Word: greenberg
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...Wells told the court that Greenberg in the past has acknowledged in AIG financial filings, speeches and other documents that the stock was meant to be used to benefit employees. "You stated to the participants that the stock was being preserved for future AIG employees," Wells said to Greenberg. "Was it just a coincidence that you said that again and again?" Wells pointed to a "Statement of Commitment" that Greenberg and other Starr directors signed in 1992 pledging that Starr would maintain its investment in AIG despite "unforeseeable" changes in the future...
...most heated part of the testimony came when Wells asked Greenberg whether losing his job justified breaking that oath, implying that he had done so as revenge for his dismissal from AIG after serving as its chief executive for 38 years. "The fact that you lost your job was a big enough act to cause you to breach your fiduciary responsibility?" asked Wells...
...That [selling the AIG stock] was not a breach of our fiduciary responsibility," Greenberg replied. He maintained that Starr - which was long operated as if it were a private subsidiary of AIG - is an independent company with the right to end the compensation plan as well as the right to sell its shares...
...Until 2005, Greenberg was the head of both AIG and Starr, which was one of a number of companies that were the predecessors to the modern AIG. When AIG was formed in the late 1960s and taken public, Starr was given hundreds of millions of shares of the new company. Controlled by AIG executives, Starr was given the shares as a defense against hostile takeovers of the insurance giant. Five years later, Starr set up the disputed long-term compensation plan that for many years rewarded AIG executives from Starr's trove of company stock when the insurer's profits...
...When Greenberg left AIG in 2005, he took control of Starr and its AIG shares, which at the time totaled 300 million. Starr has since pocketed $4.3 billion from the sale of some of those shares. AIG says those profits belong to the insurance giant, along with the remaining 180 million shares of AIG that Starr still holds, which are worth just over $270 million...