Exhibit 10(iii)(A)(1)
(INTER PUBLIC GROUP LOGO) [y41297y4129703.gif]
 
 
THE INTERPUBLIC SENIOR EXECUTIVE
RETIREMENT INCOME PLAN
 
 
Amended and Restated
Effective January 1, 2007

 

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Senior Executive Retirement Income Plan

 
Table of Contents

         
Introduction and Plan Highlights
    1  
 
       
Eligibility and Effective Date of Participation Agreement
    2  
 
       
Your Benefit
    3  
Benefit Increases
    3  
Rehire
    3  
 
       
Vesting
    3  
General Rule
    3  
Vesting of Benefit Increases
    4  
Forfeiture
    5  
 
       
Payments Under the Plan
    6  
When Payments Start
    6  
Reduction for Starting Payments Before Age 60
    6  
Form of Payment
    6  
 
       
Disability
    7  
 
       
Death Benefits
    7  
Amount, Form, and Time of Death Benefit
    7  
Designating Your Beneficiary
    8  
 
       
Change of Control
    8  
Special Vesting and Payment Rules
    8  
Deferred Compensation Trust
    10  
Reduction of Benefits After a Change of Control
    10  
 
       
Miscellaneous
    11  
Plan Administration and Review of Decisions
    11  
Participation Agreement, Amendment, and Termination
    11  
Successors to Interpublic
    12  
Coordination with Other Benefits
    12  
Nature of Your Plan Benefit and Plan Assets
    12  
Assignment and Alienation
    13  
Withholding and Other Tax Consequences
    13  
Authority to Determine Payment Date
    13  
Compliance with Tax Code § 409A
    13  
Mailing Address
    13  
Overpayments
    14  
Incapacity and Minor Status
    14  
Continued Employment
    14  
Liability Limited
    14  
Titles and Headings Not to Control
    14  
Severability
    14  
Variations in Plan Terms
    15  

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Senior Executive Retirement Income Plan

 

         
Complete Statement of the Plan
    15  
 
       
Claims and Appeals
    15  
Initial Claims
    15  
Appeals
    16  
Other Rules and Rights Regarding Claims and Appeals
    17  
 
       
Glossary of Key Terms
    18  

As required by Treasury Department Circular 230, we inform you that (1) any
statement regarding federal tax law contained in this pamphlet is not intended
or written to be used, and cannot be used, for the purpose of avoiding penalties
that may be imposed on you by the Internal Revenue Service, (2) any such
statement was written to support the promotion or marketing of the Plan, and
(3) you should seek tax advice based on your individual circumstances from an
independent tax advisor.

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Senior Executive Retirement Income Plan

 
Introduction and Plan Highlights
This pamphlet sets forth the basic terms of The Interpublic Senior Executive
Retirement Income Plan, as amended and restated effective January 1, 2007.
Capitalized terms used in this pamphlet are defined in the Glossary of Key
Terms, at the end of the pamphlet.
The Plan is sponsored by Interpublic and has been in effect since August 2003.
Your rights and responsibilities under the Plan are also governed by your
Participation Agreement with Interpublic. Your Participation Agreement
incorporates this pamphlet by reference—which means that this pamphlet is part
of your Participation Agreement.
The Plan is unfunded and is designed primarily to provide deferred compensation
for a select group of senior management employees of Interpublic and its
Subsidiaries. The Plan is excepted from most of the requirements of ERISA.
The benefits provided under the Plan are offered to secure your goodwill,
loyalty, and achievement, as well as to attract and retain other executives of
outstanding competence. The Plan does not, however, give you the right to
continue in the employ of Interpublic or its Subsidiaries, or to receive annual
compensation of any particular amount.
Key features of the Plan include the following:

  •   Eligibility to participate in the Plan must be approved by the
Compensation Committee. (See “Eligibility and Effective Date of Participation
Agreement.”)     •   The amount of your benefit under the Plan, expressed as an
annual benefit starting at age 60 and continuing for 15 years, is set forth in
your Participation Agreement. (See “Your Benefit.”) However, your Participation
Agreement may provide for payment for 10 years, and special rules apply after a
Change of Control. (See “Form of Payment” and “Change of Control.”)     •   You
may forfeit (or lose) any part of your benefit under the Plan that is not vested
when you terminate employment. Subject to special rules that apply after a
Change of Control, your benefit under the Plan generally vests over ten years,
and any increase in your benefit generally vests over seven years from the
effective date of the increase. However, even after your benefit becomes vested,
you will forfeit your benefit if you violate the non-competition or
non-solicitation provisions of your Participation Agreement. (See “Vesting.”)  
  •   In general, Interpublic will begin to pay your vested benefit under the
Plan during the first month that starts on or after the later of (1) the second
anniversary of your Termination of Employment or (2) your 55th birthday. If
payments start before you reach age 60, the amount of your monthly benefit will
be reduced by 5% for each year by which your age is less than 60 when payments
start. (See “When Payments Start.”)

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      Special rules apply (a) if you die before payments start and (b) in the
event of a Change of Control. (See “Death Benefits” and “Change of Control.”)  
  •   The Plan is not funded. This means that the promise to pay benefits under
the Plan is not backed up by a trust fund or by any other dedicated assets and
that, as a Plan participant, you are a general unsecured creditor of
Interpublic. Although special rules apply in the event of a Change of Control,
those rules do not change your status as a general unsecured creditor. (See
“Change of Control” and “Nature of Your Plan Benefit and Plan Assets.”)     •  
Your benefits under the Plan are in addition to, and independent of, any
benefits to which you may be entitled under other benefit plans sponsored by
Interpublic.

