Employment Agreement with Michael Roth

First Amendment to the Employment Agreement

Second Amendment to the Employment Agreement

Third Amendment to the Employment Agreement

Fourth Amendment to Employment Agreement

Change in Control Agreement

Amendment to Change in Control Agreement

Executive Severance Plan

 

 

 

EMPLOYMENT AGREEMENT

 

 

          AGREEMENT made as of July 13, 2004 by and between THE INTERPUBLIC GROUP OF COMPANIES, INC., aDelaware corporation ("Interpublic") and MICHAEL ROTH ("Executive").

 

          In consideration of the mutual promises set forth herein the parties hereto agree as follows:

 

ARTICLE I

Term of Employment

 

          1.01     Subject to the provisions of Article VII and Article VIII, and upon the terms and subject to the conditions set forth herein, Interpublic will employ Executive beginning July 13, 2004 ("Commencement Date") and continuing thereafter, subject to termination in accordance with the provisions of Article VII hereof. (The period during which Executive is employed hereunder is referred to herein as the "term of employment.") Executive will serve Interpublic during the term of employment.

 

ARTICLE II

Duties

 

          2.01     During the term of employment, Executive will:

 

 

           (i)       Serve as Chairman of Interpublic;

 

 

 

           (ii)      Use his best efforts to promote the interests of Interpublic and devote his full time and efforts to their business and affairs;

 

 

 

           (iii)     Perform such duties as Interpublic may from time to time assign to him;

 

           (iv)     Serve in such other offices of Interpublic as he may be elected or appointed to.

 

ARTICLE III

Regular Compensation

 

          3.01     Interpublic will compensate Executive for the duties performed by him hereunder, by payment of a base salary at the rate of Nine Hundred Fifty Thousand Dollars ($950,000) per annum, payable in equal installments, which Interpublic shall pay at semi-monthly intervals, subject to customary withholding for federal, state and local taxes.

 

          3.02     Executive' s compensation will be subject to periodic reviews in accordance with Interpublic' s policies. Interpublic may at any time increase the compensation paid to Executive under this Article III if Interpublic in its sole discretion shall deem it advisable so to do in order to compensate him fairly for services rendered to Interpublic.

 

ARTICLE IV

Bonuses

 

          4.01     Executive will be eligible during the term of employment to participate in Interpublic' s Annual Management Incentive Plan, or any successor plan, in accordance with the terms and conditions of the Plan established from time to time. Executive shall be eligible for a target award equal to one hundred thirty-three percent (133%) of his base salary. The actual award, if any, may vary from zero percent (0%) to one hundred fifty percent (150%) of target, and shall be determined by Interpublic based on profits, Executive' s individual performance, and management discretion.

 

ARTICLE V

Interpublic Stock

 

          5.01     As soon as administratively feasible after full execution of this Agreement, Interpublic will grant to Executive such number of shares of Interpublic Common Stock as shall have an aggregate market value of One Million and Fifty Thousand Dollars ($1,050,000) on the date of grant. Such shares will be subject to a three-year vesting restriction from the date of grant.

 

          5.02     As soon as administratively feasible after full execution of this Agreement, Interpublic will grant to Executive options to purchase shares of Interpublic Common Stock as shall have an aggregate expected value of One Million and Fifty Thousand Dollars ($1,050,000) on the date of grant. Such options will vest in thirds on each of the second, third and fourth anniversaries of the date of grant.

 

          5.03     Beginning in 2005, and concurrent with grants to the executive team, Executive shall participate in the Company' s long-term incentive programs with a total expected annual award value at target of Two Million One Hundred Thousand Dollars ($2,100,000). Such award shall be provided in a manner consistent with those provided to the executive team and may comprise stock options, restricted stock, performance-based restricted stock or another form of incentive at the Compensation Committee' s discretion. Awards will be subject to performance and vesting terms and conditions consistent with those generally required of the executive team.

 

ARTICLE VI

Other Employment Benefits

 

          6.01     Executive shall be eligible to participate in such other employee benefits as are available from time to time to other key management executives of Interpublic in accordance with the then-current terms and conditions established by Interpublic for eligibility and employee contributions required for participation in such benefits opportunities.

 

          6.02     Employee will be entitled to annual paid time off, in accordance with Interpublic' s policies and procedures, to be taken in such amounts and at such times as shall be mutually convenient for Executive and Interpublic.

 

          6.03     Executive shall be reimbursed for all reasonable out-of-pocket expenses actually incurred by him in the conduct of the business of Interpublic provided that Executive submits all substantiation of such expenses to Interpublic on a timely basis in accordance with standard policies of Interpublic.

 

          6.04     Executive shall be entitled to an automobile allowance of Ten Thousand Dollars ($10,000) per annum, which shall cover all car-related expenses and parking.

 

          6.05     Executive shall be entitled to a club allowance of Twenty Thousand Dollars ($20,000) per annum, which shall cover all club-related expenses.

 

          6.06     Executive shall be eligible to participate in the Executive Medical Plus Plan, and shall receive an annual financial planning allowance of Two Thousand Five Hundred Dollars ($2,500).

 

          6.07     Executive shall participate in Interpublic' s Capital Accumulation Plan, with an annual contribution of One Hundred Thousand Dollars ($100,000).

 

ARTICLE VII

Termination

 

          7.01     Interpublic may terminate the employment of Executive hereunder:

 

 

 

           (i)       By giving Executive notice in writing at any time specifying a termination date not less than twelve (12) months after the date on which such notice is given, in which event Executive' s employment hereunder shall terminate on the date specified in such notice, or

 

 

 

           (ii)      By giving Executive notice in writing at any time specifying a termination date less than twelve (12) months after the date on which such notice is given. In this event Executive' s employment hereunder shall terminate on the date specified in such notice and Interpublic shall thereafter pay him a sum equal to the amount by which twelve (12) months salary at his then current rate exceeds the salary paid to him for the period from the date on which such notice is given to the termination date specified in such notice. Such payment shall be made during the period immediately following the termination date specified in such notice, in successive equal monthly installments each of which shall be equal to one (1) month' s salary at the rate in effect at the time of such termination, with any residue in respect of a period less than one (1) month to be paid together with the last installment.

 

 

 

           (iii)     During the termination period provided in subsection (i), or in the case of a termination under subsection (ii) providing for a termination period of less than twelve (12) months, for a period of twelve (12) months after the termination notice, Executive will be entitled to receive all employee benefits accorded to him prior to termination which are made available to employees generally; provided, that such benefits shall cease upon such date that Executive accepts employment with another employer offering similar benefits.

 

          7.02     Notwithstanding the provisions of Section 7.01, during the period of notice of termination, Executive will use reasonable, good faith efforts to obtain other employment reasonably comparable to his employment under this Agreement. Upon obtaining other employment (including work as a consultant, independent contractor or establishing his own business), Executive will promptly notify Interpublic, and (a) in the event that Executive' s salary and other non-contingent compensation ("new compensation") payable to Executive in connection with his new employment shall equal or exceed the salary portion of the amount payable by Interpublic under Section 7.01, Interpublic shall be relieved of any obligation to make payments under Section 7.01, or (b) in the event Executive' s new compensation shall be less than the salary portion of payments to be made under Section 7.01, Interpublic will pay Executive the difference between such payments and the new compensation. In the event Executive accepts employment with any company owned or controlled by Interpublic during the period in which payments are being made pursuant to Section 7.01 of this Agreement, all such payments shall cease upon commencement of such employment.

 

          7.03     Executive may at any time give notice in writing to Interpublic specifying a termination date not less than three (3) months after the date on which such notice is given, in which event his employment hereunder shall terminate on the date specified in such notice. Provided however, Interpublic may, at its option, upon receipt of such notice determine an earlier termination date. During the notice period, Executive will continue to be an employee, will assist Interpublic in the transition of his responsibilities and will be entitled to continue to receive base salary and to participate in all benefit plans for which an employee at Executive' s level is eligible, but not to receive any bonus award that might otherwise be paid during that period except as otherwise provided herein. Interpublic may require that Executive not come in to work during the notice period. In no event, however, may Executive perform services for any other employer during the notice period.

 

          7.04     Notwithstanding the provisions of Section 7.01, Interpublic may terminate the employment of Executive hereunder, at any time after the Commencement Date, for Cause. For purposes of this Agreement, "Cause" means the following:

 

 

 

           (i)       Any material breach by Executive of any provision of this Agreement (including without limitation Sections 8.01 and 8.02 hereof) upon notice of same by Interpublic which breach, if capable of being cured, has not been cured within fifteen (15) days after such notice (it being understood and agreed that a breach of Section 8.01 or 8.02 hereof, among others, shall be deemed not capable of being cured);

 

 

 

           (ii)      Executive' s absence from duty for a period of time exceeding fifteen (15) consecutive business days or twenty (20) out of any thirty (30) consecutive business days (other than on account of permitted vacation or as permitted for illness, disability or authorized leave in accordance with Interpublic' s policies and procedures) without the consent of the Interpublic Board of Directors;

 

 

 

           (iii)     The acceptance by Executive, prior to the effective date of Executive' s voluntary resignation from employment with Interpublic, of a position with another employer, without the consent of the Interpublic Board of Directors;

 

 

 

           (iv)     Misappropriation by Executive of funds or property of Interpublic or any attempt by Executive to secure any personal profit related to the business of Interpublic (other than as permitted by this Agreement) and not fairly disclosed to and approved by the Interpublic Board of Directors;

 

 

 

           (v)      Fraud, dishonesty, disloyalty, gross negligence, or willful misconduct on the part of Executive in the performance of his duties as an employee of Interpublic;

 

 

 

           (vi)     A felony conviction of Executive; or

 

 

 

           (vii)    Executive' s engaging, during the term of employment, in activities which are prohibited by federal, state, or local laws, or Interpublic or Interpublic' s policy, prohibiting discrimination or harassment based on age, sex, race, religion, disability, national origin or any other protected category.

 

          Upon a termination for Cause, Interpublic shall pay Executive his salary through the date of termination of employment, and Executive shall not be entitled to any bonus with respect to the year of termination, or to any other payments hereunder.

 

ARTICLE VIII

Covenants

 

          8.01     While Executive is employed hereunder by Interpublic he shall not, without the prior written consent of Interpublic, which will not be unreasonably withheld, engage, directly or indirectly, in any other trade, business or employment, or have any interest, direct or indirect, in any other business, firm or corporation; provided, however, that he may continue to own or may hereafter acquire any securities of any class of any publicly-owned company.

 

          8.02     Executive shall treat as confidential and keep secret the affairs of Interpublic and shall not at any time during the term of employment or thereafter, without the prior written consent of Interpublic, divulge, furnish or make known or accessible to, or use for the benefit of, anyone other than Interpublic and its subsidiaries and affiliates any information of a confidential nature relating in any way to the business of Interpublic or its subsidiaries or affiliates or their clients and obtained by him in the course of his employment hereunder.

 

          8.03     All records, papers and documents kept or made by Executive relating to the business of Interpublic or its subsidiaries or affiliates or their clients shall be and remain the property of Interpublic.

 

          8.04     All articles invented by Executive, processes discovered by him, trademarks, designs, advertising copy and art work, display and promotion materials and, in general, everything of value conceived or created by him pertaining to the business of Interpublic or any of its subsidiaries or affiliates during the term of employment, and any and all rights of every nature whatever thereto, shall immediately become the property of Interpublic, and Executive will assign, transfer and deliver all patents, copyrights, royalties, designs and copy, and any and all interests and rights whatever thereto and thereunder to Interpublic.

 

          8.05     During any period in which payments are being made to Executive pursuant to Section 7.01 above (the "Severance Period") and for a period of one (1) year following either the end of the Severance Period or the termination of Executive' s employment hereunder for any reason, whichever is later, Executive shall not:  (a) directly or indirectly solicit any employee of Interpublic to leave such employ to enter the employ of Executive or of any person, firm or corporation with which Executive is then associated, or induce or encourage any such employee to leave the employment of Interpublic or to join any other company, or hire any such employee, or otherwise interfere with the relationship between Interpublic and any of its employees or (b) directly or indirectly solicit or handle on Executive' s own behalf or on behalf of any other person, firm or corporation, the event marketing, public relations, advertising, sales promotion or market research business of any person or entity which is a client of Interpublic, or to induce any such client to cease to engage the services of Interpublic or to use the services of any entity or person that competes directly with a material business of Interpublic, where the identity of such client, or the client' s need, desire or receptiveness to services offered by Interpublic is known by Executive as a part of his employment with Interpublic. In addition, during the Severance Period, Executive shall not accept any form of employment (including as an advisor, consultant or otherwise) with an employer that is in competition with the business of the Interpublic. Executive acknowledges that these provisions are reasonable and necessary to protect Interpublic' s legitimate business interests, and that these provisions do not prevent Executive from earning a living.

 

          8.06     If at the time of enforcement of any provision of this Agreement, a court shall hold that the duration, scope or area restriction of any provision hereof is unreasonable under circumstances now or then existing, the parties hereto agree that the maximum duration, scope or area reasonable under the circumstances shall be substituted by the court for the stated duration, scope or area.

 

          8.07     Executive acknowledges that a remedy at law for any breach or attempted breach of Article VIII of this Agreement will be inadequate, and agrees that Interpublic shall be entitled to specific performance and injunctive and other equitable relief in the case of any such breach or attempted breach.

 

          8.08     Executive represents and warrants that neither the execution and delivery of this Employment Agreement nor the performance of Executive' s services hereunder will conflict with, or result in a breach of, any agreement to which Executive is a party or by which he may be bound or affected, in particular the terms of any employment agreement to which Executive may be a party. Executive further represents and warrants that he has full right, power and authority to enter into and carry out the provisions of this Employment Agreement.

 

ARTICLE IX

Arbitration

 

          9.01     Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, including claims involving alleged legally protected rights, such as claims for age discrimination in violation of the Age Discrimination in Employment Act of 1967, as amended, Title VII of the Civil Rights Act, as amended, and all other federal and state law claims for defamation, breach of contract, wrongful termination and any other claim arising because of Executive' s employment, termination of employment or otherwise, shall be settled by arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association and Section 12.01 hereof, and judgementupon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. The arbitration shall take place in the city where Executive customarily renders services to Interpublic. The prevailing party in any such arbitration shall be entitled to receive attorney' s fees and costs.

 

ARTICLE X

Assignment

 

          10.01     This Agreement shall be binding upon and enure to the benefit of the successors and assigns of Interpublic. Neither this Agreement nor any rights hereunder shall be assignable by Executive and any such purported assignment by him shall be void.

 

ARTICLE XI

Agreement Entire

 

          11.01     This Agreement constitutes the entire understanding between Interpublic and Executive concerning his employment by Interpublic or any of its parents, affiliates or subsidiaries and supersedes any and all previous agreements between Executive and Interpublic or any of its parents, affiliates or subsidiaries concerning such employment, and/or any compensation or bonuses. Each party hereto shall pay its own costs and expenses (including legal fees) incurred in connection with the preparation, negotiation and execution of this Agreement. This Agreement may not be changed orally.

 

ARTICLE XII
Applicable Law

 

          12.01     The Agreement shall be governed by and construed in accordance with the laws of the State of New York.

 

 

 

THE INTERPUBLIC GROUP OF

 

COMPANIES, INC.

 

 

 

By: /s/ Timothy Sompolski                              

 

      Timothy Sompolski

 

      Executive Vice President,

 

      Human Resources

 

 

 

 

 

              /s/ Michael Roth                               

 

                 Michael Roth

 

#Top of the Document

                                                                    Exhibt 10.2

 

 

                             SUPPLEMENTAL AGREEMENT

                             ----------------------

 

               SUPPLEMENTAL AGREEMENT made as of January 19, 2005 between THE

INTERPUBLIC GROUP OF COMPANIES, INC., a Delaware corporation ("Interpublic") and

Michael Roth ("Executive").

 

                              W I T N E S S E T H:

                              --------------------

 

               WHEREAS, Interpublic and Executive are parties to an Employment

Agreement made as of July 13, 2004 (hereinafter referred to as the "Agreement");

and

 

 

               WHEREAS, Interpublic and Executive desire to amend the Agreement;

 

               NOW, THEREFORE, in consideration of the mutual promises herein

and in the Agreement set forth, the parties hereto, intending to be legally

bound, agree as follows:

 

               1. Paragraph 2.01(i) of the Agreement is hereby amended,

effective as of January 19, 2005, by deleting "Chairman" therefrom and

substituting "Chairman and Chief Executive Officer" therefor.

 

               Except as hereinabove amended, the Agreement shall continue in

full force and effect.

