|
IRELAND
|
|
Applied For
|
(State or Other Jurisdiction of
|
|
(I.R.S. Employer
|
Incorporation or Organization)
|
|
Identification No.)
|
Large accelerated filer
|
☒
|
|
Accelerated filer
|
☐
|
|
Non-accelerated filer
|
☐
|
|
Smaller reporting company
|
☐
|
|
|
|
|
Emerging growth company
|
☐
|
|
Title of each class
|
|
Trading Symbol(s)
|
|
Name of each exchange
on which registered
|
Class A Ordinary Shares $0.01 nominal value
|
|
AON
|
|
New York Stock Exchange
|
Guarantees of Aon plc’s 2.800% Senior Notes due 2021
|
|
AON21
|
|
New York Stock Exchange
|
Guarantees of Aon plc’s 4.000% Senior Notes due 2023
|
|
AON23
|
|
New York Stock Exchange
|
Guarantees of Aon plc’s 3.500% Senior Notes due 2024
|
|
AON24
|
|
New York Stock Exchange
|
Guarantees of Aon plc’s 3.875% Senior Notes due 2025
|
|
AON25
|
|
New York Stock Exchange
|
Guarantees of Aon plc’s 2.875% Senior Notes due 2026
|
|
AON26
|
|
New York Stock Exchange
|
Guarantees of Aon plc’s 4.250% Senior Notes due 2042
|
|
AON24
|
|
New York Stock Exchange
|
Guarantees of Aon plc’s 4.450% Senior Notes due 2043
|
|
AON43
|
|
New York Stock Exchange
|
Guarantees of Aon plc’s 4.600% Senior Notes due 2044
|
|
AON44
|
|
New York Stock Exchange
|
Guarantees of Aon plc’s 4.750% Senior Notes due 2045
|
|
AON45
|
|
New York Stock Exchange
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(millions, except per share data)
|
|
2020
|
|
2019
|
||||
Revenue
|
|
|
|
|
|
|
||
Total revenue
|
|
$
|
3,219
|
|
|
$
|
3,143
|
|
Expenses
|
|
|
|
|
|
|
||
Compensation and benefits
|
|
1,522
|
|
|
1,584
|
|
||
Information technology
|
|
111
|
|
|
117
|
|
||
Premises
|
|
73
|
|
|
87
|
|
||
Depreciation of fixed assets
|
|
41
|
|
|
40
|
|
||
Amortization of intangible assets
|
|
97
|
|
|
97
|
|
||
Other general expense
|
|
342
|
|
|
346
|
|
||
Total operating expenses
|
|
2,186
|
|
|
2,271
|
|
||
Operating income
|
|
1,033
|
|
|
872
|
|
||
Interest income
|
|
2
|
|
|
2
|
|
||
Interest expense
|
|
(83
|
)
|
|
(72
|
)
|
||
Other income (expense)
|
|
29
|
|
|
—
|
|
||
Income from continuing operations before income taxes
|
|
981
|
|
|
802
|
|
||
Income tax expense
|
|
189
|
|
|
126
|
|
||
Net income from continuing operations
|
|
792
|
|
|
676
|
|
||
Net income (loss) from discontinued operations
|
|
(1
|
)
|
|
—
|
|
||
Net income
|
|
791
|
|
|
676
|
|
||
Less: Net income attributable to noncontrolling interests
|
|
19
|
|
|
17
|
|
||
Net income attributable to Aon shareholders
|
|
$
|
772
|
|
|
$
|
659
|
|
|
|
|
|
|
||||
Basic net income per share attributable to Aon shareholders
|
|
|
|
|
||||
Continuing operations
|
|
$
|
3.31
|
|
|
$
|
2.72
|
|
Discontinued operations
|
|
—
|
|
|
—
|
|
||
Net income
|
|
$
|
3.31
|
|
|
$
|
2.72
|
|
Diluted net income per share attributable to Aon shareholders
|
|
|
|
|
||||
Continuing operations
|
|
$
|
3.29
|
|
|
$
|
2.70
|
|
Discontinued operations
|
|
—
|
|
|
—
|
|
||
Net income
|
|
$
|
3.29
|
|
|
$
|
2.70
|
|
Weighted average ordinary shares outstanding - basic
|
|
233.2
|
|
|
242.2
|
|
||
Weighted average ordinary shares outstanding - diluted
|
|
234.5
|
|
|
243.7
|
|
|
|
Three Months Ended March 31,
|
||||||
(millions)
|
|
2020
|
|
2019
|
||||
Net income
|
|
$
|
791
|
|
|
$
|
676
|
|
Less: Net income attributable to noncontrolling interests
|
|
19
|
|
|
17
|
|
||
Net income attributable to Aon shareholders
|
|
772
|
|
|
659
|
|
||
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
||
Change in fair value of financial instruments
|
|
(5
|
)
|
|
7
|
|
||
Foreign currency translation adjustments
|
|
(397
|
)
|
|
133
|
|
||
Postretirement benefit obligation
|
|
24
|
|
|
31
|
|
||
Total other comprehensive income (loss)
|
|
(378
|
)
|
|
171
|
|
||
Less: Other comprehensive income attributable to noncontrolling interests
|
|
(2
|
)
|
|
2
|
|
||
Total other comprehensive income (loss) attributable to Aon shareholders
|
|
(376
|
)
|
|
169
|
|
||
Comprehensive income attributable to Aon shareholders
|
|
$
|
396
|
|
|
$
|
828
|
|
(millions)
|
|
Shares
|
|
Ordinary
Shares and Additional Paid-in Capital |
|
Retained
Earnings |
|
Accumulated Other
Comprehensive Loss, Net of Tax |
|
Non-
controlling Interests |
|
Total
|
|||||||||||
Balance at December 31, 2019
|
|
232.1
|
|
|
$
|
6,154
|
|
|
$
|
1,254
|
|
|
$
|
(4,033
|
)
|
|
$
|
74
|
|
|
$
|
3,449
|
|
Adoption of new accounting guidance
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|||||
Balance at January 1, 2020
|
|
232.1
|
|
|
$
|
6,154
|
|
|
$
|
1,248
|
|
|
$
|
(4,033
|
)
|
|
$
|
74
|
|
|
$
|
3,443
|
|
Net income
|
|
—
|
|
|
—
|
|
|
772
|
|
|
—
|
|
|
19
|
|
|
791
|
|
|||||
Shares issued - employee stock compensation plans
|
|
1.2
|
|
|
(112
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(112
|
)
|
|||||
Shares purchased
|
|
(2.2
|
)
|
|
—
|
|
|
(463
|
)
|
|
—
|
|
|
—
|
|
|
(463
|
)
|
|||||
Share-based compensation expense
|
|
—
|
|
|
81
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
81
|
|
|||||
Dividends to shareholders ($0.44 per share)
|
|
—
|
|
|
—
|
|
|
(102
|
)
|
|
—
|
|
|
—
|
|
|
(102
|
)
|
|||||
Net change in fair value of financial instruments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
|||||
Net foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(395
|
)
|
|
(2
|
)
|
|
(397
|
)
|
|||||
Net postretirement benefit obligation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24
|
|
|
—
|
|
|
24
|
|
|||||
Balance at March 31, 2020
|
|
231.1
|
|
|
$
|
6,123
|
|
|
$
|
1,455
|
|
|
$
|
(4,409
|
)
|
|
$
|
91
|
|
|
$
|
3,260
|
|
(millions)
|
|
Shares
|
|
Ordinary
Shares and Additional Paid-in Capital |
|
Retained
Earnings |
|
Accumulated Other
Comprehensive Loss, Net of Tax |
|
Non-
controlling Interests |
|
Total
|
|||||||||||
Balance at January 1, 2019
|
|
240.1
|
|
|
$
|
5,967
|
|
|
$
|
2,093
|
|
|
$
|
(3,909
|
)
|
|
$
|
68
|
|
|
$
|
4,219
|
|
Net income
|
|
—
|
|
|
—
|
|
|
659
|
|
|
—
|
|
|
17
|
|
|
676
|
|
|||||
Shares issued - employee stock compensation plans
|
|
1.4
|
|
|
(96
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(96
|
)
|
|||||
Shares purchased
|
|
(0.6
|
)
|
|
—
|
|
|
(101
|
)
|
|
—
|
|
|
—
|
|
|
(101
|
)
|
|||||
Share-based compensation expense
|
|
—
|
|
|
89
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
89
|
|
|||||
Dividends to shareholders ($0.40 per share)
|
|
—
|
|
|
—
|
|
|
(96
|
)
|
|
—
|
|
|
—
|
|
|
(96
|
)
|
|||||
Net change in fair value of financial instruments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
|||||
Net foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
131
|
|
|
2
|
|
|
133
|
|
|||||
Net postretirement benefit obligation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
31
|
|
|
—
|
|
|
31
|
|
|||||
Balance at March 31, 2019
|
|
240.9
|
|
|
$
|
5,960
|
|
|
$
|
2,555
|
|
|
$
|
(3,740
|
)
|
|
$
|
87
|
|
|
$
|
4,862
|
|
|
|
Three Months Ended March 31,
|
||||||
(millions)
|
|
2020
|
|
2019
|
||||
Cash flows from operating activities
|
|
|
|
|
|
|
||
Net income
|
|
$
|
791
|
|
|
$
|
676
|
|
Less: Net income (loss) from discontinued operations
|
|
(1
|
)
|
|
—
|
|
||
Adjustments to reconcile net income to cash provided by operating activities:
|
|
|
|
|
|
|
||
(Gain) loss from sales of businesses, net
|
|
(25
|
)
|
|
(4
|
)
|
||
Depreciation of fixed assets
|
|
41
|
|
|
40
|
|
||
Amortization and impairment of intangible assets
|
|
97
|
|
|
97
|
|
||
Share-based compensation expense
|
|
76
|
|
|
89
|
|
||
Deferred income taxes
|
|
(6
|
)
|
|
(25
|
)
|
||
Change in assets and liabilities:
|
|
|
|
|
|
|
||
Fiduciary receivables
|
|
(808
|
)
|
|
(609
|
)
|
||
Short-term investments — funds held on behalf of clients
|
|
(237
|
)
|
|
(541
|
)
|
||
Fiduciary liabilities
|
|
1,045
|
|
|
1,150
|
|
||
Receivables, net
|
|
(543
|
)
|
|
(458
|
)
|
||
Accounts payable and accrued liabilities
|
|
(275
|
)
|
|
(454
|
)
|
||
Restructuring reserves
|
|
(60
|
)
|
|
(25
|
)
|
||
Current income taxes
|
|
141
|
|
|
118
|
|
||
Pension, other postretirement and postemployment liabilities
|
|
(41
|
)
|
|
(54
|
)
|
||
Other assets and liabilities
|
|
141
|
|
|
74
|
|
||
Cash provided by operating activities
|
|
338
|
|
|
74
|
|
||
Cash flows from investing activities
|
|
|
|
|
|
|
||
Proceeds from investments
|
|
6
|
|
|
12
|
|
||
Payments for investments
|
|
(43
|
)
|
|
(14
|
)
|
||
Net sales (purchases) of short-term investments — non-fiduciary
|
|
(38
|
)
|
|
41
|
|
||
Acquisition of businesses, net of cash acquired
|
|
(334
|
)
|
|
(15
|
)
|
||
Sale of businesses, net of cash sold
|
|
30
|
|
|
6
|
|
||
Capital expenditures
|
|
(59
|
)
|
|
(57
|
)
|
||
Cash used for investing activities
|
|
(438
|
)
|
|
(27
|
)
|
||
Cash flows from financing activities
|
|
|
|
|
|
|
||
Share repurchase
|
|
(463
|
)
|
|
(100
|
)
|
||
Issuance of shares for employee benefit plans
|
|
(112
|
)
|
|
(98
|
)
|
||
Issuance of debt
|
|
2,060
|
|
|
871
|
|
||
Repayment of debt
|
|
(1,341
|
)
|
|
(694
|
)
|
||
Cash dividends to shareholders
|
|
(102
|
)
|
|
(96
|
)
|
||
Noncontrolling interests and other financing activities
|
|
40
|
|
|
(23
|
)
|
||
Cash provided by (used for) financing activities
|
|
82
|
|
|
(140
|
)
|
||
Effect of exchange rates on cash and cash equivalents
|
|
(82
|
)
|
|
37
|
|
||
Net decrease in cash and cash equivalents
|
|
(100
|
)
|
|
(56
|
)
|
||
Cash and cash equivalents at beginning of period
|
|
790
|
|
|
656
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
690
|
|
|
$
|
600
|
|
Supplemental disclosures:
|
|
|
|
|
|
|
||
Interest paid
|
|
$
|
51
|
|
|
$
|
27
|
|
Income taxes paid, net of refunds
|
|
$
|
53
|
|
|
$
|
33
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Commercial Risk Solutions
|
|
$
|
1,146
|
|
|
$
|
1,118
|
|
Reinsurance Solutions
|
|
848
|
|
|
788
|
|
||
Retirement Solutions
|
|
397
|
|
|
420
|
|
||
Health Solutions
|
|
502
|
|
|
486
|
|
||
Data & Analytic Services
|
|
331
|
|
|
336
|
|
||
Elimination
|
|
(5
|
)
|
|
(5
|
)
|
||
Total revenue
|
|
$
|
3,219
|
|
|
$
|
3,143
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
United States
|
|
$
|
1,227
|
|
|
$
|
1,161
|
|
Americas other than United States
|
|
228
|
|
|
226
|
|
||
United Kingdom
|
|
500
|
|
|
452
|
|
||
Europe, Middle East, & Africa other than United Kingdom
|
|
978
|
|
|
1,009
|
|
||
Asia Pacific
|
|
286
|
|
|
295
|
|
||
Total revenue
|
|
$
|
3,219
|
|
|
$
|
3,143
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Balance at beginning of period
|
|
$
|
335
|
|
|
$
|
329
|
|
Additions
|
|
318
|
|
|
346
|
|
||
Amortization
|
|
(416
|
)
|
|
(439
|
)
|
||
Impairment
|
|
—
|
|
|
—
|
|
||
Foreign currency translation and other
|
|
(8
|
)
|
|
—
|
|
||
Balance at end of period
|
|
$
|
229
|
|
|
$
|
236
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Balance at beginning of period
|
|
$
|
171
|
|
|
$
|
156
|
|
Additions
|
|
12
|
|
|
9
|
|
||
Amortization
|
|
(12
|
)
|
|
(11
|
)
|
||
Impairment
|
|
—
|
|
|
—
|
|
||
Foreign currency translation and other
|
|
(4
|
)
|
|
1
|
|
||
Balance at end of period
|
|
$
|
167
|
|
|
$
|
155
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Foreign currency remeasurement
|
|
$
|
42
|
|
|
$
|
(11
|
)
|
Disposal of businesses
|
|
25
|
|
|
5
|
|
||
Pension and other postretirement
|
|
4
|
|
|
4
|
|
||
Equity earnings
|
|
1
|
|
|
1
|
|
||
Financial instruments
|
|
(44
|
)
|
|
1
|
|
||
Other
|
|
1
|
|
|
—
|
|
||
Total
|
|
$
|
29
|
|
|
$
|
—
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020 (1)
|
|
2019
|
||||
Balance at December 31
|
|
$
|
70
|
|
|
$
|
64
|
|
Adoption of new accounting guidance (2)
|
|
7
|
|
|
—
|
|
||
Balance at January 1
|
|
77
|
|
|
64
|
|
||
Provision
|
|
9
|
|
|
8
|
|
||
Accounts written off, net of recoveries
|
|
(8
|
)
|
|
(8
|
)
|
||
Foreign currency translation and other
|
|
3
|
|
|
—
|
|
||
Balance at end of period
|
|
$
|
81
|
|
|
$
|
64
|
|
(1)
|
The Company’s estimate for allowance for credit losses with respect to receivables is based on a combination of factors, including evaluation of forward-looking information, historical write-offs, aging of balances, and other qualitative and quantitative analyses. Refer to Note 2 “Accounting Principles and Practices” for further information.
|
(2)
|
The allowance for doubtful accounts resulted in a $7 million charge from the adoption of the new accounting standard on the measurement of credit losses. After tax impacts, this resulted in a $6 million decrease to Retained earnings. Refer to Note 2 “Accounting Principles and Practices” for further information.
|
As of
|
March 31,
2020 |
|
December 31,
2019 |
||||
Costs to fulfill contracts with customers (1)
|
$
|
229
|
|
|
$
|
335
|
|
Prepaid expenses
|
156
|
|
|
97
|
|
||
Taxes receivable
|
79
|
|
|
88
|
|
||
Other (2)
|
66
|
|
|
82
|
|
||
Total
|
$
|
530
|
|
|
$
|
602
|
|
(1)
|
Refer to Note 3 “Revenue from Contracts with Customers” for further information.
|
(2)
|
December 31, 2019 includes $4 million previously classified as “Receivables from the Divested Business”.
|
As of
|
March 31,
2020 |
|
December 31,
2019 |
||||
Costs to obtain contracts with customers (1)
|
$
|
167
|
|
|
$
|
171
|
|
Taxes receivable
|
101
|
|
|
102
|
|
||
Leases
|
93
|
|
|
100
|
|
||
Investments
|
52
|
|
|
53
|
|
||
Other
|
120
|
|
|
144
|
|
||
Total
|
$
|
533
|
|
|
$
|
570
|
|
(1)
|
Refer to Note 3 “Revenue from Contracts with Customers” for further information.
|
As of
|
March 31,
2020 |
|
December 31,
2019 |
||||
Deferred revenue (1)
|
$
|
309
|
|
|
$
|
270
|
|
Leases
|
200
|
|
|
210
|
|
||
Taxes payable
|
196
|
|
|
93
|
|
||
Other
|
572
|
|
|
513
|
|
||
Total
|
$
|
1,277
|
|
|
$
|
1,086
|
|
(1)
|
During the three months ended March 31, 2020, $117 million was recognized in the Condensed Consolidated Statement of Income. During the 12 months ended December 31, 2019, $532 million was recognized in the Consolidated Statement of Income.
|
As of
|
March 31,
2020 |
|
December 31,
2019 |
||||
Taxes payable (1)
|
$
|
544
|
|
|
$
|
525
|
|
Leases
|
74
|
|
|
76
|
|
||
Deferred revenue
|
72
|
|
|
62
|
|
||
Compensation and benefits
|
41
|
|
|
49
|
|
||
Other
|
199
|
|
|
165
|
|
||
Total
|
$
|
930
|
|
|
$
|
877
|
|
(1)
|
Includes $145 million for the non-current portion of the one-time mandatory transition tax on accumulated foreign earnings as of March 31, 2020 and December 31, 2019.
