<PAGE>
As filed with the Securities and Exchange Commission on May 2, 1995.
Registration No.
-----------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-------------------------------------
Aon CORPORATION
(Exact name of issuer as specified in its charter)
Delaware 36-3051915
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
------------------------
(1) ENERGY INSURANCE INTERNATIONAL, INC. 1989
INCENTIVE STOCK OPTION PLAN
1990 INCENTIVE STOCK OPTION PLAN
(2) Aon STOCK AWARD PLAN
(Full title of the plans)
------------------------
Raymond I. Skilling, Esq. (Telephone Number, including
Executive Vice President and area code, of agent for service)
Chief Counsel
123 North Wacker Drive Copy to:
Chicago, Illinois 60606 Jerome S. Hanner, Senior Counsel
(Name and address of agent for Aon Corporation
service) 123 North Wacker Drive
(312) 701-3025 Chicago, Illinois 60606
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of Amount to Proposed Proposed Amount of
Securities to be Be Maximum Maximum Registration Fee
Registered Registered Offering Price Aggregate
Per Share Offering Price
<S> <C> <C> <C> <C>
Common Stock, 145,386 $8.48 $ 1,232,939(1) $425.15
$1.00 par value shares for the
Energy Insurance
International
1989 Incentive
Stock Option
Plan and 1990
Incentive Stock
Option Plan
2,000,000 shares $72,500,000(2) $25,431.03
for the Aon
Stock Award
Plan
Total:
$25,856.19
</TABLE>
(1) Calculated based on average of actual exercise prices of outstanding
options.
(2) Calculated pursuant to Rule 457(c), based upon the price of Registrant's
Common Stock on April 28, 1995 on the New York Stock Exchange.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
---------------------------------------
The following documents are incorporated by reference in the registration
statement:
(a) The Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994 filed pursuant to Section 13(a) of the Securities Exchange Act
of 1934.
(b) All other reports filed by the Registrant pursuant to Sections 13(a) or
15(d) of the Securities Exchange Act of 1934 since December 31, 1994.
(c) The description of the Common Stock contained in the Registrant's
registration statement on Form 8-A filed under the Securities Exchange Act of
1934 (File No. 1-7933), including any amendment or report filed for the purpose
of updating such description.
All documents subsequently filed by the Registrant pursuant to Section
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to the
filing of a post-effective amendment which indicates that all shares offered
have been sold or which deregisters all shares then remaining unsold, shall be
deemed to be incorporated by reference in the registration statement and to be
part hereof from the date of filing of such documents.
Item 5. Interest of Named Experts and Counsel
-------------------------------------
The validity of the issuance of the Common Stock offered pursuant to the
plans registered hereunder will be passed upon for the Registrant by Jerome S.
Hanner, Senior Counsel of the Registrant. As of May 1, 1995, Mr. Hanner owned
3,070 shares of Common Stock.
Item 6. Indemnification of Directors and Officers
-----------------------------------------
Registrant's Certificate of Incorporation provides that the Registrant
shall indemnify each director and officer of the Registrant to the fullest
extent permitted by law, subject to the limitations set forth in its By-Laws.
The By-Laws provide that the Registrant shall indemnify to the fullest extent
permitted by law any person made or threatened to be made a party to any action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that such person is or was a director or officer of the
Registrant or serves or served at the request of the Registrant any other
enterprise as a director or officer.
Section 145 of the General Corporation Law of the State of Delaware
provides for the indemnification of directors and officers under certain
circumstances, as therein set forth.
Item 8. Exhibits
--------
The following are filed as exhibits to this registration statement:
II-1
<PAGE>
4.1 Second Restated Certificate of Incorporation of the Registrant -
incorporated by reference to Exhibit 3(a) to the Registrant's Annual
Report on Form 10-K for the year ended December 31, 1991.
4.2 Certificate of Amendment of the Registrant's Second Restated
Certificate of Incorporation -incorporated by reference to Exhibit 3
to the Registrant's Quarterly Report on Form 10-Q for the quarter
ending March 31, 1994, (the "First Quarter 1994 Form 10-Q").
4.3 Certificate of Designation of 6 1/4% Cumulative Convertible
Exchangeable Preferred Stock --incorporated by reference to Exhibit
4(b) to the Registrant's Quarterly Report on Form 10-Q for the period
ended September 30, 1992.
4.4 Bylaws of the Registrant - incorporated by reference to Exhibit (d) to
the Registrant's Annual Report on Form 10-K for the year ended
December 31, 1982.
4.5 Energy Insurance International, Inc., 1989 Incentive Stock Option Plan
and Energy Insurance International, Inc. 1990 Incentive Stock Option
Plan - Filed as Exhibits 4.5A and 4.5B herewith.
4.6 Aon Stock Award Plan, as amended-incorporated by reference to Exhibit
10 (a) to the First Quarter 1994 Form 10-Q.
4.7 First Amendment to the Aon Stock Award Plan - incorporated by
reference to the Registrant's Quarterly Report on Form 10-Q for the
Quarter ending June 30, 1994 (the "Second Quarter 1994 Form 10-Q").
4.8 Second Amendment to the Aon Stock Award Plan - incorporated by
reference to the Second Quarter 1994 Form 10-Q.