 

               This Supplemental Agreement shall be governed by the laws of the

State of New York, applicable to contracts made and fully to be performed

therein.

 

                                         THE INTERPUBLIC GROUP OF

                                         COMPANIES, INC.

 

 

                                         By: /s/ Timothy Sompolski

                                             ---------------------------------

                                                 Timothy Sompolski

                                                 Executive Vice President,

                                                 Chief Human Resource Officer

 

 

                                             /s/ Michael Roth

                                             ---------------------------------

                                                 Michael Roth

 

#Top of the Document 

 

 

SUPPLEMENTAL AGREEMENT

 

SUPPLEMENTAL AGREEMENT made as of February 14, 2005 between THE INTERPUBLIC GROUP OF COMPANIES, INC., a Delaware corporation (“Interpublic”) and MICHAEL ROTH (“Executive”).

W I T N E S S E T H:

WHEREAS, Interpublic and Executive are parties to an Employment Agreement made as of July 13, 2004 as amended by Supplemental Agreement made as of January 19, 2005 (hereinafter referred to as the “Agreement”); and

WHEREAS, Interpublic and Executive desire to amend the Agreement;

NOW, THEREFORE, in consideration of the mutual promises herein and in the Agreement set forth, the parties hereto, intending to be legally bound, agree as follows:

1.          Section 3.01 of the Agreement is amended, effective as of January 19, 2005, by deleting “Nine Hundred Fifty Thousand Dollars ($950,000)” therefrom and substituting “One Million One Hundred Thousand Dollars ($1,100,000)” therefor.

2.

A new Section 5.04 shall be added to read in its entirety as follows:

Following full execution of this Supplemental Agreement, Interpublic will grant to Executive options to purchase four hundred fifth thousand (450,000) shares of Interpublic Common Stock. The options will be granted with an exercise price based on the market price of a share of Interpublic Stock on the date of grant and will become exercisable in three (3) equal installments on the second, third and fourth anniversaries of the date of grant.”

3.

A new Section 5.05 shall be added to read in its entirety as follows:

Following full execution of this Supplemental Agreement, Interpublic shall grant to Executive four hundred fifty thousand (450,000) shares of Interpublic restricted stock. The

 

 

 

 

 

 

 

 


 

shares of restricted stock granted pursuant to this Section 5.05 shall vest or be forfeited based upon the achievement of two and five year margin and revenue goals as indicated on the document attached hereto and summarized as follows: If goals are achieved, 150,000 shares will vest on the second anniversary of the date of grant and 300,000 shares will vest on the fifth anniversary of the date of grant. If such goals are not attained within the specified time periods, the same amount of shares will be forfeited in their entirety. It is understood that the Board of Directors retains discretion to make adjustments to goals in the event of extraordinary corporate events such as acquisitions or divestitures. In addition, in the event of a Change in Control of Interpublic (as defined in the Executive Severance Agreement, dated July 13, 2004 between Executive and Interpublic) restricted shares granted pursuant to this Section 5.05 will vest pro-rata based on the number of months elapsed between the date of grant and the date of the Change of Control, plus twelve (12) months.”

Except as hereinabove amended, the Agreement shall continue in full force and effect.

 

 

2

 

 

 

 


 

This Supplemental Agreement shall be governed by the laws of the State of New York, applicable to contracts made and fully to be performed therein.

THE INTERPUBLIC GROUP OF

COMPANIES, INC.

By  :  /s/ Timothy Sompolski                                                                                   

Timothy Sompolski

Executive Vice President

Chief Human Resources Officers

                      /s/ Michael Roth                                                               

 Michael Roth

 

 

 

3

 

 

 

 


 

Page 1 of 2

Michael I. Roth

Chairman and Chief Executive Officer

SUMMARY OF COMPENSATION ADJUSTMENTS


 

Base Salary

$150,000, or 16%, increase to $1,100,000 effective January 19, 2005. Salary reviewed annually by the Compensation Committee.


 

Annual Incentive

Annual target equal to 133% of base salary, or $1,463,000. This represents a $199,500 increase over the prior target. Actual awards may vary from 0% to 200% of this target, and will be determined by the Compensation Committee after assessing the CEO’s performance with input from all non-employee Directors.

 

Long-term Incentive

Annual long-term incentive participation with a total expected value of $3,000,000 delivered consistent with senior executive grants under IPG’s new program. This represents a $900,000 increase over the prior target. Grants are generally made in the March/April timeframe.

For 2005, this will compromise stock options, restricted shares, and performance-based restricted shares. Stock options will vest in thirds on the second, third and fourth anniversaries of their grant. Restricted shares will vest on the third anniversary of their grant.

Performance-based restricted shares will similarly vest on the third anniversary of their grant, at which point the number of shares earned will also be determined. A “target” number of shares (that is, the number earned for expected performance) will be communicated at the start of the performance period. At the end of the period, the final number of performance-based shares may vary from 0% to 200% of this target based on IPG’s three-year results relative to pre-set constant dollar revenue growth and operating margin objections.


 

One-time Stock Option Grant

One-time grant of 450,000 stock options with an approximate expected value at grant of $3,000,000. These options will have a 10-year term and will vest in thirds on the second, third and fourth anniversaries of their grant.

 

 

 

 

 

 

 

 

 

Page 2 of 2


 

 

One-time Performance-based Restricted Stock Grant

One-time grant of 450,000 performance-based restricted shares with an approximate value at time of grant of $6,120,000 and a risk-adjusted value at grant of $4,500,000. One-third (i.e., 150,000) of these shares will vest at the end of two years and the remaining two-thirds will vest at the end of five years, provided specific performance hurdles are achieved.

For the first 150,000 shares, vesting will be contingent on IPG achieving:

Cumulative constant dollar revenue reflecting average annual growth of 4.5% or better in 2005-6;

Growth in 2006 of at least 5%; and

Average operating margins for this two year period of 10.5% or higher.

For the remaining 300,000 shares, vesting will be contingent on IPG achieving:

Constant dollar revenue reflecting average annual growth of 6.3% over the three-year period from 2007 to 2009;

For the final year of the period (2009), constant dollar revenue reflecting at least 7.0% annual growth;

Average operating margins for this three-year period of 14.7% or higher;

Cumulative constant dollar revenue and operating income for the full five-year period must be $35.6 billion and $4.7 billion, respectively


 Top of the Document

 

 

Exhibit 10(iii)(A)(7)

AMENDMENT TO EMPLOYMENT AGREEMENT

          AMENDMENT made as of September 12, 2007 (the “Effective Date”), between THE INTERPUBLIC GROUP OF COMPANIES, INC. (“Interpublic”) and MICHAEL ROTH (“Executive”).

WITNESSETH:

          WHEREAS, Interpublic and Executive are parties to an Employment Agreement made as of July 13, 2004, as amended by Supplemental Agreements made as of January 19, 2005 and February 14, 2005 (collectively, the “Agreement”);

          WHEREAS, the Agreement provides for payments that are or might be treated as deferred compensation under Section 409A of the Internal Revenue Code of 1986, as amended from time to time (the “Code”); and

          WHEREAS, Interpublic and Executive wish to avoid causing the Agreement or any action taken thereunder to violate any applicable requirement of Section 409A of the Code;

          NOW, THEREFORE, in consideration of the mutual promises set forth herein and in the Agreement, the parties hereto, intending to be legally bound, agree as follows:

     1. Incorporation by Reference. All provisions of the Agreement are hereby incorporated herein by reference and shall remain in full force and effect except to the extent that (a) such provisions are expressly modified by the provisions of this Amendment, or (b) paragraph 12, below, requires such provisions to be modified.

     2. Defined Terms. When the initial letter or letters of any of the following words or phrases in this Amendment are capitalized, such word or phrase shall have the following meaning unless the context clearly indicates that a different meaning is intended:

     a. “ESP” means the Interpublic Executive Severance Plan, as amended from time to time.

     b. “401(k) Plan” means the Interpublic Savings Plan, as amended from time to time.

 

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

     c. “IPG” means Interpublic or any of its parents, subsidiaries, or affiliates.

     d. “Notice Date” means the date Interpublic provides written notice to Executive that his employment with Interpublic will be terminated involuntarily as of a specified Termination Date in the future.

     e. “Other Severance Payment” means any payment or taxable benefit, including any reimbursement of expenses (to the extent taxable), that Executive is entitled to receive under any other agreement, plan, program, policy, or other arrangement involving or maintained by IPG by reason of an “involuntary separation from service” (within the meaning of Treas. Reg. § 1.409A-1(n)) or participation in a program that constitutes a “window program” for purposes of Treas. Reg. § 1.409A-1(b)(9)(iii); providedhowever, that an Other Severance Payment shall not include:

     i. the portion (if any) of any payment or benefit that Executive would be entitled to receive upon any circumstance other than an “involuntary separation from service” or participation in a “window program;” or

     ii. any payment that is required to be made (and is made) on or before March 15th of the first calendar year that begins after the Termination Date. Interpublic shall determine whether a payment is required to be made on or before March 15th of the first calendar year that begins after the Termination Date based on the facts known as of the date Executive first acquired the right (including a contingent right) to become eligible to receive such payment.

     f. “Restricted Severance Payment” means:

     i. each payment prescribed by Section 7.01(ii) and (iii) of the Agreement, disregarding (A) any such payment that is required to be made (and is made) on or before March 15th of the first calendar year that begins after the Termination Date and (B) any benefit that is not includable in Executive’s income for federal income tax purposes; plus

     ii. each Other Severance Payment.

-2-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

Interpublic shall determine whether a payment is required to be made on or before March 15th of the first calendar year that begins after the Termination Date based on the facts known as of the date Executive first acquired the right (including a contingent right) to become eligible to receive such payment.

     g. “Severance Exclusion Amount” means two (2) times the lesser of:

     i. Executive’s annualized compensation based upon his annual rate of pay for services provided to IPG for Executive’s taxable year immediately preceding the taxable year in which the Termination Date occurs (adjusted for any increase during such taxable year preceding the Termination Date that was expected to continue indefinitely if Executive’s employment had not been terminated); or

     ii. the maximum amount that may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Code for the calendar year in which the Termination Date occurs.

     h. “Specified Employee” has the meaning prescribed by Section 409A(a)(2)(B)(i) of the Code, determined in accordance with Treas. Reg. § 1.409A-1(i).

     i. “Termination Date” means the date of Executive’s “separation from service” (within the meaning of Section 409A(a)(2)(A)(i) of the Code), as determined by Interpublic in accordance with Treas. Reg. § 1.409A-1(h)(1). A sale of assets to an unrelated buyer that results in Executive working for the buyer or one of its affiliates shall not, by itself, constitute a “separation from service” unless Interpublic, with the buyer’s written consent, so provides within sixty (60) or fewer days before the closing of such sale. Unless the context clearly indicates otherwise, the phrase “termination date” as it appears in the Agreement without capitalization shall have the same meaning as set forth in this subparagraph i.

          If the initial letter or letters of any word or phrase in this Amendment are capitalized, and such word or phrase is not defined in this Amendment, such word or phrase shall

-3-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

have the meaning set forth in the Agreement unless the context clearly indicates that a different meaning is intended.

     3. Allowances. Sections 6.04, 6.05 and 6.06 of the Agreement are hereby clarified as follows:

     a. Section 6.04 of the Agreement is clarified by adding the following sentence at the end thereof:

Such allowance shall be paid in equal installments according to Interpublic’s payroll practices and policies as are in effect from time to time.”

     b. Section 6.05 of the Agreement is clarified by adding the following sentence at the end thereof:

Such allowance for each year shall be paid on or before March 15th of the subsequent year.”

     c. Section 6.06 of the Agreement is clarified by adding the following sentence at the end thereof:

Such allowance for each year shall be paid on or before March 15th of the subsequent year.”

     4. Termination of Employment by Interpublic. The Preamble of Section 7.01 of the Agreement is hereby clarified by adding the following sentence to the beginning thereof:

The provisions of this Section 7.01 shall apply only if Interpublic terminates Executive’s employment hereunder involuntarily (within the meaning of Treas. Reg. § 1.409A-1(n)(1)) without Cause.”

     5. Time and Form of Payment of Severance Payments. Section 7.01(ii) of the Agreement is hereby amended by replacing the last sentence thereof with the following:

Except as required by Section 7.05 hereof, such amount shall be paid in successive semi-monthly installments, commencing on Interpublic’s first semi-monthly pay date that occurs after the Termination Date. The amount of each semi-monthly installment, before withholding, shall be equal to one-half of Executive’s base

-4-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

salary for one month at the rate in effect immediately prior to the Termination Date, with any residue in respect of a period of less than one-half of one month to be paid together with the last installment. For purposes of Section 409A of the Code, each installment required by this subsection (ii) shall be treated as a separate payment.”

     6. Continuation of Benefits. Section 7.01(iii) of the Agreement is hereby deleted and replaced in its entirety with the following:

(iii) Continuation of Benefits.

               “(a) If Interpublic terminates Executive’s employment involuntarily without Cause in accordance with subsection (i), above, Executive shall continue to be an employee, and shall continue to receive his base salary and the employee benefits that he is eligible to receive as an active employee, until the Termination Date (and Executive shall not receive salary or benefits for any period after the Termination Date).

               “(b) If Interpublic terminates Executive’s employment involuntarily without Cause in accordance with subsection (ii), above, Executive shall continue to receive the salary and benefits prescribed by paragraph (a), above, until the Termination Date. Thereafter, Executive shall be eligible to receive the following employee benefits:

               “(1) Medical, Dental, and Vision Benefits. Interpublic shall provide to Executive medical, dental, and vision benefits (or cash in lieu of such benefits) in accordance with Section 4.2 of ESP (including the indemnification required by Section 4.2(b) of ESP) as in effect on the Effective Date hereof, subject to the following provisions:

                    “(A) The “designated number of months” for purposes of determining the “severance period” under ESP shall be twelve (12); providedhowever, that Executive’s right to benefits under this subparagraph (1) shall terminate immediately upon Executive’s acceptance of employment with another employer offering similar benefits;

                    “(B) Any amendment, suspension, or termination of ESP after the Effective Date that has the effect of reducing the level of benefits required by this

-5-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

Section 7.01(iii)(b)(1) shall be disregarded unless Executive expressly consents in writing to such amendment, suspension, or termination; and

                    “(C) Executive’s right to the level of benefits required by this Section 7.01(iii)(b)(1) shall not be conditioned on Executive’s execution of the agreement required by Section 5 of ESP.

               “(2) Interpublic Savings Plan.

                    “(A) Executive shall not be eligible to contribute or defer (and shall not contribute or defer) any compensation with respect to the period after the Termination Date under the 401(k) Plan or any other savings or deferred compensation plan (whether tax-qualified or nonqualified) maintained by IPG.

                    “(B) Interpublic shall pay to Executive a lump-sum amount equal to the aggregate of the matching contributions that Interpublic would have made for the benefit of Executive under the 401(k) Plan if, during the period that begins on the day after the Termination Date and ends on the earlier of (x) the first anniversary of the Notice Date or (y) the date Executive accepts employment with another employer offering a tax-qualified savings plan, Executive had participated in the 401(k) Plan and made pre-tax deferrals and after-tax contributions to the 401(k) Plan at the same rate as in effect immediately before the Termination Date. Subject to Section 7.05 hereof, such payment shall be made (without interest) within thirty (30) days after the first anniversary of the Notice Date. The amount of the lump-sum payment required by this clause (B) shall be determined based on the matching formula prescribed by the 401(k) Plan as in effect during the period described herein.”

     7. Special Payment Rules. A new Section 7.05 shall be added to the Agreement, to provide in its entirety as follows:

          “7.05 Special Payment Rules.

                  “(i) ‘Specified Employee’ Rule. This Section 7.05(i) is intended to comply with the requirement under Section 409A(a)(2)(B)(i) of the Code to delay certain post-termination payments to Specified Employees for six (6) months after the

-6-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

Termination Date. In order to avoid an inadvertent violation of such requirement, the restrictions set forth in this Section 7.05(i) may be more restrictive than is required under Section 409A(a)(2)(B)(i) of the Code. However, this Section 7.05(i) shall not be construed to allow payment of any amount at any time that would cause a violation of Section 409A(a)(2)(B)(i) of the Code.

