ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
☒ | Accelerated filer | ¨ | ||||
Non-accelerated filer | ¨ | Smaller reporting company | ||||
Emerging growth company |
Page | ||
Item 1. | ||
Item 1A. | ||
Item 1B. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
Item 5. | ||
Item 6. | ||
Item 7. | ||
Item 7A. | ||
Item 8. | ||
Item 9. | ||
Item 9A. | ||
Item 9B. | ||
Item 10. | ||
Item 11. | ||
Item 12. | ||
Item 13. | ||
Item 14. | ||
Item 15. | ||
Item 16. |
• | potential effects of a challenging economy, for example, on the demand for our advertising and marketing services, on our clients’ financial condition and on our business or financial condition; |
• | our ability to attract new clients and retain existing clients; |
• | our ability to retain and attract key employees; |
• | risks associated with assumptions we make in connection with our critical accounting estimates, including changes in assumptions associated with any effects of a weakened economy; |
• | potential adverse effects if we are required to recognize impairment charges or other adverse accounting-related developments; |
• | risks associated with the effects of global, national and regional economic and political conditions, including counterparty risks and fluctuations in economic growth rates, interest rates and currency exchange rates; |
• | developments from changes in the regulatory and legal environment for advertising and marketing and communications services companies around the world; and |
• | failure to realize the anticipated benefits of the acquisition of the Acxiom business. |
Item 1. | Business |
• | Media, Data and Technology offerings provide strategic media planning and buying services as well as data management and leading marketing technology services. Our media services agencies manage tens of billions of dollars in marketing investment on behalf of their clients, providing strategic counsel and advisory services to navigate the fast-evolving consumer and media landscape. Full-service global media agencies within the Mediabrands network include UM and Initiative. Additional leading brands and specialist business units include Healix, IPG Media Lab, MAGNA, Orion Holdings, Rapport and Reprise. Media solutions are developed and executed through integrated, data-driven marketing strategies. Acxiom, which IPG acquired in 2018, provides the data foundation for many of the world’s largest and most sophisticated marketers. Acxiom's solutions help clients organize, cleanse and store data in a responsible and ethical manner, and enhances our ability to provide data-driven marketing insights to our clients. Kinesso, the marketing technology company IPG launched in October of 2019, provides the tools and services required to help marketers make traditional and addressable media activation faster, better and more effective through the use of data. |
• | McCann Worldgroup is a leading global marketing solutions network united across 100+ countries by a single vision: to help brands play a meaningful role in people's lives. McCann was recognized by Cannes Lions as the 2019 Network of |
• | FCB is a global marketing communications company, named to the Ad Age Agency A-List in 2019. Based on an understanding of diversified markets and cultures, FCB focuses on creating “Never Finished” ideas for clients that reflect each brand’s past and anticipate its future. FCB also offers a range of best-in-class, integrated and specialist marketing capabilities: FCB Health, one of the world’s most awarded healthcare marketing networks; shopper-first agency FCB/RED; design agency Chute Gerdeman; experiential agency FCBX; production studios Lord + Thomas and FuelContent; CRM agency FCB/SIX; and digital agency New Honor Society. |
• | MullenLowe Group is a creatively driven integrated marketing communications network with a strong entrepreneurial heritage and challenger mentality. A global creative boutique of distinctive diverse agencies, MullenLowe Group is networked in more than 65 markets. Within the Group's distinctive hyperbundled-operating model, global specializations include expertise in brand strategy, and through-the-line advertising with MullenLowe; digital transformation with MullenLowe Profero; media and communications planning and buying with Mediahub; customer experience activation with MullenLowe Open; and consumer and corporate PR with MullenLowe PR and MullenLowe salt. The group is focused on delivering an “Unfair Share of Attention” for clients and is consistently ranked among the most awarded creative and effective agency networks in the world. Mediahub was named Ad Age Media Agency of the Year in 2019. |
• | Our CMG group has exceptional global marketing specialists across a range of disciplines, including industry-leading public relations agencies such as Weber Shandwick, Golin, DeVries Global, Axis, and Current Global have expertise in every significant area of communication management. Jack Morton is a global brand experience agency, and FutureBrand is a leading brand consultancy. Octagon is a global sports, entertainment and lifestyle marketing agency. |
• | Our domestic integrated independent and digital specialist agencies include some of advertising's most recognizable and storied agency brands, including Carmichael Lynch, Deutsch, Hill Holliday, Huge, R/GA and The Martin Agency. The marketing programs created by these agencies incorporate all media channels, CRM, public relations and other digital marketing activities and have helped build some of the most powerful brands in the U.S., across all sectors and industries. |
• | Investment in leading talent: We believe our continued ability to attract and develop top talent and to be the industry’s employer of choice for an increasingly diverse workforce have been key differentiators for IPG. We continue to acquire and develop top strategic, creative and digital talent from a range of backgrounds. |
• | Growing digital capabilities: Our investments in talent and technology - organically growing digital capabilities such as search, social, user experience (UX), content creation, analytics, and mobile across the portfolio - promise to drive further growth in this dynamic sector of our business. We continue to internationalize our powerful digital specialist agencies. |
• | Data-fueled offerings: Media and marketing is increasingly centered around the ability to manage data to create deeper direct customer relationships. Acxiom provides the tools to help our clients connect with individual consumers at scale. Kinesso furthers this vision by bringing together top data and technology talent with addressable media experts to develop software that amplifies clients' marketing and leverages Acxiom’s assets and capabilities. |
• | Investments in emerging and strategic markets: We strengthen our position in global markets by driving organic growth as well as completing strategic acquisitions in Asia, the U.K., Europe, Latin America, and North America. |
• | Integrated marketing solutions: A differentiating aspect of our business is our utilization of “open architecture” solutions that integrate the best talent from throughout the organization to fulfill the needs of our clients. |
Consolidated Total Revenues for the Three Months Ended | |||||||||||||||||
2019 | 2018 | 2017 | |||||||||||||||
(Amounts in Millions) | % of Total | % of Total | % of Total | ||||||||||||||
March 31 | $ | 2,361.2 | 23.0% | $ | 2,169.1 | 22.3% | $ | 2,063.8 | 22.8% | ||||||||
June 30 | 2,520.2 | 24.7% | 2,391.8 | 24.6% | 2,185.8 | 24.2% | |||||||||||
September 30 | 2,438.1 | 23.9% | 2,297.5 | 23.7% | 2,208.2 | 24.4% | |||||||||||
December 31 | 2,901.8 | 28.4% | 2,856.0 | 29.4% | 2,589.8 | 28.6% | |||||||||||
$ | 10,221.3 | $ | 9,714.4 | $ | 9,047.6 |
Name | Age | Office | ||
Michael I. Roth 1 | 74 | Chairman of the Board and Chief Executive Officer | ||
Andrew Bonzani | 56 | Executive Vice President, General Counsel and Secretary | ||
Christopher F. Carroll | 53 | Senior Vice President, Controller and Chief Accounting Officer | ||
Julie M. Connors | 48 | Senior Vice President, Audit and Chief Risk Officer | ||
Ellen Johnson | 54 | Executive Vice President and Chief Financial Officer | ||
Philippe Krakowsky | 57 | Executive Vice President and Chief Operating Officer |
1 | Also a Director |
Item 1A. | Risk Factors |
• | We operate in a highly competitive industry. |
• | Clients may terminate or reduce their relationships with us on short notice. |
• | Our results of operations are highly susceptible to unfavorable economic conditions. |
• | We may lose or fail to attract and retain key employees and management personnel. |
• | If our clients experience financial distress, or seek to change or delay payment terms, it could negatively affect our own financial position and results. |
• | International business risks could adversely affect our operations. |
• | We are subject to industry regulations and other legal or reputational risks that could restrict our activities or negatively impact our performance or financial condition. |