Eligibility and Effective Date of Participation Agreement
The Plan is designed to benefit the most senior U.S.-based management of
Interpublic and its Subsidiaries. You are eligible to participate in the Plan
only if your participation is approved by the Compensation Committee.
If you are eligible to participate in the Plan, you will become a participant
after you execute your Participation Agreement. Your Participation Agreement and
any amendment to your Participation Agreement will become effective on the date
prescribed below:

  •   If you have not participated in the Plan or any other Executive Defined
Benefit Arrangement:

  Ø   If you return your signed Participation Agreement to Interpublic within
30 days after your participation in the Plan is approved by the Compensation
Committee, your participation will be effective as of the first day of the first
month that starts after you return your signed Participation Agreement.     Ø  
If you return your signed Participation Agreement to Interpublic more than 30
days after your participation in the Plan is approved by the Compensation
Committee, your participation will be effective as of January 1st of the first
calendar year that starts after you return your signed Participation Agreement.

  •   If you have participated in the Plan or any other Executive Defined
Benefit Arrangement, your Participation Agreement (or any amendment to your
Participation Agreement) will be effective as of January 1st of the first
calendar year that starts after you return your signed Participation Agreement
(or amendment) to Interpublic. For example, if you have participated in the Plan
since 2005, you are informed on August 15, 2008, that you are eligible to
receive a benefit increase, and you sign and return an amended Participation
Agreement on August 27, 2008, the effective date for the benefit increase will
be January 1, 2009.

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Your Benefit
Your benefit under the Plan is expressed as an annual benefit, payable for
15 years starting at age 60 or older. Your Participation Agreement sets forth
the benefit amount. However, as explained under “Reduction for Starting Payments
Before Age 60,” below, the amount of your annual benefit will be reduced if
payment starts before you reach age 60.
Your annual benefit is subject to forfeiture until it becomes fully vested. The
vesting rules are described under “Vesting,” below. Also, special rules apply
after a Change of Control. (See “Change of Control,” below.)
Benefit Increases
The amount of your benefit may be increased from time to time. Any increase in
your benefit will be set forth in an amendment to your Participation Agreement
or in a new Participation Agreement.
Any increase in your benefit will be prospective and will be subject to special
vesting rules (described under “Vesting,” below). If it becomes fully vested,
your annual benefit under the Plan will be the sum of —

  •   the benefit stated in your initial Participation Agreement; plus     •  
each subsequent increase.

Each benefit increase vests separately. For more information, see “Vesting,”
below.
Rehire
If you leave Interpublic and its Subsidiaries, and later return to a senior
management position that is approved for participation in the Plan, you will be
treated as a new hire. You will not receive credit for your prior participation
in the Plan.
Vesting
General Rule
You will forfeit (or lose) any portion of your benefit that is not vested upon
your Termination of Employment (determined as if you continued working through
your Severance Completion Date). In general, your benefit under the Plan will
begin to vest after you participate in the Plan for three years, and will become
fully vested after you have participated in the Plan for ten years. However,
special rules apply after a Change of Control. (See “Change of Control,” below.)

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In general, benefits under the Plan will vest according to the following
schedule:

          Years of Participation Since     Effective Date of First   Portion of
Benefit Participation Agreement   that is Vested
Fewer than 3
    0 %
At least 3, but fewer than 4
    30 %
At least 4, but fewer than 5
    40 %
At least 5, but fewer than 6
    50 %
At least 6, but fewer than 7
    60 %
At least 7, but fewer than 8
    70 %
At least 8, but fewer than 9
    80 %
At least 9, but fewer than 10
    90 %
10 or more
    100 %

  •   If you had an ESBA, up to three years of participation in your ESBA will
count as years of participation in the Plan.     •   If (a) your employment with
Interpublic and its Subsidiaries is terminated involuntarily without Cause or
(b) you resign from employment with Interpublic and its Subsidiaries for Good
Reason, the vested portion of your benefit will be the portion that would have
become vested if you had continued working for Interpublic through your
Severance Completion Date.

Vesting of Benefit Increases
If your benefit is increased (as described above), the change in your benefit
(the increase) will generally vest over seven years after the effective date of
the increase. Subject to special rules that apply after a Change of Control,
each increase in your benefit will vest according to the following schedule:

          Years of Participation Since   Vested Portion Effective Date of
Increase   of Increase
At least 1, but fewer than 2
    10 %
At least 2, but fewer than 3
    20 %
At least 3, but fewer than 4
    30 %
At least 4, but fewer than 5
    40 %
At least 5, but fewer than 6
    50 %
At least 6, but fewer than 7
    75 %
7 or more
    100 %

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  •   Vesting of each increase in your benefit begins on January 1st of the
first calendar year that starts after you return your signed amendment or new
Participation Agreement to Interpublic. Participation in an ESBA and prior
participation in the Plan do not count toward the vesting of any benefit
increase.     •   If (a) your employment with Interpublic and its Subsidiaries
is terminated involuntarily without Cause or (b) you resign from employment with
Interpublic and its Subsidiaries for Good Reason, the vested portion of your
benefit increase will be the portion that would have become vested if you had
continued working for Interpublic through your Severance Completion Date.

