be revised to “, joint or several, (x) with respect to the Trustees
and their agents and representatives, relating to, arising out of or in connection with any
registration pursuant to this Agreement or (y)”;




          (k) “not misleading; provided that the Company” in the sixteenth line of Section 4.5(g)(i) of
the Series D Preferred Stock Purchase Agreement shall be revised to “not misleading. With respect
to clause (x)





10












 





     above, the Company will not, however, be responsible for any losses, claims, damages,
actions or liabilities (or costs or expenses relating thereto) that are finally judicially
determined to have resulted from the bad faith or gross negligence of any Indemnitee. With respect
to clause (y) above, the Company”;



     (l) “a liquidation preference or, in the case of Registrable Securities other than Preferred
Stock,” beginning in the third line of Section 4.5(h) of the Series D Preferred Stock Purchase
Agreement shall be deleted and for the purpose of Section 4.5 the market value of the Series C
Preferred Stock shall be the market value of a number of shares of Common Stock issuable upon
conversion of such shares of Series C Preferred Stock (whether or not shares of Series C Preferred
Stock are then convertible);



     (m) “$200 million” in the fourth line of Section 4.5(h) of the Series D Preferred Stock
Purchase Agreement shall be revised to “$100 million”;



     (n) “, in the case of an underwritten offering of Common Stock or Warrants,” in the fifth line
of Section 4.5(i) of the Series D Preferred Stock Purchase Agreement shall be deleted; and



     (o) “, in the case of an underwritten offering of Preferred Stock, any preferred stock of the
Company, or, in each case,” beginning in the sixth line of Section 4.5(i) of the Series D Preferred
Stock Purchase Agreement shall be deleted.



     7.3. Consistency. The Trust agrees that Section 7.1 and Section 7.2 of this Agreement are not
inconsistent with or in conflict with Section 4.5 of the Series D Preferred Stock Purchase
Agreement.



8. MISCELLANEOUS




     8.1. Amendments; Waivers. This Agreement may be waived or amended solely by a writing
executed by all of the parties hereto. In no event shall any rights granted hereunder prevent the
parties hereto from waiving or amending in any manner whatsoever the covenants of the Company
hereunder.



     8.2. Governing Law; Jurisdiction; Venue or Inconvenient Forum. 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. The Series C Preferred Stock shall be
governed as set forth in the terms thereof. The parties agree that the United States District Court
for the Southern District of New York shall have exclusive jurisdiction over any claims arising
under this Agreement, including claims for enforcement of the Agreement. Each party hereby waives,
to the extent permitted by applicable law, any objection to venue or any defense of inconvenient
forum or any personal or subject matter jurisdictional defense in connection with such proceedings
in such court.



     8.3. Notices. Any notice which any party hereto may give to the other hereunder shall be in
writing and shall be given by hand delivery, first class registered mail, or overnight courier
service, or by facsimile transmission confirmed by one of the aforesaid methods, sent,



11









 




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 III, Michael M. Wiseman

Facsimile: (212) 558-3588

Telephone: (212) 558-4000



if to the Trust:



AIG Credit Facility Trust

c/o Kevin F. Barnard

Arnold & Porter LLP

399 Park Avenue

New York, New York 10022

Facsimile : (212) 715-1399

Telephone: (212) 715-1000



with copies to the Trustees, to the addresses and facsimile numbers that each

Trustee has provided to the Company in writing on the Effective Date,



or to such other address and facsimile number as such party may hereafter specify for the purpose
of notices to the other party. All notices hereunder shall be effective upon receipt.




     8.4. Waiver of Jury Trial. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY
HERETO CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THE FOREGOING WAIVER.



     8.5. Business Day. To the extent that any deadline or date of performance of any right or
obligation set forth herein shall fall on a day other than a Business Day, then such deadline or
date of performance shall automatically be extended to the next succeeding Business Day.



     8.6. Entire Agreement. This Agreement, together with the Certificate of Designations,
constitutes the entire contract between the parties relative to the subject matter hereof. Any
other previous agreement among the parties with respect to the subject matter hereof is superseded
by this Agreement, together with the Certificate of Designations. Nothing in this Agreement,
together with the Certificate of Designations,



12









 







expressed or implied, is intended to confer upon any
Person (other than the parties hereto and thereto, their respective successors and assigns
permitted hereunder) any rights, remedies, obligations or liabilities under or by reason of this
Agreement, together with the Certificate of Designations.



     8.7. Remedies. Each of the parties hereto acknowledges and agrees that in the event of any
breach of this Agreement, each non-breaching party would be irreparably and immediately harmed and
could not be made whole by monetary damages. It is accordingly agreed that the parties hereto (a)
will, to the extent permitted by law, waive, in any action for specific performance, the defense of
adequacy of a remedy at law and (b) shall, to the extent permitted by law, be entitled, in addition
to any other remedy to which they may be entitled at law or in equity, to an order compelling
specific performance of this Agreement in any action instituted in the United States District Court
for the Southern District of New York.



     8.8. No Personal Liability by Trustees. It is expressly understood and agreed by the parties
hereto that this Agreement is being executed and delivered by the Trustees not individually or
personally but solely in their capacities as Trustees in the exercise of the powers and authority
conferred and vested in them as such Trustees, and under no circumstances shall any Trustee or
former Trustee have any personal liability in the Trustee’s individual capacity in connection with
this Agreement or any transaction contemplated hereby.



     8.9. Severability. In the event that any one or more of the provisions contained in this
Agreement should be held invalid, illegal or unenforceable in any respect, then to the extent
permitted by applicable law, the validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired thereby (it being understood that the
invalidity of a particular provision in a particular jurisdiction shall not in and of itself affect
the validity of such provision in any other jurisdiction). The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the
economic effect of which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.



     8.10. Assignment. Neither this Agreement nor any right, remedy, obligation or liability
arising hereunder or by reason hereof shall be assignable or delegable by any party hereto without
the prior written consent of the other party, and any attempt to assign or delegate any right,
remedy, obligation or liability hereunder without such consent shall be void. Notwithstanding the
foregoing the Trust may, without the Company’s consent, transfer or assign (i) all or any part of
its rights and remedies under Sections 6.2 and 6.6 of this Agreement to any third party and (ii)
all or any part of its rights and remedies under Sections 7.1 and 7.2 of this Agreement as
permitted by such Sections.



[Signature Page Follows]




13









 





     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date set forth
in the first paragraph hereof.



	 	 	 	 	 
	 	AMERICAN INTERNATIONAL GROUP, INC.

 	 
	 	By:  	 /s/ Edward
M. Liddy	 
	 	 	Name:  	 Edward M. Liddy	 
	 	 	Title:  	 Chairman and Chief Executive Officer	 
	 



	 	 	 	 	 
	 	AIG CREDIT FACILITY TRUST

 	 
	 	By:  	 /s/ Jill
M. Considine	 
	 	 	Name:  	Jill M. Considine	 
	 	 	Title:  	Trustee 	 
	 



	 	 	 	 	 
	 	 	 
	 	By:  	 /s/ Chester
B. Feldberg	 
	 	 	Name:  	Chester B. Feldberg	 
	 	 	Title:  	Trustee 	 
	 



	 	 	 	 	 
	 	 	 
	 	By:  	 /s/ Douglas
L. Foshee	 
	 	 	Name:  	Douglas L. Foshee	 
	 	 	Title:  	Trustee 	 
	 



Signature Page to Series C Perpetual, Convertible, Participating Preferred Stock Purchase Agreement





14









 





EXHIBIT A




[FORM OF SERIES C PERPETUAL, CONVERTIBLE, PARTICIPATING PREFERRED

STOCK CERTIFICATE OF DESIGNATIONS]

















 







CERTIFICATE OF DESIGNATIONS




OF




SERIES C PERPETUAL, CONVERTIBLE, PARTICIPATING 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 March 1, 2009:



     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 from time
to time, 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 C Perpetual, Convertible, Participating Preferred Stock:




     Capitalized terms used and not defined have the respective meanings set forth in Section 19.


Section 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 C Perpetual, Convertible, Participating Preferred Stock” (the “Series C
Preferred Stock”). The authorized number of shares of the Series C Preferred Stock shall be
100,000. 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 Series C Preferred Stock to a number less than the number of shares then outstanding.



Section 2. Dividends and Distributions.