• | We face risks associated with our acquisitions and other investments. |
• | We rely extensively on information technology systems and could face cybersecurity risks. |
• | Our earnings would be adversely affected if we were required to recognize asset impairment charges or increase our deferred tax valuation allowances. |
• | We may not be able to meet our performance targets and milestones. |
• | Our financial condition could be adversely affected if our available liquidity is insufficient. |
• | In connection with the Acxiom acquisition, we incurred a substantial amount of additional debt. |
• | Downgrades of our credit ratings could adversely affect us. |
• | The costs of compliance with sustainability or other social responsibility laws, regulations or policies, including client-driven policies and standards, could adversely affect our business. |
Item 1B. | Unresolved Staff Comments |
Item 2. | Properties |
Item 3. | Legal Proceedings |
Item 4. | Mine Safety Disclosures |
Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
Total Number of Shares (or Units) Purchased | Average Price Paid per Share (or Unit) | Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs | Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs 1 | ||||||||||
October 1 - 31 | — | $ | — | — | $ | 338,421,933 | |||||||
November 1 - 30 | — | $ | — | — | $ | 338,421,933 | |||||||
December 1 - 31 | — | $ | — | — | $ | 338,421,933 | |||||||
Total | — | $ | — | — |
1 | In February 2017, the Board authorized a share repurchase program to repurchase from time to time up to $300.0 million, excluding fees, of our common stock (the "2017 Share Repurchase Program"). In February 2018, the Board authorized a share repurchase program to repurchase from time to time up to $300.0 million, excluding fees, of our common stock, which was in addition to any amounts remaining under the 2017 Share Repurchase Program. On July 2, 2018, in connection with the announcement of the Acxiom acquisition, we announced that share repurchases will be suspended for a period of time in order to reduce the increased debt levels incurred in conjunction with the acquisition, and no shares were repurchased pursuant to the share repurchase programs in the periods reflected. There are no expiration dates associated with the share repurchase programs. |
Item 6. | Selected Financial Data |
Years ended December 31, | |||||||||||||||||||
Statement of Operations Data | 2019 | 2018 1 | 2017 | 2016 | 2015 | ||||||||||||||
Revenue: | |||||||||||||||||||
Net revenue | $ | 8,625.1 | $ | 8,031.6 | $ | 7,473.5 | $ | 7,452.3 | N/A | ||||||||||
Billable expenses | 1,596.2 | 1,682.8 | 1,574.1 | 1,603.9 | N/A | ||||||||||||||
Total Revenue | 10,221.3 | 9,714.4 | 9,047.6 | 9,056.2 | $ | 7,613.8 | |||||||||||||
Operating Expenses: | |||||||||||||||||||
Salaries and related expenses | 5,568.8 | 5,298.3 | 4,990.7 | 4,942.2 | 4,765.8 | ||||||||||||||
Office and other direct expenses 2 | 1,564.1 | 1,355.1 | 1,269.2 | 1,274.6 | 1,683.3 | ||||||||||||||
Billable expenses | 1,596.2 | 1,682.8 | 1,574.1 | 1,603.9 | N/A | ||||||||||||||
Cost of services 2 | 8,729.1 | 8,336.2 | 7,834.0 | 7,820.7 | 6,449.1 | ||||||||||||||
Selling, general and administrative expenses 3 | 93.8 | 166.5 | 118.5 | 138.6 | 133.8 | ||||||||||||||
Depreciation and amortization 4 | 278.5 | 202.9 | 157.1 | 160.2 | 156.9 | ||||||||||||||
Restructuring charges 5 | 33.9 | 0.0 | (0.4 | ) | 0.3 | (0.8 | ) | ||||||||||||
Total operating expenses | 9,135.3 | 8,705.6 | 8,109.2 | 8,119.8 | 6,739.0 | ||||||||||||||
Operating income | 1,086.0 | 1,008.8 | 938.4 | 936.4 | 874.8 | ||||||||||||||
Provision for income taxes 6 | 204.8 | 199.2 | 271.3 | 196.9 | 282.8 | ||||||||||||||
Net income 7 | 673.9 | 637.7 | 570.4 | 629.0 | 480.5 | ||||||||||||||
Net income available to IPG common stockholders 7 | 656.0 | 618.9 | 554.4 | 605.0 | 454.6 | ||||||||||||||
Earnings per share available to IPG common stockholders: | |||||||||||||||||||
Basic 8 | $ | 1.70 | $ | 1.61 | $ | 1.42 | $ | 1.52 | $ | 1.11 | |||||||||
Diluted 8 | $ | 1.68 | $ | 1.59 | $ | 1.40 | $ | 1.48 | $ | 1.09 | |||||||||
Weighted-average number of common shares outstanding: | |||||||||||||||||||
Basic | 386.1 | 383.3 | 389.6 | 397.9 | 408.1 | ||||||||||||||
Diluted | 391.2 | 389.0 | 397.3 | 408.0 | 415.7 | ||||||||||||||
Dividends declared per common share | $ | 0.94 | $ | 0.84 | $ | 0.72 | $ | 0.60 | $ | 0.48 | |||||||||
Other Financial Data | |||||||||||||||||||
Net cash provided by operating activities | $ | 1,529.2 | $ | 565.1 | $ | 881.8 | $ | 512.8 | $ | 688.5 | |||||||||
As of December 31, | |||||||||||||||||||
Balance Sheet Data | 2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||
Cash and cash equivalents and marketable securities | $ | 1,192.2 | $ | 673.5 | $ | 791.0 | $ | 1,100.6 | $ | 1,509.7 | |||||||||
Total assets | 17,751.9 | 15,620.3 | 12,704.7 | 12,511.8 | 12,585.1 | ||||||||||||||
Total debt | 3,326.3 | 3,734.0 | 1,372.5 | 1,690.3 | 1,745.1 | ||||||||||||||
Total liabilities | 14,761.6 | 13,019.6 | 10,206.3 | 10,168.6 | 10,331.4 | ||||||||||||||
Total stockholders’ equity | 2,825.6 | 2,432.8 | 2,246.3 | 2,090.4 | 2,001.8 |
1 | On October 1, 2018, the Company completed its acquisition of Acxiom. See Note 6 in Item 8, Financial Statements and Supplementary Data, for further detail on the acquisition. |
2 | Results for the years ended December 31, 2017, 2016 and 2015 have been recast to conform to the current-period presentation. |
3 | The year ended December 31, 2018 included transaction costs directly related to the acquisition of Acxiom of $35.0. |
4 | The years ended December 31, 2019, 2018, 2017, 2016 and 2015 included amortization of acquired intangibles of $86.0, $37.6, $21.1, $21.9 and $26.1, respectively. |
5 | In the first quarter of 2019, the Company implemented a cost initiative to better align our cost structure with our revenue primarily related to specific client losses occurring in 2018. See Note 11 in Item 8, Financial Statements and Supplementary Data, for further detail regarding the restructuring charges. |
6 | The year ended December 31, 2019 included a benefit of $16.9 related to amortization of acquired intangibles, a benefit of $7.6 related to Q1 2019 restructuring charges, a benefit of $0.4 related to net losses on the sale of businesses, and a benefit of $39.2 related to the net impact of various discrete tax items. The year ended December 31, 2018 included a benefit of $12.1 from transaction costs directly related to the acquisition of Acxiom, a benefit of $23.4 related to the net impact of various discrete tax items, and a benefit of $4.8 related to amortization of acquired intangibles. The year ended December 31, 2017 primarily included a benefit of $36.0 related to the net effect of the Tax Cuts and Jobs Act. The year ended December 31, 2016 primarily included a net reversal of valuation allowances of $12.2, a benefit of $23.4 related to the conclusion and settlement of a tax examination of previous years and a benefit of $44.6 related to refunds to be claimed on future amended U.S. federal returns. |
7 | The years ended December 31, 2019, 2018, 2017, 2016 and 2015 included after-tax losses of $45.9, $59.7, $16.7, $39.0 and $47.1, respectively, on sales of businesses. The year ended December 31, 2018 included after-tax transaction costs directly related to the acquisition of Acxiom of $36.5. |
8 | Refer to "Earnings Per Share" in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, for further detail on the basic and diluted earnings per share impacts for the years ended December 31, 2019, 2018, and 2017. Basic and diluted earnings per share for the year ended December 31, 2016 included a positive impact of $0.20 per share from various discrete tax items, partially offset by a negative impact of $0.10 from losses on sales of businesses and the classification of certain assets as held for sale and $0.05 from the amortization of acquired intangibles. Basic and diluted earnings per share for the year ended December 31, 2015 included a negative impact of $0.12 per share from losses on sales of businesses. |
Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Years ended December 31, | Change | ||||||||||||||||
2019 vs 2018 | 2018 vs 2017 | ||||||||||||||||
Statement of Operations Data | 2019 | 2018 | 2017 | % Increase/ (Decrease) | % Increase/ (Decrease) | ||||||||||||
REVENUE: | |||||||||||||||||
Net revenue | $ | 8,625.1 | $ | 8,031.6 | $ | 7,473.5 | 7.4 | % | 7.5 | % | |||||||
Billable expenses | 1,596.2 | 1,682.8 | 1,574.1 | (5.1 | )% | 6.9 | % | ||||||||||
Total revenue | $ | 10,221.3 | $ | 9,714.4 | $ | 9,047.6 | 5.2 | % | 7.4 | % | |||||||
OPERATING INCOME 1, 2 | $ | 1,086.0 | $ | 1,008.8 | $ | 938.4 | 7.7 | % | 7.5 | % | |||||||
EBITA 1, 2, 3 | $ | 1,172.0 | $ | 1,046.4 | $ | 959.5 | 12.0 | % | 9.1 | % | |||||||
NET INCOME AVAILABLE TO IPG COMMON STOCKHOLDERS | $ | 656.0 | $ | 618.9 | $ | 554.4 | |||||||||||
Earnings per share available to IPG common stockholders: | |||||||||||||||||
