AIG to pay Zaffino $15 million ‘sign-on’ bonusReprints
Former Marsh L.L.C. CEO Peter Zaffino will receive a one-time sign-on bonus worth $15 million in addition to a robust pay package when he joins American International Group Inc., the insurer revealed in a filing with the U.S Securities and Exchange Commission on Thursday.
Initial annual compensation will consist of an annual base salary of $1.25 million — compared with the $1 million salary he received last year at Marsh, according to stock market filings — a short-term annual incentive target of $3 million and an annual long-term incentive award of $4.25 million, according to the filing, which occurred on the heels of Wednesday’s announcement that Mr. Zaffino will be leaving Marsh to join AIG as executive vice president and global chief operating officer.
Mr. Zaffino will also receive “a one-time, sign-on award having a target value of $15 million,” part of which will be options on 1 million shares of AIG stock, according to the filing.
The bonus is “in consideration of compensation foregone from his prior employer,” the filing states. Mr. Zaffino had various stock incentive plans with Marsh’s parent, Marsh & McLennan Cos. Inc.
A cash component will comprise the remainder of the sign-on bonus, of which half will be paid on Feb. 28, 2018, and the rest on Jan. 31, 2019, “subject to Mr. Zaffino’s continued employment through such dates,” according to the filing.
“Mr. Zaffino’s employment with AIG is contingent upon his agreement to fully liquidate any ownership position he holds in MMC and its affiliates as soon as practicable,” the SEC filing states.