|
Consideration Transferred
|
|
Three Months Ended March 31, 2020
|
||
Cash
|
|
$
|
351
|
|
Deferred, contingent, and other consideration
|
|
35
|
|
|
Aggregate consideration transferred
|
|
$
|
386
|
|
|
|
|
||
Assets acquired
|
|
|
||
Cash and cash equivalents
|
|
$
|
17
|
|
Receivables
|
|
7
|
|
|
Goodwill
|
|
303
|
|
|
Intangible assets
|
|
74
|
|
|
Current assets
|
|
2
|
|
|
Non-current assets
|
|
5
|
|
|
Total assets acquired
|
|
408
|
|
|
Liabilities assumed
|
|
|
||
Current liabilities
|
|
11
|
|
|
Non-current liabilities
|
|
11
|
|
|
Total liabilities assumed
|
|
22
|
|
|
Net assets acquired
|
|
$
|
386
|
|
Balance as of December 31, 2019
|
$
|
8,165
|
|
Goodwill related to current year acquisitions
|
303
|
|
|
Goodwill related to disposals
|
(3
|
)
|
|
Goodwill related to prior year acquisitions
|
—
|
|
|
Foreign currency translation
|
(172
|
)
|
|
Balance as of March 31, 2020
|
$
|
8,293
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||||||||||
|
Gross Carrying Amount
|
|
Accumulated
Amortization and Impairment
|
|
Net Carrying Amount
|
|
Gross Carrying Amount
|
|
Accumulated
Amortization and Impairment |
|
Net Carrying Amount
|
||||||||||||
Customer-related and contract-based
|
$
|
2,227
|
|
|
$
|
1,590
|
|
|
$
|
637
|
|
|
$
|
2,264
|
|
|
$
|
1,600
|
|
|
$
|
664
|
|
Tradenames
|
1,026
|
|
|
1,005
|
|
|
21
|
|
|
1,029
|
|
|
956
|
|
|
73
|
|
||||||
Technology and other
|
408
|
|
|
320
|
|
|
88
|
|
|
380
|
|
|
334
|
|
|
46
|
|
||||||
Total
|
$
|
3,661
|
|
|
$
|
2,915
|
|
|
$
|
746
|
|
|
$
|
3,673
|
|
|
$
|
2,890
|
|
|
$
|
783
|
|
Remainder of 2020
|
$
|
139
|
|
2021
|
136
|
|
|
2022
|
96
|
|
|
2023
|
85
|
|
|
2024
|
69
|
|
|
2025
|
51
|
|
|
Thereafter
|
170
|
|
|
Total
|
$
|
746
|
|
As of
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Commercial paper outstanding
|
|
$
|
833
|
|
|
$
|
112
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Weighted average commercial paper outstanding
|
|
$
|
456
|
|
|
$
|
323
|
|
Weighted average interest rate of commercial paper outstanding
|
|
0.96
|
%
|
|
0.49
|
%
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Shares repurchased
|
2.2
|
|
|
0.6
|
|
||
Average price per share
|
$
|
212.78
|
|
|
$
|
161.16
|
|
Costs recorded to retained earnings
|
|
|
|
||||
Total repurchase cost
|
$
|
461
|
|
|
$
|
100
|
|
Additional associated costs
|
2
|
|
|
1
|
|
||
Total costs recorded to retained earnings
|
$
|
463
|
|
|
$
|
101
|
|
|
Three Months Ended March 31,
|
||||
|
2020
|
|
2019
|
||
Basic weighted average ordinary shares outstanding
|
233.2
|
|
|
242.2
|
|
Dilutive effect of potentially issuable shares
|
1.3
|
|
|
1.5
|
|
Diluted weighted average ordinary shares outstanding
|
234.5
|
|
|
243.7
|
|
|
Change in Fair Value of Financial Instruments (1)
|
|
Foreign Currency Translation Adjustments
|
|
Postretirement Benefit Obligation (2)
|
|
Total
|
||||||||
Balance at December 31, 2019
|
$
|
(12
|
)
|
|
$
|
(1,305
|
)
|
|
$
|
(2,716
|
)
|
|
$
|
(4,033
|
)
|
Other comprehensive income (loss) before reclassifications, net
|
(9
|
)
|
|
(395
|
)
|
|
1
|
|
|
(403
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|||||
Amounts reclassified from accumulated other comprehensive income
|
5
|
|
|
—
|
|
|
30
|
|
|
35
|
|
||||
Tax expense
|
(1
|
)
|
|
—
|
|
|
(7
|
)
|
|
(8
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income, net (3)
|
4
|
|
|
—
|
|
|
23
|
|
|
27
|
|
||||
Net current period other comprehensive income (loss)
|
(5
|
)
|
|
(395
|
)
|
|
24
|
|
|
(376
|
)
|
||||
Balance at March 31, 2020
|
$
|
(17
|
)
|
|
$
|
(1,700
|
)
|
|
$
|
(2,692
|
)
|
|
$
|
(4,409
|
)
|
(1)
|
Reclassifications from this category included in Accumulated other comprehensive loss are recorded in Revenue, Interest expense, and Compensation and benefits in the Condensed Consolidated Statements of Income. Refer to Note 14 “Derivatives and Hedging” for further information regarding the Company’s derivative and hedging activity.
|
(2)
|
Reclassifications from this category included in Accumulated other comprehensive loss are recorded in Other income (expense) in the Condensed Consolidated Statements of Income.
|
(3)
|
It is the Company’s policy to release income tax effects from accumulated other comprehensive loss using the portfolio approach.
|
|
Change in Fair Value of Financial Instruments (1)
|
|
Foreign Currency Translation Adjustments
|
|
Postretirement Benefit Obligation (2)
|
|
Total
|
||||||||
Balance at December 31, 2018
|
$
|
(15
|
)
|
|
$
|
(1,319
|
)
|
|
$
|
(2,575
|
)
|
|
$
|
(3,909
|
)
|
Other comprehensive income before reclassifications, net
|
4
|
|
|
131
|
|
|
11
|
|
|
146
|
|
||||
Amounts reclassified from accumulated other comprehensive income
|
|
|
|
|
|
|
|
||||||||
Amounts reclassified from accumulated other comprehensive income
|
5
|
|
|
—
|
|
|
26
|
|
|
31
|
|
||||
Tax expense
|
(2
|
)
|
|
—
|
|
|
(6
|
)
|
|
(8
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income, net (3)
|
3
|
|
|
—
|
|
|
20
|
|
|
23
|
|
||||
Net current period other comprehensive income
|
7
|
|
|
131
|
|
|
31
|
|
|
169
|
|
||||
Balance at March 31, 2019
|
$
|
(8
|
)
|
|
$
|
(1,188
|
)
|
|
$
|
(2,544
|
)
|
|
$
|
(3,740
|
)
|
(1)
|
Reclassifications from this category included in Accumulated other comprehensive loss are recorded in Revenue, Interest expense, and Compensation and benefits in the Condensed Consolidated Statements of Income. Refer to Note 14 “Derivatives and Hedging” for further information regarding the Company’s derivative and hedging activity.
|
(2)
|
Reclassifications from this category included in Accumulated other comprehensive loss are recorded in Other income (expense) in the Condensed Consolidated Statements of Income.
|
(3)
|
It is the Company’s policy to release income tax effects from accumulated other comprehensive loss using the portfolio approach.
|
|
Three Months Ended March 31,
|
||||||||||||||||||||||
|
U.K.
|
|
U.S.
|
|
Other
|
||||||||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||||||
Service cost
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest cost
|
22
|
|
|
28
|
|
|
21
|
|
|
27
|
|
|
4
|
|
|
7
|
|
||||||
Expected return on plan assets, net of administration expenses
|
(39
|
)
|
|
(49
|
)
|
|
(33
|
)
|
|
(34
|
)
|
|
(8
|
)
|
|
(10
|
)
|
||||||
Amortization of prior-service cost
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
||||||
Amortization of net actuarial loss
|
7
|
|
|
7
|
|
|
17
|
|
|
13
|
|
|
3
|
|
|
3
|
|
||||||
Total net periodic (benefit) cost
|
$
|
(10
|
)
|
|
$
|
(13
|
)
|
|
$
|
5
|
|
|
$
|
7
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Contributions to U.K. pension plans
|
|
$
|
2
|
|
|
$
|
23
|
|
Contributions to U.S. pension plans
|
|
31
|
|
|
17
|
|
||
Contributions to other major pension plans
|
|
2
|
|
|
7
|
|
||
Total contributions
|
|
$
|
35
|
|
|
$
|
47
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Restricted share units (“RSUs”)
|
$
|
58
|
|
|
$
|
63
|
|
Performance share awards (“PSAs”)
|
14
|
|
|
23
|
|
||
Employee share purchase plans
|
4
|
|
|
3
|
|
||
Total share-based compensation expense
|
$
|
76
|
|
|
$
|
89
|
|
|
Three Months Ended March 31,
|
||||||||||||
|
2020
|
|
2019
|
||||||||||
|
Shares
|
|
Fair Value (1)
|
|
Shares
|
|
Fair Value (1)
|
||||||
Non-vested at beginning of period
|
3,634
|
|
|
$
|
143
|
|
|
4,208
|
|
|
$
|
120
|
|
Granted
|
432
|
|
|
$
|
179
|
|
|
517
|
|
|
$
|
170
|
|
Vested
|
(583
|
)
|
|
$
|
141
|
|
|
(677
|
)
|
|
$
|
117
|
|
Forfeited
|
(79
|
)
|
|
$
|
146
|
|
|
(41
|
)
|
|
$
|
121
|
|
Non-vested at end of period
|
3,403
|
|
|
$
|
147
|
|
|
4,007
|
|
|
$
|
127
|
|
(1)
|
Represents per share weighted average fair value of award at date of grant.
|
|
March 31,
2020 |
|
December 31,
2019 |
|
December 31,
2018 |
||||||
Target PSAs granted during period
|
487
|
|
|
467
|
|
|
564
|
|
|||
Weighted average fair value per share at date of grant
|
$
|
160
|
|
|
$
|
165
|
|
|
$
|
134
|
|
Number of shares that would be issued based on current performance levels
|
487
|
|
|
451
|
|
|
818
|
|
|||
Unamortized expense, based on current performance levels
|
$
|
78
|
|
|
$
|
42
|
|
|
$
|
24
|
|
|
Notional Amount
|
|
Net Amount of Derivative Assets
Presented in the Statements of Financial Position (1)
|
|
Net Amount of Derivative Liabilities
Presented in the Statements of Financial Position (2)
|
||||||||||||||||||
|
March 31,
2020 |
|
December 31,
2019 |
|
March 31,
2020 |
|
December 31,
2019 |
|
March 31,
2020 |
|
December 31,
2019 |
||||||||||||
Foreign exchange contracts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Accounted for as hedges
|
$
|
537
|
|
|
$
|
579
|
|
|
$
|
8
|
|
|
$
|
16
|
|
|
$
|
(3
|
)
|
|
$
|
1
|
|
Not accounted for as hedges (3)
|
385
|
|
|
297
|
|
|
4
|
|
|
2
|
|
|
(1
|
)
|
|
—
|
|
||||||
Total
|
$
|
922
|
|
|
$
|
876
|
|
|
$
|
12
|
|
|
$
|
18
|
|
|
$
|
(4
|
)
|
|
$
|
1
|
|
(1)
|
Included within Other current assets ($7 million at March 31, 2020 and $7 million at December 31, 2019) or Other non-current assets ($5 million at March 31, 2020 and $11 million at December 31, 2019).
|
(2)
|
Included within Other current liabilities ($3 million at March 31, 2020 and $1 million at December 31, 2019) or Other non-current liabilities ($1 million at March 31, 2020 and $0 million at December 31, 2019).
|
(3)
|
These contracts typically are for 30-day durations and executed close to the last day of the most recent reporting month, thereby resulting in nominal fair values at the balance sheet date.
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
(Loss) Gain recognized in Accumulated other comprehensive loss
|
$
|
(11
|
)
|
|
$
|
4
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Total revenue
|
|
$
|
(4
|
)
|
|
$
|
(4
|
)
|
Interest expense
|
|
(1
|
)
|
|
(1
|
)
|
||
Total
|
|
$
|
(5
|
)
|
|
$
|
(5
|
)
|
•
|
Level 1 — observable inputs such as quoted prices for identical assets in active markets;
|
•
|
Level 2 — inputs other than quoted prices for identical assets in active markets, that are observable either directly or indirectly; and
|
•
|
Level 3 — unobservable inputs in which there is little or no market data which requires the use of valuation techniques and the development of assumptions.
|
|
|
|
Fair Value Measurements Using
|
||||||||||||
|
Balance at March 31, 2020
|
|
Quoted Prices in Active Markets for Identical Assets (Level 1)
|
|
Significant Other Observable Inputs (Level 2)
|
|
Significant Unobservable Inputs (Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds (1)
|
$
|
2,252
|
|
|
$
|
2,252
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Other investments
|
|
|
|
|
|
|
|
|
|
|
|
||||
Government bonds
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
Equity investments
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
Derivatives (2)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross foreign exchange contracts
|
$
|
13
|
|
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||
Derivatives (2)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross foreign exchange contracts
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
—
|
|
|
|
|
Fair Value Measurements Using
|
||||||||||||
|
Balance at December 31, 2019
|
|
Quoted Prices in Active Markets for Identical Assets (Level 1)
|
|
Significant Other Observable Inputs (Level 2)
|
|
Significant Unobservable Inputs (Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds (1)
|
$
|
2,007
|
|
|
$
|
2,007
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Other investments
|
|
|
|
|
|
|
|
|
|
|
|
||||
Government bonds
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
Equity investments
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
Derivatives (2)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross foreign exchange contracts
|
$
|
21
|
|
|
$
|
—
|
|
|
$
|
21
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
0
|
|
|
|
|
||||
Derivatives (2)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross foreign exchange contracts
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
—
|
|
(1)
|
Included within Fiduciary assets or Short-term investments in the Condensed Consolidated Statements of Financial Position, depending on their nature and initial maturity.
|
(2)
|
Refer to Note 14 “Derivatives and Hedging” for additional information regarding the Company’s derivatives and hedging activity.