(A) Subject to the rights of the holders of any shares of any series of Preferred Stock
ranking prior and superior to the Series C Preferred Stock with respect to dividends, the
holders of shares of Series C Preferred Stock shall be entitled to receive per share of
Series C Preferred Stock when, as and if declared by the Board of Directors or any duly



 









 







authorized committee of the Board of Directors out of funds legally available for the
purpose, on the same date as any dividends are paid on the Common Stock (payable in cash or
in kind as applicable, other than in shares of Common Stock or other securities the Company
may issue) (each such date being referred to herein as a “Dividend Payment Date”),
commencing on the first Dividend Payment Date on or after March 4, 2009, dividends or
distributions in an amount (rounded to the nearest cent) equal to the Conversion Ratio on
the record date for such dividend or distribution times the amount of the cash dividend per
share of Common Stock to be paid on such Dividend Payment Date (and the Conversion Ratio on
the record date for such dividend or distribution times the amount (payable in kind) of the
non-cash dividend or other distribution, other than a dividend payable in shares of Common
Stock or in other securities the Company may issue, to be paid per share of Common Stock on
such Dividend Payment Date), whether or not shares of Series C Preferred Stock are
convertible as of the applicable record date; provided however that if the
aggregate amount of dividends and distributions paid on any Dividend Payment Date with
respect to all shares of Series C Preferred Stock then outstanding would exceed the
Threshold Percentage of the aggregate amount of dividends and distributions paid with
respect to all shares of Series C Preferred Stock then outstanding together with all shares
of Common Stock then outstanding, then the amount of dividends and distributions paid per
share of Series C Preferred Stock shall be reduced pro rata so that the aggregate amount of
dividends and distributions paid on any Dividend Payment Date with respect to all shares of
Series C Preferred Stock then outstanding will not exceed the Threshold Percentage of the
aggregate amount of dividends and distributions paid with respect to all shares of Series C
Preferred Stock then outstanding together with all shares of Common Stock then outstanding.
For the avoidance of doubt, the intent of the foregoing is that the dividends or other
distributions paid to holders of shares of Series C Preferred Stock (other than a dividend
payable in shares of Common Stock or other securities the Company may issue) shall equal the
dividends and other distributions that would have been payable with respect to the shares of
Common Stock issuable upon conversion of such shares of Series C Preferred Stock (whether or
not such shares were convertible as of the applicable record date at the Conversion Ratio),
subject to the foregoing proviso.




     The holders of the Series C Preferred Stock agree that, upon the effectiveness of the
Ranking Amendment, the Series C Preferred Stock shall rank junior to the Series D Preferred
Stock as to the payment of dividends and distributions.




(B) The Company shall not declare or pay a dividend or distribution on the Common Stock
(other than a dividend payable in shares of Common Stock or other securities the Company may
issue) unless it simultaneously declares and pays such dividend or distribution on the
Series C Preferred Stock as provided in paragraph (A) of this Section.




(C) The Board of Directors or any duly authorized committee of the Board of Directors may
fix a record date for the determination of holders of shares of Series C Preferred Stock
entitled to receive payment of a dividend or distribution declared thereon, which record
date shall be not more than 60 days prior to the date fixed for the payment thereof and
shall be the same as the record date for the determination of holders of shares of Common
Stock entitled to receive payment of a concurrent dividend or distribution.



2









 






(D) Notwithstanding anything else to the contrary herein, if required by law, the Company
(or its agents) shall withhold and backup withhold tax on any payment or distribution on the
Series C Preferred Stock, on the Conversion Securities (or in lieu thereof) and on any
adjustment to the Conversion Ratio. Such withholding shall be treated for all purposes
hereunder as if paid to the holder of such Series C Preferred Stock or Conversion
Securities. The Company (or its agents) may (but is not required to) set-off any tax that
the Company is required to withhold as a result of a change in the Conversion Ratio against
payments of dividends payable on the Series C Preferred Stock and against Conversion
Securities deliverable upon the conversion of the Series C Preferred Stock (valued at the
Current Market Price Per Share upon conversion).


Section 3. Voting Rights. The holders of shares of Series C Preferred Stock shall have the
following voting rights:





(A) Each share of Series C Preferred Stock shall entitle the holder thereof to a number of
votes equal to the Conversion Ratio as of the applicable record date on all matters
submitted to a vote of the stockholders of the Company having general voting rights, whether
or not shares of Series C Preferred Stock are convertible as of such record date;
provided however that if the aggregate voting power of the Series C
Preferred Stock on any such matter would exceed the Threshold Percentage of the aggregate
voting power of the stockholders of the Company entitled to vote on such matter as of such
record date, then the voting power per share of Series C Preferred Stock shall be reduced
pro rata so that the aggregate voting power of the Series C Preferred Stock on such matter
will not exceed the Threshold Percentage of the aggregate voting power of the stockholders
of the Company entitled to vote on such matter as of such record date. For the avoidance of
doubt, the intent of the foregoing is that the voting power of the holders of shares of
Series C Preferred Stock on all matters submitted to a vote of the stockholders of the
Company having general voting rights shall equal the voting power of the shares of Common
Stock issuable upon conversion of such shares of Series C Preferred Stock (whether or not
such shares were convertible as of the applicable record date at the Conversion Ratio),
subject to the foregoing proviso.




(B) Except as otherwise provided herein, or in any other Certificate of Designations
creating a series of Preferred Stock or as required by law, the holders of shares of Series
C Preferred Stock and the holders of shares of Common Stock and any other capital stock of
the Company having general voting rights shall vote together as one class on all matters
submitted to a vote of stockholders of the Company.


Section 4. Certain Restrictions.





(A) No dividend shall be paid upon, or declared or set apart for, any share of Series C
Preferred Stock or any other share of Preferred Stock ranking on a parity with the Series C
Preferred Stock as to dividends unless at the same time a like proportionate dividend,
ratably in proportion to the respective total amounts to which the
holders of all such shares are then entitled, shall be paid upon, or declared and set apart for, all shares of
Series C Preferred Stock and Preferred Stock of all series ranking on a parity as to



3









 







dividends then issued and outstanding and on which dividends are accrued and payable for all
dividend periods terminating on or prior to the relevant Dividend Payment Date.




(B) In no event, so long as any shares of Series C 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 dividends on
the Series C Preferred Stock and any series of Preferred Stock ranking on a parity with the
Series C Preferred Stock as to dividends for all past dividend periods and for the then
current period shall have been 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 respect to any sinking fund for any series
of Preferred Stock ranking on a parity with the Series C Preferred Stock as to dividends.
The foregoing provisions of paragraph (B) of this Section 4 shall not, however, apply to a
dividend payable on any 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.




(C) The Company shall not permit any subsidiary of the Company to purchase or otherwise
acquire for consideration any shares of stock of the Company unless the Company could, under
paragraph (B) of this Section 4 and under the applicable provisions of the Charter, purchase
or otherwise acquire such shares at such time and in such manner.


Section 5. Reacquired Shares. Shares of the Series C Preferred Stock that are repurchased
or otherwise acquired by the Company shall revert to authorized but unissued shares of Preferred
Stock (provided that any such cancelled shares of the Series C Preferred Stock may be reissued only
as shares of any series of Preferred Stock other than the Series C Preferred Stock).



Section 6. 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 any junior stock, the holders of the Series
C 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 C Preferred Stock shall be $5.00 per share, plus an amount equal to
all previously declared and unpaid dividends; provided that the holders of Series C
Preferred Stock shall be entitled to receive per share of Series C Preferred Stock no less than an
aggregate amount equal to the Conversion Ratio at such time multiplied by the amount to be
distributed per share of Common Stock. For the avoidance of doubt, the intent of the foregoing
proviso is to result in the distributions made to holders of shares of Series C Preferred Stock at
least equaling the payments that would have been payable with respect to the shares of Common Stock
issuable upon conversion of such shares of Series C Preferred Stock (whether or not such shares
were then convertible at the Conversion Ratio). If such payment shall have been made in full to
holders of the Series C 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 of the junior stock, according to their respective rights and preferences and in
each case according to their respective shares. If, upon


4









 






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 Series C Preferred Stock and any
series of Preferred Stock ranking on a parity therewith as to liquidation, the holders of Series C
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,
dissolution or winding up of the affairs of the Company within the meaning of the foregoing
provisions of this Section 6.




     The holders of the Series C Preferred Stock agree that, upon the effectiveness of the Ranking
Amendment, the Series C Preferred Stock shall rank junior to the Series D Preferred Stock as to the
payment of amounts upon the liquidation, dissolution or winding up of the Company.


Section 7. Consolidation, Merger, etc. In case the Company shall enter into any
consolidation, merger, combination or other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or securities, cash and/or any other property, then in
any such case each share of Series C Preferred Stock shall at the same time become convertible into
an amount per share (payable in cash or kind, as applicable), equal to the Conversion Ratio at the
effective time multiplied by the aggregate amount of stock, securities, cash and/or any other
property (payable in kind), as the case may be, into which or for which each share of Common Stock
is changed or exchanged.



Section 8. No Redemption; Perpetual. The shares of Series C Preferred Stock shall not be
redeemable, either at the option of the Company or the holders thereof, and are not subject to a
sinking fund. The Series C Preferred Stock has no set redemption or repayment date and does not
have a maturity.



Section 9. Rank. Subject to the second sentence of this Section 9, the Series C Preferred
Stock shall rank, with respect to the payment of dividends and the distribution of assets, to the
extent set forth in this Certificate of Designations on a parity with all series of any other class
of the Company’s Serial Preferred Stock. The holders of the Series C Preferred Stock agree that,
upon the effectiveness of the Ranking Amendment, the Series C Preferred Stock shall rank junior to
the Series D Preferred Stock as to the payment of dividends and the distribution of assets.



