Document:

AMERICAN INTERNATIONAL GROUP, INC.
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         2005/2006 DEFERRED COMPENSATION PROFIT PARTICIPATION PLAN
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                             (SENIOR PARTNERS)
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1.   PURPOSE AND STRUCTURE

     The   Compensation   Committee   of  the  Board  of   Directors   (the
"Compensation Committee") of American International Group, Inc. ("AIG") has
determined  that  certain  key  employees  of  AIG  and  its   subsidiaries
(together,  the "Employer")  contribute  substantially to the growth of the
value of the assets and income of AIG. AIG has created  this AIG  2005/2006
Deferred Compensation Profit Participation Plan to reward these individuals
(the   "Participants")  and  to  provide  incentives  for  their  continued
contribution to the growth of AIG.

     The AIG 2005/2006 Deferred Compensation Profit Participation Plan (the
"Plan") is composed of three plan  documents,  one for  Participants in the
"Senior Partner"  category,  one for Participants in the "Partner" category
and one for  Participants  in the  "Associate"  category.  These  documents
describe  features that differ among these  categories of Participants  but
together constitute one Plan. This is the Plan document for participants in
the "Senior Partner" category.

2.   PARTICIPATION AND UNITS

     The Compensation Committee, in its sole discretion,  shall establish a
list of the  Participants  in the Plan (from the employees of the Employer)
and express an amount of  participation in the Plan in "units" next to each
name that shall  indicate the level of  participation  of the  Participant.
Categories  of  participation  shall be  divided,  based on the  number  of
allocated units, into Associate, Partner or Senior Partner.

     Participants  granted 1000 or more participation  units under the Plan
are referred to as "Senior Partners".

     All  participation  units under the Plan shall be deemed to be granted
effective  January  1,  2005  (the  "Grant  Date"),  regardless  of when an
individual  becomes  a  Participant.  The term of the Plan  shall  commence
January 1, 2005 and shall continue to December 31, 2006.

3.   INITIAL ALLOCATED AIG STOCK AND EPS THRESHOLD

     AIG shall cause an account to be kept in the name of each  Participant
that shall  reflect the shares of common  stock of AIG, par value $2.50 per
share (the "AIG Stock"), if any, contingently allocated to each Participant
under  the  Plan.  If the  EPS  Growth  Threshold  (as  defined  below)  is
satisfied,  each Senior  Partner  Participant  employed by the  Employer at
December 31, 2006 shall have contingently  allocated to such  Participant's
account 16 shares of AIG Stock for each  participation unit granted to such
Participant (such Participant's "Initial Allocated AIG Stock").

     The "EPS  Growth  Threshold"  shall  be  satisfied  if the  cumulative
earnings  per  share of AIG  Stock  during  the two  year  term of the Plan
exceeds  cumulative  earnings  per share of AIG Stock  during  the two year
period  commencing  January 1, 2003 and ending  December 31, 2004. For this
purpose  earnings  per  share  shall  be  determined  by  the  Compensation
Committee in its sole discretion in accordance with U.S. Generally Accepted
Accounting  Principles (1) without giving effect to realized  capital gains
or losses,  net of tax;  the  cumulative  affect of  changes in  accounting
treatment  during  the  relevant  periods,  net of tax;  FAS 133  gains and
losses,  excluding  realized  capital  gains  or  losses,  net of  tax;  or
extraordinary  items  related to  acquisition,  restructuring  and  related
charges,  net of tax,  (2) with  adjustments  for any stock  split or stock
dividend during the relevant  period,  (3) with  adjustments in the case of
cash  acquisitions  in excess  of $5  billion  to  equalize  the  effect of
acquisitions  for cash and acquisitions for AIG Stock, (4) giving effect to
any  restatement in earnings per share for the relevant period and (5) with
such other  adjustments as the  Compensation  Committee may make to provide
consistency  between  the two year term of the Plan and the two year period
commencing  January 1, 2003 and ending December 31, 2004. For the avoidance
of  doubt,  the  preceding  adjustments  may be  made  by the  Compensation
Committee in its sole discretion.

4.   EARLY PAYOUTS OF INITIAL ALLOCATED AIG STOCK

     Subject to the following  terms and  conditions,  each Senior  Partner
Participant shall receive:

     A.   on May 1, 2009 providing that such Participant is employed by the
          Employer at such time,  ten percent  (10%) of such  Participant's
          Initial  Allocated AIG Stock (less any withholding taxes required
          thereon);

     B.   on May 1, 2010 providing that such Participant is employed by the
          Employer at such time,  ten percent  (10%) of such  Participant's
          Initial  Allocated AIG Stock (less any withholding taxes required
          thereon); and

     C.   on January 1, 2015 providing that such Participant is employed by
          the   Employer  at  such  time,   five   percent   (5%)  of  such
          Participant's  Initial  Allocated AIG Stock (less any withholding
          taxes required thereon).

5.   INCREMENTAL AMOUNT

     The amounts described in this section shall be contingently  allocated
to the account of each Senior Partner  Participant  in accordance  with the
rules  of the  Plan,  regardless  of any  early  payouts  received  by such
Participant under section 4.

     A.   If any Senior  Partner  Participant is employed with the Employer
          at the end of the  eighth  year from the  Grant  Date and has not
          reached age 65 at such time,  an  additional  amount of AIG Stock
          equal  to  twenty  percent  (20%) of such  Participant's  Initial
          Allocated  AIG  Stock  shall be  allocated  to the  Participant's
          account to be  distributed  or  forfeited as provided in the Plan
          (such Participant's  "Incremental Amount" and, together with such
          Participant's  Initial  Allocated AIG Stock,  such  Participant's
          "Allocated AIG Stock").

     B.   Notwithstanding  the  conditions  of  section  5 A,  if a  Senior
          Partner  Participant  is employed with the Employer at age 65 and
          retires  on  or  thereafter;  or  dies,  or  retires  because  of
          permanent disability or illness prior to age 65, such Participant
          shall be entitled in accordance with section 7 to such portion of
          the Incremental Amount contingently  allocated under this section
          as follows:

          (1)  25%  of  such  amount  if  death,  permanent  disability  or
               retirement occurs within 6 months from the Grant Date;

          (2)  50%  of  such  amount  if  death,  permanent  disability  or
               retirement  occurs on or after 6 months but within 12 months
               from the Grant Date;

          (3)  75%  of  such  amount  if  death,  permanent  disability  or
               retirement occurs on or after 12 months but within 18 months
               from the Grant Date; and

          (4)  100%  of such  amount  if  death,  permanent  disability  or
               retirement occurs on or after 18 months from the Grant Date.

     C.   If a Senior Partner Participant retires or is terminated with the
          consent  of  the  Compensation  Committee  prior  to  age  65 and
          satisfies the covenants, agreements and conditions as provided by
          section 6 A, such  Participant may be entitled in accordance with
          section 7 to such portion of the Incremental Amount  contingently
          allocated to the  Participant's  account under this section,  the
          numerator  of which  shall be the  number of years from the Grant
          Date to the  date  of such  retirement  or  termination,  and the
          denominator  of which  shall be eight (8). If the  retirement  or
          termination  with consent of the  Compensation  Committee  occurs
          within  the first 6 months of a  calendar  year no credit for any
          part of the year shall be provided in  calculating  the numerator
          of the fraction.  If such event occurs during the last six months
          of a calendar  year, a full year of service  shall be included in
          the numerator of the fraction.

