Attached files
file | filename |
---|---|
EX-31 - EX-31 - AMERICAN INTERNATIONAL GROUP, INC. | y86062exv31.htm |
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-K/A
(Amendment
No. 2)
(Mark One)
þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 31, 2009
or
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number 1-8787
American International Group, Inc.
(Exact name of registrant as specified in its charter)
Delaware (State or other jurisdiction of incorporation or organization) |
13-2592361 (I.R.S. Employer Identification No.) |
|
70 Pine Street, New York, New York (Address of principal executive offices) |
10270 (Zip Code) |
Registrants telephone number, including area code (212) 770-7000
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Name of each exchange on which registered | |
Common Stock, Par Value $2.50 Per Share | New York Stock Exchange | |
5.75% Series A-2 Junior Subordinated Debentures | New York Stock Exchange | |
4.875% Series A-3 Junior Subordinated Debentures | New York Stock Exchange | |
6.45% Series A-4 Junior Subordinated Debentures | New York Stock Exchange | |
7.70% Series A-5 Junior Subordinated Debentures | New York Stock Exchange | |
Corporate Units (composed of stock purchase contracts and junior subordinated debentures) |
New York Stock Exchange |
|
NIKKEI 225® Index Market Index Target-Term Securities® due January 5, 2011 | NYSE Arca |
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined
in Rule 405 of the Securities Act.
Yes þ No o
Indicate by check mark if the registrant is not required to file reports pursuant to Section
13 or Section 15(d) of the Act.
Yes o No þ
Indicate by check mark whether the registrant (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes þ No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation
S-K is not contained herein, and will not be contained, to the best of registrants knowledge, in
definitive proxy or information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated
filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large
accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Act.
Large accelerated filer þ |
Accelerated filer o | Non-accelerated filer o | Smaller reporting company o | |||||||||
(Do not check if a smaller reporting company) |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of
the Exchange Act).
Yes o No þ
The aggregate market value of the voting and nonvoting common equity held by nonaffiliates of
the registrant computed by reference to the price at which the common equity was last sold of
$34.44 as of June 30, 2010 (the last business day of the registrants most recently completed
second fiscal quarter), was approximately $4,168,000,000.
As
of July 30, 2010, there were outstanding 135,126,343 shares of Common Stock, $2.50 par
value per share, of the registrant.
DOCUMENTS INCORPORATED BY REFERENCE
None
TABLE OF CONTENTS
Item 11. Executive Compensation | ||||||||
Item 15. Exhibits, Financial Statement Schedules | ||||||||
SIGNATURES | ||||||||
EX-31 |
Table of Contents
Explanatory Note
Information required by Item 11 of Form 10-K
was incorporated into the Annual Report on
Form 10-K of American International Group, Inc. (AIG) for the year ended December 31, 2009 (as amended,
the 2009 Annual Report on Form 10-K) by reference to the definitive proxy statement for AIGs 2010
Annual Meeting of Shareholders, dated April 12, 2010 (the 2010 Proxy Statement).
This amendment (Amendment No. 2) to the 2009 Annual Report on Form 10-K is being filed
solely for the purpose of providing additional detail regarding the compensation of the executive officers of AIG that were named
in the 2010 Proxy Statement (the named executives). This additional detail relates to the determination of the incentive compensation awards to the named executives. Other
than this additional detail, no other information provided under Item 11 of the 2009 Annual Report
on Form 10-K and no other Item of the 2009 Annual Report on Form 10-K is affected by this Amendment No. 2.
AIG does not consider the information provided in this Amendment No. 2 to constitute a material change to the
Item 11 disclosure in the 2010 Proxy Statement. All unchanged information has been omitted from this Amendment No. 2.
