Document:

EX-10.60

Exhibit 10(60)

American International Group, Inc.

Partners Plan

(Amended and Restated Effective December 31, 2008)

1. Purpose

     The Compensation and Management Resources Committee of the Board of Directors (the
"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
long-term growth and profitability of AIG. AIG has created this AIG Partners Plan (this “Plan”) to
reward these individuals and to provide incentives for their continued contribution to the
long-term performance of AIG.

2. Performance Periods

     This Plan will operate for successive overlapping two-year periods (each, a “Performance
Period”). The first Performance Period will be from January 1, 2006 through December 31, 2007.
The second Performance Period will be from January 1, 2007 through December 31, 2008. Thereafter,
each Performance Period will be for successive two calendar-year periods until the Plan is
terminated by the Committee.

3. Performance RSUs and Participants

     A. Performance RSUs. Performance-based Restricted Stock Units awarded pursuant to this Plan
(“Performance RSUs”) will provide holders the opportunity to earn shares of Common Stock of AIG
(“Shares”) based on the growth in AIG’s adjusted diluted earnings per share during the Performance
Period to which the Performance RSUs relate.

     B. Participants. The Committee will, from time to time, determine (1) the key employees of
the Employer who will be awarded Performance RSUs under this Plan (the “Participants”), (2) the
number of Performance RSUs awarded to each Participant and (3) the Performance Period to which the
Performance RSUs relate.

     C. Status of Performance RSUs. Performance RSUs awarded pursuant to this plan are issued
under the AIG Amended and Restated 2007 Stock Incentive Plan or any successor plan, as amended from
time to time (the “SIP”). Each Performance RSU constitutes an unfunded and unsecured promise of
AIG to pay (or cause to be paid) one Share at the relevant payment date. Until such payment, a
holder of Performance RSUs will have only the rights of a general unsecured creditor and no rights
as a shareholder of AIG. As set forth in and subject to the relevant Performance RSU Award
Agreement and the SIP, AIG may, at its option, deliver securities or other property in lieu of
Shares otherwise payable under earned Performance RSUs. References in this Plan to Shares include
such securities or other property in lieu thereof.

 

 

4. Performance Targets and Earned RSUs 

     A. Performance Targets. The Committee will, from time to time, determine the “Target”,
"Threshold” and “Maximum” performance targets for each Performance Period, based on Growth in
Adjusted Diluted EPS over the Performance Period.

     B. Earned Performance RSUs. At the end of each Performance Period, the Committee will
determine the number of Performance RSUs earned for the Performance Period. Subject to the
conditions of this Plan and unless determined otherwise by the Committee, the number of Performance
RSUs earned for a Performance Period will be determined as follows:

	 	 	 	 	 
	Growth in Adjusted Diluted EPS for	 	Percentage of
	the Performance Period	 	Performance RSUs Earned
	Performance less than Threshold
	 	 	0	%
	 
	Performance at least Threshold
	 	 	25	%
	 
	Performance at Target
	 	 	100	%
	 
	Performance at or above Maximum
	 	 	150	%

The percentage of Performance RSUs earned for performance between Threshold and Target and between
Target and Maximum will be determined on a straight-line basis.

     C. Definitions.

     (1) “Growth in Adjusted Diluted EPS” means, for any Performance Period, the average of
(i) the percentage increase (or decrease) in Adjusted Diluted EPS for the first year of the
Performance Period over the Adjusted Diluted EPS for the year prior to the beginning of the
Performance Period and (ii) the percentage increase (or decrease) in Adjusted Diluted EPS
for the second year of the Performance Period over the Adjusted Diluted EPS for the first
year of the Performance Period; provided that, if there is a percentage decrease in
Adjusted Diluted EPS for the first year of the Performance Period, then the percentage
increase (or decrease) in the second year will be measured over the year prior to the
beginning of the Performance Period.

     (2) “Adjusted Diluted EPS” means, for any year, the diluted earnings per share of AIG
common stock calculated on a consolidated basis in accordance with U.S. Generally Accepted
Accounting Principles (a) without giving effect to (i) realized capital gains or losses,
net of tax, (ii) the cumulative effect of changes in accounting treatment during the
relevant periods, net of tax, (iii) the cumulative effect of material changes in tax laws
during the relevant periods (such materiality to be determined by the Committee by
reference to the changes’ effect on AIG’s reported actual tax expense), (iv) FAS 133 gains
and losses, excluding realized capital gains or

2

 

losses, net of tax or (v) extraordinary
items related to acquisition, restructuring and related charges, net of tax; (b) with
adjustments for any stock split or stock dividend during the relevant period; (c) 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 common stock; (d) giving effect to any
restatement in earnings per share for the relevant period; (e) giving effect to one-third of catastrophe losses and (f) with such other adjustments
as the Compensation Committee may make. For the avoidance of doubt, the preceding
adjustments may be made by the Compensation Committee in its sole discretion.

5. Vesting and Payout of Earned Performance RSUs

     A. General. Except for Performance RSUs for the 2006-2007 Performance Period, earned
Performance RSUs will vest and be paid in two equal installments promptly after the third and
fourth anniversaries of the first day of the Performance Period to which the Performance RSUs
relate (each, a “Scheduled Vesting Date”), but no later than the end of the calendar year in which
the relevant Scheduled Vesting Date falls. Performance RSUs for the 2006-2007 Performance Period
will vest and be paid in two equal installments promptly after January 1, 2010, and January 1, 2012
(the Scheduled Vesting Dates for these Performance RSUs), but no later than the end of the relevant
calendar year. Except as provided in Sections 5B, 6 and 7A, if a Participant’s employment with the
Employer is terminated for any reason, the Participant’s rights in respect of any Performance RSUs
that would vest on a future Scheduled Vesting Date will be forfeited and terminate.

     B. Death, Disability or Retirement after Age 65. If a Participant dies, becomes subject to
Disability or terminates employment by means of retirement at or after age 65 (“Retires”), in each
case while actively employed by the Employer, any outstanding earned Performance RSUs will vest and
be paid promptly after the date of such event, but no later than 90 days after such event (in the
case of death or Disability) or the end of the calendar year in which such event falls (in the case
of Retirement), as applicable. For this purpose, “Disability” means a period of medically
determined physical or mental impairment that is expected to result in death or last for a period
of not less than 36 months during which a Participant qualifies for income replacement benefits
under the Employer’s long-term disability plan for at least six months, or, if a Participant does
not participate in such a plan, a period of disability during which the Participant is unable to
engage in any substantial gainful activity by reason of any medically determined physical or mental
impairment which can be expected to result in death or can be expected to last for a continuous
period of not less than 36 months.

     C. Delay of Payment. The Committee may, in its sole discretion, determine to defer payment of
Performance RSUs or permit a Participant to elect to defer payment of Performance RSUs, in each
case in a manner that conforms to the requirements of Section 409A(a)(4) of the Internal Revenue
Code (the “Code”).

