Exhibit 10.1
Services Agreement
          This Services Agreement (“Agreement”) is entered into as of March 20,
2009, by and between Edmund S.W. Tse (“Special Advisor”), American International
Assurance Company, Limited (the “Company”) and, solely with respect to
paragraph 4, American International Group, Inc.

  1.   Purpose of Engagement

  (a)   During the term of this Agreement, Special Advisor will serve as
Honorary Chairman of the Company, providing advisory and other consulting
services.     (b)   Special Advisor will exercise due care, conduct himself with
proper regard to the best interest of the Company and use his best efforts to
promote its interests.

  2.   Term

  (a)   This Agreement will commence on March 24, 2009 and will continue for a
one-year period thereafter, subject to future extensions as may be agreed to in
writing by both parties and subject to early termination as provided in
paragraph 5 (the “Term”).

  3.   Fees         During the Term, the Company will pay Special Advisor an
annual fee of USD $250,000, prorated for any partial years during the Term.
Special Advisor will submit quarterly invoices, and the Company will pay the fee
on a quarterly basis.     4.   Transaction or Completion Bonus         American
International Group, Inc. agrees to pay Special Advisor a reasonable transaction
or completion bonus in an amount to be determined by American International
Group, Inc. in its sole discretion in the event of a sale or IPO of any foreign
life operations (subject, of course, to any restrictions on American
International Group, Inc.’s ability to pay such a bonus). Any such transaction
or completion bonus will survive the termination or expiration of this
Agreement.     5.   Renewal and Termination

  (a)   Special Advisor or the Company may terminate this Agreement and the Term
before its scheduled expiration by giving thirty (30) days’ notice in writing.  
  (b)   The Company may immediately terminate this Agreement and the Term before
its scheduled expiration by written notice to Special Advisor without the notice
required by paragraph (5)(a) if Special Advisor is (i) in

 

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      breach of this Agreement or (ii) absent from his responsibilities under
this Agreement as a result of incapacity due to mental or physical illness or
injury for a period of sixty (60) or more days during any year.     (c)   This
Agreement and the Term will automatically terminate on Special Advisor’s death.
    (d)   Upon termination or expiration of this Agreement and the Term without
renewal, Special Advisor agrees to return all property belonging to the Company
and any of its parents, subsidiaries or affiliates (collectively, “AIG”) and not
to make or retain any copies, duplicates, reproductions or excerpts of AIG’s
materials and not to access, utilize or affect in any manner, any of AIG’s
property, including, without limitation, its electronic communications systems
or any information contained therein.

  6.   Logistics and Expenses

  (a)   During the Term, Special Advisor will be provided with office space
appropriate for his services as Honorary Chairman, administrative support,
transportation services (including a car and driver for business purposes only)
and reimbursement for travel (including first class travel for airfare between
Hong Kong and New York), hotel accommodations and club memberships, as deemed
appropriate by the Company.     (b)   Special Advisor agrees to abide by all of
AIG’s policies and procedures applicable to outside consultants that are related
to the items described under paragraph 6(a) above, and he agrees to purchase all
reimbursable air tickets through a travel agency approved by AIG.

  7.   Non-Competition, Non-Hire

  (a)   Other than for the purpose of AIG’s businesses, Special Advisor will
not, during the Term, do or permit any of the following without the prior
written consent of AIG:

  (i)   Solicit any person who is or has been during the Term a customer of AIG
for the purpose of offering to that person goods or services similar to or
competing with those of the business conducted by the Company during the Term;  
  (ii)   Solicit or entice away, or endeavor to solicit or entice away, any
director or employee of AIG;     (iii)   Cause or permit any person directly or
indirectly under Special Advisor’s control to do any of the acts or things
specified above;

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  (iv)   Be employed by an organization that provides goods or services similar
to or that competes with the business conducted by the Company during the Term;
and     (v)   Act as director, advisor or consultant or any other similar role
in an organization that provides goods or services similar to that competes with
the business conducted by the Company during the Term (this obligation shall not
prevent Special Advisor from serving as an outside director as appointed by
AIG).     The parties acknowledge and agree that the terms of this Agreement,
including this paragraph 7, do not prevent Special Advisor from providing
services to other entities (including non-AIG entities) that do not provide
goods and services similar to, and that do not compete with, the business
conducted by the Company.

