EMPLOYMENT AGREEMENT
AGREEMENT made as of July 1, 1995 by and between THE
INTERPUBLIC GROUP OF COMPANIES, INC., a corporation of the State
of Delaware (hereinafter referred to as "Interpublic"), and
XXXXXX X. XXXXX (hereinafter referred to as "Executive").
In consideration of the mutual promises set forth
herein the parties hereto agree as follows:
ARTICLE I
TERM OF EMPLOYMENT
1.01 Upon the terms and subject to the conditions set
forth herein, Interpublic or one of its subsidiaries will employ
Executive for the period beginning July 1, 1995 and ending on
December 31, 1997, or on such earlier date as the employment of
Executive shall terminate pursuant to Article V or Article VI.
(The period during which Executive is employed hereunder is
referred to herein as the "term of employment" and Interpublic or
whichever of its subsidiaries shall from time to time employ
Executive pursuant to this Agreement is referred to herein as the
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"Corporation"). Executive will serve the Corporation during the
term of employment. Executive shall have the option, to request
a change in employment status commencing July 1, 1997 and, if
agreed to by the Corporation, the compensation, terms and
duration of the new employment status will be mutually agreed to
by Executive and the Corporation.
ARTICLE II
DUTIES
2.01 During the term of employment Executive will:
(i) use his best efforts to promote the
interests of the Corporation and devote his full time and efforts
to its business and affairs;
(ii) perform such duties as the Corporation may
from time to time assign to him including the identification of
his successor which is acceptable to Executive and the Chief
Executive Officer and approved by the Corporation's Board of
Directors.
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(iii) serve in such offices of the Corporation or
its subsidiaries as he may be elected or appointed to which, so
long as he remains a full time employee, shall not be less than
Executive Vice President-Finance and Operations and Chief
Financial Officer, or such greater title such as he may be
elected to prior to or during the term of this Agreement.
(iv) be proposed as a member of the Corporation's
Board of Directors.
ARTICLE III
COMPENSATION
3.01 The Corporation will compensate Executive for the
duties performed by him hereunder, including all services
rendered as an officer or director of the Corporation, by payment
of a salary at the rate of $150,000 per annum, payable in equal
installments, which the Corporation may pay at either monthly or
semi-monthly intervals, and by payment of the additional
compensation specified in Section 3.02.
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3.02 Subject to the provisions of the second sentence
of this Section 3.02, and for as long as Executive remains a full
time employee, the Corporation will further compensate Executive
for the duties specified in Section 2.01 by payment, at the times
and in the manner specified in Section 3.03, of a sum ("Deferred
Compensation") computed at the rate of $600,000 per annum for
each full year and a proportionate amount for any part year
during which Executive actually performs such duties (as well as
for any period during which Executive is receiving payments
pursuant to subdivision (ii) of Section 6.01). Payment of
Deferred Compensation shall be contingent on full performance by
Executive of all his obligations under Articles I, II and VII.
3.03 The aggregate compensation payable under Section
3.02 shall be paid in 60 equal monthly installments commencing
with the month following the month in which Executive's
employment terminates for any reason, except that sums equivalent
to interest credited during such period of 60 months shall be
paid with the installment or installments payable after the date
of such crediting.
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3.04 If Executive dies while employed by the
Corporation or while receiving payments in accordance with the
provisions of subdivision (ii) of Section 6.01, any amount
payable in accordance with the provisions of Section 3.03 shall
be paid to the Executor of the Will or the Administrator of the
Estate of Executive in one lump sum.
3.05 It is understood that none of the payments made
in accordance with Sections 3.02 and 3.03 shall be considered for
purposes of determining benefits under the Interpublic Retirement
Account Plan (formerly, the Interpublic Pension Plan).
3.06 The Corporation may at any time increase the
compensation paid to Executive hereunder if the Corporation in
its discretion shall deem it advisable so to do in order to
compensate him fairly for services rendered to the Corporation.
ARTICLE IV
BONUSES
4.01 Executive will be eligible during the term of
employment to participate in the Management Incentive
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Compensation Plan ("MICP" or the "Plan") in accordance with the
terms and conditions of the Plan established from time to time,
and appropriate for an executive holding such a position..
