Document:

PLAN

                                                                    EXHIBIT 10.35

ARTHROCARE CORPORATION

NONSTATUTORY OPTION PLAN

	Purposes of the Plan.  The purposes of this Nonstatutory Option
Plan are:  

	to attract and retain the best available personnel for positions of
substantial responsibility, 
	to provide additional incentive to Employees and Consultants, and 
	to promote the success of the Company's business.  

Options granted under the Plan may be Nonstatutory Stock Options.  Incentive
Stock Options may not be granted under the Plan.  Stock Purchase Rights may also
be granted under the Plan.  Options and Stock Purchase Rights may not be granted
under the Plan to Officers and Directors.

	Definitions.  As used herein, the following definitions shall apply:

	"Administrator" means the Board or any Committee
administering the Plan, in accordance with Section 4 of the Plan.  
	"Applicable Laws" means the legal requirements relating to
the administration of stock option plans under state corporate and securities
laws and the Code.  
	"Board" means the Board of Directors of the Company.
	"Code" means the Internal Revenue Code of 1986, as
amended.
	"Committee" means a Committee appointed by the Board in
accordance with Section 4 of the Plan.
	"Common Stock" means the Common Stock of the Company.
	"Company" means ArthroCare Corporation, a Delaware
corporation.
	"Consultant" means any person, including an advisor,
engaged by the Company or a Parent or Subsidiary to render services and who is
compensated for such services, provided that the term "Consultant"
shall not include Employees, Directors or Officers.
	"Continuous Status as an Employee or Consultant" means that
the employment or consulting relationship with the Company or any Parent or
Subsidiary is not interrupted or terminated.  Continuous Status as an Employee
or Consultant shall not be considered interrupted in the case of (i) any
leave of absence approved by the Company, including sick leave, military leave,
or any other personal leave or (ii) transfers between locations of the Company
or between the Company, its Parent, its Subsidiaries or its successor.  
	"Director" means a member of the Board.
	"Disability" means total and permanent disability as
defined in Section 22(e)(3) of the Code.
	"Employee" means any person employed by the Company or any
Parent or Subsidiary of the Company; provided, however, that the term Employee
shall not include Officers or Directors.  
	"Exchange Act" means the Securities Exchange Act of 1934,
as amended.
	"Fair Market Value" means, as of any date, the value of
Common Stock determined as follows:  

	if the Common Stock is listed on any established stock exchange or a
national market system, including without limitation the National Market System
of the National Association of Securities Dealers, Inc. Automated Quotation
("NASDAQ") System, the Fair Market Value of a Share of Common Stock
shall be the closing sales price for such stock (or the closing bid, if no sales
were reported) as quoted on such system or exchange (or the exchange with the
greatest volume of trading in Common Stock) on the last market trading day prior
to the day of determination, as reported in The Wall Street Journal or such
other source as the Administrator deems reliable; 
	If the Common Stock is quoted on the NASDAQ System (but not on the National
Market System thereof) or is regularly quoted by a recognized securities dealer
but selling prices are not reported, the Fair Market Value of a Share of Common
Stock shall be the mean between the high bid and low asked prices for the Common
Stock on the last market trading day prior to the day of determination, as
reported in The Wall Street Journal or such other source as the Administrator
deems reliable;
	In the absence of an established market for the Common Stock, the Fair
Market Value shall be determined in good faith by the Administrator.

	"Incentive Stock Option" means an Option intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code and the regulations promulgated thereunder.
	"Nonstatutory Stock Option" means an Option not intended to
qualify as an Incentive Stock Option.
	"Notice of Grant" means a written notice evidencing certain
terms and conditions of an individual Option or Stock Purchase Right grant.  The
Notice of Grant is part of the Option Agreement.  
	"Officer" means a person who is an officer of the Company
within the meaning of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder.
	"Option" means a stock option granted pursuant to the
Plan.
	"Option Agreement" means a written agreement between the
Company and an Optionee evidencing the terms and conditions of an individual
Option grant.  The Option Agreement is subject to the terms and conditions of
the Plan.
	"Option Exchange Program" means a program whereby
outstanding options are surrendered in exchange for options with a lower
exercise price.
	"Optioned Stock" means the Common Stock subject to an
Option or Stock Purchase Right.
	"Optionee" means an Employee or Consultant who holds an
outstanding Option or Stock Purchase right.
	"Parent" means a "parent corporation," whether
now or hereafter existing, as defined in Section 424(e) of the Code.  
	"Plan" means this Nonstatutory Option Plan.  
	"Restricted Stock" means share of Common Stock acquired
pursuant to a grant of Stock Purchase Rights under Section 11 below.  

(aa)"Restricted Stock Purchase Agreement" means a
written agreement between the Company and the Optionee evidencing the terms and
restrictions applying to stock purchased under a Stock Purchase Right.  The
Restricted Stock Purchase Agreement is subject to the terms and conditions of
the Plan and the Notice of Grant.

(bb)"Rule 16b-3" means Rule 16b-3 of the Exchange Act or
any successor to Rule 16b-3, as in effect when discretion is being exercised
with respect to the Plan.  

(cc)"Share" means a share of the Common Stock, as
adjusted in accordance with Section 13 of the Plan.  

(dd)"Stock Purchase Right" means the right to purchase
Common Stock pursuant to Section 11 of the Plan, as evidenced by a Notice of
Grant.  

(ee)"Subsidiary" means a "subsidiary
corporation," whether now or hereafter existing, as defined in Section
424(f) of the Code.  

	Stock Subject to the Plan.  Subject to the provisions of Section 13
of the Plan, the maximum aggregate number of Shares which may be optioned and
sold under the Plan is 500,000 Shares.  The Shares may be authorized, but
unissued, or reacquired Common Stock.  

If an Option or Stock Purchase Right expires or becomes unexercisable without
having been exercised in full, or is surrendered pursuant to an Option Exchange
Program, the unpurchased Shares which were subject thereto shall become
available for future grant or sale under the Plan (unless the Plan has
terminated); provided, however; that Shares have actually been issued,
whether upon exercise of an Option or Stock Purchase Right, shall not be
returned to the Plan and shall not become available for future distribution
under the Plan, except that if Shares of Restricted Stock are repurchased by the
Company at their original purchase price, and the original purchaser of such
Shares did not receive any benefits of ownership of such Shares, such Shares
shall become available for future grant under the Plan.  For purposes of the
preceding sentence, voting rights shall not be considered a benefit of ownership
of Shares.

	Administration of the Plan.  

	The Plan shall be administered by (A) the Board or (B) a committee
designated by the Board, which committee shall be constituted to satisfy
Applicable Laws.  Once appointed, such Committee shall serve in its designated
capacity until otherwise directed by the Board.  The Board may increase the size
of the Committee and appoint additional members, remove members (with or without
cause) and substitute new members, fill vacancies (however caused), and remove
all members of the Committee and thereafter directly administer the Plan, all to
the extent permitted by Applicable Laws.

	Powers of the Administrator.  Subject to the provisions of the Plan,
and in the case of a Committee, subject to the specific duties delegated by the
Board to such Committee, the Administrator shall have the authority, in its
discretion:

	to determine the Fair Market Value of the Common Stock, in accordance with
Section 2(n) of the Plan; 
	to select the Consultants and Employees to whom Options and Stock Purchase
Rights may be granted hereunder;
	to determine whether and to what extent Options and Stock Purchase Rights or
any combination thereof, are granted hereunder;
	to determine the number of shares of Common Stock to be covered by each
Option and Stock Purchase Right granted hereunder;
	to approve forms of agreement for use under the Plan;
	to determine the terms and conditions, not inconsistent with the terms of
the Plan, of any award granted hereunder.  Such terms and conditions include,
but are not limited to, the exercise price, the time or times when Options or
Stock Purchase Rights may be exercised (which may be based on performance
criteria), any vesting acceleration or waiver of forfeiture restrictions and any
restriction or limitation regarding any Option or Stock Purchase Right or the
shares of Common Stock relating thereto, based in each case on such factors as
the Administrator, in its sole discretion, shall determine;
	to reduce the exercise price of any Option or Stock Purchase Right to the
then current Fair Market Value if the Fair Market Value of the Common Stock
covered by such Option or Stock Purchase Right shall have declined since the
date the Option or Stock Purchase Right was granted; 
	to construe and interpret the terms of the Plan and awards granted pursuant
to the Plan; 
	to prescribe, amend and rescind rules and regulations relating to the plan;

	to modify and amend each Option or Stock Purchase Right (subject to Section
15(c) of the Plan); 
	to authorize any person to execute on behalf of the Company any instrument
required to effect the grant of an Option or Stock Purchase Right previously
granted  by the Administrator; 
	to institute an Option Exchange Program; 
	to determine the terms and restrictions applicable to Options and Stock
Purchase Rights and any Restricted Stock; 
	to allow Optionees to satisfy withholding tax obligations by electing to
have the Company withhold from the Shares to be issued upon exercise of an
Option or Stock Purchase Right that number of Shares having a Fair Market Value
equal to the minimum amount required to be withheld based on the statutory
withholding rates for federal and state tax purposes that apply to supplemental
taxable income.  The Fair Market Value of the Shares to be withheld shall be
determined on the date that the amount of tax to be withheld is to be
determined.  All elections by Optionees to have Shares withheld for this purpose
shall be made in such form and under such conditions as the Administrator may
deem necessary or advisable; and 
	to make all other determinations deemed necessary or advisable for
administering the Plan.

	Effect of Administrator's Decision.  The Administrator's decisions,
determinations and interpretations shall be final and binding on all Optionees
and any other holders of Options or Stock Purchase Rights.

	Eligibility.  Options and Stock Purchase Rights may be granted to
Employees and Consultants.  If otherwise eligible, an Employee or Consultant who
has been granted an Option or Stock Purchase Right may be granted additional
Options or Stock Purchase Rights.

	Limitations.  Neither the Plan or any Option or Stock Purchase Right
shall confer upon an Optionee any right with respect to continuing the
Optionee's employment or consulting relationship with the Company, nor shall
they interfere in any way with the Optionee's right or the Company's right to
terminate such employment or consulting relationship at any time, with or
without cause.

	Term of Plan.  The Plan shall become effective upon its adoption by
the Board.  It shall continue in effect for a term of ten (10) years unless
terminated earlier under Section 15 of the Plan.

	Term of Option.  The term of each Option shall be stated in the
Notice of Grant.

	Option Exercise Price and Consideration.

	Exercise Price.  The per share exercise price for the Shares to be
issued pursuant to exercise of an Option shall be determined by the
Administrator.

	Waiting Period and Exercise Dates.  At the time an Option is granted,
the Administrator shall fix the period within which the Option may be exercised
and shall determine any conditions which must be satisfied before the Option may
be exercised.  In so doing, the Administrator may specify that an Option may not
be exercised until the completion of a service period.