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
Current portion of long-term debt
|
$
|
999
|
|
|
$
|
1,004
|
|
|
$
|
600
|
|
|
$
|
614
|
|
Long-term debt
|
$
|
6,227
|
|
|
$
|
6,837
|
|
|
$
|
6,627
|
|
|
$
|
7,442
|
|
|
|
Three Months Ended March 31, 2020
|
||||||||||||||||||||||||||
(millions)
|
|
Aon Ireland
|
|
Aon UK
|
|
Aon Global Holdings Limited
|
|
Aon Corporation
|
|
Other Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated
|
||||||||||||||
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total revenue
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,219
|
|
|
$
|
—
|
|
|
$
|
3,219
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Compensation and benefits
|
|
—
|
|
|
12
|
|
|
—
|
|
|
(12
|
)
|
|
1,522
|
|
|
—
|
|
|
1,522
|
|
|||||||
Information technology
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
111
|
|
|
—
|
|
|
111
|
|
|||||||
Premises
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
68
|
|
|
—
|
|
|
73
|
|
|||||||
Depreciation of fixed assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
41
|
|
|
—
|
|
|
41
|
|
|||||||
Amortization and impairment of intangible assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
97
|
|
|
—
|
|
|
97
|
|
|||||||
Other general expense
|
|
—
|
|
|
26
|
|
|
—
|
|
|
1
|
|
|
315
|
|
|
—
|
|
|
342
|
|
|||||||
Total operating expenses
|
|
—
|
|
|
38
|
|
|
—
|
|
|
(6
|
)
|
|
2,154
|
|
|
—
|
|
|
2,186
|
|
|||||||
Operating income (loss)
|
|
—
|
|
|
(38
|
)
|
|
—
|
|
|
6
|
|
|
1,065
|
|
|
—
|
|
|
1,033
|
|
|||||||
Interest income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
|
14
|
|
|
(22
|
)
|
|
2
|
|
|||||||
Interest expense
|
|
—
|
|
|
(54
|
)
|
|
(11
|
)
|
|
(39
|
)
|
|
(1
|
)
|
|
22
|
|
|
(83
|
)
|
|||||||
Intercompany interest income (expense)
|
|
—
|
|
|
8
|
|
|
—
|
|
|
(113
|
)
|
|
105
|
|
|
—
|
|
|
—
|
|
|||||||
Intercompany other income (expense)
|
|
—
|
|
|
81
|
|
|
—
|
|
|
(128
|
)
|
|
47
|
|
|
—
|
|
|
—
|
|
|||||||
Other income (expense)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42
|
)
|
|
72
|
|
|
(1
|
)
|
|
29
|
|
|||||||
Income (loss) from continuing operations before income taxes
|
|
—
|
|
|
(3
|
)
|
|
(11
|
)
|
|
(306
|
)
|
|
1,302
|
|
|
(1
|
)
|
|
981
|
|
|||||||
Income tax expense (benefit)
|
|
—
|
|
|
(17
|
)
|
|
(2
|
)
|
|
(48
|
)
|
|
256
|
|
|
—
|
|
|
189
|
|
|||||||
Net income (loss) from continuing operations
|
|
—
|
|
|
14
|
|
|
(9
|
)
|
|
(258
|
)
|
|
1,046
|
|
|
(1
|
)
|
|
792
|
|
|||||||
Net income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||||||
Net income (loss) before equity in earnings of subsidiaries
|
|
—
|
|
|
14
|
|
|
(9
|
)
|
|
(258
|
)
|
|
1,045
|
|
|
(1
|
)
|
|
791
|
|
|||||||
Equity in earnings of subsidiaries
|
|
773
|
|
|
759
|
|
|
614
|
|
|
862
|
|
|
—
|
|
|
(3,008
|
)
|
|
—
|
|
|||||||
Net income
|
|
773
|
|
|
773
|
|
|
605
|
|
|
604
|
|
|
1,045
|
|
|
(3,009
|
)
|
|
791
|
|
|||||||
Less: Net income attributable to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19
|
|
|
—
|
|
|
19
|
|
|||||||
Net income attributable to Aon shareholders
|
|
$
|
773
|
|
|
$
|
773
|
|
|
$
|
605
|
|
|
$
|
604
|
|
|
$
|
1,026
|
|
|
$
|
(3,009
|
)
|
|
$
|
772
|
|
|
|
Three Months Ended March 31, 2019
|
||||||||||||||||||||||||||
(millions)
|
|
Aon Ireland
|
|
Aon UK
|
|
Aon Global Holdings Limited
|
|
Aon Corporation
|
|
Other Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated
|
||||||||||||||
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total revenue
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,143
|
|
|
$
|
—
|
|
|
$
|
3,143
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Compensation and benefits
|
|
—
|
|
|
20
|
|
|
—
|
|
|
8
|
|
|
1,556
|
|
|
—
|
|
|
1,584
|
|
|||||||
Information technology
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
117
|
|
|
—
|
|
|
117
|
|
|||||||
Premises
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
83
|
|
|
—
|
|
|
87
|
|
|||||||
Depreciation of fixed assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40
|
|
|
—
|
|
|
40
|
|
|||||||
Amortization and impairment of intangible assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
97
|
|
|
—
|
|
|
97
|
|
|||||||
Other general expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
345
|
|
|
—
|
|
|
346
|
|
|||||||
Total operating expenses
|
|
—
|
|
|
20
|
|
|
—
|
|
|
13
|
|
|
2,238
|
|
|
—
|
|
|
2,271
|
|
|||||||
Operating income (loss)
|
|
—
|
|
|
(20
|
)
|
|
—
|
|
|
(13
|
)
|
|
905
|
|
|
—
|
|
|
872
|
|
|||||||
Interest income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
20
|
|
|
(27
|
)
|
|
2
|
|
|||||||
Interest expense
|
|
—
|
|
|
(46
|
)
|
|
(24
|
)
|
|
(28
|
)
|
|
(1
|
)
|
|
27
|
|
|
(72
|
)
|
|||||||
Intercompany interest income (expense)
|
|
—
|
|
|
4
|
|
|
—
|
|
|
(116
|
)
|
|
112
|
|
|
—
|
|
|
—
|
|
|||||||
Intercompany other income (expense)
|
|
—
|
|
|
31
|
|
|
—
|
|
|
(94
|
)
|
|
63
|
|
|
—
|
|
|
—
|
|
|||||||
Other income (expense)
|
|
—
|
|
|
5
|
|
|
—
|
|
|
(11
|
)
|
|
8
|
|
|
(2
|
)
|
|
—
|
|
|||||||
Income (loss) from continuing operations before income taxes
|
|
—
|
|
|
(26
|
)
|
|
(24
|
)
|
|
(253
|
)
|
|
1,107
|
|
|
(2
|
)
|
|
802
|
|
|||||||
Income tax expense (benefit)
|
|
—
|
|
|
(5
|
)
|
|
(5
|
)
|
|
(42
|
)
|
|
178
|
|
|
—
|
|
|
126
|
|
|||||||
Net income (loss) from continuing operations
|
|
—
|
|
|
(21
|
)
|
|
(19
|
)
|
|
(211
|
)
|
|
929
|
|
|
(2
|
)
|
|
676
|
|
|||||||
Net income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net income (loss) before equity in earnings of subsidiaries
|
|
—
|
|
|
(21
|
)
|
|
(19
|
)
|
|
(211
|
)
|
|
929
|
|
|
(2
|
)
|
|
676
|
|
|||||||
Equity in earnings of subsidiaries
|
|
—
|
|
|
682
|
|
|
619
|
|
|
724
|
|
|
—
|
|
|
(2,025
|
)
|
|
—
|
|
|||||||
Net income
|
|
—
|
|
|
661
|
|
|
600
|
|
|
513
|
|
|
929
|
|
|
(2,027
|
)
|
|
676
|
|
|||||||
Less: Net income attributable to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
17
|
|
|||||||
Net income attributable to Aon shareholders
|
|
$
|
—
|
|
|
$
|
661
|
|
|
$
|
600
|
|
|
$
|
513
|
|
|
$
|
912
|
|
|
$
|
(2,027
|
)
|
|
$
|
659
|
|
|
|
Three Months Ended March 31, 2020
|
||||||||||||||||||||||||||
(millions)
|
|
Aon Ireland
|
|
Aon UK
|
|
Aon Global Holdings Limited
|
|
Aon Corporation
|
|
Other Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated
|
||||||||||||||
Net income
|
|
$
|
773
|
|
|
$
|
773
|
|
|
$
|
605
|
|
|
$
|
604
|
|
|
$
|
1,045
|
|
|
$
|
(3,009
|
)
|
|
$
|
791
|
|
Less: Net income attributable to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19
|
|
|
—
|
|
|
19
|
|
|||||||
Net income attributable to Aon shareholders
|
|
773
|
|
|
773
|
|
|
605
|
|
|
604
|
|
|
1,026
|
|
|
(3,009
|
)
|
|
772
|
|
|||||||
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Change in fair value of financial instruments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(3
|
)
|
|
—
|
|
|
(5
|
)
|
|||||||
Foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(398
|
)
|
|
1
|
|
|
(397
|
)
|
|||||||
Postretirement benefit obligation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|
11
|
|
|
—
|
|
|
24
|
|
|||||||
Total other comprehensive income (loss)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|
(390
|
)
|
|
1
|
|
|
(378
|
)
|
|||||||
Equity in other comprehensive income (loss) of subsidiaries, net of tax
|
|
(377
|
)
|
|
(377
|
)
|
|
(370
|
)
|
|
(381
|
)
|
|
—
|
|
|
1,505
|
|
|
—
|
|
|||||||
Less: Other comprehensive loss attributable to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|||||||
Total other comprehensive income (loss) attributable to Aon shareholders
|
|
(377
|
)
|
|
(377
|
)
|
|
(370
|
)
|
|
(370
|
)
|
|
(388
|
)
|
|
1,506
|
|
|
(376
|
)
|
|||||||
Comprehensive income attributable to Aon shareholders
|
|
$
|
396
|
|
|
$
|
396
|
|
|
$
|
235
|
|
|
$
|
234
|
|
|
$
|
638
|
|
|
$
|
(1,503
|
)
|
|
$
|
396
|
|
|
|
Three Months Ended March 31, 2019
|
||||||||||||||||||||||||||
(millions)
|
|
Aon Ireland
|
|
Aon UK
|
|
Aon Global Holdings Limited
|
|
Aon Corporation
|
|
Other Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated
|
||||||||||||||
Net income
|
|
$
|
—
|
|
|
$
|
661
|
|
|
$
|
600
|
|
|
$
|
513
|
|
|
$
|
929
|
|
|
$
|
(2,027
|
)
|
|
$
|
676
|
|
Less: Net income attributable to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
17
|
|
|||||||
Net income attributable to Aon shareholders
|
|
—
|
|
|
661
|
|
|
600
|
|
|
513
|
|
|
912
|
|
|
(2,027
|
)
|
|
659
|
|
|||||||
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Change in fair value of financial instruments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
5
|
|
|
—
|
|
|
7
|
|
|||||||
Foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
131
|
|
|
2
|
|
|
133
|
|
|||||||
Postretirement benefit obligation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|
9
|
|
|
—
|
|
|
31
|
|
|||||||
Total other comprehensive income (loss)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24
|
|
|
145
|
|
|
2
|
|
|
171
|
|
|||||||
Equity in other comprehensive income (loss) of subsidiaries, net of tax
|
|
—
|
|
|
167
|
|
|
139
|
|
|
115
|
|
|
—
|
|
|
(421
|
)
|
|
—
|
|
|||||||
Less: Other comprehensive loss attributable to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||||
Total other comprehensive income (loss) attributable to Aon shareholders
|
|
—
|
|
|
167
|
|
|
139
|
|
|
139
|
|
|
143
|
|
|
(419
|
)
|
|
169
|
|
|||||||
Comprehensive income attributable to Aon shareholders
|
|
$
|
—
|
|
|
$
|
828
|
|
|
$
|
739
|
|
|
$
|
652
|
|
|
$
|
1,055
|
|
|
$
|
(2,446
|
)
|
|
$
|
828
|
|
|
|
As of March 31, 2020
|
||||||||||||||||||||||||||
(millions)
|
|
Aon Ireland
|
|
Aon UK
|
|
Aon Global Holdings Limited
|
|
Aon Corporation
|
|
Other Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Current assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash and cash equivalents
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
36
|
|
|
$
|
194
|
|
|
$
|
1,698
|
|
|
$
|
(1,238
|
)
|
|
$
|
690
|
|
Short-term investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
57
|
|
|
113
|
|
|
—
|
|
|
170
|
|
|||||||
Receivables, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,554
|
|
|
—
|
|
|
3,554
|
|
|||||||
Fiduciary assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,401
|
|
|
—
|
|
|
12,401
|
|
|||||||
Current intercompany receivables
|
|
—
|
|
|
208
|
|
|
90
|
|
|
2,710
|
|
|
14,875
|
|
|
(17,883
|
)
|
|
—
|
|
|||||||
Other current assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
526
|
|
|
—
|
|
|
530
|
|
|||||||
Total current assets
|
|
—
|
|
|
208
|
|
|
126
|
|
|
2,965
|
|
|
33,167
|
|
|
(19,121
|
)
|
|
17,345
|
|
|||||||
Goodwill
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,293
|
|
|
—
|
|
|
8,293
|
|
|||||||
Intangible assets, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
746
|
|
|
—
|
|
|
746
|
|
|||||||
Fixed assets, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
666
|
|
|
—
|
|
|
666
|
|
|||||||
Operating lease right-of-use assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
103
|
|
|
794
|
|
|
—
|
|
|
897
|
|
|||||||
Deferred tax assets
|
|
—
|
|
|
89
|
|
|
4
|
|
|
589
|
|
|
150
|
|
|
(194
|
)
|
|
638
|
|
|||||||
Prepaid pension
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
1,157
|
|
|
—
|
|
|
1,164
|
|
|||||||
Non-current intercompany receivables
|
|
—
|
|
|
397
|
|
|
—
|
|
|
261
|
|
|
7,044
|
|
|
(7,702
|
)
|
|
—
|
|
|||||||
Other non-current assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25
|
|
|
508
|
|
|
—
|
|
|
533
|
|
|||||||
Investment in subsidiary
|
|
3,169
|
|
|
8,650
|
|
|
8,871
|
|
|
19,973
|
|
|
—
|
|
|
(40,663
|
)
|
|
—
|
|
|||||||
Total assets
|
|
$
|
3,169
|
|
|
$
|
9,344
|
|
|
$
|
9,001
|
|
|
$
|
23,923
|
|
|
$
|
52,525
|
|
|
$
|
(67,680
|
)
|
|
$
|
30,282
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Liabilities and equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Accounts payable and accrued liabilities
|
|
$
|
—
|
|
|
$
|
1,345
|
|
|
$
|
—
|
|
|
$
|
49
|
|
|
$
|
1,393
|
|
|
$
|
(1,238
|
)
|
|
$
|
1,549
|
|
Short-term debt and current portion of long-term debt
|
|
—
|
|
|
696
|
|
|
—
|
|
|
1,136
|
|
|
52
|
|
|
—
|
|
|
1,884
|
|
|||||||
Fiduciary liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,401
|
|
|
—
|
|
|
12,401
|
|
|||||||
Current intercompany payables
|
|
—
|
|
|
310
|
|
|
61
|
|
|
16,321
|
|
|
1,191
|
|
|
(17,883
|
)
|
|
—
|
|
|||||||
Other current liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
82
|
|
|
1,195
|
|
|
—
|
|
|
1,277
|
|
|||||||
Total current liabilities
|
|
—
|
|
|
2,351
|
|
|
61
|
|
|
17,588
|
|
|
16,232
|
|
|
(19,121
|
)
|
|
17,111
|
|
|||||||
Long-term debt
|
|
—
|
|
|
3,822
|
|
|
—
|
|
|
2,405
|
|
|
—
|
|
|
—
|
|
|
6,227
|
|
|||||||
Non-current operating lease liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
136
|
|
|
774
|
|
|
—
|
|
|
910
|
|
|||||||
Deferred tax liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
383
|
|
|
(194
|
)
|
|
189
|
|
|||||||
Pension, other postretirement, and postemployment liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,287
|
|
|
368
|
|
|
—
|
|
|
1,655
|
|
|||||||
Non-current intercompany payables
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,210
|
|
|
492
|
|
|
(7,702
|
)
|
|
—
|
|
|||||||
Other non-current liabilities
|
|
—
|
|
|
2
|
|
|
—
|
|
|
115
|
|
|
813
|
|
|
—
|
|
|
930
|
|
|||||||
Total liabilities
|
|
—
|
|
|
6,175
|
|
|
61
|
|
|
28,741
|
|
|
19,062
|
|
|
(27,017
|
)
|
|
27,022
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total Aon shareholders’ equity
|
|
3,169
|
|
|
3,169
|
|
|
8,940
|
|
|
(4,818
|
)
|
|
33,372
|
|
|
(40,663
|
)
|
|
3,169
|
|
|||||||
Noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
91
|
|
|
—
|
|
|
91
|
|
|||||||
Total equity
|
|
3,169
|
|
|
3,169
|
|
|
8,940
|
|
|
(4,818
|
)
|
|
33,463
|
|
|
(40,663
|
)
|
|
3,260
|
|
|||||||
Total liabilities and equity
|
|
$
|
3,169
|
|
|
$
|
9,344
|
|
|
$
|
9,001
|
|
|
$
|
23,923
|
|
|
$
|
52,525
|
|
|
$
|
(67,680
|
)
|
|
$
|
30,282
|
|
|
|
As of December 31, 2019
|
||||||||||||||||||||||||||
(millions)
|
|
Aon Ireland
|
|
Aon UK
|
|
Aon Global Holdings Limited
|
|
Aon Corporation
|
|
Other Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Current assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash and cash equivalents
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,271
|
|
|
$
|
2,619
|
|
|
$
|
(4,100
|
)
|
|
$
|
790
|
|
Short-term investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
28
|
|
|
110
|
|
|
—
|
|
|
138
|
|
|||||||
Receivables, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,112
|
|
|
—
|
|
|
3,112
|
|
|||||||
Fiduciary assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,834
|
|
|
—
|
|
|
11,834
|
|
|||||||
Current intercompany receivables
|
|
—
|
|
|
246
|
|
|
89
|
|
|
1,214
|
|
|
12,710
|
|
|
(14,259
|
)
|
|
—
|
|
|||||||
Other current assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
595
|
|
|
—
|
|
|
602
|
|
|||||||
Total current assets
|
|
—
|
|
|
246
|
|
|
89
|
|
|
3,520
|
|
|
30,980
|
|
|
(18,359
|
)
|
|
16,476
|
|
|||||||
Goodwill
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,165
|
|
|
—
|
|
|
8,165
|
|
|||||||
Intangible assets, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
783
|
|
|
—
|
|
|
783
|
|
|||||||
Fixed assets, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
621
|
|
|
—
|
|
|
621
|
|
|||||||
Operating lease right-of-use assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
110
|
|
|
819
|
|
|
—
|
|
|
929
|
|
|||||||
Deferred tax assets
|
|
—
|
|
|
89
|
|
|
4
|
|
|
577
|
|
|
165
|
|
|
(190
|
)
|
|
645
|
|
|||||||
Prepaid pension
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
1,209
|
|
|
—
|
|
|
1,216
|
|
|||||||
Non-current intercompany receivables
|
|
—
|
|
|
868
|
|
|
—
|
|
|
261
|
|
|
7,046
|
|
|
(8,175
|
)
|
|
—
|
|
|||||||
Other non-current assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32
|
|
|
538
|
|
|
—
|
|
|
570
|
|
|||||||
Investment in subsidiary
|
|
3,375
|
|
|
8,899
|
|
|
12,211
|
|
|
19,470
|
|
|
—
|
|
|
(43,955
|
)
|
|
—
|
|
|||||||
Total assets
|
|
$
|
3,375
|
|
|
$
|
10,102
|
|
|
$
|
12,304
|
|
|
$
|
23,977
|
|
|
$
|
50,326
|
|
|
$
|
(70,679
|
)
|
|
$
|
29,405
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Liabilities and equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Accounts payable and accrued liabilities
|
|
$
|
—
|
|
|
$
|
2,157
|
|
|
$
|
1,994
|
|
|
$
|
56
|
|
|
$
|
1,832
|
|
|
$
|
(4,100
|
)
|
|
$
|
1,939
|
|
Short-term debt and current portion of long-term debt
|
|
—
|
|
|
112
|
|
|
—
|
|
|
600
|
|
|
—
|
|
|
—
|
|
|
712
|
|
|||||||
Fiduciary liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,834
|
|
|
—
|
|
|
11,834
|
|
|||||||
Current intercompany payables
|
|
—
|
|
|
234
|
|
|
61
|
|
|
12,978
|
|
|
986
|
|
|
(14,259
|
)
|
|
—
|
|
|||||||
Other current liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
80
|
|
|
1,006
|
|
|
—
|
|
|
1,086
|
|
|||||||
Total current liabilities
|
|
—
|
|
|
2,503
|
|
|
2,055
|
|
|
13,714
|
|
|
15,658
|
|
|
(18,359
|
)
|
|
15,571
|
|
|||||||
Long-term debt
|
|
—
|
|
|
4,223
|
|
|
—
|
|
|
2,404
|
|
|
—
|
|
|
—
|
|
|
6,627
|
|
|||||||
Non-current operating lease liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
143
|
|
|
801
|
|
|
—
|
|
|
944
|
|
|||||||
Deferred tax liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
389
|
|
|
(190
|
)
|
|
199
|
|
|||||||
Pension, other postretirement, and postemployment liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,348
|
|
|
390
|
|
|
—
|
|
|
1,738
|
|
|||||||
Non-current intercompany payables
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,212
|
|
|
963
|
|
|
(8,175
|
)
|
|
—
|
|
|||||||
Other non-current liabilities
|
|
—
|
|
|
1
|
|
|
—
|
|
|
113
|
|
|
763
|
|
|
—
|
|
|
877
|
|
|||||||
Total liabilities
|
|
—
|
|
|
6,727
|
|
|