Basic 1, 2 | $ | 1.70 | $ | 1.61 | $ | 1.42 | |||||||||||
Diluted 1, 2 | $ | 1.68 | $ | 1.59 | $ | 1.40 | |||||||||||
Operating Ratios | |||||||||||||||||
Organic change in net revenue | 3.3 | % | 5.5 | % | 1.5 | % | |||||||||||
Operating margin on net revenue 1, 2 | 12.6 | % | 12.6 | % | 12.6 | % | |||||||||||
Operating margin on total revenue 1, 2 | 10.6 | % | 10.4 | % | 10.4 | % | |||||||||||
EBITA margin on net revenue 1, 2, 3 | 13.6 | % | 13.0 | % | 12.8 | % | |||||||||||
Expenses as a % of net revenue: | |||||||||||||||||
Salaries and related expenses | 64.6 | % | 66.0 | % | 66.8 | % | |||||||||||
Office and other direct expenses | 18.1 | % | 16.9 | % | 17.0 | % | |||||||||||
Selling, general and administrative expenses 1 | 1.1 | % | 2.1 | % | 1.6 | % | |||||||||||
Depreciation and amortization | 3.2 | % | 2.5 | % | 2.1 | % | |||||||||||
Restructuring charges 2 | 0.4 | % | 0.0 | % | 0.0 | % |
1 | In 2018, results include transaction costs of $35.0 related to the Acxiom acquisition. |
2 | In 2019, results include restructuring charges of $33.9. See "Restructuring Charges" in MD&A and Note 11 of Item 8, Financial Statements and Supplementary Data for further information. |
3 | EBITA is a financial measure that is not defined by U.S. GAAP. EBITA is calculated as net income available to IPG common stockholder before provision for incomes taxes, total (expenses) and other income, equity in net income (loss) of unconsolidated affiliates, net income attributable to noncontrolling interests and amortization of acquired intangibles. Refer to the Non-GAAP Financial Measure section of this MD&A for additional information and for a reconciliation to U.S. GAAP measures. |
Year ended December 31, 2018 | Components of Change | Year ended December 31, 2019 | Change | ||||||||||||||||||||||
Foreign Currency | Net Acquisitions/ (Divestitures) | Organic | Organic | Total | |||||||||||||||||||||
Consolidated | $ | 8,031.6 | $ | (143.1 | ) | $ | 467.8 | $ | 268.8 | $ | 8,625.1 | 3.3 | % | 7.4 | % | ||||||||||
Domestic | 4,825.0 | 0.0 | 469.9 | 91.2 | 5,386.1 | 1.9 | % | 11.6 | % | ||||||||||||||||
International | 3,206.6 | (143.1 | ) | (2.1 | ) | 177.6 | 3,239.0 | 5.5 | % | 1.0 | % | ||||||||||||||
United Kingdom | 711.7 | (32.0 | ) | 20.8 | 26.5 | 727.0 | 3.7 | % | 2.1 | % | |||||||||||||||
Continental Europe | 737.5 | (40.6 | ) | (8.4 | ) | 53.9 | 742.4 | 7.3 | % | 0.7 | % | ||||||||||||||
Asia Pacific | 896.8 | (26.2 | ) | (9.9 | ) | (2.4 | ) | 858.3 | (0.3 | )% | (4.3 | )% | |||||||||||||
Latin America | 350.1 | (34.4 | ) | (2.1 | ) | 76.3 | 389.9 | 21.8 | % | 11.4 | % | ||||||||||||||
Other | 510.5 | (9.9 | ) | (2.5 | ) | 23.3 | 521.4 | 4.6 | % | 2.1 | % |
Year ended December 31, 2017 | Components of Change | Year ended December 31, 2018 | Change | ||||||||||||||||||||||
Foreign Currency | Net Acquisitions/ (Divestitures) | Organic | Organic | Total | |||||||||||||||||||||
Consolidated | $ | 7,473.5 | $ | 15.9 | $ | 128.2 | $ | 414.0 | $ | 8,031.6 | 5.5 | % | 7.5 | % | |||||||||||
Domestic | 4,458.8 | 0.0 | 139.9 | 226.3 | 4,825.0 | 5.1 | % | 8.2 | % | ||||||||||||||||
International | 3,014.7 | 15.9 | (11.7 | ) | 187.7 | 3,206.6 | 6.2 | % | 6.4 | % | |||||||||||||||
United Kingdom | 613.1 | 24.1 | 15.3 | 59.2 | 711.7 | 9.7 | % | 16.1 | % | ||||||||||||||||
Continental Europe | 687.8 | 27.8 | (14.7 | ) | 36.6 | 737.5 | 5.3 | % | 7.2 | % | |||||||||||||||
Asia Pacific | 866.9 | (2.0 | ) | (2.0 | ) | 33.9 | 896.8 | 3.9 | % | 3.4 | % | ||||||||||||||
Latin America | 350.8 | (35.6 | ) | (6.1 | ) | 41.0 | 350.1 | 11.7 | % | (0.2 | )% | ||||||||||||||
Other | 496.1 | 1.6 | (4.2 | ) | 17.0 | 510.5 | 3.4 | % | 2.9 | % |
Years ended December 31, | Change | ||||||||||||||||
2019 vs 2018 | 2018 vs 2017 | ||||||||||||||||
2019 | 2018 | 2017 | % Increase/ (Decrease) | % Increase/ (Decrease) | |||||||||||||
Salaries and related expenses | $ | 5,568.8 | $ | 5,298.3 | $ | 4,990.7 | 5.1 | % | 6.2 | % | |||||||
As a % of net revenue: | |||||||||||||||||
Salaries and related expenses | 64.6 | % | 66.0 | % | 66.8 | % | |||||||||||
Base salaries, benefits and tax | 54.5 | % | 54.9 | % | 56.1 | % | |||||||||||
Incentive expense | 3.3 | % | 3.7 | % | 3.3 | % | |||||||||||
Severance expense | 0.6 | % | 0.9 | % | 1.0 | % | |||||||||||
Temporary help | 4.1 | % | 4.2 | % | 3.9 | % | |||||||||||
All other salaries and related expenses | 2.1 | % | 2.3 | % | 2.5 | % |
Years ended December 31, | Change | ||||||||||||||||
2019 vs 2018 | 2018 vs 2017 | ||||||||||||||||
2019 | 2018 | 2017 | % Increase/ (Decrease) | % Increase/ (Decrease) | |||||||||||||
Office and other direct expenses | $ | 1,564.1 | $ | 1,355.1 | $ | 1,269.2 | 15.4 | % | 6.8 | % | |||||||
As a % of net revenue: | |||||||||||||||||
Office and other direct expenses | 18.1 | % | 16.9 | % | 17.0 | % | |||||||||||
Occupancy expense | 6.3 | % | 6.5 | % | 6.8 | % | |||||||||||
All other office and other direct expenses 1 | 11.8 | % | 10.4 | % | 10.2 | % |
1 | Includes production expenses, travel and entertainment, professional fees, spending to support new business activity, telecommunications, office supplies, bad debt expense, adjustments to contingent acquisition obligations, foreign currency losses (gains) and other expenses. |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Severance and termination costs | $ | 22.0 | $ | 0.0 | $ | 0.0 | |||||
Lease restructuring costs | 11.9 | 0.0 | (0.4 | ) | |||||||
Total restructuring charges | $ | 33.9 | $ | 0.0 | $ | (0.4 | ) |
Restructuring Charges | Headcount Reduction (Actual Number) | |||||
Domestic | $ | 26.3 | 507 | |||
International | 7.6 | 120 | ||||
Consolidated | $ | 33.9 | 627 |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Cash interest on debt obligations | $ | (188.3 | ) | $ | (118.4 | ) | $ | (81.9 | ) | ||
Non-cash interest | (11.0 | ) | (4.6 | ) | (8.9 | ) | |||||
Interest expense | (199.3 | ) | (123.0 | ) | (90.8 | ) | |||||
Interest income | 34.5 | 21.8 | 19.4 | ||||||||
Net interest expense | (164.8 | ) | (101.2 | ) | (71.4 | ) | |||||
Other expense, net | (42.9 | ) | (69.6 | ) | (26.2 | ) | |||||
Total (expenses) and other income | $ | (207.7 | ) | $ | (170.8 | ) | $ | (97.6 | ) |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Net losses on sales of businesses | $ | (43.4 | ) | $ | (61.9 | ) | $ | (24.1 | ) | ||
Other | 0.5 | (7.7 | ) | (2.1 | ) | ||||||
Total other expense, net | $ | (42.9 | ) | $ | (69.6 | ) | $ | (26.2 | ) |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Income before income taxes | $ | 878.3 | $ | 838.0 | $ | 840.8 | |||||
Provision for income taxes | $ | 204.8 | $ | 199.2 | $ | 271.3 | |||||
Effective income tax rate | 23.3 | % | 23.8 | % | 32.3 | % |
Year ended December 31, 2018 1 | Components of Change | Year ended December 31, 2019 | Change | ||||||||||||||||||||||
Foreign Currency | Net Acquisitions/ (Divestitures) | Organic | Organic | Total | |||||||||||||||||||||
Consolidated | $ | 6,767.5 | $ | (124.5 | ) | $ | 465.5 | $ | 239.7 | $ | 7,348.2 | 3.5 | % | 8.6 | % | ||||||||||
Domestic | 4,000.4 | 0.0 | 471.6 | 85.5 | 4,557.5 | 2.1 | % | 13.9 | % | ||||||||||||||||
International | 2,767.1 | (124.5 | ) | (6.1 | ) | 154.2 | 2,790.7 | 5.6 | % | 0.9 | % |
Year ended December 31, 2017 | Components of Change | Year ended December 31, 2018 1 | Change | ||||||||||||||||||||||
Foreign Currency | Net Acquisitions/ (Divestitures) 1 | Organic | Organic | Total 1 | |||||||||||||||||||||
Consolidated | $ | 6,266.7 | $ | 6.9 | $ | 120.6 | $ | 373.3 | $ | 6,767.5 | 6.0 | % | 8.0 | % | |||||||||||
Domestic | 3,660.6 | 0.0 | 139.8 | 200.0 | 4,000.4 | 5.5 | % | 9.3 | % | ||||||||||||||||
International | 2,606.1 | 6.9 | (19.2 | ) | 173.3 | 2,767.1 | 6.6 | % | 6.2 | % |
Years ended December 31, | Change | ||||||||||||||||
2019 | 2018 | 2017 | 2019 vs 2018 | 2018 vs 2017 | |||||||||||||
Segment EBITA 1, 2 | $ | 1,110.4 | $ | 1,042.1 | $ | 891.7 | 6.6 | % | 16.9 | % | |||||||
EBITA margin on net revenue 1, 2 | 15.1 | % | 15.4 | % | 14.2 | % |
1 | Segment EBITA and EBITA margin on net revenue include $27.6 of restructuring charges in the year ended December 31, 2019. See "Restructuring Charges" in MD&A and Note 11 of Item 8, Financial Statements and Supplementary Data for further information. |
2 | Results for the year ended December 31, 2018 have been recast to conform to the current-period presentation. |
Year ended December 31, 2018 | Components of Change | Year ended December 31, 2019 | Change | ||||||||||||||||||||||
Foreign Currency | Net Acquisitions/ (Divestitures) | Organic | Organic | Total | |||||||||||||||||||||
Consolidated | $ | 1,264.1 | $ | (18.6 | ) | $ | 2.3 | $ | 29.1 | $ | 1,276.9 | 2.3 | % | 1.0 | % | ||||||||||
Domestic | 824.6 | 0.0 | (1.7 | ) | 5.7 | 828.6 | 0.7 | % | 0.5 | % | |||||||||||||||
International | 439.5 | (18.6 | ) | 4.0 | 23.4 | 448.3 | 5.3 | % | 2.0 | % |
Year ended December 31, 2017 | Components of Change | Year ended December 31, 2018 | Change | ||||||||||||||||||||||
Foreign Currency | Net Acquisitions/ (Divestitures) | Organic | Organic | Total | |||||||||||||||||||||