5 Opinion of Jerome S. Hanner, Senior Counsel of the Registrant.
24.1 Consent of Ernst & Young LLP.
24.2 Consent of Jerome S. Hanner (contained in the opinion filed as Exhibit
5 to the registration statement).
Item 9. Undertakings
------------
The Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement to include any material
information with respect to the plan of distribution not previously disclosed in
the registration statement or any material change to such information in the
registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933 (the "Act"), each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
II-2
<PAGE>
(3) That, for the purposes of determining any liability under the Act, each
filing of the Registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 that is incorporated by reference
in the registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(4) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(5) Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the provisions described in Item 6 or otherwise, the Registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Chicago, State of Illinois, on May 1, 1995.
Aon CORPORATION
By /s/ PATRICK G. RYAN
-----------------------------------
Patrick G. Ryan, Chairman,
President and Chief
Executive Officer
Each person whose signature appears below constitutes and appoints
Patrick G. Ryan and Raymond I. Skilling, Esq., and each of them, as his true and
lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments to this registration statement, and
to file the same with all exhibits thereto, and other documents in connection
therewith, with the Commission, granting unto said attorney-in-fact and agent
full power and authority to do and perform each act and thing requisite and
necessary to be done, as fully to all intents and purposes as he might or could
do in person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
II-3
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
/S/ PATRICK G. RYAN
___________________________ Chairman, May 1, 1995
(Patrick G. Ryan) President, Chief
Executive Officer and Director
(Principal Executive Officer)
____________________________ Director May 1, 1995
(Daniel T. Carroll)
/S/ FRANKLIN A. COLE
___________________________ Director May 1, 1995
(Franklin A. Cole)
___________________________ Director May 1, 1995
(Edgar D. Jannotta)
___________________________ Director May 1, 1995
(Perry J. Lewis)
/S/ JOAN D. MANLEY
___________________________ Director May 1, 1995
(Joan D. Manley)
/S/ ANDREW J. McKENNA
___________________________ Director May 1, 1995
(Andrew J. McKenna)
___________________________ Director May 1, 1995
(Newton N. Minow)
II-4
<PAGE>
___________________________ Director May 1, 1995
(Peer Pedersen)
/S/ DONALD S. PERKINS
___________________________ Director May 1, 1995
(Donald S. Perkins)
___________________________ Director May 1, 1995
(John W. Rogers, Jr.)
/S/ GEORGE A. SCHAEFER
___________________________ Director May 1, 1995
(George A. Schaefer)
/S/ RAYMOND I. SKILLING
___________________________ Director May 1, 1995
(Raymond I. Skilling)
/S/ FRED L. TURNER
___________________________ Director May 1, 1995
(Fred L. Turner)
___________________________ Director May 1, 1995
(Arnold R. Weber)
/S/ HARVEY N. MEDVIN
___________________________ Executive Vice May 1, 1995
(Harvey N. Medvin) President, Chief
Financial Officer
and Treasurer
(Principal Financial
and Accounting Officer)
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequential
Exhibit No. Description Page
- ----------- ----------- -----------
<S> <C> <C>
4.1 Second Restated Certificate of
Incorporation of the Registrant -
incorporated by reference to
Exhibit 3(a) to the Registrant's
Annual Report on Form 10-K ____
for the year ended December
31, 1991.
4.2 Certificate of Amendment of
the Registrant's Second restated
Certificate of Incorporation-
incorporated by reference to
Exhibit 3 to the Registrant's
Quarterly Report on Form 10-Q
for the quarter ending March ____
31, 1994, (the "First Quarter
1994 Form 10-Q").
4.3 Certificate of Designation of 6
1/4% Cumulative Convertible
Exchangeable Preferred Stock -
incorporated by reference to
Exhibit 4(b) to the Registrant's
Quarterly Report on Form 10-Q
for the period ended September
30, 1992. ____
4.4 Bylaws of the Registrant -
incorporated by reference to
Exhibit (d) to the Registrant's
Annual Report on Form 10-K ____
for the year ended December
31, 1982.
</TABLE>
II-6
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
4.5 1989 Incentive Stock Option
Plan of Energy Insurance
International, Inc. filed as
Exhibit 4.5A hereto.
12
1990 Incentive Stock
Option Plan of Energy
Insurance International, Inc.
filed as Exhibit 4.5B hereto 21
4.6 Aon Stock Award Plan, as
amended-incorporated by
reference to Exhibit 10 (a) to ___
the First Quarter 1994 Form
10-Q.
4.7 First Amendment to the Aon
Stock Award Plan -
incorporated by reference to the
Registrant's Quarterly Report
on Form 10-Q for the quarter
ending June 30, 1994 (the
"Second Quarter 1994 Form
10-Q").
4.8 Second Amendment to the Aon
Stock Award Plan -
incorporated by reference to the ____
Second Quarter 1994 Form
10-Q.
5 Opinion of Jerome S. Hanner,
Senior Counsel of the
Registrant. 10
24.1 Consent of Ernst & Young LLP. 11
24.2 Consent of Jerome S. Hanner
(contained in the opinion filed
as Exhibit 5 to the registration
statement). 10
</TABLE>
II-7
<PAGE>
May 1, 1995
Aon Corporation
Chicago, Illinois 60606
Ladies and Gentlemen:
I have participated in the preparation of the Registration Statement on Form S-8
to be filed with the Securities and Exchange Commission covering 2,145,386
shares of Common Stock $1 par value per share (the "Shares") of Aon Corporation
(the "Company") reserved for issuance under the Energy Insurance International,
Inc. 1989 and 1990 Incentive Stock Option Plans and the Aon Stock Award Plan
(collectively the "Plans"). (Energy Insurance International, Inc. is a wholly
owned subsidiary of the Company). I am familiar with the Company's Second
Restated Certificate of Incorporation, as amended, its Bylaws, and the terms of
the Plans. I have also made or caused to be made such further examination as I
have deemed necessary in order for me to render this opinion.