2,055
|
|
|
24,934
|
|
|
18,964
|
|
|
(26,724
|
)
|
|
25,956
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total Aon shareholders’ equity
|
|
3,375
|
|
|
3,375
|
|
|
10,249
|
|
|
(957
|
)
|
|
31,288
|
|
|
(43,955
|
)
|
|
3,375
|
|
|||||||
Noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
74
|
|
|
—
|
|
|
74
|
|
|||||||
Total equity
|
|
3,375
|
|
|
3,375
|
|
|
10,249
|
|
|
(957
|
)
|
|
31,362
|
|
|
(43,955
|
)
|
|
3,449
|
|
|||||||
Total liabilities and equity
|
|
$
|
3,375
|
|
|
$
|
10,102
|
|
|
$
|
12,304
|
|
|
$
|
23,977
|
|
|
$
|
50,326
|
|
|
$
|
(70,679
|
)
|
|
$
|
29,405
|
|
|
|
Three Months Ended March 31, 2020
|
||||||||||||||||||||||||||
(millions)
|
|
Aon Ireland
|
|
Aon UK
|
|
Aon Global Holdings Limited
|
|
Aon Corporation
|
|
Other Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated
|
||||||||||||||
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash provided by (used for) operating activities
|
|
$
|
—
|
|
|
$
|
1,561
|
|
|
$
|
3,648
|
|
|
$
|
(512
|
)
|
|
$
|
852
|
|
|
$
|
(5,211
|
)
|
|
$
|
338
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Proceeds from investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
4
|
|
|
—
|
|
|
6
|
|
|||||||
Payments for investments
|
|
—
|
|
|
(450
|
)
|
|
(518
|
)
|
|
(30
|
)
|
|
(13
|
)
|
|
968
|
|
|
(43
|
)
|
|||||||
Net sales (purchases) of short-term investments - non-fiduciary
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(28
|
)
|
|
(10
|
)
|
|
—
|
|
|
(38
|
)
|
|||||||
Acquisition of businesses, net of cash acquired
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(334
|
)
|
|
—
|
|
|
(334
|
)
|
|||||||
Sale of businesses, net of cash sold
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30
|
|
|
—
|
|
|
30
|
|
|||||||
Capital expenditures
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(59
|
)
|
|
—
|
|
|
(59
|
)
|
|||||||
Cash provided by (used for) investing activities
|
|
—
|
|
|
(450
|
)
|
|
(518
|
)
|
|
(56
|
)
|
|
(382
|
)
|
|
968
|
|
|
(438
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Share repurchase
|
|
—
|
|
|
(463
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(463
|
)
|
|||||||
Advances from (to) affiliates
|
|
—
|
|
|
(618
|
)
|
|
(3,094
|
)
|
|
(2,044
|
)
|
|
(1,349
|
)
|
|
7,105
|
|
|
—
|
|
|||||||
Issuance of shares for employee benefit plans
|
|
—
|
|
|
(112
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(112
|
)
|
|||||||
Issuance of debt
|
|
—
|
|
|
457
|
|
|
—
|
|
|
1,603
|
|
|
—
|
|
|
|
|
2,060
|
|
||||||||
Repayment of debt
|
|
—
|
|
|
(273
|
)
|
|
—
|
|
|
(1,068
|
)
|
|
—
|
|
|
—
|
|
|
(1,341
|
)
|
|||||||
Cash dividends to shareholders
|
|
—
|
|
|
(102
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(102
|
)
|
|||||||
Noncontrolling interests and other financing activities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40
|
|
|
—
|
|
|
40
|
|
|||||||
Cash provided by (used for) financing activities
|
|
—
|
|
|
(1,111
|
)
|
|
(3,094
|
)
|
|
(1,509
|
)
|
|
(1,309
|
)
|
|
7,105
|
|
|
82
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Effect of exchange rate changes on cash and cash equivalents
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(82
|
)
|
|
—
|
|
|
(82
|
)
|
|||||||
Net increase (decrease) in cash and cash equivalents
|
|
—
|
|
|
—
|
|
|
36
|
|
|
(2,077
|
)
|
|
(921
|
)
|
|
2,862
|
|
|
(100
|
)
|
|||||||
Cash and cash equivalents at beginning of period
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,271
|
|
|
2,619
|
|
|
(4,100
|
)
|
|
790
|
|
|||||||
Cash and cash equivalents at end of period
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
36
|
|
|
$
|
194
|
|
|
$
|
1,698
|
|
|
$
|
(1,238
|
)
|
|
$
|
690
|
|
|
|
Three Months Ended March 31, 2019
|
||||||||||||||||||||||||||
(millions)
|
|
Aon Ireland
|
|
Aon UK
|
|
Aon Global Holdings Limited
|
|
Aon Corporation
|
|
Other Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated
|
||||||||||||||
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash provided by (used for) operating activities
|
|
$
|
—
|
|
|
$
|
(11
|
)
|
|
$
|
529
|
|
|
$
|
(34
|
)
|
|
$
|
143
|
|
|
$
|
(553
|
)
|
|
$
|
74
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Proceeds from investments
|
|
—
|
|
|
—
|
|
|
72
|
|
|
8
|
|
|
4
|
|
|
(72
|
)
|
|
12
|
|
|||||||
Payments for investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
|
(77
|
)
|
|
72
|
|
|
(14
|
)
|
|||||||
Net sales (purchases) of short-term investments - non-fiduciary
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
32
|
|
|
—
|
|
|
41
|
|
|||||||
Acquisition of businesses, net of cash acquired
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15
|
)
|
|
—
|
|
|
(15
|
)
|
|||||||
Sale of businesses, net of cash sold
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
|||||||
Capital expenditures
|
|
|
|
|
|
|
|
—
|
|
|
(57
|
)
|
|
—
|
|
|
(57
|
)
|
||||||||||
Cash provided by (used for) investing activities
|
|
—
|
|
|
—
|
|
|
72
|
|
|
8
|
|
|
(107
|
)
|
|
—
|
|
|
(27
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Share repurchase
|
|
—
|
|
|
(100
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(100
|
)
|
|||||||
Advances from (to) affiliates
|
|
—
|
|
|
305
|
|
|
(601
|
)
|
|
(265
|
)
|
|
(550
|
)
|
|
1,111
|
|
|
—
|
|
|||||||
Issuance of shares for employee benefit plans
|
|
—
|
|
|
(98
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(98
|
)
|
|||||||
Issuance of debt
|
|
—
|
|
|
384
|
|
|
—
|
|
|
485
|
|
|
2
|
|
|
—
|
|
|
871
|
|
|||||||
Repayment of debt
|
|
—
|
|
|
(384
|
)
|
|
—
|
|
|
(310
|
)
|
|
—
|
|
|
—
|
|
|
(694
|
)
|
|||||||
Cash dividends to shareholders
|
|
—
|
|
|
(96
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(96
|
)
|
|||||||
Noncontrolling interests and other financing activities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23
|
)
|
|
—
|
|
|
(23
|
)
|
|||||||
Cash provided by (used for) financing activities
|
|
—
|
|
|
11
|
|
|
(601
|
)
|
|
(90
|
)
|
|
(571
|
)
|
|
1,111
|
|
|
(140
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Effect of exchange rate changes on cash and cash equivalents
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
37
|
|
|
—
|
|
|
37
|
|
|||||||
Net increase (decrease) in cash and cash equivalents
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(116
|
)
|
|
(498
|
)
|
|
558
|
|
|
(56
|
)
|
|||||||
Cash and cash equivalents at beginning of period
|
|
—
|
|
|
—
|
|
|
—
|
|
|
862
|
|
|
3,473
|
|
|
(3,679
|
)
|
|
656
|
|
|||||||
Cash and cash equivalents at end of period
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
746
|
|
|
$
|
2,975
|
|
|
$
|
(3,121
|
)
|
|
$
|
600
|
|
•
|
For the first quarter of 2020, revenue increased $76 million, or 2%, to $3.2 billion compared to the prior year period due primarily to organic revenue growth of 5%, partially offset by a 2% unfavorable impact from translating prior year period results at current period foreign exchange rates (“foreign currency translation”) and a 1% unfavorable impact related to divestitures, net of acquisitions.
|
•
|
Operating expenses for the first quarter of 2020 were $2.2 billion, a decrease of $85 million from the prior year period. The decrease was due primarily to a $91 million decrease in restructuring charges, a $40 million favorable impact from foreign currency translation, and the preemptive reduction and deferral of certain discretionary expenses in an effort to proactively manage liquidity due to uncertainties surrounding COVID-19 and its impact to the Company, partially offset by $18 million of transaction costs related to the pending combination with WTW, an increase in investments supporting growth initiatives and Aon Business Services, and an increase in expense associated with 5% organic revenue growth.
|
•
|
Operating margin increased to 32.1% in the first quarter of 2020 from 27.7% in the prior year period. The increase was driven by organic revenue growth of 5%, strong operational improvement, and a decrease in expense due to the factors listed above.
|
•
|
Due to the factors set forth above, net income from continuing operations increased $116 million, or 17%, to $792 million for the first quarter of 2020 compared to the prior year period.
|
•
|
Diluted earnings per share from continuing operations was $3.29 per share for the first quarter of 2020 compared to $2.70 per share for the prior year period.
|
•
|
Cash flow provided by operating activities was $338 million for the first three months of 2020, an increase of $264 million from the prior year period, primarily reflecting strong operational improvement and near-term actions taken to improve working capital in an effort to proactively manage liquidity due to uncertainties surrounding COVID-19 and its impact on the Company. The prior year period included approximately $85 million of net cash payments related to legacy litigation.
|
•
|
Organic revenue growth, a non-GAAP measure defined under the caption “Review of Consolidated Results — Organic Revenue Growth,” was 5% for the first quarter of 2020. Organic revenue growth was driven by strong new business generation in Reinsurance Solutions and strong management of the renewal book globally in Health Solutions and Commercial Risk Solutions.
|
•
|
Adjusted operating margin, a non-GAAP measure defined under the caption “Review of Consolidated Results — Adjusted Operating Margin,” was 35.7% for the first quarter of 2020 compared to 33.7% in the prior year period. The increase in adjusted operating margin primarily reflects strong organic revenue growth of 5%, increased operating leverage across the portfolio, and the preemptive reduction and deferral of certain discretionary expenses.
|
•
|
Adjusted diluted earnings per share from continuing operations, a non-GAAP measure defined under the caption “Review of Consolidated Results — Adjusted Diluted Earnings per Share,” was $3.68 per share for the first quarter of 2020 compared to $3.31 per share for the prior year period.
|
•
|
Free cash flow, a non-GAAP measure defined under the caption “Review of Consolidated Results — Free Cash Flow,” increased in the first three months of 2020 by $262 million, or 1,541%, from the prior year period, to $279 million, reflecting an increase in cash flow from operations, partially offset by a $2 million increase in capital expenditures.
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Revenue
|
|
|
|
|
|
|
||
Total revenue
|
|
$
|
3,219
|
|
|
$
|
3,143
|
|
Expenses
|
|
|
|
|
|
|
||
Compensation and benefits
|
|
1,522
|
|
|
1,584
|
|
||
Information technology
|
|
111
|
|
|
117
|
|
||
Premises
|
|
73
|
|
|
87
|
|
||
Depreciation of fixed assets
|
|
41
|
|
|
40
|
|
||
Amortization of intangible assets
|
|
97
|
|
|
97
|
|
||
Other general expense
|
|
342
|
|
|
346
|
|
||
Total operating expenses
|
|
2,186
|
|
|
2,271
|
|
||
Operating income
|
|
1,033
|
|
|
872
|
|
||
Interest income
|
|
2
|
|
|
2
|
|
||
Interest expense
|
|
(83
|
)
|
|
(72
|
)
|
||
Other income (expense)
|
|
29
|
|
|
—
|
|
||
Income from continuing operations before income taxes
|
|
981
|
|
|
802
|
|
||
Income tax expense
|
|
189
|
|
|
126
|
|
||
Net income from continuing operations
|
|
792
|
|
|
676
|
|
||
Net income (loss) from discontinued operations
|
|
(1
|
)
|
|
—
|
|
||
Net income
|
|
791
|
|
|
676
|
|
||
Less: Net income attributable to noncontrolling interests
|
|
19
|
|
|
17
|
|
||
Net income attributable to Aon shareholders
|
|
$
|
772
|
|
|
$
|
659
|
|
Diluted net income per share attributable to Aon shareholders
|
|
|
|
|
||||
Continuing operations
|
|
$
|
3.29
|
|
|
$
|
2.70
|
|
Discontinued operations
|
|
—
|
|
|
—
|
|
||
Net income
|
|
$
|
3.29
|
|
|
$
|
2.70
|
|
Weighted average ordinary shares outstanding - diluted
|
|
234.5
|
|
|
243.7
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
|
2020
|
|
2019
|
|
% Change
|
|
Less: Currency Impact (1)
|
|
Less: Fiduciary Investment Income (2)
|
|
Less: Acquisitions, Divestitures & Other
|
|
Organic Revenue Growth (3)
|
|||||||||
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Commercial Risk Solutions
|
|
$
|
1,146
|
|
|
$
|
1,118
|
|
|
3
|
%
|
|
(2
|
)%
|
|
—
|
%
|
|
1
|
%
|
|
4
|
%
|
Reinsurance Solutions
|
|
848
|
|
|
788
|
|
|
8
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
9
|
|
||
Retirement Solutions
|
|
397
|
|
|
420
|
|
|
(5
|
)
|
|
(1
|
)
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
||
Health Solutions
|
|
502
|
|
|
486
|
|
|
3
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
5
|
|
||
Data & Analytic Services
|
|
331
|
|
|
336
|
|
|
(1
|
)
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
1
|
|
||
Elimination
|
|
(5
|
)
|
|
(5
|
)
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
||
Total revenue
|
|
$
|
3,219
|
|
|
$
|
3,143
|
|
|
2
|
%
|
|
(2
|
)%
|
|
—
|
%
|
|
(1
|
)%
|
|
5
|
%
|
(1)
|
Currency impact is determined by translating prior period's revenue at this period's foreign exchange rates.
|
(2)
|
Fiduciary investment income for the three months ended March 31, 2020 and 2019, respectively, was $15 million and $19 million.
|
(3)
|
Organic revenue growth includes the impact of intercompany activity and excludes the impact of changes in foreign exchange rates, fiduciary investment income, acquisitions, divestitures, transfers between revenue lines, and gains or losses on derivatives accounted for as hedges.
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Revenue from continuing operations
|
|
$
|
3,219
|
|
|
$
|
3,143
|
|
|
|
|
|
|
||||
Operating income from continuing operations - as reported
|
|
$
|
1,033
|
|
|
$
|
872
|
|
Amortization and impairment of intangible assets
|
|
97
|
|
|
97
|
|
||
Restructuring
|
|
—
|
|
|
91
|
|
||
Transaction costs (1)
|
|
18
|
|
|
—
|
|
||
Operating income from continuing operations - as adjusted
|
|
$
|
1,148
|
|
|
$
|
1,060
|
|
|
|
|
|
|
||||
Operating margin from continuing operations - as reported
|
|
32.1
|
%
|
|
27.7
|
%
|
||
Operating margin from continuing operations - as adjusted
|
|
35.7
|
%
|
|
33.7
|
%
|
(1)
|
Certain transaction costs associated with the Combination will be incurred prior to the expected completion of the Combination in the first half of 2021. These costs may include advisory, legal, accounting, valuation, and other professional or consulting fees required to complete the Combination.
|
|
|
Three Months Ended March 31, 2020
|
||||||||||
|
|
|
|
|
|
Non-GAAP
|
||||||
|
|
U.S. GAAP
|
|
Adjustments
|
|
Adjusted
|
||||||
Operating income from continuing operations
|
|
$
|
1,033
|
|
|
$
|
115
|
|
|
$
|
1,148
|
|
Interest income
|
|
2
|
|
|
—
|
|
|
2
|
|
|||
Interest expense
|
|
(83
|
)
|
|
—
|
|
|
(83
|
)
|
|||
Other income (expense)
|
|
29
|
|
|
—
|
|
|
29
|
|
|||
Income from continuing operations before income taxes
|
|
981
|
|
|
115
|
|
|
1,096
|
|
|||
Income tax expense (1)
|
|
189
|
|
|
23
|
|
|
212
|
|
|||
Net income from continuing operations
|
|
792
|
|
|
92
|
|
|
884
|
|
|||
Net income (loss) from discontinued operations
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||
Net income
|
|
791
|
|
|
92
|
|
|
883
|
|
|||
Less: Net income attributable to noncontrolling interests
|
|
19
|
|
|
—
|
|
|
19
|
|
|||
Net income attributable to Aon shareholders
|
|
$
|
772
|
|
|
$
|
92
|
|
|
$
|
864
|
|
|
|
|
|
|
|
|
||||||
Diluted net income per share attributable to Aon shareholders
|
|
|
|
|
|
|
||||||
Continuing operations
|
|
$
|
3.29
|
|
|
$
|
0.39
|
|
|
$
|
3.68
|
|
Discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Net income
|
|
$
|
3.29
|
|
|
$
|
0.39
|
|
|
$
|
3.68
|
|
|
|
|
|
|
|
|
||||||
Weighted average ordinary shares outstanding - diluted
|
|
234.5
|
|
|
—
|
|
|
234.5
|
|
|||
Effective tax rates (1)
|
|
|
|
|
|
|
||||||
Continuing operations
|
|
19.3
|
%
|
|
|
|
19.3
|
%
|
||||
Discontinued operations
|
|
30.7
|
%
|
|
|
|
30.7
|
%
|
|
|
Three Months Ended March 31, 2019
|
||||||||||
|
|
|
|
|
|
Non-GAAP
|
||||||
|
|
U.S. GAAP
|
|
Adjustments
|
|
Adjusted
|
||||||
Operating income from continuing operations
|
|
$
|
872
|
|
|
$
|
188
|
|
|
$
|
1,060
|
|
Interest income
|
|
2
|
|
|
—
|
|
|
2
|
|
|||
Interest expense
|
|
(72
|
)
|
|
—
|
|
|
(72
|
)
|
|||
Other income (expense)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Income from continuing operations before income taxes
|
|
802
|
|
|
188
|
|
|
990
|
|
|||
Income tax expense (1)
|
|
126
|
|
|
41
|
|
|
167
|
|
|||
Net income from continuing operations
|
|
676
|
|
|
147
|
|
|
823
|
|
|||
Net income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Net income
|
|
676
|
|
|
147
|
|
|
823
|
|
|||
Less: Net income attributable to noncontrolling interests
|
|
17
|
|
|
—
|
|
|
17
|
|
|||
Net income attributable to Aon shareholders
|
|
$
|
659
|
|
|
$
|
147
|
|
|
$
|
806
|
|
|
|
|
|
|
|
|
||||||
Diluted net income per share attributable to Aon shareholders
|
|
|
|
|
|
|
||||||
Continuing operations
|
|
$
|
2.70
|
|
|
$
|
0.61
|
|
|
$
|
3.31
|
|
Discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Net income
|
|
$
|
2.70
|
|
|
$
|
0.61
|
|
|
$
|
3.31
|
|
|
|
|
|
|
|
|
||||||
Weighted average ordinary shares outstanding - diluted
|
|
243.7
|
|
|
—
|
|
|
243.7
|
|
|||
Effective tax rates (1)
|
|
|
|
|
|
|
||||||
Continuing operations
|
|
15.7
|
%
|
|
|
|
16.9
|
%
|
||||
Discontinued operations
|
|
—
|
%
|
|
|
|
—
|
%
|
(1)
|
Adjusted items are generally taxed at the estimated annual effective tax rate, except for the applicable tax impact associated with estimated restructuring plan expenses, accelerated tradename amortization, impairment charges and certain transaction costs, which are adjusted at the related jurisdictional rate. In addition, tax expense excludes the tax impacts of payment of certain legacy litigation and enactment date impacts of the Tax Cuts and Jobs Act of 2017.