3

 

6. Vesting During a Performance Period

     A. General. Except as provided in Section 6B, if a Participant’s employment with the Employer
is terminated for any reason during a Performance Period, all of the Participant’s Performance RSUs
relating to the Performance Period will be forfeited and terminate.

     B. Death, Disability or Retirement after Age 65. If a Participant dies, becomes subject to
Disability or Retires, in each case while actively employed by the Employer, the Participant will be eligible to receive a pro-rated amount (based upon the
number of whole or partial months the Participant was employed during the Performance Period
relative to 24) of the Performance RSUs earned for such Performance Period, as set forth in the
relevant Performance RSU Award Agreement, subject to Section 8E.

7. Administration of this Plan

     A. General. This Plan will be administered by the Committee. Actions of the Committee may be
taken by the vote of a majority of its members. To the extent set forth in the SIP, the Committee
may allocate among its members and delegate to any person who is not a member of the Committee any
of its responsibilities. The Committee will have power to interpret this Plan, to make regulations
for carrying out its purpose and to make all other determinations in connection with its
administration (including, without limitation, whether a Participant has become subject to
Disability), all of which will, unless otherwise determined by the Committee, be final, binding and
conclusive. Subject to Section 8N, the Committee will have the power to increase or decrease the
number of a Participant’s Performance RSUs that are earned for a Performance Period. In addition,
the Committee may, in its sole discretion, reinstate any Performance RSUs that would otherwise have
been terminated and forfeited because of a Participant’s termination of employment, if the
Participant complies with any covenants, agreements or conditions that the Committee may impose;
provided, however, that any such reinstated Performance RSUs will not be paid until the relevant
Scheduled Vesting Dates set forth in Section 5A.

     B. Non-Uniform Determinations. The Committee’s determinations under this Plan need not be
uniform and may be made by it selectively among persons who receive, or are eligible to receive,
Performance RSUs under this Plan (whether or not such persons are similarly situated). Without
limiting the generality of the foregoing, the Committee will be entitled, among other things, to
make non-uniform and selective determinations as to the persons to become Participants.

     C. Amendments. The Committee will have the power to amend this Plan in any manner and at any
time, including in a manner adverse to the rights of the Participants; provided that,
notwithstanding the foregoing and Sections 1.3.1(a), 1.3.1(b) and 3.1 of the SIP, the Committee may
not accelerate or postpone the payout of Shares (or securities or other property in lieu of all or
any part thereof) with respect to Performance RSUs to occur at a time other than the time otherwise
provided for in this Plan or in the relevant Performance RSU Award Agreement.

4

 

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

     E. Adjustments. The Committee will have the authority (but will not be required) to adjust
equitably outstanding and/or earned Performance RSUs to preserve the benefits or potential benefits
intended to be made available to Participants for any change in the AIG common stock resulting from
a recapitalization, combination or exchange of shares of AIG common stock, merger, consolidation,
rights offering, separation, reorganization or liquidation, or any other change in the corporate
structure or shares of AIG; provided that no such adjustment shall be made if or to the extent that
it would cause any payment under this Plan to fail to comply with Section 409A. In addition, the
Committee will have the authority (but will not be required) to adjust outstanding Performance RSUs
for current Performance Periods and earned Performance RSUs for previous Performance Periods for
any restatements of AIG’s financial statements. For the avoidance of doubt, the Committee may, in
its sole discretion, decline to adjust the terms of any outstanding Performance RSU if it
determines that such adjustment would violate applicable law or result in adverse tax consequences
to the Participant or to the Employer.

5

 

8. General Rules

     A. SIP. All terms of the SIP shall apply to Performance RSUs. Notwithstanding any other
provision existing within this Plan, the Performance RSUs awarded pursuant to this Plan will not
exceed any per person per period award limit under the SIP.

     B. Only Whole RSUs. Only whole Performance RSUs will be earned by Participants. Fractional
Performance RSUs that would otherwise be earned with respect to a Performance Period will be
rounded down to the nearest whole Performance RSU, and any such fractional Performance RSUs will be
forfeited.

     C. No Rights to Other Payments. The provisions of this Plan provide no right or eligibility
to a Participant to any other payouts from AIG or its subsidiaries under any other alternative
plans, schemes, arrangements or contracts AIG may have with any employees or group of employees of
AIG or its subsidiaries.

     D. No Effect on Benefits. Grants and payments under this Plan will constitute special
discretionary incentive payments to the Participants and will not be required to be taken into
account in computing the amount of salary or compensation of the Participants 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
a Participant, unless the Employer specifically provides otherwise.

     E. Section 409A.

     (1) Performance RSUs are intended to provide payments that are “deferred compensation”
subject to Section 409A, and this Plan is intended to, and will be interpreted,
administered and construed to, comply with Section 409A with respect to the Performance
RSUs. For this purpose, “Section 409A” means Section 409A of the Code, including any
amendments or successor provisions to that section, and any regulations and other
administrative guidance thereunder, in each case as they may be from time to time amended
or interpreted through further administrative guidance. The Committee will have full
authority to give effect to the intent of this Section 8E.

     (2) Without limiting the generality of Section 8E(1), references to the termination of
a Participant’s employment with respect to Performance RSUs will mean the Participant’s
separation from service with the Employer within the meaning of Section 409A.

     (3) Any payment to be made under the Performance RSUs in connection with termination
of a Participant’s employment (and any other payment under this Plan) that would be subject
to the limitations in Section 409A(a)(2)(b) of the Code will be delayed until six months
after termination of the Participant’s employment (or earlier death) in accordance with the
requirements of Section 409A.

6

 

     (4) To the extent necessary to comply with Section 8E(1), any securities or other
property that the Employer may deliver in respect of Performance RSUs will not have the
effect of deferring delivery or payment beyond the date on which such delivery or payment
would occur with respect to the Shares that would otherwise have been deliverable (unless
the Committee elects a later date for this purpose in accordance with Section 5C).

     (5) Each payment under the Performance RSUs will be treated as a separate payment for
purposes of Section 409A.

     F. Severability. If any of the provisions of this Plan is finally held to be invalid, illegal
or unenforceable (whether in whole or in part), such provision will be deemed modified to the
extent, but only to the extent, of such invalidity, illegality or unenforceability and the
remaining provisions will not be affected thereby; provided that if any of such provisions is
finally held to be invalid, illegal, or unenforceable because it exceeds the maximum scope
determined to be acceptable to permit such provision to be enforceable, such provision will be
deemed to be modified to the minimum extent necessary to modify such scope in order to make such
provision enforceable hereunder.

     G. Entire Agreement. This Plan contains the entire agreement of the parties with respect to
the subject matter thereof and supersedes all prior agreements, promises, covenants, arrangements,
communications, representations and warranties between them, whether written or oral, with respect
to the subject matter thereof.

