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Exhibit 10.5
CONSULTING AGREEMENT
This Consulting Agreement (this
"Agreement") is made as of the 1 st day of October, 2006, by and
between Aetna Inc. ("Company") and John W. Rowe, M.D.
("Consultant"). The parties hereto agree as follows:
1. Engagement .
Company hereby engages Consultant and Consultant hereby agrees to
render at the request of the Company’s Chief Executive
Officer or Board of Directors, upon reasonable notice, independent
consulting services for Company on matters of an executive and/or
high level nature, including but not limited to design and analysis
of Company’s experience with various products and strategies
including consumer-directed health plans, Aexcel networks, Chairman
initiatives, Medicare, pharmaceutical programs, wellness programs,
and other business matters as agreed by the parties. At the
Company’s request, Consultant will collaborate with the
Company on presentation and publication of the results of these
analyses for use by the Company, internally or externally. In
addition, at the Company’s request, Consultant shall serve as
a director of the Aetna Foundation, Inc. and continue to
participate in specific community activities, including
Board-related service, as requested by Company and agreed to by
Consultant. In this engagement and all activities hereunder,
Consultant shall serve as an independent contractor and not an
employee of Company, as further explained in Section 6
below.
2. Term . The term of
this Agreement shall begin as of October 1, 2006 and shall
terminate on September 30, 2009, unless terminated earlier or
extended pursuant to Section 5 of this Agreement.
3. Compensation . As
compensation for all services rendered by Consultant under this
Agreement, Company shall pay Consultant at a per diem rate of
$4,000 per day and at $2,000 per half-day for consulting services
excluding any community-related efforts or service as a board
director of a charitable or not-for-profit entity, subject to the
provisions of Section 5 of this Agreement. All such
compensation shall be payable without deduction, including no
deduction for federal income, social security, or state income
taxes. All applicable taxes shall be the responsibility of
Consultant. Company also shall pay all travel-related expenses of
Consultant for such consulting services including all
community-related efforts performed at Company’s and/or Aetna
Foundation Inc.’s request. In connection with any consulting
assignment hereunder, (i) Consultant shall have full access (on the
same basis then applicable to senior executives of the Company) to
the Company’s travel facilities (e.g., car, driver, aircraft
and helicopter services), (ii) Company shall provide an office
with appropriate support services for Consultant at Company’s
facilities in either New York or Boston (at Consultant’s
election), unless Consultant assumes another professional position
that provides office and support services, provided, however, that
if Company does not maintain facilities in the city in which
Consultant desires to work, it shall provide Consultant facilities
at another location in such city, and (iii) Company shall
provide Consultant with computers (including upgrades), software,
printers, monitors and access to information technology and
communications support staff (on the same basis as such items and
support are made available to senior executives of the Company) in
his office and at his two principal residences.
4. Performance of
Duties . Consultant shall render services conscientiously and
shall devote his best efforts and abilities thereto, at such times
during the term hereof, and in such manner, as Company and
Consultant shall mutually agree, not to exceed 25 full days per
calendar quarter, it being acknowledged that Consultant’s
services shall be performed at such places and at such times as are
reasonably convenient to Consultant, upon reasonable notice.
Consultant shall observe all policies and directives promulgated
from time to time by Company.
5. Termination . This
Agreement will terminate by either party upon reasonable notice to
the other. This Agreement also will terminate on Consultant’s
death or, upon Consultant’s acceptance of an academic or
government position, upon Consultant’s request. The term of
this Agreement may be extended for two additional one-year periods
on the same terms and conditions upon mutual agreement of
Consultant and Company. Consultant’s obligations under
Section 7 (Confidential Information), Section 8 (Return
of Confidential Information and Other Company Property),
Section 9 (Rights of Authorship), Section 10 (Remedy),
Section 11 (Arbitration) and Section 12 (Miscellaneous)
shall survive termination hereof.
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6. Independent
Contractor . It is expressly agreed that Consultant is acting
as an independent contractor in performing services hereunder.
Company shall carry no workers’ compensation insurance or any
health or accident insurance (other than standard Aetna retiree
medical care benefits to which the Consultant is otherwise
entitled) to cover Consultant. Company shall not pay any
contributions to Social Security, unemployment insurance, federal
or state withholding taxes, nor provide any other contributions or
benefits that might be expected in an employer-employee
relationship. Company shall, however, pay all expenses associated
with the arrangement contemplated herein, including but not limited
to advice, consulting, negotiation and preparation of documents
memorializing such arrangement.
7. Confidential
Information . Consultant desires to act as a consultant to
Company and he understands and agrees that his duties for the
Company in the past have required, and his consulting duties may
require, access to Confidential Information of a competitive
nature, which Company makes available only to select persons who
have a need to know such confidential information, and/or
information subject to the attorney-client and work product
privileges. Consultant understands and agrees tha
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