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I am pleased to
confirm the terms of your employment with American International
Group, Inc.
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1.
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Effective Date
. August 10,
2009.
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2.
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Position. On the Effective Date, you will
begin to serve as President and Chief Executive Officer of AIG. In
that capacity, you will report directly (and only) to the Board of
Directors and have all of the customary authorities, duties and
responsibilities that accompany these positions.
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3.
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Salary (Cash)
. Your initial cash
salary will be $3,000,000 per year.
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4.
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Salary (Stock)
. In addition to your
cash salary, you will eligible to receive bi-monthly awards of
stock or phantom stock units in AIG. These awards, which we refer
to as stock salary, will be at an initial rate of $4,000,000 per
year and will be subject to the following additional
terms:
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Initially your stock salary will be
in the form of shares of AIG. Subject to the approval of the Office
of the Special Master for TARP Executive Compensation, AIG’s
Compensation and Management Resources Committee (in consultation
with you) may change the specific form of stock salary from time to
time;
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Stock will be immediately vested
when delivered, tax will be withheld by AIG in kind (unless
otherwise directed by you) and remaining shares cannot be sold
until the 5th anniversary of the Effective Date;
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Phantom stock units will be
immediately vested but will not be delivered until the 2nd
anniversary of grant, and units will be settled in cash or stock at
the election of the Committee (in consultation with you) and taxed
on delivery and, in the case of stock delivered, may be subject to
restrictions on transfer up to the 5th anniversary of the Effective
Date at the Committee’s discretion (phantom stock units will
not be used without prior approval of the Office of the Special
Master); and
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The
Committee will authorize early transferability of any stock salary
you have received on death or disability.
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AIG
is in the process of developing the specifics of your stock salary
for 2009, which will be retroactive to the Effective Date once
finalized. AIG will make these stock awards to you pursuant to a
more detailed award agreement, which will govern the
awards.
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5.
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Annual Long-Term Award
. Each year you will be
eligible to receive a long-term incentive award of up to $3,500,000
in the form of stock or phantom stock units in AIG. The amount for
2009 will be prorated from the Effective Date. The Committee will
determine the form and amount annually based on its performance
assessment, subject to the following:
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Stock or phantom stock units would
vest on the 2nd anniversary of grant (the minimum time required by
the
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