EXECUTIVE SPECIAL BENEFIT AGREEMENT
AGREEMENT made as of April 1, 1996, by and between
THE INTERPUBLIC GROUP OF COMPANIES, INC., a corporation of the
State of Delaware (hereinafter referred to as "Interpublic"), and
XXXXXX XXXXX (hereinafter referred to as "Executive"):
W I T N E S S E T H
WHEREAS, Executive is in the employ of Interpublic
and/or one or more of its subsidiaries (Interpublic and its
subsidiaries being hereinafter referred to collectively as the
"Corporation"); and
WHEREAS, Interpublic and Executive desire to enter
into an Executive Special Benefit Agreement which shall be
supplementary to any employment agreement or arrangement which
Executive now or hereafter may have with respect to Executive's
employment by Interpublic or any of its subsidiaries;
NOW, THEREFORE, in consideration of the mutual
promises herein set forth, the parties hereto, intending to be
legally bound, agree as follows:
ARTICLE I
Death and Special Retirement Benefits
1.01 SECTION INTENTIONALLY OMITTED
1.02 In lieu of Executive's rights with respect
to a bonus as set forth in Section 4.03 of the Employment
Agreement made as of August 11, 1994 by and among Interpublic,
Xxxxxxxx & Puris Inc. and Executive, which rights Executive
hereby expressly waives, the Corporation shall provide Executive
with the following benefits contingent upon Executive's
compliance with all the terms and conditions of this Agreement
and Executive's satisfactory completion of a physical examination
in connection with an insurance policy on the life of Executive
which Interpublic or its assignee (other than Executive) proposes
to obtain and own.
1.03 If, during a period of employment by the
Corporation which is continuous from the date of this Agreement,
Executive shall die while in the employ of the Corporation, the
Corporation shall pay to such beneficiary or beneficiaries as
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Executive shall have designated pursuant to Section 1.07 (or in
the absence of such designation, shall pay to the Executor of the
Will or the Administrator of the Estate of Executive) survivor
income payments of Three Hundred Thousand Dollars ($300,000) per
annum for fifteen years following Executive's death, such
payments to be made on January 15 of each of the fifteen years
beginning with the year following the year in which Executive
dies.
1.04 If, after a continuous period of
employment from the date of this Agreement, Executive shall
retire from the employ of the Corporation so that the first day
on which Executive is no longer in the employ of the Corporation
occurs on or after Executive's sixty-fifth birthday, the
Corporation shall pay to Executive special retirement benefits at
the rate of Three Hundred Thousand Dollars ($300,000) per annum
for fifteen years beginning with the calendar month following
Executive's last day of employment, such payments to be made in
equal monthly installments.
1.05 If, after a continuous period of
employment from the date of this Agreement, Executive shall
retire, resign, or be terminated from the employ of the
Corporation so that the first day on which Executive is no longer
in the employ of the Corporation occurs on or after Executive's
sixty-third birthday but prior to Executive's sixty-fifth
birthday, the Corporation shall pay to Executive special
retirement benefits at the annual rates set forth below for
fifteen years beginning with the calendar month following
Executive's last day of employment, such payments to be made in
equal monthly installments:
Last Day of Employment Annual Rate
On or after 63rd birthday but
prior to 64th birthday $ 230,000
On or after 64th birthday but
prior to 65th birthday $ 265,000
1.06 If, following such termination of
employment, Executive shall die before payment of all of the
installments provided for in Section 1.04 or Section 1.05, any
remaining installments shall be paid to such beneficiary or
beneficiaries as Executive shall have designated pursuant to
Section 1.07 or, in the absence of such designation, to the
Executor of the Will or the Administrator of the Estate of
Executive.
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1.07 For purposes of Sections 1.03, 1.04 and
1.05, or any of them, Executive may at any time designate a
beneficiary or beneficiaries by filing with the chief personnel
officer of Interpublic a Beneficiary Designation Form provided by
such officer. Executive may at any time, by filing a new
Beneficiary Designation Form, revoke or change any prior
designation of beneficiary.
1.08 If Executive shall die while in the employ
of the Corporation, no sum shall be payable pursuant to Sections
1.04, 1.05, 1.06, 2.01, 2.02 or 2.03.
1.09 In connection with the life insurance
policy referred to in Section 1.02, Interpublic has relied on
written representations made by Executive concerning Executive's
age and the state of Executive's health. If said representations
are untrue in any material respect, whether directly or by
omission, and if the Corporation is damaged by any such untrue
representations, no sum shall be payable pursuant to Sections
1.03, 1.04, 1.05, 1.06, 2.01, 2.02 or 2.03.
