1
EXHIBIT 10.1
[AETNA LOGO] XXXX X. XXXX, MD
President and CEO
Direct Telephone: 000-000-0000
To Xxxx X. Xxxxx
Date March 21, 2001
Subject Separation Agreement
The purpose of this document (the "Agreement") is to confirm the financial and
other provisions regarding your resignation of employment from Aetna Inc. and
its affiliated and related entities (collectively, the "Company") pursuant to
the special severance arrangements outlined in the Company's letter to you dated
September 6, 2000. We agree as follows:
1. Your last day of employment will be April 6, 2001. You agree to execute
all documentation requested by the Company needed to implement this
Agreement, including resignations from all positions and directorships
you may hold with the Company, Company subsidiaries or affiliates.
2. From April 7, 2001 through April 4, 2004 (a period of 156 weeks), you
will be paid salary continuation at your current annual salary of
$750,000, payable bi-weekly. (This benefit is in lieu of benefits under
the Company's Severance and Salary Continuation Benefits Plan.)
3. On or about April 16, 2001, the Company will pay you the lump sum amount
of $2,250,000, less applicable withholding and taxes.
4. On or about April 16, 2001, you will be paid for any accrued but unused
days from your paid time off bank, subject to the maximum allowed by
Company policy (unless otherwise required by law).
5. Participation in all benefit programs will stop as of April 7, 2001,
except that during the salary continuation period you will continue to be
eligible for group medical and dental benefits on the same basis as
active employees.
6. Your exercise of stock options is governed by the plan and your stock
option agreements which provide for continued exercisability until 90
days after the termination of your salary continuation payments.
7. In consideration for the Company's agreement to provide the salary and
benefits continuation described above, you (for yourself and any other
person claiming or deriving a right from you) forever release and
discharge the Company (and its directors, employees, and agents) from any
and all liability, claims, and demands and causes of action (by whatever
name called and whether known or unknown) which you had, have, or may
have, arising out of:
2
Page 2
Xxxx X. Xxxxx
March 21, 2001
A. your employment with the Company;
B. the cessation of such employment; or
C. any act, omission, occurrence, or other matter related to such
employment or cessation of employment, up to and including the
date you sign this Agreement.
This release includes, but is not limited to, claims and liabilities
under the Americans with Disabilities Act, the Civil Rights Act of 1964,
the Civil Rights Act of 1991, the Age Discrimination in Employment Act,
the Employee Retirement Income Security Act of 1974 (ERISA), any other
claims under federal, state, or local law, and claims for attorney's
fees, costs, and the like. However, this release does not apply to vested
pension or 401(k) benefits.
Further, you promise that you will not institute any lawsuit against the
Company or its directors, employees or agents concerning any claim you
have released above. You agree that if you violate this promise, unless
prohibited by law, you will be liable for, and will pay, all costs and
expenses of defending against the suit, including reasonable attorney's
fees, incurred by the Company and those associated with the Company and
that you will immediately return all consideration received under this
Agreement to which you would not otherwise be entitled.
8. In further consideration for this Agreement, you promise that unless
required by law, you will not, for yourself or any other person or
entity, directly or indirectly, divulge, communicate or in any way make
use of any confidential, sensitive, or proprietary information acquired
in the performance of your service for the Company, without the prior
written consent of an appropriate Company officer. You represent that all
documents and property of the Company, including those containing
confidential, sensitive or proprietary information, have been or shortly
will be returned to the Company.
9. You agree that during the next 60 days, you will not make any
communication with any party regarding the Company or any aspect of the
business or affairs of the Company, other than as specifically permitted
in writing by the Company or as compelled by law, except for private
conversations with individuals who are not members of the media or stock
analyst community, on the condition that any such conversation are
limited to general comments consistent with paragraph 8 and would not
reasonably be expected to have a negative affect on the image,
reputation, prospects, value or business relationships of the Company.
The Company and you agree to cooperate on any press release to be issued
by the Company and any other communications concerning your resignation
from the Company.
10. You agree to provide assistance to and shall cooperate with the Company,
upon its reasonable request and without additional compensation, with
respect to matters within the scope of your duties and responsibilities
during employment. The Company agrees and acknowledges that it shall, to
the maximum extent possible under then prevailing circumstances,
coordinate (or cause an affiliate to coordinate) any such request with
your other commitments and responsibilities to minimize the degree to
which such request interferes with such commitments and responsibilities.
The Company agrees that it will
3
Page 3
Xxxx X. Xxxxx
March 21, 2001
reimburse you for reasonable travel expenses (ie., travel, meals, and
lodging) that you may incur in providing assistance to the Company
hereunder.
11. That certain Restrictive Covenant Agreement dated as of June 13, 1998
shall remain in effect and is incorporated by reference into this
Agreement, provided that Section 1 is inapplicable. The provisions of
your stock option award agreements and your restricted stock and stock
unit award agreements regarding non-solicitation of Company employees,
non-solicitation of customers, cooperation and non-disclosure of
confidential information shall remain in effect and are incorporated by
reference into this Agreement.
12. This Agreement shall not in any way be construed as an admission by the
Company or any of its agents that they have acted wrongfully with respect
to you or any other person.
13. The entire agreement between you and the Company is set out in this
Agreement or incorporated by reference into this Agreement. No other
promises or representations have been made, and there is no oral
understanding or agreement between you and the Company which is not
contained, or incorporated by reference, in this Agreement. The
provisions of the Company's letter to you dated September 6, 2000
regarding special severance arrangements is superceded by this Agreement,
except that the memorandum to you dated September 6, 2000 from Xxxxx X.
Xxxxx regarding the Company's excise tax policy in your favor shall
remain in full force and effect. The Company shall not be obligated to
make credits to the supplemental deferred benefits pension plan under
paragraph 8 of the Company's offer letter to you dated June 11, 1998 for
years three through six, inclusive.
14. This Agreement shall be construed in accordance with the laws of
Connecticut, and any actions brought under this Agreement shall be
exclusively brought in the courts of the State of Connecticut. Both
parties hereto irrevocably consent to the personal jurisdiction of the
courts of the State of Connecticut.
15. You acknowledge that you:
A. have been advised to consult an attorney before signing this
Agreement and that you have had an opportunity to consult with an
attorney of your choice;
B. have read this Agreement in its entirety, understand its terms and
knowingly and voluntarily consent to its terms and conditions; and
C. have had the opportunity to consider the Agreement for at least 21
days; to the extent that this Agreement differs in any way,
whether material or not, from any proposal previously
communicated, verbally or in writing, to you, you have had
sufficient time to consider this Agreement, and you waive any
right you may have to additional time to review it.
4
Page 4
Xxxx X. Xxxxx
March 21, 2001
This Agreement will become effective on the eighth day following the day you
execute it. After signing both copies of this Agreement, please return one copy
to me and retain a copy for your records. You may revoke this Agreement at any
time prior to its effective date by giving written notice to me.
Sincerely,
Aetna Inc.
By: /s/Xxxx X. Xxxx, M.D.
-------------------------------
Agreed to and Accepted:
/s/Xxxx X. Xxxxx 4/6/01
---------------------------------------- -------------------------------
Xxxx X. Xxxxx Date