               “(a) If (x) Interpublic determines that Executive is a Specified Employee as of the Termination Date, and (y) the sum of Executive’s Restricted Severance Payments that are scheduled to be made before the first day of the seventh month following the Termination Date exceeds Executive’s Severance Exclusion Amount, then:

                “(1) each payment that Section 7.01(ii) hereof requires to be made on or before March 15th of the first calendar year that begins after the Termination Date shall be made at the time prescribed by Section 7.01(ii) hereof. Interpublic shall determine whether a payment is required to be made on or before March 15th of the first calendar year that begins after the Termination Date based on the facts known as of the date Executive first acquired the right (including a contingent right) to become eligible to receive such payment;

               “(2) each payment required by Section 7.01(ii) and (iii) hereof, other than the payments described by subparagraph (1), above, shall be made at the time prescribed by Section 7.01 hereof until the sum of (x) such payments, and (y) all Other Severance Payments equals Executive’s Severance Exclusion Amount; and

               “(3) to the extent that any payment required by Section 7.01(ii) or (iii) hereof, other than a payment described by subparagraph (1), above, cannot be made by reason of subparagraph (2), above, such payment shall be made on the later of:

                    “(A) Interpublic’s first semi-monthly pay date for the seventh month after the Termination Date (or, if earlier, a date determined by Interpublic that occurs within the ninety (90) day period immediately following the date of the Executive’s death); or

-7-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

                    “(B) the date on which such payment would otherwise be due in accordance with Sections 7.01(ii) or (iii) hereof.

               “(b) Interest shall not be added to any payment that is delayed by reason of the application of this Section 7.05(i).

     “(ii) Change of Control Rule. If Interpublic terminates Executive’s employment for any reason other than Cause within two years after a “Change of Control” (as defined in Executive’s Change of Control Agreement with the Company, dated                                         , as may be amended from time to time), any amount payable under Section 7.01(ii) shall be paid in a lump sum. Except as required by Section 7.05(i), such lump-sum payment shall be made within thirty (30) days after the Termination Date.”

     8. Reimbursement of Prevailing Party Fees and Costs. Section 9.01 of the Agreement is hereby amended by adding the following new sentences to the end thereof:

In order to be eligible for a payment or reimbursement pursuant to this Section 9.01, the party entitled to reimbursement or other payments shall submit to the other party a written request for payment, with invoices and receipts documenting the amount to be reimbursed or paid, within thirty (30) days after a final decision is rendered. Subject to the immediately preceding sentence, all reimbursements and other payments required by this Section 9.01 shall be made by March 15th of the calendar year next following the calendar year in which a final decision is rendered.”

     9. Entire Agreement. Article XI of the Agreement is hereby deleted and replaced by the following:

Article XI

Entire Agreement

     “11.01 This Agreement, as amended, sets forth the entire understanding between Interpublic and Executive concerning his employment by Interpublic and supersedes any and all previous agreements between Executive and Interpublic concerning such employment and/or any compensation or bonuses. In the event of any inconsistency between the terms of an amendment to this Agreement and the terms of this Agreement in effect before such amendment, the terms of the amendment shall govern. Each party hereto shall pay its own costs and expenses (including legal fees)

-8-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

incurred in connection with the preparation, negotiation, and execution of this Agreement and each amendment thereto. Any amendment or modification to this Agreement shall be set forth in writing and signed by Executive and an authorized director or officer of Interpublic.”

     10. Applicable Law. Section 12.01 of the Agreement is hereby clarified by adding at the end thereof the phrase “without regard to any rule or principle concerning conflicts or choice of law that might otherwise refer construction or enforcement to the substantive law of another jurisdiction.”

     11. Authority to Determine Payment Date. To the extent that any payment under the Agreement may be made within a specified number of days on or after any date or the occurrence of any event, the date of payment shall be determined by Interpublic in its sole discretion, and not by the Executive, his beneficiary, or any of his representatives.

     12. American Jobs Creation Act of 2004. The Agreement, as amended hereby, shall be construed, administered, and interpreted in accordance with (i) before January 1, 2008, a reasonable, good-faith interpretation of Section 409A of the Code and Section 885 of the American Jobs Creation Act of 2004 (collectively the “AJCA”) and (ii) after December 31, 2007, the AJCA. If Interpublic or Executive determines that any provision of the Agreement, as amended hereby, is or might be inconsistent with the requirements of the AJCA, the parties shall attempt in good faith to agree on such amendments to the Agreement as may be necessary or appropriate to avoid causing Executive to incur adverse tax consequences under Section 409A of the Code. No provision of the Agreement, as amended hereby, shall be interpreted or construed to transfer any liability for failure to comply with Section 409A from Executive or any other individual to Interpublic.

-9-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

          IN WITNESS WHEREOF, Interpublic, by its duly authorized officer, and Executive have caused this Amendment to the Agreement to be executed.

 

 

 

 

 

 

 

 

 

The Interpublic Group of Companies, Inc.

 

 

 

Executive

 

 

 

 

 

 

 

 

 

 

 

BY:

 

/s/ Timothy Sompolski

 

Timothy Sompolski

 

 

 

/s/ Michael Roth

 

Michael Roth

 

 

 

 

Executive Vice President

 

 

 

 

 

 

 

 

Chief Human Resources Officer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DATE:

 

September 12, 2007

 

 

 

DATE: September 12, 2007

 

 

-10-

 

 

 

 

 

 

 

#Top of the Document

EX-10.(III)(A)(1) 3 dex10iiia1.htm AMENDMENT, DATED MAY 1, 2008, TO AN EMPLOYMENT AGREEMENT

EXHIBIT 10(iii)(A)(1)

AMENDMENT TO EMPLOYMENT AGREEMENT

AMENDMENT effective as of January 1, 2007, between THE INTERPUBLIC GROUP OF COMPANIES, INC. (“Interpublic”) and MICHAEL ROTH (“Executive”).

WITNESSETH:

WHEREAS, Interpublic and Executive are parties to an Employment Agreement made as of July 13, 2004, as amended by Supplemental Agreements made as of January 19, 2005, February 14, 2005, and September 12, 2007 (collectively, the “Agreement”);

WHEREAS, as of January 1, 2007, Interpublic and Executive agreed that Executive’s car and club allowances would be discontinued and that Executive’s base salary would be increased by a corresponding amount as a result;

NOW, THEREFORE, in consideration of the mutual promises set forth herein and in the Agreement, the parties hereto, intending to be legally bound, hereby amend the Agreement effective January 1, 2007, as follows:

1. Incorporation by Reference. All provisions of the Agreement are hereby incorporated herein by reference and shall remain in full force and effect except to the extent that such provisions are expressly modified by the provisions of this Amendment.

2. Allowances. Sections 6.04 and 6.05 of the Agreement are hereby deleted in their entirety.

IN WITNESS WHEREOF, Interpublic, by its duly authorized officer, and Executive have caused this Amendment to the Agreement to be executed.

 

The Interpublic Group of Companies, Inc.     Executive BY:   /s/ Timothy Sompolski       /s/ Michael Roth  

Timothy Sompolski

Executive Vice President

Chief Human Resources Officer

      Michael Roth DATE:   5/1/08     DATE:   3/19/08

 

 

 

 

 

 

Exhibit 10(iii)(A)(8)

EXECUTIVE CHANGE OF CONTROL AGREEMENT

          This AGREEMENT (“Agreement”) dated as of September 12, 2007 (the “Effective Date”), by and between The Interpublic Group of Companies, Inc. (“Interpublic”), a Delaware corporation, and Michael Roth (the “Executive”).

W I T N E S S E T H:

          WHEREAS, the Company (as hereinafter defined) recognizes the valuable services that the Executive has rendered to the Company and desires to be assured that the Executive will continue to attend to the business and affairs of the Company without regard to a Change of Control (as hereinafter defined);

          WHEREAS, the Executive is willing to continue to serve the Company but desires a reasonable degree of protection in the event of a Change of Control; and

          WHEREAS, the Company is willing to provide such protection in exchange for the Executive’s agreement not to engage, during a specified period after his employment with the Company is terminated, in certain activities that could be detrimental to the Company;

          NOW, THEREFORE, in consideration of the Executive’s continued service to the Company, and the mutual agreements herein contained, Interpublic and the Executive hereby agree as follows:

ARTICLE 1

DEFINITIONS

          When the initial letter or letters of the following words and phrases are capitalized in this Agreement, such words and phrases shall have the following meanings unless the context clearly indicates that a different meaning is intended:

          Section 1.1. Base Amount means the amounts, if any, that, if this Agreement did not exist, would be payable to the Executive pursuant to the terms of an Other Arrangement

 

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

by reason of the Executive’s Qualifying Termination; provided, however, that the Base Amount shall not include any non-cash benefits or reimbursements or payments in lieu of such benefits.

          Section 1.2. Board of Directors means the Board of Directors of Interpublic.

          Section 1.3. Cause means —

               (a) a material breach by the Executive of a provision in an employment agreement with Interpublic or a Subsidiary that, if capable of being cured, has not been cured within fifteen (15) days after the Executive receives written notice from Interpublic or any Subsidiary of such breach;

               (b) misappropriation by the Executive of funds or property of Interpublic or a Subsidiary;

               (c) any attempt by the Executive to secure any personal profit related to the business of Interpublic or a Subsidiary that is not approved in writing by the Board of Directors or by the person to whom the Executive reports directly;

               (d) fraud, material dishonesty, gross negligence, gross malfeasance or insubordination by the Executive, or willful (i) failure by the Executive to follow the code of conduct of Interpublic or a Subsidiary or (ii) misconduct by the Executive in the performance of his duties as an employee of Interpublic or a Subsidiary, excluding in each case any act (or series of acts) taken in good faith by the Executive that does not (and in the aggregate do not) cause material harm to Interpublic or a Subsidiary;

               (e) refusal or failure by the Executive to attempt in good faith to perform the Executive’s duties as an employee or to follow a reasonable good-faith direction of the Board of Directors or the person to whom the Executive reports directly that has not been cured within fifteen (15) days after the Executive receives written notice from Interpublic of such refusal or failure;

               (f) commission by the Executive, or a formal charge or indictment alleging commission by the Executive, of a felony or a crime involving dishonesty, fraud, or moral turpitude; or

-2-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

               (g) conduct by the Executive that is clearly prohibited by the policy of Interpublic or a Subsidiary prohibiting discrimination or harassment based on age, gender, race, religion, disability, national origin or any other protected category.

          Section 1.4. Change of Control means —

               (a) subject to subsections (b) and (c), below, the first to occur of the following events:

               (i) any person (within the meaning of Sections 13(d) and 14(d) of the Securities Exchange Act of 1934 (the “1934 Act”)) becomes the beneficial owner (within the meaning of Rule 13d-3 under the 1934 Act) of stock that, together with other stock held by such person, possesses more than fifty percent (50%) of the combined voting power of Interpublic’s then-outstanding stock;

               (ii) any person (within the meaning of Sections 13(d) and 14(d) of the 1934 Act) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person) ownership of stock of Interpublic possessing thirty percent (30%) or more of the combined voting power of Interpublic’s then-outstanding stock;

               (iii) any person (within the meaning of Sections 13(d) and 14(d) of the 1934 Act) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person) assets from the Company that have a total gross fair market value equal to forty percent (40%) or more of the total gross fair market value of all of the assets of Interpublic immediately prior to such acquisition or acquisitions (where gross fair market value is determined without regard to any associated liabilities); or

               (iv) during any 12-month period, a majority of the members of the Board of Directors is replaced by directors whose appointment or election is not endorsed by a majority of the members of the Board of Directors before the date of their appointment or election.

-3-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

               (b) A Change of Control shall not be deemed to occur by reason of —

               (i) the acquisition of additional control of Interpublic by any person or persons acting as a group that is considered to “effectively control” Interpublic (within the meaning of Section 409A of the Code), or

               (ii) a transfer of assets to any entity controlled by the shareholders of Interpublic immediately after such transfer, including a transfer to (A) a shareholder of Interpublic (immediately before such transfer) in exchange for or with respect to its stock; (B) an entity, fifty percent (50%) or more of the total value or voting power of which is owned (immediately after such transfer) directly or indirectly by Interpublic; (C) a person or persons acting as a group that owns (immediately after such transfer) directly or indirectly fifty percent (50%) or more of the total value or voting power of all outstanding stock of Interpublic; or (D) an entity, at least fifty percent (50%) of the total value or voting power of which is owned (immediately after such transfer) directly or indirectly by a person described in clause (C), above.

               (c) Notwithstanding any provision in this Section 1.4 to the contrary, a Change of Control shall not be deemed to have occurred unless the relevant facts and circumstances give rise to a change in the ownership or effective control of Interpublic, or in the ownership of a substantial portion of the assets of Interpublic, within the meaning of Section 409A(a)(2)(A)(v) of the Code.

          Section 1.5. Code means the Internal Revenue Code of 1986, as amended.

          Section 1.6. Company means Interpublic and its Subsidiaries.

          Section 1.7. Designated Number means three (3). The Designated Number of Months means a number of calendar months equal to twelve (12) times the Designated Number.

          Section 1.8. Good Reason.

               (a) The Executive shall be deemed to resign for Good Reason if and only if (i) his Termination of Employment occurs within the two (2) year period immediately

-4-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

following the date on which a Covered Action (as defined by subsection (b), below) occurs and (ii) the conditions specified by subsections (b), (c), and (d) of this Section 1.8 are satisfied.

               (b) The Executive shall have Good Reason to resign from employment with the Company only if at least one of the following events (each a “Covered Action”) occurs within the two (2) year period immediately following the effective date of a Change of Control:

               (i) Interpublic or a Subsidiary materially reduces the Executive’s annualized rate of base salary;

               (ii) an action by Interpublic or a Subsidiary results in a material diminution of the Executive’s authority, duties or responsibilities;

               (iii) an action by Interpublic or a Subsidiary results in a material diminution in the authority, duties, or responsibilities of the supervisor to whom the Executive is required to report, including a requirement that the Executive report to a corporate officer or employee instead of reporting directly to the Board of Directors;

               (iv) Interpublic or a Subsidiary materially diminishes the budget over which the Executive retains authority;

               (v) Interpublic or a Subsidiary requires the Executive, without his express written consent, to be based in an office more than fifty (50) miles outside the city in which he is principally based, unless (A) the relocation decision is made by the Executive or (B) the Executive is notified in writing that Interpublic or his employer is seriously considering such a relocation and the Executive does not object in writing within ten (10) days after he receives such written notice; or

               (vi) Interpublic or a Subsidiary materially breaches an employment agreement between Interpublic or the Subsidiary and the Executive.

-5-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

               (c) The Executive shall not have Good Reason to resign as a result of a Covered Action unless —

               (i) within the ninety (90) day period immediately following the date on which such Covered Action first occurs, the Executive notifies Interpublic in writing that such Covered Action has occurred; and

               (ii) such Covered Action is not remedied within the thirty (30) day period immediately following the date on which Interpublic receives a notice provided in accordance with paragraph (i), above.

               (d) The Executive shall not have Good Reason to resign as a result of a Covered Action unless before the end of the thirty-one (31) day period immediately following the end of the thirty (30) day period specified by paragraph (c)(ii), above, the Executive gives Interpublic a minimum of thirty (30) days’, and a maximum of ninety (90) days’, advance written notice of the effective date of his resignation.

          Section 1.9. Other Arrangement means any other agreement, plan, program, policy, or other arrangement involving or maintained by Interpublic or a Subsidiary under which the Executive is or might be eligible to receive compensation or benefits.

          Section 1.10. Outside Auditor means either (i) the outside auditor retained by Interpublic in the last fiscal year ending before such Change of Control or (ii) a national auditing firm acceptable to the Executive.

          Section 1.11. Qualifying Termination means a Termination of Employment of the Executive that —

               (a) is initiated by (a) Interpublic or a Subsidiary for a reason other than Cause or (b) the Executive for Good Reason (as defined in this Agreement), and

               (b) occurs during the period that begins upon a Change of Control and ends at 11:59:59 p.m. Eastern Time on the second anniversary of such Change of Control.

-6-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

          Section 1.12. Severance Period means the period starting on the date of the Executive’s Qualifying Termination and ending on the last day of the calendar month that is the Designated Number of Months after such date.

          Section 1.13. Subsidiary means any corporation or other entity that is required to be combined with Interpublic as a single employer under Section 414(b) or (c) of the Code.

          Section 1.14. Termination of Employment means the Executive’s “separation from service” (within the meaning of Section 409A(a)(2)(A)(i) of the Code) with the Company. For purposes of this Agreement:

               (a) If the Executive is on a leave of absence and does not have a statutory or contractual right to reemployment, he shall be deemed to have had a Termination of Employment on the first date that is more than six (6) months after the commencement of such leave of absence. However, if the leave of absence is due to any medically determinable physical or mental impairment that can be expected to last for a continuous period of six (6) months or more, and such impairment causes the Executive to be unable to perform the duties of his position of employment or any substantially similar position of employment, the preceding sentence shall be deemed to refer to a twenty-nine (29) month period rather than to a six (6) month period; and

               (b) A sale of assets by Interpublic or a Subsidiary to an unrelated buyer that results in the Executive working for the buyer or one of its affiliates shall not, by itself, constitute a Termination of Employment unless Interpublic, with the buyer’s written consent, so provides in writing 60 or fewer days before the closing of such sale.

