Document:

Exhibit 10.3

 

AON CORPORATION

LEADERSHIP PERFORMANCE PROGRAM

For 2010-2012

 

Overview

 

The
Program has been adopted by the Committee as a sub-plan to the Stock Plan,
effective as of January 1, 2010. 
The Program is the fifth layer of multi-year performance programs
implemented by the Company.  Earlier
programs covered the following performance periods: January 1, 2006
through December 31, 2008; January 1, 2007 through December 31,
2009; January 1, 2008 through December 31, 2010; and January 1,
2009 through December 31, 2011, respectively.

 

Performance
Cycle

 

The
Program covers a multi-year performance cycle that begins on January 1,
2010 and ends on December 31, 2012 (“Performance Cycle”).

 

Eligibility

 

As
recommended by the CEO and approved by the Committee, key members of the
Company’s senior leadership team are eligible to participate in the Program.
The CEO is also eligible to participate in the Program as approved by the
Committee.

 

Participation

 

The Committee will approve in writing no later than May 31,
2010 the identity of the participants eligible to participate in the Program
and each participant’s Award, denominated as described herein either in total
number of LPP units or US dollars.  Those
participants so identified by May 31, 2010 shall be eligible to
participate in the full Performance Cycle, retroactive to January 1, 2010.

 

If
a participant is no longer considered a member of the Company’s senior
leadership team, but the participant’s employment with the Company has not
terminated, the participant’s Award under the Program shall be unaffected by
the change in status.

 

Award
Components — Performance Share Units

 

At
the outset of participation in the Program, each participant will receive 100%
of his or her Award “value” as target Performance Share Units of the Company’s
common stock.  If the Award is
denominated by the Committee in US dollars, the number of such target units
will be derived by dividing the Award by the Fair Market Value of a share of
the Company’s common stock on the Grant Date.

 

Rules Applicable to
Performance Share Units

 

1.             The Performance
Share Units will be earned and will vest as of the Settlement Date, subject to
the satisfaction of the performance criteria set forth herein.

2.             The payout
resulting from the vesting of the Performance Share Units will be determined
based on the Company’s cumulative adjusted Earnings per Share over the
Performance Cycle as compared to the target Earnings per Share.

3.             Payouts will
range from 0% to 200% of the targeted number of Performance Share Units
awarded.

4.             The Performance
Share Units will pay out in shares of the Company’s common stock issued under,
and subject to, the limitations of the Stock Plan or such other
shareholder-approved Company equity-based incentive plan as designated by the 

 

 

Committee, provided that the pay out in shares shall take place in the
calendar year following the end of the Performance Cycle.

5.             The Company
shall have the right to satisfy all federal, state and local withholding tax
requirements with respect to the award earned by reducing the number of earned
shares by the number of shares determined by dividing the amount of withholding
required by the Fair Market Value of a share of the Company’s common stock on
the Settlement Date.

6.             The Performance
Share Units are not transferable and may not be sold, assigned, pledged,
hypothecated or otherwise encumbered.

7.             Until the
Settlement Date, the participant will not be treated as a stockholder as to
those shares of the Company’s common stock relating to the Performance Share
Units.  No cash payments will be provided
for dividend equivalents or other distributions.

8.             The participant
will be granted a Performance Award Certificate at the outset of his or her
participation in the Program.  The
certificate will set forth the target number of Performance Share Units granted
to the participant.  The participant must
sign and return to the Company the certificate to indicate that he or she
agrees to be bound by the provisions of the Program, including the restrictive
covenants described herein.  Failure to
return a signed certificate to the Company will result in forfeiture of the
Performance Share Units.

9.             If a
participant’s employment with the Company terminates before the last day of the
Performance Cycle, the following rules will apply to the vesting of the
Performance Share Units:

 

	
  Reason
  for

  Employment

  Termination

  	
   

  	
  Impact on Vesting of Performance Share Units

  
	
   

  	
   

  	
   

  
	
  Retirement
  or termination by Company without Cause

  	
   

  	
  Performance
  Share Units will vest pro rata through the date of termination or Retirement,
  and the vested Performance Share Units will pay out in accordance with
  rule 4 above. The Committee’s determination regarding the vested portion
  and payout will occur after the close of the Performance Cycle. The number of
  units earned will be calculated based on the actual achievement of the target
  cumulative earnings per share for the performance period, and then the result
  will be prorated as of the last full calendar quarter preceding the
  participant’s termination or Retirement date.