Based on the foregoing, I am of the opinion that the 2,145,386 Shares of the
Company being registered will, when issued in accordance with the terms of the
Plans, be legally issued, fully paid, and non-assessable.
I hereby consent to the use of this opinion as Exhibit 5 to the Registration
Statement and to the use of my name in the Registration Statement.
Very truly yours,
/s/ Jerome S. Hanner
- --------------------
Jerome S. Hanner
Senior Counsel
II-8
<PAGE>
1989 INCENTIVE STOCK OPTION PLAN
ENERGY INSURANCE INTERNATIONAL, INC.
Energy Insurance International, Inc., a Texas corporation (the "Company"),
hereby establishes and adopts the following 1989 Incentive Stock Option Plan
(the "Plan"):
I. PURPOSE
-------
The Plan is intended as an employment incentive, to retain in the
employment of the Company and its subsidiaries persons of training, experience
and ability, to attract new employees whose services are considered unusually
valuable, to encourage the sense of proprietorship of such persons, and to
stimulate the active interest of such persons in the development and financial
success of the Company.
II. DEFINITIONS
-----------
As used in this Plan, the following words and phrases shall have the
following meanings:
(1) Board of Directors or "Board" shall mean the Board of Directors of the
Company.
(2) Code shall mean the Internal Revenue Code of 1986, as amended.
(3) Committee shall mean the Board or a Committee of the Board designated
by the Board to administer the Plan as provided herein.
(4) Company means Energy Insurance International, Inc. and any successor
thereto by merger, consolidation, liquidation or other reorganization which has
made provision for adoption of the Plan and the assumption of the Company's
obligations hereunder.
(5) Eligible Employee shall mean any person who is employed on a full time
salaried basis by the Company or a Subsidiary, including, but not limited to,
any employee who is also an officer and director of the Company or a Subsidiary.
(6) Options shall mean the stock options granted from time to time under
the Plan.
(7) Participant shall mean an Eligible Employee who has been designated by
the Committee to participate in the Plan.
<PAGE>
(8) Subsidiary shall mean any corporation to which the Company is a
"parent corporation" as defined in Section 425(e) of the Code.
III. DURATION
--------
The effective date of the Plan (the "Effective Date") is March 31, 1989,
subject to approval of the Plan by the Company's shareholders within twelve
months after the Effective Date. Any Option may be granted on or after the
Effective Date but not be exercisable prior to shareholder approval of this
Plan; if such shareholder approval is not obtained within twelve months after
the Effective Date, the grant of such Option shall be of no force and effect. No
Option shall be granted pursuant to the Plan more than ten years after the
Effective Date.
IV. ADMINISTRATION
--------------
The Plan will be administered as follows:
Committee
- ---------
The Plan shall be administered by the Board or such Committee of the Board as
may be constituted by the Board from time to time. The Committee shall consist
of at least three members of the Board.
Committee Powers
- ----------------
The Committee shall be deemed to have and to be exercising all of the powers
of the Board in the performance of any of the powers and duties delegated to it
under the Plan, including, without limitation, the selection of Participants,
the determination of the number of shares for which each Participant shall be
granted an Option, and all other terms and conditions of each Option to the
extent not inconsistent with the Plan. The Committee may from time to time
establish eligibility requirements for participation in the Plan and rules for
the administration of the Plan that are not inconsistent with the provisions and
purposes of the Plan. The Committee shall have the authority, exercisable in its
sole discretion, to grant various forms of Options containing such terms and
conditions, consistent with the provisions of this Plan, as the Committee shall
determine.
Committee Action
- ----------------
A majority of the members of the Committee shall constitute a quorum. All
action taken by the Committee at a meeting shall be by the vote of a majority of
those present at such meeting, but any action may be taken by the Committee
without a meeting upon written consent signed by all of the members of the
Committee. Members of
-2-
<PAGE>
the Committee may participate in a meeting by means of conference telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other. The Committee shall appoint a secretary and
shall keep minutes of its meetings, including those conducted by telephone
conference.
Committee Determination Conclusive
- ----------------------------------
The determination of the Committee as to any disputed question arising under
the Plan, including questions of construction and interpretation, shall be
final, binding, and conclusive upon all persons. Without limiting the generality
of the foregoing, the determination of the Committee as to whether a Participant
has terminated his employment and the date thereof, or the cause to which
termination of employment is attributable, shall be final, binding, and
conclusive upon all persons.
Committee Liability
- -------------------
No member of the Committee or of the Board as a whole shall be liable to any
person for any action taken or omitted in connection with the interpretation or
administration of the Plan unless attributable to such member's own willful
misconduct or lack of good faith.
Expenses of Administration
- --------------------------
All expenses of administration of the Plan shall be borne by the Company, and
no part thereof shall be directly charged against the Participants.
