# PUNITIVE DAMAGES – MOST FAVORABLE JURISDICTION LIMITATION ENDORSEMENT

| Named Insured | International Business Machines Corporation |
|---------------|-------------------------------------------|
| Policy Symbol | XOO                                        |
| Policy Number | G2763848A                                 |
| Policy Period | 05/21/2015 to 05/21/2016                  |
| Endorsement Number | 30                                         |
| Effective Date of Endorsement | 05/21/2015                                |
| Issued By (Name of Insurance Company) | ACE Property and Casualty Insurance Company |

**THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.**

This endorsement modifies insurance provided under the following:

**COMMERCIAL UMBRELLA LIABILITY POLICY**

The following **CONDITION** is added to the policy:

### Punitive Damages

1. "Punitive damages" because of "bodily injury", "property damage" or "personal and advertising injury" will be considered damages to which this insurance applies, but only if:
   a. The "punitive damages" are awarded by a court of law in a judgment against the "insured"; and
   b. The same judgment also awards compensatory damages against the "insured" that (1) arise out of the same "occurrence" and (2) are otherwise covered by this insurance; and
   c. Such award of "punitive damages" is permitted to be covered by insurance under the law of a U.S. jurisdiction that has a "substantial relationship" to the "insured", us, or this policy.
   
   If all three of conditions a., b., and c. above are satisfied, we will follow the law of such jurisdiction that is most favorable to the "insured" in determining whether such "punitive damages" are insurable, and if they are insurable under the law of such jurisdiction, we will pay on behalf of the "insured" those sums in excess of the "retained limit" that "insured" is liable to pay as a result of the award, subject to the limitations in sections (2), through (5) below, the limits of insurance and all other terms and conditions of the policy. No choice of law issue which may arise out of a claim or "suit", other than the insurability of "punitive damages", shall be affected by this endorsement.

2. "Punitive damages" will not be considered damages to which this insurance applies, and we will have no obligation with respect to such damages, if:
   a. The "insured" seeking coverage for an award of "punitive damages", brings a "suit" against us seeking a declaration of coverage under the policy in a jurisdiction that does not recognize or permit the insurability of the "punitive damages" award; or
   b. The court that enters the judgment awarding "punitive damages" against the "insured" also orders that the "insured" may not seek insurance coverage for "punitive damages".

XS-27989a (01/12)
© 2012
Page 1 of 2