Attached files
file | filename |
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8-K - INTERPUBLIC GROUP OF COMPANIES, INC. | ipg8k_0311.htm |
Exhibit
10.1
AGREEMENT REGARDING
RETIREMENT
AGREEMENT effective as of
April 1, 2010 (the “Effective
Date”), between THE INTERPUBLIC GROUP OF COMPANIES, INC. (“Interpublic”) and JOHN J.
DOONER (“Executive”).
WITNESSETH:
WHEREAS, Interpublic and
Executive are parties to an Employment Agreement made as of January 1, 1994, and
amended by Supplemental Agreements made as of July 1, 1995, September 1, 1997,
January 1, 1999, April 1, 2000, November 7, 2002, March 31, 2003, and November
12, 2003 (collectively, the “Employment Agreement”); and
WHEREAS, Paragraph 4.02 of the
Employment Agreement provides that Executive may at any time give written notice
to Interpublic specifying a termination date not less than 12 months after the
date on which such notice is given, and Paragraph 4.03 of the Employment
Agreement requires that Executive continue to perform his duties thereunder
until his termination date at his salary in effect on the date that notice of
such termination is given; and
WHEREAS, Executive intends to
retire, effective March 31, 2011; and
WHEREAS, Executive and
Interpublic wish to set forth the terms of his employment for the period from
April 1, 2010 through March 31, 2011;
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 Employment Agreement are
hereby incorporated herein by reference and shall remain in full force and
effect except to the extent such provisions are expressly modified by this
Agreement.
2. Service as Chairman and
Subsequent Transition. In accordance with Paragraph 4.03 of
the Employment Agreement, Executive shall continue to be employed and provide
services thereunder until March 31, 2011, at his salary in effect on the date
hereof; provided, however, that his duties shall be modified as
follows:
a. Effective
as of the close of business March 31, 2010, Executive shall cease to be the
Chief Executive Officer of the McCann Worldgroup (“McCann”). From
April 1, 2010 through December 31, 2010, Executive shall serve as Executive
Chairman of McCann.
b. Effective
as of the close of business December 31, 2010, Executive shall cease to be the
Executive Chairman of McCann. From January 1, 2011 through March 31,
2011, Executive shall continue to assist Interpublic and McCann in the
transition of leadership responsibilities to McCann’s new leadership team and
shall be available to perform such additional duties as Interpublic or McCann
may from time to time assign to him. The parties anticipate that
during this period, Executive will not be working for Interpublic or McCann on a
full-time basis, but that the level of services that he performs will be more
than 20 percent of the average level of services that he performed over the
immediately preceding 36 months.
If
Executive is requested to provide any services to McCann or Interpublic after
March 31, 2011, the parties shall negotiate in good faith to establish mutually
acceptable terms of engagement.
3. Retention and Retirement
Payments. In consideration of the contributions that he has
made over a long career with McCann and Interpublic, and Executive’s commitment
to ensure that the transition to new leadership at McCann is successful,
Executive shall be eligible to receive the following compensation and benefits,
subject to the approval of the Compensation Committee of Interpublic’s Board of
Directors, and provided that he remains employed by McCann or Interpublic, and
performs the duties required hereunder, through the earlier of (i) March
31, 2011, or (ii) the scheduled payment date:
a. Executive
shall be eligible to receive an award pursuant to the Executive Incentive Plan
(“EIP”) for calendar
year 2010. Such award shall be paid on or before March 15,
2011. Executive shall not be eligible for an EIP award for calendar
year 2011.
b. Effective
March 31, 2011, Executive shall vest in all then-outstanding Interpublic stock
options. Each option shall be exercisable until the earlier of
(a) March 31, 2014, or (b) the tenth anniversary of the grant
date.
c. Effective
March 31, 2011, the restrictions on all Restricted Stock previously granted to
Executive shall be lifted.