V. SHARES SUBJECT TO THE PLAN
--------------------------
Subject to adjustment as provided in Section VIII hereof, a total of eighty-
eight thousand six hundred and forty shares of Common Stock of the Company (the
"Shares") shall be subject to the Plan. The Shares shall consist of unissued
shares or previously issued shares reacquired and held by the Company, and such
number of shares shall be and is hereby reserved for sale for such purpose. Any
of the Shares which remain unsold and which are not subject to outstanding
Options at the termination of the Plan shall cease to be reserved for the
purpose of the Plan, but until termination of the Plan, the Company shall at all
times reserve a sufficient number of Shares to meet the requirements of the
Plan. Should any Option expire or be cancelled prior to its exercise, the Shares
theretofore subject to such Option may again be subjected to an Option under the
Plan.
-3-
<PAGE>
VI. PARTICIPATION
-------------
Participation in the Plan will be subject to the following:
Eligibility
- -----------
Full time salaried employees of the Company or a Subsidiary who are in a
position to materially contribute to the Company's or such Subsidiary's success
shall be eligible for participation in the Plan. Eligible Employees shall
include, but shall not necessarily be limited to, officers and directors of the
Company or a Subsidiary. Members of the Board of Directors or the board of
directors of a Subsidiary shall not be Eligible Employees solely by virtue of
their being directors of the Company or such Subsidiary, but directors otherwise
qualified shall be eligible to participate.
Participants
- ------------
The Committee shall determine and designate from time to time those
management, professional and key employees of the Company and its Subsidiaries,
including officers and directors active in capacities other than as directors
only, to whom Options are to be granted and who thereby become Participants in
the Plan. A designation of an Eligible Employee to participate shall not
automatically entitle such Participant to participate with respect to future
Options.
VII. PLAN OPERATION
--------------
The Plan shall operate according to the following general guidelines:
Time of Granting Options
- ------------------------
Neither anything contained in the Plan or in any resolution adopted or to be
adopted by the Board of Directors or the stockholders of the Company nor any
action taken by the Committee shall constitute the granting of any Option. The
granting of an Option shall take place only when a written option agreement
shall have been duly executed and delivered by or on behalf of the Company and
the Participant to whom such Option has been granted. No Option shall be granted
following the expiration of ten (10) years from the earlier of (i) the Effective
Date of this Plan as stated in Article III, or (ii) approval of this Plan by the
shareholders of the Company.
Option Price
- ------------
The purchase price of each Share placed under Option shall be determined
by the Committee, but shall in no event be less than one
-4-
<PAGE>
hundred percent (100%) of the fair market value of such Share on the date the
Option is granted. However, the purchase price of each Share placed under Option
to a Participant who owns stock possessing more than ten percent (10%) of the
total combined voting power of all classes of stock of the Company or any
Subsidiary at the time of the grant shall be at least one hundred and ten
percent (110%) of the fair market value of such Share on the date the option is
granted.
Option Period and Terms
- -----------------------
No Option shall be exercisable after the expiration of ten (10) years from the
date such Option is granted. However, if the Participant to whom an Option is
granted owns stock possessing more than ten percent (10%) of the total combined
voting power of all classes of stock of the Company or any Subsidiary at the
time such Option is granted, such Option shall not be exercisable after the
expiration of five (5) years from the date such Option is granted. Subject to
the provisions of the Plan, the Committee shall determine the terms and
conditions of each Option granted under the Plan, including the number of Shares
covered by the Option, and the time or times of exercise of the Option (which
may be for a term of up to ten (10) years from the date the Option is granted,
or, in the discretion of the Committee, may be for a shorter term designated by
the Committee). The Committee may provide that an Option shall not be
exercisable for a designated period of time after grant. The Committee may
provide that failure to exercise an option as to the exercisable portion of the
Option during a specific time shall constitute a forfeiture of the right to
exercise such Option after termination of that time period. So long as
consistent with the provisions of the Plan, the terms and conditions of any
Option need not be the same as the terms and conditions of any other Option.
Maximum Annual Amount Per Employee
- ----------------------------------
The aggregate fair market value (determined as of the time the Option is
granted) of the stock with respect to which Options are exercisable for the
first time by any employee during any calendar year (under this and any other
plans of the Company or any Subsidiary) shall not exceed $100,000.
Exercise of Options
- -------------------
No Option may be exercised unless the Participant shall have been an employee
of the Company or a Subsidiary at all times during the period beginning on the
date of grant of the Option and ending on the day three (3) months before the
date of such exercise. However, if a Participant is disabled (within the meaning
of Section 37(e)(3) of the Code), no Option may be exercised by such Participant
unless he shall have been an employee of the Company or a Subsidiary at all
times during the period beginning on the
-5-
<PAGE>
date of grant of the Option and ending on the date one (1) year before the date
of such exercise. If an Option is exercised after the death of a Participant by
the estate of such Participant, or by a person who acquired the right to
exercise such Option by bequest or inheritance or by reason of the death of such
Participant, the employment requirements of this paragraph shall not apply.
Options may be exercised solely by the Participant during his lifetime or after
his death by the personal representative of the Participant's estate or the
person or persons entitled thereto under his will or under the laws of descent
and distribution.