  (b)   Ownership of not more than 1% of the outstanding stock of any publicly
traded company will not be a violation of this paragraph.     (c)   In addition
to any other rights the Company may have, including those under paragraphs 5 and
12(e), which are expressly retained, if Special Advisor violates any provision
of this paragraph 7, the Company may declare any prior payments made to Special
Advisor under paragraph 3 of this Agreement void. Special Advisor agrees that,
under such circumstances, he will promptly return all prior payments made to him
under paragraph 3 of this Agreement.     (d)   Each undertaking in
paragraph 7(a) will be treated as independent of the other undertakings so that,
if one or more is held to be invalid as an unreasonable restraint of trade or
for any other reason, the remaining undertakings will be valid to the extent
that they are not affected.     (e)   While the undertakings in paragraph 7(a)
are considered by the parties to be reasonable in all the circumstances, if one
or more is held invalid as an unreasonable restraint of trade or for any other
reason but would have been held valid if part of the wording had been deleted,
the period reduced or the range of activities or area dealt with reduced in
scope, the undertakings will apply with such modifications as may be necessary
to make them valid.

  8.   Representations and Warranties         Special Advisor represents and
warrants that in his capacity as Honorary Chairman he will:

  (a)   Devote the necessary and appropriate amount of time, attention and skill
to the performance of his duties;

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  (b)   Conduct himself with proper regard to the best interest of the Company
and use his best efforts to promote its interests;     (c)   Always abide by all
of AIG’s rules and procedures applicable to AIG’s outside consultants;     (d)  
Obey AIG’s Code of Conduct (“Code”) as it applies to outside consultants, as
attached in Exhibit 1 to this Agreement and which Code is made a part of this
Agreement;     (e)   Not disparage AIG, its officers or employees during or
after his service as Honorary Chairman; and     (f)   Maintain the confidential
nature of all records and information (including electronic data) of AIG and not
discuss those records or information except as required in the performance of
Special Advisor’s authorized duties.

  9.   Confidentiality

  (a)   Except as reasonably required in the performance of Special Advisor’s
authorized duties, Special Advisor covenants that he will not at any time during
the Term or at any time thereafter disclose to any person or otherwise make use
of any of the Confidential Information which has been collected by him or made
known to him by virtue of his services under this Agreement. Special Advisor
further covenants to take all reasonable steps to prevent unauthorized use or
disclosure of any Confidential Information.     (b)   The foregoing provision
does not apply to:

  (i)   Information that by means other than Special Advisor’s deliberate or
inadvertent disclosure becomes well known or readily ascertainable by the
public; or     (ii)   Disclosures compelled by judicial or administrative
proceedings following Special Advisor’s diligent challenge to such disclosure
and after having afforded AIG the opportunity to participate in such proceeding.

  (c)   All notes, data of every kind (including electronic data), information
and/or memoranda of any nature and in particular the Confidential Information
which will be acquired, received or made by Special Advisor during the Term will
be the property of the Company and will be surrendered by him to the Company
upon the termination of this Agreement and the Term or at the request of the
Company at any time during the Term or any time thereafter.

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  (d)   Special Advisor acknowledges that this condition may not be altered nor
its obligations excused except by a written document signed by a corporate
officer of the Company.     (e)   The obligations contained in this paragraph 9
will endure, even after the termination of this Agreement and the Term, except
and until any Confidential Information enters the public domain as set out
above.     (f)   For purposes of this Agreement, “Confidential Information”
means information which is not publicly known relating to the business affairs,
proprietary products, technology, research, development and trade secrets of AIG
and other legal entities with which AIG deals in commercial transactions.

  10.   Independent Contractor         Special Advisor agrees that he is
performing his services under this Agreement as an independent contractor and
not as an employee of the Company or any of its parents, subsidiaries or
affiliates. Special Advisor will be responsible for all taxes and other
non-reimbursable expenses attributable to the rendition of these services and he
will indemnify, hold harmless and defend the Company and their parents,
subsidiaries and affiliates and their incumbent or former officers, directors,
consultants, employees, successors and assigns, from any and all claims,
liabilities, damages, taxes, fines or penalties sought or recovered by any
governmental entity, including, but not limited to, any federal, state, local or
foreign taxing authority, arising out of Special Advisor’s alleged failure to
pay federal, state, local or foreign taxes during the Term or in respect of
amounts paid during the Term. Nothing in this Agreement will be deemed to
constitute a partnership or joint venture between Special Advisor and any member
of AIG, nor will anything in this Agreement be deemed to constitute any member
of AIG or Special Advisor as the agent of the other. Except pursuant to this
Agreement, neither Special Advisor nor any member of AIG will be or become
liable to or bound by any representation, act or omission whatsoever of the
other.     11.   Release of Claims; Acknowledgment

  (a)   Special Advisor agrees to waive and release American International
Group, Inc., the Company, their parents, subsidiaries and affiliates and their
officers, directors, and employees from any and all rights and claims under
United States and Hong Kong law and the laws of all other relevant jurisdictions
to the greatest extent permitted by applicable law, except any rights relating
to obligations under this Agreement and as set forth in the two schedules
provided to him in connection with his retirement (the “Schedules”). Special
Advisor acknowledges that he is not owed any amounts from AIG except as set
forth in this Agreement and in the Schedules. Payment of any sum referred to in
the Schedules shall be made

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      only upon receipt of required regulatory approvals and in accordance with
the conditions thereof.     (b)   Special Advisor agrees to execute any
documentation that AIG may reasonably request to give effect to this paragraph.