ARTICLE V
TERMINATION
5.01 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 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, or
(ii) by giving him notice in writing at any time
specifying a termination date less than twelve months after the
date on which such notice is given. In this event his employment
hereunder shall terminate on the date specified in such notice
and the Corporation shall thereafter pay him a sum equal to the
amount by which twelve months' salary, at his then current rate
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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 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 month to be paid together with the last
installment.
(iii) However, with respect to any payments of
salary due to Executive after notice of termination shall have
been given pursuant to Sub-section 6.01 (i), should Executive
commence other employment during the period when payments
thereunder are being made, said payments shall cease forthwith.
Moreover, with respect to any payments of salary or salary
equivalents to Executive after notice of termination shall have
been given pursuant to Sub-section 6.01 (ii), should Executive
commence other employment prior to the last payment due under
that Sub-section, no further payments shall be made to Executive.
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5.02 Executive may at any time give notice in writing
to the Corporation specifying a termination date not less than
twelve 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.
5.03 If the employment of Executive hereunder is
terminated pursuant to this Article V by either the Corporation
or Executive, Executive shall continue to perform his duties
hereunder until the termination date at his salary in effect on
the date that notice of such termination is given.
5.04 If Executive dies before December 31, 1997, his
employment hereunder shall terminate on the date of his death.
ARTICLE VI
COVENANTS
6.01 While Executive is employed hereunder by the
Corporation he shall not without the prior written consent of the
Corporation 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,
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that he may continue to own or may hereafter acquire any
securities of any class of any publicly-owned company, and
further provided that he may continue his business activities
with the Westport Asset Fund and with his current outside
directorship, National Westminster Bancorp, Inc; 00 Xxxx Xxxxxx
Fund, Inc.; All American Communications, Inc.; and Micrografx,
Inc.. Executive shall be entitled to accept other outside
directorships as long as they are not with enterprises which are
competitive with the Corporation's business.
6.02 Executive shall treat as confidential and keep
secret the affairs of the Corporation and shall not at any time
during the term of employment or thereafter, without the prior
written consent of the Corporation, divulge, furnish or make
known or accessible to, or use for the benefit of, anyone other
than the Corporation and its subsidiaries and affiliates any
information of a confidential nature relating in any way to the
business of the Corporation or its subsidiaries or affiliates or
their clients and obtained by him in the course of his employment
hereunder.
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6.03 If Executive violates any provision of Section
6.01 or Section 6.02, the Corporation may, notwithstanding the
provisions of Section 5.01, terminate the employment of Executive
at any time by giving him notice in writing specifying a
termination date. In such event, his employment hereunder shall
terminate on the date specified in such notice.
6.04 All records, papers and documents kept or made by
Executive relating to the business of the Corporation or its
subsidiaries or affiliates or their clients shall be and remain
the property of the Corporation.
6.05 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 the Corporation 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
the Corporation, 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 the
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Corporation, without further compensation, upon notice to him
from the Corporation.
6.06 Following the termination of Executive's
employment hereunder or otherwise for any reason, Executive shall
not for a period of twenty-four months from such termination
either (a) solicit any employee of the Corporation or Interpublic
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 which is a client of the Corporation at the time of
such termination. However, if any of the provisions of this
Agreement are materially breached by the Corporation, or if
Executive does not receive all of the compensation to which he is
entitled hereunder, Executive will not be bound by the provisions
of this Section 6.06.
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ARTICLE VII
ASSIGNMENT
7.01 This Agreement shall be binding upon and enure to
the benefit of the successors and assigns of the Corporation.
Neither this Agreement nor any rights hereunder shall be
assignable by Executive and any such purported assignment by him
shall be void.
ARTICLE VIII
ARBITRATION
8.01 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
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of the American Arbitration Association and Section 11.01 hereof,
and judgment upon 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 the Corporation. The prevailing
party in any such arbitration shall be entitled to receive
attorney's fees and costs.
ARTICLE IX
AGREEMENT ENTIRE
9.01 This Agreement constitutes the entire
understanding between Interpublic and Executive concerning his
employment by Interpublic or any of its affiliates or
subsidiaries and supersedes any and all previous agreements
between Executive and Interpublic or any of its affiliates or
subsidiaries concerning such employment. This Agreement may not
be changed orally.
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ARTICLE X
APPLICABLE LAW
10.01 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:XXXXXX X. XXXXX, XX.
XXXXXX X. XXXXX, XX.
XXXXXX X. XXXXX
XXXXXX X. XXXXX
