8-KLeadership Changes

AMERICAN INTERNATIONAL GROUP, INC. 8-K Report, Executive Changes (Jan 7, 2009)

Filed January 7, 2009For Securities:AIG

Summary

This 8-K filing from American International Group (AIG) dated January 7, 2009, primarily concerns changes to certain executive deferred compensation and incentive savings plans. Specifically, AIG decided on December 31, 2008, to alter the previously scheduled termination and distribution of account balances under 14 legacy elective deferred compensation plans. Instead of distributing to all participants by April 1, 2009, AIG will now only distribute to current agents and employees, excluding former employees and agents, as well as current executive officers. This decision impacts approximately $273.5 million in aggregate account balances, with about $6.0 million held by participants in the Senior Partners Plan, including $3.0 million by executive officers. While new deferrals under these plans will cease after December 31, 2008, existing account balances will continue to be invested and accrue earnings until distribution. This move signals a potential adjustment in how AIG is managing executive compensation and liabilities amidst prevailing market conditions and company circumstances.

Key Highlights

  • 1AIG modified the termination and distribution schedule for 14 legacy deferred compensation plans on December 31, 2008.
  • 2Distributions are now limited to current agents and employees, excluding former employees/agents and current executive officers.
  • 3Approximately $273.5 million in total account balances are affected by this change.
  • 4Executive officers' share of the affected accounts is approximately $3.0 million.
  • 5No new deferrals will be accepted under these plans after December 31, 2008.
  • 6Existing account balances will remain invested and continue to accrue earnings until distribution.
  • 7The plans will otherwise continue according to their terms for remaining participants.

Frequently Asked Questions

The filing concerns changes to the AIG Supplemental Incentive Savings Plan, the AIG Executive Deferred Compensation Plan, the SunAmerica Executive Savings Plan, and 11 other legacy elective deferred compensation plans of AIG subsidiaries that AIG assumed through acquisitions.

Current executive officers, former employees, and former agents are excluded from receiving distributions from these specific legacy plans as a result of the December 31, 2008, determination.

Yes, the account balances will remain invested and continue to accrue earnings until they are distributed. Distributions were initially scheduled by April 1, 2009, but the new terms apply to current agents and employees. The plans will continue to operate according to their terms for participants who remain after April 1, 2009, including scheduled and permitted distributions.

As of November 12, 2008, the aggregate account balances in these plans held by all participants expected to receive distributions under the new terms were approximately $273.5 million. Of this, approximately $6.0 million was held by participants in the Senior Partners Plan, including about $3.0 million held by executive officers.