  
	
   

  	
   

  	
   

  
	
  Death or Total and
  Permanent Disability

  	
   

  	
  Performance Share Units
  will become immediately vested at the greater of the target award level or
  the number of units that would have been earned based on the actual
  cumulative earnings per share during the period of the Performance Cycle in
  which the participant was employed by the Company, and the vested Performance
  Share Units will pay out in accordance with rule 4 above.

  
	
   

  	
   

  	
   

  
	
  Voluntary
  Resignation

  	
   

  	
  Performance
  Share Units will be forfeited in their entirety.

  
	
   

  	
   

  	
   

  
	
  Termination by Company for
  Cause

  	
   

  	
  Performance Share Units
  will be forfeited in their entirety.

  
	
   

  	
   

  	
   

  
	
  Termination due to Change
  in Control

  	
   

  	
  If a successor to the
  Company assumes and continues this Program substantially in its current form
  after a Change in Control, the Performance Share Units will be subject to the
  following rules: (1) if the participant’s employment is terminated by
  the Company without Cause after the Change in Control but prior to the end of
  the Performance Cycle, the participant will

  

 

2

 

	
  Reason
  for

  Employment

  Termination

  	
   

  	
  Impact on Vesting of Performance Share Units

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  become immediately vested
  in the greater of the target Performance Share Units or the number of units
  that would be earned based on the proportion of achievement of the target
  cumulative earnings per share as of the last full calendar quarter preceding
  the participant’s termination date, and the vested Performance Share Units
  will pay out in accordance with rule 4 above; and (2) if the
  participant’s employment is terminated by the Company for Cause, by the
  participant in a voluntary resignation, or by reason of the participant’s
  death or Total and Permanent Disability, or if the participant’s employment
  is continued through the end of the Performance Cycle, the rules of the
  Program shall continue to apply to the Performance Share Units as if the
  Change in Control had not occurred.

   

  If the successor to the
  Company does not assume and continue this Program substantially in its
  current form, the Performance Share Units shall become immediately vested at
  the greater of the target Performance Share Units or the number of units that
  would have been earned based on the proportion of achievement of the target
  cumulative earnings per share as of the last full calendar quarter preceding
  the effective date of the Change in Control, and the vested Performance Share
  Units will pay out in accordance with rule 4 above.

  

 

10.                                 The time and
form of payment of Performance Share Units shall be made in accordance with rule 4
above, provided that with respect to any payment upon the participant’s “separation
from service” (as such term is defined under Section 409A of the Internal
Revenue Code of 1986, as amended (the “Code”)), the payment at such time can be
characterized as a “short-term deferral” for purposes of Code Section 409A
or as otherwise exempt from the provisions of Code Section 409A, or if any
portion of the payment cannot be so characterized, and the participant is a “specified
employee” under Code Section 409A, such portion of the payment shall be
delayed until the earlier to occur of the participant’s death or the date that
is six months and one day following the participant’s termination of employment
(the “Delay Period”).  Upon the
expiration of the Delay Period, all payments delayed pursuant to this section
shall be paid to the participant in accordance with rule 4 above.  For purposes of the Program, the terms “retirement,”
“termination of employment,” “terminated,” “termination,” and variations
thereof, as used in this Program, are intended to mean a termination of
employment that constitutes a “separation from service” under Code Section 409A.

 

11.                                 The time or
schedule of any payout of Performance Share Units pursuant to the terms of the
Program may not be accelerated except as otherwise permitted under Code Section 409A
and the guidance and Treasury regulations issued thereunder.

 

Performance
Measure for Performance Share Units

 

The
performance measure for the Performance Share Units will be cumulative adjusted
Earnings per Share for the Performance Cycle, for which the Committee has
established a target of $9.67.

 

Following
the end of the Performance Cycle, the Committee will determine in its sole
discretion the payout, which determination shall be final and binding.  Performance Share Units will be subject to
complete forfeiture if the Company’s performance for the Performance Cycle does
not 

 

3

 

meet
or exceed a minimum cumulative adjusted Earnings per Share of $9.25, and the
payout for performance at or above that level will be calculated as follows:

 

	
  2010-2012 Cumulative Adjusted EPS

  	
   

  	
  % of Targeted Units Earned

  	
   

  
	
  $

  	
  9.25

  	
   

  	
  50

  	
  %

  
	
  $

  	
  9.67

  	
   

  	
  100

  	
  %

  
	
  $

  	
  10.15

  	
   

  	
  150

  	
  %

  
	
  $

  	
  10.82 or higher

  	
   

  	
  200

  	
  %

  

 

The
Performance Share Units will pay out linearly between each set of data points.

