Document:

SUPPLEMENTAL AGREEMENT

 

SUPPLEMENTAL AGREEMENT made as of February 24, 2006 between THE INTERPUBLIC GROUP OF COMPANIES, INC., a Delaware corporation ("Interpublic") and STEVE GATFIELD ("Executive").

 

W I T N E S S E T H:

 

WHEREAS, Interpublic and Executive are parties to an Employment Agreement made as of February 2, 2004 (hereinafter referred to as the "Agreement"); and

WHEREAS, Interpublic and Executive desire to amend the Agreement to provide for a fixed term assignment to Lowe Worldwide;

NOW, THEREFORE, in consideration of the mutual promises herein and in the Agreement set forth, the parties hereto, intending to be legally bound, agree as follows: 

1.            Paragraph 2.01 of the Agreement will be amended by adding a new section (vi) to read as follows:  "For the period February 24, 2006 through April 15, 2009, in addition to maintaining his current title, Executive will act as Chairman, Chief Executive Officer of Lowe Worldwide, reporting to the Chief Executive Officer of Interpublic (hereinafter referred to as the "Lowe Assignment").  It is understood that the final year of the Lowe Assignment will involve the transition of Executive’s responsibilities to successor Lowe Worldwide management.  Upon completion of the Lowe Assignment, Executive and Interpublic will review other full time employment
opportunities that may be available to Executive at Interpublic or one of its operating companies.  In the event no 

 

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such opportunity is mutually agreed, Executive will be employed on a part time basis as contemplated by Section 7.06."

2.             Paragraph 3.01 of the Agreement is hereby amended, effective as of May 1, 2006 by deleting "Eight Hundred Fifty Thousand Dollars ($850,000)" therefrom and substituting "Eight Hundred Ninety-Two Thousand Five Hundred Dollars ($892,500)" therefor.

3.            Paragraph 4.01 of the Agreement will be amended by adding the following:  "For calendar year 2005, Executive’s bonus will be guaranteed at one hundred ten percent (110%) of his 2005 base salary.  For calendar year 2006, Executive’s bonus will be guaranteed at fifty percent (50%) of his 2006 salary.  For calendar years 2007 and 2008, Executive will be eligible to participate in Interpublic’s Annual Management Incentive Plan, or any successor plan, in accordance with the terms and conditions of the Plan established from time to time, and the actual award during such years shall be determined based on profits, Executive's individual performance, and management discretion.  

4.            Paragraph 4.02 of the Agreement will be amended by adding the following:  “For calendar years 2006, 2007 and 2008, and concurrent with grants to executives at a comparable level to Executive, Executive shall continue to participate in Interpublic’s long-term incentive programs, with a total annual award value of One Million Dollars ($1,000,000).  Any such long-term incentive award shall be comparable to long-term incentive awards provided to executives at a comparable level to Executive and may consist of any forms of incentive, as determined by Interpublic’s Compensation 

 

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Committee in its discretion (i.e., stock options, restricted common stock, performance shares).  In the event that Executive’s employment hereunder terminates for any reason at a time when any portion of such awarded equity remains unvested, Executive will be entitled to pro rata vesting of such equity as of Executive’s last day on the Interpublic payroll.”

5.            A new Paragraph 4.04 will be added to read as follows:  “As of the completion of the Lowe Assignment (April 15, 2009), in addition to any other bonuses payable under Paragraph 4.01, unless Executive is terminated for Cause, he will receive a special completion bonus of (i) an amount equal to one hundred fifty percent (150%) of his base salary as of April 15, 2009, plus (ii) an amount equal to the difference between (A) the sum of fifty percent (50%) of Executive’s salary as of December 31, 2007 and December 31, 2008 and (B) the total of the bonuses awarded to Executive for performance during calendar years 2007 and 2008.  If the total amount referenced in Subparagraph (ii)(B) exceeds the total referenced in Subparagraph (ii)(A), no
additional payment will be due Executive, beyond the 150% bonus referenced in Subparagraph (i).  If, prior to the completion of the Lowe assignment, Executive dies or becomes unable to perform his duties hereunder due to disability, the amounts payable hereunder shall be paid to him, or to his estate, as the case may be, at the time(s) and in the manner set forth above."

