- Current report filing (8-K)
November 17 2009 - 7:56AM
Edgar (US Regulatory)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
Date of report (Date of earliest event
reported):
November 13, 2009
Aon
Corporation
(Exact Name of Registrant as Specified in
Charter)
Delaware
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1-7933
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36-3051915
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(State or Other
Jurisdiction
of Incorporation)
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(Commission File
Number)
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(IRS Employer
Identification No.)
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200
East Randolph Street, Chicago, Illinois
(Address of Principal
Executive Offices)
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60601
(Zip Code)
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Registrants telephone number, including
area code:
(312) 381-1000
Not
Applicable
(Former Name or Former Address, if
Changed Since Last Report)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (
see
General
Instruction A.2. below):
o
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item 5.02. Departure of Directors or Certain Officers; Election
of Directors; Appointment of Certain Officers; Compensatory Arrangements of
Certain Officers.
(e)
On November 13, 2009, Aon
Corporation (the Company) entered into an amended and restated employment
agreement (the Employment Agreement) with Gregory C. Case, its President and
Chief Executive Officer, which modifies the existing employment agreement dated
as of April 4, 2005 between the Company and Mr. Case (the Prior Agreement). The terms of the Prior Agreement were
disclosed in a Current Report on Form 8-K filed with the Securities and
Exchange Commission (the SEC) on April 5, 2005. The principal modifications set forth in the
Employment Agreement are described below:
Term
.
The Employment Agreement commenced November 13, 2009, and will expire April
3, 2015, unless terminated earlier. The
term of Mr. Cases employment was thereby extended five years.
Salary
and Bonus
. No changes were made to Mr. Cases current
annual base salary of $1,500,000. Mr. Case
is eligible for a target bonus of 200% (an increase from 150%) of base salary
and a maximum bonus of 300% of the target bonus (an increase from 250% of base
salary), subject to the current cap of $5 million established under the Companys
Senior Officer Incentive Compensation Plan.
The Companys board of directors retains the discretion to determine Mr.
Cases actual bonus payment.
Long-Term
Incentive Compensation.
The Employment
Agreement no longer requires an annual award of $1.8 million in non-qualified
stock options be granted by the Company to Mr. Case, a contractual requirement under
the Prior Agreement that Mr. Case has annually waived. Mr. Case will continue to be eligible to
participate in the Companys long-term incentive compensation plans, such as
its Leadership Performance Program (LPP), a sub-plan of the 2001 Aon Stock
Incentive Plan. As a reflection of Mr. Cases exceptional performance to date
and his commitment to the extended term as set forth in the Employment
Agreement, he will receive an additional award valued at $10 million under the
LPP for the performance period beginning January 1, 2010 and ending December 31,
2012. This additional award will be
earned based on the same performance criteria and weightings as the regular
award the Company anticipates awarding to Mr. Case under the LPP for the same
performance period. The performance
criteria and weightings will be the same as those applicable to other LPP award
recipients.
Benefits.
No changes were made to Mr. Cases eligibility for life insurance
coverage of at least $5 million. Mr. Case
will be eligible to participate in the Companys other employee benefit
programs on the same basis as provided currently under the Prior Agreement;
however, he and his family will be eligible for coverage under the Companys
retiree medical program if his employment terminates for any reason other than
cause after he has attained age 50 and irrespective of his years of employment
with the Company.
Noncompetition.
The Employment Agreement modified the two-year
noncompetition provision to prohibit Mr. Cases employment with an insurance
brokerage, reinsurance brokerage or employee benefits brokerage business if
such services represent at least 55% of such business annual gross revenue,
subject to additional restrictions.
Other restrictive covenants set forth in the Employment Agreement
continue unchanged from those set forth in the Prior Agreement.
Termination
Provisions
.
The Employment Agreement contains no material
changes to the termination provisions applicable to Mr. Cases employment as set
forth in the Prior Agreement.
In addition, on November 13,
2009, the Company entered into an amended and restated change in control
agreement (the Change in Control Agreement) with Mr. Case, which modifies the
existing severance agreement dated as of April 4, 2005 between the Company and Mr.
Case (the Prior Change in Control Agreement).
The terms of the Prior Change in Control Agreement were disclosed in a
Current Report on Form 8-K filed with the SEC on April 5, 2005. The Change in Control Agreement significantly
reduces the financial protection to be afforded to Mr. Case in the event of the
termination of his employment in connection with a change in control of the
Company. The principal modifications are:
2
(1)
Complete elimination of the Companys
obligation to provide a gross-up payment to Mr. Case in connection with excise
taxes imposed by Section 4999 of the Internal Revenue Code of 1986, as amended
(the Code); and
(2)
Capping Mr. Cases cash and non-equity
award payments to the safe harbor amount under Code Section 280G, such that
the cash and non-equity award payments are not deemed to be excess parachute
payments.
The foregoing summaries
are qualified in their entirety by reference to each of the Employment
Agreement and the Change in Control Agreement, copies of which are attached
hereto as Exhibits 10.1 and 10.2, respectively, and incorporated herein by
reference.
A copy of the press
release announcing the extension of Mr. Cases employment agreement is filed
with this report as Exhibit 99.1.
3
Item 9.01. Financial Statements and Exhibits.
(a)(c) Not applicable.
(d) Exhibits:
Exhibit
Number
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Description of Exhibit
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10.1
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Amended and Restated
Employment Agreement dated as of November 13, 2009, between Aon Corporation
and Gregory C. Case.
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10.2
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Amended and Restated
Change in Control Agreement entered into as of November 13, 2009 between Aon
Corporation and Gregory C. Case.
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99.1
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Press Release issued by
Aon Corporation on November 16, 2009.
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4
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
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Aon
CORPORATION
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By:
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/s/ Peter Lieb
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Peter Lieb
Executive Vice President and General
Counsel
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Date: November 16, 2009
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5
EXHIBIT INDEX
Exhibit
Number
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Description of Exhibit
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10.1
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Amended and Restated
Employment Agreement dated as of November 13, 2009, between Aon Corporation
and Gregory C. Case.
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10.2
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Amended and Restated
Change in Control Agreement entered into as of November 13, 2009 between Aon
Corporation and Gregory C. Case.
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99.1
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Press Release issued by
Aon Corporation on November 16, 2009.
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6
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