Consolidated | $ | 1,206.8 | $ | 9.0 | $ | 7.6 | $ | 40.7 | $ | 1,264.1 | 3.4 | % | 4.7 | % | |||||||||||
Domestic | 798.2 | 0.0 | 0.1 | 26.3 | 824.6 | 3.3 | % | 3.3 | % | ||||||||||||||||
International | 408.6 | 9.0 | 7.5 | 14.4 | 439.5 | 3.5 | % | 7.6 | % |
Years ended December 31, | Change | ||||||||||||||||
2019 | 2018 | 2017 | 2019 vs 2018 | 2018 vs 2017 | |||||||||||||
Segment EBITA 1 | $ | 163.4 | $ | 180.3 | $ | 194.4 | (9.4 | )% | (7.3 | )% | |||||||
EBITA margin 1 | 12.8 | % | 14.3 | % | 16.1 | % |
1 | Segment EBITA and EBITA margin on net revenue include $5.6 of restructuring charges in the year ended December 31, 2019. See "Restructuring Charges" in MD&A and Note 11 of Item 8, Financial Statements and Supplementary Data for further information. |
Years ended December 31, | |||||||||||
Cash Flow Data | 2019 | 2018 | 2017 | ||||||||
Net income, adjusted to reconcile to net cash provided by operating activities 1 | $ | 1,115.0 | $ | 1,013.0 | $ | 852.1 | |||||
Net cash provided by (used in) working capital 2 | 442.8 | (431.1 | ) | 5.3 | |||||||
Changes in other non-current assets and liabilities 3 | (28.6 | ) | (16.8 | ) | 24.4 | ||||||
Net cash provided by operating activities | $ | 1,529.2 | $ | 565.1 | $ | 881.8 | |||||
Net cash used in investing activities | (161.7 | ) | (2,491.5 | ) | (196.2 | ) | |||||
Net cash (used in) provided by financing activities | (843.0 | ) | 1,853.2 | (1,004.9 | ) |
1 | Reflects net income adjusted primarily for depreciation and amortization of fixed assets and intangible assets, amortization of restricted stock and other non-cash compensation, net losses on sales of businesses and deferred income taxes. |
2 | Reflects changes in accounts receivable, accounts receivable billable to clients, other current assets, accounts payable and accrued liabilities. |
3 | Reflects changes in operating lease right-of-use assets and lease liabilities and other non-current assets and liabilities. |
• | Debt service – Our 3.50% Senior Notes in aggregate principal amount of $500.0 mature on October 1, 2020. We expect to use available cash as well as commercial paper as needed to fund the principal repayment. As of December 31, 2019, we had outstanding short-term borrowings of $52.4 from our uncommitted lines of credit used primarily to fund short-term working capital needs. The remainder of our debt is primarily long-term, with maturities scheduled from 2021 through 2048. On October 1, 2018, in order to fund the acquisition of Acxiom, we entered into financing arrangements with third-party lenders under a three-year term loan agreement (the "Term Loan Agreement"). We fully paid off the outstanding balance under the Term Loan Agreement as of December 31, 2019, with payments of $100.0, $200.0 and $100.0, on June 13, 2019, September 9, 2019 and December 12, 2019, respectively. See Note 4 in Item 8, Financial Statements and Supplementary Data for further information. |
• | Acquisitions – We paid cash of $0.6 for an acquisition completed in 2019. We also paid $25.1 in deferred payments for prior-year acquisitions as well as ownership increases in our consolidated subsidiaries. In addition to potential cash expenditures for new acquisitions, we expect to pay approximately $46.0 in 2020 related to prior-year acquisitions. We may also be required to pay approximately $21.0 in 2020 related to put options held by minority shareholders if exercised. We will continue to evaluate strategic opportunities to grow and continue to strengthen our market position, particularly in our digital and marketing services offerings, and to expand our presence in high-growth and key strategic world markets. |
• | Dividends – During 2019, we paid four quarterly cash dividends of $0.235 per share on our common stock, which corresponded to aggregate dividend payments of $363.1. On February 12, 2020, we announced that our Board of Directors (the "Board") had declared a common stock cash dividend of $0.255 per share, payable on March 16, 2020 to holders of record as of the close of business on March 2, 2020. Assuming we pay a quarterly dividend of $0.255 per share and there is no significant change in the number of outstanding shares as of December 31, 2019, we would expect to pay approximately $395.0 over the next twelve months. |
Years ended December 31, | Thereafter | Total | |||||||||||||||||||||||||
2020 | 2021 | 2022 | 2023 | 2024 | |||||||||||||||||||||||
Long-term debt 1 | $ | 502.0 | $ | 501.4 | $ | 248.9 | $ | 498.3 | $ | 497.8 | $ | 1,025.5 | $ | 3,273.9 | |||||||||||||
Interest payments on long-term debt 1 | 134.2 | 116.4 | 93.9 | 73.6 | 56.4 | 728.6 | 1,203.1 | ||||||||||||||||||||
Non-cancelable operating lease obligations 2 | 333.5 | 300.7 | 267.5 | 209.7 | 183.5 | 716.1 | 2,011.0 | ||||||||||||||||||||
Contingent acquisition payments 3 | 71.9 | 68.3 | 39.8 | 10.6 | 4.9 | 0.2 | 195.7 | ||||||||||||||||||||
Uncertain tax positions 4 | 14.0 | 169.8 | 35.7 | 81.6 | 29.8 | 14.4 | 345.3 | ||||||||||||||||||||
Total | $ | 1,055.6 | $ | 1,156.6 | $ | 685.8 | $ | 873.8 | $ | 772.4 | $ | 2,484.8 | $ | 7,029.0 |
1 | Amounts represent maturity at book value and interest payments based on contractual obligations. We may at our option and at any time redeem all or some of any outstanding series of our senior notes reflected in this table at the redemption prices set forth in the applicable supplemental indentures under which such senior notes were issued. See Note 4 in Item 8, Financial Statements and Supplementary Data for further information. |
2 | Non-cancelable operating lease obligations are presented net of future receipts on contractual sublease arrangements. See Note 3 in Item 8, Financial Statements and Supplementary Data for further information. |
3 | We have structured certain acquisitions with additional contingent purchase price obligations based on factors including future performance of the acquired entity. See Note 6 and Note 16 in Item 8, Financial Statements and Supplementary Data for further information. |
4 | The amounts presented are estimates due to inherent uncertainty of tax settlements, including the ability to offset liabilities with tax loss carryforwards. |
Four Quarters Ended | Four Quarters Ended | |||||
Financial Covenants 1 | December 31, 2019 | EBITDA Reconciliation 1 | December 31, 2019 | |||
Leverage ratio (not greater than) | 3.75x | Operating income | 1,086.0 | |||
Actual leverage ratio | 2.28x | Add: | ||||
Depreciation and amortization | 369.8 | |||||
EBITDA | $ | 1,455.8 |
1 | The leverage ratio is defined as debt as of the last day of such fiscal quarter to EBITDA (as defined in the Credit Agreement) for the four quarters then ended. Pursuant to the July 2018 Amendment No. 1 to the Credit Agreement, the maximum leverage ratio decreased from 4.00x to 3.75x on the last day of the fourth full fiscal quarter ending after the Acxiom closing date on October 1, 2018. |
Moody’s Investors Service | S&P Global Ratings | Fitch Ratings | |||
Short-term rating | P-2 | A-2 | F2 | ||
Long-term rating | Baa2 | BBB | BBB+ | ||
Outlook | Stable | Negative | Stable |
2019 Impairment Test | 2018 Impairment Test | |||||||||||||
Reporting Unit | Goodwill | Fair value exceeds carrying value by: | Reporting Unit | Goodwill | Fair value exceeds carrying value by: | |||||||||
A | $ | 533.5 | > 20% | A | $ | 462.1 | > 40% | |||||||
B | $ | 209.1 | > 30% | B | $ | 638.5 | > 280% | |||||||
C | $ | 182.1 | > 25% | C | $ | 182.1 | > 20% | |||||||
D | $ | 668.5 | > 45% | |||||||||||
E | $ | 1,216.8 | > 205% |
• | Total (Expense) and Other Income, Provision for Income Taxes, Equity in Net Income (Income) of Unconsolidated Affiliates and Net Income Attributable to Noncontrolling Interests. We exclude these items (i) because these items are not directly attributable to the performance of our business operations and, accordingly, their exclusion assists management and investors in making period-to-period comparisons of operating performance and (ii) to assist management and investors in making comparisons to companies with different capital structures. Investors should note that these items will recur in future periods. |
• | Amortization of Acquired Intangibles. Amortization of acquired intangibles is a non-cash expense relating to intangible assets arising from acquisitions that are expensed on a straight-line basis over the estimated useful life of the related assets. We exclude amortization of acquired intangibles because we believe that (i) the amount of such expenses in any specific period may not directly correlate to the underlying performance of our business operations and (ii) such expenses can vary significantly between periods as a result of new acquisitions and full amortization of previously acquired intangible assets. Accordingly, we believe that this exclusion assists management and investors in making period-to-period comparisons of operating performance. Investors should note that the use of acquired intangible assets contributed to revenue in the periods presented and will contribute to future revenue generation and should also note that such expense may recur in future periods. |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Net Revenue | $ | 8,625.1 | $ | 8,031.6 | $ | 7,473.5 | |||||
