Document:

EX-10.1

Exhibit 10.1

Release
Of Claims

     1. Release of Claims

     In partial consideration of the payments and benefits described in Section 9 of the employment
agreement effective March 14, 2005, by and between Steven J. Bensinger (“Executive”) and American
International Group, Inc. (the “Company”), as amended by the Letter from the Company to the
Executive dated March 12, 2008 and the Letter Agreement between the Executive and the Company dated
May 8, 2008 (collectively, the “Employment Agreement”), all as set forth in Exhibit A to this
Release and to which Executive agrees Executive is not entitled until and unless he executes this
Release, Executive, for and on behalf of himself and his heirs and assigns, subject to the
following two sentences hereof, hereby waives and releases any employment, compensation or
benefit-related common law, statutory or other complaints, claims, charges or causes of action of
any kind whatsoever, both known and unknown, in law or in equity, which Executive ever had, now has
or may have against the Company and its shareholders (other than C.V. Starr & Co., Inc. and Starr
International Company, Inc.), subsidiaries, successors, assigns, directors, officers, partners,
members, employees or agents (collectively, the “Releasees”) by reason of facts or omissions which
have occurred on or prior to the date that Executive signs this Release, including, without
limitation, any complaint, charge or cause of action arising under federal, state or local laws
pertaining to employment, including the Age Discrimination in Employment Act of 1967 (“ADEA,” a law
which prohibits discrimination on the basis of age), the National Labor Relations Act, the Civil
Rights Act of 1991, the Americans With Disabilities Act of 1990, Title VII of the Civil Rights Act
of 1964, all as amended; and all other federal, state and local laws and regulations. By signing
this Release, Executive acknowledges that he intends to waive and release any rights known or
unknown that he may have against the Releasees under these and any other laws; provided, that
Executive does not waive or release claims with respect to the right to enforce the Employment
Agreement (the “Unreleased Claims”). Notwithstanding the foregoing, Executive does not release,
discharge or waive any rights to indemnification that he may have under the certificate of
incorporation, the bylaws or equivalent governing documents of the Company or its subsidiaries or
affiliates, the laws of the State of Delaware or any other state of which such subsidiary or
affiliate is a domiciliary, or any indemnification agreement between Executive and the Company, or
any rights to insurance coverage under any directors’ and officers’ personal liability insurance or
fiduciary insurance policy.

     2. Proceedings

     Executive acknowledges that he has not filed any complaint, charge, claim or proceeding, except
with respect to an Unreleased Claim, if any, against any of the Releasees before any local, state
or federal agency, court or other body (each individually a “Proceeding”). Executive represents
that he is not aware of any basis on which such a Proceeding could reasonably be instituted.
Executive (i) acknowledges that he will not initiate or cause to be initiated on his behalf any
Proceeding and will not participate in any Proceeding, in each case, except as required by law; and
(ii) waives any right he may have to

 

 

benefit in any manner from any relief (whether monetary or otherwise) arising out of any
Proceeding, including any Proceeding conducted by the Equal Employment Opportunity Commission
(“EEOC”). Further, Executive understands that, by executing this Release, he will be limiting the
availability of certain remedies that he may have against the Company and limiting also his ability
to pursue certain claims against the Releasees. Notwithstanding the above, nothing in Section 1 of
this Release shall prevent Executive from (i) initiating or causing to be initiated on his behalf
any complaint, charge, claim or proceeding against the Company before any local, state or federal
agency, court or other body challenging the validity of the waiver of his claims under the ADEA
contained in Section 1 of this Release (but no other portion of such waiver); or (ii) initiating or participating in an
investigation or proceeding conducted by the EEOC.

     3. Time to Consider

     Executive acknowledges that he has been advised that he has twenty-one (21) days from the date of
receipt of this Release to consider all the provisions of this Release and he does hereby knowingly
and voluntarily waive said given twenty-one (21) day period. EXECUTIVE FURTHER ACKNOWLEDGES THAT HE
HAS READ THIS RELEASE CAREFULLY, HAS BEEN ADVISED BY THE COMPANY TO, AND HAS IN FACT, CONSULTED AN
ATTORNEY, AND FULLY UNDERSTANDS THAT BY SIGNING BELOW HE IS GIVING UP CERTAIN RIGHTS WHICH HE MAY
HAVE TO SUE OR ASSERT A CLAIM AGAINST ANY OF THE RELEASEES, AS DESCRIBED IN SECTION 1 OF THIS
RELEASE AND THE OTHER PROVISIONS HEREOF. EXECUTIVE ACKNOWLEDGES THAT HE HAS NOT BEEN FORCED OR
PRESSURED IN ANY MANNER WHATSOEVER TO SIGN THIS RELEASE, AND EXECUTIVE AGREES TO ALL OF ITS TERMS
VOLUNTARILY.