Section 10. Amendment. This Certificate of Designations shall not be amended, modified or
supplemented in any manner that is adverse to the holders of Series C Preferred Stock without the
affirmative vote of the holders of at least 66-2/3% of the outstanding shares of Series C Preferred
Stock, voting together as a single class and as a separate class from all other capital stock of
the Company. Neither the Charter nor the bylaws of the Company shall be amended, modified or
supplemented in any manner, including through a merger, consolidation or other transaction or
otherwise, that would materially alter or change the powers, preferences, privileges or rights of
the Series C Preferred Stock so as to affect them adversely or in any manner that would eliminate,
impair, interfere with, limit, condition or otherwise modify the right of stockholders to act by
written consent in lieu of a meeting of stockholders, in each case without the affirmative vote of
the holders of at least 66-2/3% of the outstanding shares of Series


5









 






C Preferred Stock, voting together as a single class and as a separate class from all other capital
stock of the Company. Without the affirmative vote of the holders of at least 66-2/3% of the
outstanding shares of Series C Preferred Stock, voting together as a single class and as a separate
class from all other capital stock of the Company, neither the Charter nor the bylaws of the
Company shall be amended, modified or supplemented in any manner that would eliminate, impair,
interfere with, limit, condition or otherwise modify the provisions, or the rights of stockholders,
relating to the call (including by stockholders) of special meetings of stockholders.



Section 11. Conversion.





(A) (i) Upon the terms and in the manner set forth herein, each share of Series C Preferred
Stock shall be convertible, at the option of the holder thereof, at any time or from time to
time, in whole or in part, commencing on the effective date of the Charter Amendment upon
surrender to the transfer agent which may be maintained for such purpose (the
“Conversion Agent”) of the certificate(s) for each share to be converted or, if the
shares of Series C Preferred Stock are not in certificated form, upon delivery to the
Conversion Agent of a written Notice of Conversion (the date on which the Conversion Agent
shall have received a written Notice of Conversion and, if applicable, a surrendered
certificate, the “Conversion Date”), into (x) a number of shares of Common Stock
equal to the Conversion Ratio (it being agreed that if there is more than one class or
series of Common Stock the holder shall be entitled to elect in its sole discretion which
class or series, or combination thereof, shall be issued upon conversion hereof), plus (y)
to the extent the Conversion Date falls on or after the close of business on a record date
(or record dates) for the related payment of dividends and before the relevant payment
date(s), a right to receive on the related payment date an amount in cash equal to the
amount of cash that would have been paid to the holder if the shares of Common Stock
received upon conversion had been outstanding on the record date (unless such dividends or
distributions are payable in kind in which case they shall be so payable), it being
understood and agreed that the Series C Preferred Stock so converted shall not be entitled
to any dividends or distributions with respect to such related payment date. If the Company
shall fail to deliver any of the amounts or property described in clause (y), such failure
shall not affect the validity of the issuance of any securities pursuant to clause (x) and
the Company shall continue to be required to deliver the amounts or property contemplated by
clause (y). Upon conversion by the holder of Series C Preferred Stock pursuant to this
Section 11 and upon receipt of such payments, such holder shall not be entitled to any
future dividends, distributions or other payments otherwise payable on shares of Series C
Preferred Stock pursuant to Section 2 hereof with respect to shares of Series C Preferred
Stock so converted (for the avoidance of doubt, nothing herein shall affect the right of
such holder to receive dividends on any shares of Common Stock or other securities
deliverable upon conversion of any shares of Series C Preferred Stock, the record date for
which occurs after the Conversion Date).




     (ii) In order to convert shares of Series C Preferred Stock pursuant to Section 11, the
holder thereof shall deliver a properly completed and duly executed Notice of Conversion (as
set forth in the form of Series C Perpetual, Convertible, Participating Preferred Stock
certificate attached hereto). Each holder of Series C Preferred Stock shall (A) deliver a
Notice of Conversion to the Conversion Agent specifying the name or



6









 






names in which such holder wishes to register such shares of Common Stock issuable upon
such conversion on the stock ledger of the Company, (B) if such shares of Series C Preferred
Stock are evidenced by a certificate, surrender the certificate for such shares of Series C
Preferred Stock to the Conversion Agent, accompanied, if so required by the Conversion
Agent, by a written instrument or instruments of transfer in form reasonably satisfactory to
the Conversion Agent duly executed by the holder or its attorney duly authorized in writing,
or if such shares of Series C Preferred Stock are not evidenced by a certificate, deliver to
the Conversion Agent a written instrument or instruments of transfer in form reasonably
satisfactory to the Conversion Agent duly executed by the holder or its attorney duly
authorized in writing, and (C) subject to Section 11(I) hereof, pay any transfer or similar
tax required hereby; provided that such transfer or similar tax may, at the option
of such holder and in lieu of any payment in cash, be paid through a reduction of the number
of shares of Common Stock received upon such conversion, valued at the Current Market Price
Per Share (as defined herein).




(B) Whenever a holder converts the Series C Preferred Stock in whole or in part, it may
assign its right to receive the Common Stock or Conversion Securities (as defined below)
issuable upon such conversion to any other Person, subject to the provisions of Section
11(I) and Section 13 hereof.




(C) The Company covenants and agrees that all shares of Common Stock or other securities
that may be issued upon conversion of the Series C Preferred Stock (the “Conversion
Securities”) will, upon issuance, be validly authorized, issued and outstanding, fully
paid and nonassessable, free of preemptive rights and free from all taxes, liens and charges
with respect to the issuance thereof (other than liens or charges created by the holder of
the Series C Preferred Stock, income and franchise taxes incurred in connection with the
conversion of the Series C Preferred Stock or taxes in connection with any transfer
occurring prior to or contemporaneously therewith).




(D) If the shares of Common Stock or other Conversion Securities are then listed or quoted
on a national securities exchange or a regional securities exchange, all such securities
issuable upon conversion shall, upon issuance, also be so listed or quoted.




(E) The Company will at all times after the effective date of the Charter Amendment while
the Series C Preferred Stock is outstanding (the “Conversion Period”), have
authorized and reserved solely for purposes of the conversion hereof, free from preemptive
rights, a sufficient number of shares of its Common Stock or other Conversion Securities to
provide for the conversion in full of the Series C Preferred Stock. If at any time during
the Conversion Period the number of authorized but unissued shares of Common Stock or other
Conversion Securities shall not be sufficient to permit conversion in full of the Series C
Preferred Stock, the Company will as promptly as practicable take such corporate action as
shall be necessary to increase its authorized but unissued shares of Common Stock or other
Conversion Securities to such number of shares as shall be sufficient for such purposes.




(F) If at any time the Conversion Securities shall include any shares or other securities
other than shares of Common Stock, or any other property or assets, the terms of the



7









 






Series C Preferred Stock shall be modified or supplemented (and in the absence of express
written documentation thereof, shall be deemed to be so modified or supplemented), and the
Company shall take all actions as may be necessary to preserve, in a manner and on terms as
nearly equivalent as practicable to the provisions of the Series C Preferred Stock as they
apply to the Common Stock, the rights of the holder hereof, including any equitable
replacements of the term “Common Stock” with the term
“Conversion Securities” and
adjustments of any formula included herein.




(G) The Company will not, by amendment of its Charter, bylaws or other governing documents
or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue
or sale of securities or any other 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 the
Series C Preferred Stock and in the taking of all such action as may be necessary or
appropriate in order to protect the conversion rights of the holder against impairment or
dilution consistent with the intent and principles expressed herein. If any event or
occurrence shall occur (including without limitation, stock dividends and stock splits) as
to which the failure to make any adjustment to the Number of Outstanding Shares, the
Conversion Ratio and/or the number of shares or other assets or property issuable upon
conversion of the Series C Preferred Stock would adversely affect the conversion rights or
value represented by the Series C Preferred Stock, including any issuance of Common Stock or
Participating Securities, then, in each such case, the Board of Directors, acting in good
faith, shall determine the adjustment, if any, on a basis consistent with the essential
intent and principles herein, necessary to preserve, without dilution, the conversion rights
and value represented by the Series C Preferred Stock. Notice of each such determination
shall be given to each holder of the Series C Preferred Stock within 10 days of such
determination in the manner set forth in Section 17. For so long
as the Trust holds any shares of Series C Preferred Stock, the trustees of the Trust may object in writing to the
Board of Directors’ determination within 10 Business Days of receipt of written notice
thereof. If the Board of Directors and the trustees of the Trust are unable to agree on the
adjustment during the 10-Business Day period following the delivery of the trustees’
objection, the Appraisal Procedure may be invoked by either party to determine the
adjustment by delivery of a written notification thereof not later than the 30th
day after delivery of the trustees’ objection. “Appraisal Procedure” means a
procedure whereby two independent appraisers, one chosen by the Board of Directors and one
by the trustees of the Trust, shall mutually agree upon the adjustment. 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 adjustment, 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 or
number, as applicable, 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 holders of the



8









 






Series C Preferred Stock; otherwise, the average of all three determinations shall be
binding upon the Company and the holders of the Series C Preferred Stock. The costs of
conducting any Appraisal Procedure shall be borne by the Company. Without limiting the
foregoing, in the event of any dividend or distribution by the Company of assets or property
(including shares of any other Person) on or with respect to the Common Stock, or any
exchange of the shares of Common Stock into any other assets, property or securities, the
Series C Preferred Stock will be equitably adjusted to permit the holder to receive upon
conversion the assets, property or securities that would have been received if the Series C
Preferred Stock had been converted immediately prior to the earlier of the record date and
the effective date for such dividend, distribution or exchange.