     H. Waiver of Claims. Each Participant recognizes and agrees that prior to being selected by
the Committee to receive an award of Performance RSU he or she has no right to any benefits under
this Plan. Accordingly, in consideration of the Participant’s receipt of any Performance RSUs
hereunder, he or she expressly waives any right to contest the amount of any Performance RSUs, the
terms of this Plan, any determination, action or omission hereunder by the Committee or AIG or any
amendment to this Plan.

     I. No Third Party Beneficiaries. Except as expressly provided therein, this Plan will not
confer on any person other than AIG and the Participant any rights or remedies thereunder. The
exculpation and indemnification provisions of Section 7D will inure to the benefit of a Covered
Person’s estate and beneficiaries and legatees.

     J. AIG’s Successors and Assigns. The terms of this Plan will be binding upon and inure to the
benefit of AIG and its successors and assigns.

     K. Nonassignability. The Performance RSUs will 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. Any
assignment, transfer, pledge, or other disposition in violation of the provisions of this
Section 8L will be null and

7

 

void and any Performance RSUs that are hedged in any manner will immediately be forfeited.

     L. Right to Discharge. Nothing contained in this Plan or in any award of Performance RSUs
will 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.

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

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

     N. Subject to Any AIG Section 162(m) Plan. AIG may, in any year, propose a Section 162(m)
compliant performance incentive award plan (the “AIG Section 162(m) Plan”). If an AIG Section
162(m) Plan is proposed and approved by the AIG shareholders in accordance with Section 162(m) of
the Code and Treasury Regulation Section 1.162-27(e)(4), this Plan will function as a sub-plan
under the AIG Section 162(m) Plan, whereby performance compensation amounts payable under the AIG
Section 162(m) Plan can be paid in part by earning Performance RSUs with respect to a Performance
Period. If the AIG Section 162(m) Plan is proposed and not so approved by the AIG shareholders,
any Performance RSUs awarded to participants in the AIG Section 162(m) Plan will terminate and no
Shares will be delivered with respect thereto.

     O. Adoption. This plan was originally adopted on March 15, 2006 by the Committee. This Plan
was amended and restated by the Committee on May 16, 2006, September 5, 2007, March 11, 2008, and
November 11, 2008.

	9.	 	Disputes

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     A. Governing Law. This Plan will be governed by and construed in accordance with the laws of
the State of New York, without regard to principles of conflict of laws.

     B. Dispute Resolution and Related Provisions. AIG agrees to the following provisions. By the
acceptance of any award of Performance RSUs, each Participant agrees to accept the provisions of
this Plan, including, without limitations, the following:

     (1) Arbitration. Subject to the provisions of this Section 9, any dispute,
controversy or claim between AIG and a Participant, arising out of or relating to or
concerning this Plan or any Performance RSUs will 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
Committee in accordance with claims procedures determined by the Committee.

     (2) Jurisdiction. 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 this Plan or any Performance RSUs that are not otherwise
arbitrated or resolved according to Section 9B(1). AIG and each Participant acknowledge
that the forum designated by this section has a reasonable relation to this Plan and to
such Participant’s relationship with AIG.

     (3) Waiver. 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 Section 9B(2). AIG and each Participant undertake not to commence
any action, suit or proceeding arising out of or relating to or concerning this Plan or any
Performance RSUs in any forum other than a forum described in Section 9B(2).

     (4) Service of Process. 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 this Plan or any Performance RSUs that are not otherwise arbitrated or resolved
according to Section 9B(1). The Secretary will promptly advise the Participant of any such
service of process.

     C. Confidentiality. By the acceptance of any award of Performance RSUs, each Participant
agrees to keep confidential any information concerning any grant made under this Plan and any
dispute, controversy or claim relating to this

9

 

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).

10. Term of Plan

     This Plan will continue until suspended or terminated by the Committee in its sole discretion.
Any termination of this Plan will be done in a manner that the Committee determines complies with
Section 409A.

10EX-10.62

Exhibit 10(62)

AMERICAN INTERNATIONAL GROUP, INC.

AMENDED AND RESTATED 2007 STOCK INCENTIVE PLAN

 

 

AMERICAN INTERNATIONAL GROUP, INC.

Amended and Restated 2007 Stock Incentive Plan

	 	 	 	 	 
	ARTICLE I —GENERAL
	 	 	1	 
	1.1 Purpose
	 	 	1	 
	1.2 Definitions of Certain Terms
	 	 	1	 
	1.3 Administration
	 	 	3	 
	1.4 Persons Eligible for Awards
	 	 	4	 
	1.5 Types of Awards Under Plan
	 	 	5	 
	1.6 Shares of Common Stock Available for Awards
	 	 	5	 
	 
	 	 	 	 
	ARTICLE II —AWARDS UNDER THE PLAN
	 	 	6	 
	2.1 Agreements Evidencing Awards
	 	 	6	 
	2.2 No Rights as a Shareholder
	 	 	6	 
	2.3 Options
	 	 	6	 
	2.4 Stock Appreciation Rights
	 	 	8	 
	2.5 Restricted Shares
	 	 	9	 
	2.6 Restricted Stock Units
	 	 	9	 
	2.7 Dividend Equivalent Rights
	 	 	9	 
	2.8 Other Stock-Based Awards
	 	 	10	 
	 
	 	 	 	 
	ARTICLE III —MISCELLANEOUS
	 	 	10	 
	3.1 Amendment of the Plan
	 	 	10	 
	3.2 Tax Withholding
	 	 	10	 
	3.3 Required Consents and Legends
	 	 	11	 
	3.4 Right of Offset
	 	 	11	 
	3.5 Nonassignability; No Hedging
	 	 	11	 
	3.6 Successor Entity
	 	 	12	 
	3.7 Right of Discharge Reserved
	 	 	12	 
	3.8 Nature of Payments
	 	 	12	 
	3.9 Non-Uniform Determinations
	 	 	12	 
	3.10 Other Payments or Awards
	 	 	13	 
	3.11 Plan Headings
	 	 	13	 
	3.12 Termination of Plan
	 	 	13	 
	3.13 Section 409A
	 	 	13	 
	3.14 Governing Law
	 	 	14	 
	3.15 Severability; Entire Agreement
	 	 	14	 
	3.16 Waiver of Claims
	 	 	15	 
	3.17 No Liability With Respect to Tax Qualification or Adverse Tax
Treatment
	 	 	15	 
	3.18 No Third Party Beneficiaries
	 	 	15	 
	3.19 Successors and Assigns of AIG
	 	 	15	 
	3.20 Date of Adoption and Approval of Shareholders
	 	 	16	 

-i-

 

AMERICAN INTERNATIONAL GROUP, INC.