          Section 1.15. Unsecured Trust means a trust established pursuant to a trust agreement or other written instrument that (a) states that the assets of such trust are subject to claims of the Company’s creditors, (b) states that such trust shall be irrevocable until all claims for benefits under the plans, programs, agreements, and other arrangements covered by such trust have been satisfied, and (c) complies with the applicable provisions of Section 409A of the Code.

-7-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

ARTICLE 2

PAYMENTS UPON QUALIFYING TERMINATION

          Section 2.1. Severance Payment. Subject to the requirements of Section 3.2 hereof, if the Executive’s employment terminates as a result of a Qualifying Termination, Interpublic shall, within thirty (30) days after the date of the Executive’s Qualifying Termination (or such later date as required by Section 2.5 hereof), pay to the Executive a lump-sum amount (without any discount to reflect the time value of money) equal to the Designated Number multiplied by the sum of:

               (a) The greater of (i) the Executive’s annual base salary for the calendar year in which the Qualifying Termination occurs (determined on the basis of the Executive’s annual salary in effect immediately prior to such Qualifying Termination) or (ii) the Executive’s annual base salary for the calendar year in which the Change of Control occurs (determined on the basis of the Executive’s annual salary in effect immediately prior to such Change of Control); plus

               (b) The greater of (i) the Executive’s target management incentive compensation performance award under the 2006 Performance Incentive Plan or any successor thereto (“Target MICP Award”) for the calendar year in which the Qualifying Termination occurs or (ii) the Executive’s Target MICP Award for the calendar year in which the Change of Control occurs, as such Target MICP Award is in effect immediately prior to such Change of Control.

          Section 2.2. Medical, Dental, and Vision Benefits. If the Executive’s employment terminates as a result of a Qualifying Termination, Interpublic shall provide to the Executive medical, dental, and vision benefits (or cash in lieu of such benefits) in accordance with Section 4.2 of the Interpublic Executive Severance Plan (including the indemnification required by Section 4.2(b) of ESP) as in effect on the Effective Date (“ESP”), subject to the following provisions:

-8-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

               (a) The “designated number of months” for purposes of determining the Executive’s “severance period” and “COBRA period” under ESP shall be the Designated Number of Months set forth in Section 1.7 hereof;

               (b) Any amendment, suspension, or termination of ESP after the date of this Agreement that has the effect of reducing the level of benefits required by this Section 2.2, shall be disregarded unless the Executive expressly consents in writing to such amendment, suspension, or termination; and

               (c) The Executive’s right to the level of benefits required by this Section 2.2 shall not be conditioned on the Executive executing the agreement required by Section 5 of ESP.

          Section 2.3. CAP Supplement.

               (a) If the Executive participates in the Interpublic Capital Accumulation Plan (“CAP”), Interpublic shall, within thirty (30) days after the date of the Executive’s Qualifying Termination (or such later date as required by Section 2.5 hereof), pay to the Executive a lump-sum amount (without any discount to reflect the time value of money) equal to the sum of (i) plus (ii) plus (iii), where:

               (i) equals the sum of the annual dollar credits that would have been added to the Executive’s account under CAP on each December 31st after the Executive’s Termination of Employment if he had remained employed by the Company continuously through the last day of the Severance Period (provided that this paragraph (i) shall not require duplication of any amount that is added to the Executive’s account under CAP in accordance with the terms thereof);

               (ii) equals (A) the dollar credit that would have been added to the Executive’s account under CAP on December 31st of the calendar year in which the Severance Period ends if the Executive had remained employed by the Company continuously through such December 31st, multiplied by (B) a fraction the numerator of which is the number of days from January 1st of such calendar year through the last day

-9-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

of the Severance Period and the denominator of which is three hundred sixty-five (365); and

                (iii) equals (A) the interest crediting rate under CAP for the calendar year in which the Executive’s account balance under CAP is paid, multiplied by (B) the vested balance of the Executive’s account under CAP as of January 1st of such year, multiplied by (C) a fraction the numerator of which is the number of days from January 1st of such year through the date on which the Executive’s account balance under CAP is paid and the denominator of which is three hundred sixty-five (365).

               (b) Before a Change of Control, Interpublic shall contribute to an Unsecured Trust an amount that an Outside Auditor engaged by Interpublic, at Interpublic’s expense, concludes, in its best judgment (considering the information available to such Outside Auditor at the time of the calculation and the time constraints on completing the calculation), is equal to the amount the Executive would be entitled to receive under this Section 2.3 if the Executive had a Qualifying Termination immediately after the Change of Control. For purposes of this calculation, the Outside Auditor shall assume that (i) payment of the amount described in the immediately preceding sentence will be due within thirty (30) days after the Change of Control and (ii) the rate of return on assets of the Unsecured Trust will be the interest crediting rate under CAP for the calendar year in which the Change of Control occurs.

                Section 2.4. SERIP Supplement.

               (a) If the Executive participates in the Interpublic Senior Executive Retirement Income Plan (“SERIP”), Interpublic shall, within thirty (30) days after the date of the Executive’s Qualifying Termination (or such later date as required by Section 2.5 hereof), pay to the Executive a lump-sum amount (without any discount to reflect the time value of money) equal to the excess of (i) over (ii), where:

               (i) equals the amount (if anything) the Executive would be entitled to receive under SERIP if he had remained employed by the Company continuously through the end of the Severance Period; and

-10-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

               (ii) equals the amount of the vested benefit (if any) that the Executive is eligible to receive under the terms of SERIP.

               (b) Before a Change of Control, Interpublic shall contribute to an Unsecured Trust an amount that an Outside Auditor engaged by Interpublic, at Interpublic’s expense, concludes, in its best judgment (considering the information available to such Outside Auditor at the time of the calculation and the time constraints on completing the calculation), is equal to the amount the Executive would be entitled to receive under this Section 2.4 if the Executive had a Qualifying Termination immediately after the Change of Control. For purposes of this calculation, the Outside Auditor shall assume that (i) payment of the amount described in the immediately preceding sentence will be due within thirty (30) days after the Change of Control and (ii) the rate of return on assets of the Unsecured Trust will be the plan interest rate specified by SERIP.

          Section 2.5. Special Payment Rules.

               (a) Specified Employee Rules. If Interpublic determines that the Executive is a “specified employee” (within the meaning of Section 409A(a)(2)(B)(i) of the Code, and determined in accordance with Treas. Reg. § 1.409A-1(i)) on the date of his Termination of Employment, Interpublic shall make the payments specified by paragraphs (i), (ii), and (iii) of this Section 2.5(a) and shall not make any payments pursuant to Section 2.1, Section 2.3, or Section 2.4 hereof (except insofar as such Sections determine the amount required by this Section 2.5(a)).

               (i) Interpublic shall pay the Base Amount at the time or times prescribed by the terms of the applicable Other Arrangement through the last day of the sixth calendar month that begins after the date of the Executive’s Termination of Employment;

               (ii) Within thirty (30) days after the date of the Executive’s Qualifying Termination, Interpublic shall pay to the Executive in a lump sum the excess (if any) of (A) the sum of the amounts prescribed by Section 2.1, Section 2.3, and Section 2.4 hereof over (B) the aggregate Base Amount payable under all Other Arrangements.

-11-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

The amounts in clauses (A) and (B) of this paragraph (ii) shall be determined without any adjustment (such as a discount) to reflect the time value of money; and

               (iii) On the 6-Month Pay Date (as defined below), Interpublic shall pay to the Executive an amount equal to the excess (if any) of (A) the sum of the aggregate amounts prescribed by Section 2.1 (taking into account Section 4.5), Section 2.3, and Section 2.4 hereof over (B) the aggregate amount paid in accordance with paragraphs (i) and (ii), above (determined without any adjustment (such as interest) to reflect the time value of money). The “6-Month Pay Date” shall be Interpublic’s first semi-monthly pay date for the seventh calendar month that begins after the date of the Executive’s Termination of Employment (or, if earlier, a date that occurs within the ninety (90) day period immediately following the date of the Executive’s death; provided that such date shall be determined by Interpublic in its sole discretion and not by the Executive or his personal representative).

               (b) 2007 Transition Rule.

               (i) If, under the terms of any Other Arrangement in effect on the Effective Date (disregarding this Agreement), payment of the Executive’s Base Amount was scheduled to begin before January 1, 2008, payment of the Executive’s Base Amount shall begin at the time prescribed by the terms of such Other Arrangement.

               (ii) If paragraph (i), above, does not apply:

               (A) Payment of the Participant’s Base Amount shall not begin before January 1, 2008; and

               (B) If this Agreement prescribes that payment of the Base Amount should begin before January 1, 2008, payment of such Base Amount shall begin on Interpublic’s first semi-monthly pay date for January 2008. The first payment due in January 2008 shall include a make-up payment equal to the sum of the payments that, if not for the delay required by the preceding sentence, would have been made before Interpublic’s first semi-monthly pay date for January 2008.

-12-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

Interest shall not be added to any payment that is delayed by reason of the application of this Section 2.5.

          Section 2.6. Death Prior to Payment. If the Executive dies after his Qualifying Termination but before all of the payments required by this Article 2 have been made, Interpublic shall pay to the Executive’s estate an amount equal to the sum of the then-unpaid amounts required by this Article 2. Such payment shall be made in a lump sum (without any discount to reflect the time value of money) as soon as practicable, and no more than ninety (90) days, after the Executive’s death. The date of payment shall be determined by Interpublic in its sole discretion, and not by the Executive or his personal representative

ARTICLE 3

TAX MATTERS

          Section 3.1. Withholding and Taxes. The Company may withhold (or cause to be withheld) from any amounts payable to the Executive or on his behalf hereunder any or all federal, state, city, or other taxes that the Company reasonably determines are required to be withheld pursuant to any applicable law or regulation. However, except for the indemnification referred to in Section 2.2 hereof, the Executive shall be solely responsible for paying all taxes (including any excise taxes) on any compensation (including imputed compensation) and other income provided to him or on his behalf, regardless of whether taxes are withheld. Except for the indemnification referred to in Section 2.2 hereof, no provision of this Agreement shall be construed (a) to limit the Executive’s responsibility under this Section 3.1 or (b) to transfer to or impose on the Company any liability relating to taxes (including excise taxes) on compensation (including imputed compensation) or other income under this Agreement.

          Section 3.2. Forfeiture of Certain Parachute Payments.

               (a) Notwithstanding any provision in this Agreement to the contrary, if subsection (b), below, applies, the Executive shall forfeit amounts payable to the Executive under this Agreement to the extent an Outside Auditor determines is necessary to ensure that the Executive is not reasonably likely to receive a “parachute payment” within the meaning of Section 280G(b)(2) of the Code.

-13-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

               (b) This subsection (b) shall apply if —

               (i) any payment to be made under this Agreement is reasonably likely to result in the Executive receiving a “parachute payment” (as defined in Section 280G(b)(2) of the Code), and

               (ii) the Executive’s forfeiture of payments due under this Agreement would result in the aggregate after-tax amount that the Executive would receive being greater than the aggregate after-tax amount that the Executive would receive if there were no such forfeiture.

               (c) Interpublic shall engage, at Interpublic’s expense, an Outside Auditor to determine (i) whether any amount shall be forfeited pursuant to subsection (a), above, and (ii) the amount of any such forfeiture. The Outside Auditor’s determination shall be conclusive and binding.

               (d) If the Outside Auditor engaged pursuant to subsection (c), above, determines that adverse tax consequences relating to Section 280G of the Code (determined on a net after-tax basis) could be avoided by the Executive forfeiting payments under one or more Other Arrangements, and such Other Arrangements permit a forfeiture to avoid adverse tax consequences relating to Section 280G of the Code, the Executive shall not forfeit the right to receive any amount due under this Agreement unless and until he has forfeited the right to all payments under such Other Arrangements.

ARTICLE 4

COLLATERAL MATTERS

          Section 4.1. Nature of Payments. All payments and benefits provided to the Executive under this Agreement shall be considered either severance payments in consideration of his past services on behalf of the Company or payments in consideration of the covenant set forth in Section 4.7 hereof. No payment or benefit provided hereunder shall be regarded as a penalty on the Company.

-14-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

          Section 4.2. Mitigation. The Executive shall not be required to mitigate the amount of any payment or benefit provided for in this Agreement by seeking other employment or otherwise. Except as expressly provided in Section 4.2(b) of ESP (with respect to benefits provided pursuant to Section 2.2(c)) hereof, unless the Executive breaches the covenant set forth in Section 4.7 hereof, the amount of any payment provided for herein shall not be reduced by any remuneration that the Executive may earn after his Termination of Employment.

          Section 4.3. Setoff for Debts. To the extent permitted under Section 409A of the Code, Interpublic may reduce the amount of any payment or benefit otherwise due to the Executive under Article 2 hereof by any amount that the Executive owes to the Company pursuant to a written instrument executed by the Executive, but only if (a) the debt was incurred in the ordinary course of the Executive’s relationship with the Company, (b) the entire amount of reduction in any taxable year does not exceed $5,000, (c) the reduction is made at the same time and in the same amount as required by the terms of such written instrument, and (d) the Company has not already recovered such amount by setoff or otherwise.

          Section 4.4. Plans, Programs, and Arrangements Not Addressed in this Agreement. Except as otherwise provided by Section 4.5 hereof, the effect of a Change of Control or a Qualifying Termination on the rights of the Executive with respect to any compensation, awards, or benefits under any Other Arrangement (including rights under any deferred compensation arrangement, the Interpublic Capital Accumulation Plan, the Interpublic Senior Executive Retirement Income Plan, any Executive Special Benefit Agreement, and the 2006 Performance Incentive Plan and any predecessor or successor thereto) shall be determined solely by the terms of the governing documents for such Other Arrangement, and not by the terms of this Agreement.

          Section 4.5. Coordination with Employment Contract. The payments and benefits required by Article 2 hereof shall be in lieu of (and not in addition to) any payments under an Other Arrangement to which the Executive might have a claim by reason of a Qualifying Termination (for example, severance payments), whether such Other Arrangement is executed before or after the date hereof, unless expressly provided otherwise in such Other Arrangement; provided that if Other Arrangements provide for a payment (or payments) by

-15-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

reason of a Qualifying Termination that is (or are) larger in the aggregate (determined without regard to the time value of money) than the severance payment prescribed by Section 2.1 hereof, the Company shall pay the Executive the larger amount (in lieu of the amount prescribed by Section 2.1, and without any adjustment for interest) in a lump sum (without any discount to reflect the time value of money) at the time prescribed by Section 2.1 (or such later date as required by Section 2.5 hereof). If the Executive resigns for Good Reason, he shall be deemed to have satisfied any notice requirement for resignation, and any service requirement following such notice, under any employment contract between the Executive and Interpublic or a Subsidiary.

          Section 4.6. Funding. Except as required by Section 2.3(b), Section 2.4(b), and Section 4.8(c) hereof, this Agreement does not require the Company to set aside any amounts that may be necessary to satisfy its obligations hereunder. Any assets that the Company sets aside to fund the Company’s obligations under this Agreement, whether in an Unsecured Trust or otherwise, shall be subject to the claims of the Company’s creditors in the event of the Company’s bankruptcy or insolvency.

          Section 4.7. Covenant of Executive.

               (a) If the Executive has a Qualifying Termination that entitles him to a payment under Article 2 hereof, the Executive shall not, during the eighteen (18) months next following the date of his Termination of Employment, either (i) solicit any employee of the Company to leave such employ and to enter into the employ of, or to provide services to, the Executive or any person with which the Executive is associated or (ii) solicit or handle on his own behalf, or on behalf of any person with which the Executive is associated, the advertising, public relations, sales promotion or market research business of any person that is a client of the Company as of the date of the Executive’s Termination of Employment.

               (b) The Executive acknowledges that the provisions of this Section 4.7 are a material inducement to Interpublic entering into this Agreement, that such provisions are reasonable and necessary to protect the legitimate business interests of the Company, and that such provisions do not prevent the Executive from earning a living. If at the time of enforcement of any provision of this Agreement, a court with jurisdiction shall hold that the duration, scope,

-16-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

or restrictiveness of any provision hereof is unreasonable under circumstances now or then existing, the parties agree that the maximum duration, scope, or restriction reasonable under the circumstances shall be substituted by the court for the stated duration, scope, or restriction.