6.            A new Paragraph 5.03 will be added to read as follows:  "As soon as administratively feasible following full execution of this Supplemental Agreement, Executive will be granted fifty thousand (50,000) shares of Interpublic restricted stock.  

 

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Such stock will vest in full on the second anniversary of the date of grant (on or about February 15, 2008)."

7.            Paragraph 6.02 of the Agreement will be amended to add the following:  "Executive will be entitled to a special twelve-week paid time off period in year three of the Lowe Assignment."

8.            A new Paragraph 6.10 will be added to read as follows:  "Executive will be reimbursed for estate planning costs (incurred in connection with change of domicile issues) up to a maximum of Six Thousand Dollars ($6,000)."

9.            A new Paragraph 6.11 will be added to read as follows:  "During the Lowe Assignment, Executive will be provided with: (i) rental housing in London contracted for and paid for by Lowe (in an amount of up to Five Thousand Pounds (£5,000) per month) and payment for utilities by Lowe; (ii) lease of a car and reimbursement for a health club membership; (iii) a per diem allowance of Fifty Pounds (£50) per day for days spent in the United Kingdom (against receipt of documentation); and (iv) two (2) return business class flights per year between the United States and the United Kingdom/Europe for Executive and his family (i.e., three people plus Executive).  The benefits provided herein shall
be reported by Interpublic/Lowe to the appropriate federal and local taxing authorities as income to Executive.  For any payments made by Lowe or Interpublic directly to the appropriate vendor(s), Executive will also be paid an additional sum to offset the taxation of such benefits as income; and for any payments made by Lowe or Interpublic directly to Executive, such payment to Executive will similarly be increased to offset the taxation of such payments as income."

 

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10.          A new Paragraph 6.12 will be added to read as follows:  “In the event that Executive requires medical care while traveling during the Lowe Assignment, to the extent that any appropriate medical expenses are incurred by Executive that are not covered by Interpublic’s available insurance options on the same terms as coverage received in the United States, Interpublic will reimburse Executive for such uncovered medical costs, upon presentation of invoice.”

11.          Paragraph 7.01 of the Agreement shall be deleted and replaced in its entirety with the following:  "Interpublic may terminate the employment of Executive at any time by giving written notice of such termination to the Executive.  In the event that Interpublic terminates the employment of Executive, other than for "cause" (as defined in Paragraph 7.04), prior to April 15, 2009, then Executive shall receive the following:  (i) full payment of all salary and other payments (including guaranteed bonuses) (in accordance with regular payroll practices) contemplated by this Agreement through April 15, 2009; (ii) except as specified in Paragraphs 4.02 and 5.03, full vesting of restricted stock, stock options and performance shares (subject to the terms of
Interpublic’s Performance Incentive Plan) as of the termination date; (iii) continued vesting of Executive’s SERIP award under the SERIP Participation Agreement through April 15, 2009; (iv) continuation in all employee benefits at the levels in which Executive participated prior to the qualifying termination (except that, for any benefit program in which a terminated employee may not participate, Interpublic will make such payments to Executive as would have been made by Interpublic had Executive continued in such benefits plans (i.e., Savings Plan matching contributions); and (v) severance in an amount 

 

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equal to Two Million Dollars ($2,000,000), less applicable taxes and withholdings, payable in full accordance with the provisions of the American Jobs Creation Act of 2004 and in a manner consistent with severance payments made to other executives of Interpublic at a similar level to Executive."

12.          Paragraph 7.05(ii) of the Agreement shall be deleted and replaced in its entirety with the following:  “any relocation of the Executive’s principal business location to a location other than the New York Metropolitan area (within fifty (50) miles of Manhattan), except that Executive understands and agrees that he will be required to travel extensively during the Lowe Assignment, that he may be required to travel to locations outside the United States, and that he may be required to locate up to an average of sixty (60) days per year to the United Kingdom (as measured from April 1 to March 30 of each year during the Lowe Assignment, a “Lowe Year”) during the period covered by the Lowe Assignment, and may be required to travel up to
eighty (80) days in any given Lowe Year in the United Kingdom, or more only if Executive consents to such additional travel.”