EXAMPLE. Suppose you sign a Participation Agreement, effective September 1,
2007, specifying an annual benefit of $275,000. On September 1, 2010, you sign a
new Participation Agreement, increasing your annual benefit by $20,000 (to
$295,000), and return the signed amendment to Interpublic. On September 30,
2015, Interpublic terminates your employment without Cause, and you are eligible
to receive Severance Pay in installments for 12 months after your Termination of
Employment. The amount of your annual vested benefit (if paid for 15 years,
starting at age 60) would be $257,500 per year, calculated as follows:

•   Your Severance Completion Date would be on or about September 30, 2016.
Accordingly, the vested portion of your benefit and benefit increase will be the
portion that would have become vested if you had continued working for
Interpublic through September 30, 2016.   •   As of September 30, 2016, you
would have participated in the Plan for more than 9 years but less than
10 years. So your benefit under your original Participation Agreement would be
90% vested. The annual vested benefit would be $247,500 (90% or $275,000).   •  
The benefit increase from your September 1, 2010, Participation Agreement would
be effective January 1, 2011. As of September 30, 2016, you would have
participated in the Plan for more than 5 years, but less than 6 years, since the
increase became effective. So the increase would be 50% vested. The annual
vested benefit would be $10,000 (50% of $20,000).   •   Your total annual vested
benefit would be $257,500 ($247,500 + $10,000) per year.

The amount of your benefit will be reduced if payments start before you reach
age 60. Also, if your Participation Agreement provides for payment in
installments for 10 years (rather than 15 years), the amount of your vested
benefit will be adjusted accordingly. (See “Reduction for Starting Payments
Before Age 60” and “Form of Payment,” below.)
Forfeiture
You will forfeit any portion of your benefit that is not vested upon your
Termination of Employment (determined as if you had continued working for
Interpublic through your Severance Completion Date). Any unvested benefit and
years of participation that accrued before your Termination of Employment will
not be reinstated, even if you are rehired. In addition, you will forfeit your
vested benefit if you violate the non-competition or non-solicitation provisions
of your Participation Agreement.

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Payments Under the Plan
When Payments Start
Subject to special rules that apply after a Change of Control (see “Change of
Control,” below), Interpublic will start paying your vested benefit during the
first month that starts on or after the later of —

  •   the second anniversary of your Termination of Employment or     •   your
55th birthday.

For example, if your employment with Interpublic and its Subsidiaries terminates
on June 15, 2015, at age 56, Interpublic would make the first payment in
July 2017.
Reduction for Starting Payments Before Age 60
If Interpublic starts paying your vested benefit before you reach age 60, your
vested benefit will be reduced by 5/12% for each full calendar month (5% per
year) by which the date as of which payments start precedes your 60th birthday.
For purposes of this rule, the date as of which payments start is the first day
of the month in which the first payment is due.

EXAMPLE. Suppose you terminate employment with Interpublic and its Subsidiaries
on June 19, 2010, your 57th birthday, and your annual vested benefit, payable
for 15 years, is $175,000 per year. Assuming you comply with the non-competition
and non-solicitation provisions of your Participation Agreement, Interpublic
would start paying your benefit in July 2012, as of July 1, 2012, which is 11
full months before your 60th birthday. Accordingly, your vested benefit would be
reduced by 4.5833% (5/12% per month times 11 months).

             
Amount of Reduction:
  4.5833% of $175,000   =   $8,020.83
Annual Benefit After Reduction:
  $175,000 – $8,020.83   =   $166,979.17
Monthly Benefit After Reduction:
  $166,979.17/12   =   $13,914.93

If your Participation Agreement provides for payment in installments for
10 years, the amount of your vested benefit will be adjusted accordingly. (See
“Form of Payment,” below.)
Form of Payment
Subject to special rules that apply after a Change of Control (see “Change of
Control,” below), the vested portion of your benefit under the Plan will be paid
in one of the following forms, as set forth in your Participation Agreement:

  •   Monthly installments for 15 years or     •   Monthly installments for
10 years.

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If you receive your benefit in installments for 10 years, your annual vested
benefit will generally be larger than if you receive your benefit in
installments for 15 years, but the total amount of your vested benefit will be
discounted to reflect the value of accelerating payment. The amount of the
discount will be calculated using the Plan Interest Rate.
The amount of each monthly installment will be 1/12th of your vested annual
benefit.

EXAMPLE. Suppose your Participation Agreement provides that, if vested and paid
in monthly installments starting on or after your 60th birthday, your annual
benefit would be $150,000 per year (or $12,500 per month), and that the benefit
will be distributed in monthly payments for 10 years. If the Plan Interest Rate
is 5%, the amount of each monthly payment would be $16,481.30, calculated as
follows:

•   Based on the interest rate of 5% per year, the present value of $12,500 per
month for 15 years would be $1,675,311.16.   •   The amount of the monthly
payment for 10 years that results in a present value of $1,675,311.16 would be
$16,481.30 per month.

[Example to be reviewed by Aon.]
After you return your executed Participation Agreement, the Plan does not allow
you to change the form in which your vested benefit will be paid.
Disability
If you become disabled while employed, you will continue to accumulate years of
Plan participation until your Termination of Employment. Payments will start
after your Termination of Employment in accordance with the payment timing rules
described in this pamphlet. (See “Payments Under the Plan,” above.)
The date of your Termination of Employment will be determined in accordance with
the Plan’s definition of “Termination of Employment.”
Death Benefits
Amount, Form, and Time of Death Benefit
If you die before your vested benefit is paid in full, a beneficiary (or
beneficiaries) whom you select will be entitled to receive the remainder (if
any) of your vested benefit in a lump sum. The amount of the lump-sum payment
will be the present value of the portion of your vested benefit