(H) In the event (i) the Company takes a record of the holders of any class of securities
for the purpose of determining the holders thereof who are entitled to receive any dividend
or other distribution, (ii) the Company authorizes the granting to the holders of Common
Stock (or holders of any other class of Conversion Securities) of rights to subscribe to or
purchase any shares of capital stock of any class or securities convertible into any shares
of capital stock or of any other right, (iii) the Company authorizes any reclassification
of, or any recapitalization involving, any class of Common Stock or any consolidation or
merger to which the Company is a party and for which approval of the stockholders of the
Company is required, or of the sale or transfer of all or substantially all of the assets of
the Company, (iv) the Company authorizes or consents to or otherwise commences the voluntary
or involuntary dissolution, liquidation or winding up of the Company or (v) the Company
authorizes or takes any other action that would trigger an adjustment in the Number of
Outstanding Shares, the Conversion Ratio or the number or amount of shares of Common Stock
or other Conversion Securities issuable upon conversion of the Series C Preferred Stock, the
Company shall mail to the holder, at least ten (10) days prior to the earlier of the record
date for any such action or stockholder vote and the date of such action, a notice
specifying (a) which action is to be taken and the date on which any such record is to be
taken for the purpose of any such action, (b) the date that any such action is to take place
and (c) the amount and character of any stock, other securities or property, or rights or
options with respect thereto, proposed to be issued, granted or delivered to each holder of
Common Stock (or holders of any other class of Conversion Securities).




(I) The initial issuance of Common Stock upon any conversion of the Series C Preferred Stock
shall be made without charge to the exercising holder for any transfer, stamp or similar tax
or for any other governmental charges that may be imposed in connection with the issuance of
such stock, and such stock shall be issued in the respective names of, or in such names as
may be directed by, the holder; provided, however, that the Company shall
not be required to pay any tax or such other charges that may be payable in connection with
any transfer involved in the issuance of any such stock, any new shares of Series C
Preferred Stock or other securities in a name other than that of the holder upon conversion
of the Series C Preferred Stock, and the Company shall not be required to issue or deliver
such stock or other securities unless and until the Person or Persons requesting the
issuance thereof shall have paid to the Company the amount of such tax or shall have
established to the satisfaction of the Company that such tax has been paid or is not
payable.



9









 






(J) If a share of Series C Preferred Stock in certificated form is lost, stolen, mutilated
or destroyed, the Company shall, on reasonable and customary terms as to indemnity or other
customary administrative matters (which shall, in the case of a mutilated share, include the
surrender thereof), issue a new share of Series C Preferred Stock of like number as the
share so lost, stolen, mutilated or destroyed. Any such new share shall constitute an
original share, whether or not the allegedly lost, stolen, mutilated or destroyed security
shall be at any time enforceable by anyone.




(K) The Company will at no time close its transfer books during normal business hours on any
Business Day against the transfer of any shares of Common Stock issued or issuable upon the
conversion of any Series C Preferred Stock in any manner that interferes with the timely
conversion of the Series C Preferred Stock.




(L) Conversion Mechanics.




     (i) A conversion shall be deemed to have been effected at the
close of business on the Conversion Date. Immediately upon conversion, the rights of the
holders of Series C Preferred Stock converted on the Conversion Date shall cease and the
persons entitled to receive the shares of Common Stock upon the conversion of such shares of
Series C Preferred Stock shall be treated for all purposes as having become the record and
beneficial owners of such shares of Common Stock.




     (ii) As promptly as practicable after the Conversion Date (and in no event more than
two (2) Business Days thereafter), the Company shall deliver or cause to be delivered at the
office or agency of the Conversion Agent, to, or upon the written order of, the holders of
the surrendered shares of Series C Preferred Stock, a notice pursuant to direct registration
that a number of fully paid and nonassessable shares of Common Stock have been registered on
the books and records of the Company, with no personal liability attaching to the ownership
thereof, free of all taxes with respect to the issuance thereof to the extent provided in
Section 11(A) and (I), liens, charges and security interests (other than liens or charges
created by the holder of the Series C Preferred Stock, income and franchise taxes incurred
in connection with the conversion of the Series C Preferred Stock or taxes in connection
with any transfer occurring prior to or contemporaneously therewith) and not subject to any
preemptive rights, into which such shares of Series C Preferred Stock have been converted in
accordance with the provisions of this Section 11 and any cash payable in respect of
fractional shares as provided herein. On the relevant payment date following the Conversion
Date, the Company shall deliver or cause to be delivered at the office or agency of the
Conversion Agent, to, or upon the written order of, the holders of the surrendered shares of
Series C Preferred Stock, the amount of cash or other property, if any, due in respect of
dividends or other distributions on such surrendered shares, as provided in Section
11(A)(i)(y), payable, in the case of cash dividends or distributions (i) if the holder is
the Trust, in immediately available funds, at such account designated by the holder or (ii)
otherwise by check delivered to the holder at its address as set forth on the books and
records of the Company.




     (iii) Upon the surrender of a certificate representing shares of Series C Preferred
Stock that is converted in part, the Company shall deliver or cause to be



10









 







delivered to the holder a notice that shares of Series C Preferred Stock equal in
number to the unconverted shares of Series C Preferred Stock represented by the certificate
so surrendered have been registered on the books and records of the Company.




(M) No Fractional Shares. No fractional shares or scrip representing fractional
shares of Common Stock or other Conversion Securities shall be issued upon the conversion of
any shares of Series C Preferred Stock. Instead of any fractional interest in a share of
Common Stock or other Conversion Security that would otherwise be deliverable upon the
conversion of a share of Series C Preferred Stock, the Company shall pay to the holder of
such share of Series C Preferred Stock an amount in cash (computed to the nearest cent)
equal to the product of (i) such fraction and (ii) the Current Market Price Per Share on the
Trading Day (as defined below) next preceding the day of conversion. For the purposes of
any computation under this Section 11, the “Current Market Price Per Share” of the
Common Stock or any other security on any Trading Day shall be deemed to be the volume
weighted average sales price of the Common Stock or such other security on the New York
Stock Exchange on such Trading Day (or, if the Common Stock or such other security is not
listed on the New York Stock Exchange, such other national or regional exchange or market in
the United States on which the Common Stock or such other security is then listed or quoted)
or, if the Common Stock or such other security is not listed or quoted on a national or
regional exchange or market, the last quoted price or, if not so quoted, the average of the
high bid and low asked prices on such other nationally recognized quotation system then in
use in the United States on such Trading Day, or, if the Common Stock or such other security
is not quoted on any such quotation system, the average of the closing bid and asked prices
on such Trading Day as furnished by a professional market maker selected by the Board of
Directors in good faith making a market in the Common Stock or such other security. Any
determination of Current Market Price Per Share shall be made without reference to extended
or after hours trading.


Section 12. Form.





(A) Series C 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 and the Registrar, the restricted shares legend (the
“Restricted Shares Legend”), as set forth on the form of Series C Perpetual,
Convertible, Participating Preferred Stock certificate attached hereto as Exhibit A (each, a
“Preferred Share Certificate”), which is hereby incorporated in and expressly made a
part of this Certificate of Designations. The 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) (i) An Officer shall sign the Preferred Share Certificate for the Company, in accordance
with the Company’s bylaws and applicable law, by manual or facsimile signature.



11









 






     (ii) If an Officer whose signature is on a Preferred Share Certificate no longer holds
that office at the time the Transfer Agent authenticates such Preferred Share Certificate,
such Preferred Share Certificate shall be valid nevertheless.




     (iii) A Preferred Share Certificate shall not be valid or obligatory until an
authorized signatory of the Transfer Agent manually countersigns the Preferred Share
Certificate. The signature shall be conclusive evidence that such Preferred Share
Certificate has been authenticated under this Certificate of Designations. Each Preferred
Share Certificate shall be dated the date of its authentication.




(C) Other than upon original issuance, all transfers, conversions and exchanges of the
Series C Preferred Stock shall be made by direct registration on the books and records of
the Company.


Section 13. Registration; Transfer.





(A) The Series C Preferred Stock and the Common Stock issuable upon conversion of the shares
of Series C Preferred Stock have not been registered under the Securities Act and may not be
resold, pledged or otherwise transferred other than (i) pursuant to an exemption from the
registration requirements of the Securities Act provided by Rule 144 thereunder, (ii) in
accordance with another exemption from the registration requirements of the Securities Act,
(iii) to the Company or a subsidiary thereof, or (iv) pursuant to an effective registration
statement under the Securities Act, in each case, in accordance with any applicable
securities laws of any state of the United States.