13.          A new Paragraph 7.06 shall be added to read as follows:  "If, upon expiration of the Lowe Assignment (i.e., April 15, 2009) there are no mutually agreeable full-time opportunities for Executive within the Interpublic system, then Executive’s full-time employment with Interpublic will terminate.  Thereafter, for a period of five (5) years ("Part Time Period"), Executive will work for Interpublic on a part-time basis as an employee in the title of Executive Vice President, on the following terms:  (i) Executive will be expected to work an average of approximately two days per week 

 

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during the Part Time Period, on matters determined by Interpublic’s Chief Executive Officer or his designee, which matters shall be consistent with Executive’s title; (ii) Executive will be entitled to a pro rata allowance of ten weeks’ paid time off during the Part Time Period (to reflect an average two day per week schedule), or twenty (20) days of paid time off leave per year; and (iii) Executive will be provided with a private office and access to administrative support during the Part Time Period.  Executive will be paid a salary of Four Hundred Thousand Dollars ($400,000) per year during the Part Time Period, and he will remain eligible to participate in all Interpublic benefits in which he participated during his period of full time employment (including continued vesting of his SERIP awards and continued
vesting of equity), except that he will not be eligible for any incentive pay awards for work performed during the Part Time Period (pursuant to Article IV or otherwise).  During the Part Time Period, Executive may provide consulting (but not employment) services to other entities, except that he shall not provide services of any kind to WPP, Omnicom or Publicis or any of their respective subsidiaries or affiliates.  Upon conclusion of the Part Time Period, the parties will determine whether they wish to continue to engage in an employment relationship.  The Part Time Period can be extended only if done so in writing at least thirty (30) days prior to April 15, 2014.  Upon conclusion of the Part Time Period (or any extension thereof) Executive will not be entitled to receive severance payments of any kind, and he will be eligible for continued medical coverage through COBRA only.  Executive’s SERIP awards will continue to be governed in accordance with the terms of the SERIP
Participation Agreement."

 

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14.         Except as hereinabove amended, the Agreement shall continue in full force and effect.

15.         This Supplemental Agreement shall be governed by the laws of the State of New York, applicable to contracts made and fully to be performed therein.

 

 

	 	THE INTERPUBLIC GROUP OF COMPANIES, INC.
    
	 	 	 
	 	 	 
	 	By:  	/s/ Timothy Sompolski   
	 	 	Timothy Sompolski
	 	 	Executive Vice President
	 	 	Chief Human Resources Officer
	 	 	 
	 	 	 
	 	
	              /s/ Steve Gatfield              
	 	
	Steve Gatfield
	 

 

 

 

- 8 -Exhibit 10.1

                       AMENDMENT AND FEE WAIVER AGREEMENT

     This Amendment and Fee Waiver  Agreement dated as of February 28, 2006 (the
"Amendment and Fee Waiver  Agreement") is entered into by and between  Windswept
Environmental Group, Inc., a Delaware  corporation (the "Borrower"),  and Laurus
Master Fund, Ltd., a Cayman Islands company  ("Laurus"),  and is effective as of
February 28, 2006.  Capitalized terms used herein without  definition shall have
the meanings  ascribed to such terms in the  Securities  Purchase  Agreement (as
defined below) and the Note (as defined below).

     WHEREAS, the Borrower filed a registration statement on October 3, 2005 (as
amended, modified or supplemented,  the "Registration  Statement"),  in order to
register certain shares of the Borrower's Common Stock (as amended,  modified or
supplemented, the "Common Stock") underlying (a) an Amended and Restated Secured
Convertible  Term Note the  Borrower  issued to Laurus on October 6, 2005 in the
aggregate  original  principal  amount of  $7,350,000 ( as amended,  modified or
supplemented,  the  "Note")  pursuant  to the terms of the  Securities  Purchase
Agreement,  dated as of June 30,  2005  between  the  Borrower  and  Laurus ( as
amended,  modified or  supplemented,  the  "Securities  Purchase  Agreement" and
together with the Related Agreements as defined therein,  the "Loan Documents");
(b) a warrant  issued by the  Borrower  to Laurus on June 30,  2005 to  purchase
13,750,000 shares of the Common Stock (as amended, modified or supplemented, the
"Warrant");  and (c) an option issued by the Borrower to Laurus on June 30, 2005
to  purchase  30,395,179  shares  of  Common  Stock  (as  amended,  modified  or
supplemented, the "Option");