 

Adjustments
to Performance Measures or Results

 

The
Committee will make appropriate adjustments to the target Earnings per Share or
the Company’s actual results on account of: change in accounting policy;
gain/loss on disposition of assets or business; charge for goodwill impairment;
extraordinary legal/regulatory settlements; extraordinary market conditions;
significant currency fluctuations; effects of natural or man-made disasters
(e.g. Word Trade Center); hyperinflation (e.g. >15%); change in statutory
tax rates/regulations; charges from Board-approved restructuring programs;
results of discontinued operations held for sale after sale closing; other
extraordinary, unusual or infrequently occurring items — as defined by GAAP.
The form and manner of any such adjustment shall be at the sole discretion of
the Committee.  By way of example, the
following events will not require adjustment: 
change in accounting estimate; gained/lost pre-tax income from
sold/acquired businesses that represent less than 5% of total pre-tax income;
inflation; general tax developments; litigation costs; effects of repaying or
issuing debt; effects of share buyback/issue; effects of pension plan funding;
changes in benefit/incentive plans; or normal currency/interest rate
fluctuations.

 

Restrictive
Covenants

 

The
Company is in the business of providing insurance brokerage, reinsurance
brokerage, benefits consulting, compensation consulting, human resources
consulting, managing underwriting and related services including accounting,
claims management and handling, contract wording, information systems and
actuarial services.  An essential element
of its business is the development and maintenance of personal contacts and
relationships with clients.  Because of
these contacts and relationships, it is common for the Company’s clients to
develop identification with the employee who services its insurance needs,
rather than with the Company itself.  The
personal identification of clients of the Company with a Company employee
creates potential for the employee’s appropriation of the benefits of the
relationships developed with clients on behalf of and at the expense of the
Company.  Since the Company would suffer
irreparable harm if the employee left its employ and solicited the insurance or
other related business of clients of the Company, it is reasonable to protect
the Company against solicitation activities by the employee for a limited
period of time after the employee leaves the Company so that the Company may
renew or restore its business relationship with its clients.  Therefore, as consideration for participation
in this Program, each participant will be bound by the following restrictive
covenants:

 

Covenant
Not to Solicit

The
employee agrees and covenants that, except with the prior written consent of
the Company, the employee will not for a period of two years after the end of
the employment compete directly or indirectly in any way with the business of
the Company.  For the purposes of this
covenant, “compete directly or indirectly in any way with the business of the
Company” means to enter into or attempt to enter into (on the employee’s own
behalf or on behalf of any other person or entity) any business relationship of
the same type or kind as the business relationship which exists 

 

4

 

between
the Company and its clients or customers, in which the employee was
involved or had knowledge, to provide services related to the business
of the Company for any individual, partnership, corporation, association or
other entity who or which was a client or customer for whom the employee was
the producer or on whose account the Employee worked or became familiar during
the 24 months prior to the end of employment.

 

Covenant
Not to Hire

The
employee also agrees not to induce or attempt to induce, or to cause any person
or other entity to induce or attempt to induce, any person who is an employee
of the Company to leave the employ of the Company during the term of the
covenant set forth above.

 

If
the Company determines that a participant has breached any of the covenants,
his or her stock options and Performance Share Units will be immediately
forfeited.  In the event any of the
restrictive covenants set forth herein is deemed unenforceable, such as against
a non-US employee, the employee agrees that the maximum period, scope or
geographic area reasonable under such circumstances shall be substituted for
the stated period, scope or area and that the court shall be allowed to revise
the restrictions accordingly.

 

Administration

 

It
is expressly understood that the Committee has the discretionary authority to
administer, construe, and make all determinations necessary or appropriate to
the administration of the Program, all of which will be binding upon the
participant.  The Committee may delegate its authority to one or more of its members,
or to one or more members of the Company’s senior management team, to offer
participation in this Program to eligible individuals; provided, however, that
the Committee shall not delegate its authority with respect to the
participation of any officer of the Company who is subject to Section 16
of the Securities Exchange Act of 1934, as amended.  The Company shall, as necessary, adopt
conforming amendments to this Program as are necessary to comply with Code Section 409A.