Item 11. Executive Compensation
The
information included in the section Compensation Discussion and
Analysis Compensation Decisions for 2009 Incentive Awards of
the 2010 Proxy Statement is hereby deleted and replaced in its entirety by the following:
Incentive Awards. For each of the current named executives, the Special Master required that
incentive awards be granted based on objective performance metrics developed in consultation with
the Special Master, and for Mr. Benmosche, the Special Master was also required to formally review
and approve the actual amount awarded. The metrics were selected to reflect objectives deemed
critical for the stabilization of AIGs businesses and the successful implementation of AIGs
restructuring.
For Mr. Benmosche, the performance metrics were designed to reflect the performance of AIGs
business as a whole, and comprised particular measures related to:
Metric | Achievement | |
Risk management and capital
preservation, consisting specifically of (1)
avoiding negative changes in Standard &
Poors and Moodys ratings or outlook on
AIGs senior unsecured debt and (2)
maintaining and enhancing an appropriate
control environment |
(1) Standard & Poors and Moodys ratings and outlook sustained; and (2) additional control procedures initiated in the third and fourth quarters (including enterprise-wide revalidation of balances, reviews of entities previously out-of-scope and reviews of corporate consolidation process and divestiture accounting) and control environment enhanced through staff additions/changes | |
Reviewing
and revising (1) AIGs
restructuring plan and (2) cost control measures
|
(1) Restructuring plan amended to reflect improving market conditions, new leadership and changes in restructuring strategy; and (2) corporate infrastructure and consulting spending reviewed and master agreements for several key vendors implemented | |
The stabilization of AIGs talent
pool
|
Key senior team positions filled, including: EVP, Finance, Risk and Investments; EVP, Legal Compliance, Regulatory Affairs and Government Affairs & General Counsel; SVP & Director of Internal Audit; SVP, Human Resources and Communications; SVP & Chief Administrative Officer | |
Repayment of debt, including the
closing of the AIA and ALICO SPV
transactions
|
AIA and ALICO SPV transactions closed December 2009 | |
Specific achievements by key
businesses, including improved sales and
customer retention in the life and
retirement services business, improved
customer retention and underwriting in the
Chartis business and continued de-risking of
the AIG Financial Products Corp. portfolio
|
Domestic Life and Retirement
Services: Profitability and pricing improved from 2008 levels: pre-tax
operating income improved each quarter in 2009, returned to
profitability by second quarter; premiums, deposits, and other
considerations stabilized and improved over 2008 levels; surrenders
reduced from 2008 levels
Chartis: as set forth below for Messrs. Moor and Walsh AIG Financial Products Corp.: Significant reductions in risk and financial exposure achieved: trade counts reduced from over 40,000 to approximately 16,900; notional amount of risk reduced from approximately $2.7 trillion to approximately $1 trillion; gross automatic termination event risk reduced from over $20 billion to approximately $5.1 billion; interest rate changes risk, equity market volatility risk, commodity price volatility risk, foreign exchange rate risk, Commodities Index Book risk all reduced |
For Mr. Herzog, performance criteria were generally similar to Mr. Benmosches, because, as
Chief Financial Officer, his responsibilities also extend to the entire company. With respect to
(1) risk management and capital preservation and (2) repayment of debt, Mr. Herzog had the
following additional specific metrics:
Metric | Achievement | |
Risk management and
capital preservation:
Rebalance asset/liability cash
flow profiles to align
maturing debt with free cash
flow from operations and
pursue liquidity generation
measures in a timely and cost
efficient manner
|
Significant progress made in asset monetization at AGF, AIG Risk and Capital Committee established, third party repurchase lines reestablished, and commercial paper borrowing from CPFF reduced | |
Repayment of debt:
Ensure timely repayment of all
maturing subsidiary debt
without recourse to AIG parent
company
|
Maturing debt obligations of AGF met without assistance from AIG, although ILFC required AIG assistance |
For Mr. Moor, who serves as President and Chief Executive Officer of Chartis, AIGs
property-casualty insurance business, performance metrics were based on the performance of the
Chartis business. These metrics were:
Metric | Achievement(1) | |
Increasing return on equity, operating
income, GAAP equity and U.S. statutory surplus
from the prior year period and maintaining a risk
based capital ratio over 400 percent
|
Return on equity improved from 2008 and operating income increased (both excluding significant catastrophes and potential reserve charges relating to prior year development and after taking the preceding into account), GAAP equity increased, U.S. statutory surplus increased, risk based capital ratio maintained over 400 percent | |
Filling
key positions at Chartis and
maintaining staffing levels
|
Key positions for the integration of Chartis domestic and foreign operations filled, and voluntary turnover improved | |
Avoiding the use of capital from AIG
parent
|
Net dividends provided to AIG parent | |
Restoring normal business retention rates
and improving pricing terms
|
Business retention and pricing improved | |
Implementing a new investment strategy to
rebalance the investment portfolios
|
Duration of U.S. asset portfolio reduced | |
Improving the Chartis insurance
companies A.M. Best capital adequacy ratio
score
|
Ratio improved from approximately 125 to approximately 180 |
For Mr. Walsh, performance criteria were identical to those used for Mr. Moor, as Mr. Walshs
responsibilities were primarily linked to Chartis International.
