This endorsement changes the policy to which it is attached effective on the inception date of the policy unless a different date is indicated below.

This Endorsement, effective 5/21/1999, forms a part of Policy No. RMGL 612-27-08

Issued to International Business Machines Corporation

By American Home Assurance Company

**DEDUCTIBLE COVERAGE ENDORSEMENT – Form A**

This endorsement modifies insurance provided under the following:

- Commercial General Liability Coverage Form
- Products and Completed Operations Liability Coverage Form
- Liquor Liability Coverage Form
- Professional Liability Coverage Form
- Business Auto Coverage Form
- Garage Coverage Form
- Truckers or Motor Carrier Coverage Form

Please Read It Carefully.

This Endorsement applies solely between you and us. It does not affect the rights of others under this policy.

### I. Payment and Deductible Conditions

A. We will pay all sums that we become obligated to pay up to our Limit of Insurance under the policy to which this endorsement applies. Our Limit of Insurance includes, and shall not apply in addition to, any sum that you must reimburse us for damages, benefits or Medical Payments we have paid.

B. You must reimburse us up to the Deductible Limit(s) shown in the Schedule for any amounts we have so paid as damages, benefits or Medical Payments. The Deductible will apply to each "occurrence," "accident," offense, claim or other basis as shown in the Schedule, regardless of the number of persons or organizations who sustain damages because of an "occurrence" or "accident" or offense or other basis shown in the Schedule.

C. In addition, you must reimburse us for all "Allocated Loss Adjustment Expense" we pay as Supplementary Payments, according to the election indicated by an "X" below. If no election is indicated, election i. applies:

- i. All "Allocated Loss Adjustment Expense" up to the deductible limit. However, the most you must reimburse us for damages, benefits, Medical Payments and "Allocated Loss Adjustment Expense" combined shall not exceed the deductible amount.
- ii. All "Allocated Loss Adjustment Expense"
- iii. A part of "Allocated Loss Adjustment Expense." That part will be calculated by dividing the smaller of the deductible or the damages, benefits or Medical Payments we pay by the damages, benefits or Medical Payments we pay. If we pay no damages, benefits or Medical Payments, you must reimburse us for all "Allocated Loss Adjustment Expense" up to the applicable Deductible amount and 50.0% of all remaining "Allocated Loss Adjustment Expense."
- iv. No "Allocated Loss Adjustment Expense."

Your obligation to reimburse us for "Allocated Loss Adjustment Expense" applies separately to "each occurrence" for bodily injury or property damage, each "accident" for bodily injury or property damage, to each offense for personal injury or advertising injury, to "each claim" for professional liability or employee benefits administration liability, or to each other basis shown in the Schedule.