 

General
Provisions

 

All
obligations of the Company under this Program with respect to payout of Awards,
and the corresponding rights granted thereunder, shall be binding on any
successor to the Company, whether the existence of such successor is the result
of a direct or indirect purchase, merger, consolidation or other acquisition of
all or substantially all of the business and/or assets of the Company.

 

This
Program constitutes a legal document which governs all matters involved with
its interpretation and administration and superseded any writing or
representation inconsistent with its terms.

 

Reservation
and Retention of Company Rights

 

The
selection of any employee for participation in this Program will not give that
participant any right to be retained in the employ of the Company.  No employee will at any time have a right to
be selected for participation in a future performance-based incentive program
despite having been selected for participation in this Program or a previous
program.

 

Stock
Plan Controls

 

Except
as specifically provided in this Program, in the event of any inconsistency
between this Program and the Stock Plan, the Stock Plan will control, but only
to the extent such Stock Plan provisions do not violate the provisions of Code Section 409A.

 

5

 

Code Section 409A

 

The
Company intends that this Program and the Awards granted hereunder be
interpreted and construed to comply with Code Section 409A to the extent
applicable thereto. Notwithstanding any provision of the Program to the
contrary, the Program shall be interpreted and construed consistent with this
intent, provided that the Company shall not be required to assume any increased
economic burden in connection therewith. 
Although the Committee intends to administer the Program so that it will
comply with the requirements of Code Section 409A, neither the Company nor
the Committee represents or warrants that the Program will comply with Code Section 409A
or any other provision of federal, state, local, or non-United States law.  Neither the Company, its subsidiaries, nor
their respective directors, officers, employees or advisers shall be liable to
any participant (or any other individual claiming a benefit through any
participant) for any tax, interest, or penalties any participant may owe as a
result of compensation paid under the Program, and the Company and its
subsidiaries shall have no obligation to indemnify or otherwise protect the
participant from the obligation to pay any taxes pursuant to Code Section 409A.

 

Definitions

 

CEO:  the Company’s Chief
Executive Officer.

 

Cause:  as determined in the sole
discretion of the Committee, means the participant:  (A) performing an act of dishonesty,
fraud, theft, embezzlement or misappropriation involving the participant’s
employment with the Company, or breach of the duty of loyalty to the Company; (B) performing
an act of race, sex, national origin, religion, disability, or age-based
discrimination which, after investigation, counsel to the Company reasonably
concludes will result in liability being imposed on the Company and/or the
participant; (C) material violation of Company policies and procedures
including, but not limited to, the Aon Code of Business Conduct and the Aon
Code of Ethics; or (D) performing an act resulting in a criminal felony
charge (or equivalent offense in a non-US jurisdiction) brought against the
participant or a criminal conviction of the participant (other than a
conviction of a minor traffic violation).

 

Change
in Control:  means the first
to occur of the following:  (1) the
acquisition by any individual, entity or group (a “Person”), including any “person”
within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange
Act) of 30% or more of either (i) the then outstanding shares of common
stock of the Company (the “Outstanding Common Stock”) or (ii) the combined
voting power of the then outstanding securities of the Company entitled to vote
generally in the election of directors (the “Outstanding Voting Securities”);
excluding, however, the following: (A) any acquisition directly from the
Company (excluding any acquisition resulting from the exercise of an exercise,
conversion or exchange privilege unless the security being so exercised,
converted or exchanged was acquired directly from the Company), (B) any
acquisition by the Company, (C) any acquisition by an employee benefit
plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company, or (D) any acquisition by any
corporation pursuant to a transaction which complies with clauses (i), (ii) and
(iii) of subsection (3) of this Section 1(c); provided further,
that for purposes of clause (B), if any Person (other than the Company or any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any corporation controlled by the Company) shall become the beneficial owner
of 30% or more of the Outstanding Common Stock or 30% or more of the Outstanding
Voting Securities by reason of an acquisition by the Company, and such Person
shall, after such acquisition by the Company, become the beneficial owner of
any additional shares of the Outstanding Common Stock or any 

 

6

 

additional
Outstanding Voting Securities and such beneficial ownership is publicly
announced, such additional beneficial ownership shall constitute a Change in
Control;