	Form of Consideration.  The Administrator shall determine the
acceptable form of consideration for exercising an Option, including the method
of payment.  Such consideration may consist entirely of

	cash;
	check;
	delivery of a properly executed exercise notice together with such other
documentation as the Administrator and the broker, if applicable, shall require
to effect an exercise of the Option and delivery to the Company of the sale or
loan proceeds required to pay the exercise price;
	a reduction in the amount of any Company liability to the Optionee,
including any liability attributable to the Optionee's participation in any
Company-sponsored deferred compensation program or arrangement;
	any combination of the foregoing methods of payment; of
	such other consideration and method of payment for the issuance of Shares to
the extent permitted by Applicable Laws.

	Exercise of Option.

	Procedure for Exercise: Rights as a Shareholder.  Any Option granted
hereunder shall be exercisable according to the terms of the Plan and at such
times and under such conditions as determined by the Administrator and set forth
in the Option Agreement.

An Option may not be exercised for a fraction of a Share.

An Option shall be deemed exercised when the Company receives:
(i) written notice of exercise (in accordance with the Option Agreement)
from the person entitled to exercise the Option, and (ii) full payment for the
Shares with respect to which the Option is exercised, including payment of any
applicable withholding tax, which in the discretion of the Administrator may be
in the form of consideration used by the Optionee to pay for such Shares under
Section 9(c).  Full payment may consist of any consideration and method of
payment authorized by the Administrator and permitted by the Option Agreement
and the Plan.  Shares issued upon exercise of an Option shall be issued in the
name of the Optionee or, if requested by the Optionee, in the name of the
Optionee and his or her spouse.  Until the stock certificate evidencing such
Shares is issued (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company), no right to vote
or receive dividends or any other rights as a shareholder shall exist with
respect to the Optioned Stock, notwithstanding the exercise of the Option.  The
Company shall issue (or cause to be issued) such stock certificate promptly
after the Option is exercised.  No adjustment will be made for a dividend or
other right for which the record date is prior to the date the stock certificate
is issued, except as provided in Section 13 of the Plan.

Exercising an Option in any manner shall decrease the number of Shares
thereafter available, both for purposes of the Plan and for sale under the
Option, by the number of Shares as to which the Option is exercised.

	Termination of Employment or Consulting Relationship.  Upon
termination of an Optionee's Continuous Status as an Employee or Consultant,
other than upon the Optionee's death or Disability, the Optionee may exercise
his or her Option, but only within such period of time as is specified in the
Notice of Grant, and only to the extent that the Optionee was entitled to
exercise it at the date of termination (but in no event later than the
expiration of the term of such Option as set forth in the Notice of Grant).  In
the absence of a specified time in the Notice of Grant, the Option shall remain
exercisable for 90 days following the Optionee's termination of Continuous
Status as an Employee or Consultant.  If, at the date of termination, the
Optionee is not entitled to exercise his or her entire Option, the Shares
covered by the unexercisable portion of the Option shall revert to the Plan.
If, after termination, the Optionee does not exercise his or her Option within
the time specified by the Administrator, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.

	Disability of Optionee.  In the event that an Optionee's Continuous
Status as an Employee or Consultant terminates as a result of the Optionee's
Disability, the Optionee may exercise his or her Option at any time within
twelve (12) months from the date of such termination, but only to the extent
that the Optionee was entitled to exercise it at the date of such termination
(but in no event later than the expiration of the term of such Option as set
forth in the Notice of Grant).  If, at the date of termination, the Optionee is
not entitled to exercise his or her entire Option, the Shares covered by the
unexercisable portion of the Option shall revert to the Plan.  If, after
termination, the Optionee does not exercise his or her Option within the time
specified herein, the Option shall terminate, and the Shares covered by such
Option shall revert to the Plan.

	Death of Optionee.  In the event of the death of an Optionee, the
Option may be exercised at any time within twelve (12) months following the date
of death (but in no event later than the expiration of the term of such Option
as set forth in the Notice of Grant), by the Optionee's estate or by a person
who acquired the right to exercise the Option by bequest or inheritance, but
only to the extent that the Optionee was entitled to exercise the Option at the
date of death.  If, at the time of death, the Optionee was not entitled to
exercise his or her entire Option, the Shares covered by the unexercisable
portion of the Option shall immediately revert to the Plan.  If, after death,
the Optionee's estate or a person who acquired the right to exercise the Option
by bequest or inheritance does not exercise the Option within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.

	Rule 16b-3.  Options granted to individuals subject to Section 16 of
the Exchange Act ("Insiders") must comply with the applicable
provisions of Rule l6b-3 and shall contain such additional conditions or
restrictions as may be required thereunder to qualify for the maximum exemption
from Section 16 of the Exchange Act with respect to Plan transactions.

	Stock Purchase Rights.

	Rights to Purchase.  Stock Purchase Rights may be issued either
alone, in addition to, or in tandem with other awards granted under the Plan
and/or cash awards made outside of the Plan.  After the Administrator determines
that it will offer Stock Purchase Rights under the Plan, it shall advise the
offeree in writing, by means of a Notice of Grant, of the terms, conditions and
restrictions related to the offer, including the number of Shares that the
offeree shall be entitled to purchase, the price to be paid, and the time within
which the offeree must accept such offer, which shall in no event exceed six (6)
months from the date upon which the Administrator made the determination to
grant the Stock Purchase Right.  The offer shall be accepted by execution of a
Restricted Stock Purchase Agreement in the form determined by the
Administrator.

	Repurchase Option.  Unless the Administrator determines otherwise,
the Restricted Stock Purchase Agreement shall grant the Company a repurchase
option exercisable upon the voluntary or involuntary termination of the
purchaser's employment with the Company for any reason (including death or
Disability).  The purchase price for Shares repurchased pursuant to the
Restricted Stock purchase agreement shall be the original price paid by the
purchaser and may be paid by cancellation of any indebtedness of the purchaser
to the Company.  The repurchase option shall lapse at a rate determined by the
Administrator.

	Rule 16b-3.  Stock Purchase Rights granted to Insiders, and Shares
purchased by Insiders in connection with Stock Purchase Rights, shall be subject
to any restrictions applicable thereto in compliance with Rule 16b-3.  An
Insider may only purchase Shares pursuant to the grant of a Stock Purchase
Right, and may only sell Shares purchased pursuant to the grant of a Stock
Purchase Right, during such time or times as are permitted by Rule l6b-
3.

	Other Provisions.  The Restricted Stock Purchase Agreement shall
contain such other terms, provisions and conditions not inconsistent with the
Plan as may be determined by the Administrator in its sole discretion.  In
addition, the provisions of Restricted Stock Purchase Agreements need not be the
same with respect to each purchaser.

	Rights as a Shareholder.  Once the Stock Purchase Right is exercised,
the purchaser shall have the rights equivalent to those of a shareholder, and
shall be a shareholder when his or her purchase is entered upon the records of
the duly authorized transfer agent of the Company.  No adjustment will be made
for a dividend or other right for which the record date is prior to the date the
Stock Purchase Right is exercised, except as provided in Section 13 of the
Plan.

	Non-Transferability of Options and Stock Purchase Rights.  An Option
or Stock Purchase Right may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the lifetime of the
Optionee, only by the Optionee.

	Adjustments Upon Chances in Capitalization, Dissolution, Merger, Asset
Sale or Chance of Control.

	Chances in Capitalization.  Subject to any required action by the
shareholders of the Company, the number of shares of Common Stock covered by
each outstanding Option and Stock Purchase Right, and the number of shares of
Common Stock which have been authorized for issuance under the Plan but as to
which no Options or Stock Purchase Rights have yet been granted or which have
been returned to the Plan upon cancellation or expiration of an Option or Stock
Purchase Right, as well as the price per share of Common Stock covered by each
such outstanding Option or Stock Purchase Right, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without receipt
of consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been
"effected without receipt of consideration."  Such adjustment shall be
made by the Board, whose determination in that respect shall be final, binding
and conclusive.  Except as expressly provided herein, no issuance by the Company
of shares of stock of any class, or securities convertible into shares of stock
of any class, shall affect, and no adjustment by reason of such issuance shall
be made with respect to, the number or price of shares of Common Stock subject
to an Option or Stock Purchase Right.

	Dissolution or Liquidation.  In the event of the proposed dissolution
or liquidation of the Company, to the extent that an Option or Stock Purchase
Right has not been previously exercised, it will terminate immediately prior to
the consummation of such proposed action.  The Board may, in the exercise of its
sole discretion in such instances, declare that any Option or Stock Purchase
Right shall terminate as of a date fixed by the Board and give each Optionee the
right to exercise his or her Option or Stock Purchase Right as to all or any
part of the Optioned Stock, including Shares as to which the Option or Stock
Purchase Right would not otherwise be exercisable.

	Merger or Asset Sale.  In the event of a merger of the Company with
or into another corporation, or the sale of substantially all of the assets of
the Company, each outstanding Option and Stock Purchase Right shall be assumed
or an equivalent option or right shall be substituted by the successor
corporation or a Parent or Subsidiary of the successor corporation.  The
Administrator may, in lieu of such assumption or substitution, provide for the
Optionee to have the right to exercise the Option or Stock Purchase Right as to
all or a portion of the Optioned Stock, including Shares as to which it would
not otherwise be exercisable.  If the Administrator makes an Option or Stock
Purchase Right exercisable in lieu of assumption or substitution in the event of
a merger or sale of assets, the Administrator shall notify the Optionee that the
Option or Stock Purchase Right shall be fully exercisable for a period of
fifteen (15) days from the date of such notice, and the Option or Stock Purchase
Right will terminate upon the expiration of such period.  For the purposes of
this paragraph, the Option or Stock Purchase Right shall be considered assumed
if, following the merger or sale of assets, the option or right confers the
right to purchase, for each Share of Optioned Stock subject to the Option or
Stock Purchase Right immediately prior to the merger or sale of assets, the
consideration (whether stock, cash, or other securities or property) received in
the merger or sale of assets by holders of Common Stock for each Share held on
the effective date of the transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of
the outstanding Shares); provided, however, that if such consideration received
in the merger or sale of assets was not solely common stock of the successor
corporation or its Parent, the Administrator may, with the consent of the
successor corporation, provide for the consideration to be received upon the
exercise of the Option or Stock Purchase Right, for each Share of Optioned Stock
subject to the Option or Stock Purchase Right, to be solely common stock of the
successor corporation or its Parent equal in fair market value to the per share
consideration received by holders of Common Stock in the merger or sale of
assets.

	Date of Grant.  The date of grant of an Option or Stock Purchase
Right shall be, for all purposes, the date on which the Administrator makes the
determination granting such Option or Stock Purchase Right, or such other later
date as is determined by the Administrator.  Notice of the determination shall
be provided to each Optionee within a reasonable time after the date of such
grant.

	Amendment and Termination of the Plan.

	Amendment and Termination.  The Board may at any time amend, alter,
suspend or terminate the Plan.

	Effect of Amendment or Termination.  No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the
Company.

	Conditions Upon Issuance of Shares.

