AMENDMENT
TO
EMPLOYMENT AGREEMENT
AMENDMENT
(“Amendment”) made as of this 27th day of
January 2006 to the Amended and Restated Employment Agreement
dated as of December 5, 2003 (the “Employment
Agreement”) by and between Aetna Inc. (“Aetna”),
a Pennsylvania corporation and Ronald A. Williams
(“Executive”).
WHEREAS ,
Aetna and Executive have previously entered into the Employment
Agreement; and
WHEREAS ,
Aetna and Executive desire to amend the Employment
Agreement.
NOW,
THEREFORE , effective February 14, 2006, the Employment
Agreement is hereby amended as follows:
1. Sections 1.01(a)
and (b) of the Employment Agreement are amended in their
entirety to read as follows:
“(a) On
February 14, 2006 (the “Effective Date”),
Executive shall assume the position, duties and responsibilities as
the Company’s President and Chief Executive
Officer.
(b) In
such position, Executive shall have the duties and authority
commensurate with such position and such other duties and
authority, consistent with such position, as shall be assigned to
him from time to time by the Company’s Board of Directors
(the “Board”). Executive shall report only to the
Board.”
2. Section 1.02
of the Employment Agreement is amended in its entirety to read as
follows:
“SECTION
1.02. Term . Executive shall continue to be employed by the
Company for a period commencing on the Effective Date and, subject
to earlier termination or extension as provided herein, ending on
December 31, 2008 (the “Employment Term”). On
December 31, 2008 and on December 31st of each subsequent year
up to and including December 31, 2013, the Employment Term
shall automatically be extended for one additional year (but not
beyond Executive’s sixty-fifth (65th) birthday) unless not
later than 90 days prior to such date the Company or Executive
shall have given written notice of its or his intention not so to
extend the Employment Term. Unless earlier terminated, the
Employment Term shall end on Executive’s sixty-fifth (65th)
birthday.”
3. Section 2.01
of the Employment Agreement is amended in its entirety to read as
follows:
“SECTION
2.01. Base Salary . Starting on the Effective Date, the
Company shall pay Executive an annual base salary (the “Base
Salary”) at the initial annual rate of $1,100,000, payable in
equal monthly installments or otherwise in accordance with the
payroll and personnel practices of the Company from time to time.
The Base Salary shall be reviewed annually by the Compensation
Committee of the Board (the “Committee”) for possible
increase in the sole discretion of the Committee. Executive’s
Base Salary, as in effect from time to time, may not be reduced by
the Company without Executive’s consent, except in the event
of a ratable reduction affecting all senior officers of the
Company. Any amount of Base Salary in excess of $1,000,000 for a
fiscal year shall be mandatorily deferred on an annual basis and in
compliance with Code Section 409A (but nevertheless remain
eligible for benefits, if otherwise eligible) until the fiscal year
after the fiscal year in which Executive’s employment
terminates; provided, however, to the extent permissible under Code
Section 409A without causing any additional tax on Executive
under Code Section 409A, if the Company reasonably anticipates
that the Company’s tax deduction with respect to such payment
would be limited or eliminated by application of Code
Section 162(m), such payment shall be delayed to the earliest
date in which the Company anticipates that its tax deduction for
such payment will not be limited or eliminated. Any deferral of
Base Salary under this Section 2.01 shall earn a rate of return in
accordance with the Company’s deferral program applicable to
the Company’s senior executive officers in effect from time
to time.”
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