6.   RETIREMENT OR TERMINATION WITH CONSENT OF COMPENSATION COMMITTEE

     A.   Notwithstanding  the  limitations  provided  in  section 7 A that
          deprive a Participant who retires,  terminates,  is terminated or
          otherwise  departs  prior  to age 65 of any  rights  to the  such
          Participant's  Allocated AIG Stock,  the  Compensation  Committee
          may, in its sole discretion,  reinstate such contingent rights to
          the  Allocated AIG Stock as provided in B (1) through (3) herein,
          if and only if, such  Participant  complies with such  covenants,
          agreements and conditions as the  Compensation  Committee may, in
          its sole discretion, impose from the time of early termination of
          employment to age 65.

     B.   Any  Participant  who  receives  the consent of the  Compensation
          Committee   to   reinstate   the   contingent   rights   to  such
          Participant's  Allocated  AIG Stock under this  section  shall be
          entitled to the following amounts after appropriate determination
          that  the  required  covenants,   agreements  and  conditions  of
          subsection A have been complied with:

          (1)  one  hundred  percent  (100%) of the  Participant's  Initial
               Allocated AIG Stock or, if such retirement occurs before the
               end of the two year term of the Plan,  such  portion  of the
               Participant's  Initial  Allocated  AIG  Stock as  determined
               under section 8;

          (2)  plus such portion of the Incremental  Amount as described in
               section 5 C;

          (3)  less any Allocated AIG Stock  previously  distributed  under
               the provisions of section 4.

7.   GENERAL RULES

     Each Participant's  Allocated AIG Stock (not previously distributed as
an early  payout under  section 4) shall not vest and shall  continue to be
governed by and  contingently  reserved for the  Participant  in accordance
with the Plan's terms and conditions  until such  Participant  fulfills the
employment conditions and retires on or after reaching age 65.

     A.   The Participant will forfeit any and all rights to or interest in
          any undistributed  Allocated AIG Stock contingently  allocated to
          the  Participant's  account in the event his/her  employment with
          the Employer  terminates or is  terminated  for any reason (other
          than death or permanent  disability)  including,  but not limited
          to,  redundancy or dismissal  prior to such retirement at age 65.
          In the event of death or permanent  disability occurring prior to
          age 65 and while an  individual  is a full time employee with the
          Employer,  the Participant or his/her estate, heir or successors,
          as the  case  may  be,  shall  become  entitled  to  receive  any
          Allocated AIG Stock  contingently  allocated to the Participant's
          account  as  provided  hereunder,  at the  time  of  such  event.
          "Permanent  disability"  has the meaning  defined in the American
          International  Group, Inc. Group Long-Term Insurance Policy as in
          effect on January 1, 2005.

     B.   The Participant  will have no rights as a stockholder of AIG, and
          therefore  will not be  entitled  to cash  dividends  paid on the
          Allocated AIG Stock nor to vote such stock until the AIG Stock is
          delivered to such  individual by AIG under the terms described in
          the Plan.  All stock  dividends  or splits  with  respect  to any
          Allocated  AIG Stock  occurring  after  December  31,  2006 shall
          accrue  and  accumulate  as part of the early  payout  amounts or
          contingent  deferred  amounts.  The Compensation  Committee shall
          have  the  authority  (but  shall  not  be  required)  to  adjust
          equitably  the  shares  of AIG  Stock  to be  allocated  for each
          participation  unit  pursuant  to  section  3 and the  shares  of
          Allocated  AIG Stock in such  manner as it deems  appropriate  to
          preserve the benefits or potential  benefits  intended to be made
          available to  Participants  (including,  without  limitation,  by
          payment of cash or by substituting or adding other  securities or
          property)  for any  change  in the  AIG  Stock  resulting  from a
          recapitalization,  stock split,  stock  dividend,  combination or
          exchange of shares of AIG Stock,  merger,  consolidation,  rights
          offering, separation, reorganization or liquidation, or any other
          change in the  corporate  structure  or shares of AIG.  After any
          adjustment made pursuant to this section, the number of shares of
          each  Participant's  Allocated AIG Stock shall be rounded down to
          the nearest whole number.

     C.   Prior to June 30, 2006,  the  Participant  may request to receive
          any remaining  distribution to which he/she is entitled under one
          of the following options as stated hereinafter:

          (1)  In a lump sum in shares of the  Allocated  AIG Stock payable
               at the close of the first  business  day of  January  of the
               year  immediately  subsequent  to the later of,  the year in
               which the Participant either becomes 65 years of age, or the
               year of actual retirement.

          (2)  In  periodic  payments  of pro  rated  amounts  of shares of
               Allocated   AIG  Stock   (adjusted  for   subsequent   stock
               dividends)  over  five (5)  years  or ten (10)  years as the
               Participant may elect,  commencing the first business day of
               January of the year immediately  subsequent to the later of,
               the year in which the  Participant  becomes  65 years of age
               or, the year of actual  retirement.  Such pro rated payments
               shall  be made on each  anniversary  date  after  the  first
               payment.

          If the  Participant  makes no election by June 30,  2006,  he/she
          shall become  entitled to receive a lump sum  distribution of any
          remaining  Allocated AIG Stock to which he/she is entitled on the
          first business day of January in the year  subsequent to the year
          in which retirement occurs.

     D.   If the  Participant  does not retire upon reaching age 65, he/she
          shall only become entitled to receive any remaining Allocated AIG
          Stock to which he/she is entitled,  its dividends or the right to
          vote such  shares,  on the first  business  day of January of the
          year subsequent to his year of actual retirement.

     E.   If the  Participant  elects to defer the receipt of any remaining
          Allocated  AIG Stock to which he/she is entitled  over a five (5)
          or ten (10) year  period  subsequent  to  reaching  age 65 he/she
          shall  covenant  not to  compete  in any  business  in which  any
          Employer engages, and he/she shall make himself/herself available
          from time to time to the Employer for  consulting  services  when
          necessary   and   requested   and  shall  receive  no  additional
          compensation for providing such consulting services.

     F.   Notwithstanding  the foregoing the Compensation  Committee in its
          sole  discretion  reserves  the right of final  determination  of
          whether to distribute to the Participant either the shares of AIG
          Stock or an amount of cash equivalent in value to the fair market
          value of such shares of AIG Stock.

     G.   Notwithstanding  any other provision  existing within the Plan, a
          Participant  must have rendered  service to one or more Employers
          for a period of at least four (4) years before  being  considered
          eligible  for any  distributions  under the Plan,  subject to any
          longer period of service  required by any other  provision of the
          Plan for any payouts under any provision of the Plan.

     H.   The  provisions of the Plan provide no right or  eligibility to a
          Participant  to any other payouts from AIG, its  subsidiaries  or
          affiliates under any other alternative plans schemes arrangements
          or  contracts  AIG may  have  with  any  employees  or  group  of
          employees of AIG, its subsidiaries or affiliates.

     I.   Shares of AIG Stock  delivered  to a  Participant  under the Plan
          shall be  treated  as an "Award"  made  pursuant  to the AIG 2002
          Stock  Incentive  Plan, as amended from time to time (the "SIP"),
          and,  except as modified by this Plan, all terms of the SIP shall
          apply to this Plan.  Notwithstanding any other provision existing
          within the Plan,  the amount of Allocated AIG Stock  contingently
          allocated to any  Participant's  account shall not exceed any per
          person per period award limit under the SIP.