	Legal Compliance.  Shares shall not be issued pursuant to the
exercise of an Option or Stock Purchase Right unless the exercise of such Option
or Stock Purchase Right and the issuance and delivery of such Shares shall
comply with all relevant provisions of law, including, without limitation, the
Securities Act of 1933, as amended, the Exchange Act, the rules and regulations
promulgated thereunder, Applicable Laws, and the requirements of any stock
exchange or quotation system upon which the Shares may then be fisted or quoted,
and shall be further subject to the approval of counsel for the Company with
respect to such compliance.

	Investment Representations.  As a condition to the exercise of an
Option or Stock Purchase Right, the Company may require the person exercising
such Option or Stock Purchase Right to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares if, in the
opinion of counsel for the Company, such a representation is required.

	Liability of Company.

	Inability to Obtain Authority.  The inability of the Company to
obtain authority from any regulatory body having jurisdiction, which authority
is deemed by the Company's counsel to be necessary to the lawful issuance and
sale of any Shares hereunder, shall relieve the Company of any liability in
respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.

	Grants Exceeding Allotted Shares.  If the Optioned Stock covered by
an Option or Stock Purchase Right exceeds, as of the date of grant, the number
of Shares which may be issued under the Plan, such Option or Stock Purchase
Right shall be void with respect to such excess Optioned Stock, unless an
amendment sufficiently increasing the number of Shares subject to the Plan is
adopted in accordance with Section 15(a) of the Plan.

	Reservation of Shares.  The Company, during the term of this Plan,
will at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.EXHIBIT 10.22
                              YOUNG & RUBICAM INC.
                        CHANGE IN CONTROL SEVERANCE PLAN

ARTICLE 1.  ESTABLISHMENT AND PURPOSE

     1.1  ESTABLISHMENT  OF THE PLAN.  Y&R  hereby  establishes  this  Change in
Control  severance  plan to be known as the  "Young &  Rubicam  Inc.  Change  in
Control Severance Plan" (the "Plan").

     1.2 PURPOSE OF THE PLAN. The Board of Directors of Y&R has determined  that
it is in the best  interests of the Company and its  stockholders  to secure the
continued  services,  dedication and objectivity of certain key employees of the
Company in the event of any  threat or  occurrence  of a Change in  Control  (as
defined in Section 2(j)) of Y&R,  without  concern as to whether such  employees
might be hindered or distracted by personal  uncertainties  and risks created by
any such actual or threatened Change in Control.

ARTICLE 2.  DEFINITIONS

     Whenever used in the Plan, the following  terms shall have the meanings set
forth below:

     (a) "AGE  SUPPLEMENT"  means the number of years,  if any,  specified  in a
Participant's  Participation  Schedule to be added to the  Participant's age for
purposes  of  computing  the  amount of and the  Participant's  eligibility  for
benefits  afforded by the Company  under the Pension  Plans and Welfare  Benefit
Plans.

     (b) "BASE SALARY" means a  Participant's  highest  annual rate of salary or
wages,  including any amounts  deferred at the election of the  Participant,  in
effect  at  any  time  during  the  twelve  months  immediately  preceding  such
Participant's Termination Date.

     (c)  "BENEFICIARY"  means the  persons or  entities  entitled  to  benefits
hereunder upon a Participant's death.

     (d) "BENEFICIAL OWNER" shall have the meaning ascribed to such term in Rule
13d-3 under the  Exchange  Act and any  successor  to such Rule  (except  that a
Person  shall be deemed to be the  Beneficial  Owner of all shares that any such
Person has the right to acquire pursuant to any agreement or arrangement or upon
exercise of conversion rights, warrants or options or otherwise,  without regard
to the sixty day period referred to in Rule 13d-3 under the Exchange Act).

     (e)  "BENEFIT   CONTINUATION  PERIOD"  means  the  period  specified  in  a
Participant's   Participation  Schedule  during  which  the  Benefit  Plans  are
continued pursuant to Section 6.1(c) hereof.

     (f) "BENEFIT PLANS" means Welfare Benefit Plans and Fringe Benefits.

     (g) "BOARD" means the Board of Directors of Y&R or its successor.
<PAGE>

     (h) "BONUS AMOUNT" means the greater of (i) the annual target bonus for the
Participant  as of the date  immediately  prior to the Change in Control or (ii)
the annual  average of the bonuses  payable to the  Participant,  including  any
amounts deferred at the election of the  Participant,  with respect to the three
calendar years preceding the Change in Control (excluding any bonus payable as a
result of a Change in Control),  provided  that if a  Participant  has less than
three full years of  employment  with the Company  prior to the calendar year in
which a Change in Control  occurs,  this  clause (ii) shall equal the product of
(A)(1) the aggregate  annual bonuses payable to the Participant  with respect to
the period of employment prior to the calendar year in which a Change in Control
occurs,  including  any  amounts  deferred at the  election of the  Participant,
divided by (2) the number of full months of the Participant's  employment during
such period multiplied by (B) twelve (12).

     (i) "CAUSE" when used in connection with the termination of a Participant's
employment  by the Company  under the Plan,  means (a) the willful and continued
failure  by the  Participant  substantially  to  perform  his or her  duties and
obligations  to the  Company  as in effect  immediately  prior to the  Change in
Control  (other  than any such  failure  resulting  from any  physical or mental
condition, whether or not such condition constitutes a Disability) which failure
continues  after Y&R has given notice  thereof to the  Participant  which notice
specifies the aspects in which the  Participant has failed to perform his or her
duties or obligations to the Company and sets forth specific  corrective  action
required of the  Participant or (b) the willful  engaging by the  Participant in
misconduct  which  is  materially  injurious  to  the  Company,   monetarily  or
otherwise.  For  purposes  of this  definition,  no act, or failure to act, on a
Participant's  part shall be considered  "willful" unless done, or omitted to be
done, by the Participant in bad faith and without  reasonable belief that his or
her action or omission was in the best interests of the Company.

     (j) "CHANGE IN CONTROL" shall be deemed to have occurred if:

     (i) any Person  (other  than Y&R,  any trustee or other  fiduciary  holding
securities under any employee benefit plan of the Company, the Management Voting
Trust, or any company owned, directly or indirectly,  by the stockholders of Y&R
immediately  prior to the  occurrence  with respect to which the  evaluation  is
being made in  substantially  the same  proportions  as their  ownership  of the
common stock of Y&R  immediately  prior to the occurrence  with respect to which
the  evaluation  is being  made)  becomes  the  Beneficial  Owner,  directly  or
indirectly,  of  securities  of Y&R  representing  30 % or more of the  combined
voting power of Y&R's then outstanding  securities (other than as a result of an
issuance of voting securities initiated by Y&R to any such Person);

                  (ii) on any date,  persons who are Continuing  Directors shall
         fail to constitute a majority of the members of the Board;

                  (iii) the  consummation  of a merger or  consolidation  of Y&R
         with any other entity,  which merger or  consolidation  would result in
         either (A) the voting  securities of Y&R outstanding  immediately prior
         to such  merger  or  consolidation  failing  to  represent  (either  by
         remaining  outstanding or by being converted into voting  securities of
         the surviving or resulting  publicly-held parent entity) 40% or more of
         the combined  voting power of the surviving or resulting  publicly-held
         parent   entity   outstanding   immediately

                                       2
<PAGE>

         after such merger or consolidation or (B) (x) the voting  securities of
         Y&R  outstanding  immediately  prior to such  merger  or  consolidation
         continuing to represent  (either by remaining  outstanding  or by being
         converted  into  voting   securities  of  the  surviving  or  resulting
         publicly-held  parent  entity)  at least  40% but less  than 60% of the
         combined voting power of the surviving or resulting entity  outstanding
         immediately   after  such  merger  or  consolidation  and  (y)  (I)  in
         connection with such merger or consolidation,  there is an acceleration
         of the vesting or exercisability of any material amount of, or material
         percentage of,  outstanding stock options or other stock awards granted
         by the entity with which such merger or  consolidation  is taking place
         or any of its  affiliates  and/or one or more of the five  highest-paid
         executive  officers of such other entity becomes  eligible for material
         severance rights not theretofore  available,  and/or (II) a majority of
         the directors of the surviving or resulting publicly-held parent entity
         immediately  following such merger or consolidation are not persons who
         were Continuing  Directors of Y&R  immediately  prior to such merger or
         consolidation;

                  (iv) the  stockholders  of Y&R approve a plan or agreement for
         the sale or disposition of all or substantially all of the consolidated
         assets of Y&R (other than such a sale or disposition  immediately after
         which such assets will be owned  directly  or  indirectly  by an entity
         owned by the stockholders of Y&R in substantially  the same proportions
         as their ownership of the common stock of Y&R immediately prior to such
         sale or  disposition)  in which  case the  Board  shall  determine  the
         effective  date of the Change in  Control  resulting  therefrom,  which
         shall not be later than the  consummation  of such sale or disposition;
         or

                  (v) any other event occurs which the Board determines,  in its
         discretion, to be a Change in Control.

         (k) "COMPANY"  means Young & Rubicam Inc.,  organized under the laws of
the state of Delaware,  including any and all subsidiaries,  or any successor or
successors thereto.

         (l)  "CONTINUING   DIRECTORS"   means,  as  of  any  determined   date,
individuals  who,  (a) as of the later of the date of this Plan and the date two
years prior to such  determination  date, were directors,  or (b) were initially
elected  or  appointed  to the  Board  by a  two-thirds  vote of the  Continuing
Directors  then in office or were  initially  nominated  for  election  by Y&R's
shareholders  by a two-thirds  vote of the Continuing  Directors then in office;
provided,  that no individual designated or proposed by a Person who has entered
into an  agreement  with Y&R to effect a  transaction  described  in clause (i),
(iii) or (iv) of the definition of "Change in Control",  and no individual whose
initial appointment,  election or nomination as a director occurs as a result of
an actual or threatened  election contest (as such terms are used in Rule 14a-11
under the Exchange Act) or other actual or threatened solicitation of proxies or
consents by or on behalf of any Person other than the Board,  shall constitute a
Continuing Director.

         (m)  "DISABILITY"  shall  mean  (i)  a  physical  or  mental  condition
entitling the Company to terminate the Participant's  employment  pursuant to an
employment  agreement  between  the  Participant  and the Company or (ii) in the
absence of such a provision for  disability  termination or in the absence of an
employment  agreement,  a physical or mental  incapacity of a Participant  which
entitles  the  Participant  to  benefits  under  the long term  disability  plan
applicable  to the
                                       3
<PAGE>
Participant  and maintained by the Company as in effect  immediately  prior to a
Change in Control.

         (n) "ERISA" means the Employee  Retirement Income Security Act of 1974,
as amended.

         (o)  "EXCHANGE  ACT"  means the  Securities  Exchange  Act of 1934,  as
amended from time to time,  including rules thereunder and successor  provisions
and rules thereto.

         (p) "FRINGE BENEFITS" means any material fringe benefit provided to the
Participant by the Company immediately prior to the Termination Date or, if more
favorable to the Participant, immediately prior to the Change in Control.