     4. Revocation

     Executive hereby acknowledges and understands that Executive shall have seven (7) days from the
date of his execution of this Release to revoke this Release (including, without limitation, any
and all claims arising under the ADEA) and that neither the Company nor any other person is obligated to provide any benefits to
Executive pursuant to Section 9 of the Employment Agreement until eight (8) days have passed since
Executive’s signing of this Release without Executive having revoked this Release, in which event
the Company immediately shall arrange and/or pay for any such benefits otherwise attributable to
said eight (8) day period, consistent with the terms of the Employment Agreement. If Executive
revokes this Release, Executive will be deemed not to have accepted the terms of this Release, and
no action will be required of the Company under any section of this Release.

     5. No Admission

     This Release does not constitute an admission of liability or wrongdoing of any kind by Executive
or the Company.

     6. General Provisions

     A failure of any of the Releasees to insist on strict compliance with any provision of this Release
shall not be deemed a waiver of such

 

 

provision or any other provision hereof. If any provision of this Release is determined to be so
broad as to be unenforceable, such provision shall be interpreted to be only so broad as is
enforceable, and in the event that any provision is determined to be entirely unenforceable, such
provision shall be deemed severable, such that all other provisions of this Release shall remain
valid and binding upon Executive and the Releasees.

     7. Governing Law

     The validity, interpretations, construction and performance of this Release shall be governed by
the laws of the State of New York without giving effect to conflict of laws principles.

     IN WITNESS WHEREOF, Executive has hereunto set Executive’s hand as of the day and year set forth
opposite his signature below.

	 	 	 
	 
	 	 	 	 
	 
	 	/s/ Steven J. Bensinger	 	 
	 	 
	 

	 	 	Steven J. Bensinger
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	Date: October 9, 2008

	 	 	 	 	 
	 
	 	 	 	 
		 	 
	 
	 	 	 	 
	Acknowledged and agreed.	 	 
	 
	 	 	 	 
	American International Group, Inc.	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	By:
	 	/s/ Anastasia D. Kelly	 	 
	 
	 	 

	 	 	Anastasia D. Kelly	 	 	 	 
	 	 	Executive Vice President & General Counsel

 

 

    Exhibit A
    

 

    Steven J.
    Bensinger

    Compensation Due Upon Termination
    

 

	 	 	 	 	 	 	 
	
As of October 8, 2008

	

    Value under extended employment agreement and May 8 Letter
    Agreement

	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	

    - Severance payable in equal installments over 12
    months1

	
 
	
 
	
    $7,500,000
	
 
	
 
	
                                                     

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	

    - Pro Rata Bonus based on Target of
    $2 MM2

	
 
	
 
	
    $1,500,000
	
 
	
 
	
 

	
 
	
 
	
 
	
    $9,000,000
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	

    Severance period ends:

	
 
	
 
	
    10/8/2009
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	

    2-year equity vesting
    window4

    ends:

	
 
	
 
	
    10/8/2010
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	

    - RSUs granted Jan 2008

	
 
	
 
	
    $95,120
	
 
	
 
	
    23,780 RSUs scheduled to vest in January 2010 during  the

 2-year
    period following
    termination4

	
 

	
 

	

    - 2005-06 AIG DCPPP

	
 
	
 
	
    $128,000
	
 
	
 
	
    1st and 2nd tranches of 16,000 shares each  scheduled to
    vest in May 2009 & May 2010 during

    2-year period following
    termination4

	
 

	
 

	

    - 2006-07 PP

	
 
	
 
	
    $23,020
	
 
	
 
	
    GEC earnout of 119.9%. 1st tranche of 5,755  shares is scheduled
    to vest in January 2010 during the  2-year period following
    termination4,

