Exhibit 10(2)






 






	
   

  

  	
   

  
	
   

  Jeffrey J. Hurd

  Executive Vice President

  Human Resources &

  Communications 

   

  180 Maiden Lane,
  41st Fl

  New York,
   NY 10038

  T  212 770-7292

  F  212 770-9817

  Jeffrey.Hurd@aig.com

   

   

  	
  August
  14, 2013

  Mr.
  Kevin Hogan

  Rebbergstrassse
  12

  Rueschlikon
  8803

  Switzerland

   

  Dear
  Kevin,

   

  We
  are pleased to confirm the terms of your joining American International
  Group, Inc. (“AIG”): 

   

  ·        
  Start Date.  Your start date
  will October 14, 2013.

  ·        
  Position.  On your Start
  Date, you will serve as Chief Executive Officer, Global Consumer Insurance,
  AIG Property Casualty, and as an Executive Vice President of AIG.  In this
  capacity, you will be a member of the AIG Executive Group and report directly
  to the Chief Executive Officer of AIG Property Casualty, Peter Hancock.

  ·        
  Location & Employer.  You
  will be based in Zurich, Switzerland and employed directly by AIG Europe
  Limited, London, Zurich Branch (your “Employer”). 

  ·        
  Total Direct Compensation. 
  Your initial annual target direct compensation will be US$5,500,000, as
  follows:

  ·        
  Base Salary.  Your initial base
  cash salary will be at a rate of US$900,000 per year.

  ·        
  Short Term Incentive. 
  Your initial annual incentive target will be US$1,600,000. 

  Annual incentives are currently
  determined and paid in accordance with the AIG Short-Term Incentive Plan. 
  The actual amount earned ranges from 0% to 187.5% of your target award, based
  on a combination of funding of the incentive pool for your business unit
  (ranging from 0% to 125%) and your individual performance (ranging from 0% to
  150%), each as determined in AIG’s discretion.  For 2013, provided you are
  still an employee of AIG on the date the incentive award is paid, your earned
  incentive award for 2013 will be

  






 






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  no less than target (and will not be
  prorated), will vest immediately upon grant and will be payable 50% in March
  2014 and 50% in March 2015.

  ·        
  Long Term Incentive. 
  For 2013, you will receive an award under the AIG 2013 Long Term Incentive
  Plan of performance share units (“PSUs”) based on a 2013 LTI target
  award of US$3,000,000 for the three-year performance period covering January
  2013 through December 2015.

  The number of PSUs granted will be
  determined by dividing the approved LTI target award by the monthly average
  closing price of a share of AIG Common Stock for June.  Following the
  performance period, in the first quarter of 2016, the number of PSUs earned
  (from 0% to 150%) will be determined in accordance with the plan.  Earned
  PSUs will vest in three equal installments, on January 1 of each 2016, 2017
  and 2018, and each installment will be delivered in shares of AIG Common
  Stock no later than April 2016, January 2017 and January 2018, respectively. 

  ·        
  Introductory Bonus. 
  In consideration of compensation foregone from your current employer, you
  will receive an introductory bonus of US$3,250,000, payable US$1,300,000 on
  April 15, 2014; US$1,150,000 on April 15 2015; and US$800,000 on April 15,
  2016, provided you have not resigned your employment (other than for Good
  Reason as defined below) or been terminated by AIG for Cause (as defined in
  the enclosed Introductory Bonus Agreement) prior to the payment date and
  subject to the terms and conditions of the enclosed Introductory Bonus
  Agreement.  

  ·        
  Benefits.  You will be
  entitled to benefits consistent with senior executives of AIG and
  reimbursement of reasonable business expenses, in each case in accordance
  with applicable AIG policies as in effect from time to time.  In particular,
  (1) while based in Switzerland, you will receive medical, dental, retirement
  and other benefits equivalent to those under our International Assignment
  Payroll, Personnel and Benefit Practices and in accordance with the terms and
  conditions of the governing plan documents, (2) if during this period you
  spend a significant amount of business time in a location other than Zurich,
  you will be provided a suitable apartment in that location and (3) for 2013,
  you will be able to use 10 days of paid time off and, for 2014, you will be
  able to use 30 days of paid time off (accruing in accordance with the terms
  set forth in the Employee Handbook).  In addition, your Employer will
  reimburse you for up to US$20,000 in legal fees incurred in the review of
  your employment arrangement.