         (q) "GOOD  REASON,"  when used with  reference  to a  termination  of a
Participant's  employment with the Company,  shall mean, without a Participant's
express written  consent,  the occurrence of any of the following  events during
the Protected Period:

                  (i)  The   assignment  to  the   Participant   of  any  duties
         inconsistent  with,  or the  reduction of powers,  responsibilities  or
         functions associated with, the Participant's  positions and status with
         the Company immediately prior to a Change in Control, or any removal of
         the Participant from, or any failure to reelect the Participant to, any
         positions  or  offices  with  the  Company  that the  Participant  held
         immediately prior to a Change in Control, except in connection with the
         termination of the Participant's employment by the Company for Cause or
         on account of Disability pursuant to the requirements of the Plan;

                  (ii) A  reduction  by the  Company of the  Participant's  base
         salary as in effect immediately prior to a Change in Control or of such
         higher  base  salary as may have been in effect  during  the  Protected
         Period,  except in connection with the termination of the Participant's
         employment  by the  Company  for  Cause  or on  account  of  Disability
         pursuant to the requirements of the Plan;

                  (iii) The  failure by the Company to pay the  Participant  any
         portion of his or her  current  compensation,  or any portion of his or
         her compensation  deferred under any plan,  agreement or arrangement of
         or with the Company within seven (7) days of the date such compensation
         is due;

                  (iv) A change in the  Participant's  principal  work  location
         more than  fifty  (50)  miles  from the  Participant's  principal  work
         location immediately prior to a Change in Control;

                  (v) A  change  in the  Participant's  required  travel  on the
         Company's   business  to  the  extent  such  travel   obligations   are
         substantially  inconsistent  with  the  Participant's  business  travel
         obligations immediately prior to a Change in Control;

                  (vi) (A) The  failure by the Company to continue in effect any
         Benefit Plans (or substitute plans, programs or arrangements  providing
         the Participant with substantially similar benefits), (B) the taking of
         any action,  or the failing to take any  action,  by the

                                       4
<PAGE>

         Company   which   could  (x)   adversely   affect   the   Participant's
         participation  in, or  materially  reduce  the  Participant's  benefits
         under, such Benefit Plans or (y) materially  adversely affect the basis
         for computing  benefits under such Benefit Plans, or (C) the failure by
         the Company to provide the Participant with the number of paid vacation
         days to which  the  Participant  was  entitled  immediately  prior to a
         Change in Control in  accordance  with the  Company's  vacation  policy
         applicable to the Participant then in effect,  except, in each case, in
         connection with the termination of the Participant's  employment by the
         Company  for  Cause  or  on  account  of  Disability  pursuant  to  the
         requirements of the Plan;

                   (vii) The  failure by the  Company to afford the  Participant
         annual bonus and long-term  incentive  compensation  opportunities at a
         level  which  is at least  equal  to the  level  of  annual  bonus  and
         long-term  incentive  compensation  opportunities made available to the
         Participant immediately prior to the Change in Control;

                  (viii) A material  increase in the required  working  hours of
         the Participant from that required prior to the Change in Control;

                  (ix) The failure by the Company to obtain  pursuant to Section
         10.1 an assumption of the  obligations of the Company under the Plan by
         any successor to the Company; or

                  (x) Any  other  event  which  is  expressly  described  in the
         Participant's  Participation  Schedule as Good Reason occurs during the
         Protected Period.

         Notwithstanding the foregoing, an isolated and inadvertent action taken
in good faith and which is remedied  by the  Company  within five (5) days after
receipt of notice thereof given by the  Participant  shall not  constitute  Good
Reason.

         (r) "NON-QUALIFYING TERMINATION" means a termination of a Participant's
employment (1) by the Company for Cause,  (2) by the  Participant for any reason
other  than  Good  Reason,  or (3) as a  result  of the  Participant's  death or
Disability.

         (s)  "PARTICIPANT"  means an employee of the Company who  fulfills  the
eligibility and participation requirements, as provided in Article 4 herein.

         (t)  "PARTICIPATION   SCHEDULE"  means  the  schedule   evidencing  the
Participant's participation in the Plan.

         (u)  "PENSION  PLAN" shall mean,  with  respect to a  Participant,  any
employee pension plan of the Company within the meaning of Section 3(2) of ERISA
in which the Participant was  participating  immediately  prior to the Change in
Control.

         (v)  "PERFORMANCE  SHARE AMOUNT" means a lump-sum cash payment equal to
the greater of (i) the target  award for the  Participant  for the award  period
beginning on January 1 of the year  immediately  prior to the  calendar  year in
which the Change in Control occurs or (ii) 50% of the Participant's  annual rate
of salary or wages,  including  any  amounts  deferred  at the  election  of the
Participant, in effect immediately prior to the Change in Control.

                                       5
<PAGE>

         (w) "PERFORMANCE SHARE PLAN" means the Company's performance share plan
implemented  pursuant to the Young & Rubicam Inc.  1997  Incentive  Compensation
Plan, as may be amended from time to time.

         (x)  "PERSON"  shall have the meaning  ascribed to such term in Section
3(a)(9) of the Exchange Act and used in Sections  13(d) and 14(d)  thereof,  and
shall include a "group" as defined in Section 13(d) thereof.

         (y) "PLAN" means this Young & Rubicam Inc. Change in Control  Severance
Plan.

         (z)  "PROTECTED  PERIOD"  shall mean the period  beginning on the first
date  during the Term on which a Change in  Control  occurs and ending two years
after that date.  Anything  in the Plan to the  contrary  notwithstanding,  if a
Participant's  employment  with the  Company  is  terminated  or the  terms  and
conditions of the  Participant's  employment  are adversely  changed in a manner
which  would  constitute   grounds  for  a  termination  of  employment  by  the
Participant  for Good  Reason  prior to the  date on which a Change  in  Control
occurs, and it is reasonably demonstrated that such termination of employment or
adverse  change  (i) was at the  request  of a third  party who has taken  steps
reasonably  calculated to effect the Change in Control or (ii)  otherwise  arose
within six months of and in connection  with or in anticipation of the Change in
Control,  then for all  purposes  of the Plan the  "Protected  Period"  for such
Participant  shall  begin  on the  date  immediately  prior  to the date of such
termination  of employment or adverse change and end two years after the date of
such Change in Control.

         (aa)  "RESTRICTIVE  COVENANTS"  shall mean the  covenants  set forth in
Article 11 of the Plan.

         (bb) "SERVICE  SUPPLEMENT" means the number of years, if any, specified
in a  Participant's  Participation  Schedule  to be added  to the  Participant's
service  for  purposes  of  computing  the  amount  of,  and  the  Participant's
eligibility for,  benefits  afforded by the Company under the Company's  Welfare
Benefit  Plans and under the Company's  Pension  Plans that are defined  benefit
plans as provided in Article 6.

         (cc) "SEVERANCE  FACTOR" means the number  specified in a Participant's
Participation  Schedule  used to determine the  Severance  Payment  payable to a
Participant pursuant to Section 6.1(b) hereof.

         (dd)  "SEVERANCE  PAYMENT" means the benefit payable in accordance with
Section 6.1(b) of the Plan.

         (ee) "TERM" means the period  commencing on the date of adoption of the
Plan and ending on the third anniversary of such date; provided,  however,  that
commencing  on the date one year after the date of adoption of the Plan,  and on
each anniversary of such date (such date and each annual anniversary  thereof is
hereinafter  referred to as the "Renewal Date"), the Term shall be automatically
extended with respect to a Participant so as to terminate  three years from such
Renewal  Date,  unless at least 60 days prior to the  Renewal  Date the  Company
shall give notice to such Participant that the Term shall not be so extended.

                                       6
<PAGE>

         (ff) "TERMINATION  DATE" shall be the effective date of a Participant's
termination of employment as provided in Article 5.

         (gg) "WELFARE BENEFIT PLANS" means any employee  benefit plan,  program
or  arrangement  within  the  meaning  of  Section  3(1) of ERISA,  in which the
Participant was  participating  immediately prior to the Termination Date or, if
more favorable to the Participant, immediately prior to the Change in Control.

         (hh)  "WITHOUT  CAUSE",  when used in reference to a  termination  of a
Participant's  employment  with the Company,  shall mean any  termination of the
Participant's  employment  which is not a termination  of employment  for Cause,
Disability or death.

         (ii)     "Y&R" means Young & Rubicam Inc. and its successors.

ARTICLE 3.  ADMINISTRATION

         The Plan shall be administered by the Board.  The Board shall have full
authority, consistent with the Plan, to administer the Plan, including authority
to interpret and construe any provisions of the Plan. The decisions of the Board
shall be final and binding on all parties.

ARTICLE 4.  PARTICIPATION

                  The Board shall  designate  those key employees of the Company
entitled to  participate in the Plan;  provided,  that the Board may delegate to
the  Compensation  Committee of the Board or the Chief Executive  Officer of the
Company the right to designate non-executive officers entitled to participate in
the Plan. Each key employee so designated shall receive a Participation Schedule
in substantially  the form attached hereto.  Such  Participation  Schedule shall
specify:  (a) the Severance Factor; (b) the Benefit Continuation Period; (c) the
Age Supplement or Service Supplement, if any; (d) whether or not the Participant
will be entitled to the  additional  payment  under Section 7.3 or be subject to
the  limitations  of Section 7.3; and (e) the  additional  events,  if any, that
constitute termination of employment for Good Reason.  Notwithstanding  anything
in the Plan to the contrary, as a condition to participation, a Participant must
execute an agreement to be bound by the Restrictive  Covenants in  substantially
the  form  attached  hereto,  within  thirty  (30)  days  after  the date of the
Participant's Participation Schedule.

ARTICLE 5.  TERMINATION OF EMPLOYMENT

         5.1  TERMINATION  OF EMPLOYMENT OF A PARTICIPANT  BY THE COMPANY DURING
THE PROTECTED PERIOD.  (a) During the Protected  Period,  the Company shall have
the right to  terminate a  Participant's  employment  hereunder  for Cause,  for
Disability,  Without Cause or on account of the Participant's death by following
the procedures hereinafter specified.

         (b)  Termination of a  Participant's  employment  for Disability  shall
become  effective  thirty  (30) days after a notice of intent to  terminate  the
Participant's   employment,   specifying   Disability  as  the  basis  for  such
termination,  is  given  to the  Participant  by  the  Board.  Termination

                                       7
<PAGE>

of a  Participant's  employment  on  account  of his or her death  shall  become
effective as of the date of his or her death.

         (c) A Participant  may not be  terminated  for Cause unless and until a
notice of intent to terminate the Participant's employment for Cause, specifying
the  particulars  of the conduct of the  Participant  forming the basis for such
termination  and  setting  forth  specific  corrective  action  required  of the
Participant,  is given to the  Participant  by the Board  and,  subsequently,  a
majority of the Board finds,  after reasonable notice to the Participant (but in
no event  less than  fifteen  (15)  days'  notice)  and an  opportunity  for the
Participant and his or her counsel to be heard by the Board, that termination of
the  Participant's  employment  for  Cause  is  justified.  Termination  of  the
Participant's employment for Cause shall become effective after such finding has
been made by the Board and five (5)  business  days after the Board gives to the
Participant notice thereof,  specifying in detail the particulars of the conduct
of the Participant found by the Board to justify such termination for Cause.