    2nd tranche  of 5,755 shares normally vests in January 2012,
    subsequent to the 2-year period following
    termination4

	
 

	
 

	

    - 2007-08 PP

	
 
	
 
	
    $0
	
 
	
 
	
    No earnout projected. Normal vesting dates are January  2011 and
    January 2013, both subsequent to the  2-year period following
    termination4

	
 

	
 

	

    - 2008-09 PP

	
 
	
 
	
    $0
	
 
	
 
	
    No earnout projected. Normal vesting dates are January  2011 and
    January 2012, both subsequent to the  2-year period following
    termination4

	
 

	
 

	

    - 2005 SPP

	
 
	
 
	
    $0
	
 
	
 
	
    Normal vesting date is January 2011, subsequent to the 

2-year
    period following
    termination4

	
 

	
 

	

    - 2004-06 SPP

	
 
	
 
	
    $1,032,813
	
 
	
 
	
    1st tranche of $1,032,813 scheduled to vest during the  2-year
    period following
    termination4

    in January 2010;  2nd tranche normally vests in January 2012,
    subsequent  to the 2-year period following
    termination4

	
 

	
 

	

    - 2005-07 SPP

	
 
	
 
	
    $0
	
 
	
 
	
    Normal vesting dates are in January 2011 and January 2013,
    subsequent to the 2-year period following
    termination4

	
 

	
 

	

    - 2006-08 SPP

	
 
	
 
	
    $0
	
 
	
 
	
    No earnout projected for the 2007-08 PP therefore  there would
    be no earnout for the 2006-08 SPP; normal  vesting dates are
    January 2011 and January 2012,  subsequent to the 2-year period
    following
    termination4

	
 

	
 

	
 
	
 
	
 
	
    $1,278,953

	
 3
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	

    TOTAL:  

	
 
	
 
	

$10,278,9533
	
 
	
 
	
 

 

			
	
    1. 		
    Start of severance payments subject to six-month delay as per
    Section 409A
	
    2. 		
    To be paid October 17, 2008
	
    3. 		
    As an estimate, all equity grants included in the schedule are
    valued at $4 per share
	
    4. 		
    2-year equity & SPP vesting window as defined by the ESP

 

    All options are currently underwater and are not included
    above. 

    However, options continue to vest during the two-year period
    following termination and continue to be exercisable per the
    terms in the award agreement.

    Per the May 8, 2008 Letter Agreement, AIG agrees to
    address and attempt to resolve in good faith
    Mr. Bensinger’s rights under AIG’s Partners Plan,
    AIG’s Senior Partners Plan and the Starr International
    Company, Inc. Plans.

 

    All insurance and other benefits payable will be provided in
    accordance with the terms of the Employment Agreement for
    36 months following the Termination Date.

 

    The terms of all benefits not listed in this Exhibit will be
    determined pursuant to the Employment Agreement and any
    applicable plans.

 

	 	 	 	 	 
	
        

    
Steven
    J. Bensinger
	
 
	
    Date:  October 09, 2008

	
 
	
 
	
 

	
    American International Group, Inc.
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
    By:
	
 
	
        

    
Anastasia
    D. Kelly

    Executive Vice President & General Counsel
	
 
	
    Date:  October 09, 2008EX-10.2

Exhibit
10.2

Mr. Edward M. Liddy

Chairman and Chief Executive Officer

American International Group, Inc.

Dear Ed:

As you know, the Board of Directors of the company decided that my termination was “not for cause.”
Accordingly, I am entitled to receive severance payments under the AIG Executive Severance Plan of
approximately $22 million. While I appreciate the Board’s intention to fulfill this obligation, I
have decided, after careful deliberation, to forgo the severance payments.

I will not accept the severance payments for two reasons. First, my three-month tenure as Chief
Executive Officer did not provide the opportunity to execute the restructuring I had developed with
the help of my AIG colleagues. Second, notwithstanding the issues that predated my term at AIG or
the significant disruption in the capital markets which impacted several major financial
institutions, I prefer not to receive severance payments while shareholders and employees have lost
considerable value in their AIG shares.

I wish you, the Board and all of the talented employees at AIG all the best as you continue the
work of restructuring the company and restoring it to profitability.

Sincerely yours,

/s/ Robert B. Willumstad

Robert B. Willumstad

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