EX-10.III.A.



 






Exhibit 10(iii)(A)(1)







 

 




THE INTERPUBLIC SENIOR EXECUTIVE

RETIREMENT INCOME PLAN



 

 




Amended and Restated

Effective January 1, 2007




 









 





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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	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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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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