     J.   Only whole shares of AIG Stock shall be delivered under the Plan.
          Fractional  shares  shall be rounded  down to the  nearest  whole
          share and any such fractional shares shall be forfeited.

     K.   Grants and deliveries  under the Plan shall  constitute a special
          discretionary  incentive payment to the Participant and shall not
          be required to be taken into account in  computing  the amount of
          salary or  compensation  of the  Participant  for the  purpose of
          determining  any  contributions  to or  any  benefits  under  any
          pension,  retirement,   profit-sharing,  bonus,  life  insurance,
          severance  or other  benefit  plan of the  Employer  or under any
          agreement with the Participant,  unless the Employer specifically
          provides otherwise.

     L.   Notwithstanding any provision to the contrary in the Plan, to the
          extent any distribution to be made to a Participant in connection
          with the  Participant's  termination of service with the Employer
          would be subject  to the  additional  tax of Section  409A of the
          Internal Revenue Code, the distribution will be delayed until six
          (6) months after a Participant's  termination of service with the
          Employer (or earlier death or  disability  (within the meaning of
          Section 409A)).

8.   DEATH, DISABILITY OR RETIREMENT IN THE FIRST TWO YEARS OF PLAN

     If a Participant  dies, is permanently  disabled,  or retires with the
consent of the  Compensation  Committee as provided in section 6 during the
two  year  term  of the  Plan  (except  that  retirement  at or  after  the
Participant  turns  age 65 does not need the  consent  of the  Compensation
Committee):

     A.   within the first six months after the Grant Date, the Participant
          will receive  upon  determination  one fourth of the  appropriate
          Initial Allocated AIG Stock;

     B.   on or after six months but within one year of the Grant Date, the
          Participant  will  receive  upon  determination  one  half of the
          appropriate Initial Allocated AIG Stock;

     C.   on or after twelve months but within eighteen months of the Grant
          Date,  the  Participant  will  receive upon  determination  three
          fourths of the appropriate Initial Allocated AIG Stock;

     D.   on or after eighteen  months from the Grant Date, the Participant
          will receive upon determination one hundred percent (100%) of the
          appropriate Initial Allocated AIG Stock;

in each case which would have been  allocated  to his or her account at the
end of the  second  year  of  the  Plan  and in  each  case  excluding  the
Incremental  Amount  (which  portion  available for  distribution  shall be
determined under section 5 B or C).

     Generally  distribution  of  Allocated  AIG Stock shall occur within a
reasonable period after December 31, 2006 when the determination is made as
to whether the EPS Growth Threshold has been satisfied.

9.   NON-ASSIGNABLE

     Any rights or  expectancy  thereof  which a  Participant  may  receive
pursuant to the Plan shall not be assignable, transferable, pledged, hedged
or in any manner  alienated,  whether  by  operation  of law or  otherwise,
except as a result of death or  incapacity  where  such  rights  are passed
pursuant to a will or by operation of law. The  Compensation  Committee may
in its sole discretion  acknowledge the written  direction by a Participant
to transfer his/her contingent rights under the Plan to a revocable grantor
trust in such form and on such  conditions  as such  officer may require in
his or her sole  discretion.  Any assignment,  transfer,  pledge,  or other
disposition  in violation of the provisions of this section 9 shall be null
and void and any  Allocated  AIG Stock which is hedged in any manner  shall
immediately be forfeited.

10.  ADMINISTRATION OF THE PLAN

     The Plan shall be administered by the Compensation Committee.  Actions
of the Committee may be taken by the vote of a majority of its members. The
Committee may allocate  among its members and delegate to any person who is
not a member of the Committee any of its administrative responsibilities.

     The Compensation  Committee shall have power to interpret the Plan, to
make  regulations  for  carrying  out its  purpose  and to make  all  other
determinations in connection with its  administration,  all of which shall,
unless  otherwise  determined  by the  Compensation  Committee,  be  final,
binding and conclusive.  The Compensation Committee shall have the power to
amend the Plan in any manner and at any time, including in a manner adverse
to the rights of the Participants.  In addition, the Compensation Committee
shall  have  the  power to  increase  a  Participant's  amount  of  Initial
Allocated AIG Stock.

     No  member  of the  Board  of  Directors  of  AIG or the  Compensation
Committee  or any  employee  of the  Company  (each such  person a "Covered
Person") shall have any liability to any person (including any Participant)
for any action  taken or omitted to be taken or any  determination  made in
good faith with respect to the Plan or any  Participant's  participation in
it. Each  Covered  Person  shall be  indemnified  and held  harmless by AIG
against  and  from  any  loss,  cost,  liability,   or  expense  (including
attorneys'  fees)  that may be imposed  upon or  incurred  by such  Covered
Person in connection with or resulting from any action,  suit or proceeding
to which such Covered Person may be a party or in which such Covered Person
may be involved by reason of any action  taken or omitted to be taken under
the Plan and  against  and from any and all  amounts  paid by such  Covered
Person, with AIG's approval, in settlement thereof, or paid by such Covered
Person  in  satisfaction  of any  judgment  in any  such  action,  suit  or
proceeding  against such Covered  Person,  provided that AIG shall have the
right,  at its own expense,  to assume and defend any such action,  suit or
proceeding  and, once AIG gives notice of its intent to assume the defense,
AIG shall have sole control over such defense with counsel of AIG's choice.
The  foregoing  right  indemnification  shall not be available to a Covered
Person to the  extent  that a court of  competent  jurisdiction  in a final
judgment  or other  final  adjudication,  in either  case,  not  subject to
further  appeal,  determines  that the acts or  omissions  of such  Covered
Person giving rise to the indemnification  claim resulted from such Covered
Person's bad faith,  fraud or willful  misconduct.  The foregoing  right of
indemnification   shall  not  be   exclusive   of  any   other   rights  of
indemnification  to which  Covered  Persons  may be  entitled  under  AIG's
Restated  Certificate of  Incorporation  or Bylaws,  as a matter of law, or
otherwise,  or any other power that AIG may have to indemnify  such persons
or hold them harmless.

     If the  Compensation  Committee  shall at any time  determine that any
consent (as  hereinafter  defined) is necessary or desirable as a condition
of, or in connection with, the granting of any units, contingent allocation
of any  Allocated  AIG Stock,  the  delivery  of shares of AIG Stock or the
delivery of any cash,  securities or other  property under the Plan, or the
taking of any other action  thereunder (each such action, a "plan action"),
then such plan action shall not be taken,  in whole or in part,  unless and
until  such  consent  shall  have been  effected  or  obtained  to the full
satisfaction of the Compensation Committee.  The Compensation Committee may
direct that any certificate  evidencing AIG Stock delivered pursuant to the
Plan shall bear a legend setting forth such restrictions on transferability
as the  Compensation  Committee may determine to be necessary or desirable,
and may advise the transfer  agent to place a stop  transfer  order against
any legended shares.  The term "consent" as used in this paragraph includes
(A)  any and all  listings,  registrations  or  qualifications  in  respect
thereof upon any securities exchange or under any federal,  state, or local
law,  or law,  rule or  regulation  of a  jurisdiction  outside  the United
States,  (B) any other matter,  which the  Compensation  Committee may deem
necessary  or  desirable  to  comply  with the  terms of any such  listing,
registration  or   qualification   or  to  obtain  an  exemption  from  the
requirement  that any such listing,  qualification or registration be made,
(C) any and all other  consents,  clearances  and approvals in respect of a
plan  action  by any  governmental  or other  regulatory  body or any stock
exchange or self-regulatory agency and (D) any and all consents required by
the  Compensation  Committee.  Nothing  herein  shall  require AIG to list,
register or qualify the shares of AIG Stock on any securities exchange.