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that has not yet been paid, determined using the Plan Interest Rate. Interpublic
will pay the lump sum within 90 days after your death.
Designating Your Beneficiary
You may designate one or more primary beneficiaries to receive any unpaid
portion of your vested benefit after your death. You may also designate one or
more contingent beneficiaries, who would receive any remaining payments if all
of your primary beneficiaries die before all payments have been made. You may
change your beneficiaries at any time before your death by filing a new
beneficiary designation form with Interpublic’s Human Resources Department.
If you are married on the date of your death, your beneficiary will be your
spouse, unless you specify a different beneficiary. You may not designate a
beneficiary other than your spouse, however, without your spouse’s written
consent.
In the absence of an effective beneficiary designation (or if none of your
primary or contingent beneficiaries are living), the remainder of the vested
portion of your benefit (if any) will be distributed, in the form set forth
above, to the first of the following to survive you:

  •   Your spouse;     •   Your children (to be divided equally);     •   Your
parents;     •   Your brothers and sisters (to be divided equally); or     •  
The executors or administrators of your will.

The form for making your initial beneficiary designation is attached to your
Participation Agreement. You may obtain new beneficiary designation forms from
Interpublic’s Human Resources Department.
Change of Control
Special Vesting and Payment Rules
The Plan has special rules that apply if your employment with Interpublic and
its Subsidiaries terminates within two years after Change of Control.
Special Vesting Rule
The Plan’s special vesting rule applies only if:

  •   As of December 31st of the year in which the Change of Control occurs:

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  Ø   You will be age 55 or older and     Ø   Your benefit under the Plan will
be within two years of full vesting (i.e., your benefit will become fully vested
by December 31st of the second calendar year that starts after the Change of
Control), and

  •   Within two years after a Change of Control, (a) your employment with
Interpublic and its Subsidiaries is terminated involuntarily without Cause or
(b) you resign from employment with Interpublic and its Subsidiaries for Good
Reason.

If you meet the conditions described above, then upon your Termination of
Employment, your benefit under the Plan will immediately be fully vested.
If you do not meet both of the conditions above, but (a) your employment is
terminated involuntarily without Cause or (b) you resign for Good Reason, the
vested portion of your benefit under the Plan will be the portion of your
benefit that would have become vested if you had continued working for
Interpublic through your Severance Completion Date.
Special Payment Rules
After a Change of Control, the time and form in which your benefit will be paid
(regardless of the reason for your Termination of Employment) will depend on
when your Termination of Employment occurs, as follows:

                If Your Termination of Employment     If Your Termination of
Employment     Occurs On or Before the Second     Occurs After the Second
Anniversary     Anniversary of the Change of Control     of the Change of
Control    
Subject to the “Delay of Payment to Top-50 Employees” (described below),
Interpublic will pay your unreduced (age 60) benefit in a lump sum within
30 days after your Termination of Employment.
    Interpublic will pay your unreduced (age 60) benefit at the time and in the
form set forth in your Participation Agreement.    

If your benefit is paid in a lump sum (because your Termination of Employment
occurs within two years after the Change of Control), the amount of the lump sum
will be determined as follows:

  •   If your benefit under the Plan is fully vested (including vesting under
the special vesting rule described above), the amount of the lump-sum payment
will be the then-present value of your unreduced benefit, if paid in monthly
installments over 15 years, starting on the first day of the first month that
starts on or after the later of (a) the second anniversary of your Termination
of Employment or (b) your 60th birthday.     •   If your benefit under the Plan
is not fully vested, the amount of the lump-sum payment will be the then-present
value of the vested portion of your benefit if paid in monthly installments over
15 years, starting on the first day of the first month that starts on or after

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      the later of (a) the second anniversary of your Termination of Employment
or (b) your 55th birthday.

The interest rate for this calculation will be the Plan Interest Rate.
Delay of Payment to Top-50 Employees
If Interpublic determines that you are a Top-50 Employee, payment of your vested
benefit will be delayed until the earlier of (a) the first day of the seventh
month that starts after your Termination of Employment or (b) the first day of
the first month that starts after your death (the “Delayed Payment Date”). Any
amount that was scheduled to be paid to you before the Delayed Payment Date will
be paid to you on the Delayed Payment Date. (If no payments are scheduled to be
made until after the Delayed Payment Date, this paragraph will not apply.)
Deferred Compensation Trust
Before a Change of Control, Interpublic must contribute to a Deferred
Compensation Trust an amount equal to the then-present value of the sum of all
benefits that would become payable under the Plan if Interpublic terminated all
participants’ employment without Cause immediately after the Change of Control.
The amount to be contributed will be determined by an Outside Auditor engaged by
Interpublic at Interpublic’s expense.
For purposes of calculating the amount to be contributed to a Deferred
Compensation Trust, the Outside Auditor will make the following assumptions:

  •   The assumed annual rate of interest and discount rate will be the rate of
interest to be credited to accounts (as described under “Your Benefit,” above)
for the year in which the Change of Control occurs, and     •   Payment of the
benefits described above will be due within 30 days after the Change of Control.

Assets that Interpublic or any Subsidiary contributes to the Deferred
Compensation Trust are subject to the claims of the creditors of Interpublic or
the Subsidiary (as the case may be) in the event of its bankruptcy or
insolvency. The Deferred Compensation Trust will not change your status as a
general unsecured creditor of Interpublic.
Reduction of Benefits After a Change of Control
It is possible that some or all of the benefit you receive after a Change of
Control will be treated as an “excess parachute payment” that is subject to a
20% excise tax under Section 4999 of the Tax Code. If an Outside Auditor
determines that any amount payable to you under the Plan is reasonably likely to
trigger the 20% excise tax, your benefit under the Plan will be whichever of the
following amounts results in a larger net benefit to you, after taxes (as
determined by the Outside Auditor):

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  •   Your full benefit under the Plan, all or part of which might be subject to
a 20% excise tax, or     •   Your benefit under the Plan, reduced to the extent
the Outside Auditor determines is necessary to avoid triggering the 20% excise
tax.