1.10 It is expressly agreed that Interpublic or
its assignee (other than Executive) shall at all times be the
sole and complete owner and beneficiary of the life insurance
policy referred to in Sections 1.02 and 1.09, shall have the
unrestricted right to use all amounts and exercise all options
and privileges thereunder without the knowledge or consent of
Executive or Executive's designated beneficiary or any other
person and that neither Executive nor Executive's designated
beneficiary nor any other person shall have any right, title or
interest, legal or equitable, whatsoever in or to such policy.
ARTICLE II
Alternative Deferred Compensation
2.01 If Executive shall, for any reason other
than death, cease to be employed by the Corporation on a date
prior to Executive's sixty-third birthday, the Corporation shall,
in lieu of any payment pursuant to Article I of this Agreement,
compensate Executive by payment, at the time and in the manner
specified in Section 2.02, of the sum of One Million Five Hundred
Thousand Dollars ($1,500,000). Such payment shall be conditional
upon Executive's compliance with all the terms and conditions of
this Agreement and shall be made without any payment of interest.
However, if such cessation of employment is made at the behest of
the Corporation without "cause" as defined below, or at the
behest of Executive for "good reason" as defined in Section 6.02
of his Employment Agreement dated August 11, 1994, then the
payment called for by this section 2.01 shall be made with
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interest at the prime rate plus 1%, adjusted and compounded
semi-annually during the period from April 1, 1996 until the date
of payment. For purposes of this section, "cause" shall be
defined as follows:
(i) the conviction of, or pleading guilty or no
contest to, a felony or crime involving moral turpitude; or
(ii) the willful and continued failure of the
Executive to substantially perform his duties to Interpublic or
one of its affiliates (other than any such failure resulting from
physical or mental disability), after written demand for
substantial performance is delivered to Executive by the Board of
Directors (the "Board") of Interpublic, which demand the Board
subsequently determines in good faith has not been satisfactorily
responded to by the Executive.
2.02 The compensation payable under Section
2.01 shall be paid in one lump sum in the month following the
month in which Executive is no longer in the employ of the
Corporation.
2.03 If Executive dies prior to receiving the
payment in accordance with the provisions of Section 2.02, said
payment shall be paid to the Executor of the Will or the
Administrator of the Estate of Executive.
2.04 It is understood that none of the payments
made in accordance with this Agreement shall be considered for
purposes of determining benefits under the Interpublic Pension
Plan, nor shall such sums be entitled to credits equivalent to
interest under the Plan for Credits Equivalent to Interest on
Balances of Deferred Compensation Owing under Employment
Agreements adopted effective as of January 1, 1974 by
Interpublic.
ARTICLE III
Nonsolicitation of Clients or Employees
3.01 Following the termination of Executive's
employment hereunder for any reason, Executive shall not for a
period of twelve months from such termination either (a) solicit
any employee of the Corporation to leave such employ to enter the
employ of Executive or of any corporation or enterprise with
which Executive is then associated or (b) solicit or handle on
Executive's own behalf or on behalf of any other person, firm or
corporation, the advertising, public relations, sales promotion
or market research business of any advertiser for which the
Corporation had actively performed services for compensation
during the 180-day period immediately prior to Executive's
termination, or to whom the Corporation had made a substantive
presentation during such period seeking such advertiser's
business.
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ARTICLE IV
Assignment
4.01 This Agreement shall be binding upon and
inure to the benefit of the successors and assigns of
Interpublic. Neither this Agreement nor any rights hereunder
shall be subject in any matter to anticipation, alienation, sale,
transfer, assignment, pledge, encumbrance or charge by Executive,
and any such attempted action by Executive shall be void. This
Agreement may not be changed orally, nor may this Agreement be
amended to increase the amount of any benefits that are payable
pursuant to this Agreement or to accelerate the payment of any
such benefits.
ARTICLE V
Contractual Nature of Obligation
5.01 The liabilities of the Corporation to
Executive pursuant to this Agreement shall be those of a debtor
pursuant to such contractual obligations as are created by the
Agreement. Executive's rights with respect to any benefit to
which Executive has become entitled under this Agreement, but
which Executive has not yet received, shall be solely the rights
of a general unsecured creditor of the Corporation.
ARTICLE VI
Applicable Law
6.01 This 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______________________________________
C. XXXX XXXXXXX
______________________________________
XXXXXX XXXXX
