8-KLeadership Changes

Aon plc 8-K Report, Executive Changes (Mar 25, 2009)

Filed March 25, 2009For Securities:AON

Summary

This 8-K filing by Aon plc on March 25, 2009, primarily details changes in executive roles and compensation arrangements. A key development is the appointment of Laurel Meissner as the company's principal accounting officer, effective March 20, 2009, who will continue to report to CFO Christa Davies. This appointment seems to be an internal reorganization as Ms. Meissner had recently joined Aon in February 2009 and was already appointed Senior Vice President and Global Controller. Furthermore, the filing outlines the establishment of Aon's incentive compensation plans for the 2009 fiscal year. This includes setting budgeted pre-tax income from continuing operations as the corporate performance measure for annual bonuses, with a minimum threshold of 85% of planned pre-tax income required for any payout. Long-term incentive awards were also approved, comprising performance share units tied to cumulative earnings per share targets over a three-year period (2009-2011) and stock options vesting over the same term. These compensation adjustments signal the company's focus on incentivizing performance and retaining key executives amidst the prevailing economic climate.

Key Highlights

  • 1Laurel Meissner appointed as Principal Accounting Officer, succeeding Christa Davies in this specific role.
  • 2Christa Davies will continue as Executive Vice President and Chief Financial Officer.
  • 3Ms. Meissner joined Aon in February 2009 and was recently appointed Senior Vice President and Global Controller.
  • 4The company has established budgeted pre-tax income from continuing operations as the key performance measure for 2009 annual incentive awards.
  • 5A minimum performance threshold of 85% of planned pre-tax income is required for any payout under the 2009 annual incentive plan.
  • 6Performance-based long-term incentive awards were granted to Named Executive Officers, consisting of performance share units and stock options.
  • 7Performance share units are tied to cumulative earnings per share targets over a three-year period (2009-2011).

Frequently Asked Questions

Laurel Meissner's appointment as Principal Accounting Officer is an internal management change. While she assumes this specific role, she will continue to report to the CFO, Christa Davies, who remains in her broader executive position. This indicates a division of responsibilities within the accounting leadership team.

For 2009, executive bonuses will be based on the company's budgeted pre-tax income from continuing operations. A minimum performance threshold of 85% of the planned pre-tax income must be achieved for any bonus payout to occur. The potential payout can be up to 300% of an officer's target incentive, capped at $5 million.

The long-term incentives consist of two components: 80% are performance share units and 20% are stock options. The performance share units will be earned based on Aon's cumulative earnings per share performance over a three-year period (January 1, 2009, to December 31, 2011), with a potential to earn between 0% and 200% of target. The stock options vest pro-rata over this same three-year performance period.

Yes, as consideration for his participation in the Leadership Performance Program, Gregory C. Case waived his entitlement to an annual stock option grant valued at no less than $1.8 million per year for the duration of the performance period (2009-2011). This waiver is outlined in his employment agreement.