               (c) The Executive acknowledges that a remedy at law for any breach or attempted breach of this Section 4.7 will be inadequate, and agrees that the Company shall be entitled to specific performance and injunctive and other equitable relief in the case of any such breach or attempted breach. This Section 4.7 shall not limit any other right or remedy that the Company may have under applicable law or any other agreement between the Company and the Executive.

          Section 4.8. Legal Expenses.

               (a) Each party hereto shall pay its own costs and expenses (including legal fees) incurred in connection with the preparation, negotiation and execution of this Agreement.

               (b) Interpublic shall reimburse the Executive for any legal fees and expenses that the Executive incurs during the Executive’s life as a result of the Company contesting the validity, the enforceability, or the Executive’s interpretation of, or any determination under, this Agreement (collectively “Reimbursable Expenses”), subject to the following terms and conditions:

               (i) The Executive shall submit any request for reimbursement for any Reimbursable Expense in writing to Interpublic (accompanied by any evidence that Interpublic reasonably requests in writing within thirty (30) days after Interpublic is first notified that such Reimbursable Expense is incurred) within one-hundred eighty (180) days after the applicable Reimbursable Expense is incurred (or, if later, within thirty (30) days after Interpublic requests in writing evidence of such Reimbursable Expense);

               (ii) Interpublic shall pay to the Executive the amount of any Reimbursable Expenses within thirty (30) days after Interpublic receives the Executive’s written request for reimbursement; provided that if Interpublic determines that the

-17-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

Executive is a “specified employee” (within the meaning of Section 409A(a)(2)(B)(i) of the Code, and determined in accordance with Treas. Reg. § 1.409A-1(i)) at the time of his Termination of Employment, payment shall not be made before the first day of the seventh month that begins after the Executive’s Termination of Employment, and if this paragraph (ii) prescribes an earlier payment date, payment shall be made, without interest, on Interpublic’s first semi-monthly pay date for the seventh month that begins after the Executive’s Termination of Employment;

               (iii) The amount of fees and expenses eligible for reimbursement during one year shall not affect the amount of Reimbursable Expenses that the Executive may incur during any other year; and

               (iv) The Executive may not exchange the right to reimbursement for Reimbursable Expenses set forth in this Section 4.8(b) for cash or any other benefit.

               (c) Without limiting the foregoing, Interpublic shall, before the earlier of (i) thirty (30) days after receiving notice from the Executive to Interpublic so requesting or (ii) the occurrence of a Change of Control, provide the Executive with an irrevocable letter of credit in the amount of $100,000 from a bank with a Moody’s credit rating of Aa or better and a Standard & Poor’s credit rating of AA or better, against which the Executive may draw in the event that Interpublic does not timely remit payment for any Reimbursable Expense. Such letter of credit shall not expire before the later of (x) the date this Agreement terminates by its terms or (y) the tenth anniversary of the Effective Date.

-18-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

ARTICLE 5

GENERAL PROVISIONS

          Section 5.1. Term of Agreement.

               (a) Subject to subsection (b), below, this Agreement shall terminate upon the earliest of —

               (i) the third anniversary of the Effective Date if a Change of Control has not occurred on or before such third anniversary;

               (ii) the date of the Executive’s Termination of Employment if such Termination of Employment is not a Qualifying Termination; or

               (iii) the expiration of a number of years after a Change of Control equal to the Designated Number plus three (3).

               (b) Notwithstanding any provision of this Section 5.1, the Company’s obligations under Section 4.8 hereof and all obligations of the Company and the Executive that arise before termination of this Agreement shall survive the termination of this Agreement. In addition, if this Agreement is terminated and the Executive subsequently experiences a Qualifying Termination, Interpublic shall pay any severance to which the Executive may be entitled under any Other Arrangement (such as an employment agreement or the Interpublic Executive Severance Plan) in a lump sum at the time required by Section 2.1 hereof (subject to Section 2.5 hereof).

          Section 5.2. Payments to be Made in Cash. Except as otherwise expressly provided herein, all payments required by this Agreement shall be made in cash.

          Section 5.3. Obligation to Make Payments. Interpublic may satisfy any provision of this Agreement that obligates Interpublic to make a payment or contribution, or to provide a benefit, by causing another party, such as a Subsidiary or the trustee of an Unsecured Trust, to make the payment or contribution or to provide the benefit.

-19-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

          Section 5.4. Governing Law. Except as otherwise expressly provided herein, this Agreement and the rights and obligations hereunder shall be construed and enforced in accordance with the laws of the State of New York, without regard to any rule or principle concerning conflicts or choice of law that might otherwise refer construction or enforcement to the substantive law of another jurisdiction.

          Section 5.5. American Jobs Creation Act of 2004. This Agreement shall be construed, administered, and interpreted in accordance with (a) before January 1, 2008, a reasonable, good-faith interpretation of Section 409A of the Code and Section 885 of the American Jobs Creation Act of 2004 and all guidance of general applicability issued thereunder (collectively the “AJCA”) and (b) after December 31, 2007, the AJCA. If the Company or the Executive determines that any provision of this Agreement is or might be inconsistent with such provisions, the parties shall attempt in good faith to agree on such amendments to this Agreement as may be necessary or appropriate to avoid adverse tax consequences under Section 409A of the Code. No provision of this Agreement shall be interpreted or construed to transfer any liability for a failure to comply with Section 409A of the Code from the Executive or any other individual to the Company.

          Section 5.6. Successors to the Company. This Agreement shall inure to the benefit of Interpublic and its subsidiaries and shall be binding upon and enforceable by Interpublic and any successor thereto, including any person or persons (within the meaning of Sections 13(d) and 14 (d) of the 1934 Act) acquiring directly or indirectly the business or assets of Interpublic whether by merger, consolidation, sale or otherwise, but shall not otherwise be assignable by Interpublic. Without limiting the foregoing sentence, Interpublic shall require any successor (whether direct or indirect, by merger, consolidation, sale of stock or assets, or otherwise) to the business or assets of Interpublic, expressly, absolutely and unconditionally to assume, and to agree to perform under, this Agreement in the same manner and to the same extent as Interpublic would have been required to perform it if no such succession had taken place. As used in this Agreement, “Interpublic” shall mean Interpublic as heretofore defined and any successor to its business or assets that becomes bound by this Agreement either pursuant to this Agreement or by operation of law.

-20-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

          Section 5.7. Successor to the Executive. This Agreement shall inure to the benefit of and shall be binding upon and enforceable by the Executive and his personal and legal representatives, executors, administrators, heirs, distributees, legatees and, subject to Section 5.8 hereof, his designees (collectively, his “Successors”). If the Executive dies while amounts are or may be payable to him under this Agreement, references hereunder to the “Executive” shall, where appropriate, be deemed to refer to his Successors.

          Section 5.8. Nonalienability. Except to the extent that Interpublic determines is necessary to comply with a domestic relations order (as defined in Section 414(p)(1)(B) of the Code), no right of or amount payable to the Executive under this Agreement shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, hypothecation, encumbrance, charge, execution, attachment, levy or similar process, or (except as provided in Section 4.3 hereof) to setoff against any obligation or to assignment by operation of law. Any attempt, voluntary or involuntary, to effect any action prohibited by the immediately preceding sentence shall be void.

          Section 5.9. Notices. All notices provided for in this Agreement shall be in writing. Notices and other correspondence (including any request for reimbursement) to Interpublic shall be deemed given when personally delivered or sent by certified or registered mail or overnight delivery service to The Interpublic Group of Companies, Inc., l114 Avenue of the Americas, New York, New York l0036, Attention: Corporate Secretary. Notices to the Executive shall be deemed given when personally delivered or sent by certified or registered mail or overnight delivery service to the last address for the Executive shown on the records of the Company. Either Interpublic or the Executive may, by notice to the other, designate an address other than the foregoing for the receipt of subsequent notices.

          Section 5.10. Amendment. No amendment of this Agreement shall be effective unless it is in writing and is executed by both Interpublic and the Executive.

          Section 5.11. Waivers. No waiver of any provision of this Agreement shall be valid unless it is in writing and executed by the party giving such waiver. No waiver of a breach of any provision of this Agreement shall be deemed to be a waiver of any subsequent breach or a waiver of either such provision or any other provision of this Agreement. No failure or delay on

-21-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

the part of either the Company or the Executive to exercise any right or remedy conferred by law or this Agreement shall operate as a waiver of such right or remedy, and no exercise or waiver, in whole or in part, of any right or remedy conferred by law or herein shall operate as a waiver of any other right or remedy.

          Section 5.12. Non-Duplication and Changes to Benefit Plans.

               (a) No term or other provision of this Agreement shall be interpreted to require the Company to duplicate any payment or other compensation that the Executive is entitled to receive under an Other Arrangement.

               (b) No term or other provision of this Agreement shall restrict the Company’s ability to amend, suspend, or terminate any or all of its employee benefit plans and programs from time to time, or prevent any such amendment, suspension, or termination from affecting the Executive.

          Section 5.13. Severability. If any provision of this Agreement shall be held invalid or unenforceable in whole or in part, such invalidity or unenforceability shall not affect any other provision of this Agreement or part thereof, each of which shall remain in full force and effect.

          Section 5.14. Construction.

               (a) The captions to the respective articles and sections of this Agreement are intended for convenience of reference only and have no substantive significance.

               (b) Unless the contrary is clearly indicated by the context, (i) the use of the masculine gender shall also include within its meaning the feminine and vice versa; (ii) the word “include” shall mean include, but not limited to; and (iii) any reference to a statute or section of a statute shall also be a reference to any successor or amended statute or section, and any regulations or other guidance of general applicability issued thereunder.

          Section 5.15. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original but all of which together shall constitute a single instrument.

-22-

size=2 width="100%" noshade style='color:#ACA899' align=center>

 

          Section 5.16. Entire Agreement. This Agreement constitutes the entire understanding between the Company and the Executive concerning the matters set forth herein and supersedes any and all previous agreements between the Company and the Executive concerning such matters.

* * * * *

                    IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

 

 

 

 

 

 

 

THE INTERPUBLIC GROUP OF COMPANIES, INC.

 

 

 

 

 

 

 

 

 

By:  

/s/ Timothy Sompolski  

 

 

 

 

Timothy Sompolski 

 

 

 

 

Executive Vice President
Chief Human Resource Officer 

 

 

 

 

 

 

/s/ Michael Roth

 

Michael Roth

 

 

-23-

 

 

 

EX-10.1 2 exhibit101.htm EXHIBIT 10.1

EXHIBIT 10.1

 

Extension of Existing Executive Change of Control Agreement

 

WHEREAS, Michael Roth (the “Executive”) and The Interpublic Group of Companies, Inc. (“Interpublic,” Interpublic and its subsidiaries being referred to herein as the “Company”) are parties to an Executive Change of Control Agreement dated as of May 27, 2010 (the “Agreement”); and

WHEREAS, Section 5.1 of the Agreement states that the Agreement will expire as of September 1, 2013; and

WHEREAS, the Executive and the Company wish to extend the Agreement for another three years;

NOW, THEREFORE, the Agreement is hereby amended, effective immediately, as follows:

1.

Incorporation by Reference. All provisions of the Agreement are hereby incorporated herein by reference and shall remain in full force and effect except to the extent that such provisions are expressly modified by the provisions of this Extension. Words and phrases used in this Extension shall have the meaning set forth in the Agreement unless the context clearly indicates that a different meaning is intended.

 

2.

Extension. Section 5.1(a)(i) of the Agreement is amended by replacing the phrase “September 1, 2013” with “September 1, 2016”.

*    *    *

IN WITNESS WHEREOF, Interpublic, by its duly authorized officer, and Executive have caused this Extension to the Agreement to be executed.

The Interpublic Group of Companies, Inc.

           Executive

 

BY:      /s/ ANDREW BONZANI                  

              Andrew Bonzani

              SVP, General Counsel & Secretary

 

                /s/ MICHAEL ROTH                   

            Michael Roth

           

DATE: August 29, 2013

 

 

 

 

 

 

 

 

Top of the Document

EX-10.III.A.1 2 y37936exv10wiiiwaw1.htm EX-10.III.A.1: INTERPUBLIC EXECUTIVE SEVERANCE PLAN

 

Exhibit 10(iii)(A)(1)

 

 
INTERPUBLIC EXECUTIVE SEVERANCE PLAN

 

Effective June 1, 2007
 

 

 

<hr size=2 width="100%" noshade color=gray align=center>

 

TABLE OF CONTENTS

 

 

 

 

 

 

 

Article 1.

 

Introduction

 

 

1

 

 

 

 

 

 

 

 

          1.1.

 

Establishment and Purpose

 

 

1

 

          1.2.

 

Effective Date

 

 

1

 

 

 

 

 

 

 

 

Article 2.

 

Definitions and Construction

 

 

1

 

 

 

 

 

 

 

 

          2.1.

 

Definitions

 

 

1

 

          2.2.

 

Rules of Construction

 

 

8

 

 

 

 

 

 

 

 

Article 3.

 

Participation

 

 

8

 

 

 

 

 

 

 

 

          3.1.

 

Commencing Participation

 

 

8

 

          3.2.

 

Ending Participation

 

 

9

 

 

 

 

 

 

 

 

Article 4.

 

Severance Benefits

 

 

9

 

 

 

 

 

 

 

 

          4.1.

 

Salary Continuation Benefit

 

 

9

 

          4.2.

 

Medical, Dental, and Vision Benefits

 

 

10

 

          4.3.

 

Delay of Payment to Specified Employees

 

 

13

 

          4.4.

 

Non-duplication, Coordination, and Right to Change Benefit Plans

 

 

14

 

          4.5.

 

Forfeiture of Certain Parachute Payments

 

 

15

 

 

 

 

 

 

 

 

Article 5.

 

Release and Covenants

 

 

16

 

 

 

 

 

 

 

 

          5.1.

 

Benefits Contingent on Executing Agreement

 

 

16

 

          5.2.

 

Time Limit for Executing Agreement

 

 

17

 

 

 

 

 

 

 

 

Article 6.

 

Nature of Participant’s Interest in and Rights Under the Plan

 

 

18

 

 

 

 

 

 

 

 

          6.1.

 

No Right to Assets

 

 

18

 

          6.2.

 

No Right to Transfer Interest

 

 

18

 

          6.3.

 

No Employment Rights

 

 

18

 

          6.4.

 

Withholding and Tax Liabilities

 

 

18

 

 

 

 

 

 

 

 

Article 7.

 

Administration, Interpretation, and Modification of Plan

 

 

19

 

 

 

 

 

 

 

 

          7.1.

 

Plan Administrator

 

 

19

 

          7.2.

 

Powers of the Administrator and Review of Determinations

 

 

19

 

          7.3.

 

American Jobs Creation Act of 2004 (“AJCA”)

 

 

19

 

          7.4.

 

Amendment, Suspension, and Termination

 

 

20

 

 

 

 

 

 

 

 

Article 8.

 

Claims and Appeals

 

 

21

 

 

 

 

 

 

 

 

          8.1.

 

Application of Claims and Appeals Procedures

 

 

21

 

          8.2.

 

Initial Claims

 

 

21

 

          8.3.

 

Appeals

 

 

22

 

          8.4.

 

Other Rules and Rights Regarding Claims and Appeals

 

 

23

 

          8.5.

 

Interpretation

 

 

23

 

 

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

 

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Article 9.

 

Miscellaneous Provisions

 

 

23

 

 

 

 

 

 

 

 

          9.1.

 

Payments to be Made in Cash

 

 

23

 

          9.2.

 

Obligation to Make Payments

 

 

23

 

          9.3.

 

Authority to Determine Payment Date

 

 

24

 

          9.4.

 

Successors to the Company

 

 

24

 

          9.5.

 

Mitigation Not Required

 

 

24

 

          9.6.

 

Incapacity

 

 

24

 

          9.7.

 

Power to Delegate Authority

 

 

24

 

          9.8.

 

Overpayments

 

 

24

 

          9.9.

 

Headings

 

 

24

 

          9.10.

 

Severability

 

 

25

 

          9.11.

 

Governing Law

 

 

25

 

          9.12.

 

Complete Statement of Plan

 

 

25

 

 

 

 

 

 

 

 

Exhibit A: Model Release and Covenant Agreement

 

 

26

 

 

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-ii-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 


Article 1. Introduction

 

1.1.

 

Establishment and Purpose.

 

 

 

 

 

This Executive Severance Plan (the “Plan”) is established to provide severance and other welfare benefits for eligible executives of Interpublic and its Subsidiaries in the event that their employment is terminated either (a) by Interpublic or a Subsidiary for a reason other than Cause or (b) by the executive for Good Reason. The Plan is an unfunded welfare plan maintained primarily for the purpose of providing severance and other welfare benefits to a select group of management and highly compensated employees.

