Aon said an internal review has found no misconduct in its stock option awards, but accounting mistakes were made that will cost the company more than $8 million in compensation to affected stockholder employees.
In a filing with the Securities and Exchange Commission Wednesday, the Chicago-based insurance broker said an audit committee's review found no misconduct by current or former management or directors in the award of stock options from 1994 to 2006.
However, there were incorrect measurement dates used for accounting and tax purposes for several thousand awards, the company said in its filing.
In part, to remedy errors on unexercised options granted to two chief executives, the price of those options will be increased.
Patrick G. Ryan, the company's founder, chairman and chief executive officer during the period, will see 550,000 share options awarded in 2000 and 2002 increased in price by $940,610. Michael D. O'Halleran, then president and chief operating officer, will see 120,000 shares awarded in 2002 increased in price by $285,000.
The company said both executives agreed to the increases to resolve the situation.
To remedy unfavorable tax consequences employees would be exposed to resulting from the inaccurate measurements, Aon estimates it will pay somewhere around $8.4 million.
The company said the payments would be made directly to the Internal Revenue Service or provided to individuals.
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