         (d)  The  Company  shall  have  the  absolute   right  to  terminate  a
Participant's  employment Without Cause at any time by vote of a majority of the
Board.  Termination  of the  Participant's  employment  Without  Cause  shall be
effective five (5) business days after the Board gives to the Participant notice
thereof, specifying that such termination is Without Cause.

         5.2  TERMINATION  OF EMPLOYMENT  BY A PARTICIPANT  DURING THE PROTECTED
PERIOD.  During  the  Protected  Period,  a  Participant  shall be  entitled  to
terminate his or her employment with the Company and, if such termination is for
Good  Reason,  to receive the  benefits  provided  in Section  6.1  hereof.  The
Participant shall give Y&R notice of voluntary termination of employment,  which
notice need specify only Participant's desire to terminate his or her employment
and, if such termination is for Good Reason,  set forth in reasonable detail the
facts and  circumstances  claimed by the  Participant to constitute Good Reason.
Termination  of  Participant's  employment by the  Participant  pursuant to this
Section 5.2 shall be  effective  ten (10)  business  days after the  Participant
gives notice thereof to Y&R.

ARTICLE 6.  PAYMENTS UPON TERMINATION OF EMPLOYMENT IN CERTAIN CIRCUMSTANCES

         6.1 TERMINATION OTHER THAN  NON-QUALIFYING  TERMINATION.  If during the
Protected Period, the employment of a Participant shall terminate, other than by
reason of a Non-Qualifying  Termination,  then the Company shall provide to such
Participant the following benefits:

         (a)  ACCRUED  COMPENSATION.  Y&R shall pay to the  Participant,  within
thirty (30) days following the Termination Date, a lump sum cash amount equal to
the  sum  of  (i)  the  full  Base  Salary  (without  regard  to  any  reduction
constituting Good Reason) earned by the Participant through the Termination Date
and  unpaid  at the  Termination  Date,  (ii) any  bonus  awards  earned  by the
Participant but not yet paid or credited as a deferral at the Termination  Date,
(iii) the  amount of any Base  Salary  attributable  to  vacation  earned by the
Participant but not taken before the Termination  Date, and (iv)  one-twelfth of
the  Participant's  Bonus Amount  times the number of months and parts  thereof,
from the beginning of the calendar year including the  Termination  Date through
the Termination Date.

                                       8
<PAGE>

         (b) SEVERANCE PAYMENT. Y&R shall pay to the Participant, not later than
thirty (30) days  following  the  Termination  Date, a lump-sum  cash  Severance
Payment equal to the sum of the product of the  Participant's  Severance  Factor
times the sum of (i) the  Participant's  Base Salary and (ii) the  Participant's
Bonus Amount.

         (c) BENEFITS CONTINUATION. The Company shall maintain in full force and
effect (or  otherwise  provide)  with respect to the  Participant  (and,  to the
extent applicable, his or her dependents) all Benefit Plans, upon the same terms
and otherwise to the same extent as such Benefit Plans shall have been in effect
immediately  prior  to the  Termination  Date  (or,  if  more  favorable  to the
Participant,  immediately prior to the Change in Control),  until the expiration
of the Benefit  Continuation Period,  provided that the Participant's  continued
participation is possible under the general terms and provisions of such Benefit
Plans. The Company and the Participant shall share the costs of the continuation
of such  Benefit  Plans  in the  same  proportion  as  such  costs  were  shared
immediately  prior  to the  Termination  Date  (or,  if  more  favorable  to the
Participant,  immediately prior to the Change in Control). In the event that the
Participant's  participation in any such Benefit Plan is prohibited, the Company
shall arrange to provide the Participant with benefits  substantially similar to
those which the Participant is entitled to receive under such Benefit Plan. Each
Benefit  Plan  continued  under this  Section  6(c) shall  cease on the date the
Participant  becomes  reemployed  and covered under another  employer's  benefit
plans  providing  the same type and  level of  benefits.  In the event  that the
Participant  becomes  reemployed  and covered under another  employer's  benefit
plans that do not  provide the same level of  benefits,  the  benefits  received
under the Benefit  Plans shall be offset by any benefits  received  from the new
employer.

         (d)       PENSION PLAN CALCULATION.

                  (i) DEFINED  BENEFIT PLAN.  With respect to Pension Plans that
         are  qualified  defined  benefit  pension  plans,  Y&R shall pay to the
         Participant  (or his or her  beneficiary  upon  his or her  death)  the
         excess, if any, of:

                           (A)  the  benefit  the  Participant  (or  his  or her
                  Beneficiary,  as the case may be) would have been  entitled to
                  receive  under the Pension Plan  determined  as though (i) the
                  Participant  continued  to  participate  in the  Pension  Plan
                  through the  Termination  Date and as though his or her age at
                  the Termination Date were increased by the Age Supplement,  if
                  any,  and his or her  service  at the  Termination  Date  were
                  increased  by the  Service  Supplement,  if any,  and (ii) the
                  Participant  were  fully  vested  in the  accrued  benefit  so
                  determined; over

                           (B) the benefit  actually  payable to the Participant
                  (or such  Beneficiary,  as the case may be) under the  Pension
                  Plan based on his or her actual age,  service and compensation
                  through the Termination Date.

         Except as specifically  provided  herein,  such excess benefit shall be
         determined,  and payment thereof shall commence, in accordance with the
         provisions,  rules,  and  assumptions of the Pension Plan (assuming the
         Age Supplement and the Service

                                       9
<PAGE>

         Supplement were credited  thereunder),  but shall actually be paid from
         the general assets of Y&R.

                  (ii) DEFINED  CONTRIBUTION PLAN. With respect to Pension Plans
         that  are  defined  contribution  plans,  the  Company  shall  continue
         contributions  to such plan at the same level as were made  immediately
         prior to the date of the Change in Control for the Benefit Continuation
         Period as if the  Participant  had remained  employed  with the Company
         through  the  end of  such  period,  provided  that  the  Participant's
         continued  participation  is  possible  under  the  general  terms  and
         provisions of such plan. In the event the  Participant's  participation
         in the plan is  prohibited,  Y&R  shall pay the  Participant  an amount
         equal to the value of such benefit in a lump-sum cash payment not later
         than the Termination Date from the general assets of Y&R.

         (e)  OTHER  RETIREMENT  BENEFITS.   For  purposes  of  determining  the
Participant's  eligibility  for  early or other  retirement  benefits  under the
Benefit  Plans,  the  Participant's  age and service  factors  thereunder at the
Termination Date shall be increased by the amount,  if any, of the Participant's
Age Supplement  and the  Participant's  Service  Supplement,  respectively.  The
Company  shall  continue  to  provide  to the  Participant  and,  to the  extent
applicable,  any beneficiaries and dependents, the benefits and perquisites that
the Company then  provides to early  retirees and retirees who have a comparable
age and  service  factor as the  Participant's  age and service  factors,  as so
increased.

         (f)  INDEMNIFICATION.  Y&R shall indemnify the Participant and hold the
Participant harmless from and against any claim, loss or cause of action arising
from or out of the Participant's performance as an officer, director or employee
of the Company or any of its  subsidiaries or in any other  capacity,  including
any fiduciary  capacity,  in which the Participant  serves at the request of the
Company to the maximum extent permitted by applicable law and Y&R's  Certificate
of Incorporation  and By-Laws (the "Governing  Documents"),  provided that in no
event shall the protection  afforded to the  Participant  hereunder be less than
that afforded under the Governing  Documents as in effect  immediately  prior to
the Change in Control.

         6.2  NON-QUALIFYING  TERMINATION.  If during the  Protected  Period the
employment  of a  Participant  shall  terminate  by reason  of a  Non-Qualifying
Termination,  then Y&R  shall  pay to the  Participant  or to the  Participant's
Beneficiary if a Participant dies while any amount would still be payable to the
Participant  hereunder had the Participant continued to live, within thirty (30)
days following the Termination  Date, a lump sum cash amount equal to the sum of
(i) the full Base Salary earned by the Participant  through the Termination Date
and  unpaid  at the  Termination  Date,  (ii) any  bonus  awards  earned  by the
Participant but not yet paid or credited as a deferral at the Termination  Date,
and (iii) the amount of any Base Salary  attributable  to vacation earned by the
Participant but not taken before the Termination Date.

         6.3 OTHER  AGREEMENTS.  The  Severance  Payment and the other  benefits
described in this Article 6 shall be payable in addition to, and not in lieu of,
all other accrued,  vested or deferred  compensation,  rights,  options or other
benefits  which may be owed to a  Participant  following  termination  or upon a
Change in Control,  including  but not  limited to amounts or  benefits  payable
under any  incentive  plan,  stock  option plan,  stock  ownership  plan,  stock
purchase plan,

                                       10
<PAGE>

life insurance plan, health plan,  disability plan or similar or successor plan;
provided, however, that in the event the Participant is entitled to any benefits
or  payments  upon his or her  termination  of  employment  under an  employment
agreement  with, or severance plan  maintained by, the Company,  the Participant
shall  not  be  entitled  to the  payments  and  benefits  hereunder  upon  such
termination  unless the Participant  then waives any rights that the Participant
may then have under such  employment  agreement or severance  plan in respect of
such  termination of employment.  If the  Participant  does not waive his or her
rights under such employment agreement or severance plan in accordance with this
Section 6.3, the  Participant  shall not be entitled to any payments or benefits
hereunder and shall not be bound by the Restricted  Covenants  contained herein.
In the event  that the  Participant  is  entitled  to receive  from the  Company
benefits in the nature of severance  under  applicable  law, then the amounts of
benefits  provided  hereunder  shall,  to the extent  lawful,  be reduced by the
amount of such legally-mandated benefits.

ARTICLE 7.  OTHER BENEFITS; ADDITIONAL PAYMENTS AND LIMITATIONS ON PAYMENTS

         7.1 PERFORMANCE  SHARES.  This Section 7.1 shall apply to a Participant
if and only if such Participant is a participant under the Company's Performance
Share Plan. Unless otherwise  provided in the agreement  confirming the award of
the Participant's performance shares under the Company's Performance Share Plan,
in the event that a Change in Control occurs prior to the end of an award period
with  respect  to an  award  of  performance  shares  to  the  Participant,  the
performance  shares shall be deemed to have been fully earned by the Participant
as of the  date of the  Change  in  Control,  regardless  of the  attainment  or
nonattainment of any performance target and Y&R shall pay to the Participant, no
later than thirty (30) days  following  the Change in Control,  a lump-sum  cash
payment  equal to the value of such  performance  shares.  In the event that the
Company's  Performance  Share Plan has not been terminated  prior to a Change in
Control  and an  award  of  performance  shares  has  not yet  been  made to the
Participant  under such plan in respect of the award period beginning on January
1 of the calendar year in which the Change in Control  occurs,  Y&R shall pay to
the Participant, no later than thirty (30) days following the Change in Control,
the Performance Share Amount.