 

(2)           individuals who, as of the
date hereof, constitute the Board (the “Incumbent Board”) cease for any reason
to constitute at least a majority of such Board; provided that any individual
who becomes a director of the Company subsequent to the date hereof whose
election, or nomination for election by the Company’s stockholders, was
approved by the vote of at least a majority of the directors then comprising
the Incumbent Board shall be deemed a member of the Incumbent Board; and
provided further, that any individual who was initially elected as a director
of the Company as a result of an actual or threatened solicitation by a Person
other than the Board for the purpose of opposing a solicitation by any other
Person with respect to the election or removal of directors, or any other
actual or threatened solicitation of proxies or consents by or on behalf of any
Person other than the Board shall not be deemed a member of the Incumbent
Board;

 

(3)           the consummation of a
reorganization, merger or consolidation or sale or other disposition of all or
substantially all of the assets of the Company (a “Corporate Transaction”);
excluding, however, a Corporate Transaction pursuant to which (i) all or
substantially all of the individuals or entities who are the beneficial owners,
respectively, of the Outstanding Common Stock and the Outstanding Voting
Securities immediately prior to such Corporate Transaction will beneficially
own, directly or indirectly, more than  60% of,
respectively, the outstanding shares of common stock, and the combined voting
power of the outstanding securities entitled to vote generally in the election
of directors, as the case may be, of the corporation resulting from such
Corporate Transaction (including, without limitation, a corporation which as a
result of such transaction owns the Company or all or substantially all of the
Company’s assets either directly or indirectly) in substantially the same
proportions relative to each other as their ownership, immediately prior to
such Corporate Transaction, of the Outstanding Common Stock and the Outstanding
Voting Securities, as the case may be, (ii) no Person (other than:  the Company; any employee benefit plan (or
related trust) sponsored or maintained by the Company or any corporation
controlled by the Company; the corporation resulting from such Corporate Transaction;
and any Person which beneficially owned, immediately prior to such Corporate
Transaction, directly or indirectly, 30% or more of the Outstanding Common
Stock or the Outstanding Voting Securities, as the case may be) will
beneficially own, directly or indirectly, 30% or more of, respectively, the
outstanding shares of common stock of the corporation resulting from such
Corporate Transaction or the combined voting power of the outstanding
securities of such corporation entitled to vote generally in the election of
directors and (iii) individuals who were members of the Incumbent Board
will constitute at least a majority of the members of the board of directors of
the corporation resulting from such Corporate Transaction; or

 

(4)           the consummation of a plan
of complete liquidation or dissolution of the Company.

 

Committee:  the Organization and
Compensation Committee of the Company’s board of directors.

 

Company:  Aon Corporation, a Delaware
corporation, and its subsidiaries.

 

Earnings
per Share or EPS:  the Company’s
earnings per share from continuing operations as reported each quarter.  The Committee has the sole discretion to
approve an adjustment to EPS, in accordance with the adjustment criteria set
forth herein.

 

Fair
Market Value:  the per share
value of the Company’s common stock as determined by using the closing price of
such stock as reported by the New York Stock Exchange on such date (or, if the
New York Stock Exchange was not open for trading or the stock was not traded on
that day, 

 

7

 

the
next preceding day that the New York Stock Exchange was open for trading and
the common stock of the Company was traded).

 

Grant
Date:  the date an Award to a
participant is approved in writing by the Committee.

 

Program
or LPP:  the Leadership Performance
Program, effective January 1,2010.

 

Retire
or Retirement: a voluntary termination of employment at or after
the participant’s 55th birthday.

 

Settlement
Date:  the date that the Committee
determines whether the performance criteria applicable to the Performance Share
Units has been achieved or exceeded and determines the payout to
participants.  The Settlement Date shall
occur as soon as practicable following the close of the Performance Cycle.

 

Settlement
Date Value:  the Fair Market
Value of a share of the Company’s common stock on the date the Committee
determines the amount of the Performance Share Units earned.

 

Stock
Plan:  the 2001 Aon Stock Incentive
Plan, as amended and re-approved by the Company’s stockholders at the 2006
annual meeting of stockholders.

 

Total
and Permanent Disability:  for (a) US
employees, entitlement to long-term disability benefits under the Company’s
program, as amended from time to time and (b) non-US employees, as
established by applicable Company policy or as required by local law or
regulations.