     The Compensation Committee's determinations under the Plan need not be
uniform and may be made by it selectively among persons who receive, or are
eligible to receive,  benefits  under the Plan (whether or not such persons
are similarly situated).  Without limiting the generality of the foregoing,
the Compensation  Committee shall be entitled,  among other things, to make
non-uniform  and selective  determinations  as to (1) the persons to become
Participants  and (2) whether a Participants  employment  with Employer has
been terminated (as described in section 11).

11.  DETERMINATION OF EMPLOYMENT

     Nothing contained in the Plan or in any participation granted pursuant
to the Plan shall  confer on any  Participant  any right to be continued in
the employ of the  Employer  or to be  included  in any  future  plans of a
similar nature.

     The  Compensation  Committee shall have the right to determine  itself
with respect to any Participant the  commencement  date or termination date
of such  Participant's  employment with the Employer solely for purposes of
the Plan,  separate and apart from any such determination as may be made by
AIG,  its  subsidiaries  or  affiliates  with  respect to the  individual's
employment.

12.  GOVERNING LAW; WAIVER OF SUIT; CONFIDENTIALITY

     Any  dispute,  controversy  or claim  between  AIG and a  Participant,
arising  out of or relating to or  concerning  the Plan or any  allocation,
shall be finally  settled by  arbitration  in New York City before,  and in
accordance  with the rules then obtaining of, the New York Stock  Exchange,
Inc.  (the "NYSE") or, if the NYSE  declines to arbitrate the matter (or if
the matter  otherwise is not  arbitrable  by it), the American  Arbitration
Association (the "AAA") in accordance with the commercial arbitration rules
of the AAA. Prior to  arbitration,  all claims  maintained by a Participant
must first be submitted to the  Compensation  Committee in accordance  with
claims procedures determined by the Compensation Committee.  This Paragraph
is subject to the other provisions of section 12 below.

     AIG and each Participant  hereby  irrevocably  submit to the exclusive
jurisdiction  of a state  or  federal  court  of  appropriate  jurisdiction
located in the  Borough of  Manhattan,  the City of New York over any suit,
action or proceeding  arising out of or relating to or concerning  the Plan
or any allocation that is not otherwise arbitrated or resolved according to
the foregoing  paragraph.  AIG and each  Participant  acknowledge  that the
forum designated by this section has a reasonable  relation to the Plan and
to such Participant's relationship with AIG.

     AIG and each  Participant  waive,  to the fullest extent  permitted by
applicable  law,  any  objection  which  AIG and  such  Participant  now or
hereafter  may have to personal  jurisdiction  or to the laying of venue of
any such  suit,  action  or  proceeding  in any court  referred  to in this
section.  AIG and each  Participant  undertake  not to commence any action,
suit or proceeding  arising out of or relating to or concerning the Plan or
any allocation in any forum other than a forum described in this section.

     Each Participant  irrevocably appoints the Secretary of AIG at 70 Pine
Street, New York, New York 10270, U.S.A. as his or her agent for service of
process in connection with any action, suit or proceeding arising out of or
relating to or concerning the Plan or any allocation  that is not otherwise
arbitrated or resolved according to the first paragraph of this section 12.
The Secretary  shall promptly advise the Participant of any such service of
process.

     Each Participant recognizes and agrees that prior to being selected by
the Compensation  Committee to receive an allocation he/she has no right to
any  benefits  under  the  Plan.  Accordingly,  in  consideration  of  each
Participant's  receipt of an allocation,  he/she expressly waives any right
to contest the amount of such allocation, the terms of such allocation, any
determination,  action or omission made by the Compensation Committee,  AIG
or the board of directors of AIG, or any amendment to the Plan.

     Each Participant must keep confidential any information concerning any
allocation  made  under  the Plan  and any  dispute,  controversy  or claim
relating to the Plan,  except that a Participant  may disclose  information
concerning a dispute or claim to the court that is considering such dispute
or to such  Participant's  legal counsel (provided that such counsel agrees
not to  disclose  any  such  information  other  than as  necessary  to the
prosecution or defense of the dispute).

<PAGE>

                                                 [Form for Senior Partners]

                                                 [DATE], 2005

PRIVATE & CONFIDENTIAL
----------------------

[NAME]
[ADDRESS]
[ADDRESS]

     Re:  AIG 2005-2006 Deferred Compensation
          Profit Participation Plan
          -----------------------------------

Dear [NAME]:

          I am pleased to advise you that AIG has formally adopted its
2005-2006 Deferred Compensation Profit Participation Plan. As previously
communicated, you have been selected to participate in this plan and have
been awarded [_____] units under the plan. This places you in the "Senior
Partner" category of the 2005-2006 Plan. A copy of the Plan is attached.

          If the cumulative earnings per share of AIG common stock (as
calculated in accordance with the 2005-2006 Plan) for 2005 and 2006 exceed
cumulative earnings per share for 2003 and 2004, you will be contingently
allocated 16 shares of AIG common stock for each unit granted to you under
the plan. Furthermore, as a "Senior Partner" participant, if you continue
to be employed by AIG on January 1, 2013 and have not reached age 65, you
will receive a 20% increase (or "reload") in the number of AIG shares
contingently allocated to you. At the time any shares are contingently
allocated to you, you will be awarded a restricted stock unit under the AIG
2002 Stock Incentive Plan reflecting the terms of the 2005-2006 Plan. (You
will need to execute an award agreement at that time to reflect your
acceptance of the terms of the award.)

          Generally, your award will be payable as follows: 10% on May 1,
2009, 10% on May 1, 2010, 5% on January 1, 2015 and the remainder upon
retirement after reaching age 65. The shares contingently allocated to you
under the plan will vest when you reach age 65 or have at least 4 years
total service with AIG, whichever is later, except that shares that are
paid early will vest when they are paid. In general, if you cease
employment with AIG for any reason, you will forfeit any unvested shares.
However, the Compensation Committee retains the right to vest AIG shares in
its discretion. The Compensation Committee also retains the right to
determine whether your award will be paid in shares of AIG common stock or
in cash.

          The complete terms of your award are set forth in the 2005-2006
Plan. Of course, if there are any inconsistencies between the summary in
this letter and the Plan, the Plan will control.

          The 2005-2006 Plan is part of AIG's plan to continue to reward
and motivate its key employees, including yourself. AIG senior management
and the Board of Directors appreciate that this has been a difficult time
for all AIG employees. I personally wish to thank each of you for your
dedication and hard work during this period. It is among my highest
priorities as your new CEO to recognize the contributions you have made and
continue to make as part of our common efforts to ensure the future success
of AIG.