Interpublic will engage and pay the fees for the Outside Auditor to perform
these calculations.
Miscellaneous
Plan Administration and Review of Decisions
The Plan’s administrator is the MHRC. Before a Change of Control, the Plan’s
administrator has complete and exclusive discretionary authority and
responsibility to administer and interpret the Plan’s governing documents
(including the authority to make findings of fact and to resolve ambiguities and
inconsistencies in the Plan’s language, and to correct any inadvertent
omissions). All decisions of the Plan’s administrator are considered to be final
and controlling. Review by a court of any decision of the Plan’s administrator
will be subject to the following standard of review:

  •   Before a Change of Control, the standard of review will be the “arbitrary
and capricious” standard, which means that the court will defer to the MHRC’s
decision (or the decision of any successor to the MHRC), and will not overturn
that decision unless the court concludes that the decision cannot be supported
by the relevant facts and applicable law.     •   After a Change of Control, the
standard of review will be “de novo,” which means that the court may overturn
the MHRC’s decision (or the decision of any successor to the MHRC) if it
disagrees with the decision.

The MHRC has authority to delegate any of its duties and responsibilities under
the Plan as it deems appropriate. In addition, the MHRC may engage one or more
persons to render advice with regard to any of its administration
responsibilities. Any final decision by a delegate of the MHRC will be treated
for purposes of the Plan as a decision of the MHRC.
Participation Agreement, Amendment, and Termination
Your Participation Agreement sets forth specific terms relating to your benefit
under the Plan. Your Participation Agreement, including any amendment to your
Participation Agreement, is valid only if it is executed on behalf of
Interpublic by Interpublic’s Executive Vice President, Chief Human Resources
Officer or his designee.
Although Interpublic intends to continue the Plan indefinitely, Interpublic
reserves the right to amend or terminate the Plan at any time, and from time to
time, either retroactively or prospectively, without your consent. However,
unless necessitated by a change in applicable law, an amendment or termination
may not —

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  •   reduce the amount of your vested benefit as of the later of (a) the
effective date of the amendment or termination or (b) the date the resolution to
amend or terminate the Plan is adopted; or     •   result in a change to the
form or time for paying your benefit under the Plan, unless Interpublic
determines, based on the advice of outside counsel, that a change in the form or
time of payment will not trigger adverse tax consequences.

In addition, any resolution to amend or terminate the Plan that is adopted or
becomes effective during the three years following a Change of Control may not
take away any of your rights, or relieve Interpublic of any of its obligations
under the Plan, including those set forth in the section entitled “Change of
Control,” above.
Subject to the restrictions set forth above, any amendment or termination of the
Plan may be adopted by resolution of the Compensation Committee. In addition,
the MHRC —

  •   may make any amendment required to comply with federal or state law
(including any tax law that could result in adverse tax consequences), or that
is desirable to improve the administration of the Plan, if the amendment does
not materially affect the level of benefits provided under the Plan to or on
behalf of any participant; and     •   has discretion to accelerate payment to
the extent that Interpublic or the MHRC determines, with the advice of outside
counsel, is permitted without violating the requirements of Section 409A of the
Tax Code.

Successors to Interpublic
Interpublic shall require any successor to its business or its assets to assume
the Plan expressly, absolutely, and unconditionally, and to administer the Plan
in accordance with its terms. After a Change of Control, all references to
Interpublic and its Subsidiaries shall be deemed to refer to Interpublic’s
successor and its Subsidiaries.
Coordination with Other Benefits
Your benefit under the Plan is designed to be in addition to any benefits you
earn under other benefit plans sponsored by Interpublic and its Subsidiaries.
Except as expressly provided in another plan or in this Plan, your right to a
benefit under the Plan will not affect the benefits under any other plan.
Nature of Your Plan Benefit and Plan Assets
The obligation to pay your vested benefit under the Plan is a liability of
Interpublic. Benefits under the Plan are not insured by the Pension Benefit
Guaranty Corporation, and any assets that Interpublic or a Subsidiary sets aside
to fund your vested benefit under the Plan, whether in a Deferred Compensation
Trust or otherwise, will remain available to creditors of Interpublic or the
Subsidiary (as the case may be) in the event of its bankruptcy or insolvency.