Amended and Restated 2007 Stock Incentive Plan

ARTICLE I—GENERAL

1.1 Purpose

     The purpose of the American International Group, Inc. Amended and Restated 2007 Stock
Incentive Plan is to attract, retain and motivate officers, directors and key employees of American
International Group, Inc. and its consolidated subsidiaries, to compensate them for their
contributions to the long-term growth and profits of the Company and to encourage them to acquire a
proprietary interest in the success of the Company.

     This 2007 Stock Incentive Plan replaces the American International Group, Inc. Amended and
Restated 1999 Stock Option Plan (as amended to the Effective Date, the “Stock Option Plan”), the
American International Group, Inc. Amended and Restated 2002 Stock Incentive Plan (as amended to
the Effective Date, the “SIP”) and the American International Group, Inc. Director Stock Plan (as
amended to the Effective Date, the “Director Plan”) for Awards granted on or after the Effective
Date. Awards may not be granted under any of the Stock Option Plan, the SIP or the Director Plan
beginning on the Effective Date, but this 2007 Stock Incentive Plan will not affect the terms or
conditions of any stock option, restricted stock unit or other award made under the Stock Option
Plan, the SIP or the Director Plan before the Effective Date.

1.2 Definitions of Certain Terms

     For purposes of this 2007 Stock Incentive Plan, the following terms have the meanings set
forth below:

     “AIG” means American International Group, Inc. or a successor entity contemplated by Section
3.6.

     “Assurance Agreement” means the Assurance Agreement, by AIG in favor of eligible employees
dated as of June 27, 2005, relating to certain obligations of Starr International Company, Inc. (as
such agreement may be amended, supplemented, extended, modified or replaced from time to time).

     “Award” means an award made pursuant to the Plan.

     “Award Agreement” means the written document by which each Award is evidenced, and which may,
but need not be (as determined by the Committee) executed or acknowledged by a Grantee as a
condition to receiving an Award or the benefits under an Award, and which sets forth the terms and
provisions applicable to Awards granted under the Plan to such Grantee.

     “Board” means the Board of Directors of AIG.

 

 

     “Certificate” means a stock certificate (or other appropriate document or evidence of
ownership) representing shares of Common Stock.

     “Code” means the Internal Revenue Code of 1986, as amended from time to time, or any successor
thereto, and the applicable rulings and regulations thereunder.

     “Committee” has the meaning set forth in Section 1.3.1.

     “Common Stock” means the common stock of AIG, par value $2.50 per share, and any other
securities or property issued in exchange therefor or in lieu thereof pursuant to Section 1.6.4.

     “Company” means AIG and its consolidated subsidiaries.

     “Consent” has the meaning set forth in Section 3.3.2.

     “Covered Person” has the meaning set forth in Section 1.3.3.

     “Director” means a member of the Board or a member of the board of directors of a consolidated
subsidiary of AIG.

     “Effective Date” means May 16, 2007.

     “Employee” means a regular, active employee of the Company.

     “Employment” means a Grantee’s performance of services for the Company, as an Employee, as
determined by the Committee. The terms “employ” and “employed” will have their correlative
meanings.

     “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, or any
successor thereto, and the applicable rules and regulations thereunder.

     “Fair Market Value” means, with respect to a share of Common Stock on any day, the fair market
value as determined in accordance with a valuation methodology approved by the Committee, unless
determined as otherwise specified herein.

     “Grantee” means an Employee or Director who receives an Award.

     “Incentive Stock Option” means an option to purchase shares of Common Stock that is intended
to be designated as an “incentive stock option” within the meaning of Sections 421 and 422 of the
Code, as now constituted or subsequently amended, or pursuant to a successor of the Code, and which
is designated as an Incentive Stock Option in the applicable Award Agreement.

     “Non-Employee Director” means a Director who is a “non-employee director” within the meaning
of Rule 16b-3(b)(3) under the Exchange Act or any successor thereto.

     “Officer” means an Employee who is an “officer” within the meaning of Rule
16a-1(f) under the Exchange Act.

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     “Plan” means this American International Group, Inc. Amended and Restated 2007 Stock Incentive
Plan, as amended from time to time.

     “Plan Action” will have the meaning set forth in Section 3.3.1.

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

     “Securities Act” means the Securities Act of 1933, as amended from time to time, or any
successor thereto, and the applicable rules and regulations thereunder.

     “Treasury Regulations” means the regulations promulgated under the Code by the United States
Internal Revenue Service, as amended.

1.3 Administration

     1.3.1 The Compensation and Management Resources Committee of the Board (as constituted from
time to time, and including any successor committee, the “Committee”) will administer the Plan. The
members of the Committee will be drawn solely from such members of the Board who are not and have
not been Officers of the Company. The Committee is authorized, subject to the provisions of the
Plan, to establish such rules and regulations as it deems necessary for the proper administration
of the Plan and to make such determinations and interpretations and to take such action in
connection with the Plan and any Award granted thereunder as it deems necessary or advisable. All
determinations and interpretations made by the Committee will be final, binding and conclusive on
all Grantees and on their legal representatives and beneficiaries. The Committee will have the
authority, in its absolute discretion, to determine the persons who will receive Awards, the time
when Awards will be granted, the terms of such Awards and the number of shares of Common Stock, if
any, which will be subject to such Awards. Unless otherwise provided in an Award Agreement, the
Committee reserves the authority, in its absolute discretion (but subject to Section 3.13.1 in the
case of Awards made under the Plan that are intended to be “deferred compensation” subject to
Section 409A, including provisions thereof relating to payment of Awards upon death, disability or
retirement (either before or at normal retirement age)), to amend any outstanding Award Agreement
in any respect, whether or not the rights of the Grantee of such Award are adversely affected (but
subject to Sections 2.3.6 and 2.4.5), including, without limitation, to accelerate the time or
times at which the Award becomes vested, unrestricted or may be exercised, to waive or amend any
restrictions or conditions set forth in such Award Agreement, or to impose new restrictions and
conditions, or to reflect a change in the Grantee’s circumstances and (b) to determine whether, to
what extent and under what circumstances and method or methods (i) Awards may be (A) settled in
shares of Common Stock, other securities, other Awards or other property or (B) canceled, forfeited
or suspended, (ii) shares of Common Stock, other securities, other Awards or other property, and
other amounts payable with respect to an Award may be deferred either automatically or at the
election of the Grantee thereof or of the Committee and (iii) Awards may be settled by the Company
or any of its designees. Notwithstanding anything to the contrary contained herein, the Board may,
in its sole discretion, at any time and from time to

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time, grant Awards (other than grants to Directors) or administer the Plan, in which case the
Board will have all of the authority and responsibility granted to the Committee herein. If so
determined by the Committee, any Award made to an Officer will be made by the full Board or a
committee or subcommittee of the Board composed of at least two Non-Employee Directors of AIG.