EBITA Reconciliation: | |||||||||||
Net Income Available to IPG Common Stockholders 1 | $ | 656.0 | $ | 618.9 | $ | 554.4 | |||||
Add Back: | |||||||||||
Provision for Income Taxes | 204.8 | 199.2 | 271.3 | ||||||||
Subtract: | |||||||||||
Total (Expenses) and Other Income | (207.7 | ) | (170.8 | ) | (97.6 | ) | |||||
Equity in Net Income (Loss) of Unconsolidated Affiliates | 0.4 | (1.1 | ) | 0.9 | |||||||
Net Income Attributable to Noncontrolling Interests | (17.9 | ) | (18.8 | ) | (16.0 | ) | |||||
Operating Income 1 | 1,086.0 | 1,008.8 | 938.4 | ||||||||
Add Back: | |||||||||||
Amortization of Acquired Intangibles | 86.0 | 37.6 | 21.1 | ||||||||
EBITA 1 | $ | 1,172.0 | $ | 1,046.4 | $ | 959.5 | |||||
EBITA Margin on Net Revenue 1 | 13.6 | % | 13.0 | % | 12.8 | % |
1 | Calculations include restructuring charges of $33.9 in 2019 and transaction costs of $35.0 related to the Acxiom acquisition in 2018. |
Item 7A. | Quantitative and Qualitative Disclosures About Market Risk |
Increase/(Decrease) in Fair Market Value | |||||||
As of December 31, | 10% Increase in Interest Rates | 10% Decrease in Interest Rates | |||||
2019 | $ | (61.3 | ) | $ | 65.2 | ||
2018 | (91.3 | ) | 82.5 |
Item 8. | Financial Statements and Supplementary Data |
Page | |
2. Revenue | |
3. Leases | |
6. Acquisitions | |
9. Income Taxes | |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
REVENUE: | |||||||||||
Net revenue | $ | $ | $ | ||||||||
Billable expenses | |||||||||||
Total revenue | |||||||||||
OPERATING EXPENSES: | |||||||||||
Salaries and related expenses | |||||||||||
Office and other direct expenses | |||||||||||
Billable expenses | |||||||||||
Cost of services | |||||||||||
Selling, general and administrative expenses | |||||||||||
Depreciation and amortization | |||||||||||
Restructuring charges | ( | ) | |||||||||
Total operating expenses | |||||||||||
OPERATING INCOME | |||||||||||
EXPENSES AND OTHER INCOME: | |||||||||||
Interest expense | ( | ) | ( | ) | ( | ) | |||||
Interest income | |||||||||||
Other expense, net | ( | ) | ( | ) | ( | ) | |||||
Total (expenses) and other income | ( | ) | ( | ) | ( | ) | |||||
Income before income taxes | |||||||||||
Provision for income taxes | |||||||||||
Income of consolidated companies | |||||||||||
Equity in net income (loss) of unconsolidated affiliates | ( | ) | |||||||||
NET INCOME | |||||||||||
Net income attributable to noncontrolling interests | ( | ) | ( | ) | ( | ) | |||||
NET INCOME AVAILABLE TO IPG COMMON STOCKHOLDERS | $ | $ | $ | ||||||||
Earnings per share available to IPG common stockholders: | |||||||||||
Basic | $ | $ | $ | ||||||||
Diluted | $ | $ | $ | ||||||||
Weighted-average number of common shares outstanding: | |||||||||||
Basic | |||||||||||
Diluted |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
NET INCOME | $ | $ | $ | ||||||||
OTHER COMPREHENSIVE INCOME (LOSS) | |||||||||||
Foreign currency translation: | |||||||||||
Foreign currency translation adjustments | ( | ) | |||||||||
Reclassification adjustments recognized in net income | |||||||||||
( | ) | ||||||||||
Available-for-sale securities: | |||||||||||
Changes in fair value of available-for-sale securities | |||||||||||
Recognition of previously unrealized gains in net income | ( | ) | |||||||||
Income tax effect | |||||||||||
( | ) | ||||||||||
Derivative instruments: | |||||||||||
Recognition of previously unrealized losses in net income | |||||||||||
Income tax effect | ( | ) | ( | ) | ( | ) | |||||
Defined benefit pension and other postretirement plans: | |||||||||||
Net actuarial (losses) gains for the period | ( | ) | ( | ) | |||||||
Amortization of unrecognized losses, transition obligation and prior service cost included in net income | |||||||||||
Less: settlement and curtailment (gains) losses included in net income | ( | ) | |||||||||
Other | ( | ) | ( | ) | |||||||
Income tax effect | ( | ) | ( | ) | |||||||
( | ) | ||||||||||
Other comprehensive income (loss), net of tax | ( | ) | |||||||||
TOTAL COMPREHENSIVE INCOME | |||||||||||
Less: comprehensive income attributable to noncontrolling interests | |||||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO IPG | $ | $ | $ |
December 31, 2019 | December 31, 2018 | ||||||
ASSETS: | |||||||
Cash and cash equivalents | $ | $ | |||||
Accounts receivable, net of allowance of $40.2 and $42.5, respectively | |||||||
Accounts receivable, billable to clients | |||||||
Assets held for sale | |||||||
Other current assets | |||||||
Total current assets | |||||||
Property and equipment, net of accumulated depreciation and amortization of $1,116.4 and $1,034.9, respectively | |||||||
Deferred income taxes | |||||||
Goodwill | |||||||
Other intangible assets | |||||||
Operating lease right-of-use assets | |||||||
Other non-current assets | |||||||
TOTAL ASSETS | $ | $ | |||||
LIABILITIES: | |||||||
Accounts payable | $ | $ | |||||
Accrued liabilities | |||||||
Contract liabilities | |||||||
Short-term borrowings | |||||||
Current portion of long-term debt | |||||||
Current portion of operating leases | |||||||
Liabilities held for sale | |||||||
Total current liabilities | |||||||
Long-term debt | |||||||
Non-current operating leases | |||||||
Deferred compensation | |||||||
Other non-current liabilities | |||||||
TOTAL LIABILITIES | |||||||
Redeemable noncontrolling interests (see Note 6) | |||||||
STOCKHOLDERS’ EQUITY: | |||||||
Common stock, $0.10 par value, shares authorized: 800.0 shares issued: 2019 – 387.0; 2018 – 383.6 shares outstanding: 2019 – 387.0; 2018 – 383.6 | |||||||
Additional paid-in capital | |||||||
Retained earnings | |||||||
Accumulated other comprehensive loss, net of tax | ( | ) | ( | ) | |||
Total IPG stockholders’ equity | |||||||
Noncontrolling interests | |||||||
TOTAL STOCKHOLDERS’ EQUITY | |||||||
TOTAL LIABILITIES AND EQUITY | $ | $ |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||
Net income | $ | $ | $ | ||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Depreciation and amortization of fixed assets and intangible assets | |||||||||||
Provision for uncollectible receivables | |||||||||||
Amortization of restricted stock and other non-cash compensation | |||||||||||
Net amortization of bond discounts and deferred financing costs | |||||||||||
Deferred income tax provision (benefit) | ( | ) | |||||||||
Net losses on sales of businesses | |||||||||||
Other | |||||||||||
Changes in assets and liabilities, net of acquisitions and divestitures, providing (using) cash: | |||||||||||
Accounts receivable | ( | ) | ( | ) | |||||||
Accounts receivable, billable to clients | ( | ) | ( | ) | ( | ) | |||||
Other current assets | ( | ) | ( | ) | |||||||
Accounts payable | |||||||||||
Accrued liabilities | ( | ) | ( | ) | |||||||
Contract liabilities | ( | ) | |||||||||
Changes in operating lease right-of-use assets and lease liabilities | |||||||||||
Other non-current assets and liabilities | ( | ) | ( | ) | |||||||
Net cash provided by operating activities | |||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||
Capital expenditures | ( | ) | ( | ) | ( | ) | |||||
Acquisitions, net of cash acquired | ( | ) | ( | ) | ( | ) | |||||
Other investing activities | ( | ) | ( | ) | |||||||
Net cash used in investing activities | ( | ) | ( | ) | ( | ) | |||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||
Exercise of stock options | |||||||||||
Proceeds from long-term debt | |||||||||||
Repurchases of common stock | ( | ) | ( | ) | |||||||
Repayment of long-term debt | ( | ) | ( | ) | ( | ) | |||||
Common stock dividends | ( | ) | ( | ) | ( | ) | |||||
Tax payments for employee shares withheld | ( | ) | ( | ) | ( | ) | |||||
Distributions to noncontrolling interests | ( | ) | ( | ) | ( | ) | |||||
Net (decrease) increase in short-term borrowings | ( | ) | ( | ) | |||||||
Acquisition-related payments | ( | ) | ( | ) | ( | ) | |||||
Other financing activities | ( | ) | ( | ) | ( | ) | |||||
Net cash (used in) provided by financing activities | ( | ) | ( | ) | |||||||
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash | ( | ) | ( | ) | |||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | ( | ) | ( | ) | |||||||
Cash, cash equivalents and restricted cash at beginning of period | |||||||||||
Cash, cash equivalents and restricted cash at end of period | $ | $ | $ |
Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss, Net of Tax | Treasury Stock | Total IPG Stockholders’ Equity | Noncontrolling Interests | Total Stockholders’ Equity | |||||||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||||||||
Balance at December 31, 2016 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||
Net income | ||||||||||||||||||||||||||||||||||
Other comprehensive income | ||||||||||||||||||||||||||||||||||
Reclassifications related to redeemable noncontrolling interests | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