                                            Sincerely,

                                            Martin J. SullivanAMERICAN INTERNATIONAL GROUP, INC.
                     ----------------------------------

         2005/2006 DEFERRED COMPENSATION PROFIT PARTICIPATION PLAN
         ---------------------------------------------------------

                                 (PARTNERS)
                                 ----------

1.   PURPOSE AND STRUCTURE

     The   Compensation   Committee   of  the  Board  of   Directors   (the
"Compensation Committee") of American International Group, Inc. ("AIG") has
determined  that  certain  key  employees  of  AIG  and  its   subsidiaries
(together,  the "Employer")  contribute  substantially to the growth of the
value of the assets and income of AIG. AIG has created  this AIG  2005/2006
Deferred Compensation Profit Participation Plan to reward these individuals
(the   "Participants")  and  to  provide  incentives  for  their  continued
contribution to the growth of AIG.

     The AIG 2005/2006 Deferred Compensation Profit Participation Plan (the
"Plan") is composed of three plan  documents,  one for  Participants in the
"Senior Partner"  category,  one for Participants in the "Partner" category
and one for  Participants  in the  "Associate"  category.  These  documents
describe  features that differ among these  categories of Participants  but
together constitute one Plan. This is the Plan document for participants in
the "Partner" category.

2.   PARTICIPATION AND UNITS

     The Compensation Committee, in its sole discretion,  shall establish a
list of the  Participants  in the Plan (from the employees of the Employer)
and express an amount of  participation in the Plan in "units" next to each
name that shall  indicate the level of  participation  of the  Participant.
Categories  of  participation  shall be  divided,  based on the  number  of
allocated units, into Associate, Partner or Senior Partner.

     Participants  granted more than 599 participation units under the Plan
but less than 1000  participation  units under the Plan are  referred to as
"Partners".

     All  participation  units under the Plan shall be deemed to be granted
effective  January  1,  2005  (the  "Grant  Date"),  regardless  of when an
individual  becomes  a  Participant.  The term of the Plan  shall  commence
January 1, 2005 and shall continue to December 31, 2006.

3.   INITIAL ALLOCATED AIG STOCK AND EPS THRESHOLD

     AIG shall cause an account to be kept in the name of each  Participant
that shall  reflect the shares of common  stock of AIG, par value $2.50 per
share (the "AIG Stock"), if any, contingently allocated to each Participant
under  the  Plan.  If the  EPS  Growth  Threshold  (as  defined  below)  is
satisfied,  each Partner  Participant  employed by the Employer at December
31, 2006 shall have contingently allocated to such Participant's account 12
shares of AIG Stock for each participation unit granted to such Participant
(such Participant's "Initial Allocated AIG Stock").

     The "EPS  Growth  Threshold"  shall  be  satisfied  if the  cumulative
earnings  per  share of AIG  Stock  during  the two  year  term of the Plan
exceeds  cumulative  earnings  per share of AIG Stock  during  the two year
period  commencing  January 1, 2003 and ending  December 31, 2004. For this
purpose  earnings  per  share  shall  be  determined  by  the  Compensation
Committee in its sole discretion in accordance with U.S. Generally Accepted
Accounting  Principles (1) without giving effect to realized  capital gains
or losses,  net of tax;  the  cumulative  affect of  changes in  accounting
treatment  during  the  relevant  periods,  net of tax;  FAS 133  gains and
losses,  excluding  realized  capital  gains  or  losses,  net of  tax;  or
extraordinary  items  related to  acquisition,  restructuring  and  related
charges,  net of tax,  (2) with  adjustments  for any stock  split or stock
dividend during the relevant  period,  (3) with  adjustments in the case of
cash  acquisitions  in excess  of $5  billion  to  equalize  the  effect of
acquisitions  for cash and acquisitions for AIG Stock, (4) giving effect to
any  restatement in earnings per share for the relevant period and (5) with
such other  adjustments as the  Compensation  Committee may make to provide
consistency  between  the two year term of the Plan and the two year period
commencing  January 1, 2003 and ending December 31, 2004. For the avoidance
of  doubt,  the  preceding  adjustments  may be  made  by the  Compensation
Committee in its sole discretion.

4.   EARLY PAYOUTS OF INITIAL ALLOCATED AIG STOCK

     Subject  to  the  following   terms  and   conditions,   each  Partner
Participant shall receive:

     A.   on May 1, 2009 providing that such Participant is employed by the
          Employer at such time,  seventeen  and a half percent  (17.5%) of
          such   Participant's   Initial  Allocated  AIG  Stock  (less  any
          withholding taxes required thereon);

     B.   on May 1, 2010 providing that such Participant is employed by the
          Employer at such time,  seventeen  and a half percent  (17.5%) of
          such   Participant's   Initial  Allocated  AIG  Stock  (less  any
          withholding taxes required thereon); and

     C.   on January 1, 2015 providing that such Participant is employed by
          the   Employer  at  such  time,   ten   percent   (10%)  of  such
          Participant's  Initial  Allocated AIG Stock (less any withholding
          taxes required thereon).

5.   INCREMENTAL AMOUNT

     The amounts described in this section shall be contingently  allocated
to the account of each Partner  Participant in accordance with the rules of
the Plan,  regardless  of any early  payouts  received by such  Participant
under section 4.

     A.   If any Partner  Participant  is employed with the Employer at the
          end of the eighth  year from the Grant  Date and has not  reached
          age 65 at such time, an  additional  amount of AIG Stock equal to
          thirty-five percent (35%) of such Participant's Initial Allocated
          AIG Stock shall be allocated to the  Participant's  account to be
          distributed   or   forfeited   as  provided  in  the  Plan  (such
          Participant's   "Incremental  Amount"  and,  together  with  such
          Participant's  Initial  Allocated AIG Stock,  such  Participant's
          "Allocated AIG Stock").

     B.   Notwithstanding  the  conditions  of  section  5 A, if a  Partner
          Participant  is employed  with the Employer at age 65 and retires
          on or  thereafter;  or dies,  or  retires  because  of  permanent
          disability or illness prior to age 65, such Participant  shall be
          entitled  in  accordance  with  section 7 to such  portion of the
          Incremental Amount  contingently  allocated under this section as
          follows:

          (1)  25%  of  such  amount  if  death,  permanent  disability  or
               retirement occurs within 6 months from the Grant Date;

          (2)  50%  of  such  amount  if  death,  permanent  disability  or
               retirement  occurs on or after 6 months but within 12 months
               from the Grant Date;

          (3)  75%  of  such  amount  if  death,  permanent  disability  or
               retirement occurs on or after 12 months but within 18 months
               from the Grant Date; and

          (4)  100%  of such  amount  if  death,  permanent  disability  or
               retirement occurs on or after 18 months from the Grant Date.

     C.   If a  Partner  Participant  retires  or is  terminated  with  the
          consent  of  the  Compensation  Committee  prior  to  age  65 and
          satisfies the covenants, agreements and conditions as provided by
          section 6 A, such  Participant may be entitled in accordance with
          section 7 to such portion of the Incremental Amount  contingently
          allocated to the  Participant's  account under this section,  the
          numerator  of which  shall be the  number of years from the Grant
          Date to the  date  of such  retirement  or  termination,  and the
          denominator  of which  shall be eight (8). If the  retirement  or
          termination  with consent of the  Compensation  Committee  occurs
          within  the first 6 months of a  calendar  year no credit for any
          part of the year shall be provided in  calculating  the numerator
          of the fraction.  If such event occurs during the last six months
          of a calendar  year, a full year of service  shall be included in
          the numerator of the fraction.