The purchase price of the Shares as to which an Option is exercised shall be
paid in full in cash and/or other property, including stock of the Company, as
deemed acceptable by the Committee, at the time of the exercise. A Participant
shall not be or have any of the rights or privileges of a shareholder of the
Company in respect of any Shares purchasable upon the exercise of any part of an
Option unless and until certificates representing such Shares shall have been
issued by the Company to such Participant.
Use of Proceeds
- ---------------
The proceeds received by the Company from the sale of stock pursuant to this
Plan will be used for general corporate purposes.
VIII. CAPITAL CHANGES OF THE COMPANY
------------------------------
In the event there is any change in the Common Stock of the Company through
the declaration of stock dividends, or through recapitalization resulting in
stock splits, or combinations or exchanges of shares, or any similar
transactions, the number of Shares subject to Options previously granted and the
number of Shares remaining available for Options and the price per Share of such
Shares shall be appropriately adjusted by the Committee.
In the event the Company shall be a party to any merger, consolidation or
corporate reorganization, as the result of which the Company shall be the
surviving corporation, the rights and duties of the Participants and the Company
shall not be affected in any manner. In the event the Company shall sell all or
substantially all of its assets or shall be a party to any merger, consolidation
or corporate reorganization, as the result of which the Company shall not be the
surviving organization, or in the event any other corporation may make a tender
or exchange offer for stock of the Company (the surviving corporation,
purchaser, or tendering corporation being hereinafter collectively referred to
as the "purchaser," and the transaction being hereinafter referred to as the
"purchase"), then the Board of Directors may, at its election, (i) reach an
agreement with the purchaser that the
-6-
<PAGE>
purchaser will assume the obligations of the Company as to all outstanding
Options; (ii) reach an agreement with the purchaser that the purchaser will
convert each outstanding Option into an option of at least equal value as to
stock of the purchaser; or (iii) not later than thirty (30) days prior to the
effective date of the purchase, notify all Participants that their Options are
accelerated and afford to each Participant a right for ten (10) days after the
date of such notice to exercise any then unexercised portion of all Options held
by him whether or not such Options shall then be exercisable under the terms of
the Plan or his option agreement; and within such ten day period, each such
Participant may exercise any portion of any Option as he may desire.
IX. LIMITATION OF RIGHTS
--------------------
Participation in this Plan is subject to certain limitations:
Limitations
- -----------
Nothing in this Plan shall be construed to:
(1) give any employee of the Company or a Subsidiary any right to be
designated a Participant herein, other than in the sole discretion of the
Committee;
(2) give a Participant any rights whatsoever with respect to Shares
until Options are exercised and Shares are issued to the Participant;
(3) give a Participant or any person any interest in any fund or in
any specific asset or assets of the Company;
(4) limit in any way the right of the Company or a Subsidiary to
terminate a Participant's employment with the Company or a Subsidiary at
any time; or
(5) be evidence of any agreement or understanding, express or implied,
that the Company or a Subsidiary will employ a Participant in any particular
position or at any particular rate of remuneration.
Nonassignability of Options
- ----------------------------
Options shall not be transferable other than by will or by the laws of descent
and distribution, and during a Participant's lifetime shall be exercisable only
by him.
-7-
<PAGE>
Power of the Company
- --------------------
The existence of outstanding Options shall not affect in any way the right or
power of the Company or its subsidiaries or their stockholders to make or
authorize any or all adjustments, recapitalization, reorganization or other
changes in the capital structure of the Company or its Subsidiaries or their
businesses, or any merger or consolidation of the Company or its Subsidiaries or
any issue of bonds, debentures, preferred or the right thereof, or the
dissolution or liquidation of the Company or its Subsidiaries, or any sale or
transfer of all or any part of their assets or business, or any other corporate
act or proceeding whether of a similar character or otherwise.
X. TERMINATION AND AMENDMENT OF THE PLAN
-------------------------------------
The Plan shall terminate upon the expiration of ten years after the Effective
Date and an Option shall not be granted after that date. The Board of Directors
may amend, alter, or discontinue the Plan, but no amendment or alteration shall
be made which would impair the rights of any Participant under any Option
theretofore granted, without his consent, unless his Option Agreement so
provides. The Board of Directors may at any time and from time to time modify or
amend the Plan in such respects as it shall deem advisable in order that the
Options shall be "incentive stock options" as defined in Section 422A of the
Code.
XI. GOVERNMENT REGULATIONS
----------------------
The Plan, and the granting and exercise of Options thereunder, and the
obligation of the Company to sell and deliver Shares under such Options, shall
be subject to all applicable laws, rules and regulations, and to such approvals
by any governmental agencies or national securities exchanges as may be
required.
Purchase for Investment
- -----------------------
Whether or not the Options and Shares covered by the Plan have been registered
under the Securities Act of 1933, as amended, each Participant exercising an
Option may be required by the Company to give a representation in writing that
he is acquiring such Shares for his own account for investment and not with a
view to, or for sale in connection with, the distribution of any part thereof.
Governing Law
- -------------
The place of administration of the Plan shall be conclusively deemed to be
within the State of Texas; and the validity, construction, interpretation and
effect of the Plan and all rights
-8-
<PAGE>
of any of the persons having or claiming to have any interest in the Plan shall
be governed by the laws of the State of Texas.
IN WITNESS WHEREOF, Energy Insurance International, Inc. has caused the Plan
to be executed by its duly authorized officers in a number of copies, each of
which shall be deemed an original, but all of which shall constitute the same
instrument, effective this 31st day of March 1989.