         7.2 GROSS-UP PAYMENT. (a) This Section 7.2 shall apply to a Participant
if  and  only  if so  expressly  provided  in  the  Participant's  Participation
Schedule.  No Payments (as such term is defined  below) shall be made under this
Section  7.2  on or  after  a  Non-Qualifying  Termination  that  constitutes  a
termination for any reason other than as a result of the Participant's  death or
Disability.

         (b) Anything in the Plan to the contrary notwithstanding,  in the event
it shall be determined that any payment or distribution by the Company to or for
the  benefit of the  Participant,  whether  paid or payable  or  distributed  or
distributable  pursuant  to the terms of the Plan or  otherwise  (a  "Payment"),
would be  subject to the excise  tax  imposed  by Section  4999 of the  Internal
Revenue Code of 1986, as amended (the  "Code"),or  any interest or penalties are
incurred by the  Participant  with  respect to such excise tax (such excise tax,
together  with any such interest and  penalties,  are  hereinafter  collectively
referred  to as the "Excise  Tax"),  then the  Participant  shall be entitled to
receive an  additional  payment (a  "Gross-Up  Payment")  in an amount such that
after  payment  by the  Participant  of all taxes  (including  any  interest  or
penalties

                                       11
<PAGE>

imposed with respect to such taxes), including,  without limitation,  any income
or  payroll  taxes  and  Excise  Tax  imposed  upon the  Gross-Up  Payment,  the
Participant  retains an amount of the Gross-Up  Payment  equal to the Excise Tax
imposed upon the Payments.

         (c) Subject to the  provisions of Section  7.2(d),  Y&R shall cause all
determinations  required to be made under this  Section 7,  including  whether a
Gross-Up  Payment is required  and the amount of such  Gross-Up  Payment and the
assumptions not specified herein to be used in arriving at such  determinations,
to be made by the Company's independent auditors immediately prior to the Change
in Control (the "Accounting  Firm"). Y&R shall cause the Accounting Firm to make
such determination within fifteen business days after request therefor by notice
from the  Participant  or Y&R to such Firm and to the  other  party  hereto.  In
making such  determination  with respect to any matter which is  uncertain,  Y&R
shall cause the  Accounting  Firm to adopt the position  which it believes  more
likely  than not would be adopted by the  Internal  Revenue  Service.  Y&R shall
cause the  Accounting  Firm to provide  detailed  supporting  calculations  with
respect to its determination both to Y&R and the Participant within such fifteen
business day period. All fees and expenses of the Accounting Firm shall be borne
solely by the Company.  In making the  determinations  required by this Section,
the  Accounting  Firm may rely on a benefit  consultant,  selected  by it, as to
whether any of the  payments or  benefits  provided  for in Article 6 hereof are
"reasonable  compensation for personal  services  actually  rendered" within the
meaning of Section 280G(b)(4) of the Code. The Initial Gross-Up Payment, if any,
as  determined  pursuant  to this  Section  7.2(c),  shall be paid by Y&R to the
Participant  within  five days of the  receipt by Y&R of the  Accounting  Firm's
determination.  If the Accounting  Firm determines that no Excise Tax is payable
by the  Participant,  Y&R  shall  cause  the  Accounting  Firm  to  furnish  the
Participant  with a written opinion that failure to report the Excise Tax on the
Participant's  applicable  federal  income  tax  return  would not result in the
imposition  of a  negligence  or  similar  penalty.  Any  determination  by  the
Accounting Firm shall be final,  binding and conclusive upon the Company and the
Participant,  except as  provided in the  following  sentences  of this  Section
7.2(c).  As a result of  uncertainty  in the  application of Section 4999 of the
Code at the time of the initial  determination by the Accounting Firm hereunder,
it is  possible  that  Gross-Up  Payments  which  will not have been made by Y&R
should have been made (an  "Underpayment")  or that Gross-Up Payments which have
been  made by Y&R  should  not have been made (an  "Excess  Gross-Up  Payment"),
consistent with the  calculations  required to be made  hereunder.  Either party
hereto can request a redetermination by the Accounting Firm. An Underpayment can
result from a claim by the Internal  Revenue Service or from a determination  by
the  Accounting  Firm.  In the event that the Internal  Revenue  Service makes a
claim and the Company  exhausts its remedies  pursuant to Section 7.2(d) and the
Participant  thereafter  is required  to make a payment of any Excise  Tax,  Y&R
shall  cause  the  Accounting  Firm to  promptly  determine  the  amount  of the
Underpayment that has occurred and any such Underpayment  shall be promptly paid
by Y&R to or for the benefit of the Participant.  An Excess Gross-Up Payment can
result from a  determination  by the Internal  Revenue Service or the Accounting
Firm. If the Accounting Firm makes an Excess Gross-Up Payment determination, Y&R
shall  cause the  Accounting  Firm to  furnish  the  Participant  with a written
opinion that the basis for its  determination  would be accepted by the Internal
Revenue  Service  and that the  Participant  has a right to a refund of taxes or
credit  against  taxes  with  respect  to  the  Excess  Gross-Up  Payment.   The
Participant  shall  promptly  repay to Y&R an amount  equal to the  reduction in
aggregate taxes due by the Participant  resulting from such determination by the
Internal Revenue Service or the Accounting

                                       12
<PAGE>

Firm,  provided that the Participant shall only be required to repay any portion
of such amount that had been paid to the Internal  Revenue Service to the extent
that and when the  Participant  receives  a  refund  from the  Internal  Revenue
Service (or is  entitled  and able to utilize  such  amount as a credit  against
other taxes due).

         (d) The  Participant  shall  notify  Y&R in writing of any claim by the
Internal  Revenue Service that, if successful,  would require the payment by Y&R
of a Gross-Up Payment.  Such notification  shall be given as soon as practicable
but no later than ten business days after the Participant is informed in writing
of such claim and shall  apprise Y&R of the nature of such claim and the date on
which such claim is requested  to be paid.  The  Participant  shall not pay such
claim prior to the  expiration of the 30-day period  following the date on which
the  Participant  gives such notice to Y&R (or such shorter period ending on the
date that any  payment  of taxes  with  respect  to such  claim is due).  If Y&R
notifies the  Participant in writing prior to the expiration of such period that
it desires to contest such claim, the Participant shall:

                  (i) Give Y&R information  reasonably requested by Y&R relating
                  to such claim,

                  (i) Take such action in connection  with contesting such claim
                  as Y&R shall reasonably  request in writing from time to time,
                  including, without limitation,  accepting legal representation
                  with respect to such claim by an attorney  reasonably selected
                  by Y&R,

                  (iii) Cooperate with Y&R in good faith in order effectively to
                  contest such claim, and

                  (iv) Permit Y&R to participate in any proceedings  relating to
                  such claim;

provided,  however,  that Y&R shall bear and pay directly all costs and expenses
(including  additional  interest and penalties) incurred in connection with such
contest and shall indemnify and hold the Participant  harmless,  on an after-tax
basis, for any taxes,  including,  without limitation,  any Excise Tax or income
tax, including interest and penalties with respect thereto,  imposed as a result
of such representation and payment of costs and expenses.  Without limitation on
the  foregoing  provisions  of  this  Section  7.2(d),  Y&R  shall  control  all
proceedings  taken in connection with such contest and, at its sole option,  may
pursue or forego any and all administrative appeals,  proceedings,  hearings and
conferences  with the taxing  authority in respect of such claim and may, at its
sole option,  either direct the Participant to pay the tax claimed and sue for a
refund or  contest  the claim in any  permissible  manner,  and the  Participant
agrees to prosecute such contest to a  determination  before any  administrative
tribunal,  in a court  of  initial  jurisdiction  and in one or  more  appellate
courts,  as Y&R shall  determine;  provided,  however,  that if Y&R  directs the
Participant to pay such claim and sue for a refund, Y&R shall advance the amount
of  such  payment  to the  Participant,  on an  interest-free  basis  and  shall
indemnify and hold the Participant  harmless,  on an after-tax  basis,  from any
taxes, including, without limitation, any Excise Tax or income or payroll taxes,
including  interest or penalties with respect  thereto,  imposed with respect to
such advance or with respect to any imputed income with respect to such advance;
and further  provided that any extension of the statute of limitations

                                       13
<PAGE>

relating  to  payment  of taxes for the  taxable  year of the  Participant  with
respect to which such contested amount is claimed to be due is limited solely to
such  contested  amount.  Furthermore,  Y&R's  control of the  contest  shall be
limited to issues  with  respect to which a  Gross-Up  Payment  would be payable
hereunder  and the  Participant  shall be entitled to settle or contest,  as the
case may be, any other issue raised by the Internal Revenue Service or any other
taxing authority.

         (e) If, after the receipt by the  Participant of an amount  advanced by
Y&R pursuant to Section 7.2(d), the Participant  becomes entitled to receive any
refund  with  respect to such claim,  the  Participant  shall  (subject to Y&R's
complying  with the  requirements  of Section  7.2(d))  promptly  pay to Y&R the
amount of such refund (together with any interest paid or credited thereon after
taxes applicable thereto). If, after the receipt by the Participant of an amount
advanced by Y&R pursuant to Section  7.2(d),  a  determination  is made that the
Participant  shall not be entitled to any refund with  respect to such claim and
Y&R does not notify  the  Participant  in writing of its intent to contest  such
denial of refund prior to the  expiration  of 30 days after such  determination,
then such  advance  shall be forgiven and shall not be required to be repaid and
the amount of such advance shall offset,  to the extent  thereof,  the amount of
Gross-Up Payment required to be paid.

         (f)  Payments  or  distributions  by Y&R to or for the  benefit  of the
Participant  pursuant to any "incentive  stock  options"  (within the meaning of
Section 422 of the Code) granted to the Participant  which were granted prior to
the  date  of  the  Participant's  Participation  Schedule  shall  be  "Excluded
Payments."  In the event that  Payments  which  include  Excluded  Payments  are
subject to Excise Tax, the determinations  made pursuant to Section 7.2(c) above
shall be  calculated  with  respect  to all  Payments  (including  any  Excluded
Payments),  but any resulting  Gross-Up Payment required to be made by Y&R shall
be reduced by the product of the Gross-Up  Payment  multiplied by a fraction the
numerator of which is the Excluded  Payments and the denominator of which is all
Payments (including the Excluded Payments).

         7.3 LIMITS ON PAYMENTS BY THE COMPANY. (a) This Section 7.3 shall apply
to a  Participant  if and only if so  expressly  provided  in the  Participant's
Participation  Schedule.  In the  event  that  the  Participant's  Participation
Schedule provides for the application of this Section 7.3 at the election of the
Participant,  such  election  must  be  made  by  the  Participant  as  soon  as
practicable  but in any  event  no  later  than  ten  business  days  after  the
Participant is informed of the Accounting Firm's  determination that any payment
or  benefit  provided  for under  Article 6  constitutes  an  "excess  parachute
payment"  within the  meaning of  Section  280G(b)(1)  of the Code that would be
subject to Excise Tax in accordance with Section 7.3(b) below.

