8-KLeadership ChangesRegulation FDExhibits & Filings

AMERICAN INTERNATIONAL GROUP, INC. 8-K Report, Executive Changes (Aug 17, 2009)

Filed August 17, 2009For Securities:AIG

Summary

This Form 8-K filing from American International Group, Inc. (AIG) on August 17, 2009, primarily details the compensation agreement for Robert H. Benmosche upon his appointment as President and Chief Executive Officer. The agreement, effective August 16, 2009, outlines a compensation package that includes a base salary and equity, with specific restrictions and approvals required due to AIG's participation in the Troubled Asset Relief Program (TARP). Investors should note the significant cash and stock components of his pay, as well as the potential for performance-based awards, all subject to TARP regulations. Furthermore, the filing indicates that Mr. Benmosche was formally elected to his leadership positions by the Board of Directors after a thorough review process. The report also references related party guidelines concerning Mr. Benmosche's interests in MetLife, Inc., suggesting a need for transparency and potential conflict management related to his existing holdings. The approval in principle from the Special Master for TARP Executive Compensation highlights the regulatory oversight influencing these executive decisions.

Key Highlights

  • 1Robert H. Benmosche appointed President, CEO, and Director of AIG, effective August 16, 2009.
  • 2Benmosche's compensation package includes an annual salary of $7 million ($3 million cash, $4 million in fully-vested AIG common stock).
  • 3Stock portion of salary is non-transferable for five years, with exceptions for death or disability, subject to Compensation Committee approval.
  • 4Eligible for annual performance-based incentive award of up to $3.5 million (prorated for 2009) in stock or phantom stock, subject to vesting and TARP regulations.
  • 5No severance entitlement for Benmosche upon termination of employment.
  • 6Compensation structure received approval in principle from the Special Master for TARP Executive Compensation.
  • 7Board adopted Related Party Guidelines regarding Benmosche's interests in MetLife, Inc.

Frequently Asked Questions

Mr. Benmosche's compensation includes an annual salary of $7 million, comprised of $3 million in cash and $4 million in fully-vested AIG common stock. He is also eligible for an annual performance-based incentive award of up to $3.5 million, subject to specific conditions and TARP regulations.

Yes, the $4 million in AIG common stock granted as part of his salary is non-transferable for five years, except in cases of death or disability with approval from AIG's Compensation Committee. His performance-based awards are also subject to vesting, transfer, and payout restrictions under applicable TARP regulations.

The compensation structure has received approval in principle from the Special Master for TARP Executive Compensation. The full agreement has been submitted for review and approval as required by applicable TARP regulations.

The adoption of Related Party Guidelines addresses potential conflicts of interest arising from Mr. Benmosche's existing interests in MetLife, Inc. This indicates that AIG is implementing measures to manage and disclose these relationships as required, particularly given his new executive role.