ENERGY INSURANCE INTERNATIONAL, INC.
By: /s/ John N. Molbeck, Jr.
-------------------------------------
John N. Molbeck, Jr.
President
-9-
<PAGE>
1990 INCENTIVE STOCK OPTION PLAN
ENERGY INSURANCE INTERNATIONAL, INC.
Energy Insurance International, Inc., a Texas corporation (the "Company"),
hereby establishes and adopts the following 1990 Incentive Stock Option Plan
(the "Plan"):
I. PURPOSE
-------
The Plan is intended as an employment incentive, to retain in the employment
of the Company and its subsidiaries persons of training, experience and ability,
to attract new employees whose services are considered unusually valuable, to
encourage the sense of proprietorship of such persons, and to stimulate the
active interest of such persons in the development and financial success of the
Company.
II. DEFINITIONS
-----------
As used in this Plan, the following words and phrases shall have the
following meanings:
(1) Board of Directors or "Board" shall mean the Board of Directors
of the Company.
(2) Code shall mean the Internal Revenue Code of 1986, as amended.
(3) Committee shall mean the Board or a Committee of the Board
designated by the Board to administer the Plan as provided herein.
(4) Company means Energy Insurance International, Inc. and any successor
thereto by merger, consolidation, liquidation or other reorganization which
has made provision for adoption of the Plan and the assumption of the
Company's obligations hereunder.
(5) Eligible Employee shall mean any person who is employed on a full
time salaried basis by the Company or a Subsidiary, including, but not limited
to, any employee who is also an officer and director of the Company or a
Subsidiary.
(6) Options shall mean the stock options granted from time to time under
the Plan.
(7) Participant shall mean an Eligible Employee who has been designated
by the Committee to participate in the Plan.
<PAGE>
(8) Subsidiary shall mean any corporation to which the Company is a
"parent corporation" as defined in Section 425(e) of the Code.
III. DURATION
--------
The effective date of the Plan (the "Effective Date") is January 31, 1990,
subject to approval of the Plan by the Company's shareholders within twelve
months after the Effective Date. Any Option may be granted on or after the
Effective Date but not be exercisable prior to shareholder approval of this
Plan; if such shareholder approval is not obtained within twelve months after
the Effective Date, the grant of such Option shall be of no force and effect. No
Option shall be granted pursuant to the Plan more than ten years after the
Effective Date.
IV. ADMINISTRATION
--------------
The Plan will be administered as follows:
Committee
- ---------
The Plan shall be administered by the Board or such Committee of the Board as
may be constituted by the Board from time to time. The Committee shall consist
of at least three members of the Board.
Committee Powers
- ----------------
The Committee shall be deemed to have and to be exercising all of the powers
of the Board in the performance of any of the powers and duties delegated to it
under the Plan, including, without limitation, the selection of Participants,
the determination of the number of shares for which each Participant shall be
granted an Option, and all other terms and conditions of each Option to the
extent not inconsistent with the Plan. The Committee may from time to time
establish eligibility requirements for participation in the Plan and rules for
the administration of the Plan that are not inconsistent with the provisions and
purposes of the Plan. The Committee shall have the authority, exercisable in its
sole discretion, to grant various forms of Options containing such terms and
conditions, consistent with the provisions of this Plan, as the Committee shall
determine.
Committee Action
- ----------------
A majority of the members of the Committee shall constitute a quorum. All
action taken by the Committee at a meeting shall be by the vote of a majority of
those present at such meeting, but any action may be taken by the Committee
without a meeting upon written consent signed by all of the members of the
Committee. Members of
-2-
<PAGE>
the Committee may participate in a meeting by means of conference telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other. The Committee shall appoint a secretary and
shall keep minutes of its meetings, including those conducted by telephone
conference.
Committee Determination Conclusive
- ----------------------------------
The determination of the Committee as to any disputed question arising under
the Plan, including questions of construction and interpretation, shall be
final, binding, and conclusive upon all persons. Without limiting the generality
of the foregoing, the determination of the Committee as to whether a Participant
has terminated his employment and the date thereof, or the cause to which
termination of employment is attributable, shall be final, binding, and
conclusive upon all persons.
Committee Liability
- -------------------
No member of the Committee or of the Board as a whole shall be liable to any
person for any action taken or omitted in connection with the interpretation or
administration of the Plan unless attributable to such member's own willful
misconduct or lack of good faith.
Expenses of Administration
- --------------------------
All expenses of administration of the Plan shall be borne by the Company, and
no part thereof shall be directly charged against the Participants.
V. SHARES SUBJECT TO THE PLAN
--------------------------
Subject to adjustment as provided in Section VIII hereof, a total of fifty
thousand shares of Common Stock of the Company (the "Shares") shall be subject
to the Plan. The Shares shall consist of unissued shares or previously issued
shares reacquired and held by the Company, and such number of shares shall be
and is hereby reserved for sale for such purpose. Any of the Shares which remain
unsold and which are not subject to outstanding Options at the termination of
the Plan shall cease to be reserved for the purpose of the Plan, but until
termination of the Plan, the Company shall at all times reserve a sufficient
number of Shares to meet the requirements of the Plan. Should any Option expire
or be cancelled prior to its exercise, the Shares theretofore subject to such
Option may again by subjected to an Option under the Plan.