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Assignment and Alienation
In general, your right to a benefit under the Plan (and the corresponding rights
of your beneficiaries) may not be assigned, transferred, alienated, encumbered,
or otherwise subject to lien. However, the Plan will comply with domestic
relations orders that are determined to be “qualified domestic relations orders”
under ERISA.
Withholding and Other Tax Consequences
Interpublic may deduct from amounts paid or due to a participant under the Plan
any income, employment, excise and other taxes that it reasonably determines are
required to be withheld by any government or government agency, including any
taxes on income that is currently subject to tax even though it is not currently
paid or payable to you. You (or your beneficiaries) are responsible for
satisfying any remaining tax obligations, to the extent that amounts withheld
(if any) are insufficient.
Authority to Determine Payment Date
To the extent that any payment under the Plan 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
any participant, beneficiary, or other individual.
Compliance with Tax Code § 409A
Your benefit under the Plan is subject to Section 409A of the Tax Code, which
became effective January 1, 2005, and imposes restrictions on deferred
compensation arrangements like the Plan. Interpublic intends to operate,
administer, and interpret the Plan in accordance with Section 409A. If the
Compensation Committee or the MHRC determines in good faith that (a) any aspect
of the Plan is inconsistent with the restrictions imposed by Section 409A
(including guidance interpreting Section 409A) and (b) an amendment to the Plan
could reduce or eliminate adverse tax consequences under Section 409A, the
Compensation Committee or the MHRC may amend the Plan without your consent to
the extent that it determines, based on the advice of outside counsel, the
amendment is necessary to reduce or eliminate such adverse tax consequences.
Although the Plan has been subject to Section 409A since January 1, 2005, the
plan documents in effect before January 1, 2007, were not amended to reflect the
requirements of Section 409A. For the period from January 1, 2005 through
December 31, 2006, Interpublic and the MHRC have discretion to override the
terms of the Plan to the extent that either Interpublic or the MHRC determines
is necessary or appropriate to comply with the requirements of Section 409A.
Mailing Address
After you terminate employment with Interpublic and its Subsidiaries, you will
receive periodic correspondence related to your benefit (if any) under the Plan.
It is your responsibility to notify

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Interpublic’s Human Resources Department of any changes in your mailing address
or in the mailing address of any of your beneficiaries (or contingent
beneficiaries). Failure to update your address could delay payment of your
vested benefit.
Overpayments
If an overpayment of benefits is made under the Plan, the amount of the
overpayment may be set off against future payments under the Plan until the
overpayment has been recovered. If no future payments are scheduled, you will be
required to return the overpaid amount, and Interpublic may pursue any legal or
equitable avenue to effectuate recovery.
Incapacity and Minor Status
If any individual entitled to a payment under the Plan is a minor, or is
physically or mentally unable to care for his or her affairs, and another person
or institution is maintaining custody over the individual entitled to receive
the payment, payments under the Plan may be made, for the benefit of the
individual entitled to payment, to the custodial person or institution, as
applicable. If a court has appointed a guardian or representative of the
individual entitled to payment, payment will be made to the guardian or
representative. Any such payment will discharge the Plan’s liability, as if the
payment were made to the individual entitled to payment.
Continued Employment
Nothing in the Plan gives you the right to continue in the employment or service
of Interpublic or its Subsidiaries, or to receive annual compensation in any
particular amount. Conversely, nothing in the Plan gives Interpublic or any
Subsidiary the right to require you to remain in its employ.
Liability Limited
Except as and to the extent otherwise provided by applicable law, no liability
will attach to or be incurred by the shareholders, directors, officers, or
employees of Interpublic and its Subsidiaries under or by reason of any of the
terms and conditions of the Plan.
Titles and Headings Not to Control
The titles and headings of sections of the Plan are for convenience of reference
only. In the event of any conflict, the text of the Plan, rather than the titles
or headings, will control.
Severability
If any provision of the Plan is held illegal or invalid for any reason, other
provisions will be unaffected. The Plan will be construed as if any illegal or
invalid provision were never inserted.

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Variations in Plan Terms
Your individual Participation Agreement may contain provisions that conflict
with or are otherwise inconsistent with the terms set forth in this plan
document. If so, the terms of your Participation Agreement will control.
Complete Statement of the Plan
This pamphlet and your Participation Agreement are a complete statement of your
rights under the Plan. Any question regarding your rights under the Plan must be
resolved by applying the terms of the Plan document and your Participation
Agreement. External evidence of intent or meaning will not be relevant.
Claims and Appeals
The Plan has specific procedures for making a claim for benefits. You must
exhaust this claim and appeal process before you can file a lawsuit in court.
The claim and appeal process has two levels: (1) the initial claim and
(2) review on appeal. They operate as follows:
Initial Claims

  1.   Any benefit claim must be in writing and should be mailed to the MHRC, at
the following address:

IPG Management Human Resources Committee
1114 Avenue of the Americas, 19th Floor
New York, NY 10036
Attn: Executive Vice President, Chief Human Resources Officer

  2.   The MHRC will generally review and decide each claim within 90 days after
the claim is received. If the MHRC needs more time to decide your claim, the
MHRC will notify you, and may extend the review period by up to an additional
90 days.

  Ø   The time period within which the MHRC must decide your claim starts on the
date the MHRC receives your claim, even if you do not submit all of the
information needed to resolve your claim. However, if the MHRC needs more
information to resolve your claim, you and the MHRC may agree to extend the
period for making the decision. If you do not provide any requested information
by the deadline that the MHRC sets, the MHRC will decide your claim based on the
information it has as of the deadline. This might result in your claim being
denied.     Ø   If your claim is not resolved within the time periods described
above, you may consider your claim to have been denied. You may (a) contact the
MHRC to

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      determine whether your claim has, in fact, been denied, (b) file an appeal
with the MHRC (following the procedures set forth in the “Appeals” section,
below), or (c) bring a lawsuit under Section 502(a) of ERISA.

  3.   If your claim is wholly or partially denied, the MHRC will issue a
written decision. The decision will include —

  Ø   the specific reason or reasons for denial of your claim;     Ø  
references to the specific Plan provisions upon which the denial is based;     Ø
  a description of any additional material or information necessary to perfect
your claim, and an explanation of why the material or information is necessary;
    Ø   an explanation of the appeal procedures and the applicable time limits;
and     Ø   a statement of your right to file a lawsuit under Section 502(a) of
ERISA if your claim is denied after the MHRC reviews its initial decision.

