EXHIBIT 13(c)
AGREEMENT
BETWEEN
AMERICAN INTERNATIONAL GROUP, INC.
AND
AIG LIFE INSURANCE COMPANY
This Agreement, made and entered into as of December 13, 1991, by and
between American International Group, Inc., a Delaware corporation ("AIG"), and
AIG Life Insurance Company, a Pennsylvania corporation ("AIG Life").
WITNESSETH:
WHEREAS, AIG is the ultimate beneficial owner of 100% of the outstanding
common stock of AIG Life;
WHEREAS, AIG Life has issued and intends to issue insurance policies
including annuity contracts ("policies") to third parties; and
WHEREAS, AIG and AIG Life desire to take certain actions to enhance and
maintain the financial condition of AIG Life as hereinafter set forth in order
to enable AIG Life to issue such policies;
NOW, THEREFORE, in consideration of the mutual promises herein contained,
the parties hereto agree as follows:
1. Stock Ownership. During the term of this Agreement AIG will be the
ultimate beneficial owner of all of the capital stock of AIG Life now or
hereafter issued and outstanding and AIG agrees that it will not pledge, assign
or otherwise encumber such capital stock.
2. Net Worth. AIG agrees that it shall cause AIG Life to have at all times
during the term of this Agreement a policyholders surplus of not less than one
million dollars ($1,000,000) or such greater amount as shall be sufficient to
enable AIG Life to perform the obligations under any policy issued by AIG Life.
3. Liquidity Provision. If during the term of this Agreement AIG Life
needs funds not otherwise available to it to make timely payment of its
obligations under the policies or otherwise, AIG shall provide, at the request
of AIG Life, such funds in cash, either as equity or as a loan at AIG's option,
on a timely basis. If such funds are advanced to AIG Life as a loan, such loan
shall be on such terms and conditions, including maturity and rate of interest,
as AIG and AIG Life shall agree.
4. Waivers. AIG hereby waives any failure or delay on the part of AIG Life
in asserting or enforcing any of its rights or in making any claims or demands
hereunder.
5. Termination; Amendment. Subject to the limitations contained in this
paragraph 5, AIG shall have the absolute right to terminate this Agreement upon
30 days written notice to AIG Life. This Agreement may be amended at any time
by written amendment or agreement signed by both parties subject to the
limitations contained in this paragraph 5. Notwithstanding the amendment to or
the termination of this Agreement, the obligations of AIG under paragraphs 1, 2
and 3 of this Agreement shall continue so long as any policy written prior to
the termination of this Agreement is in force unless all policyholders of such
policies consent in writing to the contrary; provided, however, that AIG shall
have the right without the consent of any such policyholders to terminate this
Agreement in the following circumstances:
a) upon transfer of the entire book of business of AIG Life then
outstanding to an entity with a rating, from Standard & Poor's
Corporation ("S&P") or if S&P shall not make such a rating
available from a substitute agency which is a nationally
recognized statistical rating organization, equivalent to or
better than the rating of AIG Life as supported by this Agreement
at the time of such transfer;
b) upon transfer or sale of AIG Life to an entity with a rating, from
S&P or if S&P shall not make such a rating available from a
substitute agency which is a nationally recognized statistical
rating organization, equivalent to or better than the rating of
AIG Life as supported by this Agreement at the time of such
transfer or sale; or
c) upon the attainment by AIG Life of a rating, from S&P or if S&P
shall not make such a rating available from a substitute agency
which is a nationally recognized statistical rating organization,
without consideration of the support provided by this Agreement,
equivalent to or better than the rating of AIG Life as supported
by this Agreement at such time.
6. Rights of Policyholders. Any policyholder holding a policy issued by
AIG Life prior to the termination of this Agreement shall have the right to
demand that AIG Life enforce AIG Life's rights under paragraphs 1, 2 and 3 of
this Agreement, and, if AIG Life fails or refuses to take timely action to
enforce such rights or if AIG Life defaults in any claim or other payment owed
to any such policyholder when due, such policyholder may proceed directly
against AIG to enforce AIG Life's rights under paragraphs 1, 2 and 3 of this
Agreement.
7. Notices. Any notice, instruction, request, consent, demand or other
communication required or contemplated by this Agreement shall be in writing,
shall be given or made or communicated by United States first class mail,
addressed as follows:
If to AIG: American International Group, Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Treasurer
If to AIG Life: AIG Life Insurance Company
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: President
8. Successors. The covenants, representations, warranties and agreements
herein set forth shall be mutually binding upon and inure to the mutual benefit
of AIG and its successors and AIG Life and its successors.
9. Governing Law. This Agreement shall be governed by the laws of the
State of New York.
(SEAL) AMERICAN INTERNATIONAL GROUP, INC.
Attest: By: /s/
---
/s/
(SEAL) AIG LIFE INSURANCE COMPANY
Attest: By: /s/
---
/s/
AMERICAN INTERNATIONAL GROUP, INC.
00 XXXX XXXXXX, XXX XXXX, X.X. 00000
TELEPHONE: 000 000-0000
November 11, 1993
Xxxxx'x Investors Service, Inc.
00 xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxx
Assistant Vice President - Financial Institutions
Gentlemen:
American International Group, Inc, ("AIG") hereby agrees that notwithstanding
the rights provided under Section 5 of the Agreement between AIG and its wholly
owned subsidiary, AIG Life Insurance Company ("A.I.G. Life"), dated as of
December 13, 1991 (the "Agreement"), AIG will exercise the right to terminate
the Agreement only under the following circumstances:
a) upon transfer of the entire book of business of A.I.G. Life then
outstanding to an entity with a rating, from Xxxxx'x Investors
Service, Inc. ("Xxxxx'x") or if Xxxxx'x shall not make such a rating
available from a substitute agency which is a nationally recognized
statistical rating organization, equivalent to or better than the
rating of A.I.G. Life as supported by the Agreement at the time of
such transfer;
b) upon transfer or sale of A.I.G. Life to an entity with a rating, from
Xxxxx'x or if Xxxxx'x shall not make such a rating available from a
substitute agency which is a nationally recognized statistical rating
organization, equivalent to or better than the rating of A.I.G. Life
as supported by the Agreement at the time of such transfer or sale; or
Xxxxx'x Investors Service, Inc.
November 11, 1993
Page two
c) upon the attainment by A.I.G. Life of a rating, from Xxxxx'x or if
Xxxxx'x shall not make such a rating available from a substitute
agency which is a nationally recognized statistical rating
organization, without consideration of the support provided by the
Agreement, equivalent to or better than the rating of A.I.G. Life as
supported by the Agreement at such time.
AIG further agrees to include a copy of this letter with the Agreement upon any
distribution of the Agreement to third parties.
Very truly yours,
American International Group, Inc.
By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
/s/ Xxxxxxxx X. Xxxxxxx
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Xxxxxxxx X. Xxxxxxx
XXX/mk