         (b) The payments or benefits  provided for in Article 6 hereof shall be
reduced to the extent and only to the extent  necessary  to avoid any payment or
benefit  provided for under  Article 6 from  constituting  an "excess  parachute
payment"  within the meaning of Section  280G(b)(1)  of the Code,  that would be
subject to Excise Tax. Y&R shall cause the Accounting Firm to determine  whether
any such  reduction  shall be required  pursuant to this Section 7.3 and, if any
such  reduction  is  required,  to  reduce  payments  or  benefits  in the order
specified by the Participant to the extent necessary to satisfy the requirements
of the first sentence of this Section. All determinations of the Accounting Firm
shall be  binding  on the  Company  and the  Participant.  Y&R  shall  cause the
Accounting  Firm to determine that payments or benefits shall be reduced

                                       14
<PAGE>

only to the  extent  that it is more  likely  than not  that  such  payments  or
benefits,  if not reduced,  would be "excess parachute payments" (as referred to
above)  subject to Excise  Tax.  In making the  determinations  required by this
Section,  the Accounting Firm may rely on a benefit consultant,  selected by it,
as to whether any of the  payments or benefits  provided for in Article 6 hereof
are "reasonable compensation for personal services actually rendered" within the
meaning of Section 280G(b)(4). Y&R hereby agrees to pay all fees and expenses of
the Accounting  Firm and shall  indemnify and hold the Accounting  Firm harmless
from  any  and  all  cost,  expense,  liability  or  damage  arising  out of any
determinations made by the Accounting Firm pursuant to this Section.

ARTICLE 8. WITHHOLDING TAXES

         The Company may withhold from all payments due to a Participant (or his
or her beneficiary or estate) hereunder all taxes which, by applicable  federal,
state, local or other law, the Company is required to withhold therefrom.

ARTICLE 9.  Y&R'S PAYMENT OBLIGATION; NO MITIGATION

         9.1 PAYMENT OBLIGATIONS ARE ABSOLUTE. Y&R's obligation to a Participant
to make the payments and the arrangements  provided for herein shall be absolute
and unconditional,  and shall not be affected by any  circumstances,  including,
without  limitation,  any offset,  counterclaim,  recoupment,  defense, or other
right which the Company may have against the Participant or anyone else,  except
to the extent so provided in Section  6.1(c) and Article 7, if  applicable.  All
amounts  payable by Y&R hereunder  shall be paid without notice or demand.  Each
and every  payment made  hereunder by Y&R shall be final,  and the Company shall
not seek to recover all or any part of such  payment from  Participants  or from
whomsoever may be entitled thereto.

         Participants  shall not be obligated to seek other  employment  or take
other action by way of mitigation of the amounts  payable or  arrangements  made
under any provision of the Plan, and the obtaining of any such other  employment
shall in no event effect any reduction of Y&R's obligations to make the payments
and  arrangements  required  to be made  under  the Plan,  except to the  extent
expressly provided in Section 6.1(c).

         9.2  CONTRACTUAL  RIGHTS  TO  BENEFITS.   The  Plan,  together  with  a
Participation Schedule,  establishes and vests in each Participant a contractual
right to the benefits to which he is entitled hereunder.

ARTICLE 10.  SUCCESSORS AND ASSIGNMENT

         10.1 SUCCESSORS TO Y&R. Y&R will require any successor  (whether direct
or  indirect,  by  purchase,  merger,  consolidation,  or  otherwise)  of all or
substantially  all of the  business  and/or  assets of the Company to  expressly
assume and agree to perform Y&R's obligations under the Plan.  Failure of Y&R to
obtain such  assumption  and agreement  prior to the effective  date of any such
succession  shall be a breach of the Plan and shall entitle the  Participants to
resign for Good Reason.

                                       15
<PAGE>

         10.2 ASSIGNMENT BY THE PARTICIPANT. The Plan shall inure to the benefit
of and be  enforceable by the  Participant  and each  Participant's  personal or
legal   representatives,    executors,   administrators,    successors,   heirs,
distributees,  devisees,  and legatees.  If a Participant  dies while any amount
would  still  be  payable  to the  Participant  hereunder  had  the  Participant
continued to live, all such amounts,  unless otherwise provided herein, shall be
paid in accordance with the terms of the Plan, to the Participant's Beneficiary.
If the Participant has not named a Beneficiary,  then such amounts shall be paid
to the Participant's devisee, legatee, or other designee, or if there is no such
designee, to the Participant's estate.

ARTICLE 11.  COVENANT NOT TO COMPETE; COVENANT NOT TO SOLICIT.

         (a) As a condition to  participation,  a Participant shall agree within
thirty (30) days after the date of the Participant's Participation Schedule:

                  (i) for one (1) year after the Participant's Termination Date,
                  the  Participant  shall  not  work for any  competitor  of the
                  Company on the account of any client of the Company  with whom
                  such Participant had a direct  relationship or as to which the
                  Participant had a significant  supervisory  responsibility  or
                  otherwise  was  significantly  involved at any time during the
                  two (2) years prior to such termination;

                  (ii) for six (6) months  after the  Participant's  Termination
                  Date,  with  respect  to  the   Participant   whose  principal
                  responsibilities  are of a corporate nature or for a corporate
                  department (e.g.,  finance,  tax,  treasury,  legal,  business
                  affairs,  etc.) and do not principally  involve client service
                  related  functions,  such  Participant  shall  not  work for a
                  principal competitor of the Company in a substantially similar
                  corporate  function as such  Participant held with the Company
                  during  the  two-year   period  prior  to  the   Participant's
                  Termination  Date,  or with respect to the  Participant  whose
                  principal  responsibilities  are of a client  service  related
                  nature  (e.g.,  creative,  account  management,   etc.),  such
                  Participant  shall not work for a competitor of the Company on
                  the account of any substantial competitor of any client of the
                  Company   for   which   such   Participant   had   substantial
                  responsibility   during  the  two-year  period  prior  to  the
                  Termination  Date  and  shall  not  work  directly  for such a
                  competitor of such a client;

                  (iii)  for one (1) year  after the  Participant's  Termination
                  Date, the Participant  may not directly or indirectly  solicit
                  or hire,  or assist any other person in  soliciting or hiring,
                  any   employee  of  the  Company  (as  of  the   Participant's
                  Termination  Date) or any person who, as of the  Participant's
                  Termination Date, was in the process of being recruited by the
                  Company or induce any such employee to terminate his or her or
                  her employment with the Company.

         (b) The Restrictive Covenants are in addition to any rights the Company
may have in law or at equity or under any other agreement.

                                       16
<PAGE>

         (c) As a condition to participation,  a Participant shall further agree
that it is  impossible  to measure in money the damages which will accrue to the
Company  in the  event  the  Participant  breaches  the  Restrictive  Covenants.
Therefore,  if Y&R shall  institute  any action or  proceeding  to  enforce  the
provisions  hereof,  the  Participant  shall agree to waive the claim or defense
that the Y&R has an adequate remedy at law and the  Participant  shall agree not
to assert in any such action or proceeding  the claim or defense that Y&R has an
adequate remedy at law. The foregoing shall not prejudice Y&R's right to require
the  Participant  to account for and pay over to Y&R any profit  obtained by the
Participant  as a  result  of  any  transaction  constituting  a  breach  of the
Restrictive Covenants.

ARTICLE 12.  ARBITRATION OF DISPUTES

         (a) Any disagreement,  dispute,  controversy or claim arising out of or
relating to the Plan or the  interpretation  or validity hereof shall be settled
exclusively and finally by binding  arbitration.  It is specifically  understood
and  agreed  that any  disagreement,  dispute  or  controversy  which  cannot be
resolved between the parties,  including without  limitation any matter relating
to  the   interpretation   of  the  Plan,  shall  be  submitted  to  arbitration
irrespective of the magnitude thereof, the amount in controversy or whether such
disagreement,  dispute or controversy would otherwise be considered  justifiable
or ripe for resolution by a court or arbitral tribunal.

         (b)  The  arbitration   shall  be  conducted  in  accordance  with  the
Commercial   Arbitration  Rules  (the  "Arbitration   Rules")  of  the  American
Arbitration Association (the "AAA"), except as otherwise provided below.

         (c) The arbitral tribunal shall consist of one arbitrator.  The parties
to the arbitration jointly shall directly appoint such arbitrator within 30 days
of  initiation  of the  arbitration.  If the parties  shall fail to appoint such
arbitrator as provided above,  such arbitrator  shall be appointed in accordance
with the  Arbitration  Rules of the AAA and shall be a person who (i)  maintains
his or her or her principal place of business within 30 miles of the location of
the arbitration as set forth in subparagraph (d) of this Article 12 and (ii) has
had substantial experience in mergers and acquisitions. Y&R shall pay all of the
fees, if any, and expenses of such arbitrator.

         (d)  The  arbitration  shall  be  conducted  within  30  miles  of  the
Participant's  principal  work  location,  or in such  other  city in the United
States of America as the parties to the dispute may designate by mutual  written
consent.

         (e) At any oral hearing of evidence in connection with the arbitration,
each party  thereto  or its legal  counsel  shall have the right to examine  its
witnesses and to cross-examine  the witnesses of any opposing party. No evidence
of any witness  shall be presented  unless the opposing  party or parties  shall
have the opportunity to cross-examine such witness, except as the parties to the
dispute otherwise agree in writing.

         (f) Any decision or award of the arbitral  tribunal  shall be final and
binding  upon the parties to the  arbitration  proceeding.  The  parties  hereto
hereby  waive to the  extent  permitted  by law any  rights to appeal or to seek
review of such award by any court or tribunal. The parties hereto agree that the
arbitral award may be enforced against the parties to the arbitration

                                       17
<PAGE>

proceeding  or their assets  wherever they may be found and that a judgment upon
the arbitral award may be entered in any court having jurisdiction.

         (g)  Nothing  herein  contained  shall be deemed  to give the  arbitral
tribunal any authority, power, or right to alter, change, amend, modify, add to,
or subtract from any of the provisions of the Plan.

ARTICLE 13.  LEGAL FEES

         Y&R agrees to pay, to the full extent  permitted by law, on a quarterly
basis, all legal fees and expenses which a Participant may reasonably incur as a
result of any  contest in which  there is a  reasonable  basis for the claims or
defenses  asserted by the  Participant and such claims and defenses are asserted
by the Participant in good faith  (regardless of the outcome thereof)  regarding
the validity or enforceability of, or liability under, any provision of the Plan
(including as a result of any contest by the Participant about the amount of any
payment  pursuant  to  Article  6);  provided,  however,  that Y&R  shall not be
obligated  to pay any  such  fees and  expenses,  and the  Participant  shall be
obligated to return any such fees and expenses  that were  advanced  plus simple
interest on such amount from the date of  advancement  at the 90-day US Treasury
Bill rate as in effect from time to time, compounded annually, if the arbitrator
(as provided in Article 12) determines  that the  Participant was terminated for
Cause or that the  Participant  did not have a good  faith  basis to assert  the
claim in question.