Appeals

  1.   Within 60 days after you receive a written notice of denial of your claim
(or the end of the time period for deciding your claim), you may file a written
request with the MHRC, at the address shown above, for a full and fair review of
its initial decision (an “appeal”).     2.   In connection with a request for
review, you may —

  Ø   submit written comments, documents, records and other information relating
to your claim; and     Ø   receive, upon request and free of charge, reasonable
access to, and copies of, all documents, records and other information that the
MHRC determines is relevant to your claim.

  3.   The review on appeal will take into account all comments, documents,
records and other information that you submit, regardless of whether the
information was considered in the initial benefit determination. The MHRC will
generally decide your appeal within 60 days after your request for review is
received. If the MHRC needs more time, the MHRC will notify you, and the MHRC
may extend the review period by up to an additional 60 days.

  Ø   If the MHRC needs more information to decide your appeal, the period
within which the MHRC must decide your appeal will automatically be extended.
The length of the extension will be equal to the number of days from when the
MHRC sends you a request for additional information until the earlier of (a) the
date the MHRC receives the requested information or (b) the due date that the
MHRC establishes for providing that information.

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  Ø   If your appeal is not resolved within the time periods described above,
you may consider your appeal to have been denied. You may (a) contact the MHRC
to determine whether your appeal has, in fact, been denied and/or (b) bring a
lawsuit under Section 502(a) of ERISA.

  4.   If your appeal is wholly or partially denied, the MHRC will render a
written decision. The decision will include —

  Ø   the specific reason or reasons for the decision;     Ø   references to the
specific Plan provisions upon which the decision is based;     Ø   an
explanation of your right to receive, upon request and free of charge,
reasonable access to, and copies of, all documents, records, and other
information that the MHRC determines is relevant to your claim for benefits; and
    Ø   a statement of your right to bring a civil action under Section 502(a)
of ERISA.

Other Rules and Rights Regarding Claims and Appeals

  •   You may authorize a representative to pursue any claim or appeal on your
behalf. The MHRC may establish reasonable procedures for verifying that any
representative has in fact been authorized to act on your behalf.     •   The
Plan will be interpreted and enforced in accordance with the applicable
provisions of ERISA and federal tax laws that apply to nonqualified deferred
compensation. To the extent that state-law issues arise, New York law (exclusive
of choice of law provisions) will govern.

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Glossary of Key Terms

       
Cause
  Cause for your employer to terminate your employment with Interpublic and its
Subsidiaries, which will exist if —
 
   
 
  •
you materially breach a provision in an employment agreement between you and
Interpublic or a Subsidiary, and you do not cure that breach within 15 days
after you receive written notice from your employer of the breach;
 
   
 
  •
without written approval from Interpublic’s Board of Directors or the person to
whom you report directly, you (a) misappropriate funds or property of
Interpublic or a Subsidiary or (b) attempt to secure any personal profit related
to the business of Interpublic or a Subsidiary;
 
   
 
  •
you engage in conduct that Interpublic determines constitutes fraud, material
dishonesty, gross negligence, gross malfeasance, insubordination, or willful
misconduct in the performance of your duties as an employee of Interpublic or a
Subsidiary, or you willfully fail to follow Interpublic’s code of conduct,
unless your actions (or failure to act) are taken in good faith and do not cause
material harm to Interpublic or a Subsidiary;
 
   
 
  •
you refuse or fail to attempt in good faith (a) to perform your duties as an
employee of Interpublic or a Subsidiary or (b) to follow a reasonable good-faith
direction of Interpublic’s Board of Directors or the person to whom you report
directly, and you do not cure the refusal or failure within 15 days after you
receive written notice from your employer of the refusal or failure;
 
   
 
  •
you commit, or are formally charged or indicted for allegedly committing, a
felony or a crime involving dishonesty, fraud, or moral turpitude; or
 
   
 
  •
you engage in activities that are clearly prohibited by Interpublic’s policy
prohibiting discrimination or harassment based on age, gender, race, religion,
disability, national origin or any other protected category.
 
     
Change of Control
  A change in (a) the ownership or effective control of Interpublic or (b) the
ownership of a substantial portion of Interpublic’s assets, each as defined in
rules and regulations under Section 409A of the Tax Code. Subject to certain
limited exceptions, a Change of Control of Interpublic would generally occur
if —
 
   
 
  •
a person or group acquires more than 50% of the total fair market value or
voting power of Interpublic’s stock;
 
   
 
  •
during a 12-month period, a person or group acquires 30% or more of the total
voting power of Interpublic’s stock;
 
   
 
  •
during a 12-month period, a person or group acquires 40% or more of

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  Interpublic’s assets (determined based on gross fair market value); or
 
   
 
  •
during a 12-month period, a majority of Interpublic’s Board of Directors is
replaced by directors whose appointment or election is not endorsed by a
majority of the members of the Board before the appointment or election.
 
     
Compensation
Committee
  The Compensation Committee of Interpublic’s Board of Directors.
 
     
Deferred
Compensation Trust
  The Trust Agreement Between The Interpublic Group of Companies, Inc., Lintas:
Campbell-Ewald Company, McCann-Erickson USA, Inc., McCann-Erickson Marketing,
Inc., and Lintas, Inc. and Manufacturers Hanover Trust Company, originally
effective June 1, 1990 (commonly referred to as the “Interpublic Rabbi Trust”)
and/or any other trust agreement to which Interpublic is a party that is
established to fund benefits under the Plan. The terms of any Deferred
Compensation Trust are subject to the restrictions set forth in Section 409A of
the Tax Code, and assets that Interpublic or a Subsidiary sets aside in any
Deferred Compensation Trust will be subject to the claims of creditors of
Interpublic or the Subsidiary (as the case may be) in the event of its
bankruptcy or insolvency.
 