6.   RETIREMENT OR TERMINATION WITH CONSENT OF COMPENSATION COMMITTEE

     A.   Notwithstanding  the  limitations  provided  in  section 7 A that
          deprive a Participant who retires,  terminates,  is terminated or
          otherwise  departs  prior  to age 65 of any  rights  to the  such
          Participant's  Allocated AIG Stock,  the  Compensation  Committee
          may, in its sole discretion,  reinstate such contingent rights to
          the  Allocated AIG Stock as provided in B (1) through (3) herein,
          if and only if, such  Participant  complies with such  covenants,
          agreements and conditions as the  Compensation  Committee may, in
          its sole discretion, impose from the time of early termination of
          employment to age 65.

     B.   Any  Participant  who  receives  the consent of the  Compensation
          Committee   to   reinstate   the   contingent   rights   to  such
          Participant's  Allocated  AIG Stock under this  section  shall be
          entitled to the following amounts after appropriate determination
          that  the  required  covenants,   agreements  and  conditions  of
          subsection A have been complied with:

          (1)  one  hundred  percent  (100%) of the  Participant's  Initial
               Allocated AIG Stock or, if such retirement occurs before the
               end of the two year term of the Plan,  such  portion  of the
               Participant's  Initial  Allocated  AIG  Stock as  determined
               under section 8;

          (2)  plus such portion of the Incremental  Amount as described in
               section 5 C;

          (3)  less any Allocated AIG Stock  previously  distributed  under
               the provisions of section 4.

7.   GENERAL RULES

     Each Participant's  Allocated AIG Stock (not previously distributed as
an early  payout under  section 4) shall not vest and shall  continue to be
governed by and  contingently  reserved for the  Participant  in accordance
with the Plan's terms and conditions  until such  Participant  fulfills the
employment conditions and retires on or after reaching age 65.

     A.   The Participant will forfeit any and all rights to or interest in
          any undistributed  Allocated AIG Stock contingently  allocated to
          the  Participant's  account in the event his/her  employment with
          the Employer  terminates or is  terminated  for any reason (other
          than death or permanent  disability)  including,  but not limited
          to,  redundancy or dismissal  prior to such retirement at age 65.
          In the event of death or permanent  disability occurring prior to
          age 65 and while an  individual  is a full time employee with the
          Employer,  the Participant or his/her estate, heir or successors,
          as the  case  may  be,  shall  become  entitled  to  receive  any
          Allocated AIG Stock  contingently  allocated to the Participant's
          account  as  provided  hereunder,  at the  time  of  such  event.
          "Permanent  disability"  has the meaning  defined in the American
          International  Group, Inc. Group Long-Term Insurance Policy as in
          effect on January 1, 2005.

     B.   The Participant  will have no rights as a stockholder of AIG, and
          therefore  will not be  entitled  to cash  dividends  paid on the
          Allocated AIG Stock nor to vote such stock until the AIG Stock is
          delivered to such  individual by AIG under the terms described in
          the Plan.  All stock  dividends  or splits  with  respect  to any
          Allocated  AIG Stock  occurring  after  December  31,  2006 shall
          accrue  and  accumulate  as part of the early  payout  amounts or
          contingent  deferred  amounts.  The Compensation  Committee shall
          have  the  authority  (but  shall  not  be  required)  to  adjust
          equitably  the  shares  of AIG  Stock  to be  allocated  for each
          participation  unit  pursuant  to  section  3 and the  shares  of
          Allocated  AIG Stock in such  manner as it deems  appropriate  to
          preserve the benefits or potential  benefits  intended to be made
          available to  Participants  (including,  without  limitation,  by
          payment of cash or by substituting or adding other  securities or
          property)  for any  change  in the  AIG  Stock  resulting  from a
          recapitalization,  stock split,  stock  dividend,  combination or
          exchange of shares of AIG Stock,  merger,  consolidation,  rights
          offering, separation, reorganization or liquidation, or any other
          change in the  corporate  structure  or shares of AIG.  After any
          adjustment made pursuant to this section, the number of shares of
          each  Participant's  Allocated AIG Stock shall be rounded down to
          the nearest whole number.

     C.   Prior to June 30, 2006,  the  Participant  may request to receive
          any remaining  distribution to which he/she is entitled under one
          of the following options as stated hereinafter:

          (1)  In a lump sum in shares of the  Allocated  AIG Stock payable
               at the close of the first  business  day of  January  of the
               year  immediately  subsequent  to the later of,  the year in
               which the Participant either becomes 65 years of age, or the
               year of actual retirement.

          (2)  In  periodic  payments  of pro  rated  amounts  of shares of
               Allocated   AIG  Stock   (adjusted  for   subsequent   stock
               dividends)  over  five (5)  years  or ten (10)  years as the
               Participant may elect,  commencing the first business day of
               January of the year immediately  subsequent to the later of,
               the year in which the  Participant  becomes  65 years of age
               or, the year of actual  retirement.  Such pro rated payments
               shall  be made on each  anniversary  date  after  the  first
               payment.

               If the  Participant  makes no  election  by June  30,  2006,
               he/she  shall   become   entitled  to  receive  a  lump  sum
               distribution  of any remaining  Allocated AIG Stock to which
               he/she is entitled on the first  business  day of January in
               the year subsequent to the year in which retirement occurs.

     D.   If the  Participant  does not retire upon reaching age 65, he/she
          shall only become entitled to receive any remaining Allocated AIG
          Stock to which he/she is entitled,  its dividends or the right to
          vote such  shares,  on the first  business  day of January of the
          year subsequent to his year of actual retirement.

     E.   If the  Participant  elects to defer the receipt of any remaining
          Allocated  AIG Stock to which he/she is entitled  over a five (5)
          or ten (10) year  period  subsequent  to  reaching  age 65 he/she
          shall  covenant  not to  compete  in any  business  in which  any
          Employer engages, and he/she shall make himself/herself available
          from time to time to the Employer for  consulting  services  when
          necessary   and   requested   and  shall  receive  no  additional
          compensation for providing such consulting services.

     F.   Notwithstanding  the foregoing the Compensation  Committee in its
          sole  discretion  reserves  the right of final  determination  of
          whether to distribute to the Participant either the shares of AIG
          Stock or an amount of cash equivalent in value to the fair market
          value of such shares of AIG Stock.

     G.   Notwithstanding  any other provision  existing within the Plan, a
          Participant  must have rendered  service to one or more Employers
          for a period of at least four (4) years before  being  considered
          eligible  for any  distributions  under the Plan,  subject to any
          longer period of service  required by any other  provision of the
          Plan for any payouts under any provision of the Plan.

     H.   The  provisions of the Plan provide no right or  eligibility to a
          Participant  to any other payouts from AIG, its  subsidiaries  or
          affiliates under any other alternative plans schemes arrangements
          or  contracts  AIG may  have  with  any  employees  or  group  of
          employees of AIG, its subsidiaries or affiliates.