 

If
a term is used but not defined, it has the meaning given such term in the Stock
Plan.

 

8Exhibit 10.4

 

Aon Corporation

Executive Committee Incentive Plan

(Amended and Restated Effective January 1, 2010)

 

Overview

 

Since
2001, Aon has maintained its Omnibus Incentive Plan to encourage the highest
level of performance of its executives through the establishment of
quantifiable performance goals.  Awards
granted under the Omnibus Incentive Plan are intended to qualify as deductible “performance-based”
compensation pursuant to Section 162(m) of the Code.

 

This
Plan was adopted by the Committee, originally effective January 1, 2008,
and as amended and restated herein effective as of January 1, 2010, as a
sub-plan to the Omnibus Incentive Plan to provide a discretionary framework
regarding the funding of awards under the Omnibus Plan, and to provide certain
terms and conditions relating to the form and timing of awards under the
Omnibus Plan.

 

Performance
Period

 

The
Plan is based on successive calendar-year performance periods.

 

Eligibility

 

All
members of Aon’s Executive Committee are eligible to participate in the Plan if
they: (a) are actively employed by Aon as of the last day of the calendar
year; (b) are on an approved leave of absence as of the last day of the
calendar year; or (c) terminated employment on account of death or Total
and Permanent Disability during the calendar year.  The Committee may modify the eligibility
criteria as it deems necessary or appropriate.

 

Award
Calculation

 

At
the beginning of each calendar year, the Committee will approve a “target
incentive award” for each participant as a percentage of his or her base
salary.  The Committee will also
establish corporate performance metrics applicable to the funding of incentive
awards under the Plan, and those metrics may include:  (1) the achievement of a specified
pre-tax income from ongoing operations; (2) the growth in pre-tax income
from ongoing operations as compare to the prior year; (3) organic revenue
growth; and/or (4) any other factors as determined by the Committee in its
sole discretion.  In addition, business
unit, functional and individual performance metrics may be established and
assigned weights to guide the Committee in its allocation of awards to
participants.

 

After
the close of the calendar year, awards to participants will be determined in
the sole discretion of the Committee and paid to participants pursuant to and
contingent upon satisfaction of all conditions under the Omnibus Incentive
Plan.  Awards will be funded in
accordance with the corporate performance criteria adopted by the
Committee.  Awards will be allocated in
the sole discretion of the Committee taking into account, among other facts,
the participants’ target incentive awards and achievement of the assigned
metrics.  Any resulting awards will be
paid pursuant to the terms and conditions of the Omnibus Incentive Plan;
provided, however, in no event will an Award be paid later than two and
one-half months after the end of the calendar year to which such award
relates.  In no event may an award to a
participant exceed the maximum set forth in the Omnibus Incentive Plan (i.e. $5
million). In no event may an award to a participant fail to qualify as
deductible “performance-based” compensation under Section 162(m) of
the Code.

 

Payout
Process

 

After
the awards are determined by the Committee, they will be paid out partly in
cash and partly in restricted stock units of Aon common stock pursuant to the
Stock Plan, unless Aon is contractually obligated to provide a participant’s
award fully in cash.

 

 

For
2010 and later calendar years, Awards exceeding $100,000 in value will be paid
65% in cash and 35% in restricted stock units.

 

The
restricted stock units will be subject to the terms and conditions established
by the Committee; provided, however, that they will vest in three equal
installments on each of the first through third anniversaries of the date of
grant.  The Committee may modify the
manner of distribution for an individual participant or one or more groups of
participants as it deems necessary or appropriate.

 

A
participant will have no right to an award until it is paid.

 

Administration

 

It is expressly understood that the Committee has the discretionary
authority to administer, construe, and make all determinations necessary or
appropriate to the administration of the Plan, all of which will be binding
upon the participant.  The Committee has
the sole discretion to set the Target Award Percentage for each participant and
to determine any final award payment taking into account factors it selects in
its sole discretion including, but not limited to, the duration of a
participant’s employment with the Company during the year.

 

General
Provisions

 

This
Plan constitutes a legal document which governs all matters involved with its
interpretation and administration and superseded any writing or representation
inconsistent with its terms.

 

To
the extent not preempted by federal law, this Plan will be construed in
accordance with, and subject to, the laws of the state of Illinois without
regard to any conflict of laws principles. 
Any legal action related to this Plan must be brought in a federal or
state court located in Illinois.