(B) Except in connection with a transfer pursuant to an effective registration statement
relating to the Series C Preferred Stock and shares of Common Stock issuable on conversion
of the Series C Preferred Stock, if shares of Series C Preferred Stock are issued upon the
transfer, exchange or replacement of Series C Preferred Stock bearing the Restricted Shares
Legend, or if a request is made to remove such Restricted Shares Legend on shares of Series
C Preferred Stock, the Series C Preferred Stock so issued shall be subject to the transfer
restrictions set forth in the Restricted Shares Legend and such restrictions shall continue
to apply unless there is delivered to the Company and the Registrar such satisfactory
evidence, which may include an opinion of counsel licensed to practice law in the State of
New York, as may be reasonably required by the Company or the Registrar, that such
restrictions on transfer are not required to ensure that transfers thereof comply with the
provisions of Rule 144 under the Securities Act or that such shares of Series C Preferred
Stock are not “restricted securities” within the meaning of Rule 144 under the Securities
Act. Upon provision of such satisfactory evidence, the Registrar, at the direction of the
Company, shall notify the holder that such shares of Series C Preferred Stock are no longer
subject to the transfer restrictions set forth in the Restricted Shares Legend.




(C) The Company will refuse to register any transfer of Series C Preferred Stock or any
Common Stock issuable upon conversion of the shares of Series C Preferred Stock that is not
made in accordance with the provisions of the Restricted Shares Legend and pursuant to an
effective registration statement under the Securities Act or pursuant to Rule 144 or



12









 






another available exemption from the registration requirements of the Securities Act;
provided that the provisions of this paragraph (C) shall not be applicable to any
Series C Preferred Stock that is not subject to the restrictions set forth in the Restricted
Shares Legend or to any Common Stock that is not subject to the Common Stock Legend.




(D) Each notice of issuance of Common Stock issued upon a conversion of the Series C
Preferred Stock prior to the transfer of such Series C Preferred Stock pursuant to Rule 144
or an effective registration statement relating to such Series C Preferred Stock shall be
subject to the common stock legend (the “Common Stock Legend”) set forth in Exhibit
C hereto and be transferable only in accordance with the Form of Certificate of Transfer for
Common Stock set out in Exhibit D. If shares of Common Stock subject to the Common Stock
Legend are transferred by such holder, then the holder must deliver to the Registrar a
certificate in substantially the form of Exhibit D as to compliance with the restrictions on
transfer applicable to such Common Stock and the Registrar shall not be required to register
any transfer of such Common Stock not so accompanied by a properly completed certificate.
Upon the presentation of satisfactory evidence that the transfer restrictions set forth in
Common Stock Legend are no longer required as described above in paragraph (B) of this
Section with respect to the Series C Preferred Stock, the Registrar, at the direction of the
Company, shall notify the holder that such shares of Common Stock are no longer subject to
the transfer restrictions set forth in the Common Stock Legend.




(E) The Company will refuse to register any transfer of the Series C Preferred Stock or the
Conversion Securities unless the transferor first pays all transfer taxes or similar taxes
required to be paid on such transfer.


Section 14. Transfer Agent, Conversion Agent and Registrar. The duly appointed Transfer
Agent, Conversion Agent and Registrar for the Series C 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 15. Other Rights. The shares of the Series C 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, the bylaws of the Company or as provided by applicable law.



Section 16. Record Holders. To the fullest extent permitted by applicable law, the Company
and the Transfer Agent for Series C Preferred Stock may deem and treat the record holder of any
share of the Series C 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 17. Notices. All notices or communications in respect of the Series C Preferred
Stock shall be sufficiently given if given in writing and delivered in person or by first class
mail, postage prepaid, or given in such other manner as may be permitted in this Certificate of
Designations, in the Charter, the bylaws of the Company or by applicable law. Notwithstanding


13









 






the foregoing, if shares of the Series C 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 C Preferred Stock in any manner permitted by such facility.



Section 18. No Preemptive Rights. No holder of any share of Series C Preferred Stock shall
be entitled as of right to subscribe for, purchase or receive any shares of stock of any class or
any other securities which the Company may issue, whether now or hereafter authorized, and whether
such stock or securities be issued for money or for a consideration other than money or by way of a
dividend and all such shares of stock or other securities may be issued or disposed of by the Board
of Directors to such persons, firms, corporations and associates and on such terms as it, in its
absolute discretion, may deem advisable, without offering to stockholders then of record of any
share of Series C Preferred Stock upon the same terms or upon any terms.



Section 19. Definitions. (A) The following terms shall have the respective meanings set
forth below:




     “2008 Warrants” shall mean the warrant issued by the Company to the United States
Department of the Treasury concurrently with the issuance of the Series D Preferred Stock.



     “Business Day” shall mean any day other than a Saturday, Sunday or day on which banks
in New York City are authorized or required by law to close.



     “Charter” means the Company’s Restated Certificate of Incorporation, as amended from
time to time.



     “Charter Amendment” shall mean an amendment to the Charter 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” shall mean the common stock, $2.50 par value, of the Company, the
common stock of the Company with any other par value or no par value, and all other stock of any
class or classes (however designated) of the Company from time to time outstanding, the holders of
which have the right, without limitation as to amount, either to all or to a share of the balance
of current dividends or liquidating distributions after the payment of dividends and distributions
on any shares entitled to preference. For purposes of clarification, the Common Stock shall not
include the Series C Preferred Stock.



     “Conversion Ratio” as of any date shall mean the quotient obtained by dividing (x) the
Number of Underlying Shares as of such date by (y) 100,000.



     “Credit Agreement” means the Credit Agreement, dated as of September 22, 2008, between
the Company and Federal Reserve Bank of New York, as amended from time to time.



     “Equity Units” means the Equity Units issued by the Company pursuant to a Purchase
Contract Agreement dated May 16, 2008 between the Company and The Bank of New York.




14











 





     “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to
time.



     “Number of Outstanding Shares” means, as of any date, the number of shares of Common
Stock outstanding as of the date hereof plus the number of shares of Common Stock issued on or
prior to such date in settlement of the Equity Units.



     “Number of Underlying Shares” means, as of any date, a number of shares of Common
Stock equal to the excess of (a) the product of 3.9751244 times the Number of Outstanding Shares as
of such date over (b) the sum of (i) 53,798,766 (the number of shares of Common Stock underlying
the 2008 Warrants as of the date hereof), (ii) the initial number of shares of Common Stock
underlying any warrants or other securities convertible into, exchangeable for or representing the
right to receive shares of Common Stock (other than the Series C Preferred Stock and the 2008 Warrants)
that are beneficially owned by the Treasury (or any vehicle on its behalf) and (iii) so long as any
shares of Series C Preferred Stock are beneficially owned by the Treasury (or any vehicle on its
behalf), any shares of Common Stock directly owned by the Treasury (or any vehicle on its behalf )
as of such date other than (A) the shares of Common Stock referred to in (i) and (ii) above and (B) any
shares of Common Stock received upon conversion of the Series C Preferred Stock.



     “Officer” means the Chairman, any Vice President, the Treasurer or the Secretary of
the Company.



     “Participating Securities” shall mean (i) any equity security (other than Common
Stock) that entitles the holders thereof to participate in liquidations or other distributions with
the holders of Common Stock or otherwise participate in the capital of the Company other than
through a fixed or floating rate of return on capital loaned or invested, and (ii) any stock
appreciation rights, phantom stock rights, or any other profit or other economic participation
rights with respect to any of the Company’s capital stock or other equity ownership interest, or
any rights or options to acquire any such rights.



     “Person” shall mean any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust, estate, unincorporated
organization or government or any agency or political subdivision thereof, or any other entity
whatsoever.



     “Preferred Stock” means any and all series of preferred stock of the Company,
including the Series C Preferred Stock and Series D Preferred Stock.



     “Ranking Amendment” means an amendment to the Charter (A) to permit the Board of Directors to issue classes of
Preferred Stock that are not of equal rank, such that the Board of Directors or a duly authorized
committee thereof may, prior to issuance, in the resolution or resolutions providing for the issue
of shares of each particular series, provide whether the shares of such series rank senior or
junior to any other class of Preferred 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 and (B) to cause the Series D Preferred Stock and any
other series of Preferred Stock subsequently issued to the United States Department of the Treasury
to rank senior to the Series C Preferred Stock and any other subsequently issued series of
Preferred Stock that is not issued to the United States Department of the Treasury, so that as a
result of these amendments the Series C Preferred Stock and any subsequently issued series of
Preferred Stock that ranks pari passu with or junior to the Series C Preferred Stock would not be
entitled to vote on the subsequent creation or issuance of any such senior Serial Preferred Stock.



     “Securities Act” means the Securities Act of 1933, as amended from time to time.



     “Series D Preferred Stock” means the Series D Fixed Rate Cumulative Perpetual
Preferred Stock of the Company.



15









 





     “Threshold Percentage” means a quotient obtained by dividing (x) the Number of
Underlying Shares by (y) the sum of the Number of Underlying Shares and the Number of Outstanding
Shares and expressed as a percentage.