     1.3.2 Actions of the Committee may be taken by the vote of a majority of its members. To the
extent not inconsistent with applicable law and the rules and regulations of the New York Stock
Exchange, (a) the Committee may delegate any of its powers under the Plan to a subcommittee of the
Committee or to one of its members, (b) the Committee may allocate among its members any of its
administrative responsibilities and (c) notwithstanding anything to the contrary contained herein,
the Committee may delegate the determination of Awards (and related administrative
responsibilities) to Employees who are not Officers to one or more officers of AIG designated by
the Committee from time to time.

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

1.4 Persons Eligible for Awards

     Awards under the Plan may be made to Employees and Directors.

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1.5 Types of Awards Under Plan

     Awards may be made under the Plan in the form of any of the following, in each case in respect
of Common Stock: (a) stock options, (b) stock appreciation rights, (c) restricted shares, (d)
restricted stock units, (e) dividend equivalent rights and (f) other equity-based or equity-related
Awards that the Committee determines to be consistent with the purposes of the Plan and the
interests of the Company.

1.6 Shares of Common Stock Available for Awards

     1.6.1 Common Stock Subject to the Plan. Subject to the other provisions of this Section 1.6,
the total number of shares of Common Stock that may be granted under the Plan is [•]. Such shares
of Common Stock may, in the discretion of the Committee, be either authorized but unissued shares
or shares previously issued and reacquired by AIG.

     1.6.2 Share Counting. The number of shares of Common Stock granted under the Plan per year
will be determined as follows: (a) each stock option, stock appreciation right and similar Award
will count as 1 share of Common Stock and (b) each restricted share, restricted stock unit and
similar Award will count as [2.9] shares of Common Stock. Shares of Common Stock issued in
connection with awards that are assumed, converted or substituted as a result of the Company’s
acquisition of another company (including by way of merger, combination or similar transaction)
will not count against the number of shares that may be issued under the Plan.

     1.6.3 Replacement of Shares. If any Award is forfeited, expires, terminates or otherwise
lapses, in whole or in part, without the delivery of Common Stock, then the shares of Common Stock
covered by such forfeited, expired, terminated or lapsed award (counted in accordance with Section
1.6.2) will again be available for grant under the Plan. In addition, the following will be added
to the number of shares available for grant under the Plan: (1) the number of shares of Common
Stock underlying awards granted and outstanding under the Stock Option Plan before the Effective
Date that are forfeited, expire, terminate or otherwise lapse on or after the Effective Date, in
whole or in part, without the delivery of Common Stock and (2) the number of shares of Common Stock
underlying awards granted and outstanding under the SIP before the Effective Date that are
forfeited, expire, terminate or otherwise lapse on or after the Effective Date, in whole or in
part, without the delivery of Common Stock (in each case, counted in accordance with Section
1.6.2). For the avoidance of doubt, the following shall not again become available for issuance
under the Plan: (A) any shares of Common Stock withheld in respect of taxes, (B) any shares
tendered or withheld to pay the exercise price of stock options, (C) any shares repurchased by the
Company from the optionee with the proceeds from the exercise of stock options and (D) any shares
subject to stock appreciation rights but not issued on exercise as a result of the operation of
Section 2.4.4.

     1.6.4 [Adjustments. The Committee [will] adjust the number of shares of Common Stock
authorized pursuant to Section 1.6.1 and adjust equitably the terms of any outstanding Awards (including, without limitation, the number of shares of Common Stock
covered by each outstanding Award, the type of property to which the Award is subject and the
exercise or strike price of any Award), in such manner as it deems appropriate (including, without
limitation, by payment of cash) to preserve the

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benefits or potential benefits intended to be made
available to grantees of Awards, for any increase or decrease in the number of issued shares of
Common Stock resulting from a recapitalization, stock split, stock dividend, combination or
exchange of shares of Common Stock, merger, consolidation, rights offering, separation,
reorganization or liquidation, or any other change in the corporate structure or shares of AIG;
provided that no such adjustment shall be made if or to the extent that it would cause any
outstanding Award to fail to comply with Section 409A. After any adjustment made pursuant to this
Section 1.6.4, the number of shares of Common Stock subject to each outstanding Award will be
rounded down to the nearest whole number. Notwithstanding the foregoing, the Committee may, in its
sole discretion, decline to adjust the terms of any outstanding Award if it determines that such
adjustment would violate applicable law or result in adverse tax consequences to the Grantee or to
the Company.]

ARTICLE II—AWARDS UNDER THE PLAN

2.1 Agreements Evidencing Awards

     Each Award granted under the Plan will be evidenced by an Award Agreement that will contain
such provisions and conditions as the Committee deems appropriate. Unless otherwise provided
herein, the Committee may grant Awards in tandem with or, subject to Section 3.13.1, in
substitution for any other Award or Awards granted under the Plan or any award granted under any
other plan of AIG. By accepting an Award pursuant to the Plan, a Grantee thereby agrees that the
Award will be subject to all of the terms and provisions of the Plan and the applicable Award
Agreement.

2.2 No Rights as a Shareholder

     No Grantee (or other person having rights pursuant to an Award) shall have any of the rights
of a shareholder of AIG with respect to shares of Common Stock subject to an Award until the
delivery of such shares. Except as otherwise provided in Section 1.6.4, no adjustments will be made
for dividends, distributions or other rights (whether ordinary or extraordinary, and whether in
cash, Common Stock, other securities or other property) for which the record date is before the
date the Certificates for the shares are delivered.

2.3 Options

     2.3.1 Grant. Stock options may be granted to eligible recipients in such number and at such
times during the term of the Plan as the Committee or the Board may determine; provided, however,
that the maximum number of shares of Common Stock as to which stock options may be granted under the Plan to any one individual in any one
year may not exceed 1,000,000 shares (as adjusted pursuant to the provisions of Section 1.6.4).

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     2.3.2 Incentive Stock Options. At the time of grant, the Committee will determine (a) whether
all or any part of a stock option granted to an eligible employee will be an Incentive Stock Option
and (b) the number of shares subject to such Incentive Stock Option; provided, however, that (1)
the aggregate fair market value (determined as of the time the option is granted) of the stock with
respect to which Incentive Stock Options are exercisable for the first time by an eligible employee
during any calendar year (under all such plans of AIG and of any subsidiary corporation of AIG)
will not exceed $100,000 and (2) no Incentive Stock Option (other than an Incentive Stock Option
that may be assumed or issued by the Company in connection with a transaction to which Section
424(a) of the Code applies) may be granted to a person who is not eligible to receive an Incentive
Stock Option under the Code. The form of any stock option which is entirely or in part an Incentive
Stock Option will clearly indicate that such stock option is an Incentive Stock Option or, if
applicable, the number of shares subject to the Incentive Stock Option.

     2.3.3 Exercise Price. The exercise price per share with respect to each stock option will be
determined by the Committee but, except as otherwise permitted by Section 1.6.4, may never be less
than the Fair Market Value of the Common Stock. Unless otherwise noted in the Award Agreement, the
Fair Market Value of the Common Stock will be its closing price on the New York Stock Exchange on
the date of grant of the Award of stock options.