 

 

 

1.2.

 

Effective Date.

 

 

 

 

 

The Plan is effective as of June 1, 2007.

 


Article 2. Definitions and Construction

 

2.1.

 

Definitions.

 

 

 

 

 

When their initial letter(s) are capitalized, the following words and phrases have the following meanings unless the context clearly indicates that a different meaning is intended:

 

(a)

 

Administrative Committee” means Interpublic’s Management Human Resources Committee.

 

 

 

 

 

(b)

 

Applicable Premium Rate” means, for any Participant:

 

 

(1)

 

For each month during the Participant’s Severance Period, the premium rate or rates that Interpublic’s medical, dental, and vision plan or plans charge for coverage during such month to an active employee who holds the position that the Participant held (or, if none, the employee who holds the position most nearly comparable to the position that the Participant held) immediately before his Termination Date for the level of coverage under such plan or plans that the Participant elects to receive pursuant to Section 4.2; and

 

 

 

 

 

(2)

 

For each month during the Participant’s COBRA Period, the premium rate or rates that Interpublic’s medical, dental, and vision plan or plans charge for COBRA continuation coverage during such month at the level that the Participant elects to receive pursuant to Section 4.2.

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

 

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

(c)

 

Base Salary” for any Participant, expressed as an annual amount, means the Participant’s annual base salary in effect for the calendar year in which his Termination Date occurs; provided that if the Participant’s Notice Date or Termination Date occurs within 24 months after a Change of Control, his Base Salary for purposes of the Plan shall not be less than his annual base salary for the calendar year in which such Change of Control occurred, determined on the basis of the Participant’s annual salary in effect immediately prior to such Change of Control.

 

 

 

 

 

(d)

 

Board of Directors” means the Board of Directors of Interpublic.

 

 

 

 

 

(e)

 

Cause” means, with respect to any Participant:

 

(1)

 

A material breach by the Participant of a provision in an employment agreement with Interpublic or a Subsidiary that, if capable of being cured, has not been cured within 15 days after the Participant receives written notice from his Employer of such breach;

 

 

 

 

 

(2)

 

Misappropriation by the Participant of funds or property of Interpublic or a Subsidiary;

 

 

 

 

 

(3)

 

Any attempt by the Participant to secure any personal profit related to the business of Interpublic or a Subsidiary that is not approved in writing by the Board of Directors or by the person to whom the Participant reports directly;

 

 

 

 

 

(4)

 

Fraud, material dishonesty, gross negligence, gross malfeasance, or insubordination by the Executive, or willful (A) failure by the Participant to follow the code of conduct of Interpublic or a Subsidiary or (B) misconduct by the Participant in the performance of his duties as an employee of Interpublic or a Subsidiary, excluding in each case any act (or series of acts) taken in good faith by the Participant that does not (and in the aggregate do not) cause material harm to Interpublic or a Subsidiary;

 

 

 

 

 

(5)

 

Refusal or failure by the Executive to attempt in good faith to perform the Participant’s duties as an employee or to follow a reasonable good-faith direction of the Board of Directors or the person to whom the Participant reports directly that has not been cured within 15 days after the Participant receives written notice from his Employer of such refusal or failure;

 

 

 

 

 

(6)

 

Commission by the Participant, or a formal charge or indictment alleging commission by the Participant, of a felony or a crime involving dishonesty, fraud, or moral turpitude; or

 

 

 

 

 

(7)

 

Conduct by the Participant that is clearly prohibited by the policy of Interpublic or a Subsidiary prohibiting discrimination or harassment based on age, gender, race, religion, disability, national origin or any other protected category.

 

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-2-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

(f)

 

Change of Control” means:

 

(1)

 

Subject to paragraphs (2) and (3), below, the first to occur of the following events:

 

 

(A)

 

Any person (within the meaning of sections 13(d) and 14(d) of the Securities Exchange Act of 1934 (the “1934 Act”)) becomes the beneficial owner (within the meaning of Rule 13d-3 under the 1934 Act) of stock that, together with other stock held by such person, possesses more than 50 percent of the combined voting power of Interpublic’s then-outstanding stock;

 

 

 

 

 

(B)

 

Any person (within the meaning of sections 13(d) and 14(d) of the 1934 Act) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person) ownership of stock of Interpublic possessing 30 percent or more of the combined voting power of Interpublic’s then-outstanding stock;

 

 

 

 

 

(C)

 

Any person (within the meaning of sections 13(d) and 14(d) of the 1934 Act) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person) assets from Interpublic that have a total gross fair market value equal to 40 percent or more of the total gross fair market value of all of the assets of Interpublic immediately prior to such acquisition or acquisitions (where gross fair market value is determined without regard to any associated liabilities); or

 

 

 

 

 

(D)

 

During any 12-month period, a majority of the members of the Board of Directors is replaced by directors whose appointment or election is not endorsed by a majority of the members of the Board of Directors before the date of their appointment or election.

 

(2)

 

A Change of Control shall not be deemed to occur by reason of:

 

 

(A)

 

The acquisition of additional control of Interpublic by any person or persons acting as a group that is considered to “effectively control” Interpublic (within the meaning of guidance issued under section 409A of the Code) or

 

 

 

 

 

(B)

 

A transfer of assets to any entity controlled by the shareholders of Interpublic immediately after such transfer, including a transfer to (i) a shareholder of Interpublic (immediately before such transfer) in exchange for or with respect to its stock, (ii) an entity, 50 percent or more of the total value or voting power of which is owned (immediately after such transfer) directly or indirectly by Interpublic, (iii) a person or persons acting as a group that owns (immediately after such transfer) directly or indirectly 50 percent or more of the total value or voting power of all outstanding stock of Interpublic, or (iv) an entity, at least 50 percent of the total value or voting power of which is owned (immediately after such transfer) directly or indirectly by a person described in clause (iii), above.

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-3-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

(3)

 

Notwithstanding any provision in this Section 2.1(f) to the contrary, a Change of Control shall not be deemed to have occurred unless the relevant facts and circumstances give rise to a change in the ownership or effective control of Interpublic, or in the ownership of a substantial portion of the assets of Interpublic, within the meaning of section 409A(a)(2)(A)(v) of the Code.

 

(g)

 

COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

 

 

 

 

 

(h)

 

COBRA Period” means, for any Participant, the period starting on the day next following the last day of the Participant’s Severance Period and ending on the last day of the Participant’s “maximum required period” of continuation coverage under COBRA. For purposes of this Section 2.1(h), the Participant’s “maximum required period” shall be determined in accordance with Section 602 of ERISA and as if the Participant’s “qualifying event” (as defined in Section 603 of ERISA) occurred on the last day of his Severance Period.

 

 

 

 

 

(i)

 

Code” means the Internal Revenue Code of 1986, as amended.

 

 

 

 

 

(j)

 

Commencement Date” means, for any Participant, Interpublic’s first semi-monthly pay date that occurs after the Participant’s Termination Date.

 

 

 

 

 

(k)

 

Designated Number” means, for any Participant, the number of months specified below that corresponds with the level that Interpublic assigns to the Participant and communicates to the Participant in writing:

 

 

(1)

 

If the Participant is the Chief Executive Officer of Interpublic, his Designated Number shall be 24 months.

 

 

 

 

 

(2)

 

If the Participant is assigned to Interpublic’s “Tier A,” his Designated Number shall be 18 months.

 

 

 

 

 

(3)

 

If the Participant is assigned to Interpublic’s “Tier B, C, or D,” his Designated Number shall be 12 months.

 

 

 

 

 

(4)

 

If the Participant is assigned to Interpublic’s “Tier E,” his Designated Number shall be 6 months.

 

(l)

 

Dismissed” means, with respect to any Participant, that:

 

 

(1)

 

The Participant voluntarily terminates his employment with Interpublic and its Subsidiaries for Good Reason; or

 

 

 

 

 

(2)

 

The Participant’s employment with Interpublic and its Subsidiaries is terminated involuntarily (within the meaning of Treas. Reg. § 1.409A-1(n)(1)) for any reason other than for Cause.

 

(m)

 

Effective Date” means June 1, 2007.

 

 

 

 

 

(n)

 

Eligible Executive” means an employee of Interpublic or a Subsidiary who is designated in writing by the Administrative Committee as a member of the select

 

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-4-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

 

 

group of management or highly paid employees of Interpublic and its Subsidiaries who are eligible to participate in the Plan.

 

(o)

 

Employer” means, with respect to a Participant, Interpublic or the Subsidiary of Interpublic that employs the Participant immediately before the Participant’s Termination Date.

 

 

 

 

 

(p)

 

ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

 

 

 

 

 

(q)

 

Good Reason.”

 

 

(1)

 

A Participant shall be deemed to resign for Good Reason if and only if (A) his Termination Date occurs within the two-year period immediately following the date on which a Covered Action (as defined by paragraph (2), below) occurs and (B) the conditions specified by paragraphs (2) and (3) of this Section 2.1(q) are satisfied.

 

 

 

 

 

(2)

 

A Participant shall have Good Reason to resign from employment with Interpublic and its Subsidiaries only if at least one of the following events (each a “Covered Action”) occurs:

 

(A)

 

Interpublic or a Subsidiary materially reduces the Participant’s Base Salary;

 

 

 

 

 

(B)

 

An action by Interpublic or a Subsidiary results in a material diminution in the Participant’s authority, duties, or responsibilities;

 

 

 

 

 

(C)

 

An action by Interpublic or a Subsidiary results in a material diminution in the authority, duties, or responsibilities of the supervisor to whom the Participant is required to report, including a requirement that the Participant report to a corporate officer or employee instead of reporting directly to the Board of Directors;

 

 

 

 

 

(D)

 

Interpublic or a Subsidiary materially diminishes the budget over which the Participant retains authority;

 

 

 

 

 

(E)

 

The Participant’s principal place of work is moved to a location more than 50 miles outside the city in which he is principally based, unless (i) the relocation decision is made by the Participant or (ii) the Participant is notified in writing that Interpublic or his Employer is seriously considering such a relocation and the Participant does not object in writing within 10 days after he receives such written notice; or

 

 

 

 

 

(F)

 

Interpublic or a Subsidiary materially breaches any employment agreement between the Participant and his Employer.

 

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-5-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

(3)

 

A Participant shall not have Good Reason to resign as a result of a Covered Action unless:

 

(A)

 

Within the 90-day period immediately following the date on which such Covered Action first occurs, the Participant notifies his Employer in writing that such Covered Action has occurred; and

 

 

 

 

 

(B)

 

Such Covered Action is not remedied within the 30-day period immediately following the date on which the Executive’s Employer receives a notice provided in accordance with subparagraph (A), above.

 

 

(r)

 

Interpublic” means The Interpublic Group of Companies, Inc., and any successor thereto.

 

 

 

 

 

(s)

 

Notice Date” means, for any Participant, the date Interpublic or a Subsidiary provides written notice to the Participant that his employment with Interpublic and its Subsidiaries will be terminated involuntarily as of a specified Termination Date in the future.

 

 

 

 

 

(t)

 

Other Arrangement” means (1) any employment agreement with Interpublic or a Subsidiary or (2) any plan, program, policy or other arrangement maintained by Interpublic or a Subsidiary.

 

 

 

 

 

(u)

 

Participant” means an Eligible Executive who has become a participant in the Plan under Article 3.

 

 

 

 

 

(v)

 

Plan” means the Interpublic Executive Severance Plan, as set forth herein and subsequently amended from time to time.

 

 

 

 

 

(w)

 

Restricted Severance Payment” means:

 

(1)

 

Each of the payments prescribed by Sections 4.1 and 4.2(a)(2), disregarding any payment that is required to be made (and is made) on or before March 15th of the first calendar year that begins after the Participant’s Termination Date, plus

 

 

 

 

 

(2)

 

Any Separation Payments payable to the Participant under any Other Arrangement.

 

 

 

 

Interpublic shall determine whether a payment is required to be made on or before March 15th of the first calendar year that begins after the Participant’s Termination Date based on the facts known as of the date the Participant first became eligible to participate in the Plan.

 

(x)

 

Salary Continuation Benefit” means the benefit prescribed by Section 4.1.

 

 

 

 

 

(y)

 

Section” means a section of this Plan as in effect from time to time.

 

 

 

 

 

(z)

 

Separation Payment” means, for any Participant, any payment or taxable benefit, including any reimbursement of expenses (to the extent taxable), that the Participant is entitled to receive by reason of an “involuntary separation from

 

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-6-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

 

 

service” (within the meaning of Treas. Reg. § 1.409A-1(n)) or participation in a program that constitutes a “window program” for purposes of Treas. Reg. § 1.409A-1(b)(9)(iii); provided, however, that the term “Separation Payment” shall not include:

 

(1)

 

The portion (if any) of any payment or benefit that the Participant would be entitled to receive upon any circumstance other than an “involuntary separation from service” or participation in a “window program”, or

 

 

 

 

 

(2)

 

Any payment or benefit that is required to be made or provided (and is made or provided) on or before March 15th day of the first calendar year that begins after the Termination Date. Interpublic shall determine whether a payment or benefit is required to be made or provided on or before March 15th of the first calendar year that begins after the Participant’s Termination Date based on the facts known as of the date the Participant first acquired the right (including a contingent right) to become eligible to receive such payment or benefit.

 

 

(aa)

 

Severance Exclusion Amount” means, for any Participant, two times the lesser of :

 

(1)

 

The Participant’s annualized compensation based upon his annual rate of pay for services provided to Interpublic and its Subsidiaries for the Participant’s taxable year immediately preceding the taxable year in which his Termination Date occurs (adjusted for any increase during such taxable year preceding his “separation from service” that was expected to continue indefinitely if the Participant had not terminated employment), or

 

 

 

 

 

(2)

 

The maximum amount that may be taken into account under a qualified plan pursuant to section 401(a)(17) of the Code for the calendar year in which the Participant’s Termination Date occurs.

 

 

(bb)

 

Severance Period” means, for any Participant, the period starting on the Participant’s Notice Date (if Interpublic or a Subsidiary provides written notice to the Participant that his employment will be terminated involuntarily) or the Participant’s Termination Date (if he resigns for Good Reason or written notice of the Participant’s involuntary termination is not provided) and ending on the last day of the calendar month that is the Designated Number of months after such Notice Date or Termination Date, as applicable.

 

 

 

 

 

(cc)

 

Subsidiary” means, with respect to Interpublic, any corporation or other entity that is required to be combined with Interpublic as a single employer under section 414(b) or (c) of the Code.

 

 

 

 

 

(dd)

 

Termination Date” means, for any Participant, the date of the Participant’s “separation from service” (within the meaning of section 409A(a)(2)(A)(i) of the Code) with Interpublic and its Subsidiaries, as determined by Interpublic. For purposes of the Plan:

 

(1)

 

A Participant who is on a leave of absence and does not have a statutory or contractual right to reemployment shall be deemed to have had a “separation for service” on the first date that is more than six months after

 

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-7-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

 

 

the commencement of such leave of absence. However, if the leave of absence is due to any medically determinable physical or mental impairment that can be expected to last for a continuous period of six months or more, and such impairment causes the Participant to be unable to perform the duties of his position of employment or any substantially similar position of employment, the preceding sentence shall be deemed to refer to a 29-month period rather than to a six-month period; and

 

(2)

 

A sale of assets by Interpublic or a Subsidiary to an unrelated buyer that results in the Participant working for the buyer or one of its affiliates shall not, by itself, constitute a “separation from service” unless Interpublic, with the buyer’s written consent, so provides in writing 60 or fewer days before the closing of such sale.

 

2.2.

 

Rules of Construction.

 

 

 

 

 

For purposes of the Plan, unless the contrary is clearly indicated by the context:

 

(a)

 

The use of the masculine gender shall also include within its meaning the feminine and vice versa;

 

 

 

 

 

(b)

 

The use of the singular shall also include within its meaning the plural and vice versa;

 

 

 

 

 

(c)

 

The word “include” shall mean to include, but not to be limited to;

 

 

 

 

 

(d)

 

Any reference to a statute or section of a statute shall further be a reference to any successor or amended statute or section, and any regulations or other guidance of general applicability issued thereunder; and

 

 

 

 

 

(e)

 

“As soon as practicable,” with respect to any date or event, shall mean on the earliest administratively practicable date after the relevant date or event, but no later than (1) the last day of the calendar year in which the relevant date or event occurs or (2) the 90th day following the occurrence of the relevant date or event, whichever occurs later. Such earliest administratively practicable date shall be determined by Interpublic in its sole discretion.