-3-
<PAGE>
VI. PARTICIPATION
-------------
Participation in the Plan will be subject to the following:
Eligibility
- -----------
Full time salaried employees of the Company or a Subsidiary who are in a
position to materially contribute to the Company's or such Subsidiary's success
shall be eligible for participation in the Plan. Eligible Employees shall
include, but shall not necessarily be limited to, officers and directors of the
Company or a Subsidiary. Members of the Board of Directors or the board of
directors of a Subsidiary shall not be Eligible Employees solely by virtue of
their being directors of the Company or such Subsidiary, but directors otherwise
qualified shall be eligible to participate.
Participants
- ------------
The Committee shall determine and designate from time to time those
management, professional and key employees of the Company and its Subsidiaries,
including officers and directors active in capacities other than as directors
only, to whom Options are to be granted and who thereby become Participants in
the Plan. A designation of an Eligible Employee to participate shall not
automatically entitle such Participant to participate with respect to future
Options.
VII. PLAN OPERATION
--------------
The Plan shall operate according to the following general guidelines:
Time of Granting Options
- ------------------------
Neither anything contained in the Plan or in any resolution adopted or to be
adopted by the Board of Directors or the stockholders of the Company nor any
action taken by the Committee shall constitute the granting of any Option. The
granting of an Option shall take place only when a written option agreement
shall have been duly executed and delivered by or on behalf of the Company and
the Participant to whom such Option has been granted. No Option shall be granted
following the expiration of ten (10) years from the earlier of (i) the Effective
Date of this Plan as stated in Article III, or (ii) approval of this Plan by the
shareholders of the Company.
Option Price
- ------------
The purchase price of each Share placed under Option shall be determined by
the Committee, but shall in no event be less than one
-4-
<PAGE>
hundred percent (100%) of the fair market value of such Share on the date the
Option is granted. However, the purchase price of each Share placed under Option
to a Participant who owns stock possessing more than ten percent (10%) of the
total combined voting power of all classes of stock of the Company or any
Subsidiary at the time of the grant shall be at least one hundred and ten
percent (110%) of the fair market value of such Share on the date the Option is
granted.
Option Period and Terms
- -----------------------
No Option shall be exercisable after the expiration of ten (10) years from the
date such Option is granted. However, if the Participant to whom an Option is
granted owns stock possessing more than ten percent (10%) of the total combined
voting power of all classes of stock of the Company or any Subsidiary at the
time such Option is granted, such Option shall not be exercisable after the
expiration of five (5) years from the date such Option is granted. Subject to
the provisions of the Plan, the Committee shall determine the terms and
conditions of each Option granted under the Plan, including the number of Shares
covered by the Option, and the time or times of exercise of the Option (which
may be for a term of up to ten (10) years from the date the Option is granted,
or, in the discretion of the Committee, may be for a shorter term designated by
the Committee). The Committee may provide that an Option shall not be
exercisable for a designated period of time after grant. The Committee may
provide that failure to exercise an Option as to the exercisable portion of the
Option during a specific time shall constitute a forfeiture of the right to
exercise such Option after termination of that time period. So long as
consistent with the provisions of the Plan, the terms and conditions of any
Option need not be the same as the terms and conditions of any other Option.
Maximum Annual Amount Per Employee
- ----------------------------------
The aggregate fair market value (determined as of the time the Option is
granted) of the stock with respect to which Options are exercisable for the
first time by any employee during any calendar year (under this and any other
plans of the Company or any Subsidiary) shall not exceed $100,000.
Exercise of Options
- -------------------
No Option may be exercised unless the Participant shall have been an employee
of the Company or a Subsidiary at all times during the period beginning on the
date of grant of the Option and ending on the day three (3) months before the
date of such exercise. However, if a Participant is disabled (within the meaning
of Section 37(e)(3) of the Code), no Option may be exercised by such Participant
unless he shall have been an employee of the Company or a Subsidiary at all
times during the period beginning on the
-5-
<PAGE>
date of grant of the Option and ending on the date one (1) year before the date
of such exercise. If an Option is exercised after the death of a Participant by
the estate of such Participant, or by a person who acquired the right to
exercise such option by bequest or inheritance or by reason of the death of such
Participant, the employment requirements of this paragraph shall not apply.
Options may be exercised solely by the Participant during his lifetime or after
his death by the personal representative of the Participant's estate or the
person or persons entitled thereto under his will or under the laws of descent
and distribution.
The purchase price of the Shares as to which an Option is exercised shall be
paid in full in cash and/or other property, including stock of the Company, as
deemed acceptable by the Committee, at the time of the exercise. A Participant
shall not be or have any of the rights or privileges of a shareholder of the
Company in respect of any Shares purchasable upon the exercise of any part of an
Option unless and until certificates representing such Shares shall have been
issued by the Company to such Participant.
Use of Proceeds
- ---------------
The proceeds received by the Company from the sale of stock pursuant to this
Plan will be used for general corporate purposes.
VIII. CAPITAL CHANGES OF THE COMPANY
------------------------------
In the event there is any change in the Common Stock of the Company through
the declaration of stock dividends, or through recapitalization resulting in
stock splits, or combinations or exchanges of shares, or any similar
transactions, the number of Shares subject to Options previously granted and the
number of Shares remaining available for Options and the price per Share of such
Shares shall be appropriately adjusted by the Committee.