     2.3.4 Term of Stock Option. In no event will any stock option be exercisable after the
expiration of 10 years from the date on which the stock option is granted.

     2.3.5 Exercise of Stock Option and Payment for Shares. The shares of Common Stock covered by
each stock option may not be purchased for one year after the date on which the stock option is
granted (except in the case of termination of Employment due to death, disability or retirement),
but thereafter may be purchased in such installments as will be determined in the Award Agreement
at the time the stock option is granted. Subject to any limitations in the applicable Award
Agreement, any shares not purchased on the applicable installment date may be purchased thereafter
at any time before the final expiration of the stock option. To exercise a stock option, the
Grantee must give written notice to AIG specifying the number of shares to be purchased and
accompanied by payment of the full purchase price therefor in cash or by certified or official bank
check or in another form as determined by the Company, including: (a) personal check, (b) shares of
Common Stock, valued as of the exercise date, of the same class as those to be granted by exercise
of the stock option, (c) any other form of consideration approved by the Company and permitted by
applicable law and (d) any combination of the foregoing. Any person exercising a stock option will
make such representations and agreements and furnish such information as the Committee may in its
discretion deem necessary or desirable to assure compliance by AIG, on terms acceptable to AIG,
with the provisions of the Securities Act and any other applicable legal requirements. If a Grantee
so requests, shares purchased may be issued in the name of the Grantee and another jointly with the
right of survivorship.

     2.3.6 Repricing. Except as otherwise permitted by Section 1.6.4, reducing the exercise price
of stock options issued and outstanding under the Plan, including through amendment, cancellation
in exchange for the grant of a substitute Award or repurchase for cash or other consideration (in
each case that has the effect of reducing the exercise price), will require approval of the
shareholders.

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2.4 Stock Appreciation Rights

     2.4.1 Grant. Stock appreciation rights may be granted to eligible recipients in such number
and at such times during the term of the Plan as the Committee or the Board may determine;
provided, however, that the maximum number of shares of Common Stock as to which stock appreciation
rights may be granted under the Plan to any one individual in any one year may not exceed 1,000,000
shares (as adjusted pursuant to the provisions of Section 1.6.4).

     2.4.2 Exercise Price. The exercise price per share with respect to each stock appreciation
right will be determined by the Committee but, except as otherwise permitted by Section 1.6.4, may
never be less than the Fair Market Value of the Common Stock. Unless otherwise noted in the Award
Agreement, the Fair Market Value of the Common Stock will be its closing price on the New York
Stock Exchange on the date of grant of the Award of stock appreciation rights.

     2.4.3 Term of Stock Appreciation Right. In no event will any stock appreciation right be
exercisable after the expiration of 10 years from the date on which the Stock Appreciation Right is
granted.

     2.4.4 Exercise of Stock Appreciation Right and Delivery of Shares. Each stock appreciation
right may not be exercised for one year after the date on which the stock appreciation right is
granted (except in the case of termination of Employment due to death, disability or retirement),
but thereafter may be exercised in such installments as may be determined in the Award Agreement at
the time the stock appreciation right is granted. Subject to any limitations in the applicable
Award Agreement, any stock appreciation rights not exercised on the applicable installment date may
be exercised thereafter at any time before the final expiration of the stock appreciation right. To
exercise a stock appreciation right, the Grantee must give written notice to AIG specifying the
number of stock appreciation rights to be exercised. Upon exercise of stock appreciation rights,
shares of Common Stock with a Fair Market Value equal to (a) the excess of (1) the Fair Market
Value of the Common Stock on the date of exercise over (2) the exercise price of such stock
appreciation right multiplied by (b) the number of stock appreciation rights exercised will be
delivered to the Grantee. Any person exercising a stock appreciation right will make such
representations and agreements and furnish such information as the Committee may in its discretion
deem necessary or desirable to assure compliance by AIG, on terms acceptable to AIG, with the
provisions of the Securities Act and any other applicable legal requirements. If a Grantee so
requests, shares purchased may be issued in the name of the Grantee and another jointly with the
right of survivorship.

     2.4.5 Repricing. Except as otherwise permitted by Section 1.6.4, reducing the exercise price
of stock appreciation rights issued and outstanding under the Plan, including through amendment,
cancellation in exchange for the grant of a substitute Award or repurchase for cash or other consideration (in each case that has the effect of
reducing the exercise price), will require approval of the shareholders.

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2.5 Restricted Shares

     2.5.1 Grants. The Committee may grant or offer for sale restricted shares in such amounts and
subject to such terms and conditions as the Committee may determine. Upon the delivery of such
shares, the Grantee will have the rights of a shareholder with respect to the restricted shares,
subject to any restrictions and conditions as the Committee may include in the applicable Award
Agreement. In the event that a Certificate is issued in respect of restricted shares, such
Certificate may be registered in the name of the Grantee but will be held by AIG or its designated
agent until the time the restrictions lapse.

     2.5.2 Right to Vote and Receive Dividends on Restricted Shares. Each Grantee of an Award of
restricted shares will, during the period of restriction, be the beneficial and record owner of
such restricted shares and will have full voting rights with respect thereto. Unless the Committee
determines otherwise in an Award Agreement, during the period of restriction, all ordinary cash
dividends (as determined by the Committee in its sole discretion) paid upon any restricted share
will be retained by the Company for the account of the relevant Grantee. Such dividends will revert
back to the Company if for any reason the restricted share upon which such dividends were paid
reverts back to the Company. Upon the expiration of the period of restriction, all such dividends
made on such restricted share and retained by the Company will be paid to the relevant Grantee.
Unless the applicable Award Agreement provides otherwise, additional shares or other property
distributed to the Grantee in respect of restricted shares, as dividends or otherwise, will be
subject to the same restrictions applicable to such restricted shares.

2.6 Restricted Stock Units

     The Committee may grant Awards of restricted stock units in such amounts and subject to such
terms and conditions as the Committee may determine. A Grantee of a restricted stock unit will have
only the rights of a general unsecured creditor of AIG until delivery of shares of Common Stock or
other securities or property is made as specified in the applicable Award Agreement. On the
delivery date specified in the Award Agreement, the Grantee of each restricted stock unit not
previously forfeited or terminated will receive one share of Common Stock, or securities or other
property equal in value to a share of Common Stock or a combination thereof, as specified by the
Committee.