 


Article 3. Participation

 

3.1.

 

Commencing Participation.

 

 

 

 

 

An Eligible Executive shall become a Participant in the Plan as of the later of (a) the date he becomes an Eligible Executive or (b) the Effective Date.

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-8-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

3.2.

 

Ending Participation.

 

 

 

 

 

An individual who becomes a Participant shall remain a Participant until the later of (a) the date the last required installment of his Salary Continuation Benefit (if any) and any payment required by Section 4.2(a)(2) is paid or (b) the last day of any period for which Interpublic is required to provide the benefits prescribed by Section 4.2(a)(1).

 


Article 4. Severance Benefits

 

4.1.

 

Salary Continuation Benefit.

 

(a)

 

Eligibility and Amount. If a Participant is Dismissed and timely executes and submits to Interpublic the agreement required by Article 5, Interpublic shall pay to the Participant the Salary Continuation Benefit prescribed by this Section 4.1. Except as otherwise specified by the provisions of subsection (c), below, and Sections 4.4, 4.5, and 5.1, the total amount of such Salary Continuation Benefit shall be equal to the excess of (1) the Participant’s Base Salary for his Designated Number of months over (2) any base salary paid to the Participant for the period starting on his Notice Date (if applicable) and ending on his Termination Date.

 

 

 

 

 

(b)

 

Form and Time of Payment of Salary Continuation Benefit. Interpublic shall pay the Salary Continuation Benefit prescribed by subsection (a), above, in semi-monthly installments (without interest); provided, however, that if the Participant is Dismissed within two years after a Change of Control, such Salary Continuation Benefit shall be paid in a lump sum. Before withholding, each installment shall be equal to one-half of the Participant’s Base Salary for one month, except that any residual amount in respect of a period of less than one-half of a month shall be paid together with the last installment. Except as required by Section 4.3:

 

 

(1)

 

Payment of the Salary Continuation Benefit shall commence on the Commencement Date, and each subsequent installment shall be paid in accordance with Interpublic’s standard semi-monthly payroll schedule; provided that no payment shall be made before the Participant executes and submits to Interpublic the agreement required by Article 5 and the period for revoking such agreement expires.

 

 

 

 

 

(2)

 

If the Participant executes and submits to Interpublic the agreement required by Article 5 in a timely manner, but the period for revoking such agreement expires after the Commencement Date, the first semi-monthly installment shall be paid on Interpublic’s first semi-monthly pay date after the period for revoking the agreement expires. Such first installment shall include a make-up payment equal to the sum of the semi-monthly installments that would have been paid to the Participant before the date the first installment is actually paid if the first installment had been paid on the Commencement Date (without interest).

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-9-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

(c)

 

Employment with Another Interpublic Agency. If a Participant is Dismissed but is later hired or rehired by Interpublic or a Subsidiary, the amount of each remaining semi-monthly payment required by subsections (a) and (b), above, shall be reduced (but not below zero) by the amount of the base salary payable to the Participant for the applicable semi-monthly pay period under the terms of his re-employment.

 

 

 

 

 

(d)

 

Death. If a Participant dies after being Dismissed or being notified that he will be Dismissed, but before receiving his entire Salary Continuation Benefit, Interpublic shall pay to the Participant’s estate an amount equal to the portion of the Participant’s Salary Continuation Benefit that has not yet been paid to the Participant. Such payment shall be made in a lump sum (without any discount or interest to reflect the time value of money) as soon as practicable after the Participant’s death. For purposes of this Section 4.1(d), if the Participant’s death occurs before his Termination Date, the date of his death shall be treated as his Termination Date.

 

 

 

 

 

(e)

 

Separate Payments. For purposes of section 409A of the Code, each installment required by this Section 4.1 shall be treated as a separate payment.

4.2.

 

Medical, Dental, and Vision Benefits.

 

 

(a)

 

Benefit Continuation or Cash Payments. If a Participant is Dismissed and timely executes and submits to Interpublic the agreement required by Article 5, Interpublic shall provide to the Participant the following benefits or cash payments, except as otherwise specified by the provisions of Sections 4.4, 4.5, and 5.1:

 

(1)

 

Throughout the Participant’s Severance Period and his COBRA Period (which periods shall be consecutive), the Participant shall be eligible for continued medical, dental, and vision benefits under one or more plans maintained by Interpublic or a Subsidiary, subject to the Participant’s payment of any premiums required by such plan or plans, at the Applicable Premium Rate; provided that:

 

 

(A)

 

The Participant shall cease to be eligible for any benefit under this subsection (a) (except to the extent that he is entitled to continuation coverage under COBRA or any similar applicable federal or state law) upon the earlier of:

 

(i)

 

His death or

 

 

 

 

 

(ii)

 

The first day after his Termination Date that he (I) commences employment (or re-employment) with Interpublic or a Subsidiary or (II) becomes eligible to be covered by another employer’s plan (or plans) providing medical benefits by reason of being employed by such other employer; and

 

 

(B)

 

If Interpublic or the Administrative Committee determines at any time that any benefits to be provided pursuant to this paragraph (1) will be includible in the Participant’s gross income under the

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-10-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

 

 

Code, this paragraph (1) shall not require Interpublic or any Subsidiary to provide such benefits to the Participant thereafter, and Interpublic shall pay to the Participant, in lieu of such benefits, the cash payments prescribed by paragraph (2), below.

 

(2)

 

If, pursuant to paragraph (1), above, the Participant becomes entitled to receive cash payments in lieu of benefits, Interpublic shall make such cash payments to the Participant in accordance with the following provisions:

 

 

(A)

 

The amount of the payment for each month from the first date as of which benefits are not provided pursuant to paragraph (1), above, through the last day of the Participant’s COBRA Period shall be equal to 167 percent of the excess of:

 

(i)

 

The aggregate premium or premiums that the Participant would be required to pay for medical, dental, and vision coverage for such month at the level required by paragraph (1), above, purchased through COBRA continuation coverage (to the extent available) or from a reputable private insurer (to the extent that COBRA continuation coverage is not available), as determined by the third-party administrator of Interpublic’s Executive Medical Plus Plan, over

 

 

 

 

 

(ii)

 

The Applicable Premium Rate for such month.

 

 

(B)

 

Except as required by Section 4.3, the payments required by this paragraph (2) shall be made in quarterly installments (with each installment equal to the sum of the amounts prescribed by subparagraph (A), above, for the next three months (but not for any month after the last day of the Participant’s COBRA Period)), starting on or as soon as practicable after the first day of the first month for which the Participant is entitled to receive the payments required by this paragraph (2). For purposes of section 409A of the Code, each installment required by this Section 4.2(a)(2) shall be treated as a separate payment.

 

 

 

 

 

(C)

 

Interpublic shall not be required to make any payment to or on behalf of a Participant pursuant to this paragraph (2) for any month after the earliest of:

 

(i)

 

The last day of the Participant’s COBRA Period;

 

 

 

 

 

(ii)

 

The Participant’s death;

 

 

 

 

 

(iii)

 

The first day after the Participant’s Termination Date on which he (I) commences employment (or re-employment) with Interpublic a Subsidiary or (II) becomes eligible to be covered by another employer’s plan (or plans) providing medical benefits by reason of being employed by such other employer; or

 

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-11-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

(iv)

 

The Participant’s failure to provide, on or before a reasonable deadline (of not less than 30 days) specified by Interpublic in a written notice that Interpublic provides to the Participant at least 30 days in advance, documentation establishing that (I) the Participant has purchased medical, dental, and/or vision coverage (as applicable) at the level on which the amount of any prior payments pursuant to this paragraph (2) were based, and (II) such coverage remains in effect when the Participant provides such documentation.

 

(b)

 

Indemnification.

 

 

(1)

 

Subject to paragraph (3), below, Interpublic shall indemnify and hold the Participant and his estate harmless for any and all losses, expenses, and other financial detriments (including attorneys’ fees) that the Participant or his estate incurs during the period that ends on the tenth anniversary of the Participant’s death in connection with the imposition of federal income tax on any benefits provided pursuant to paragraph (a)(1), above. The Participant (or, following the Participant’s death, his estate) shall submit any request for reimbursement pursuant to this paragraph (1) in writing to Interpublic (accompanied by any evidence thereof that Interpublic reasonably requests in writing within 30 days after Interpublic is first notified that such financial detriment was incurred) within 180 days after the applicable loss, expense, or other financial detriment is incurred (or, if later, within 30 days after Interpublic reasonably requests in writing evidence of such financial detriment). Subject to paragraph (4), below, Interpublic shall pay any reimbursement required by this paragraph (1) within 30 days after it receives such request.

 

 

 

 

 

(2)

 

Subject to paragraph (3), below, if:

 

(A)

 

the Internal Revenue Service or a certified public accountant engaged by the Participant or his estate determines that any benefit provided pursuant to paragraph (a)(1), above, is includible in the Participant’s gross income for any taxable year;

 

 

 

 

 

(B)

 

the Participant or his estate pays the applicable income tax and any interest and penalty;

 

 

 

 

 

(C)

 

the Participant or his estate notifies Interpublic in writing of any payment described in subparagraph (B), above, within 180 days after the Participant or his estate makes such payment; and

 

 

 

 

 

(D)

 

within 30 days after Interpublic receives the notification required by subparagraph (C), above, Interpublic reasonably requests in writing reasonable evidence of (i) the determination referred to in subparagraph (A), above, and/or (ii) the payment referred to in subparagraph (B), above, and the Participant or his estate provides such evidence within 30 days after he receives such written request from Interpublic,

 

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-12-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

 

 

then, subject to paragraphs (3) and (4), below, Interpublic shall, within 30 days after it receives the notice and any evidence required by subparagraph (D), above, pay to the Participant (or, following the Participant’s death, his estate) the amount required to put the Participant (or, following the Participant’s death, his estate) in the same after-tax position that he would have been in if he had not paid such income tax, interest, and penalties.

 

(3)

 

Upon written request by Interpublic, the Participant (or, following the Participant’s death, his estate) shall:

 

 

(A)

 

Seek a refund of any such tax, interest, or penalty for which Interpublic has reimbursed the Participant or his estate pursuant to this subsection (b), provided that Interpublic shall designate a representative to represent the Participant (or, following the Participant’s death, his estate), at Interpublic’s expense, in any refund proceeding;

 

 

 

 

 

(B)

 

Comply with any reasonable written requests that Interpublic makes for assistance in obtaining such a refund, provided that Interpublic shall reimburse the Participant (or, following the Participant’s death, his estate) for any reasonable costs and expenses he incurs in providing such assistance; and

 

 

 

 

 

(C)

 

Assign to Interpublic the right to any refund that the Participant or his estate receives, or has a right to receive, from the U.S. Treasury as a result of such efforts, up to the amount that Interpublic paid or caused to be paid to, or on behalf of, the Participant pursuant to this subsection (b).

 

(4)

 

If Interpublic determines that the Participant is a “specified employee” (within the meaning of section 409A(a)(2)(B)(i) of the Code, and determined in accordance with Treas. Reg. § 1.409A-1(i)) as of his Termination Date, payment of any amount required by this Section 4.2(b) shall not be made before the first day of the seventh month after the Participant’s Termination Date. If paragraph (1) or (2), above, prescribes an earlier payment date, payment shall be made, without interest, on or within 30 days after the first day of the seventh month after the Participant’s Termination Date.

 

4.3.

 

Delay of Payment to Specified Employees.

 

 

 

 

 

This Section 4.3 is intended to comply with the requirement under Section 409A(a)(2)(B)(i) of the Code to delay certain post-termination payments to “specified employees” (within the meaning of section 409A(a)(2)(B)(i) of the Code) for six months after the Termination Date. In order to avoid an inadvertent violation of such requirement, the restrictions set forth in this Section 4.3 may be more restrictive than is required under section 409A(a)(2)(B)(i) of the Code. However, this Section 4.3 shall not be construed to allow payment of any amount at any time that would cause a violation of section 409A(a)(2)(B)(i) of the Code.

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-13-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

(a)

 

If (x) Interpublic determines that the Participant is a “specified employee” (within the meaning of section 409A(a)(2)(B)(i) of the Code, and determined in accordance with Treas. Reg. § 1.409A-1(i)) as of his Termination Date, and (y) the sum of the Participant’s Restricted Severance Payments that are scheduled to be made before the first day of the seventh month following the Participant’s Termination Date exceeds the Participant’s Severance Exclusion Amount, then:

 

(1)

 

Each payment that Section 4.1(b)(1) requires to be made on or before March 15th of the first calendar year that begins after the Participant’s Termination Date shall be made at the time prescribed by Section 4.1(b)(1). Interpublic shall determine whether a payment is required to be made on or before March 15th of the first calendar year that begins after the Participant’s Termination Date based on the facts known as of the date the Participant first became eligible to participate in the Plan;

 

 

 

 

 

(2)

 

Each payment required by Sections 4.1 and 4.2(a)(2), other than a payment described by paragraph (1), above, shall be made at the time prescribed by Section 4.1(b)(1) or 4.2(a)(2)(B), as applicable, until the sum of (A) such payments and (B) all Separation Payments made to the Participant under any Other Arrangement equals the Participant’s Severance Exclusion Amount; and

 

 

 

 

 

(3)

 

To the extent that any payment required by Sections 4.1 and 4.2(a)(2), other than a payment described by paragraph (1), above, cannot be made by reason of paragraph (2), above, such payment shall be made on the later of —

 

 

(A)

 

Interpublic’s first semi-monthly pay date for the seventh month after the Participant’s Termination Date (or, if earlier, as soon as practicable after the Participant’s death), or

 

 

 

 

 

(B)

 

The date when such payment would otherwise be due in accordance with Sections 4.1 and 4.2(a)(2).

 

 

 

Interest shall not be added to any payment that is delayed by reason of the application of this Section 4.3.

 

4.4.

 

Non-duplication, Coordination, and Right to Change Benefit Plans

 

(a)

 

No provision of this Plan shall require (or be interpreted to require) Interpublic or any Subsidiary to duplicate any payment or other compensation or benefit that a Participant is entitled to receive under any Other Arrangement.

 

 

 

 

 

(b)

 

The amount of the Salary Continuation Benefit payment required by Section 4.1 for each pay period (determined without regard to any delay in payment) shall be reduced dollar-for-dollar (but not below zero) by the amount of any salary continuation or similar severance payment that the Participant is entitled to receive for the applicable semi-monthly pay period (determined without regard to any delay in payment) pursuant to any Other Arrangement. If the Plan or an Other Arrangement provides for a salary continuation or similar severance benefit paid in a form other than semi-monthly installments, such benefit shall be

 

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-14-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

 

 

expressed for purposes of applying this Section 4.4(b) as an equivalent benefit payable in semi-monthly installments, without regard to any delay in payment and without any adjustment for interest. For example, for purposes of applying this Section 4.4(b):

 

(1)

 

A lump-sum severance payment equal to 12 months’ base salary shall be treated as if it were paid for 12 months in 24 semi-monthly installments, each equal to 1/24th of the Participant’s annual base salary, commencing on the date prescribed by the Other Arrangement;

 

 

 

 

 

(2)

 

A severance benefit payable in monthly installments shall be treated as if it were paid in semi-monthly installments, with each semi-monthly installment equal to one-half of the monthly installment required by the Other Arrangement; and

 

 

 

 

 

(3)

 

If payment to a Participant is delayed by reason of Section 4.3, the amount of the Participant’s Salary Continuation Benefit payment required by Section 4.1 for each pay period shall be determined as if payments commenced on the Commencement Date. Any delay of payment required by an Other Arrangement shall be similarly disregarded.

 

 

(c)

 

The amount of any payment required under Section 4.2(a)(2) for any quarter (determined without regard to any delay in payment) shall be reduced dollar-for-dollar (but not below zero) by the amount of any reimbursement or allowance for medical, dental, or vision benefit premiums (including COBRA premiums) that the Participant is entitled to receive for such quarter (determined without regard to any delay in payment) pursuant to any Other Arrangement.

 

 

 

 

 

(d)

 

Subject to this Section 4.4, the benefits provided under the Plan (after reduction pursuant to subsections (b) and (c), above) shall be in addition to any compensation or benefits the Participant is eligible to receive under any Other Arrangement.

 

 

 

 

 

(e)

 

No provision of this Plan shall restrict the ability of Interpublic or any Subsidiary to amend, suspend, or terminate any or all of its employee benefit plans and programs (not including this Plan) from time to time, or prevent any such amendment, suspension, or termination from affecting any Participant; provided, that the restrictions set forth in Section 7.4 shall apply with respect to any amendment, suspension, or termination of this Plan.

4.5.

