Martin Sullivan, the recently replaced chief executive officer of American International Group, will receive $47 million in severance, $21 million less than a corporate governance firm estimated a few weeks ago.

Mr. Sullivan on June 15 was replaced by Robert Willumstad, who was already serving as New York-based AIG's chairman. The Corporate Library originally estimated Mr. Sullivan's package would be $68 million.

According to a Securities and Exchange filing yesterday, Mr. Sullivan will receive $15 million in severance pay for 37 years of service to the company; $4 million pro rata bonus; and $28 million in stock and long-term cash rewards.

The company added that the ultimate amount he receives for the current performance period on the stock options "will depend on AIG's actual performance as measured under the respective plan."

He will also be entitled to an office and assistant through the end of this year.

In return, Mr. Sullivan entered into a non-compete agreement for a period of two years and will not solicit AIG clients for four years.

Mr. Sullivan was replaced by Mr. Willumstad following pressure from shareholders and investors after the company posted losses for two consecutive quarters totaling $13 billion.

Meanwhile, Transatlantic Holdings, an international reinsurance company, said Mr. Sullivan resigned as chairman of the board and as a board member. He was replaced by Robert F. Orlich, president and CEO, on an interim basis. A company spokesman said AIG owns 60 percent of Transatlantic shares.

Special Reports /

AIG's Sullivan Severance Set At $47 Million

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