  






 






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  ·        
  Executive Severance Plan. 
  Beginning as of your Start Date, you will participate in AIG’s Executive
  Severance Plan at grade level 29.

  ·        
  Clawback Policy.  Any bonus,
  equity or equity-based award or other incentive compensation granted to you
  will be subject to the AIG Clawback Policy (and any other AIG clawback
  policies as may be in effect from time to time).

  ·        
  Indemnification and Cooperation. 
  During and after your employment, AIG will indemnify you in your capacity as
  a director, officer, employee or agent of AIG to the fullest extent permitted
  by applicable law and AIG’s charter and by-laws, and will provide you with
  director and officer liability insurance coverage (including
  post-termination/post-director service tail coverage) on the same basis as
  AIG’s other executive officers.  AIG agrees to cause any successor to all or
  substantially all of the business or assets (or both) of AIG to assume
  expressly in writing and to agree to perform all of the obligations of AIG in
  this paragraph.

  You
  agree (whether during or after your employment with AIG) to reasonably
  cooperate with AIG in connection with any litigation or regulatory matter or
  with any government authority on any matter, in each case, pertaining to AIG
  and with respect to which you may have relevant knowledge, provided that, in
  connection with such cooperation, AIG will reimburse your reasonable expenses
  and you shall not be required to act against your own legal interests.  

  ·        
  Tax Matters.  Tax will be
  withheld by your Employer and/or AIG as appropriate under applicable tax
  requirements for any payments or deliveries under this letter.  To the extent
  any taxable expense reimbursement or in-kind benefits under this letter is
  subject to Section 409A of the U.S. Internal Revenue Code of 1986, the amount
  thereof eligible in one taxable year shall not affect the amount eligible for
  any other taxable year, in no event shall any expenses be reimbursed after
  the last day of the taxable year following the taxable year in which you
  incurred such expenses and in no event shall any right to reimbursement or
  receipt of in-kind benefits be subject to liquidation or exchange for another
  benefit.  Each payment under this letter will be treated as a separate
  payment for purposes of Section 409A.

  ·        
  No Guarantee of Employment or Target Direct
  Compensation.  This offer letter is not a guarantee
  of employment or target direct compensation for a fixed term.  Your
  employment will be on an “at-will” basis, meaning that you and your Employer
  may terminate your employment at any time and for any reason, with or without
  prior notice. 

  






 






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  ·        
  Entire Agreement.  This
  offer letter constitutes AIG and your Employer’s only statement relating to
  its offer of employment to you and supersedes any previous communications or
  representations, oral or written, from or on behalf of AIG or any of its
  affiliates.  

  ·        
  Miscellaneous Representations.  You
  confirm and represent to AIG, by signing this letter, that: (a) you are under
  no obligation or arrangement (including any restrictive covenants with any
  prior employer or any other entity) that would prevent you from becoming an
  employee of AIG or that would adversely impact your ability to perform the
  expected services on behalf of AIG other than as previously disclosed in
  writing to AIG; (b) you have not taken (or failed to return) any confidential
  information belonging to your prior employer or any other entity, and, to the
  extent you remain in possession of any such information, you will never use
  or disclose such information to AIG or any of its employees, agents or
  affiliates; (c) you understand and accept all of the terms and conditions of
  this offer; and (d) you acknowledge that your Employer is an intended third
  party beneficiary of this offer letter.

  ·        
  Non-solicitation.  This
  offer and your employment with your Employer are contingent on your entering
  into the enclosed Non-Solicitation and Non-Disclosure Agreement.

  ·        
  Good Reason. For purposes
  of this offer letter as it relates to the Introductory Bonus only, “Good
  Reason” means (a) a diminution of duties or responsibilities such that they
  are inconsistent in any material and adverse respect with your then title or
  offices;  (b) a diminution in title or office that is material and adverse to
  your authority; (c) a material reduction in base salary; (d) a material
  reduction in your annual total direct compensation opportunity; or (e)
  requiring you to be based in any location other than Zurich, Switzerland or
  New York, New York.
  

  






 









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  We
  look forward to having you as a member of AIG’s leadership team.

  Sincerely,
  

   

  American International Group, Inc.

   

  By: /s/ Jeffrey J. Hurd

        Jeffrey J. Hurd

      Executive Vice President – 

      Human Resources and Communications

   

  I
  agree with and accept the foregoing terms.

  

  

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Kevin Hogan

  
	
   

  	
  Kevin
  Hogan

  






 








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