2.7 Dividend Equivalent Rights

     The Committee may include in the Award Agreement with respect to any Award a dividend
equivalent right entitling the Grantee to receive amounts equal to all or any portion of the
dividends that would be paid on the shares of Common Stock covered by such Award if such shares had
been delivered pursuant to such Award. The grantee of a dividend equivalent right will have only
the rights of a general unsecured creditor of AIG until payment of such amounts is made as specified in the applicable Award
Agreement. In the event such a provision is included in an Award Agreement, the Committee will,
subject to Section 3.13.1, determine whether such payments will be made in cash, in shares of
Common Stock or in another form, whether they will

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be conditioned upon the exercise of the Award to
which they relate, the time or times at which they will
be made, and such other terms and conditions as the Committee will deem appropriate.

2.8 Other Stock-Based Awards

     The Committee may grant other types of equity-based or equity-related Awards (including the
grant or offer for sale of unrestricted shares of Common Stock) in such amounts and subject to such
terms and conditions as the Committee may determine. Such Awards may entail the transfer of actual
shares of Common Stock to Award recipients and may include Awards designed to comply with or take
advantage of the applicable local laws of jurisdictions other than the United States.

ARTICLE III—MISCELLANEOUS

3.1 Amendment of the Plan

     3.1.1 Unless otherwise provided in an Award Agreement, the Board may from time to time
suspend, discontinue, revise or amend the Plan in any respect whatsoever, including in any manner
that adversely affects the rights, duties or obligations of any Grantee of an Award.

     3.1.2 Unless otherwise determined by the Board, shareholder approval of any suspension,
discontinuance, revision or amendment will be obtained only to the extent necessary to comply with
any applicable laws, regulations or rules of a securities exchange or self-regulatory agency.

3.2 Tax Withholding

     Grantees shall be solely responsible for any applicable taxes (including, without limitation,
income and excise taxes) and penalties, and any interest that accrues thereon, that they incur in
connection with the receipt, vesting or exercise of any Award. As a condition to the delivery of
any shares of Common Stock pursuant to any Award or the lifting or lapse of restrictions on any
Award, or in connection with any other event that gives rise to a federal or other governmental tax
withholding obligation on the part of the Company relating to an Award (including, without
limitation, FICA tax), (a) the Company may deduct or withhold (or cause to be deducted or withheld)
from any payment or distribution to a Grantee whether or not pursuant to the Plan (including shares
of Common Stock otherwise deliverable) or (b) the Committee will be entitled to require that the
Grantee remit cash to the Company (through payroll deduction or otherwise), in each case in an
amount sufficient in the opinion of the Company to satisfy such withholding obligation.

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3.3 Required Consents and Legends

     3.3.1 If the Committee at any time determines that any Consent (as hereinafter defined) is
necessary or desirable as a condition of, or in connection with, the granting of any Award, the
delivery of shares of Common Stock or the delivery of any securities or other property under the
Plan, or the taking of any other action thereunder (each such action a “Plan Action”), then,
subject to Section 3.13.2, such Plan Action will not be taken, in whole or in part, unless and
until such Consent will have been effected or obtained to the full satisfaction of the Committee.
The Committee may direct that any Certificate evidencing shares delivered pursuant to the Plan will
bear a legend setting forth such restrictions on transferability as the Committee may determine to
be necessary or desirable, and may advise the transfer agent to place a stop transfer order against
any legended shares.

     3.3.2 The term “Consent” as used in this Article III with respect to any Plan Action 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) or any other matter, which the Committee may deem necessary or
desirable to comply with the terms of any such listing, registration or qualification or to obtain
an exemption from the requirement that any such listing, qualification or registration be made, (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 or other documentation required by the Committee. Nothing herein will require the
Company to list, register or qualify the shares of Common Stock on any securities exchange.

3.4 Right of Offset

     Except with respect to Awards made under the Plan that are intended to be “deferred
compensation” subject to Section 409A, the Company will have the right to offset against its
obligation to deliver shares of Common Stock (or other property) under the Plan or any Award
Agreement any outstanding amounts (including, without limitation, travel and entertainment or
advance account balances, loans, repayment obligations under any Awards, or amounts repayable to
the Company pursuant to tax equalization, housing, automobile or other employee programs) that the
Grantee then owes to the Company and any amounts the Committee otherwise deems appropriate pursuant
to any tax equalization policy or agreement.

3.5 Nonassignability; No Hedging

     No Award (or any rights and obligations thereunder) granted to any person under the Plan may
be sold, exchanged, transferred, assigned, pledged, hypothecated or otherwise disposed of or
hedged, in any manner (including through the use of any cash-settled instrument), whether
voluntarily or involuntarily and whether by operation of law or otherwise, other than by will or by
the laws of descent and distribution. Any sale, exchange, transfer, assignment, pledge,
hypothecation, or other disposition in violation of the provisions of this Section 3.5 will be null
and void and any Award which is hedged in any manner will immediately be forfeited. All of

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the terms and conditions of the Plan and the Award Agreements will be binding upon any
permitted successors and assigns.

3.6 Successor Entity

     Unless otherwise provided in the applicable Award Agreement and except as otherwise determined
by the Committee, in the event of a merger, consolidation, mandatory share exchange or other
similar business combination of AIG with or into any other entity (“Successor Entity”) or any
transaction in which another person or entity acquires all of the issued and outstanding Common
Stock of AIG, or all or substantially all of the assets of AIG, outstanding Awards may be assumed
or a substantially equivalent award may be substituted by such successor entity or a parent or
subsidiary of such successor entity.

3.7 Right of Discharge Reserved

     Nothing in the Plan or in any Award Agreement will confer upon any Grantee the right to
continued Employment by the Company or affect any right which the Company may have to terminate
such Employment.

3.8 Nature of Payments

     3.8.1 Any and all grants of Awards and deliveries of Common Stock, securities or other
property under the Plan will be in consideration of services performed or to be performed for the
Company by the Grantee. Awards under the Plan may, in the discretion of the Committee, and subject
to Section 3.13.1, be made in substitution in whole or in part for cash or other compensation
otherwise payable to a participant in the Plan. Only whole shares of Common Stock will be delivered
under the Plan. Awards will, to the extent reasonably practicable, be aggregated in order to
eliminate any fractional shares. Fractional shares may, in the discretion of the Committee, be
forfeited or be settled in cash or otherwise as the Committee may determine.

     3.8.2 All such grants and deliveries will constitute a special discretionary incentive payment
to the Grantee and will not be required to be taken into account in computing the amount of salary
or compensation of the Grantee 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 Company or under any agreement with the Grantee, unless the Company specifically
provides otherwise.

3.9 Non-Uniform Determinations

     3.9.1 The Committee’s determinations under the Plan and Award Agreements need not be uniform
and may be made by it selectively among persons who receive, or are eligible to receive, Awards
under the Plan (whether or not such persons are similarly situated). Without limiting the
generality of the foregoing, the Committee

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will be entitled, among other things, to make non-uniform and selective determinations under
Award Agreements, and to enter into non-uniform and selective Award Agreements, as to (a) the
persons to receive Awards, (b) the terms and provisions of Awards and (c) whether a Grantee’s
Employment has been terminated for purposes of the Plan.