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Cash provided by operating activities
|
|
$
|
338
|
|
|
$
|
74
|
|
Capital expenditures used for operations
|
|
(59
|
)
|
|
(57
|
)
|
||
Free cash flow provided by operations
|
|
$
|
279
|
|
|
$
|
17
|
|
|
Statement of Financial Position Classification
|
|
|
||||||||||||
Asset Type
|
Cash and Cash
Equivalents
|
|
Short-term
Investments
|
|
Fiduciary
Assets
|
|
Total
|
||||||||
Certificates of deposit, bank deposits or time deposits
|
$
|
690
|
|
|
$
|
—
|
|
|
$
|
3,113
|
|
|
$
|
3,803
|
|
Money market funds
|
—
|
|
|
170
|
|
|
2,081
|
|
|
2,251
|
|
||||
Cash and short-term investments
|
690
|
|
|
170
|
|
|
5,194
|
|
|
6,054
|
|
||||
Fiduciary receivables
|
—
|
|
|
—
|
|
|
7,207
|
|
|
7,207
|
|
||||
Total
|
$
|
690
|
|
|
$
|
170
|
|
|
$
|
12,401
|
|
|
$
|
13,261
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Cash provided by operating activities
|
|
$
|
338
|
|
|
$
|
74
|
|
Cash provided by (used for) investing activities
|
|
$
|
(438
|
)
|
|
$
|
(27
|
)
|
Cash used for financing activities
|
|
$
|
82
|
|
|
$
|
(140
|
)
|
Effect of exchange rates changes on cash and cash equivalents
|
|
$
|
(82
|
)
|
|
$
|
37
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Shares repurchased
|
2.2
|
|
|
0.6
|
|
||
Average price per share
|
$
|
212.78
|
|
|
$
|
161.16
|
|
Costs recorded to retained earnings
|
|
|
|
||||
Total repurchase cost
|
$
|
461
|
|
|
$
|
100
|
|
Additional associated costs
|
2
|
|
|
1
|
|
||
Total costs recorded to retained earnings
|
$
|
463
|
|
|
$
|
101
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Total issuances (1)
|
|
$
|
2,060
|
|
|
$
|
871
|
|
Total repayments
|
|
$
|
(1,341
|
)
|
|
$
|
(694
|
)
|
Net issuances
|
|
$
|
719
|
|
|
$
|
177
|
|
(1)
|
The proceeds of the commercial paper issuances were used primarily for short-term working capital needs.
|
|
Ratings
|
|
|
||
|
Senior Long-term Debt
|
|
Commercial Paper
|
|
Outlook
|
Standard & Poor’s
|
A-
|
|
A-2
|
|
Stable
|
Moody’s Investor Services
|
Baa2
|
|
P-2
|
|
Stable
|
Fitch, Inc.
|
BBB+
|
|
F-2
|
|
Negative
|
•
|
general economic and political conditions in the countries in which we do business around the world, including the withdrawal of the U.K. from the European Union;
|
•
|
changes in the competitive environment or damage to our reputation;
|
•
|
fluctuations in exchange and interest rates that could influence revenues and expenses;
|
•
|
changes in global equity and fixed income markets that could affect the return on invested assets;
|
•
|
changes in the funding status of our various defined benefit pension plans and the impact of any increased pension funding resulting from those changes;
|
•
|
the level of our debt limiting financial flexibility or increasing borrowing costs;
|
•
|
rating agency actions that could affect our ability to borrow funds;
|
•
|
volatility in our tax rate due to a variety of different factors including U.S. federal income tax reform;
|
•
|
changes in estimates or assumptions on our financial statements;
|
•
|
limits on our subsidiaries to make dividend and other payments to us;
|
•
|
the impact of lawsuits and other contingent liabilities and loss contingencies arising from errors and omissions and other claims against us;
|
•
|
the impact of, and potential challenges in complying with, legislation and regulation in the jurisdictions in which we operate, particularly given the global scope of our businesses and the possibility of conflicting regulatory requirements across jurisdictions in which we do business;
|
•
|
the impact of any investigations brought by regulatory authorities in Ireland, the U.S., U.K., and other countries;
|
•
|
the impact of any inquiries relating to compliance with the U.S. Foreign Corrupt Practices Act and non-U.S. anti-corruption laws and with U.S. and non-U.S. trade sanctions regimes;
|
•
|
failure to protect intellectual property rights or allegations that we infringe on the intellectual property rights of others;
|
•
|
the effects of Irish law on our operating flexibility and the enforcement of judgments against us;
|
•
|
the failure to retain and attract qualified personnel;
|
•
|
international risks associated with our global operations;
|
•
|
the effects of natural or man-made disasters, including the effects of COVID-19 and other health pandemics;
|
•
|
the potential of a system or network breach or disruption resulting in operational interruption or improper disclosure of personal data;
|
•
|
our ability to develop and implement new technology;
|
•
|
damage to our reputation among clients, markets or third parties;
|
•
|
the actions taken by third parties that perform aspects of our business operations and client services;
|
•
|
the extent to which we manage certain risks created in connection with the various services, including fiduciary and investment consulting and other advisory services, among others, that we currently provide, or will provide in the future, to clients;
|
•
|
our ability to continue, and the costs and risks associated with, growing, developing and integrating companies that we acquire or new lines of business;
|
•
|
changes in commercial property and casualty markets, commercial premium rates or methods of compensation;
|
•
|
changes in the health care system or our relationships with insurance carriers;
|
•
|
our ability to implement initiatives intended to yield cost savings and the ability to achieve those cost savings;
|
•
|
risks and uncertainties associated with the sale of the Divested Business;
|
•
|
our ability to realize the expected benefits from our restructuring plan; and
|
•
|
risks and uncertainties associated with the Combination, including our ability to obtain the requisite approvals of, to satisfy the other conditions to, or to otherwise complete, the Combination on the expected time frame, or at all, the occurrence of unanticipated difficulties or costs in connection with the Combination, our ability to successfully integrate the combined companies following the Combination and our ability to realize the expected benefits from the Combination.
|
•
|
we will be required to pay certain costs and expenses relating to the Combination;
|
•
|
if the Business Combination Agreement is terminated under specified circumstances, we may be obligated to reimburse certain transaction-related expenses of WTW or, if terminated under other circumstances related to a failure to obtain the required antitrust clearances, pay to WTW a termination fee equal to $1 billion;
|
•
|
we may experience negative reactions from the financial markets, including negative impacts on the market price of our securities;
|
•
|
the manner in which clients, vendors, business partners and other third parties perceive we may be negatively impacted, which in turn could affect our ability to compete for new business or to obtain renewals in the marketplace more broadly;
|
•
|
matters relating to the Combination (including integration planning) may require substantial commitments of time and resources by management, which could otherwise have been devoted to other opportunities that may have been beneficial to Aon;
|
•
|
the Business Combination Agreement restricts us, without WTW’s consent and subject to certain exceptions, from making certain acquisitions and taking other specified actions until the Combination occurs or the Business Combination Agreement terminates. These restrictions may prevent us from pursuing otherwise attractive business opportunities and making other changes to our business that may arise prior to the closing of the Combination or the termination of the Business Combination Agreement; and
|
•
|
We could be subject to litigation related to any failure to close the Combination or related to any enforcement proceeding commenced against us to perform our obligations under the Business Combination Agreement.
|
Period
|
|
Total Number of Shares Purchased
|
|
Average Price Paid per Share (1)
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2)
|
|
Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (1)(2)
|
||||||
1/1/20 - 1/31/20
|
|
248,289
|
|
|
$
|
211.45
|
|
|
248,289
|
|
|
$
|
1,971,130,556
|
|
2/1/20 - 2/29/20
|
|
1,132,641
|
|
|
$
|
228.23
|
|
|
1,132,641
|
|
|
$
|
1,712,624,157
|
|
3/1/20 - 3/31/20
|
|
785,647
|
|
|
$
|
190.93
|
|
|
785,647
|
|
|
$
|
1,562,623,364
|
|
|
|
2,166,577
|
|
|
$
|
212.78
|
|
|
2,166,577
|
|
|
$
|
1,562,623,364
|
|
(1)
|
Does not include commissions or other costs paid to repurchase shares.
|
(2)
|
The Repurchase Program was established in April 2012 with $5.0 billion in authorized repurchases, and was increased by $5.0 billion in authorized repurchases in each of November 2014 and June 2017 for a total of $15.0 billion in repurchase authorizations.
|
|
Aon plc
|
|
|
(Registrant)
|
|
|
|
|
May 1, 2020
|
By:
|
/s/ Michael Neller
|
|
Michael Neller
|
|
|
SENIOR VICE PRESIDENT AND
|
|
|
GLOBAL CONTROLLER
|
|
|
(Principal Accounting Officer and duly authorized officer of Registrant)
|
Exhibit Number
|
|
Description of Exhibit
|
2.1
|
|
|
2.2
|
|
|
2.3
|
|
|
2.4
|
|
|
3.1
|
|
|
4.1
|
|
|
4.2
|
|
|
4.3
|
|
|
4.4
|
|
|
4.5
|
|
|
4.6
|
|
|
4.7
|
|
|
10.1
|
|
|
10.2
|
|
|
10.3
|
|
|
10.4
|
|
|
10.5
|
|
|
10.6*#
|
|
|
10.7*#
|
|
|
10.8*#
|
|
|
10.9*#
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Aon plc;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
May 1, 2020
|
/s/ GREGORY C. CASE
|
|
|
Gregory C. Case
Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Aon plc;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
May 1, 2020
|
/s/ CHRISTA DAVIES
|
|
|
Christa Davies
Chief Financial Officer
|
|
/s/ GREGORY C. CASE
|
|
Gregory C. Case
Chief Executive Officer
|
|
May 1, 2020
|
|
/s/ CHRISTA DAVIES
|
|
Christa Davies
Chief Financial Officer
|
|
May 1, 2020
|
ARTICLE I DEFINITIONS
|
1
|
ARTICLE II THE CREDITS
|
227
|
2.1.
|
Commitment 227
|
2.2.
|
Required Payments 227
|
2.3.
|
Ratable Loans 227
|
2.4.
|
Types of Advances 227
|
2.5.
|
Facility Fee; Reductions in Aggregate Commitment 237
|
2.6.
|
Minimum Amount of Each Advance 238
|
2.7.
|
Principal Payments 238
|
2.8.
|
Method of Selecting Types and Interest Periods for New Advances 248
|
2.9.
|
Conversion and Continuation of Outstanding Advances 249
|
2.10.
|
Changes in Interest Rate, etc. 2530
|
2.11.
|
Rates Applicable After Default 2530
|
2.12.
|
Method of Payment 2630
|
2.13.
|
Noteless Agreement; Evidence of Indebtedness 2631
|
2.14.
|
Telephonic Notices 327
|
2.15.
|
Interest Payment Dates; Interest and Fee Basis 327
|
2.16.
|
Notification of Advances, Interest Rates, Prepayments and Commitment Reductions 327
|
2.17.
|
Lending Installations 328
|
2.18.
|
Non‑Receipt of Funds by the Administrative Agent 2833
|
2.19.
|
Increase in the Aggregate Commitments 2833
|
2.20.
|
Replacement of Lender 305
|
2.21.
|
Defaulting Lenders 305
|
2.22.
|
Extension of Facility Termination Date 316
|
2.23.
|
Borrower Representative 37
|
ARTICLE III YIELD PROTECTION; TAXES
|
328
|
3.1.
|
Yield Protection 328
|
3.2.
|
Changes in Capital or Liquidity Requirements 338
|
3.3.
|
Availability of Types of Advances 339
|
3.4.
|
Funding Indemnification 349
|
3.5.
|
Taxes 349
|
3.6.
|
Lender Statements; Survival of Indemnity 3945
|
ARTICLE IV CONDITIONS PRECEDENT
|
406
|
4.1.
|
Effectiveness 406
|
4.2.
|
Initial Advance to Each Designated Subsidiary 417
|
4.3.
|
Each Credit Extension 428
|
4.4.
|
Each Commitment Increase 439
|
4.5.
|
Each Commitment Extension 439
|
4.6.
|
Initial Advance to Aon Ireland 50
|
ARTICLE V REPRESENTATIONS AND WARRANTIES
|
4450
|
5.1.
|
Corporate Existence and Standing 4450
|
5.2.
|
Authorization and Validity 4450
|
5.3.
|
Compliance with Laws 4450
|
5.4.
|
Governmental Consents 451
|
5.5.
|
Financial Statements 451
|
5.6.
|
Material Adverse Change 451
|
5.7.
|
Taxes 451
|
5.8.
|
Litigation and Contingent Obligations 451
|
5.9.
|
ERISA 4652
|
5.10.
|
Regulation U 4653
|
5.11.
|
Investment Company 4753
|
5.12.
|
Ownership of Properties 4753
|
5.13.
|
Environmental Laws 4753
|
5.14.
|
Insurance 547
|
5.15.
|
Insurance Licenses 547
|
5.16.
|
Disclosure 548
|
5.17.
|
Anti-Corruption Laws and Sanctions 548
|
ARTICLE VI COVENANTS
|
548
|
6.1.
|
Financial Reporting 4855
|
6.2.
|
Use of Proceeds 506
|
6.3.
|
Notice of Default 507
|
6.4.
|
Conduct of Business 507
|
6.5.
|
Taxes 517
|
6.6.
|
Insurance 517
|
6.7.
|
Compliance with Laws 517
|
6.8.
|
Maintenance of Properties 517
|
6.9.
|
Inspection 518
|
6.10.
|
Merger 528
|
6.11.
|
Liens 539
|
6.12.
|
Affiliates 5461
|
6.13.
|
Change in Fiscal Year 5561
|
6.14.
|
Financial Covenants 5561
|
6.15.
|
ERISA 5562
|
6.16.
|
Indebtedness 562
|
6.17.
|
Additional Guarantors 5763
|
ARTICLE VII DEFAULTS
|
5763
|
7.1.
|
Representations and Warranties 5763
|
7.2.
|
Non-Payment 5764
|
7.3.
|
Specific Covenants 5764
|
7.4.
|
Other Defaults 5764
|
7.5.
|
Cross-Default 5764
|
7.6.
|
Insolvency 5864
|
7.7.
|
Involuntary Insolvency 5864
|
7.8.
|
Condemnation 658
|
7.9.
|
Judgments 658
|
7.10.
|
Change of Control 658
|
7.11.
|
ERISA 658
|
7.12.
|
Invalidity of Guaranty 659
|
ARTICLE VIII ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
|
659
|
8.1.
|
Acceleration 659
|
8.2.
|
Amendments 5966
|
8.3.
|
Preservation of Rights 607
|
ARTICLE IX GENERAL PROVISIONS
|
607
|
9.1.
|
Survival of Representations 607
|
9.2.
|
Governmental Regulation 607
|
9.3.
|
Headings 617
|
9.4.
|
Entire Agreement 617
|
9.5.
|
Several Obligations; Benefits of this Agreement 617
|
9.6.
|
Expenses; Indemnification 618
|
9.7.
|
Judgments 628
|
9.8.
|
Accounting 628
|
9.9.
|
Severability of Provisions 629
|
9.10.
|
Nonliability of Lenders 629
|
9.11.
|
Confidentiality 629
|
9.12.
|
Disclosure 6370
|
9.13.
|
USA PATRIOT ACT NOTIFICATION 6370
|
9.14.
|
Acknowledgement and Consent to Bail-In of Affected Financial Institutions 70
|
ARTICLE X THE ADMINISTRATIVE AGENT
|
6471
|
10.1.
|
Appointment and Authority 6471
|
10.2.
|
Rights as a Lender 6471
|
10.3.
|
Exculpatory Provisions 6471
|
10.4.
|
Reliance by Administrative Agent 6572
|
10.5.
|
Delegation of Duties 6573
|
10.6.
|
Resignation of Administrative Agent 6673
|
10.7.
|
Non-Reliance on Administrative Agent and Other Lenders 674
|
10.8.
|
Administrative Agent’s Reimbursement and Indemnification 674
|
10.9.
|
No Other Duties, etc 675
|
10.10.
|
Fees 6875
|
10.11.
|
Lender ERISA Matters 75
|
ARTICLE XI SETOFF; RATABLE PAYMENTS
|
768
|
11.1.
|
Setoff 768
|
11.2.
|
Ratable Payments 6877
|
ARTICLE XII BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
|
6977
|
12.1.
|
Successors and Assigns Generally 6977
|
12.2.
|
Assignments by Lenders 6978
|
12.3.
|
Register 7180
|
12.4.
|
Participations 7280
|
12.5.
|
Certain Pledges 7381
|
12.6.
|
Competitors 7381
|
ARTICLE XIII NOTICES
|
7483
|
13.1.
|
Giving Notice 7483
|
13.2.
|
Change of Address, etc 7584
|
13.3.
|
Platform. 7584
|
ARTICLE XIV COUNTERPARTS
|
7684
|
ARTICLE XV Guaranty
|
7685
|
15.1.
|
Guaranty; Limitation of Liability 7685
|
15.2.
|
Guaranty Absolute 7785
|
15.3.
|
Rights Of Lenders 786
|
15.4.
|
Certain Waivers and Acknowledgements 878
|
15.5.
|
Obligations Independent 879
|
15.6.
|
Subrogation 879
|
15.7.
|
Termination; Reinstatement 7988
|
15.8.
|
Stay Of Acceleration 7988
|
15.9.
|
Condition Of Borrowers 7988
|
15.10.
|
Guaranty Supplements 808
|
15.11.
|
Irish Limitation 89
|
ARTICLE XVI miscellaneous;
|
809
|
16.1.
|
Choice of Law 809
|
16.2.
|
Consent to Jurisdiction, etc 809
|
16.3.
|
Designated Subsidiaries 8190
|
16.4.
|
Substitution of Currency 8291
|
16.5.
|
WAIVER OF JURY TRIAL 8392
|
(a)
|
a bank which is authorized or licensed (pursuant to section 9 or section 9A of the Central Bank Act 1971 of Ireland) to carry on banking business in Ireland and which is carrying on a bona fide banking business in Ireland (for the purposes of section 246(3) TCA) and whose Lending Installation is located in Ireland;
|
(a)
|
a building society (within the meaning of section 256(1) TCA) which is carrying on a bona fide banking business in Ireland (for the purposes of section 246(3) TCA) and whose Lending Installation is located in Ireland;
|
(b)
|
an authorized credit institution (under the terms of Directive 2013/36/EU) which has duly established a branch in Ireland, having made all necessary notifications to its home state competent authorities (as required under Directive 2013/36/EU and, where applicable, under Council Regulation No 1024/2013) in relation to its intention to carry on banking business in Ireland, and such credit institution is carrying on a bona fide banking business in Ireland (for the purposes of section 246(3) TCA) and whose Lending Installation is located in Ireland;
|
(c)
|
a body corporate:
|
(i)
|
which, by virtue of the law of a Qualifying Jurisdiction, is resident in the Qualifying Jurisdiction for the purposes of tax and that jurisdiction imposes a tax that generally applies to interest receivable in that jurisdiction by companies from sources outside that jurisdiction; or
|
(i)
|
which is a US corporation which is incorporated in the United States and is taxed in the United States on its worldwide income;
|
(ii)
|
which is a US limited liability company where (I) the ultimate recipients of the interest would themselves be Irish Qualifying Lenders under sub-paragraphs (i), (ii) or (iv) of this paragraph (d), and (II) business is conducted through the US limited liability company for market reasons and not for tax avoidance purposes; or
|
(iii)
|
where the interest under a Loan Document:
|
(1)
|
is exempted from the charge to Irish income tax under an Irish Tax Treaty in force on the date the interest is paid; or
|
(1)
|
would be exempted from the charge to Irish income tax if an Irish Tax Treaty which has been signed but is not yet in force had the force of law on the date the interest is paid,
|
(d)
|
a body corporate which advances money in the ordinary course of a trade which includes the lending of money and whose Lending Installation is located in Ireland where the interest on the advance under a Loan Document is taken into account in computing the trading income of such body corporate and such body corporate has complied with the notification requirements under section 246(5) TCA;
|
(e)
|
a qualifying company (within the meaning of section 110 TCA) whose Lending Installation is located in Ireland;
|
(f)
|
an investment undertaking (within the meaning of section 739B TCA) whose Lending Installation is located in Ireland; or
|
(g)
|
an Irish Treaty Lender.
|
(a)
|
a member state of the European Communities other than Ireland;
|
(b)
|
a jurisdiction with which Ireland has entered into an Irish Tax Treaty that has the force of law; or
|
(c)
|
a jurisdiction with which Ireland has entered into an Irish Tax Treaty where that treaty will (on completion of necessary procedures) have the force of law.