     “Trading Day” shall mean any day during which the Common Stock or other Conversion
Security trades regular way on the New York Stock Exchange or, if the Common Stock or other
Conversion Security is not listed on the New York Stock Exchange, on the principal other national
or regional securities exchange on which the Common Stock or other Conversion Security is then
listed or, if the Common Stock or other Conversion Security is not listed on a national or regional
securities exchange, on the principal other market on which the Common Stock or other Conversion
Security is then traded.



     “Treasury” means either the United States Department of the Treasury or the United
States Treasury.



     “Trust” means the AIG Credit Facility Trust, a trust established for the benefit of
the United States Treasury, or any successor thereto.


(B) The terms “junior stock” and “sinking fund” shall have the respective meanings set forth
in subdivision (7) of Article Four of the Charter.




16









 

'



     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 March,
2009.



	 	 	 	 	 
	 	AMERICAN INTERNATIONAL GROUP, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



ATTEST:



 




Name:

Title: Secretary




 









 





Signature Page to Certificate of Designations of Series C Perpetual, Convertible,

Participating Preferred Stock of American International Group, Inc.




2









 





EXHIBIT A




FORM OF SERIES C PERPETUAL, CONVERTIBLE, PARTICIPATING PREFERRED STOCK




	 	 	 	 	 	 	 
	Number:



	 	 	 	 	 	Shares
	 

	 	 
	 	 	 	 
	 
	CUSIP NO.:
	 	 	 	 	 	 
	 

	 	 	 	 	 	 






Series C Perpetual, Convertible, Participating Preferred Stock

(par value $5.00 per share)

(liquidation preference $5.00 per share)

OF

AMERICAN INTERNATIONAL GROUP, INC.




FACE OF SECURITY



TRANSFERS OF THIS CERTIFICATE OR PORTIONS THEREOF SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE
WITH THE RESTRICTIONS SET FORTH IN THE CERTIFICATE OF DESIGNATIONS REFERRED TO BELOW.



IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT SUCH
CERTIFICATES AND OTHER INFORMATION AS SUCH REGISTRAR AND TRANSFER AGENT MAY REASONABLY REQUIRE TO
CONFIRM THAT TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.



THIS SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE
SECURITIES LAWS. NEITHER THIS SECURITY OR THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF
THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.




 









 







AMERICAN INTERNATIONAL GROUP, INC., a Delaware corporation (the “Company”), hereby certifies that
AIG Credit Facility Trust or its registered assigns (the “Holder”) is the registered owner of a
number of fully paid and non-assessable shares of preferred stock of the Company designated the
Series C Perpetual, Convertible, Participating Preferred Stock, par value $5.00 per share and
liquidation preference $5.00 per share (the “Series C Preferred Stock”), specified above. The
shares of Series C Preferred Stock are transferable on the books and records of the Registrar, in
person or by a duly authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer. The designation, rights, privileges, restrictions, preferences and other
terms and provisions of the Series C Preferred Stock represented hereby are specified in and shall
in all respects be subject to the provisions of the Certificate of Designations of the Company
dated March 4, 2009, as the same may be amended from time to time in accordance with its terms
(the “Certificate of Designations”). Capitalized terms used herein but not defined shall have the
respective meanings given them in the Certificate of Designations. The Company will provide a copy
of the Certificate of Designations to a Holder without charge upon written request to the Company
at its principal place of business.



Reference is hereby made to select provisions of the Series C Preferred Stock set forth on the
reverse hereof, and to the Certificate of Designations, which select provisions and the Certificate
of Designations shall for all purposes have the same effect as if set forth at this place.



Upon receipt of this certificate, the Holder is bound by the Certificate of Designations and is
entitled to the benefits thereunder.



Unless the Transfer Agent’s Certificate of Authentication hereon has been properly executed, the
shares of Series C Preferred Stock evidenced hereby shall not be entitled to any benefit under the
Certificate of Designations or be valid or obligatory for any purpose.




 









 







IN WITNESS WHEREOF, American International Group, Inc. has executed this certificate as of the date
set forth below.




	 	 	 	 	 
	 	AMERICAN INTERNATIONAL GROUP, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  

Dated: ________________ 	 
	 



TRANSFER AGENT’S CERTIFICATE OF AUTHENTICATION



This is one of the certificates representing shares of Series C Perpetual, Convertible,
Participating Preferred Stock referred to in the within mentioned Certificate of Designations.




	 	 	 	 	 
	 	WELLS FARGO BANK, N.A.,

as Transfer Agent

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	Authorized Signatory


	 
	 	 	Dated: ________________ 	 



 









 






	 	 	 	 	 



REVERSE OF SECURITY




AMERICAN INTERNATIONAL GROUP, INC.




Series C Perpetual, Convertible, Participating Preferred Stock



Dividends on each share of Series C Preferred Stock shall be payable as provided in the Certificate
of Designations.



The shares of Series C Preferred Stock shall have the voting rights set forth in the Certificate of
Designations.



The shares of Series C Preferred Stock shall not be redeemable or subject to a sinking fund.



The shares of Series C Preferred Stock shall have no maturity.



The shares of Series C Preferred Stock shall be convertible into the Company’s Common Stock in the
manner and according to the terms set forth in the Certificate of Designations.



The transfer or exchange of any shares represented by this certificate and the issuance and
delivery of shares of Common Stock upon the conversion of all or part of the shares represented by
this certificate shall be effected on the books and records of the Company and no certificates
representing such shares shall be delivered.



As required under Delaware law, the Company shall furnish to any Holder upon request and without
charge, a full summary statement of the designations, voting rights preferences, limitations and
special rights of the shares of each class or series authorized to be issued by the Company so far
as they have been fixed and determined.




 









 





ASSIGNMENT




     FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto:


 



 




(Insert assignee’s social security or other identifying number)



 




(Insert address and zip code of assignee)



 



 



shares of capital stock represented by the within Certificate and hereby irrevocably constitutes
and appoints:



 




agent to transfer the said stock on the books of the Transfer Agent and Registrar with full power

of substitution in the premises.




Date:



 




Signature:




 




(Sign exactly as your name appears on the other side of this Series C Preferred Stock Certificate)




	 	 	 	 	 
	Signature Guarantee:

	 	 	 	1
	 

	 	 	 	 








 




			
	1	 	Signature must be guaranteed by an “eligible guarantor
institution” (i.e., a bank, stockbroker, savings and loan association or credit
union) meeting the requirements of the Registrar, which requirements include
membership or participation in the Securities Transfer Agents Medallion Program
(“STAMP”) or such other “signature guarantee program” as may be determined by
the Registrar in addition to, or in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as amended from time to time.




 









 





NOTICE OF CONVERSION




(To be Executed by the Registered Holder in order to Convert the Series C Preferred Stock)



The
undersigned hereby irrevocably elects to convert (the “Conversion”) ___ shares of Series C
Perpetual, Convertible, Participating Preferred Stock (the “Series C Preferred Stock”), represented
by stock certificate No(s). ___ (the “Series C Preferred Stock Certificates”) into shares of common
stock (the “Common Stock”), of American International Group, Inc. (the “Company”) according to the
conditions of the Certificate of Designations dated March 4, 2009 establishing the terms of the
Series C Preferred Stock, as such may be amended from time to time (the “Certificate of
Designations”), as of the date written below. If shares are to be issued in the name of a person
other than the undersigned, the undersigned will pay all transfer taxes payable with respect
thereto and is delivering herewith such certificates. No fee will be charged to the holder for any
conversion, except for transfer taxes, if any. [A copy of each Series C Preferred Stock Certificate
is attached hereto (or evidence of loss, theft or destruction thereof).]1



The undersigned represents and warrants that all offers and sales by the undersigned of the shares
of Common Stock issuable to the undersigned upon conversion of the Series C Preferred Stock shall
be made pursuant to registration of the Common Stock under the Securities Act of 1933, as amended
from time to time (the “Act”), or pursuant to an exemption from registration under the Act.



[The Company is not required to issue shares of Common Stock until the original Series C Preferred
Stock Certificate(s) (or evidence of mutilation, loss, theft or destruction thereof) to be
converted are received by the Company or its Transfer Agent.] The Company shall record the issuance
of the shares of Common Stock on its books and records by direct registration not later than two
business days following receipt of the original Series C Preferred Stock Certificate(s) to be
converted or, if the Series C Preferred Stock is not represented by a Series C Preferred Stock
Certificate, no later than two business days following receipt of this Notice of Conversion. The
holder acknowledges that no certificates shall be issued in respect of the shares of Common Stock
or any shares evidenced by Series C Preferred Stock Certificate(s) that are not converted.



Capitalized terms used but not defined herein shall have the meanings ascribed thereto in or
pursuant to the Certificate of Designations.




	 	 	 	 	 
	Date of Conversion:
	 	 	 	 
	 	 	 
	Applicable Conversion Ratio:
	 	 	 	 
	 	 	 
	Number of shares of Series C
Preferred Stock to be Converted:
	 	 	 	 
	 	 	 
	Number of shares of
Common Stock to be Issued:
	 	 	 	 
	 	 	 
	Signature:
	 	 	 	 
	 	 	 
	Name:
	 	 	 	 
	 	 	 
	Address:2
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 	 	 
	Fax No.:
	 	 	 	 
	 	 	 








 




			
	1	 	Delete bracketed language if this Notice of Conversion is used with respect
to uncertificated shares.
	 
	2	 	Address where shares of Common Stock and any other payments or certificates shall be
sent by the Company, if applicable.



















