On November 18, 2008, based on the recommendation of the Compensation Committee, the Board of Directors (the "Board") of American Eagle Outfitters, Inc. (the "Company") approved the following changes in its compensation structure for non-employee directors beginning January 1, 2009:

• automatic quarterly stock grants for non-employee directors of a number of shares equal in value to $30,000, based on the value of the Company's stock on the first day of each calendar quarter, to be issued under the Company's 2005 Stock Award and Incentive Plan.  These quarterly stock grants replace all previously approved automatic stock grants to non-employee directors;
• an annual retainer for serving as the Chairman of the Audit Committee of $25,000, payable quarterly;
• an annual retainer for serving as the Lead Independent Director of $20,000, payable quarterly;
• a fee for serving on a Special Committee of the Board of $1,500 per in-person meeting and $1,000 per telephonic meeting; and
• a fee for serving as the Chairman of a Special Committee, in addition to the fee for serving on the committee, of $1,500 per in-person meeting and $1,000 per telephonic meeting.