Noncontrolling interest transactions | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
Change in redemption value of redeemable noncontrolling interests | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||
Repurchases of common stock | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||
Retirement of treasury stock | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||
Common stock dividends ($0.72 per share) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||
Stock-based compensation | ||||||||||||||||||||||||||||||||||
Exercise of stock options | ||||||||||||||||||||||||||||||||||
Shares withheld for taxes | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||
Other | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||
Balance at December 31, 2017 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||
Net income | ||||||||||||||||||||||||||||||||||
Other comprehensive loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Reclassifications related to redeemable noncontrolling interests | ||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
Change in redemption value of redeemable noncontrolling interests | ||||||||||||||||||||||||||||||||||
Repurchases of common stock | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||
Retirement of treasury stock | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||
Common stock dividends ($0.84 per share) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||
Stock-based compensation | ||||||||||||||||||||||||||||||||||
Exercise of stock options | ||||||||||||||||||||||||||||||||||
Shares withheld for taxes | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||
Other | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
Balance at December 31, 2018 | $ | $ | $ | $ | ( | ) | $ | $ | $ | $ |
Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss, Net of Tax | Total IPG Stockholders’ Equity | Noncontrolling Interests | Total Stockholders’ Equity | ||||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||||
Balance at December 31, 2018 | $ | $ | $ | $ | ( | ) | $ | $ | $ | |||||||||||||||||||||
Cumulative effect of accounting change | ||||||||||||||||||||||||||||||
Net income | ||||||||||||||||||||||||||||||
Other comprehensive income | ( | ) | ||||||||||||||||||||||||||||
Reclassifications related to redeemable noncontrolling interests | ||||||||||||||||||||||||||||||
Distributions to noncontrolling interests | ( | ) | ( | ) | ||||||||||||||||||||||||||
Change in redemption value of redeemable noncontrolling interests | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||
Common stock dividends ($0.94 per share) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||
Stock-based compensation | ||||||||||||||||||||||||||||||
Exercise of stock options | ||||||||||||||||||||||||||||||
Shares withheld for taxes | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||
Other | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||
Balance at December 31, 2019 | $ | $ | $ | $ | ( | ) | $ | $ | $ |
Years ended December 31, | |||||||||||
Total revenue: | 2019 | 2018 | 2017 | ||||||||
United States | $ | $ | $ | ||||||||
International: | |||||||||||
United Kingdom | |||||||||||
Continental Europe | |||||||||||
Asia Pacific | |||||||||||
Latin America | |||||||||||
Other | |||||||||||
Total International | |||||||||||
Total Consolidated | $ | $ | $ |
Years ended December 31, | |||||||||||
Net revenue: | 2019 | 2018 | 2017 | ||||||||
United States | $ | $ | $ | ||||||||
International: | |||||||||||
United Kingdom | |||||||||||
Continental Europe | |||||||||||
Asia Pacific | |||||||||||
Latin America | |||||||||||
Other | |||||||||||
Total International | |||||||||||
Total Consolidated | $ | $ | $ |
IAN | Years ended December 31, | ||||||||||
Total revenue: | 2019 | 2018 | 2017 | ||||||||
United States | $ | $ | $ | ||||||||
International | |||||||||||
Total IAN | $ | $ | $ | ||||||||
Net revenue: | |||||||||||
United States | $ | $ | $ | ||||||||
International | |||||||||||
Total IAN | $ | $ | $ |
CMG | Years ended December 31, | ||||||||||
Total revenue: | 2019 | 2018 | 2017 | ||||||||
United States | $ | $ | $ | ||||||||
International | |||||||||||
Total CMG | $ | $ | $ | ||||||||
Net revenue: | |||||||||||
United States | $ | $ | $ | ||||||||
International | |||||||||||
Total CMG | $ | $ | $ |
December 31, 2019 | December 31, 2018 | ||||||
Accounts receivable, net of allowance of $40.2 and $42.5, respectively | $ | $ | |||||
Accounts receivable, billable to clients | |||||||
Contract assets | |||||||
Contract liabilities (deferred revenue) |
Twelve months ended December 31, 2019 | ||||
Operating lease cost | $ | |||
Short-term lease cost | ||||
Sublease income | ( | ) | ||
Total lease cost | $ | |||
Twelve months ended December 31, 2019 | ||||
Cash paid for amounts included in the measurement of lease liabilities | $ | |||
Right-of-use assets obtained in exchange for lease liabilities | $ | |||
As of December 31, 2019 | ||||
Weighted-average remaining lease term | ||||
Weighted-average discount rate | % |
Period | Net Rent | ||
2020 | $ | ||
2021 | |||
2022 | |||
2023 | |||
2024 | |||
Thereafter | |||
Total future lease payments | |||
Less: imputed interest | |||
Present value of future lease payments | |||
Less: current portion of operating leases | |||
Non-current operating leases | $ |
Period | Rent Obligations | Sublease Rental Income | Net Rent | ||||||||
2019 | $ | $ | ( | ) | $ | ||||||
2020 | ( | ) | |||||||||
2021 | ( | ) | |||||||||
2022 | ( | ) | |||||||||
2023 | ( | ) | |||||||||
Thereafter | ( | ) | |||||||||
Total future lease payments | $ | $ | ( | ) | $ |
Effective Interest Rate | December 31, | |||||||||||||||||
2019 | 2018 | |||||||||||||||||
Book Value | Fair Value 1 | Book Value | Fair Value 1 | |||||||||||||||
3.50% Senior Notes due 2020 (less unamortized discount and issuance costs of $0.4 and $1.1, respectively) | % | $ | $ | $ | $ | |||||||||||||
3.75% Senior Notes due 2021 (less unamortized discount and issuance costs of $0.2 and $1.9, respectively) | % | |||||||||||||||||
4.00% Senior Notes due 2022 (less unamortized discount and issuance costs of $0.7 and $0.6, respectively) | % | |||||||||||||||||
3.75% Senior Notes due 2023 (less unamortized discount and issuance costs of $0.5 and $1.3, respectively) | % | |||||||||||||||||
4.20% Senior Notes due 2024 (less unamortized discount and issuance costs of $0.4 and $1.8, respectively) | % | |||||||||||||||||
4.65% Senior Notes due 2028 (less unamortized discount and issuance costs of $1.5 and $3.9, respectively) | % | |||||||||||||||||
5.40% Senior Notes due 2048 (less unamortized discount and issuance costs of $2.7 and $5.4, respectively) | % | |||||||||||||||||
Term Loan due 2021 - LIBOR plus 1.25% | ||||||||||||||||||
Other notes payable and capitalized leases | ||||||||||||||||||
Total long-term debt | ||||||||||||||||||
Less: current portion | ||||||||||||||||||
Long-term debt, excluding current portion | $ | $ |
1 | See Note 13 for information on the fair value measurement of our long-term debt. |
2020 | $ | ||
2021 | |||
2022 | |||
2023 | |||
2024 | |||
Thereafter | |||
Total long-term debt | $ |
Financial Covenants 1 | ||
Leverage ratio (not greater than): 1 |
1 | The leverage ratio is defined as debt as of the last day of such fiscal quarter to EBITDA, as defined in the Credit Agreement, for the four quarters then ended. Pursuant to July 2018 Amendment No. 1 to the Credit Agreement, the maximum leverage ratio decreased from 4.00x to 3.75x on the last day of the fourth full fiscal quarter ending after the Acxiom closing date on October 1, 2018. |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Net income available to IPG common stockholders | $ | $ | $ | ||||||||
Weighted-average number of common shares outstanding - basic | |||||||||||
Dilutive effect of stock options and restricted shares | |||||||||||
Weighted-average number of common shares outstanding - diluted | |||||||||||
Earnings per share available to IPG common stockholders: | |||||||||||
Basic | $ | $ | $ | ||||||||
Diluted | $ | $ | $ |
October 1, 2018 | |||
Cash and cash equivalents | $ | ||
Accounts receivable | |||
Accounts receivable, billable to clients | |||
Other current assets | |||
Property and equipment, net | |||
Deferred income taxes | ( | ) | |
Goodwill | |||
Intangible assets, net | |||
Other non-current assets | |||
Accounts payable | ( | ) | |
Accrued liabilities | ( | ) | |
Contract liabilities | ( | ) | |
Other non-current liabilities | ( | ) | |
Net assets acquired | $ |
Fair Value | Weighted Average Amortization Period (Years) | ||||
Customer lists | $ | ||||
Know-how and technology | |||||
Trade names | 15.0 to indefinite | ||||
Total intangible assets | $ |
(Unaudited) | |||||||
December 31, | |||||||
2018 | 2017 | ||||||
Pro forma revenues | $ | $ | |||||
Pro forma net income |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Cost of investment: current-year acquisitions 1 | $ | $ | $ | ||||||||
Cost of investment: prior-year acquisitions | |||||||||||
Less: net cash acquired | ( | ) | ( | ) | |||||||