  12.   Miscellaneous

  (a)   Neither party may assign, transfer or subcontract this Agreement or any
of its obligations hereunder without the other party’s express, prior written
consent. Notwithstanding the foregoing, the Company may assign this Agreement to
an entity under AIG’s operation, management or control or to a purchaser of or
successor to the assets of any entity or business line to which Special Advisor
is to provide services under this Agreement.     (b)   Special Advisor agrees
that he will not issue any press release or public statement of any kind, or
publicize this Agreement or the business relationship between the parties
without the prior review and approval of AIG, except as required by applicable
law upon notice to AIG.     (c)   This Agreement will be governed by the law
applicable in Hong Kong and the parties irrevocably and unconditionally submit
to the non-exclusive jurisdiction of the courts of Hong Kong.     (d)   Special
Advisor acknowledges that the services he is to provide under this Agreement are
of a specific, unique and extraordinary character and that his breach or
threatened breach of the “Non-Competition, Non-Hire” provisions set forth in
paragraph 7 or the “Confidentiality” provisions set forth in paragraph 9 would
cause irreparable injury to the Company, its parents, subsidiaries and
affiliates for which monetary damages alone will not provide an adequate remedy.
Accordingly, in addition to any rights or remedies the Company may have
available to it under this Agreement or otherwise, it also will be entitled to
an injunction to be issued by any court of competent jurisdiction, restraining
Special Advisor from committing or continuing any violation of this Agreement.
Special Advisor agrees that no bond will need to be posted for the Company to
receive such an injunction, and no proof will be required that monetary damages
for violations of the non-competition provisions would be difficult to calculate
and that remedies at law would be inadequate. The provisions of paragraph 9 of
this Agreement will survive the termination of this Agreement.     (e)   This
Agreement constitutes the entire agreement of the parties hereto and supersedes
all prior and contemporaneous representations, proposals, discussions and
communications, whether oral or in writing. This Agreement may be modified only
in a writing signed by Special Advisor and the Company; with respect to
paragraph 4, this Agreement can only be

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      amended in a writing signed by Special Advisor, the Company and American
International Group, Inc. This Agreement may be executed in any number of
counterparts and such counterparts may be obtained by facsimile transmission,
each of which taken together will constitute one and the same instrument.    
(f)   Any notices given under this Agreement (i) by the Company to Special
Advisor will be in writing and will be given by hand delivery or by registered
or certified mail, return receipt requested, postage prepaid, addressed to or
(ii) by Special Advisor to the Company will be in writing and will be given by
hand delivery or by registered or certified mail, return receipt requested,
postage prepaid, addressed to American International Assurance Company, Limited,
care of General Counsel, American International Group, Inc., 70 Pine Street, New
York, New York 10270.

         
 
        Accepted and Agreed:    
 
        /s/ Edmund S.W.
Tse                                                March 20, 2009          
Edmund S.W. Tse                                      
                              Date    
 
        American International Assurance Company, Limited    
 
       
By:
  /s/ Mark Wilson                                               March 20, 2009
 
Name: Mark Wilson                                                         Date  
 
 
  Title: President AIA    
 
        Accepted and Agreed Solely With Respect To Paragraph 4:    
 
        American International Group, Inc.    
 
       
By:
  /s/ Anastasia D. Kelly                                       March 26, 2009
 
Name: Anastasia D. Kelly                                                Date    
 
  Title: Vice Chairman    

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Exhibit 1
American International Group, Inc.
Code of Conduct
[Available at AIG’s corporate website, http://www.aigcorporate.com]

 

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March 24, 2009
Mr. Edmund S.W. Tse