|
(A)
|
each Lender and Administrative Agent that is a U.S. Person shall deliver to each U.S. Borrower and the Administrative Agent, on or prior to the date it becomes a party to this Agreement (and from time to time thereafter upon the reasonable request of any U.S. Borrower or the Administrative Agent), executed originals of IRS Form W-9 certifying that it is exempt from U.S. federal backup withholding tax;
|
(B)
|
each Non-U.S. Lender shall, to the extent it is legally entitled to do so, deliver to the U.S. Borrowers and the Administrative Agent (in such number of copies as shall be requested by the recipient), on or prior to the date on which it becomes a party to this Agreement (and from time to time thereafter upon the reasonable request of any U.S. Borrower or the Administrative Agent), whichever of the following is applicable:
|
(i)
|
in the case of a Non-U.S. Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed originals of IRS Form W-8BEN or W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;
|
(iii)
|
in the case of a Non-U.S. Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit F-1 to the effect that such Non-U.S. Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10-percent shareholder” of any U.S. Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed originals of IRS Form W-8BEN or W-8BEN-E; or
|
(iv)
|
to the extent a Non-U.S. Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of Exhibit F-2 or Exhibit F-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Non-U.S. Lender is a partnership and one or more direct or indirect partners of such Non-U.S. Lender are claiming the portfolio interest exemption, such Non-U.S. Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit F-4 on behalf of each such direct and indirect partner;
|
(D)
|
if a payment made to a Lender or the Administrative Agent under this Agreement or any other Loan Document would be subject to U.S. federal withholding tax imposed by FATCA if it were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender or Administrative Agent shall deliver to the U.S. Borrowers and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by any U.S. Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by any U.S. Borrower or the Administrative Agent as may be necessary for the U.S. Borrowers and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender or Administrative Agent has complied with such Lender’s or Administrative Agent’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.
|
*
|
In the event of a split rating, the applicable rating shall be deemed to be higher of the two ratings; provided, if the difference between the two ratings is greater than one sub-grade, the applicable rating shall be deemed to be one sub-grade below the higher of the two ratings, with Level I being the highest rating and Level V being the lowest rating.
|
By:
|
Name: Title: |
ARTICLEArticle I DEFINITIONS
|
1
|
ARTICLEArticle II THE CREDITS
|
237
|
2.1.
|
Commitment 237
|
2.2.
|
Required Payments 237
|
2.3.
|
Ratable Loans 237
|
2.4.
|
Types of Advances 247
|
2.5.
|
Facility Fee; Reductions in Aggregate Commitment 247
|
2.6.
|
Minimum Amount of Each Advance 247
|
2.7.
|
Principal Payments 248
|
2.8.
|
Method of Selecting Types and Interest Periods for New Advances 258
|
2.9.
|
Conversion and Continuation of Outstanding Advances 259
|
2.10.
|
Changes in Interest Rate, etc. 2630
|
2.11.
|
Rates Applicable After Default 2630
|
2.12.
|
Method of Payment 2730
|
2.13.
|
Noteless Agreement; Evidence of Indebtedness 2731
|
2.14.
|
Telephonic Notices 2831
|
2.15.
|
Interest Payment Dates; Interest and Fee Basis 328
|
2.16.
|
Notification of Advances, Interest Rates, Prepayments and Commitment Reductions 329
|
2.17.
|
Lending Installations 329
|
2.18.
|
Non‑Receipt of Funds by the Administrative Agent 329
|
2.19.
|
Increase in the Aggregate Commitments 2933
|
2.20.
|
Replacement of Lender 314
|
2.21.
|
Defaulting Lenders 315
|
2.22.
|
Extension of Facility Termination Date 336
|
2.23.
|
LIBOR Successor Rate 37
|
2.24.
|
Borrower Representative 41
|
ARTICLEArticle III YIELD PROTECTION; TAXES
|
342
|
3.1.
|
Yield Protection 342
|
3.2.
|
Changes in Capital or Liquidity Requirements 342
|
3.3.
|
Availability of Types of Advances 434
|
3.4.
|
Funding Indemnification 435
|
3.5.
|
Taxes 435
|
3.6.
|
Lender Statements; Survival of Indemnity 419
|
ARTICLEArticle IV CONDITIONS PRECEDENT
|
4150
|
4.1.
|
Effectiveness 4150
|
4.2.
|
Initial Advance to Each Designated Subsidiary 4251
|
4.3.
|
Each Credit Extension 4352
|
4.4.
|
Each Commitment Increase 4453
|
4.5.
|
Each Commitment Extension 4453
|
4.6.
|
Initial Advance to Aon Ireland 53
|
ARTICLEArticle V REPRESENTATIONS AND WARRANTIES
|
545
|
5.1.
|
Corporate Existence and Standing 545
|
5.2.
|
Authorization and Validity 545
|
5.3.
|
Compliance with Laws 545
|
5.4.
|
Governmental Consents 4655
|
5.5.
|
Financial Statements 4655
|
5.6.
|
Material Adverse Change 4655
|
5.7.
|
Taxes 4655
|
5.8.
|
Litigation and Contingent Obligations 4655
|
5.9.
|
ERISA 4755
|
5.10.
|
Regulation U 4856
|
5.11.
|
Investment Company 4857
|
5.12.
|
Ownership of Properties 4857
|
5.13.
|
Environmental Laws 4857
|
5.14.
|
Insurance 4957
|
5.15.
|
Insurance Licenses 4957
|
5.16.
|
Disclosure 4958
|
5.17.
|
Anti-Corruption Laws and Sanctions 4958
|
ARTICLEArticle VI COVENANTS
|
4958
|
6.1.
|
Financial Reporting 508
|
6.2.
|
Use of Proceeds 5160
|
6.3.
|
Notice of Default 5260
|
6.4.
|
Conduct of Business 5260
|
6.5.
|
Taxes 5261
|
6.6.
|
Insurance 5261
|
6.7.
|
Compliance with Laws 5261
|
6.8.
|
Maintenance of Properties 5261
|
6.9.
|
Inspection 5361
|
6.10.
|
Merger 5362
|
6.11.
|
Liens 5462
|
6.12.
|
Affiliates 564
|
6.13.
|
Change in Fiscal Year 656
|
6.14.
|
Financial Covenants 656
|
6.15.
|
ERISA 657
|
6.16.
|
Indebtedness 5766
|
6.17.
|
Additional Guarantors 5867
|
ARTICLEArticle VII DEFAULTS
|
5867
|
7.1.
|
Representations and Warranties 5867
|
7.2.
|
Non-Payment 5967
|
7.3.
|
Specific Covenants 5967
|
7.4.
|
Other Defaults 5967
|
7.5.
|
Cross-Default 5967
|
7.6.
|
Insolvency 5968
|
7.7.
|
Involuntary Insolvency 5968
|
7.8.
|
Condemnation 608
|
7.9.
|
Judgments 608
|
7.10.
|
Change of Control 608
|
7.11.
|
ERISA 608
|
7.12.
|
Invalidity of Guaranty 609
|
ARTICLEArticle VIII ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
|
609
|
8.1.
|
Acceleration 609
|
8.2.
|
Amendments 619
|
8.3.
|
Preservation of Rights 6270
|
ARTICLEArticle IX GENERAL PROVISIONS
|
6270
|
9.1.
|
Survival of Representations 6270
|
9.2.
|
Governmental Regulation 6270
|
9.3.
|
Headings 6371
|
9.4.
|
Entire Agreement 6371
|
9.5.
|
Several Obligations; Benefits of this Agreement 6371
|
9.6.
|
Expenses; Indemnification 6371
|
9.7.
|
Judgments 6472
|
9.8.
|
Accounting 6472
|
9.9.
|
Severability of Provisions 6472
|
9.10.
|
Nonliability of Lenders 6573
|
9.11.
|
Confidentiality 6573
|
9.12.
|
Disclosure 6674
|
9.13.
|
USA PATRIOT ACT NOTIFICATION 6674
|
9.14.
|
Acknowledgement and Consent to Bail-In of EEAAffected Financial Institutions 6674
|
ARTICLEArticle X THE ADMINISTRATIVE AGENT
|
675
|
10.1.
|
Appointment and Authority 675
|
10.2.
|
Rights as a Lender 675
|
10.3.
|
Exculpatory Provisions 675
|
10.4.
|
Reliance by Administrative Agent 768
|
10.5.
|
Delegation of Duties 6877
|
10.6.
|
Resignation of Administrative Agent 6977
|
10.7.
|
Non-Reliance on Administrative Agent and Other Lenders 708
|
10.8.
|
Administrative Agent’s Reimbursement and Indemnification 708
|
10.9.
|
No Other Duties, etc 709
|
10.10.
|
Fees 719
|
10.11.
|
Lender ERISA Matters 719
|
ARTICLEArticle XI SETOFF; RATABLE PAYMENTS
|
7180
|
11.1.
|
Setoff 7180
|
11.2.
|
Ratable Payments 781
|
ARTICLEArticle XII BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
|
7281
|
12.1.
|
Successors and Assigns Generally 7281
|
12.2.
|
Assignments by Lenders 782
|
12.3.
|
Register 7584
|
12.4.
|
Participations 7584
|
12.5.
|
Certain Pledges 7685
|
12.6.
|
Competitors 7685
|
ARTICLEArticle XIII NOTICES
|
877
|
13.1.
|
Giving Notice 877
|
13.2.
|
Change of Address, etc 788
|
13.3.
|
Platform. 788
|
ARTICLEArticle XIV COUNTERPARTS
|
7988
|
ARTICLEArticle XV Guaranty
|
7988
|
15.1.
|
Guaranty; Limitation of Liability 7988
|
15.2.
|
Guaranty Absolute 809
|
15.3.
|
Rights Of Lenders 8190
|
15.4.
|
Certain Waivers and Acknowledgements 8190
|
15.5.
|
Obligations Independent 8291
|
15.6.
|
Subrogation 8291
|
15.7.
|
Termination; Reinstatement 8291
|
15.8.
|
Stay Of Acceleration 8392
|
15.9.
|
Condition Of Borrowers 8392
|
15.10.
|
Guaranty Supplements 8392
|
15.11.
|
Irish Limitation 92
|
ARTICLEArticle XVI miscellaneous;
|
893
|
16.1.
|
Choice of Law 893
|
16.2.
|
Consent to Jurisdiction, etc 893
|
16.3.
|
Designated Subsidiaries 894
|
16.4.
|
Substitution of Currency 895
|
16.5.
|
WAIVER OF JURY TRIAL 8796
|
(a)
|
a bank which is authorized or licensed (pursuant to section 9 or section 9A of the Central Bank Act 1971 of Ireland) to carry on banking business in Ireland and which is carrying on a bona fide banking business in Ireland (for the purposes of section 246(3) TCA) and whose Lending Installation is located in Ireland;
|
(a)
|
a building society (within the meaning of section 256(1) TCA) which is carrying on a bona fide banking business in Ireland (for the purposes of section 246(3) TCA) and whose Lending Installation is located in Ireland;
|
(b)
|
an authorized credit institution (under the terms of Directive 2013/36/EU) which has duly established a branch in Ireland, having made all necessary notifications to its home state competent authorities (as required under Directive 2013/36/EU and, where applicable, under Council Regulation No 1024/2013) in relation to its intention to carry on banking business in Ireland, and such credit institution is carrying on a bona fide banking business in Ireland (for the purposes of section 246(3) TCA) and whose Lending Installation is located in Ireland;
|
(c)
|
a body corporate:
|
(i)
|
which, by virtue of the law of a Qualifying Jurisdiction, is resident in the Qualifying Jurisdiction for the purposes of tax and that jurisdiction imposes a tax that generally applies to interest receivable in that jurisdiction by companies from sources outside that jurisdiction; or
|
(i)
|
which is a US corporation which is incorporated in the United States and is taxed in the United States on its worldwide income;
|
(ii)
|
which is a US limited liability company where (I) the ultimate recipients of the interest would themselves be Irish Qualifying Lenders under sub-paragraphs (i), (ii) or (iv) of this paragraph (d), and (II) business is conducted through the US limited liability company for market reasons and not for tax avoidance purposes; or
|
(iii)
|
where the interest under a Loan Document:
|
(1)
|
is exempted from the charge to Irish income tax under an Irish Tax Treaty in force on the date the interest is paid; or
|
(1)
|
would be exempted from the charge to Irish income tax if an Irish Tax Treaty which has been signed but is not yet in force had the force of law on the date the interest is paid,
|
(d)
|
a body corporate which advances money in the ordinary course of a trade which includes the lending of money and whose Lending Installation is located in Ireland where the interest on the advance under a Loan Document is taken into account in computing the trading income of such body corporate and such body corporate has complied with the notification requirements under section 246(5) TCA;
|
(e)
|
a qualifying company (within the meaning of section 110 TCA) whose Lending Installation is located in Ireland;
|
(f)
|
an investment undertaking (within the meaning of section 739B TCA) whose Lending Installation is located in Ireland; or
|
(g)
|
an Irish Treaty Lender.
|
(a)
|
the Aon Retirement Plan (composed of the following sections; Aon Alexander & Alexander UK Pension Scheme Section, the Aon Bain Hogg Pension Scheme Section, the Aon UK Pension Scheme Section, the Hewitt Pension Fund Section and the Hewitt Pension & Life Assurance Plan Section), the Aon Minet Group Pension & Life Assurance Scheme, the Jenner Fenton Slade 1980 Pension Scheme, Industry Wide Coal Staff Superannuation Scheme, the Aon McMillen Pension Scheme, (in each case, as amended from time to time);
|
(a)
|
a member state of the European Communities other than Ireland;
|
(b)
|
a jurisdiction with which Ireland has entered into an Irish Tax Treaty that has the force of law; or
|
(c)
|
a jurisdiction with which Ireland has entered into an Irish Tax Treaty where that treaty will (on completion of necessary procedures) have the force of law.
|
(A)
|
each Lender and Administrative Agent that is a U.S. Person shall deliver to each U.S. Borrower and the Administrative Agent, on or prior to the date it becomes a party to this Agreement (and from time to time thereafter upon the reasonable request of any U.S. Borrower or the Administrative Agent), executed originals of IRS Form W-9 certifying that it is exempt from U.S. federal backup withholding tax;
|
(B)
|
each Non-U.S. Lender shall, to the extent it is legally entitled to do so, deliver to the U.S. Borrowers and the Administrative Agent (in such number of copies as shall be requested by the recipient), on or prior to the date on which it becomes a party to this Agreement (and from time to time thereafter upon the reasonable request of any U.S. Borrower or the Administrative Agent), whichever of the following is applicable:
|
(i)
|
in the case of a Non-U.S. Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed originals of IRS Form W-8BEN or W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;
|
(iii)
|
in the case of a Non-U.S. Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit F-1 to the effect that such Non-U.S. Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10-percent shareholder” of any U.S. Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed originals of IRS Form W-8BEN or W-8BEN-E; or
|
(iv)
|
to the extent a Non-U.S. Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of Exhibit F-2 or Exhibit F-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Non-U.S. Lender is a partnership and one or more direct or indirect partners of such Non-U.S. Lender are claiming the portfolio interest exemption, such Non-U.S. Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit F-4 on behalf of each such direct and indirect partner;
|
(D)
|
if a payment made to a Lender or the Administrative Agent under this Agreement or any other Loan Document would be subject to U.S. federal withholding tax imposed by FATCA if it were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender or Administrative Agent shall deliver to the U.S. Borrowers and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by any U.S. Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by any U.S. Borrower or the Administrative Agent as may be necessary for the U.S. Borrowers and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender or Administrative Agent has complied with such Lender’s or Administrative Agent’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.
|
*
|
In the event of a split rating, the applicable rating shall be deemed to be higher of the two ratings; provided, if the difference between the two ratings is greater than one sub-grade, the applicable rating shall be deemed to be one sub-grade below the higher of the two ratings, with Level I being the highest rating and Level V being the lowest rating.
|
By:
|
Name: Title: |
1.
|
Commitment; Assumption. Each New Lender (it being understood that any existing Lender shall constitute a “New Lender” hereunder to the extent of any increase in its existing Commitment) hereby assumes, subject to and in accordance with the terms set forth in this Assumption and the Credit Agreement, as of the Effective Date as set forth below, a Commitment in the amount identified below (as to each New Lender, its “Assumed Interest” and, collectively, the “Assumed Interests”).
|
(a)
|
New Lenders:
|
(b)
|
Borrowers: Aon plc and Aon Corporation
|
(c)
|
Administrative Agent: Citibank, N.A., as the Administrative Agent under the Credit Agreement
|
(d)
|
Credit Agreement: The Five-Year Credit Agreement dated as of October 19, 2017 among Parent, Aon Corporation, the Lenders parties thereto, the Administrative Agent and the other agents parties thereto
|
(e)
|
Effective Date: February 27, 2020
|
(f)
|
Assumed Interest: The amount set forth opposite such New Lender’s name in Schedule 1 attached hereto.
|
2.
|
Lender Certifications. Each New Lender (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it meets all the requirements to be an assignee under Section 12.2 of the Credit Agreement (subject to such consents, if any, as may be required thereunder), (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of its Assumed Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by its Assumed Interest and either it, or the Person exercising discretion in making its decision to acquire its Assumed Interest, is experienced in acquiring assets of such type, (v) it has received a copy of the Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent financial statements delivered pursuant to Section 6.1 thereof, as applicable, and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this Assumption and to purchase its Assumed Interest, (vi) it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Assumption and to commit to its Assumed Interest, and (vii) if it is a Lender that is not incorporated under the laws of the United States of America or a state thereof, attached to this Assumption is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by such New Lender; and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.
|
3.
|
Parent Certifications. By its execution of this Assumption, Parent hereby certifies that as of the Effective Date:
|
(a)
|
There exists no Default or Unmatured Default and none would result from the Commitment Increase.
|
(b)
|
The representations and warranties contained in Article V of the Credit Agreement are true and correct (in all respects to the extent qualified by “material” or “material adverse effect” and in all material respects to the extent not so qualified) as of the Effective Date immediately after giving effect to such Commitment Increase (or, to the extent that any such representation and warranty specifically refers to an earlier date, as of such earlier date).
|
4.
|
Assumption Fee. By its execution of this Assumption, Parent hereby agrees to pay to the Administrative Agent (for the account of the New Lenders party hereto) as fee compensation for each New Lender an amount equal to 0.07% of the aggregate principal amount of the Assumed Interests, which shall be divided among such New Lenders based on their pro rata share of the aggregate Assumed Interests on the Effective Date. The Assumption Fee will be fully earned, due and payable on, and subject to the occurrence of, the Effective Date.
|
5.
|
Recordation of the New Loans. Upon execution and delivery hereof and fulfillment of the other conditions set forth in Section 2.19(c) of the Credit Agreement, Administrative Agent will record the Assumed Interests as Commitments in the Register and promptly provide a copy of the Register to Parent.
|
6.
|
Enforceability. This Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. The Credit Agreement and the other Loan Documents are hereby ratified and affirmed in all respects, and this Assumption shall constitute a Loan Document for all purposes thereof.
|
7.
|
Counterparts. This Assumption may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assumption by telecopy shall be effective as delivery of a manually executed counterpart of this Assumption.
|
8.
|
Governing Law. This Assumption shall be governed by, and construed in accordance with, the law of the State of New York.
|
New Lender
|
Assumed Interest
|
||
Citibank, N.A.
|
|
$40,000,000
|
|
The Bank of New York Mellon
|
|
$32,000,000
|
|
PNC Bank, National Association
|
|
$60,000,000
|
|
Bank of Montreal
|
|
$50,000,000
|
|
JPMorgan Chase Bank, N.A.
|
|
$50,000,000
|
|
Barclays Bank PLC
|
|
$40,000,000
|
|
ING Bank N.V., Dublin Branch
|
|
$40,000,000
|
|
U.S. Bank National Association
|
|
$38,000,000
|
|
|
|
||
Total:
|
|
$350,000,000.00
|
|
1.
|
Transition. The Company will continue to employ Executive throughout the Transition Period, subject to the terms and conditions of this Agreement. During the Transition Period, Executive shall no longer be an officer (i.e., Named Executive Officer, Section 16 Officer, or any other type of officer) or director of the Company or any of its affiliates, parent companies, or subsidiaries (collectively, “Aon”) or a member of the Company’s Governance and Policy Team; instead, Executive’s title will be Special Advisor to the CEO. Notice pursuant to Section 2(b) of the SE Plan shall be deemed to be given as of the Effective Date.
|
2.
|
Transition Period Salary, Benefits, and Duties.
|
a.
|
Transition Period Salary. During the Transition Period, the Company will continue to pay the Executive a base salary of $1,000,000 per year (the “Base Salary”), payable in accordance with the Company’s payroll policies. Executive shall not be entitled to any annual bonus or incentive payment; and Executive shall not be entitled to any additional long-term incentive award under the Aon plc Amended and Restated 2011 Incentive Plan (the “2011 Incentive Plan”).
|
b.
|
Transition Benefits. During the Transition Period, the Executive will continue to be entitled to participate in the Company’s regular employee and executive benefit plans commensurate with his pre-Transition Period position, in accordance with the terms of such plans, subject to the provisions of Section 2(b) of the SE Plan. Nothing in this Agreement will require the Company to establish, maintain, or continue any of the benefits already in existence or hereafter adopted for employees of the Company, and nothing in this Agreement will restrict the right of the Company to amend, modify, or terminate such programs. For the avoidance of doubt, Executive’s benefits during the Transition Period shall include the Northwestern Executive Health program, but shall not include any payment with respect to country club dues or any Company assurance of coverage under the United Airlines Global Services program.