Total cost of investment | |||||||||||
Operating payments 2 | |||||||||||
Total cash paid for acquisitions 3 | $ | $ | $ |
1 | The cost of investment: current-year acquisitions line significantly increased in the year ended December 31, 2018, primarily as a result of payments related to the acquisition of Acxiom. |
2 | Represents cash payments for amounts that have been recognized in operating expenses since the date of acquisition either relating to adjustments to estimates in excess of the initial value of contingent payments recorded or were contingent upon the future employment of the former owners of the acquired companies. Amounts are reflected in the operating section of the Consolidated Statements of Cash Flows. |
3 | Of the total cash paid for acquisitions, $ |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Balance at beginning of period | $ | $ | $ | ||||||||
Change in related noncontrolling interests balance | ( | ) | ( | ) | ( | ) | |||||
Changes in redemption value of redeemable noncontrolling interests: | |||||||||||
Additions | |||||||||||
Redemptions and other | ( | ) | ( | ) | ( | ) | |||||
Redemption value adjustments | ( | ) | |||||||||
Balance at end of period | $ | $ | $ |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Balance at beginning of period | $ | $ | $ | ||||||||
Charges to costs and expenses | |||||||||||
Adjustments: | |||||||||||
Acquisitions/(dispositions) | ( | ) | ( | ) | |||||||
Uncollectible accounts written off | ( | ) | ( | ) | ( | ) | |||||
Foreign currency translation adjustments | ( | ) | ( | ) | |||||||
Balance at end of period | $ | $ | $ |
December 31, | ||||||||
2019 | 2018 | |||||||
Furniture and equipment | $ | $ | ||||||
Leasehold improvements | ||||||||
Internal-use computer software | ||||||||
Land and buildings | ||||||||
Gross property and equipment | ||||||||
Less: accumulated depreciation and amortization | ( | ) | ( | ) | ||||
Total property and equipment, net | $ | $ |
December 31, | |||||||
2019 | 2018 | ||||||
Salaries, benefits and related expenses | $ | $ | |||||
Acquisition obligations | |||||||
Office and related expenses | |||||||
Interest | |||||||
Restructuring charges | |||||||
Other | |||||||
Total accrued liabilities | $ | $ |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Net losses on sales of businesses | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||
Other | ( | ) | ( | ) | |||||||
Total other expense, net | $ | ( | ) | $ | ( | ) | $ | ( | ) |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Cash paid for interest | $ | $ | $ | ||||||||
Cash paid for income taxes, net of refunds 1 |
1 | Refunds of $ |
IAN 1 | CMG | Total 2 | ||||||||||
Balance as of December 31, 2017 | $ | $ | $ | |||||||||
Acquisitions | ||||||||||||
Foreign currency and other | ( | ) | ( | ) | ( | ) | ||||||
Balance as of December 31, 2018 | $ | $ | $ | |||||||||
Acquisitions | ||||||||||||
Foreign currency and other | ||||||||||||
Balance as of December 31, 2019 | $ | $ | $ |
1 | During 2018, the increase in goodwill is primarily due to the acquisition of Acxiom. See Note 6 for further information on the Acxiom acquisition. |
2 | For all periods presented, no goodwill impairment charge has been recorded. |
December 31, | ||||||||||||||||||||||||
2019 | 2018 | |||||||||||||||||||||||
Gross Amount | Accumulated Amortization | Net Amount | Gross Amount | Accumulated Amortization | Net Amount | |||||||||||||||||||
Customer lists | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ||||||||||||||
Know-how and technology | ( | ) | ( | ) | ||||||||||||||||||||
Trade names | ( | ) | ( | ) | ||||||||||||||||||||
Other | ( | ) | ( | ) | ||||||||||||||||||||
Total | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ |
2020 | 2021 | 2022 | 2023 | 2024 | ||||||||||||||||
Estimated amortization expense | $ | $ | $ | $ | $ |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Domestic | $ | $ | $ | ||||||||
Foreign | |||||||||||
Total | $ | $ | $ |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
U.S. federal income taxes (including foreign withholding taxes): | |||||||||||
Current | $ | $ | $ | ||||||||
Deferred | ( | ) | |||||||||
State and local income taxes: | |||||||||||
Current | |||||||||||
Deferred | |||||||||||
Foreign income taxes: | |||||||||||
Current | |||||||||||
Deferred | ( | ) | ( | ) | |||||||
Total | $ | $ | $ |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
U.S. federal statutory income tax rate | % | % | % | ||||||||
Income tax provision at U.S. federal statutory rate | $ | $ | $ | ||||||||
State and local income taxes, net of U.S. federal income tax benefit | |||||||||||
Impact of foreign operations, including withholding taxes | ( | ) | |||||||||
U.S. tax incentives | ( | ) | ( | ) | ( | ) | |||||
Change in net valuation allowance 1 | ( | ) | ( | ) | |||||||
Divestitures | |||||||||||
U.S. federal tax credits | ( | ) | ( | ) | |||||||
Stock compensation | ( | ) | ( | ) | ( | ) | |||||
Increase in unrecognized tax benefits | |||||||||||
Net impact of the Tax Act | ( | ) | |||||||||
Other | ( | ) | |||||||||
Provision for income taxes | $ | $ | $ | ||||||||
Effective income tax rate on operations | % | % | % |
1 | Reflects changes in valuation allowances that impacted the effective income tax rate for each year presented. |
December 31, | |||||||
2019 | 2018 | ||||||
Postretirement/post-employment benefits | $ | $ | |||||
Deferred compensation | |||||||
Pension costs | |||||||
Basis differences in fixed assets | ( | ) | ( | ) | |||
Rent | |||||||
Interest | |||||||
Accruals and reserves | |||||||
Allowance for doubtful accounts | |||||||
Basis differences in intangible assets | ( | ) | ( | ) | |||
Investments in equity securities | |||||||
Operating lease right-of-use assets | ( | ) | |||||
Operating lease liabilities | |||||||
Tax loss/tax credit carry forwards | |||||||
Prepaid expenses | ( | ) | ( | ) | |||
Deferred revenue | ( | ) | ( | ) | |||
Unremitted foreign earnings | ( | ) | ( | ) | |||
Other | |||||||
Total deferred tax assets, net | |||||||
Valuation allowance | ( | ) | ( | ) | |||
Net deferred tax (liabilities) assets | $ | ( | ) | $ |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Balance at beginning of period | $ | $ | $ | ||||||||
Reversed to costs and expenses | ( | ) | ( | ) | ( | ) | |||||
(Reversed) charged to gross tax assets and other accounts 1 | ( | ) | ( | ) | |||||||
Foreign currency translation | ( | ) | ( | ) | |||||||
Balance at end of period | $ | $ | $ |
1 | Primarily represents changes to the valuation allowance related to the change of a corresponding deferred tax asset. |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Balance at beginning of period | $ | $ | $ | ||||||||
Increases as a result of tax positions taken during a prior year | |||||||||||
Decreases as a result of tax positions taken during a prior year | ( | ) | ( | ) | ( | ) | |||||
Settlements with taxing authorities | ( | ) | ( | ) | ( | ) | |||||
Lapse of statutes of limitation | ( | ) | ( | ) | ( | ) | |||||
Increases as a result of tax positions taken during the current year | |||||||||||
Balance at end of period | $ | $ | $ |
Foreign Currency Translation Adjustments | Derivative Instruments | Defined Benefit Pension and Other Postretirement Plans | Total | ||||||||||||
Balance as of December 31, 2017 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
Other comprehensive (loss) income before reclassifications | ( | ) | ( | ) | |||||||||||
Amount reclassified from accumulated other comprehensive loss, net of tax | |||||||||||||||
Balance as of December 31, 2018 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
Other comprehensive income (loss) before reclassifications | ( | ) | ( | ) | |||||||||||
Amount reclassified from accumulated other comprehensive loss, net of tax | |||||||||||||||
Balance as of December 31, 2019 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) |
Years ended December 31, | Affected Line Item in the Consolidated Statements of Operations | |||||||||||||
2019 | 2018 | 2017 | ||||||||||||
Foreign currency translation adjustments 1 | $ | $ | $ | Other expense, net | ||||||||||
Gains on available-for-sale securities | ( | ) | Other expense, net | |||||||||||
Losses on derivative instruments | Interest expense | |||||||||||||
Amortization of defined benefit pension and postretirement plans items | Other expense, net | |||||||||||||
Tax effect | ( | ) | ( | ) | ( | ) | Provision for income taxes | |||||||
Total amount reclassified from accumulated other comprehensive loss, net of tax | $ | $ | $ |
1 | These foreign currency translation adjustments are primarily a result of the sales of businesses. |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Severance and termination costs | $ | $ | $ | ||||||||
Lease restructuring costs | ( | ) | |||||||||
Total restructuring charges | $ | $ | $ | ( | ) |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Stock-settled awards | $ | $ | $ | ||||||||
Cash-settled awards | |||||||||||
Performance-based awards | |||||||||||
Employee stock purchase plan | |||||||||||