     WHEREAS,  the Borrower and Laurus  entered  into  Amendment  and Fee Waiver
Agreements   dated  as  of   November   23,  2005  and  January  13,  2006  (the
"Amendments");

     WHEREAS,  pursuant  to Section 3.7 of the Note and Section 1 of each of the
Amendments,  the  Borrower  is  obligated  to reserve  from its  authorized  and
unissued shares of Common Stock a sufficient number of shares to provide for the
issuance of shares upon the full conversion and/or exercise of the Warrant,  the
Option and the Note after the  earlier to occur of (x) March 1, 2006 and (y) the
date of the Borrower's next shareholder's meeting (the "Additional Authorization
Date");

     WHEREAS,  pursuant  to Section 6 of the Option and Section 1 of each of the
Amendments,  the  Borrower  is  obligated  to reserve  from its  authorized  and
unissued Common Stock a sufficient  number of shares to provide for the issuance
of  shares  upon  the  full  exercise  of  the  Option,   after  the  Additional
Authorization Date;

     WHEREAS,  pursuant to Section 6 of the Warrant and Section 1 of each of the
Amendments,  the  Borrower  is  obligated  to reserve  from its  authorized  and
unissued Common Stock a sufficient  number of shares to provide for the issuance
of  shares  upon  the full  conversion  of the  Warrant,  after  the  Additional
Authorization Date;

     WHEREAS,  the Borrower  entered into a securities  purchase  agreement with
Laurus on June 30,  2005 (the  "Securities  Purchase  Agreement")  to set forth,
among other  things,  the terms of the issuance of the Note,  the Option and the
Warrant;

<PAGE>

     WHEREAS,  pursuant to Section 4.3(d) of the Securities  Purchase  Agreement
and Section 1 of each of the  Amendments,  the  Borrower is obligated to reserve
from its authorized and unissued  Common Stock a sufficient  number of shares to
provide for the issuance of shares upon the full  conversion  and/or exercise of
the Note, the Warrant and the Option, after the Additional Authorization Date;

     WHEREAS,  Laurus has agreed to extend the Additional  Authorization Date to
the  earlier  of (x)  April  1,  2006 and (y) the  date of the  Borrower's  next
shareholder's meeting;

     WHEREAS,  the Borrower  entered into a registration  rights  agreement with
Laurus on June 30, 2005 (the  "Registration  Rights  Agreement") in order to set
forth  Borrower's  obligations to register the shares of Common Stock underlying
the  Note,  the  Option  and  the  Warrant  with  the  Securities  and  Exchange
Commission;

     WHEREAS,  Laurus has agreed to extend the deadline for the Borrower to have
its Registration  Statement  declared  effective under the  Registration  Rights
Agreement until April 1, 2006;

     WHEREAS,  pursuant to Section 2(b) of the Registration Rights Agreement and
Section 2 of each of the  Amendments,  the  Borrower  is required to pay a daily
amount  in cash  equal to  one-thirtieth  (1/30th)  of the  product  of the then
outstanding  principal  amount  of the Note  multiplied  by the  following  (the
"Fees") if the  Registration  Statement has not been  declared  effective by the
Securities and Exchange Commission (prior to giving effect to this Amendment and
Fee Waiver Agreement):

     o    1.5% for the first 30 day period beginning on March 2, 2006;

     o    2.0% thereafter and

     WHEREAS,  Laurus has hereby  agreed to postpone  the date by which any Fees
may accrue and become payable until April 2, 2006.