In the event the Company shall be a party to any merger, consolidation or
corporate reorganization, as the result of which the Company shall be the
surviving corporation, the rights and duties of the Participants and the Company
shall not be affected in any manner. In the event the Company shall sell all or
substantially all of its assets or shall be a party to any merger, consolidation
or corporate reorganization, as the result of which the Company shall not be the
surviving organization, or in the event any other corporation may make a tender
or exchange offer for stock of the Company (the surviving corporation,
purchaser, or tendering corporation being hereinafter collectively referred to
as the "purchaser," and the transaction being hereinafter referred to as the
"purchase"), then the Board of Directors may, at its election, (i) reach an
agreement with the purchaser that the
-6-
<PAGE>
purchaser will assume the obligations of the Company as to all outstanding
Options; (ii) reach an agreement with the purchaser that the purchaser will
convert each outstanding Option into an option of at least equal value as to
stock of the purchaser; or (iii) not later than thirty (30) days prior to the
effective date of the purchase, notify all Participants that their Options are
accelerated and afford to each Participant a right for ten (10) days after the
date of such notice to exercise any then unexercised portion of all Options held
by him whether or not such Options shall then be exercisable under the terms of
the Plan or his option agreement; and within such ten day period, each such
Participant may exercise any portion of any Option as he may desire.
IX. LIMITATION OF RIGHTS
--------------------
Participation in this Plan is subject to certain limitations:
Limitations
- -----------
Nothing in this Plan shall be construed to:
(1) give any employee of the Company or a Subsidiary any right to be
designated a Participant herein, other than in the sole discretion of the
Committee;
(2) give a Participant any rights whatsoever with respect to Shares
until Options are exercised and Shares are issued to the Participant;
(3) give a Participant or any person any interest in any fund or in
any specific asset or assets of the Company;
(4) limit in any way the right of the Company or a Subsidiary to
terminate a Participant's employment with the Company or a Subsidiary at any
time; or
(5) be evidence of any agreement or understanding, express or implied,
that the Company or a Subsidiary will employ a Participant in any particular
position or at any particular rate of remuneration.
Nonassignability of Options
- ---------------------------
Options shall not be transferable other than by will or by the laws of descent
and distribution, and during a Participant's lifetime shall be exercisable only
by him.
-7-
<PAGE>
Power of the Company
- --------------------
The existence of outstanding Options shall not affect in any way the right or
power of the Company or its subsidiaries or their stockholders to make or
authorize any or all adjustments, recapitalization, reorganization or other
changes in the capital structure of the Company or its Subsidiaries or their
businesses, or any merger or consolidation of the Company or its Subsidiaries or
any issue of bonds, debentures, preferred or the right thereof, or the
dissolution or liquidation of the Company or its Subsidiaries, or any sale or
transfer of all or any part of their assets or business, or any other corporate
act or proceeding whether of a similar character or otherwise.
X. TERMINATION AND AMENDMENT OF THE PLAN
-------------------------------------
The Plan shall terminate upon the expiration of ten years after the Effective
Date and an Option shall not be granted after that date. The Board of Directors
may amend, alter, or discontinue the Plan, but no amendment or alteration shall
be made which would impair the rights of any Participant under any Option
theretofore granted, without his consent, unless his Option Agreement so
provides. The Board of Directors may at any time and from time to time modify or
amend the Plan in such respects as it shall deem advisable in order that the
Options shall be "incentive stock options" as defined in Section 422A of the
Code.
XI. GOVERNMENT REGULATIONS
----------------------
The Plan, and the granting and exercise of Options thereunder, and the
obligation of the Company to sell and deliver Shares under such Options, shall
be subject to all applicable laws, rules and regulations, and to such approvals
by any governmental agencies or national securities exchanges as may be
required.
Purchase for Investment
- -----------------------
Whether or not the Options and Shares covered by the Plan have been registered
under the Securities Act of 1933, as amended, each Participant exercising an
Option may be required by the Company to give a representation in writing that
he is acquiring such Shares for his own account for investment and not with a
view to, or for sale in connection with, the distribution of any part thereof.
Governinq Law
- -------------
The place of administration of the Plan shall be conclusively deemed to be
within the State of Texas; and the validity, construction, interpretation and
effect of the Plan and all rights
-8-
<PAGE>
of any of the persons having or claiming to have any interest in the Plan shall
be governed by the laws of the State of Texas.
IN WITNESS WHEREOF, Energy Insurance International, Inc. has caused the Plan
to be executed by its duly authorized officers in a number of copies, each of
which shall be deemed an original, but all of which shall constitute the same
instrument, effective this 31st day of January 1990.
ENERGY INSURANCE INTERNATIONAL, INC.
By: /s/ John N. Molbeck, Jr.
---------------------------------------
John N. Molbeck, Jr.
President
<PAGE>
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form
S-8) pertaining to the Energy Insurance International, Inc. 1989 Incentive Stock
Option Plan, the Energy Insurance International, Inc. 1990 Incentive Stock
Option Plan and the Aon Stock Award Plan of our reports dated February 9, 1995,
with respect to the consolidated financial statements of Aon Corporation
incorporated by reference in its Annual Report (Form 10-K) for the year ended
December 31, 1994 and the related financial statement schedules included
therein, filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
Chicago, Illinois
May 1, 1995