     
ERISA
  The Employee Retirement Income Security Act of 1974, as amended.
 
     
ESBA
  An Executive Special Benefit Agreement with Interpublic.
 
     
Executive Defined
Benefit Arrangement
  An arrangement sponsored by Interpublic or a Subsidiary that is treated under
Section 409A of the Tax Code as a “nonaccount balance plan.” In general, this
includes any non-tax-qualified deferred compensation arrangement under which
your benefit is not the balance credited to an account in your name. An ESBA is
another Executive Defined Benefit Arrangement.
 
     
Good Reason
  •
You will be considered to have resigned for Good Reason only if:
 
   
 
       Ø
You notify Interpublic in writing that one or more of the “triggering
circumstances” listed below has occurred within 90 days after the
circumstance(s) first occurs;
 
   
 
       Ø
The triggering circumstance(s) is (are) not remedied within 30 days after
Interpublic receives the notice; and
 
   
 
       Ø
Your Termination of Employment is effective within two years after triggering
circumstance(s) first occurs.
 
   
 
  •
The following are the “triggering circumstances”:
 
   
 
       Ø
Interpublic or a Subsidiary materially reduces your rate of base salary;
 
   
 
       Ø
An action by Interpublic or a Subsidiary results in your authority, duties, or,
responsibilities, being materially diminished;
 
   
 
       Ø
An action by Interpublic or a Subsidiary results in the authority,

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duties, or responsibilities of your supervisor being materially diminished,
including a requirement that you report to a corporate officer or employee
instead of the Board of Directors of Interpublic;
 
   
 
       Ø
Interpublic or a Subsidiary materially diminishes the budget over which you
retain authority;
 
   
 
       Ø
Your principal place of work is moved more than 50 miles outside the city in
which you are principally based, unless (a) you make the relocation decision or
(b) you are notified in writing that Interpublic or your employer is seriously
considering such a relocation and do not object in writing within 10 days after
you receive the written notice; or
 
   
 
       Ø
Interpublic or a Subsidiary materially breaches any employment agreement between
you and your employer.
 
     
Interpublic
  The Interpublic Group of Companies, Inc., and any successor to The Interpublic
Group of Companies, Inc.
 
     
MHRC
  Interpublic’s Management Human Resources Committee.
 
     
Outside Auditor
  Either of the following firms:
 
   
 
  •
The outside auditing firm retained by Interpublic in the last fiscal year that
ends before a Change of Control, or
 
   
 
  •
A national auditing firm acceptable to at least 75% of the Plan participants who
are actively working for Interpublic or a Subsidiary immediately before a Change
of Control.
 
     
Participation
Agreement
  The written agreement between you and Interpublic that documents the terms of
your participation in the Plan.
 
     
Plan
  The Interpublic Senior Executive Retirement Income Plan, as set forth in this
pamphlet and your Participation Agreement, as either or both may be amended from
time to time.
 
     
Plan Interest Rate
  The average of the 10-year and 20-year U.S. Treasury yield curve annual rates
(also known as “constant maturity rates”) as of the last business day of the
immediately preceding calendar year, as published by the U.S. Department of
Treasury’s Office of Debt Management.
 
     
Severance Completion
Date
  The last day of the calendar month that includes the end of the payroll period
for which your last Severance Payment (if any) is paid. If you are not eligible
to receive Severance Pay, or you receive Severance Pay in a lump sum, your
Severance Completion Date is the date of your Termination of Employment.
 
     
Severance Pay
  A payment or payments made under a severance plan or policy or an agreement
with Interpublic or a Subsidiary upon or after your Termination of Employment as
compensation for (a) terminating your employment involuntarily without Cause or
(b) your resignation for

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  Good Reason.
 
     
Subsidiary
  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 Tax Code. In
general, this means Interpublic and all other entities of which Interpublic
directly or indirectly owns 80 percent or more of the combined voting power or
total value of shares.
 
     
Tax Code
  The Internal Revenue Code of 1986, as amended.
 
     
Termination of Employment
  The date your employment with Interpublic and its Subsidiaries ends, including
the date on which you die, retire, quit, or are discharged. Subject to the next
sentence, if you are on leave of absence, your Termination of Employment will
occur on the later of (a) the first day that is more than six months after your
leave started or (b) the first day after all statutory and contractual rights to
reemployment with Interpublic or a Subsidiary expire. If the reason for your
leave of absence is a medically determinable physical or mental condition that
can be expected to last for six consecutive months or longer, and the condition
causes you to be unable to perform the duties of your position or a
substantially similar position, the six-month period described in clause (a) of
the preceding sentence will be extended to 29 months.
 
   
 
  A sale of assets by Interpublic or a Subsidiary to an unrelated buyer that
results in your working for the buyer (or one of its affiliates) will 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 the sale.
 
     
Top-50 Employee
  A “specified employee” under Section 409A of the Tax Code, determined in
accordance with Treas. Reg. § 1.409A-1(i). In general, as long as Interpublic is
a public company (or, if Interpublic is acquired, the parent company is a public
company), you will be a “specified employee” under Section 409A of the Tax Code
if you are one of the 50 highest-paid officers of Interpublic (or, if
Interpublic is acquired, the corporate parent) and its Subsidiaries.  

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