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c.
|
Transition Duties. During the Transition Period, Executive will focus his efforts on transition of his duties and responsibilities by making himself available as needed from time-to-time as directed by Aon’s CEO (collectively, the “Duties and Responsibilities”). The Duties and Responsibilities are not expected to require Executive’s presence in an Aon office. During the Transition Period, Executive will have access to administrative support services substantially similar to those provided to Executive immediately prior to the Transition Period, including, to the extent possible, the assistance of Executive’s customary executive assistant.
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d.
|
Expense Policy. Executive shall continue to be subject to the Company’s standard expense policy and travel management programs. It is anticipated that Executive shall have business trips to the Company’s offices in New York, London, Latin America and Asia (each a “Business Trip”) and each Business Trip is agreed to by the Company and shall be covered subject to the normal terms of the Company’s standard expense policy and travel management programs. Each Business Trip may be taken at any time through June 30, 2021, provided Executive is not employed by an entity (other than the Company) at the time of such Business Trip. With the exception of the terms for the Business Trips per this Section 2.d., after the Separation Date, Executive shall not be subject to, or able to incur or submit expenses under, the Company’s standard expense policy or travel management programs.
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e.
|
Transition Bonus. In exchange for the Executive carrying out the Duties and Responsibilities and foregoing other paid employment opportunities during the Transition Period, as well as the Employee agreeing to the Restrictive Covenants in Section 6, and executing and returning (and not revoking) a general release of claims agreement in the form attached hereto as Exhibit A within 21 calendar days of, but not before, the Separation Date (the “Separation Release”) (the release provided per this Agreement, the “Agreement Release”), he shall receive a special cash bonus in the amount of $7,000,000 (the “Transition Bonus”), subject to applicable withholdings. The Transition Bonus will be payable in the following installments, with the installments specified in Sections 2(e)(i) & (ii) conditioned upon the Company’s receipt of an executed Agreement Release and the installment specified in Sections 2(e)(iii) conditioned upon the Company’s receipt of an executed Separation Release: (i) $2,000,000 payable on May 15, 2020; and (ii) $3,000,000 payable on January 15, 2021; and (iii) $2,000,000 payable on June 30, 2021; provided, however, that should the Executive violate the provisions of Section 6 of this Agreement, as determined by the Company in its reasonable discretion, then the Company, in addition to any other remedy available for breach of Section 6, shall be entitled to immediately cease paying any further installments of the Transition Bonus.
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f.
|
Legal Fees. The Company agrees to compensate Executive for his legal or other professional fees in connection with the negotiation and execution of this Agreement up to a maximum amount of $40,000. Payment shall be made within thirty (30) days of the Company’s receipt of a payment request from the Executive.
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g.
|
Tax Audit. The Company acknowledges that Executive is subject to an on-going audit of his personal taxes and that the Company has provided Executive with the services of KPMG in connection with such audit. The Company will continue to provide Executive the services of KPMG in connection with such audit (both during the Transition Period and thereafter, as needed), until the audit is completed and closed. It is anticipated that the provision of such services by KPMG will not result in imputed income to Executive, but, to the extent the provision of such services does result in imputed income to Executive, Executive shall be provided tax gross-up payments as needed to keep Executive tax neutral.
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3.
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Separation.
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a.
|
Separation on the Separation Date. This Agreement and the Executive’s employment thereunder will terminate on the Separation Date, or an earlier date pursuant to Section 3(c) of this Agreement. Without limiting the Executive’s entitlement to the payments and benefits provided in this Agreement, such termination of the Executive’s employment shall be deemed a termination of employment by mutual consent between the Executive and the Company or without cause if more favorable to the Executive. The Company will pay the Executive all accrued but unpaid base salary and vested benefits as of the Separation Date or an earlier date pursuant to Section 3(c) of this Agreement, payable in accordance with the applicable Company policy, plan, or program, and unreimbursed business expenses incurred in accordance with Section 2(d). Executive’s eligibility to participate in the Company’s employee benefit plans generally available to senior employees of the Company, including without limitation health care plans, shall terminate as of the Separation Date or an earlier date pursuant to Section 3(c) of this Agreement, subject to any applicable rights pursuant to COBRA.
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b.
|
Death or Disability. During the Transition Period, this Agreement and the Executive’s employment hereunder will terminate upon the death or total disability of the Executive (as defined under the Aon Long Term Disability Plan or its successor plan). In the event of such a termination, the Company will pay or provide the Executive (or his Beneficiary, as defined in Section 7): (i) his Base Salary for the remaining balance of the Transition Period; (ii) any vested benefits as of the date of the termination under this Section 3(b); (iii) any unreimbursed business expenses incurred in accordance with Section 2(d); and (iv) any unpaid portion of the Transition Bonus. For the avoidance of doubt, any other benefits shall cease as of the Executive’s termination under this Section 3(b).
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c.
|
By the Executive. During the Transition Period, this Agreement may be terminated by the Executive on no less than sixty (60) days advance notice by the Executive. The notice will specify the date that this Agreement shall terminate; provided, however, (i) that the Company may require the Executive to leave Company premises immediately upon giving of notice; (ii) that the Executive’s Base Salary and benefits entitlements shall cease as of the termination date specified in his notice pursuant to this Section 3(c) instead of on the Separation Date but the Separation Date otherwise shall be unchanged; (iii) any portion of the Transition Bonus that remains unpaid pursuant to Section 2(e) shall be forfeited; and (iv) the treatment of Executive’s equity specified in Section 4 shall not be impacted by Executive’s termination of the Agreement prior to the Separation Date. In the event of such a termination, the Company will pay the Executive all accrued but unpaid Base Salary and vested benefits as of the termination date, payable in accordance with the applicable Company policy, plan, or program, and any unreimbursed business expenses incurred in accordance with Sections 2(d).
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d.
|
For Cause. During the Transition Period, the Company may terminate this Agreement for Cause, by written notice of termination given to the Executive setting forth the basis for such termination and giving Executive an opportunity to cure within thirty (30) days. If the Executive does not effect a cure within this time period, as determined by the Company in its reasonable discretion, the termination shall become effective. For the purposes of this Agreement, “Cause” will mean the Executive’s: (i) performing a deliberate act of dishonesty, fraud, theft, embezzlement, or misappropriation involving the Executive’s employment with the Company, or breach of the duty of loyalty to the Company; (ii) performing an act of race, sex, national origin, religion, disability, or age-based discrimination, or sexual harassment, which after investigation, counsel to the Company reasonably concludes will result in liability being imposed on the Company and/or the Executive; (iii) material violation of Company policies and procedures including, but not limited to, the Aon Code of Business Conduct; (iv) material non-compliance with the terms of this Agreement, including without limitation the non-disparagement obligations of Section 9(a), or any other agreement between the Executive and Aon; or (v) performing any criminal act resulting in a criminal felony charge brought against the Executive or a criminal conviction of the Executive (other than a conviction of a minor traffic violation). In the event of a termination for Cause, the Company will only be required to pay or provide to the Executive all accrued but unpaid Base Salary and vested benefits as of the date of such termination, payable in accordance with the applicable Company policy, plan, or program.
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e.
|
Effecting Termination on the Separation Date. As of the Effective Date, the Executive agrees that the Secretary of the Company may, as an irrevocable proxy and in the Executive’s name and stead, execute all documents and things which the Company deems necessary and desirable to effect the Executive’s resignation as an officer or director of Aon.
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f.
|
Obligations Upon Separation. Upon the Separation Date, the obligations of the parties under this Agreement and the Prior Agreements will cease, except as otherwise explicitly set forth in this Agreement (including without limitation under Sections 2, 4, 5, 6, 8 and 9). The Executive will continue to be indemnified and held harmless to the maximum extent provided under the Company’s charter, by-laws and applicable law for his acts and omissions to act through the Separation Date, which indemnification shall survive his termination of employment. Executive will continue to be insured under policies of directors and officers liability insurance to the fullest extent provided for former officers or directors under the applicable policy(ies); provided, such insurance coverage may be terminated if Aon terminates coverage generally for all officers and directors. Anything in this Agreement or its Exhibits to the contrary notwithstanding the Executive’s right to make any claim under any director and officer liability insurance coverage provided by the Company for acts or omissions by Executive while an executive officer of the Company or any affiliate shall survive the Separation Date.
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g.
|
Copy of Restrictive Covenants. The Executive agrees that, prior to the commencement of any new employment in the Business (as defined below), the Executive will furnish the prospective new employer with a complete and accurate copy of the text of the restrictive covenant obligation the Executive has to Aon (the “Restrictive Covenant Text”) under Section 6 of this Agreement and under the 2011 Incentive Plan. The Executive also agrees that the Company may advise any prospective new employer of the Executive of the existence and terms of such restrictive covenants and furnish the prospective new employer with a copy of the Restrictive Covenant Text.
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4.
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Equity Awards. The Executive’s equity awards issued under the 2011 Incentive Plan in connection with the Leadership Performance Program (“LPP”) for the 2018-2020 performance cycle (“LPP13”), and the 2019-2021 performance cycle (“LPP14”) will continue to be governed by the terms and conditions of the applicable plan documents; provided, however, that notwithstanding the foregoing provisions of this Section 4 and anything to the contrary contained in the 2011 Incentive Plan, LPP13, or LPP14 plan documents, and contingent upon the Executive’s (a) continued compliance with the Restrictive Covenants, and (b) execution and return (and non-revocation) of the Separation Release, the Executive’s LPP13 and LPP14 awards shall be determined and paid as though the Executive had continued employment with the Company through any applicable vesting and payment date. The Executive’s awards under the Incentive Stock Plan (“ISP”) will continue to be governed by the terms and conditions of the applicable plan documents.
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5.
|
Acknowledgments. The Executive understands and agrees that he would not otherwise be eligible for, or entitled to, the payments, plan treatment, or other employment benefits set forth in Sections 2 and 4 above, if he did not enter into this Agreement. Further, by signing this Agreement, the Executive acknowledges and agrees that he is not entitled to, and waives any claims with respect to, any additional payments and/or benefits that are not specifically identified in this Agreement; this acknowledgement and waiver includes, but is not limited to, any benefits under the Prior Agreements, the SE Plan, any additional payments related to annual incentive plans, and/or any applicable Aon bonus or incentive plan, except for those benefits in which he has a vested right pursuant to the terms of the applicable incentive, retirement, and other employee benefit plans in which he is a participant and applicable law. Executive also agrees that he will execute the Separation Release.
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6.
|
Restrictive Covenants.
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a.
|
General. The Executive acknowledges that in the course of his employment with the Company and any predecessor or affiliated company, the Executive has become familiar with trade secret and other confidential information concerning Aon. The Executive further acknowledges and agrees that his services as a senior executive of the Company have been, and are, of special, unique, and extraordinary value to Aon, and that his material employment duties and responsibilities (including without limitation with respect to Aon strategic and other business operations, clients, prospective clients, and other employees) are global in nature and span geographic areas that extend well beyond the locations in which the Executive has been physically employed and resided. The Executive further acknowledges and agrees that it therefore is reasonable to protect Aon against certain competitive activities by the Executive for a limited period of time after the Executive leaves employment to protect Aon’s legitimate business interests in all of the geographic areas in which Aon does business, and that the covenants contained in Section 6 are necessary for the protection of Aon and are reasonably limited with respect to the activities prohibited, duration, geographical scope and their effect on the Executive and the public.
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b.
|
Confidential Information. The Executive acknowledges that Aon’s business depends to a significant degree upon the possession of confidential, proprietary and trade secret information which is not generally known to others, and that the profitability of the Business of Aon requires that this information remain proprietary to Aon. The Executive recognizes that, by virtue of the Executive’s employment by the Company and/or its affiliates, and to assist the Executive in the solicitation, production and servicing of client business, the Executive has had otherwise prohibited access to such information. This information (hereinafter referred to as “Confidential Information”) includes, without limitation: lists of clients and prospective clients; contract terms and conditions; client information relating to services, insurance, benefits programs, executives, finances, and compensation; copyrighted materials; corporate, management and business plans and strategies; compensation and revenues; methods and strategies of marketing; market research and data; technical know-how; computer software and manuals; policies and procedures; and the conduct of the affairs of Aon. Confidential Information does not include any information that lawfully is or has become generally or publicly known other than through the Executive’s breach of this Agreement or a breach by another person of some other obligation. The Executive will not disclose or use during after his employment, any Confidential Information, except as required in the course of his employment or as provided by applicable law or in Section 10 below.
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c.
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Noncompetition. The Executive agrees that through the period ending February 28, 2021 (the “Noncompetition Period”) the Executive will not work in any manner, directly or indirectly, through any person, firm or corporation, alone or as a member of a partnership or as an officer, director, stockholder, investor, or employee of, or as a consultant for the following entities, or any affiliates thereof: Alight Solutions, Alliant Insurance Services, Inc., Marsh & McLennan Companies, Inc., Arthur J. Gallagher & Co., Lockton Companies, Inc., and Willis Towers Watson.
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d.
|
Other Restrictive Covenants. Subject to the use of February 28, 2020 as the commencement of any “Restricted Period” (or similar term), the Executive further acknowledges and agrees that, in addition to the provisions of this Section 6, he remains subject to certain restrictive covenants by virtue of his receipt of certain stock benefits under the 2011 Incentive Plan.
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e.
|
Inventions. The Executive hereby assigns to the Company the Executive’s entire right, title and interest in and to all discoveries and improvements, patentable or otherwise, trade secrets and ideas, writings and copyrightable material, which may be conceived by the Executive or developed or acquired by the Executive during the Executive’s employment and which may pertain directly or indirectly to the business of the Company or any of its subsidiaries or affiliates, and which the Executive hereby agrees is work for hire performed in the scope of the Executive’s employment. The Executive agrees to disclose fully all such developments to the Company upon its request, which disclosure will be made in writing promptly following any such request. The Executive will upon the Company’s request, execute, acknowledge and deliver to the Company all instruments and do all other acts which are necessary or desirable to enable the Company or any of its subsidiaries or affiliates to file and prosecute applications for, and to acquire, maintain and enforce, all patents, trademarks, and copyrights in all countries. The Executive acknowledges and agrees that the Executive hereby is and has been notified by the Company, and understands, that the foregoing provisions of this Section 6(e) do not apply to an invention for which no equipment, supplies, facilities or trade secret information of the Company or any of its parent companies, subsidiaries or other affiliates was used and which was developed entirely on the Executive’s own time, unless: (i) the invention relates (x) to the business of the Company or any of its subsidiaries or other affiliates or (y) to the Company’s or any of its subsidiaries’ or other affiliates’ actual or demonstrably anticipated research and development, or (ii) the invention results from any work performed by the Executive for the Company or any of its subsidiaries or other affiliates.
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f.
|
Exceptions. Nothing in this Section 6 will prohibit the Executive from being (i) a stockholder in a mutual fund or a diversified investment company; (ii) a passive owner of not more than two percent of the outstanding stock of any class of a corporation, any securities of which are publicly traded, so long as the Executive has no active participation in the business of such corporation; and (iii) a member of boards of directors of public for-profit companies or non-profit organizations that are not engaged in the Company’s Business, as that term is defined in the Leadership Performance Program awards under the 2011 Incentive Plan. For the avoidance of doubt, under that definition, “Business” shall mean the business of providing conventional and alternative risk management products and services covering the business of insurance brokerage, reinsurance brokerage, benefits consulting, compensation consulting, human resources consulting, human resources and benefits outsourcing management, investigatory and security consulting, managing underwriting and related services, including accounting, actuarial, claims management and handling, and information systems on behalf of commercial and individual clients which are national and international and are not confined to any geographic area.
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g.
|
Reformation. If, at any time of enforcement of this Section 6, a court holds that the restrictions stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum period, scope, or geographical area reasonable under such circumstances will be substituted for the stated period, scope or area and that the court will be allowed to revise the restrictions contained herein to cover the maximum period, scope, and area permitted by law. This Agreement will not authorize a court to increase or broaden any of the restrictions of this Section 6.
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h.