     NOW,  THEREFORE,  in consideration of the mutual promises set forth herein,
and for other good and valuable  consideration,  the receipt and  sufficiency of
which are hereby acknowledged, the parties hereby agree as follows:

     1.  Extension of Time for  Reservation  of Authorized  and Unissued  Common
         -----------------------------------------------------------------------
Stock.  Laurus  hereby  agrees that the date by which the Borrower  must reserve
-----
from its authorized and unissued  Common Stock a sufficient  number of shares to
provide for the issuance or  conversion  of shares upon full  conversion  of the
Note,  the  Warrant  and the Option will be the earlier to occur of (x) April 1,
2006  and (y) the  date  of the  Borrower's  next  shareholders'  meeting.  This
modification shall apply to the following:

     o    the Note;

                                       2
<PAGE>

     o    the Option;

     o    the Warrant; and

     o    the Securities Purchase Agreement.

     2. Extension of Deadline by which the Borrower must have the Securities and
        ------------------------------------------------------------------------
Exchange Commission Declare Effective its Registration Statement.  Laurus hereby
----------------------------------------------------------------
agrees to postpone the deadline by which the Borrower  must have the  Securities
and Exchange Commission declare effective its Registration  Statement from March
1, 2006 until April 1, 2006. This  modification  shall apply to the Registration
Rights Agreement only.

     3.  Postponement.  Laurus  hereby  agrees to postpone the date by which any
         ------------
Fees may accrue and become payable until April 2, 2006.

     4. Laurus  Representations.  Laurus hereby  represents  and warrants to the
        -----------------------
Borrower  that Laurus is an  "accredited  investor" as defined in Rule 501(a) of
Regulation  D  promulgated  under the  Securities  Act of 1933 and a  "qualified
institutional  buyer" as defined in Rule 144A under the  Securities  Act of 1933
and has knowledge and experience in financial and business  matters such that it
is capable of  evaluating  the  merits  and risks of the  investment  to be made
hereunder.

     5. Borrower Representations. The Borrower hereby represents and warrants to
        ------------------------
Laurus  that (i) no Event of Default  exists on the date  hereof,  after  giving
effect to this Amendment and Fee Waiver Agreement,  (ii) on the date hereof, all
representations,  warranties  and  covenants  made by the Borrower in connection
with the Loan  Documents  are true,  correct and  complete and (iii) on the date
hereof, all the Borrower's and its Subsidiaries' covenant requirements have been
met.

     6. From and after the date hereof, all references in the Loan Documents and
in the other Related Agreements to the Post-Closing Letter shall be deemed to be
references to the Post-Closing Letter, as the case may be, as modified hereby.

     7. No Other Amendments. Except as expressly set forth in this Amendment and
        -------------------
Fee Waiver  Agreement no other term or provision of any Loan  Document is hereby
amended or  affected in any way,  and the Loan  Documents  shall  remain in full
force and effect after the date hereof.

     8. The Borrower understands that the Borrower has an affirmative obligation
to make prompt public disclosure of material amendments to such agreements.

     9. Governing Law. This Amendment and Fee Waiver Agreement shall be governed
        -------------
by and construed in accordance  with the laws of the State of New York,  without
regard to principles of conflicts of laws.

                                       3

<PAGE>

     10.  Facsimile  Signatures;  Counterparts.  This  Amendment  and Fee Waiver
          ------------------------------------
Agreement  may  be  executed  by  facsimile  signatures  and in  any  number  of
counterparts,  each of which  shall be an  original,  but all of which  together
shall constitute one instrument.

                                       4

<PAGE>

     IN WITNESS  WHEREOF,  the parties  hereto have executed this Amendment as a
sealed instrument as of the date set forth in the first paragraph hereof.

                                    WINDSWEPT ENVIRONMENTAL GROUP, INC.

                                    By:  /s/Andrew C. Lunetta
                                        --------------------------------
                                        Name:  Andrew C. Lunetta
                                        Title:  Chief Financial Officer

                                    LAURUS MASTER FUND, LTD.

                                    By:  /s/David Grin
                                        ------------------------------
                                        Name:  David Grin
                                        Title:  Director

                                       5

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