     I.   Shares of AIG Stock  delivered  to a  Participant  under the Plan
          shall be  treated  as an "Award"  made  pursuant  to the AIG 2002
          Stock  Incentive  Plan, as amended from time to time (the "SIP"),
          and,  except as modified by this Plan, all terms of the SIP shall
          apply to this Plan.  Notwithstanding any other provision existing
          within the Plan,  the amount of Allocated AIG Stock  contingently
          allocated to any  Participant's  account shall not exceed any per
          person per period award limit under the SIP.

     J.   Only whole shares of AIG Stock shall be delivered under the Plan.
          Fractional  shares  shall be rounded  down to the  nearest  whole
          share and any such fractional shares shall be forfeited.

     K.   Grants and deliveries  under the Plan shall  constitute a special
          discretionary  incentive payment to the Participant and shall not
          be required to be taken into account in  computing  the amount of
          salary or  compensation  of the  Participant  for the  purpose of
          determining  any  contributions  to or  any  benefits  under  any
          pension,  retirement,   profit-sharing,  bonus,  life  insurance,
          severance  or other  benefit  plan of the  Employer  or under any
          agreement with the Participant,  unless the Employer specifically
          provides otherwise.

     L.   Notwithstanding any provision to the contrary in the Plan, to the
          extent any distribution to be made to a Participant in connection
          with the  Participant's  termination of service with the Employer
          would be subject  to the  additional  tax of Section  409A of the
          Internal Revenue Code, the distribution will be delayed until six
          (6) months after a Participant's  termination of service with the
          Employer (or earlier death or  disability  (within the meaning of
          Section 409A)).

8.   DEATH, DISABILITY OR RETIREMENT IN THE FIRST TWO YEARS OF PLAN

     If a Participant  dies, is permanently  disabled,  or retires with the
consent of the  Compensation  Committee as provided in section 6 during the
two  year  term  of the  Plan  (except  that  retirement  at or  after  the
Participant  turns  age 65 does not need the  consent  of the  Compensation
Committee):

     A.   within the first six months after the Grant Date, the Participant
          will receive  upon  determination  one fourth of the  appropriate
          Initial Allocated AIG Stock;

     B.   on or after six months but within one year of the Grant Date, the
          Participant  will  receive  upon  determination  one  half of the
          appropriate Initial Allocated AIG Stock;

     C.   on or after twelve months but within eighteen months of the Grant
          Date,  the  Participant  will  receive upon  determination  three
          fourths of the appropriate Initial Allocated AIG Stock;

     D.   on or after eighteen  months from the Grant Date, the Participant
          will receive upon determination one hundred percent (100%) of the
          appropriate Initial Allocated AIG Stock;

in each case which would have been  allocated  to his or her account at the
end of the  second  year  of  the  Plan  and in  each  case  excluding  the
Incremental  Amount  (which  portion  available for  distribution  shall be
determined under section 5 B or C).

     Generally  distribution  of  Allocated  AIG Stock shall occur within a
reasonable period after December 31, 2006 when the determination is made as
to whether the EPS Growth Threshold has been satisfied.

9.   NON-ASSIGNABLE

     Any rights or  expectancy  thereof  which a  Participant  may  receive
pursuant to the Plan shall not be assignable, transferable, pledged, hedged
or in any manner  alienated,  whether  by  operation  of law or  otherwise,
except as a result of death or  incapacity  where  such  rights  are passed
pursuant to a will or by operation of law. The  Compensation  Committee may
in its sole discretion  acknowledge the written  direction by a Participant
to transfer his/her contingent rights under the Plan to a revocable grantor
trust in such form and on such  conditions  as such  officer may require in
his or her sole  discretion.  Any assignment,  transfer,  pledge,  or other
disposition  in violation of the provisions of this section 9 shall be null
and void and any  Allocated  AIG Stock which is hedged in any manner  shall
immediately be forfeited.

10.  ADMINISTRATION OF THE PLAN

     The Plan shall be administered by the Compensation Committee.  Actions
of the Committee may be taken by the vote of a majority of its members. The
Committee may allocate  among its members and delegate to any person who is
not a member of the Committee any of its administrative responsibilities.

     The Compensation  Committee shall have power to interpret the Plan, to
make  regulations  for  carrying  out its  purpose  and to make  all  other
determinations in connection with its  administration,  all of which shall,
unless  otherwise  determined  by the  Compensation  Committee,  be  final,
binding and conclusive.  The Compensation Committee shall have the power to
amend the Plan in any manner and at any time, including in a manner adverse
to the rights of the Participants.  In addition, the Compensation Committee
shall  have  the  power to  increase  a  Participant's  amount  of  Initial
Allocated AIG Stock.

     No  member  of the  Board  of  Directors  of  AIG or the  Compensation
Committee  or any  employee  of the  Company  (each such  person a "Covered
Person") shall have any liability to any person (including any Participant)
for any action  taken or omitted to be taken or any  determination  made in
good faith with respect to the Plan or any  Participant's  participation in
it. Each  Covered  Person  shall be  indemnified  and held  harmless by AIG
against  and  from  any  loss,  cost,  liability,   or  expense  (including
attorneys'  fees)  that may be imposed  upon or  incurred  by such  Covered
Person in connection with or resulting from any action,  suit or proceeding
to which such Covered Person may be a party or in which such Covered Person
may be involved by reason of any action  taken or omitted to be taken under
the Plan and  against  and from any and all  amounts  paid by such  Covered
Person, with AIG's approval, in settlement thereof, or paid by such Covered
Person  in  satisfaction  of any  judgment  in any  such  action,  suit  or
proceeding  against such Covered  Person,  provided that AIG shall have the
right,  at its own expense,  to assume and defend any such action,  suit or
proceeding  and, once AIG gives notice of its intent to assume the defense,
AIG shall have sole control over such defense with counsel of AIG's choice.
The  foregoing  right  indemnification  shall not be available to a Covered
Person to the  extent  that a court of  competent  jurisdiction  in a final
judgment  or other  final  adjudication,  in either  case,  not  subject to
further  appeal,  determines  that the acts or  omissions  of such  Covered
Person giving rise to the indemnification  claim resulted from such Covered
Person's bad faith,  fraud or willful  misconduct.  The foregoing  right of
indemnification   shall  not  be   exclusive   of  any   other   rights  of
indemnification  to which  Covered  Persons  may be  entitled  under  AIG's
Restated  Certificate of  Incorporation  or Bylaws,  as a matter of law, or
otherwise,  or any other power that AIG may have to indemnify  such persons
or hold them harmless.

     If the  Compensation  Committee  shall at any time  determine that any
consent (as  hereinafter  defined) is necessary or desirable as a condition
of, or in connection with, the granting of any units, contingent allocation
of any  Allocated  AIG Stock,  the  delivery  of shares of AIG Stock or the
delivery of any cash,  securities or other  property under the Plan, or the
taking of any other action  thereunder (each such action, a "plan action"),
then such plan action shall not be taken,  in whole or in part,  unless and
until  such  consent  shall  have been  effected  or  obtained  to the full
satisfaction of the Compensation Committee.  The Compensation Committee may
direct that any certificate  evidencing AIG Stock delivered pursuant to the
Plan shall bear a legend setting forth such restrictions on transferability
as the  Compensation  Committee may determine to be necessary or desirable,
and may advise the transfer  agent to place a stop  transfer  order against
any legended shares.  The term "consent" as used in this paragraph includes
(A)  any and all  listings,  registrations  or  qualifications  in  respect
thereof upon any securities exchange or under any federal,  state, or local
law,  or law,  rule or  regulation  of a  jurisdiction  outside  the United
States,  (B) any other matter,  which the  Compensation  Committee may deem
necessary  or  desirable  to  comply  with the  terms of any such  listing,
registration  or   qualification   or  to  obtain  an  exemption  from  the
requirement  that any such listing,  qualification or registration be made,
(C) any and all other  consents,  clearances  and approvals in respect of a
plan  action  by any  governmental  or other  regulatory  body or any stock
exchange or self-regulatory agency and (D) any and all consents required by
the  Compensation  Committee.  Nothing  herein  shall  require AIG to list,
register or qualify the shares of AIG Stock on any securities exchange.