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Consideration; Breach. The Company and the Executive agree that the payments to be made by the Company to the Executive pursuant to Section 2 hereof will be made and provided expressly in consideration of the Executive’s agreements contained in, and continued compliance with, this Section 6. The Executive acknowledges and agrees that the Company would not have agreed to provide any of the payments in Section 2 but for the Executive’s promises in this Section 6. In the event that the Executive has committed a material breach of any provision of this Section 6, on written notice to the Executive setting forth the basis for such determination, such notice provided to the Executive 21 days in advance of any action pursuant to this Section 6(h) or within seven days of the Company becoming aware of the action constituting a material breach, whichever is later, without limiting or otherwise affecting any other available remedy to the Company or any of its subsidiaries or affiliates, the Company will be entitled, subject to the duty of good faith, immediately to terminate making all remaining payments pursuant to Section 2 hereof, and upon such termination the Company will have no further liability to the Executive under this Agreement; provided, however, that if a court of law determines that no such material breach occurred, the Company then will be obligated to make such payments in a timely manner together with interest compounded monthly at the prime rate (as published in The Wall Street Journal online) as in effect from time to time commencing on the date such payments cease. The Executive further acknowledges and agrees that a material breach by him of any provision of Section 6 of this Agreement will result in immediate and irreparable harm to the Company and any of its subsidiaries or affiliates for which full damages cannot readily be calculated and for which damages are an inadequate remedy. Accordingly, the Executive agrees that the Company and its affiliates shall be entitled to injunctive relief to prevent any such actual or threatened breach or any continuing breach by the Executive (without posting a bond or other security), without limiting any other remedies that may be available to them. The parties agree that the prevailing party in any such dispute shall be entitled to reimbursement from the other party of all costs and expenditures, including but not limited to reasonable attorneys’ fees and court costs, incurred in connection with any action relating to enforcement of Section 6 of this Agreement.
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i.
|
Return of Property. Upon the Separation Date or upon the Company’s request (whichever is earlier), the Executive will promptly return to the Company all Confidential Information and all materials and all copies or tangible embodiments of materials involving Confidential Information, and all other Aon property, in the Executive’s possession or control, except as otherwise provided by law or in Section 10 below. Notwithstanding the foregoing, Executive shall retain his phone, phone number, iPad, and laptop, subject to satisfaction of necessary security protocols.
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7.
|
Mergers and Consolidations; Assignability. The rights and obligations under this Agreement will inure to the benefit of and be binding upon the Company and its successors and assigns so long as any assignee, successor, or transferee of the Company has provided an express written and unconditional assumption of the Company’s obligations under this Agreement. This Agreement will not be assignable by the Executive, but in the event of the Executive’s death it will be binding upon and inure to the benefit of the Executive’s legal representatives to the extent required to effectuate its terms. In the event of the Executive’s death after terminating employment and before all payments and benefits otherwise due to him had been paid to him (had he not died), such amounts will be paid to the Executive’s designated beneficiary (per a written designation signed by the Executive and received by the Company prior to the Executive’s death), or, if none, the Executive’s surviving spouse, or, if none, the Executive’s estate (as applicable, the “Beneficiary”).
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8.
|
Release.
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a.
|
For and in consideration of the payments and benefits provided, or to be provided, to the Executive under this Agreement, the Executive, and anyone claiming through him or on his behalf, hereby waives and releases the Released Parties (as defined below) with respect to any and all claims, whether currently known or unknown, that the Executive now has or ever has had against a Released Party arising from or related to any act, omission, or thing occurring or existing at any time prior to or on the date on which the Executive signs this Agreement, except as otherwise expressly provided in this Agreement. “Released Parties” include (A) the Company and its past, present, and future parents, divisions, subsidiaries, partnerships, affiliates, and other related entities, (B) each of the foregoing entities’ and persons’ past, present, and future owners, trustees, fiduciaries, administrators, shareholders, directors, officers, partners, members, associates, agents, executives, employees, and attorneys, and (C) the predecessors, successors and assigns of each of the foregoing persons and entities. Without limiting the generality of the foregoing, the claims waived and released by the Executive hereunder include, but are not limited to:
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i.
|
All claims arising out of or related in any way to his employment, compensation, other terms and conditions of employment, or termination from employment, including, without limitation, claims with respect to any advance notice of termination and claims arising out of the Prior Agreements or any other employment agreements, incentive plans, severance plans or policies, stock plans or policies, or any other employee benefit plans;
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ii.
|
All claims that were or could have been asserted by the Executive or on his behalf: (A) in any federal, state, or local court, commission, or agency; or (B) under any common law theory (including without limitation all claims for breach of contract (oral, written or implied), wrongful termination, defamation, invasion of privacy, infliction of emotional distress, tortious interference, fraud, estoppel, unjust enrichment, and any other contract, tort or other common law claim of any kind); and
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iii.
|
All claims that were or could have been asserted by the Executive or on his behalf under: (A) the Age Discrimination in Employment Act (the “ADEA”) and the Older Worker Benefit Protection Act (the “OWBPA”); and (B) any other federal, state, local, employment, services or other law, regulation, ordinance, constitutional provision, executive order or other source of law, including without limitation under any of the following laws, as amended from time to time: Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 1981 & 1981a, the Americans with Disabilities Act, the Equal Pay Act, Executive Retirement Income Security Act, the Lilly Ledbetter Fair Pay Act of 2009, the Family and Medical Leave Act, the Worker Adjustment and Retraining Notification Act and all applicable state, county or other local fair employment laws.
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b.
|
Exceptions. Notwithstanding the foregoing, the releases and waivers in this Agreement shall not apply to any claim: (i) for unemployment or workers’ compensation; (ii) for vested benefits under any employee benefit plan; (iii) that by law is non-waivable; (iv) for the Transition Bonus or any other payments or benefits set forth in this Agreement; (v) as a stockholder of Aon plc; or (vi) for indemnification pursuant to Section 3(f) of this Agreement or applicable law and for coverage as an insured under directors and officers liability insurance.
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c.
|
No Further Obligations; Additional Representations. In the event of any further proceedings based upon any released matter, Aon shall have no further monetary or other obligation of any kind to the Executive, and the Executive hereby waives any such monetary or other recovery (provided that nothing limits the Executive’s rights under Section 10 below). The Executive represents and warrants that: (i) there has not been filed by the Executive or on the Executive’s behalf any legal or other proceedings against any of the Released Parties (provided, however, that the Executive need not disclose to the Company, and the foregoing representation and warranty in this subpart do not apply to, conduct or matters described in Section 10 below); (ii) the Executive is the sole owner of the claims that are released in this Section 8; (iii) none of these claims has been transferred or assigned or caused to be transferred or assigned to any other person, firm or other legal entity; and (iv) the Executive has the full right and power to grant, execute, and deliver the releases, undertakings, and agreements contained in this Agreement.
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d.
|
Specific Rights Under OWBPA. They Executive understands and agrees that: (A) this is the full and final release of all claims against the Company and the other Released Parties through the date he signs this Agreement; (B) the Executive knowingly and voluntarily releases claims hereunder for valuable consideration; (C) the Executive hereby is and has been advised of his right to have his attorney review this Agreement before signing it; (D) the Executive has twenty-one (21) days to consider whether to sign this Agreement; and (E) the Executive may, at his sole option, revoke this Agreement upon written notice within seven (7) days after signing it. This Agreement will not become effective until this seven (7) day period has expired and will be void if he revokes it within such period. Although the Executive is releasing claims that he may have under the ADEA and the OWBPA, he understands that he may challenge the knowing and voluntary nature of this Agreement under the OWBPA and the ADEA before a court, the EEOC, the NLRB, or any other federal state or local agency charged with the enforcement of any employment laws.
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9.
|
Future Conduct.
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a.
|
Each of the Executive and the Company agree that the Executive, on the one hand, the Company (through any authorized public statement), on the other, shall refrain from all conduct, verbal or otherwise, that disparages or damages the reputation, goodwill, or standing in the community of the other such party or, with respect to the Executive’s conduct any of the other Released Parties, provided that nothing herein shall prohibit the Executive from exercising his rights detailed in Section 10 or prohibit either party from giving truthful testimony or evidence to a governmental entity, or if properly subpoenaed or otherwise required to do so under applicable law.
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b.
|
The Executive agrees that, as of the Separation Date, he will have no present or future right to employment with the Company or any of the other Released Parties and will not apply for employment with any of them.
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c.
|
Subject to and except as otherwise provided in Section 10 of this Agreement: (i) the Executive shall cooperate fully with the Company and the other Released Parties in transitioning his responsibilities as requested by the Company; (ii) the Executive agrees, subject to the advice of legal counsel, to voluntarily make himself available to the Company and its legal counsel, at the Company’s request without the necessity of obtaining a subpoena or court order, in the Company’s investigation, preparation, prosecution and/or defense of any actual or potential legal proceeding, regulatory action, or internal matter; and (iii) subject to the advice of legal counsel, the Executive agrees to provide any information reasonably within the Executive’s recollection. The Executive’s obligation to cooperate hereunder shall include, without limitation, meeting and conferring with such persons at such times and in such places as the Company and the other Released Parties may reasonably require and not unreasonably interfering with the Executive’s other professional endeavors, and giving truthful evidence and truthful testimony and executing and delivering to the Company and any of the other Released Parties any truthful papers reasonably requested by any of them. Notwithstanding anything to the contrary in Section 2(d) of this Agreement, the Executive shall be reimbursed for reasonable out-of-pocket expenses, including attorney’s fees, that he incurs in rendering cooperation during the Transition Period or after the Separation Date pursuant to this Section 9.
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10.
|
Protected Rights. Nothing in this Agreement is intended to limit in any way the Executive’s right or ability to report possible violations of law or regulation to, or file a charge or complaint with, the U.S. Securities and Exchange Commission, the U.S. Equal Employment Opportunity Commission, the National Labor Relations Board, or other federal, state or local agencies or commissions (collectively, “Government Agencies”). The Executive further understands that nothing in this Agreement limits the Executive’s ability to communicate with any Government Agencies or otherwise participate in any investigation or proceeding that may be conducted by any Government Agencies, including providing documents or other information, without notice to the Company. Nothing in this Agreement shall limit the Executive’s ability to disclose in confidence trade secrets to Government Agencies, or to an attorney, for the sole purpose of reporting or investigating a suspected violation of law or to disclose trade secrets in a document filed in a lawsuit or other proceeding, but only if the filing is made under seal and protected from public disclosure. This Agreement does not limit the Executive’s ability to receive an award from a Government Agency for information provided by the Executive to such Government Agency.
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11.
|
Miscellaneous.
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a.
|
Integration; Amendment; Counterparts. Except as is otherwise provided herein, this Agreement contains all of the terms and conditions agreed upon by the parties relating to the subject matter of this Agreement and supersedes all prior and contemporaneous agreements, negotiations, correspondence, undertakings and communications of the parties, whether oral or written, respecting the subject matter of this Agreement. This Agreement may not be amended, altered, or modified without the prior written consent of both parties and such instrument must acknowledge that it is an amendment or modification of this Agreement. This Agreement may be executed in two counterparts, each of which will be deemed an original and both of which together will constitute one and the same instrument. Any signature delivered via .pdf file shall be the same as an original signature.
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b.
|
Waiver. Waiver of any term or condition of this Agreement by any party will not be construed as a waiver of a subsequent breach or failure of the same term or condition, or a waiver of any other term or condition of this Agreement. Any waiver must be in writing.
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c.
|
Captions. The captions in this Agreement are not part of its provisions, are merely for reference and have no force or effect. If any caption is inconsistent with any provision of this Agreement, such provision will govern.
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d.
|
Governing Law. The validity, interpretation, construction, performance, enforcement and remedies of, or relating to, this Agreement, and the rights and obligations of the parties hereunder, will be governed by and construed in accordance with the substantive laws of the State of Illinois, without regard to the conflict of law principles, rules or statutes of any jurisdiction. The parties hereby irrevocably consent to, and agree not to object or assert any defense or challenge to, the jurisdiction and venue of the federal and state courts located in Chicago, Illinois, and agree that any claim which may be brought in a court of law or equity may be brought in any such Chicago, Illinois court.
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e.
|
Severability. Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held by a court of competent jurisdiction to be prohibited or unenforceable for any reason, such provision will be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement.
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f.
|
Notice. All notices given hereunder will be in writing and will be sent by registered or certified mail or delivered by hand and, if intended for the Company, will be addressed to it or delivered to it at its principal office for the attention of the General Counsel. If intended for the Executive, notices will be delivered personally or will be addressed (if sent by mail) to the Executive’s then current residence address as shown on the Company’s records, or to such other address as the Executive directs in a notice to the Company. All notices will be deemed to be given on the date received at the address of the addressee or, if delivered personally, on the date delivered.
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g.
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Code Section 409A. The parties intend that this Agreement and the benefits provided hereunder be interpreted and construed to comply with or be exempt from Section 409A of the Internal Revenue Code of 1986, as amended, and all regulatory and interpretative guidance issued thereunder (“Code Section 409A”) to the extent applicable thereto. The time and form of payment of incentive compensation, disability benefits, severance payments, expense reimbursements and payments of in-kind benefits described herein will be made in accordance with the applicable sections of this Agreement, provided that with respect to termination of employment for reasons other than death, 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 Executive is a “specified employee” under Code Section 409A, such portion of the payment will be delayed until the earlier to occur of the Executive’s death or the date that is six months and one day following the Executive’s termination of employment (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this section will be paid or reimbursed to the Executive in a lump sum, and any remaining payments due under this Agreement will be payable at the same time and in the same form as such amounts would have been paid. Further, if the Executive is a “specified employee” and if any equity-based awards granted to the Executive by the Company, pursuant to this Agreement or otherwise, continue to vest upon the Executive’s termination of employment, and are deemed a “deferral of compensation” (as such term is described under Code Section 409A), the equity-based awards will not be settled or released until the expiration of the Delay Period. For purposes of applying the provisions of Code Section 409A, each separately identifiable amount to which the Executive is entitled will be treated as a separate payment. The time or schedule of any payment or amount scheduled to be paid pursuant to the terms of this Agreement, including but not limited to any restricted stock unit or other equity-based award, payment or amount that provides for the “deferral of compensation” (as such term is described under Code Section 409A), may not be accelerated except as otherwise permitted under Code Section 409A and the guidance and Treasury regulations issued thereunder.
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AON CORPORATION
By: Printed Name: Molly Johnson Its: Vice President & Secretary |
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Michael J. O’Connor |
1.
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Release. The Executive, and anyone claiming through his or on his behalf, hereby waives and releases the Released Parties (as defined below) with respect to any and all claims, whether currently known or unknown, that the Executive now has or ever has had against a Released Party arising from or related to any act, omission, or thing occurring or existing at any time prior to or on the date on which the Executive signs this Release, except as otherwise expressly provided in this Release. “Released Parties” include (A) the Company and its past, present, and future parents, divisions, subsidiaries, partnerships, affiliates, and other related entities, (B) each of the foregoing entities’ and persons’ past, present, and future owners, trustees, fiduciaries, administrators, shareholders, directors, officers, partners, members, associates, agents, executives, employees, and attorneys, and (C) the predecessors, successors and assigns of each of the foregoing persons and entities. Without limiting the generality of the foregoing, the claims waived and released by the Executive hereunder include, but are not limited to:
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a.
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All claims arising out of or related in any way to his employment, compensation, other terms and conditions of employment, or termination from employment, including, without limitation, claims with respect to any advance notice of termination and claims arising out of the Prior Agreements (as defined in the Separation Agreement) or any employment agreements, severance plans or policies, stock plans or policies, or any other employee benefit plans;
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b.
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All claims that were or could have been asserted by the Executive or on his behalf: (A) in any federal, state, or local court, commission, or agency; or (B) under any common law theory (including without limitation all claims for breach of contract (oral, written or implied), wrongful termination, defamation, invasion of privacy, infliction of emotional distress, tortious interference, fraud, estoppel, unjust enrichment, and any other contract, tort or other common law claim of any kind); and
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c.
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All claims that were or could have been asserted by the Executive or on his behalf under: (A) the Age Discrimination in Employment Act (the “ADEA”) and the Older Worker Benefit Protection Act (the “OWBPA”); and (B) any other federal, state, local, employment, services or other law, regulation, ordinance, constitutional provision, executive order or other source of law, including without limitation under any of the following laws, as amended from time to time: Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 1981 & 1981a, the Americans with Disabilities Act, the Equal Pay Act, Employee Retirement Income Security Act, the Lilly Ledbetter Fair Pay Act of 2009, the Family and Medical Leave Act, the Worker Adjustment and Retraining Notification Act and all applicable state, county or other local fair employment laws.
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2.
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Exceptions. Notwithstanding the foregoing, the releases and waivers in this Release shall not apply to any claim: (i) for unemployment or workers’ compensation, (ii) for vested benefits under any employee benefit plan, (iii) that by law is non-waivable, (iv) for the Transition Bonus or any other payments or benefits set forth in the Separation Agreement, (v) as a stockholder of Aon plc, or (vi) for indemnification pursuant to Section 3(f) of the Separation Agreement or applicable law and for coverage as an insured under directors and officers liability insurance.
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3.
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No Further Obligations; Additional Representations. In the event of any further proceedings based upon any released matter, the Company, its affiliates, parent companies, and subsidiaries (collectively, “Aon”) shall have no further monetary or other obligation of any kind to the Executive, and the Executive hereby waives any such monetary or other recovery (provided that nothing limits the Executive’s rights under Section 5 below). The Executive represents and warrants that: (i) there has not been filed by the Executive or on the Executive’s behalf any legal or other proceedings against any of the Released Parties (provided, however, that the Executive need not disclose to the Company, and the foregoing representation and warranty in this subpart do not apply to, conduct or matters described in Section 5 below); (ii) the Executive is the sole owner of the claims that are released in Section 1 above; (iii) none of these claims has been transferred or assigned or caused to be transferred or assigned to any other person, firm or other legal entity; and (iv) the Executive has the full right and power to grant, execute, and deliver the releases, undertakings, and agreements contained in this Release.
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4.
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Specific Rights Under OWBPA. The Executive understands and agrees that: (A) this is the full and final release of all claims against Aon through the date he signs this Release; (B) the Executive knowingly and voluntarily releases claims hereunder for valuable consideration; (C) the Executive hereby is and has been advised of his right to have his attorney review this Release before signing it; (D) the Executive has twenty-one (21) days to consider whether to sign this Release; and (E) the Executive may, at his sole option, revoke this Release upon written notice within seven (7) days after signing it. This Release will not become effective until this seven (7) day period has expired and will be void if he revokes it within such period. Although the Executive is releasing claims that he may have under the ADEA and the OWBPA, he understands that he may challenge the knowing and voluntary nature of this Release under the OWBPA and the ADEA before a court, the EEOC, the NLRB, or any other federal state or local agency charged with the enforcement of any employment laws.
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5.
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Protected Rights. Nothing in this Release is intended to limit in any way the Executive’s right or ability to report possible violations of law or regulation to, or file a charge or complaint with, the U.S. Securities and Exchange Commission, the U.S. Equal Employment Opportunity Commission, the National Labor Relations Board, or other federal, state or local agencies or commissions (collectively, “Government Agencies”). The Executive further understands that nothing in this Release limits the Executive’s ability to communicate with any Government Agencies or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to the Company. This Release does not limit the Executive’s ability to receive an award from a Government Agency for information provided by the Executive to such Government Agency.
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AON CORPORATION
By: Printed Name: Molly Johnson Its: Vice President & Secretary Date: _________ |
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Michael J. O’Connor Date: _________ |
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