     3.9.2 To the extent the Committee deems it necessary, appropriate or desirable to comply with
foreign law or practices and to further the purposes of the Plan, the Committee may, without
amending the Plan, establish special rules applicable to Awards to Grantees who are foreign
nationals, are employed outside the United States or both and grant Awards (or amend existing
Awards) in accordance with those rules.

3.10 Other Payments or Awards

     Nothing contained in the Plan will be deemed in any way to limit or restrict the Company from
making any award or payment to any person under any other plan, arrangement or understanding,
whether now existing or hereafter in effect.

3.11 Plan Headings

     The headings in the Plan are for the purpose of convenience only and are not intended to
define or limit the construction of the provisions hereof.

3.12 Termination of Plan

     The Board reserves the right to terminate the Plan at any time; provided, however, that in any
case, the Plan will terminate May 16, 2017, and provided further, that all Awards made under the
Plan before its termination will remain in effect until such Awards have been satisfied or
terminated in accordance with the terms and provisions of the Plan and the applicable Award
Agreements.

3.13 Section 409A

     3.13.1 All Awards made under the Plan that are intended to be “deferred compensation” subject
to Section 409A shall be interpreted, administered and construed to comply with Section 409A, and
all Awards made under the Plan that are intended to be exempt from Section 409A shall be
interpreted, administered and construed to comply with and preserve such exemption. The Board and
the Committee shall have full authority to give effect to the intent of the foregoing sentence. To
the extent necessary to give effect to this intent, in the case of any conflict or potential
inconsistency between the Plan and a provision of any Award or Award Agreement with respect to an
Award, the Plan shall govern.

     3.13.2 Without limiting the generality of Section 3.13.1, with respect to any Award made under
the Plan that is intended to be “deferred compensation” subject

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to Section 409A: (a) references to termination of the Grantee’s employment will mean the
Grantee’s separation from service with the Company within the meaning of Section 409A; (b) any
payment to be made with respect to such Award in connection with the Grantee’s separation from
service with the Company within the meaning of Section 409A that would be subject to the
limitations in Section 409A(a)(2)(b) of the Code shall be delayed until six months after the
Grantee’s separation from service (or earlier death) in accordance with the requirements of Section
409A; (c) to the extent necessary to comply with Section 409A, any other securities, other Awards
or other property that the Company may deliver in lieu of shares of Common Stock in respect of an
Award shall not have the effect of deferring delivery or payment beyond the date on which such
delivery or payment would occur with respect to the shares of Common Stock that would otherwise
have been deliverable (unless the Committee elects a later date for this purpose in accordance with
the requirements of Section 409A); (d) with respect to any required Consent described in Section
3.3 or the applicable Award Agreement, if such Consent has not been effected or obtained as of the
latest date provided by such Award Agreement for payment in respect of such Award and further delay
of payment is not permitted in accordance with the requirements of Section 409A, such Award or
portion thereof, as applicable, will be forfeited and terminate notwithstanding any prior earning
or vesting; (e) if the Award includes a “series of installment payments” (within the meaning of
Section
1.409A-2(b)(2)(iii) of the Treasury Regulations), the Grantee’s right to the series of
installment payments shall be treated as a right to a series of separate payments and not as a
right to a single payment; (f) if the Award includes “dividend equivalents” (within the meaning of
Section 1.409A-3(e) of the Treasury Regulations), the Grantee’s right to the dividend equivalents
shall be treated separately from the right to other amounts under the Award; and (g) unless the
Committee determines otherwise, for purposes of determining whether the Grantee has experienced a
separation from service with the Company within the meaning of Section 409A, “subsidiary” shall
mean a corporation or other entity in a chain of corporations or other entities in which each
corporation or other entity, starting with AIG, has a controlling interest in another corporation
or other entity in the chain, ending with such corporation or other entity. For purposes of the
preceding sentence, the term “controlling interest” has the same meaning as provided in Section
1.414(c)-2(b)(2)(i) of the Treasury Regulations, provided that the language “at least 20 percent”
is used instead of “at least 80 percent” each place it appears in Section 1.414(c)-2(b)(2)(i) of
the Treasury Regulations.

3.14 Governing Law

     THE PLAN WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.

3.15 Severability; Entire Agreement

     If any of the provisions of the Plan or any Award Agreement is finally held to be invalid,
illegal or unenforceable (whether in whole or in part), such provision will be deemed modified to
the extent, but only to the extent, of such invalidity, illegality or unenforceability and the
remaining provisions will not be affected thereby; provided

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that if any of such provisions is finally held to be invalid, illegal, or unenforceable
because it exceeds the maximum scope determined to be acceptable to permit such provision to be
enforceable, such provision will be deemed to be modified to the minimum extent necessary to modify
such scope in order to make such provision enforceable hereunder. The Plan and any Award Agreements
contain the entire agreement of the parties with respect to the subject matter thereof and
supersede all prior agreements, promises, covenants, arrangements, communications, representations
and warranties between them, whether written or oral with respect to the subject matter thereof.

3.16 Waiver of Claims

     Each Grantee of an Award recognizes and agrees that before being selected by the Committee to
receive an Award he or she has no right to any benefits hereunder. Accordingly, in consideration of
the Grantee’s receipt of any Award hereunder, he or she expressly waives any right to contest the
amount of any Award, the terms of any Award Agreement, any determination, action or omission
hereunder or under any Award Agreement by the Committee, the Company or the Board, or any amendment
to the Plan or any Award Agreement (other than an amendment to the Plan or an Award Agreement to
which his or her consent is expressly required by the express terms of an Award Agreement).

3.17 No Liability With Respect to Tax Qualification or Adverse Tax Treatment

     Notwithstanding anything to the contrary contained herein, in no event shall the Company be
liable to a Grantee on account of an Award’s failure to (a) qualify for favorable United States or
foreign tax treatment or (b) avoid adverse tax treatment under United States or foreign law,
including, without limitation, Section 409A.

3.18 No Third Party Beneficiaries

     Except as expressly provided therein, neither the Plan nor any Award Agreement will confer on
any person other than the Company and the Grantee of any Award any rights or remedies thereunder.
The exculpation and indemnification provisions of Section 1.3.2 will inure to the benefit of a
Covered Person’s estate and beneficiaries and legatees.

3.19 Successors and Assigns of AIG

     The terms of the Plan will be binding upon and inure to the benefit of AIG and any successor
entity contemplated by Section 3.6.

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3.20 Date of Adoption and Approval of Shareholders

     The Plan was adopted on March 14, 2007 by the Board and approved by the shareholders of AIG at
the 2007 Annual Meeting of Shareholders. The Plan was amended and restated by the Board on November
14, 2007, November 11, 2008, and [December •], 2008, which amendment and restatement was approved
by the shareholders of AIG at the 2008 Special Meeting of Shareholders held on [December •], 2008.

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