     The Compensation Committee's determinations under the Plan need not be
uniform and may be made by it selectively among persons who receive, or are
eligible to receive,  benefits  under the Plan (whether or not such persons
are similarly situated).  Without limiting the generality of the foregoing,
the Compensation  Committee shall be entitled,  among other things, to make
non-uniform  and selective  determinations  as to (1) the persons to become
Participants  and (2) whether a Participants  employment  with Employer has
been terminated (as described in section 11).

11.  DETERMINATION OF EMPLOYMENT

     Nothing contained in the Plan or in any participation granted pursuant
to the Plan shall  confer on any  Participant  any right to be continued in
the employ of the  Employer  or to be  included  in any  future  plans of a
similar nature.

     The  Compensation  Committee shall have the right to determine  itself
with respect to any Participant the  commencement  date or termination date
of such  Participant's  employment with the Employer solely for purposes of
the Plan,  separate and apart from any such determination as may be made by
AIG,  its  subsidiaries  or  affiliates  with  respect to the  individual's
employment.

12.  GOVERNING LAW; WAIVER OF SUIT; CONFIDENTIALITY

     Any  dispute,  controversy  or claim  between  AIG and a  Participant,
arising  out of or relating to or  concerning  the Plan or any  allocation,
shall be finally  settled by  arbitration  in New York City before,  and in
accordance  with the rules then obtaining of, the New York Stock  Exchange,
Inc.  (the "NYSE") or, if the NYSE  declines to arbitrate the matter (or if
the matter  otherwise is not  arbitrable  by it), the American  Arbitration
Association (the "AAA") in accordance with the commercial arbitration rules
of the AAA. Prior to  arbitration,  all claims  maintained by a Participant
must first be submitted to the  Compensation  Committee in accordance  with
claims procedures determined by the Compensation Committee.  This Paragraph
is subject to the other provisions of section 12 below.

     AIG and each Participant  hereby  irrevocably  submit to the exclusive
jurisdiction  of a state  or  federal  court  of  appropriate  jurisdiction
located in the  Borough of  Manhattan,  the City of New York over any suit,
action or proceeding  arising out of or relating to or concerning  the Plan
or any allocation that is not otherwise arbitrated or resolved according to
the foregoing  paragraph.  AIG and each  Participant  acknowledge  that the
forum designated by this section has a reasonable  relation to the Plan and
to such Participant's relationship with AIG.

     AIG and each  Participant  waive,  to the fullest extent  permitted by
applicable  law,  any  objection  which  AIG and  such  Participant  now or
hereafter  may have to personal  jurisdiction  or to the laying of venue of
any such  suit,  action  or  proceeding  in any court  referred  to in this
section.  AIG and each  Participant  undertake  not to commence any action,
suit or proceeding  arising out of or relating to or concerning the Plan or
any allocation in any forum other than a forum described in this section.

     Each Participant  irrevocably appoints the Secretary of AIG at 70 Pine
Street, New York, New York 10270, U.S.A. as his or her agent for service of
process in connection with any action, suit or proceeding arising out of or
relating to or concerning the Plan or any allocation  that is not otherwise
arbitrated or resolved according to the first paragraph of this section 12.
The Secretary  shall promptly advise the Participant of any such service of
process.

     Each Participant recognizes and agrees that prior to being selected by
the Compensation  Committee to receive an allocation he/she has no right to
any  benefits  under  the  Plan.  Accordingly,  in  consideration  of  each
Participant's  receipt of an allocation,  he/she expressly waives any right
to contest the amount of such allocation, the terms of such allocation, any
determination,  action or omission made by the Compensation Committee,  AIG
or the board of directors of AIG, or any amendment to the Plan.

     Each Participant must keep confidential any information concerning any
allocation  made  under  the Plan  and any  dispute,  controversy  or claim
relating to the Plan,  except that a Participant  may disclose  information
concerning a dispute or claim to the court that is considering such dispute
or to such  Participant's  legal counsel (provided that such counsel agrees
not to  disclose  any  such  information  other  than as  necessary  to the
prosecution or defense of the dispute).

<PAGE>

                                                        [Form for Partners]

                                                        [DATE], 2005

PRIVATE & CONFIDENTIAL
----------------------

[NAME]
[ADDRESS]
[ADDRESS]

     Re:  AIG 2005-2006 Deferred Compensation
          Profit Participation Plan
          -----------------------------------

Dear [NAME]:

          I am pleased to advise you that AIG has formally adopted its
2005-2006 Deferred Compensation Profit Participation Plan. As previously
communicated, you have been selected to participate in this plan and have
been awarded [_____] units under the plan. This places you in the "Partner"
category of the 2005-2006 Plan. A copy of the Plan is attached.

          If the cumulative earnings per share of AIG common stock (as
calculated in accordance with the 2005-2006 Plan) for 2005 and 2006 exceed
cumulative earnings per share for 2003 and 2004, you will be contingently
allocated 12 shares of AIG common stock for each unit granted to you under
the plan. Furthermore, as a "Partner" participant, if you continue to be
employed by AIG on January 1, 2013 and have not reached age 65, you will
receive a 35% increase (or "reload") in the number of AIG shares
contingently allocated to you. At the time any shares are contingently
allocated to you, you will be awarded a restricted stock unit under the AIG
2002 Stock Incentive Plan reflecting the terms of the 2005-2006 Plan. (You
will need to execute an award agreement at that time to reflect your
acceptance of the terms of the award.)

          Generally, your award will be payable as follows: 17.5% on May 1,
2009, 17.5% on May 1, 2010, 10% on January 1, 2015, and the remainder upon
retirement after reaching age 65. The shares contingently allocated to you
under the plan will vest when you reach age 65 or have at least 4 years
total service with AIG, whichever is later, except that shares that are
paid early will vest when they are paid. In general, if you cease
employment with AIG for any reason, you will forfeit any unvested shares.
However, the Compensation Committee retains the right to vest AIG shares in
its discretion. The Compensation Committee also retains the right to
determine whether your award will be paid in shares of AIG common stock or
in cash.

          The complete terms of your award are set forth in the 2005-2006
Plan. Of course, if there are any inconsistencies between the summary in
this letter and the Plan, the Plan will control.

          The 2005-2006 Plan is part of AIG's plan to continue to reward
and motivate its key employees, including yourself. AIG senior management
and the Board of Directors appreciate that this has been a difficult time
for all AIG employees. I personally wish to thank each of you for your
dedication and hard work during this period. It is among my highest
priorities as your new CEO to recognize the contributions you have made and
continue to make as part of our common efforts to ensure the future success
of AIG.

                                            Sincerely,

                                            Martin J. Sullivan

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