 

Forfeiture of Certain Parachute Payments.

 

 

(a)

 

Notwithstanding any provision in the Plan to the contrary, if subsection (b), below, applies, a Participant shall forfeit amounts payable to him under the Plan to the extent that a firm selected in accordance with subsection (c), below, determines is necessary to ensure that the Participant is not reasonably likely to receive a “parachute payment” under section 280G(b)(2) of the Code.

 

 

 

 

 

(b)

 

This subsection (b) shall apply if:

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-15-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

(1)

 

Any payment to be made under the Plan is reasonably likely to result in the Participant receiving a “parachute payment” (as defined in section 280G(b)(2) of the Code), and

 

(2)

 

The Participant’s forfeiture of payments due under the Plan would result in the aggregate after-tax amount the Participant would receive being greater than the aggregate after-tax amount the Participant would receive if there were no such forfeiture.

 

 

(c)

 

The amount of any forfeiture pursuant to subsection (a), above, shall be conclusively determined by either of the following firms, as engaged by Interpublic at Interpublic’s expense:

 

(1)

 

The outside auditing firm retained by Interpublic for the last fiscal year ending before a Change of Control, or

 

 

 

 

 

(2)

 

A national auditing firm acceptable to the Participant.

 

 

(d)

 

If the firm engaged pursuant to subsection (c), above, determines that a Participant could avoid adverse tax consequences relating to Section 280G of the Code (determined on a net after-tax basis) by forfeiting payments under one or more Other Arrangements, and such Other Arrangements permit a forfeiture to avoid adverse tax consequences relating to Section 280G of the Code, the Participant shall not forfeit his right to receive any amount due under this Plan unless and until he has forfeited his right to all payments under such Other Arrangements; provided, however, that the Participant shall not forfeit any right to severance under a Change of Control or employment agreement unless and until he has forfeited his right to severance under this Plan.

 


Article 5. Release and Covenants

 

5.1.

 

Benefits Contingent on Executing Agreement.

 

 

 

 

 

A Participant shall not be entitled to any benefits under this Plan unless he executes and does not subsequently revoke or materially breach an agreement that is materially the same as the model agreement set forth in Exhibit A to the Plan. Except to the extent that Interpublic and the Participant may agree to modifications, such agreement shall:

 

(a)

 

Include a release that is materially the same as the release of claims in paragraph 3 of the model agreement set forth in Exhibit A to the Plan;

 

 

 

 

 

(b)

 

Include intellectual property, non-disparagement, return of property, and confidentiality covenants that are materially the same as the covenants set forth in paragraphs 8, 10, and 11 of the model agreement set forth in Exhibit A to the Plan, which shall be binding on the Participant for all time;

 

 

 

 

 

(c)

 

Provide that, during the period that begins on the Participant’s Termination Date and ends on the later of (x) the date the last payment to the Participant under this

 

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-16-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

 

 

Plan is due or (y) the first anniversary of the Participant’s Termination Date, the Participant shall not:

 

(1)

 

Directly or indirectly, either on the Participant’s own behalf or on behalf of any other person, firm, or corporation, solicit any account that is a client of the Participant’s Employer at any time during the one-year period ending on the Participant’s Termination Date;

 

 

 

 

 

(2)

 

Perform any services relating to advertising, marketing, research, public relations, or related services for any person (including any company or other entity) that is a client of the Participant’s Employer at any time during the one-year period ending on the Participant’s Termination Date; or

 

 

 

 

 

(3)

 

Directly or indirectly employ or attempt to employ, or assist anyone else to employ, any person who was in the employ of the Participant’s Employer at any time during the six-month period ending on the Participant’s Termination Date; and

 

 

(d)

 

Provide that if the Participant commences any form of employment or partnership (including as an advisor, consultant or otherwise) with any business that is in competition with the business of the Participant’s Employer, he shall (A) immediately forfeit his right to all then-remaining payments to which he would otherwise be entitled under the Plan and (B) cease to be eligible for any benefit under Section 4.2(a).

5.2.

 

Time Limit for Executing Agreement.

 

 

(a)

 

Interpublic or a Subsidiary shall deliver, or cause to be delivered, an executable copy of the agreement required by Section 5.1 on or before the fifth business day after the Participant’s Termination Date.

 

 

 

 

 

(b)

 

If the agreement provided pursuant to subsection (a), above, is acceptable to the Participant (after consultation with an attorney), he shall submit to Interpublic an executed copy of the agreement by the following deadline:

 

(1)

 

Unless the Participant is Dismissed in connection with an exit incentive or other employment termination program that affects more than one employee, the deadline shall be 21 days after the agreement is delivered to the Participant.

 

 

 

 

 

(2)

 

If the Participant is Dismissed in connection with an exit incentive or other employment termination program that affects more than one employee, the deadline shall be 45 days after the agreement is delivered to the Participant.

 

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-17-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 


Article 6. Nature of Participant’s Interest in and Rights Under the Plan

 

6.1.

 

No Right to Assets.

 

 

 

 

 

Participation in the Plan does not create any right or lien in favor of any Participant in or against any asset of Interpublic or any Subsidiary. Nothing contained in the Plan, and no action taken under its provisions, shall create or be construed to create a trust of any kind, or a fiduciary relationship, between (a) Interpublic or any Subsidiary and (b) a Participant or any other person. The provision for benefits pursuant to this Plan shall at all times remain unfunded as to each Participant, and the rights of each Participant and any beneficiary under the Plan shall be limited to those of a general and unsecured creditor of Interpublic and its Subsidiaries.

 

 

 

6.2.

 

No Right to Transfer Interest.

 

 

 

 

 

Except to the extent necessary to fulfill a domestic relations order (as defined in section 414(p)(1)(B) of the Code), rights to benefits payable under the Plan shall not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, hypothecation, encumbrance, charge, execution, attachment, levy, or similar process.

 

 

 

6.3.

 

No Employment Rights.

 

 

 

 

 

No provisions of the Plan and no action taken by (a) Interpublic, any Subsidiary, the Board of Directors (including any committee thereof), the Administrative Committee, or (b) any agent or designee of Interpublic, a Subsidiary, the Board of Directors, or the Administrative Committee shall give any person any right to be retained in the employ of Interpublic or any Subsidiary. Interpublic and its Subsidiaries specifically reserve the right and power to dismiss or discharge any Participant at any time and for any reason, to the full extent permitted by applicable law.

 

 

 

6.4.

 

Withholding and Tax Liabilities.

 

 

 

 

 

All payments and other compensation under the Plan shall be subject to withholding of income and employment taxes and other amounts (including any offset to which Interpublic or a Subsidiary has a right) that Interpublic or its designee reasonably determines to be required to be withheld, whether with respect to payments or other compensation pursuant to the Plan or other payments or compensation from Interpublic or a Subsidiary. In addition, except as provided by Section 4.2(b), each Participant shall be solely responsible for paying all required taxes (including any excise taxes) on all payments and other compensation (including imputed compensation) and benefits provided under the Plan, regardless of whether taxes are withheld or the amount withheld. Except as provided by Section 4.2(b), no provision of the Plan shall be construed (a) to limit the Participant’s responsibility under this Section 6.4 or (b) to transfer to or impose on Interpublic or any Subsidiary any liability relating to taxes (including excise taxes) on compensation (including imputed compensation) or other income under this Plan.

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-18-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 


Article 7. Administration, Interpretation, and Modification of Plan

 

7.1.

 

Plan Administrator.

 

 

 

 

 

The Plan shall be administered by the Administrative Committee.

 

 

 

7.2.

 

Powers of the Administrator and Review of Determinations.

 

(a)

 

Prior to a Change of Control, the Administrative Committee shall have complete and exclusive discretionary authority and responsibility to:

 

 

(1)

 

Administer, construe, and interpret the Plan;

 

 

 

 

 

(2)

 

Establish such rules and regulations as it deems necessary or desirable for the proper and effective administration of the Plan;

 

 

 

 

 

(3)

 

Resolve any ambiguity, inconsistency, or omission by general rule or particular decision;

 

 

 

 

 

(4)

 

Make factual determinations;

 

 

 

 

 

(5)

 

Settle and determine any contributions and disputes as to rights or benefits under the Plan; and

 

 

 

 

 

(6)

 

Take such actions in connection with and for the purposes of the Plan as it believes advisable to carry out the purposes of the Plan and to maintain its operation.

 

(b)

 

The Administrative Committee is authorized to delegate any of its duties and responsibilities under the Plan as the Administrative Committee deems appropriate. In addition, the Administrative Committee is authorized to employ one or more persons to render advice with regard to any of its administrative responsibilities.

 

 

 

 

 

(c)

 

Review by a court of any determination by the Administrative Committee shall be subject to the following standard of review:

 

 

(1)

 

Prior to a Change of Control, the standard of review shall be the “arbitrary and capricious” standard.

 

 

 

 

 

(2)

 

Following a Change of Control, the standard of review shall be de novo.

7.3.

 

American Jobs Creation Act of 2004 (“AJCA”)

 

 

(a)

 

The Plan shall be operated, administered, and interpreted in accordance with (1) before January 1, 2008, a reasonable, good-faith interpretation of section 409A of the Code and section 885 of the American Jobs Creation Act of 2004, as amended (the “AJCA”) and (2) after December 31, 2007, section 409A of the Code and the AJCA.

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-19-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

(b)

 

If Interpublic or the Administrative Committee determines that any provision of the Plan is or might be inconsistent with the restrictions imposed by section 409A of the Code or the AJCA, Interpublic or the Administrative Committee may amend the Plan to the extent that Interpublic or the Administrative Committee determines, based on the advice of outside counsel, is necessary to bring it into compliance with section 409A of the Code and the AJCA.

 

 

 

 

 

(c)

 

No provision in the Plan shall be interpreted or construed to transfer any liability for a failure to comply with section 409A of the Code from a Participant or other individual to Interpublic, any Subsidiary, or any other entity or individual affiliated with Interpublic and its Subsidiaries.

7.4.

 

Amendment, Suspension, and Termination.

 

 

(a)

 

Subject to the restrictions set forth in this Section 7.4, the Board of Directors or any person duly authorized by resolution of the Board of Directors may, pursuant to a written instrument, amend, suspend, or terminate the Plan at any time. In addition, the Administrative Committee may amend the Plan to the extent that it deems necessary or desirable:

 

(1)

 

To improve the administration of the Plan, so long as such amendment does not materially affect the substance of the Plan or the level of benefits the Plan provides, or

 

 

 

 

 

(2)

 

To comply with any applicable federal, state, or local law (including tax laws that could result in adverse tax consequences to any Participant or Interpublic or any Subsidiary).

 

 

(b)

 

No amendment, suspension, or termination of the Plan that might reduce the level of benefits available under the Plan shall be given effect with respect to any Participant who:

 

(1)

 

Was a Participant on the day before the later of (A) the effective date of such amendment, suspension, or termination, or (B) the date such amendment, suspension, or termination is adopted (such later date being the “Amendment Date”), and

 

 

 

 

 

(2)

 

On or before the second anniversary of the Amendment Date is either (A) Dismissed or (B) notified that he will be Dismissed,

 

 

 

 

unless such Participant expressly consents in writing to such amendment, suspension, or termination.

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-20-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 


Article 8. Claims and Appeals

 

8.1.

 

Application of Claims and Appeals Procedures.

 

(a)

 

The provisions of this Article 8 shall apply to any claim for a benefit under the Plan, regardless of the basis asserted for the claim and regardless of when the act or omission upon which the claim is based occurred.

 

 

 

 

 

(b)

 

No claim for non-payment or underpayment of benefits allegedly owed under the Plan may be filed in court until the claimant has exhausted the claims review procedures established in accordance with this Article 8.

 

8.2.

 

Initial Claims.

 

(a)

 

Any claim for benefits shall be in writing (which may be electronic if permitted by the Administrative Committee) and shall be delivered to a claims administrator designated in writing by the Administrative Committee.

 

 

 

 

 

(b)

 

Each claim for benefits shall be decided by the claims administrator or the Administrative Committee (as determined by the Administrative Committee) within a reasonable period of time, but not later than 90 days after such claim is received by the claims administrator (without regard to whether the claim submission includes sufficient information to make a determination), unless the claims administrator or the Administrative Committee determines that special circumstances require an extension of time for processing the claim. If the claims administrator or the Administrative Committee determines that an extension of time for processing is required, the claims administrator or the Administrative Committee shall notify the claimant in writing before the end of the initial 90-day period of the circumstances requiring an extension of time and the date by which a decision is expected.

 

 

 

 

 

(c)

 

If any claim is denied in whole or in part, the claims administrator or the Administrative Committee shall provide to the claimant a written decision, issued by the end of the period prescribed by subsection (b), above, that includes the following information:

 

 

(1)

 

The specific reason or reasons for denial of the claim;

 

 

 

 

 

(2)

 

References to the specific Plan provisions upon which such denial is based;

 

 

 

 

 

(3)

 

A description of any additional material or information necessary to perfect the claim, and an explanation of why such material or information is necessary;

 

 

 

 

 

(4)

 

An explanation of the appeal procedures Plan’s and the applicable time limits; and

 

 

 

 

 

(5)

 

A statement of the claimant’s right to bring a civil action under section 502(a) of ERISA, if his claim is denied upon review.

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-21-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

8.3.

 

Appeals.

 

(a)

 

If a claim for benefits is denied in whole or in part, the claimant may appeal the denial to the Administrative Committee. Such appeal shall be in writing (which may be electronic, if permitted by the Administrative Committee), may include any written comments, documents, records, or other information relating to the claim for benefits, and shall be delivered to the Administrative Committee within 60 days after the claimant receives written notice that his claim has been denied.

 

 

 

 

 

(b)

 

The Administrative Committee shall decide each appeal within a reasonable period of time, but not later than 60 days after such claim is received by the Administrative Committee, unless the Administrative Committee determines that special circumstances require an extension of time for processing the appeal.

 

 

(1)

 

If the Administrative Committee determines that an extension of time for processing is required, the Administrative Committee shall notify the claimant in writing before the end of the initial 60-day period of the circumstances requiring an extension of time and the date by which the claims administrator expects to render a decision.

 

 

 

 

 

(2)

 

If an extension of time pursuant to paragraph (1), above, is due to a claimant’s failure to submit information necessary to decide the appeal, the period for deciding the appeal shall be tolled from the date on which the notification of extension is sent to the claimant until the date on which the claimant responds to the request for additional information.

 

(c)

 

In connection with any appeal, a claimant shall be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to his claim for benefits. A document, record, or other information shall be considered relevant to a claim for benefits if such document, record, or other information:

 

 

(1)

 

Was relied upon in making the benefit determination;

 

 

 

 

 

(2)

 

Was submitted, considered, or generated in the course of making the benefit determination, without regard to whether such document, record, or other information was relied upon in making the benefit determination; or

 

 

 

 

 

(3)

 

Demonstrates compliance with processes and safeguards designed to ensure and to verify that the benefit determination was made in accordance with the terms of the Plan and that such terms of the Plan have been applied consistently with respect to similarly situated claimants.

 

(d)

 

The Administrative Committee’s review on appeal shall take into account all comments, documents, records and other information submitted by the claimant, without regard to whether such information was considered in the initial benefit determination.

 

 

 

 

 

 

 

 

 

 

 

 

Interpublic Executive Severance Plan

 

-22-

 

June 1, 2007

 

<hr size=2 width="100%" noshade color=gray align=center>

 

 

(e)

 

If any appeal is denied in whole or in part, the Administrative Committee shall provide to the claimant a written decision, issued by the end of the period prescribed by subsection (b), above, that includes the following information:

 

(1)

 

The specific reason or reasons for the decision;

 

 

 

 

 

(2)

 

References to the specific Plan provisions upon which the decision is based;

 

 

 

 

 

(3)

 

An explanation of the claimant’s right to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to his claim for benefits (as determined pursuant to subsection (c), above); and

 

 

 

 

 

(4)

 

A statement of the claimant’s right to bring a civil action under section 502(a) of ERISA.

 

8.4.

 

Other Rules and Rights Regarding Claims and Appeals.

 

(a)

 

A claimant may authorize a representative to pursue any claim or appeal on his behalf. The Administrative Committee may establish reasonable procedures for verifying that any representative has in fact been authorized to act on his behalf.

 

 

 

 

 

(b)

 

Notwithstanding the deadlines prescribed by this Article 8, the Administrative Committee and any claimant may agree to a longer period for deciding a claim or appeal or for filing an appeal, provided that the Administrative Committee shall not extend any deadline for filing an appeal unless imposition of the deadline prescribed by Section 8.3(a) would be unreasonable under the applicable circumstances.