d. Subject
to achievement of the applicable performance criteria, Executive shall be
entitled to receive shares or cash in settlement of Executive’s 2008 Performance
Share Award, granted under the Interpublic Group of Companies, Inc. 2006
Performance Incentive Plan (the “PIP”). Such shares
or cash shall be delivered to Executive on March 31, 2011.
e. Effective
March 31, 2011, Executive shall vest in his 2009 Performance Cash Award, granted
under the PIP. The amount payable under such 2009 Performance Cash
Award shall be determined based on 2009 and 2010 performance, with a performance
rating for 2011 of 0%. By way of example, if Executive’s performance
ratings for 2009 and 2010 are at target, the amount payable under the 2009
Performance Cash Award would be equal to two-thirds (2/3) of the target
amount. The cash (if any) payable under the 2009 Performance Cash
Award shall be paid within 60 days after March 31, 2011.
f. Executive’s
coverage elected under Interpublic’s benefit plans shall end on March 31, 2011,
unless Employee chooses to extend such coverage as allowed by
COBRA. Thereafter, Executive shall be eligible to continue
participation in the Executive Medical Plus Plan (“EMPP”) until the end of the
“maximum required period” of continuation coverage under Section 602(2)(A) of
the Employee Retirement Income Security Act of 1974, as amended (the “COBRA Period”), which
Executive and Interpublic anticipate will be September 30,
2012. Following the end of the COBRA Period, Executive shall be
eligible to participate in Interpublic’s Retiree Medical Plan. Executive’s
coverage under the plans described in this Paragraph 3.f shall be contingent on
Executive paying (I) the full COBRA premiums for such continued coverage
during the COBRA Period and (II) the applicable contribution under the
Retiree Medical Plan for the period after the COBRA period.
g. Because
Executive is a “specified employee” (within the meaning of Treas. Reg.
§ 1.409A-1(i)), payments under the Executive Special Benefit Agreements
(“ESBAs”) between
Executive and Interpublic shall begin in the seventh month that starts after
Executive’s separation from service, in accordance with the terms of the
ESBAs. Based on Executive’s scheduled separation date of March 31,
2011, Executive and Interpublic anticipate that payments will start in October
2011.
h. Executive
shall be entitled to benefits under the Interpublic Retirement Account Plan, the
Interpublic Savings Plan, and the special deferred compensation arrangement
described in the “Nonqualified Deferred Compensation Arrangements” section of
Interpublic’s definitive proxy statement filed on April 30,
2009. Such benefits shall be calculated and paid in accordance with
the applicable plan documents. No provision of this Agreement shall
be construed to enhance or diminish Executive’s rights under the plans
referenced in this Paragraph 3.h.
i. After
March 31, 2011, Interpublic shall have no further obligation to make premium
payments towards Executive’s individual term life insurance policy.
All
payments under this Agreement shall be subject to applicable tax withholdings,
as determined by Interpublic. In addition, Executive shall be solely
responsible for paying all required taxes on all payments and other compensation
(including imputed compensation) and benefits provided under this Agreement,
without regard to whether taxes are withheld or the amount
withheld.
4. Entire
Agreement. This Agreement sets forth the entire understanding
between McCann, Interpublic, and Executive concerning Executive’s
retirement. Executive shall not be entitled to any compensation,
benefits, or other remuneration that is not described in Paragraph 2 or 3,
above.
5. Section
409A. This Agreement shall be construed, administered, and
interpreted in accordance with the requirements of Section 409A. If
Interpublic or Executive determines that any provision of this Agreement is or
might be inconsistent with the requirements of Section 409A, the parties shall
attempt in good faith to agree on such amendments as may be necessary or
appropriate to avoid causing Executive to incur adverse tax consequences under
Section 409A. 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 or any of its
affiliates.
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.
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Executive
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BY: /s/ Timothy
Sompolski
Timothy Sompolski Executive
Vice
President
Chief Human Resources Officer |
/s/ John J.
Dooner
John
J. Dooner
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DATE: 3/8/10
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DATE: 3/1/10
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