Dear Edmund:
Following our conversation on Friday, we have mutually confirmed that the date
of your retirement from American International Group, Inc. (“AIG”) and its Board
of Directors will be the date of our 2009 Annual Meeting of Shareholders.
I am heartened that even after your retirement, we will continue to benefit from
your deep expertise and knowledge of our Asian operations as we continue to
execute our restructuring and divestiture program during difficult times. To
coordinate your ongoing contributions to AIG, we will hereby amend the Services
Agreement, dated as of March 20, 2009, between you, American International
Assurance Company, Limited and AIG, to provide that the “Term” of that Agreement
will instead begin on the date of our 2009 Annual Meeting of Shareholders. In
addition, please find attached the final schedules referred to in the Services
Agreement, reflecting your retirement date, updated estimates of your benefits
and the final amounts of your plan awards.
I thank you again for your decades of dedicated service to AIG.
Sincerely,

     
/s/ Edward M. Liddy
   
 
   
Accepted and agreed:
     
/s/ Edmund S.W. Tse
   
 
Edmund S.W. Tse
   
 
   
/s/ Mark Wilson
   
 
American International Assurance Company, Limited
   
By: Mark Wilson, President
   

 

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SCHEDULE 1
Edmund S. W. Tse — Retirement Benefits Summary
Hong Kong Staff Provident Fund
Mr. Tse participates in the Hong Kong Provident Fund. The Fund includes
contributions from both AIG and Mr. Tse. Amounts contributed each year, and
earnings thereon, are distributed in a lump sum payment upon a participant’s
retirement after reaching age 65. Mr. Tse is currently age 71 and eligible for a
lump sum distribution at retirement.
Mr. Tse’s updated December 31, 2008 Provident Fund Account balance for his
Company and Employee contribution amounts are summarized below:

         
Company
  HK$ 35,253,451.28  
Employee
  HK$ 6.427,972.38    
Total Account
  HK$ 41,681,423.66  

For a retirement date effective May 13, 2009 the total lump sum amount will be
subject to market fluctuations and additional contributions made between
January 1, 2009 and May 13, 2009.
Supplemental Executive Retirement Plan
Mr. Tse is a participant in the Supplemental Executive Retirement Plan (SERP).
The retirement benefit from the SERP is payable at retirement in the form of an
annuity. The SERP formula, based upon Mr. Tse’s age and length of service, would
provide a lifetime annuity based upon 60% of Final Average Base Pay earned in
the 36 months prior to retirement, reduced by the annuity equivalent of the lump
sum payment Mr. Tse will receive from the Company portion of his Provident Fund
account. The lump sum in the Provident Plan is converted to an equivalent
annuity using the conversion factors in our qualified pension plan.
Mr. Tse’s SERP benefit estimate (using base pay through May 13, 2009 and his
December 31, 2008 Provident Fund account balance) with service projected to
May 2009 is provided below.

         
SERP Annual Annuity:
  $ 540,609  
Less Provident Fund Annuity Equivalent:
    (453,311) *
 
     
* (FX rate @ 0.129057 as of 3/23/09)
       
SERP Annual Retirement Benefit:
  $ 87,298 *

 

*   This SERP benefit is payable as a lifetime annuity for Mr. Tse’s lifetime
only. The annual amount is paid monthly effective the first of the month after
Mr. Tse’s retirement effective date. The SERP also offers other payment options
which result in a reduction to this amount to provide a survivor annuity benefit
or to provide payments on a guaranteed basis for 10 years. The actual SERP
benefit will be calculated using the actual market values in the Provident fund
as of May 13, 2009 and will not commence until after the actual fund performance
results through that date are officially finalized.

 

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SCHEDULE 1 (cont’d)
Edmund S. W. Tse — Retirement Benefit Summary
Corporate Officer Group Life Insurance Benefit
Mr. Tse’s retiree life insurance benefit is based upon 36 times his basic
monthly salary with a cap at HK$3,000,000.
The amount of insurance in retirement is subject to reduction based upon the
following schedule:

      Year After Retirement   Percentage of Amount of Insurance
First
  100% 2nd year after year   50%

Comprehensive Major Medical Plan of the Legency Plan for Retired Employee
Provides comprehensive retiree medical coverage for the retiree and his spouse.
For 2009 retirements, there is an annual premium contribution of USD $900 for
retired employees and USD $900 for spouse coverage. The required contribution is
paid on a monthly basis of USD $150 for retiree and spouse coverage.

 

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SCHEDULE 2
Edmund Tse

Shares and Cash Due Upon Retirement

                      Plan   Grant     Earned Shares     Earned Cash
Time-vested RSUs
  Dec 2007       22,404      
AIG DCPPP
    2005-2006       76,800      
AIG Partners Plan
    2006-2007       23,020      
AIG Senior Partners Plan
    2005             $  3,850,000
 
  Jan 2004 - Dec 2006             $  5,783,750
 
  Jan 2005 - Dec 2007             $  4,754,750
TOTAL EARNED SHARES OR CASH PAYABLE
            122,224     $14,388,500