 





NOTICE OF CONVERSION




(To be Executed by the Registered Holder in order to Convert the Series C Preferred Stock)





	 	 	The undersigned hereby irrevocably elects to convert (the
“Conversion”) ___ shares of Series C
Perpetual, Convertible, Participating Preferred Stock (the “Series C Preferred Stock”), represented
by stock certificate No(s). ___ (the “Series C Preferred Stock Certificates”) into shares of common
stock (the “Common Stock”), of American International Group, Inc. (the “Company”) according to the
conditions of the Certificate of Designations dated March [3], 2009 establishing the terms of the
Series C Preferred Stock, as such may be amended from time to time (the “Certificate of
Designations”), as of the date written below. If shares are to be issued in the name of a person
other than the undersigned, the undersigned will pay all transfer taxes payable with respect
thereto and is delivering herewith such certificates. No fee will be charged to the holder for any
conversion, except for transfer taxes, if any. [A copy of each Series C Preferred Stock Certificate
is attached hereto (or evidence of loss, theft or destruction thereof).]2
	 
	 	 	The undersigned represents and warrants that all offers and sales by the undersigned of the shares
of Common Stock issuable to the undersigned upon conversion of the Series C Preferred Stock shall
be made pursuant to registration of the Common Stock under the Securities Act of 1933, as amended
from time to time (the “Act”), or pursuant to an exemption from registration under the Act.
	 
	 	 	[The Company is not required to issue shares of Common Stock until the original Series C Preferred
Stock Certificate(s) (or evidence of mutilation, loss, theft or destruction thereof) to be
converted are received by the Company or its Transfer Agent.] The Company shall record the issuance
of the shares of Common Stock on its books and records by direct registration not later than two
business days following receipt of the original Series C Preferred Stock Certificate(s) to be
converted or, if the Series C Preferred Stock is not represented by a Series C Preferred Stock
Certificate, no later than two business days following receipt of this Notice of Conversion. The
holder acknowledges that no certificates shall be issued in respect of the shares of Common Stock
or any shares evidenced by Series C Preferred Stock Certificate(s) that are not converted.
	 
	 	 	Capitalized terms used but not defined herein shall have the meanings ascribed thereto in or
pursuant to the Certificate of Designations.





	 	 	 	 	 
	Date of Conversion:
	 	 	 	 
	 
	 	 	 	 
	Applicable Conversion Ratio:
	 	 	 	 
	 
	 	 	 	 
	Number of shares of Series C
Preferred Stock to be Converted:
	 	 	 	 
	 
	 	 	 	 
	Number of shares of
Common Stock to be Issued:
	 	 	 	 
	 
	 	 	 	 
	Signature:
	 	 	 	 
	 
	 	 	 	 
	Name:
	 	 	 	 
	 
	 	 	 	 








 




			
	2	 	Delete bracketed language if this Notice of Conversion
is used with respect to uncertificated shares.




 









 










	 	 	 	 	 
	Address:3
	 	 
	 
	 	 	 
	 
	 	 
	 
	 	 	 
	 
	 	 
	Fax No.:
	 	 
	 

	 	 	 








 




			
	3	 	Address where shares of Common Stock and any other
payments or certificates shall be sent by the Company, if applicable.




 









 










EXHIBIT B




FORM OF CERTIFICATE OF TRANSFER FOR SERIES C PREFERRED STOCK

(Transfers pursuant to Section 13 of the Certificate of Designations)




Wells Fargo Bank, N.A., as Transfer Agent

Shareowner Services

161 North Concord Exchange Street

South St. Paul, MN 55075-1139

Attn: Suzanne M. Swits





	Re: 	 	American International Group, Inc.

Series C Perpetual, Convertible, Participating Preferred Stock (the “Series C Preferred Stock”)




Reference is hereby made to the Certificate of Designations relating to the Series C Preferred
Stock dated March 4, 2009, as such may be amended from time to time (the “Certificate of
Designations”). Capitalized terms used but not defined herein shall have the respective meanings
given them in the Certificate of Designations.



This letter relates to ___shares of the Series C Preferred Stock (the “Securities”) which are
held in the form of [a Preferred Share Certificate bearing/uncertificated shares subject to the
restrictions set forth in] the Restricted Share(s) Legend (CUSIP NO. ) in the
name of [name of transferor] (the “Transferor”) to effect the transfer of the Securities.



In connection with such request, and in respect of the Securities, the Transferor does hereby
certify that the Securities are being transferred (i) in accordance with applicable securities laws
of any state of the United States or any other jurisdiction and (ii) in accordance with their
terms:



CHECK ONE BOX BELOW:




	 	 	 	 	 
	(1)

	 	o
	 	pursuant to an exemption from registration under the Securities Act of
1933, as amended from time to time (the “Securities Act”), provided by Rule 144 thereunder;
	(2)

	 	o
	 	in accordance with another exemption from the registration requirements
of the Securities Act;
	(3)

	 	o
	 	to the Company or a subsidiary thereof; or
	(4)

	 	o
	 	pursuant to an effective registration statement under the Securities Act.






     Unless one of the boxes is checked, the Transfer Agent will refuse to register any of the
Securities in the name of any person other than the registered holder thereof; provided, however,
that if box (1) or (2) is checked, the Transfer Agent shall be entitled to require, prior to
registering any such transfer of the Securities, such legal opinions, certifications and other



 









 







information as the Company has reasonably requested to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the registration requirements of
the Securities Act, such as the exemption provided by Rule 144 under the Securities Act.



	 	 	 	 	 
	 	[Name of Transferor]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



Dated:



 





	cc:	 	American International Group, Inc.

70 Pine Street

New York, New York 10270

Attn: Secretary







 









 








EXHIBIT C




FORM OF COMMON STOCK LEGEND



“THE SECURITIES REFERRED TO HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. NEITHER SUCH SECURITIES NOR ANY
INTEREST OR PARTICIPATION THEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION
IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.”




 









 








EXHIBIT D




FORM OF CERTIFICATE OF TRANSFER FOR COMMON STOCK

(Transfers pursuant to Section 13 of the Certificate of Designations)




Wells Fargo Bank, N.A., as Transfer Agent

Shareowner Services

161 North Concord Exchange Street

South St. Paul, MN 55075-1139

Attn: Suzanne M. Swits





	Re:	 	American International Group, Inc.

Series C Perpetual, Convertible, Participating Preferred Stock (the “Series C Preferred Stock”)





Reference is hereby made
to the Certificate of Designations relating to the Series C Preferred
Stock dated March 4, 2009, as such may be amended from time to time (the “Certificate of
Designations”). Capitalized terms used but not defined herein shall have the respective meanings
given them in the Certificate of Designations.


This letter relates to ___shares of Common Stock (the “Securities”) that were issued upon
conversion of the Series C Preferred Stock and which are held in the name of [name of transferor]
(the “Transferor”) to effect the transfer of the Securities.


In connection with such request, and in respect of the Securities, the Transferor does hereby
certify that the Securities are being transferred (i) in accordance with applicable securities laws
of any state of the United States or any other jurisdiction and (ii) in accordance with their
terms:


CHECK ONE BOX BELOW:




	 	 	 	 	 
	(1)

	 	o
	 	pursuant to an exemption from registration under the Securities Act of
1933, as amended from time to time (the “Securities Act”), provided by Rule 144
thereunder;
	(2)

	 	o
	 	in accordance with another exemption from the registration requirements
of the Securities Act;
	(3)

	 	o
	 	to the Company or a subsidiary thereof; or
	(4)

	 	o
	 	pursuant to an effective registration statement under the Securities Act.





Unless one of the boxes is checked, the Transfer Agent will refuse to register any of the
Securities in the name of any person other than the registered holder thereof; provided, however,
that if box (1) or (2) is checked, the Transfer Agent shall be entitled to require, prior to
registering any such transfer of the Securities, such legal opinions, certifications and other
information as the Company has reasonably requested to confirm that such transfer is being


 









 






made pursuant to an exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act, such as the exemption provided by Rule 144 under the Securities
Act.




	 	 	 	 	 
	 	[Name of Transferor]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 




	 	 	 	 	 
	Dated:  	 	  	 







	cc: 	 	American International Group, Inc.

70 Pine Street

New York, New York 10270

Attn: Secretary






 











 





EXHIBIT B




[FORM OF OPINION OF SULLIVAN & CROMWELL LLP]




 









 







March 4, 2009




AIG Credit Facility Trust

c/o Kevin F. Barnard

Arnold & Porter LLP

399 Park Avenue

New York, New York 10022,



Ladies and Gentlemen:




     In connection with the purchase today by AIG Credit Facility Trust, a trust established for
the benefit of the United States Treasury (the “Trust”), pursuant to the Series C
Perpetual, Convertible, Participating Preferred Stock Purchase Agreement, dated as of March 1, 2009
(the “Stock Purchase Agreement”), between the Trust and American International Group, Inc.,
a Delaware corporation (the “Company”), of 100,000 shares (the “Securities”) of the
Company’s Series C Perpetual, Convertible, Participating Preferred Stock, par value $5.00 per share
(the “Series C Preferred Stock”), we, as counsel for the Company, have examined such
corporate records, certificates and other documents, and such questions of law, as we have
considered necessary or appropriate for the purposes of this opinion. Upon the basis of such
examination, it is our opinion that:




     (1) The Company has been duly incorporated and is an existing corporation in good
standing under the laws of the State of Delaware.