For Mr. Martin, who serves as President and Chief Executive Officer of ALICO, the performance
metrics related to the performance of ALICO. The specific metrics consisted of:
Metric | Achievement | |
Completion of the ALICO SPV
transaction
|
Completed December 2009 | |
Achieving targets for various
solvency ratios, including risk based capital
ratio (over 400 percent), S&P-CAR ratio (over
175 percent) and local solvency ratios
|
All targets achieved | |
Achieving targets for first year
premiums/sales ($1.8 billion) and GAAP
pre-tax operating income ($2.2 billion)
|
First year premiums/sales: $1.6 billion; GAAP pre-tax operating income: $2.1 billion | |
Build and maintain liquidity buffer
|
Achieved | |
Continued progress towards a
potential sale or initial public offering of
the business
|
Achieved, including completion of all due diligence to fully support sale of ALICO |
Mr. Benmosches performance metrics were established immediately before the Special Masters
formal approval of his arrangements on October 2, 2009. The Special Master released the
determination relating to the other members of the Top 25 on October 22, 2009, and the Committee
discussed performance metrics for the current named executives in the Top 25 in early
November. The Special Master released the determination relating to the Top 26-100 on December 11,
2009 and required consultation on the performance metrics. AIG provided proposed metrics to the
Special Master, and the Special Master approved the performance metrics for Messrs. Herzog, Moor,
Martin and Walsh on December 27, 2009. The Committee formally adopted, and reviewed performance
against, the agreed metrics on December 28, 2009. The Committee reviewed performance against Mr.
Benmosches metrics on March 9, 2010. Based on these reviews, the Committee determined that each
of the current named executives had substantially achieved or exceeded his target performance
levels. Based on performance generally at or above target, the Committee decided to award
incentive compensation to the current named executives at the target level.
(1) Evaluated
on basis of nine-month performance or more recent information where
available, in light of timing.
Table of Contents
Item 15. | Exhibits, Financial Statement Schedules |
(b) Exhibits.
The Exhibit Index listed under Part IV, Item 15(b) of AIGs 2009 Annual Report on Form 10-K is
hereby amended such that the following documents are added to the Exhibit Index and are included as
exhibits to the 2009 Annual Report on Form 10-K:
Exhibit | ||||||||
Number | Description | Location | ||||||
31 |
Rule 13a-14(a)/15d-14(a) Certifications | Filed herewith. |
Table of Contents
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this Annual Report on Form 10-K/A (Amendment No. 2) to be
signed on its behalf by the undersigned, thereunto duly authorized, on the 24th day of August, 2010.
AMERICAN INTERNATIONAL GROUP, INC. |
||||
By | /s/ Robert H. Benmosche | |||
(Robert H. Benmosche, President and Chief Executive Officer) | ||||