ARTICLE 14.  TRUSTS; UNFUNDED STATUS OF PLAN

         14.1  UNFUNDED  STATUS OF PLAN.  The Plan is intended to  constitute an
"unfunded" plan and Participants  shall have no claim against the Company or its
assets other than as unsecured general creditors. Notwithstanding the foregoing,
Y&R may establish a trust or purchase other property to assist it in meeting its
obligations  hereunder  as set forth in Section 14.2 below;  provided,  however,
that in no event  shall  any  Participant  have any  interest  in such  trust or
property other than as an unsecured general creditor.

         14.2 CREATION OF TRUSTS.  The Board may, in its  discretion,  authorize
the creation of one or more trusts (including sub-accounts under such trust(s)),
and deposit therein amounts of cash,  stock, or other property not exceeding the
amount of Y&R's obligations with respect to the Plan, or make other arrangements
to meet Y&R's  obligations  under the Plan,  which trusts or other  arrangements
shall be consistent with the "unfunded" status of the Plan.

ARTICLE 15.  MISCELLANEOUS

         15.1.  EMPLOYMENT  STATUS.  Except as may be  provided  under any other
agreement  between  a  Participant  and  the  Company,  the  employment  of  the
Participant by the Company is "at will." The Plan does not constitute a contract
of employment or impose on the Company any obligation to retain the  Participant
as an  employee,  to change the status of the  Participant's  employment,  or to
change the policies of the Company regarding termination of employment.

         15.2. BENEFICIARIES. Each Participant may designate one or more persons
or entities as the primary and/or contingent  Beneficiaries of any amounts owing
to the  Participant  under the

                                       18
<PAGE>

Plan. Such designation must be in the form of a signed writing acceptable to the
Board. Participants may make or change such designations at any time.

         15.3.  NUMBER.  Except where  otherwise  indicated by the context,  the
plural shall include the singular, and the singular shall include the plural.

         15.4.  SEVERABILITY.  In the event any  provision  of the Plan shall be
held illegal or invalid for any reason,  the illegality or invalidity  shall not
affect the  remaining  parts of the Plan,  and the Plan shall be  construed  and
enforced as if the illegal or invalid provision had not been included.  Further,
the captions of the Plan are not part of the provisions hereof and shall have no
force and effect.

         15.5.  MODIFICATION.  The Board may amend or modify the Plan; provided,
however,  than no  provision  of the Plan may be amended or modified in a manner
adverse to a Participant  unless such amendment or  modification is agreed to in
writing by such affected Participant.

         15.6.  APPLICABLE  LAW. To the extent not  preempted by the laws of the
United States, the laws of the State of New York shall be the controlling law in
all matters relating to the Plan.

         15.7 NOTICE. All notices and other communications required or permitted
hereunder  shall be in writing  and shall be deemed to have been duly given when
delivered or five (5) days after  deposit in the United  States mail,  certified
and return receipt requested, postage prepaid, addressed as follows:

                  If to Y&R:

                           Young & Rubicam Inc.
                           285 Madison Avenue
                           New York, NY 10017
                           Attention: General Counsel

                  If to a Participant, to the Participant's address as indicated
 on the Participant's Participation Schedule,

or to such  other  address  as either  party may have  provided  to the other in
writing in accordance  herewith,  except that notices of change of address shall
be effective only upon receipt.

         15.8 JOINT AND  SEVERAL  OBLIGATION.  If the  Participant  is  employed
during  the  Protected  Period  by one or more  entities  that  form part of the
Company,  whether or not such  Participant  is also  employed  by Y&R during the
Protected  Period,  each such  entity  shall be  jointly  and  severally  liable
together with Y&R for the obligations of Y&R to the Participant hereunder.

                                       19

<PAGE>

                         RESTRICTIVE COVENANT AGREEMENT

         This Restrictive  Covenant  Agreement dated as of ______________  (this
"Agreement"),  is made and entered into by and between  Young & Rubicam  Inc., a
Delaware corporation ("Y&R"), and ______________(the "Participant"). Capitalized
terms used herein and not otherwise  defined shall have the respective  meanings
ascribed  to them in the  Young &  Rubicam  Inc.  Change  in  Control  Plan (the
"Plan").

         WHEREAS,  the Company has  established  the Plan to provide the Company
and the Participant with certain rights and obligations upon the occurrence of a
Change in Control;

         WHEREAS,  the Board has  designated  the  Participant  as an individual
entitled  to  participate  in the  Plan  and  the  Participant  has  received  a
Participation Schedule evidencing his or her participation in the Plan;

         WHEREAS, the Participant desires to be a participant in the Plan;

         WHEREAS,  pursuant  to  Article  4  of  the  Plan,  as a  condition  to
participation in the Plan, the Participant must execute an agreement to be bound
by the Restrictive  Covenants  therein within thirty (30) days after the date of
the Participant's Participation Schedule;

         NOW,  THEREFORE,  in consideration of the premises and mutual covenants
therein contained, it is hereby agreed by and between Y&R and the Participant as
follows:

         1.  Restrictive   Covenants.   As  a  condition  to  participation,   a
Participant  shall  agree  within  thirty  (30)  days  after  the  date  of  the
Participant's Participation Schedule:

                  (i) for one (1) year after the Participant's Termination Date,
                  the  Participant  shall  not  work for any  competitor  of the
                  Company on the account of any client of the Company  with whom
                  such Participant had a direct  relationship or as to which the
                  Participant had a significant  supervisory  responsibility  or
                  otherwise  was  significantly  involved at any time during the
                  two (2) years prior to such termination;

                  (ii) for six (6) months  after the  Participant's  Termination
                  Date,  with  respect  to  the   Participant   whose  principal
                  responsibilities  are of a corporate nature or for a corporate
                  department (e.g.,  finance,  tax,  treasury,  legal,  business
                  affairs,  etc.) and do not principally  involve client service
                  related  functions,  such  Participant  shall  not  work for a
                  principal competitor of the Company in a substantially similar
                  corporate  function as such  Participant held with the Company
                  during  the  two-year   period  prior  to  the   Participant's
                  Termination  Date,  or with respect to the  Participant  whose
                  principal  responsibilities  are of a client  service  related
                  nature  (e.g.,  creative,  account  management,   etc.),  such
                  Participant  shall not work for a competitor of the Company on
                  the account of any substantial competitor of any client of the
                  Company   for   which   such   Participant   had   substantial
                  responsibility   during  the  two-year  period  prior  to  the
                  Termination  Date  and  shall  not  work  directly  for such a
                  competitor of such a client;

                  (iii)  for one (1) year  after the  Participant's  Termination
                  Date, the Participant  may not directly or indirectly  solicit
                  or hire,  or assist any other person in  soliciting or hiring,
                  any   employee  of  the  Company  (as  of  the   Participant's
                  Termination  Date) or any person who, as of the  Participant's
                  Termination Date, was in the process of being recruited by the
                  Company or induce any such  employee to  terminate  his or her
                  employment with the Company.

         2. Additional Rights of the Company. The Participant  acknowledges that
the Restrictive  Covenants are in addition to any rights the Company may have in
law or at equity or under any other agreement.

         3.  Inadequate  Remedy  at  Law.  The  Participant  agrees  that  it is
impossible  to measure in money the damages  which will accrue to the Company in
the event the Participant breaches the Restrictive Covenants.  Therefore, if Y&R
shall institute any action or proceeding to enforce the provisions  hereof,  the
Participant agrees to waive the claim or defense that Y&R has an adequate remedy
at law and the Participant agrees not to assert in any such action or proceeding
the claim or defense that Y&R has an adequate remedy at law. The foregoing shall
not prejudice Y&R's right to require the Participant to account for and pay over
to Y&R any profit  obtained by the  Participant  as a result of any  transaction
constituting a breach of the Restrictive Covenants.

         4. Severability.  In the event any provision of this Agreement shall be
held illegal or invalid for any reason,  the illegality or invalidity  shall not
affect  the  remaining  parts of this  Agreement,  and this  Agreement  shall be
construed  and  enforced  as if the  illegal or invalid  provision  had not been
included. Further, the captions of this Agreement are not part of the provisions
hereof and shall have no force and effect.

         5.  Applicable  Law.  To the  extent not  preempted  by the laws of the
United States, the laws of the State of New York shall be the controlling law in
all matters relating to the Plan.

         6.  Counterparts.  This  Agreement  may be  executed  in any  number of
counterparts and by different  parties on separate  counterparts,  each of which
counterpart,  when so executed and delivered,  shall be deemed to be an original
and all of which counterparts,  taken together, shall constitute but one and the
same Agreement.

<PAGE>

         IN WITNESS WHEREOF,  the parties have executed this Agreement as of the
date first written above.

                                                     YOUNG & RUBICAM INC.

                                                     By: ____________________

                                                     ________________________
                                                     Participant

<PAGE>
  PARTICIPATION SCHEDULE

                                     [Date]

[Name and
Address of Executive]

         We are  offering you the  opportunity  to become a  Participant  in the
Young & Rubicam Inc. Change in Control Severance Plan (the "Plan").  All defined
terms used  herein  shall have the meaning  ascribed  to them in the Plan.  As a
condition to your  participation  in the Plan, you must execute the agreement to
be bound by the Restrictive  Covenants in the form attached hereto no later than
thirty (30) days after the date hereof.

         Except as may be provided under any other agreement between you and the
Company,  your  employment  by the  Company  is "at  will."  The  Plan  does not
constitute a contract of employment  or impose on the Company any  obligation to
retain you as an employee, to change the status of your employment, or to change
the policies of the Company regarding termination of employment.

         For purposes of the Plan, your participation  shall be determined based
upon the following:

         (a)  Severance Factor: [___]
         (b)  Benefit Continuation Period: [___]
         (c)  Age Supplement: [___]
         (d)  Service Supplement: [___]

         (e)  Additional Payments:

        [The  Gross-Up  Payment  provided  under   Section  7.2  applies to  the
Participant.]1

          [The Gross-Up Payment provided under Section 7.2 does not apply to the
Participant.  The Limitation on Payment  provisions of Section 7.3 will apply to
the Participant at the Participant's election in accordance with Section 7.3.]2

         [The Gross-Up  Payment provided under Section 7.2 does not apply to the
Participant.  The  Participant's  payments  and/or  benefits  are  subject  to a
mandatory cutback to be determined in accordance with Section 7.3.]3

         [(f)  Additional Good Reason:

                  ____  (1)  Any  voluntary  termination  of  employment  by the
         Participant  with a Termination  Date during the twenty-four (24) month
         period following the Change in Control.4

                  ____  (2)  Any  voluntary  termination  of  employment  by the
         Participant with a Termination Date during the 30 day period commencing
         on the first anniversary of the Change in Control.]5

                                                     Young & Rubicam Inc.6

By:   __________________________

_________________________________
1        Insert Tier 1
2        Insert Tier 2
3        Insert Tier 3
4        Insert Tier 1
5        Insert Tier 2
6        If the Participant is employed by an entity other than Y&R Inc., add a
signature for that entity as well.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00006-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00006-of-00352.parquet"}]]