     (2) The Company has the corporate power and authority to execute, deliver and perform
its obligations under the Stock Purchase Agreement.




     (3) The execution, delivery and performance by the Company of the Stock Purchase
Agreement and the consummation of the transactions contemplated thereby have been duly
authorized by all necessary corporate and stockholder action (other than the actions
contemplated in Sections 6.1, 6.2, 6.3, 6.6, 6.7 (with respect to Board of Director’s
approval only) and 6.8 (with respect to clause (ii) of the second sentence only) of the
Stock Purchase Agreement).




     (4) The Stock Purchase Agreement, assuming due authorization, execution and delivery
by the Trust, constitutes a valid and legally binding agreement of the 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; provided,
however, that we express no opinion with respect to Sections 6.1, 6.2, 6.3, 6.6, 6.7 and
6.8 of the Stock Purchase Agreement or the indemnification and contribution provisions of






 








 






-2-






Section 7.1 of the Stock Purchase Agreement or the severability provisions of the Stock
Purchase Agreement insofar as Sections 6.1, 6.2, 6.3, 6.6, 6.7 and 6.8 of the
Stock Purchase Agreement or the indemnification and contribution provisions of Section
7.1 of the Stock Purchase Agreement are concerned.





     (5) The Securities have been duly authorized and, when issued and authenticated in
accordance with the provisions of the Stock Purchase Agreement, will be validly issued,
fully paid and nonassessable, and the issuance of such Securities is not subject to any
preemptive rights provided for in the Company’s Restated Certificate of Incorporation, as
amended to the date of this opinion, or under the General Corporation Law of the State of
Delaware.




     (6) Upon approval of the Common Stock Amendment Proposal (as defined in the Stock
Purchase Agreement) by the Company’s Board of Directors and stockholders, the Securities
will be convertible into shares (the “Shares”) of common stock, par value $2.50 per
share (the “Common Stock”), of the Company in accordance with the terms and
provisions of the Certificate of Designations relating to the Securities and, when issued
upon conversion of the Securities, the Shares will be validly issued, fully paid and
nonassessable, and as of the date of this opinion the issuance of such Shares is not
subject to any preemptive rights provided for in the Company’s Restated Certificate of
Incorporation, as amended to the date of this opinion, or under the General Corporation Law
of the State of Delaware.



     The foregoing opinion is limited to the Federal Laws of the United States, the laws of the
State of New York and the General Corporation Law of the State of Delaware, and we are expressing
no opinion as to the effect of the laws of any other jurisdiction.



     We have also relied as to certain matters upon information obtained from public officials,
officers of the Company and other sources believed by us to be responsible, and we have assumed
that the certificates for the Securities conform to the specimen thereof examined by us and have
been duly countersigned by a transfer agent and duly registered by a registrar of the Series C
Preferred Stock, that the certificates (if any) for the 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 of the Common Stock (and if the 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 to you by us 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,

 	 
	 	 	 
	 	 	 
	 	 	 








 





EXHIBIT C




[FORM OF OPINION OF KATHLEEN E. SHANNON, SENIOR VICE PRESIDENT,

SECRETARY AND DEPUTY GENERAL COUNSEL FOR THE COMPANY]




 









 












March 4, 2009




AIG Credit Facility Trust

c/o Kevin F. Barnard

Arnold & Porter LLP

399 Park Avenue

New York, New York 10022,



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 of the Company.



     This opinion is rendered in connection with the purchase today by AIG Credit Facility Trust, a
trust established for the benefit of the United States Treasury (the “Trust”), pursuant to
the Series C Perpetual, Convertible, Participating Preferred Stock Purchase Agreement, dated as of
March 1, 2009 (the “Stock Purchase Agreement”), between the Trust and the Company, of
100,000 shares (the “Securities”) of the Company’s Series C Perpetual, Convertible,
Participating Preferred Stock, par value $5.00 per share (the “Series C Preferred Stock”).
The Securities are being issued pursuant to the Certificate of Designations of the Series C
Preferred Stock, as filed by the Company with the Secretary of State of the State of Delaware on
March 4, 2009 (the “Certificate of Designations”), and are convertible on the terms set
forth in the Certificate of Designations into shares (the “Underlying Shares”) of the
Company’s common stock, par value $2.50 per share (the “Common Stock”). This opinion is
being delivered pursuant to Section 3.3(ii) of the Stock Purchase Agreement.



     In rendering my opinion, I, as Senior Vice President, Secretary and Deputy General Counsel of
the Company, have examined the Stock Purchase Agreement and the Certificate of Designations, and I
have examined such corporate records, certificates and other documents, including the Restated
Certificate of Incorporation of the Company, as amended and in effect as of the date hereof (the
“Charter”), and the By-Laws of the Company, as amended on June 15, 2008 and in effect as of
the date hereof (the “By-Laws”), and such questions of law, as I have considered necessary
or appropriate for the purposes of this opinion. Upon the basis of such examination, it is my
opinion that:



 









 







2




	(1)	 	The issue and sale of the Securities, the issuance of the Underlying Shares upon
conversion of the Securities following the adoption of the Common Stock Amendment Proposal
(as defined in the Stock Purchase Agreement) and the performance and compliance by the
Company of and with all of the provisions of the Stock Purchase Agreement (other than the
actions contemplated in Sections 6.1, 6.2, 6.3, 6.6, 6.7 (with respect to Board of
Director’s approval only) and 6.8 (with respect to clause (ii) of the second sentence only)
of the Stock Purchase Agreement) and the Certificate of Designations, will not to the best
of my knowledge after due investigation (i) result in violation by the Company of (A) any
provision of law, statute, rule or regulation applicable to the Company or the transactions
contemplated by the Stock Purchase Agreement, (B) any judgment, order or decree of any
court or governmental body with jurisdiction over the Company or (C) any provision of any
indenture, agreement or other instrument in effect on the date hereof and known to me, to
which the Company is a party or by which the Company is bound or to which any of the
property or assets of the Company is subject, (ii) be in conflict with, result in a breach
of, terminate or constitute (alone or with notice or lapse of time or both) a default
under, or give rise to any right to terminate or accelerate or to require the prepayment,
repurchase or redemption of any obligation under any such indenture, agreement or other
instrument or (iii) result in the creation or imposition of any Lien (as such term is used
in the Stock Purchase Agreement) upon or with respect to any property or assets of the
Company, except, in the case of (i)(A) above, for any actual or potential violations
disclosed by the Company to the Trust in writing as of the Effective Date (as defined in
the Stock Purchase Agreement) and in the case of (i), (ii) and (iii) above, with respect to
such breaches, defaults, violations or creation or imposition of any liens that would not
individually or in the aggregate have a Material Adverse Effect (as defined in the Stock
Purchase Agreement) or affect the validity of the Securities, nor will such action result
in any violation of the provisions of the Charter or the By-Laws.






	(2)	 	Assuming the accuracy of the Trust’s representations and warranties set out in Section
5.1 and Section 5.2 of the Stock Purchase Agreement and its compliance with its obligations
thereunder, to the best of my knowledge after due investigation, no action, consent or
approval of, registration or filing with or any other action by, any court or




 









 






3




	 	 	governmental body with jurisdiction over the Company is or will be required to be taken,
obtained or made in connection with the Stock Purchase Agreement, except (a) such as have
been made or obtained and are in full force and effect, (b) such as have been disclosed by
the Company to the Trust in writing as of the Effective Date, (c) the filings and
registrations contemplated by Sections 6.2, 6.6, 7.1 and 7.2 of the Stock Purchase Agreement
and (d) if the failure to take such action, obtain such consent or approval or register or
file with such court or governmental body could not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.





     The foregoing opinion is limited to the Federal Laws of the United States, laws of the State
of New York and the General Corporation Law of the State of Delaware, and I am expressing no
opinion as to the effect of the laws of any other jurisdiction.



     I have also relied as to certain matters upon information obtained from public officials,
officers of the Company and other sources believed by me to be responsible, and I have assumed that
the certificates for the Securities conform to the specimen thereof examined by me and have been
duly countersigned by a transfer agent and duly registered by a registrar of the Securities, that
the certificates (if any) for the Underlying Shares will conform to the specimen thereof examined
by me and will be duly countersigned by a transfer agent and duly registered by a registrar of the
Common Stock (and if the Underlying 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 me are genuine, assumptions which I have not independently
verified.



     This opinion is delivered by me, as counsel to the Company, to you, is solely for your benefit
and may not be relied upon, or delivered or disclosed to, any other person without my prior written
consent.



	 	 	 	 	 
	 	Very truly yours,