 

All
awards will be subject to applicable withholding taxes and other required
deductions.

 

Participants
may not assign, transfer, sell, pledge or otherwise alienate their award opportunities,
other than by will or by the laws of descent and distribution.  Any award payable on behalf of a deceased
participant will be paid to the participant’s estate.

 

Aon
is not required to establish a separate account or fund or to make any other
segregation of its assets in connection with awards that could become payable
under this Plan.  Participants will have
rights with regard to earned but unpaid awards that are no greater than the
rights of unsecured general creditors.

 

This
Plan and the benefits provided hereunder are intended to comply with Section 409A
of the Code and the guidance and Treasury Regulations issued thereunder to the
extent applicable thereto. 
Notwithstanding any provision of the Plan to the contrary, the Plan
shall be interpreted and construed consistent with this intent.  Notwithstanding the foregoing, Aon shall not
be required to assume any increased economic burden in connection
therewith.  Although Aon intends to
administer the Plan so that it will comply with the requirements of Section 409A
of the Code, Aon does not represent or warrant that the Plan will comply with Section 409A
of the Code or any other provision of federal, state, local, or non-United
States law.  Neither Aon, nor any
subsidiary, nor its or their respective directors, officers, employees or
advisers shall be liable to any participant (or any other individual claiming a
benefit through the participant) for any tax, interest, or penalties the
participant might owe as a result of participation in the Plan, and neither Aon
nor any subsidiary shall have any obligation to indemnify or otherwise protect
any participant from the obligation to pay any taxes pursuant to Section 409A
of the Code.

 

2

 

Reservation and Retention
of Company Rights

 

Participation in this Plan
will not give a participant any right to be retained in the employ of Aon.  No employee will at any time have a right to
be selected for participation in another performance-based incentive program,
including any future program, on account of his or her participation in this
Plan.

 

All
awards under this Plan are gratuitous in nature and will not become part of any
employment condition or contract.

 

The
Committee reserves the right to amend or terminate this Plan, prospectively or
retroactively, at any time and for any reason.

 

Omnibus
Incentive Plan and Stock Plan Control

 

In
the event of any inconsistency between this Plan and the Omnibus Incentive Plan
or the Stock Plan, the Omnibus Incentive Plan or the Stock Plan, as applicable,
will control unless otherwise specified herein.

 

Definitions

 

“Aon” means Aon Corporation, a Delaware corporation, and its
operating subsidiaries and affiliates.

 

“Code” means the Internal Revenue Code of 1986, as amended.

 

“Committee” means the Organization and Compensation Committee
of the Board of Directors of Aon.

 

“Executive Committee” means the committee comprised of senior
members of Aon’s management team as established from time to time.

 

“Omnibus Incentive Plan” means the 2001 Senior Officer
Incentive Compensation Plan, as amended and restated effective January 1,
2006, or any successor plan.

 

“Organic Revenue Growth” means the growth in revenue
exclusive of the impact of foreign exchange rate changes, acquisitions,
divestitures, transfers between business units, investment income, reimbursable
expenses, and unusual items.

 

“Pre-tax income from ongoing operations” means such term
calculated according to GAAP and as adjusted for certain extraordinary or
special items, in the form and manner determined in the sole discretion of the
Committee and in compliance with IRS regulations, including, but not limited
to: change in accounting policy; gain/loss on disposition of assets or
business; charge for goodwill impairment; extraordinary legal/regulatory
settlements; extraordinary market conditions; significant currency
fluctuations; effects of nature or man-made disasters (e.g. World Trade
Center); hyperinflation (e.g. >15%); change in statutory tax
rates/regulations; charges from Board-approved restructuring programs; results
of discontinued operations held for sale after sale closing; other
extraordinary, unusual or infrequently occurring items — as defined by GAAP.

 

“Stock Plan” means the 2001 Aon Stock Incentive Plan, as amended
and re-approved by Aon’s stockholders at the 2006 annual meeting of
stockholders, or any successor plan.

 

“Total
and Permanent Disability” means (a) for US employees, entitlement
to long-term disability benefits under Aon’s program as amended from time to
time, and (b) for non-US employees, as established by applicable company
policy or as required by local law or regulations.

 

If
a term is used but not defined, it has the meaning given such term in the
Omnibus Incentive Plan.

 

3

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00172-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00172-of-00352.parquet"}]]