Other 1 | |||||||||||
Stock-based compensation expense | $ | $ | $ | ||||||||
Tax benefit | $ | $ | $ |
1 | Represents charges recorded for severance expense related to stock-based compensation awards. |
Options | Weighted- Average Exercise Price (per option) | Weighted- Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value | ||||||||||
Stock options outstanding as of January 1, 2019 | $ | ||||||||||||
Exercised | ( | ) | $ | ||||||||||
Stock options outstanding as of December 31, 2019 | $ | $ |
Years ended December 31, | ||||||||||||
2019 | 2018 | 2017 | ||||||||||
Stock-Settled Awards: | ||||||||||||
Awards granted | ||||||||||||
Weighted-average grant-date fair value (per award) | $ | $ | $ | |||||||||
Total fair value of vested awards distributed | $ | $ | $ | |||||||||
Cash-Settled Awards: | ||||||||||||
Awards granted | ||||||||||||
Weighted-average grant-date fair value (per award) | $ | $ | $ | |||||||||
Total fair value of vested awards distributed | $ | $ | $ | |||||||||
Performance-Based Awards: | ||||||||||||
Awards granted | ||||||||||||
Weighted-average grant-date fair value (per award) | $ | $ | $ | |||||||||
Total fair value of vested awards distributed | $ | $ | $ |
Stock-Settled Awards | Cash-Settled Awards | Performance-Based Awards | ||||||||||||||||||||||
Awards | Weighted- Average Grant-Date Fair Value (per award) | Awards | Weighted- Average Grant-Date Fair Value (per award) | Awards | Weighted- Average Grant-Date Fair Value (per award) | |||||||||||||||||||
Non-vested as of January 1, 2019 | $ | $ | $ | |||||||||||||||||||||
Granted | ||||||||||||||||||||||||
Vested | ( | ) | ( | ) | ||||||||||||||||||||
Forfeited | ( | ) | ( | ) | ||||||||||||||||||||
Non-vested as of December 31, 2019 | $ | $ | $ | |||||||||||||||||||||
Total unrecognized compensation expense remaining | $ | $ | $ | |||||||||||||||||||||
Weighted-average years expected to be recognized over |
Level 1 | Unadjusted quoted prices in active markets for identical assets or liabilities. An active market for the asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. | |
Level 2 | Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |
Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. |
December 31, 2019 | Balance Sheet Classification | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Assets | |||||||||||||||||
Cash equivalents | $ | $ | $ | $ | Cash and cash equivalents | ||||||||||||
Liabilities | |||||||||||||||||
Contingent acquisition obligations 1 | $ | $ | $ | $ | Accrued liabilities and Other non-current liabilities | ||||||||||||
December 31, 2018 | Balance Sheet Classification | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Assets | |||||||||||||||||
Cash equivalents | $ | $ | $ | $ | Cash and cash equivalents | ||||||||||||
Liabilities | |||||||||||||||||
Contingent acquisition obligations 1 | $ | $ | $ | $ | Accrued liabilities and Other non-current liabilities |
1 | Contingent acquisition obligations includes deferred acquisition payments and unconditional obligations to purchase additional noncontrolling equity shares of consolidated subsidiaries. Fair value measurement of the obligations is based upon actual and projected operating performance targets as specified in the related agreements. The decrease in this balance of $ |
December 31, 2019 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Total long-term debt | $ | $ | $ | $ |
Domestic Pension Plan | Foreign Pension Plans | Domestic Postretirement Benefit Plan | |||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | 2019 | 2018 | ||||||||||||||||||
Benefit Obligation | |||||||||||||||||||||||
Projected benefit obligation as of January 1 | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Service cost | |||||||||||||||||||||||
Interest cost | |||||||||||||||||||||||
Benefits paid | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||
Plan participant contributions | |||||||||||||||||||||||
Actuarial losses (gains) | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Settlements and curtailments | ( | ) | ( | ) | |||||||||||||||||||
Foreign currency effect | ( | ) | |||||||||||||||||||||
Other | |||||||||||||||||||||||
Projected benefit obligation as of December 31 | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Fair Value of Plan Assets | |||||||||||||||||||||||
Fair value of plan assets as of January 1 | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Actual return on plan assets | ( | ) | ( | ) | |||||||||||||||||||
Employer contributions | |||||||||||||||||||||||
Plan participant contributions | |||||||||||||||||||||||
Benefits paid | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||
Settlements | ( | ) | |||||||||||||||||||||
Foreign currency effect | ( | ) | |||||||||||||||||||||
Other | |||||||||||||||||||||||
Fair value of plan assets as of December 31 | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Funded status of the plans at December 31 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) |
Domestic Pension Plan | Foreign Pension Plans | Domestic Postretirement Benefit Plan | |||||||||||||||||||||
December 31, | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | |||||||||||||||||
Amounts recognized in Consolidated Balance Sheets | |||||||||||||||||||||||
Non-current asset | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Current liability | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||
Non-current liability | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||
Net liability recognized | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||||
Accumulated benefit obligation | $ | $ | $ | $ | |||||||||||||||||||
Amounts recognized in Accumulated Other Comprehensive Loss, net | |||||||||||||||||||||||
Net actuarial loss | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Prior service cost (credit) | ( | ) | ( | ) | |||||||||||||||||||
Total amount recognized | $ | $ | $ | $ | $ | $ |
Domestic Pension Plan | Foreign Pension Plans | ||||||||||||||
December 31, | 2019 | 2018 | 2019 | 2018 | |||||||||||
Pension plans with an accumulated benefit obligation and projected benefit obligation in excess of plan assets | |||||||||||||||
Aggregate projected benefit obligation | $ | $ | $ | $ | |||||||||||
Aggregate accumulated benefit obligation | |||||||||||||||
Aggregate fair value of plan assets |
Domestic Pension Plan | Foreign Pension Plans | Domestic Postretirement Benefit Plan | |||||||||||||||||||||||||||||||||
Years ended December 31, | 2019 | 2018 | 2017 | 2019 | 2018 | 2017 | 2019 | 2018 | 2017 | ||||||||||||||||||||||||||
Service cost | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
Interest cost | |||||||||||||||||||||||||||||||||||
Expected return on plan assets | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||
Settlement and curtailment (gains) losses | ( | ) | |||||||||||||||||||||||||||||||||
Amortization of: | |||||||||||||||||||||||||||||||||||
Prior service cost (credit) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Net actuarial losses | |||||||||||||||||||||||||||||||||||
Net periodic cost | $ | $ | ( | ) | $ | $ | $ | $ | $ | $ | $ |
Domestic Pension Plan | Foreign Pension Plans | Domestic Postretirement Benefit Plan | ||||||||||||||||||||||||
Years ended December 31, | 2019 | 2018 | 2017 | 2019 | 2018 | 2017 | 2019 | 2018 | 2017 | |||||||||||||||||
Net periodic cost | ||||||||||||||||||||||||||
Discount rate | % | % | % | % | % | % | % | % | % | |||||||||||||||||
Rate of compensation increase | N/A | N/A | N/A | % | % | % | N/A | N/A | N/A | |||||||||||||||||
Expected return on plan assets | % | % | % | % | % | % | N/A | N/A | N/A | |||||||||||||||||
Interest crediting rates | % | % | % | % | % | % | N/A | N/A | N/A | |||||||||||||||||
Benefit obligation | ||||||||||||||||||||||||||
Discount rate | % | % | % | % | % | % | % | % | % | |||||||||||||||||
Rate of compensation increase | N/A | N/A | N/A | % | % | % | N/A | N/A | N/A | |||||||||||||||||
Interest crediting rates | % | % | % | % | % | % | N/A | N/A | N/A | |||||||||||||||||
Health care cost trend rate assumed for next year | ||||||||||||||||||||||||||
Initial rate (weighted-average) | % | % | % | |||||||||||||||||||||||
Year ultimate rate is reached | ||||||||||||||||||||||||||
Ultimate rate | % | % | % |
December 31, 2019 | December 31, 2018 | ||||||||||||||||||||||||||||||
Plan assets subject to fair value hierarchy | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||
Registered investment companies | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
Limited partnerships | |||||||||||||||||||||||||||||||
Fixed income securities | |||||||||||||||||||||||||||||||
Insurance contracts | |||||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||||
Total plan assets, subject to leveling | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
Plan assets measured at net asset value | |||||||||||||||||||||||||||||||
Other investments measured at net asset value 1 | |||||||||||||||||||||||||||||||
Total plan assets | $ | $ |
1 | Certain investments that are measured at fair value using the net asset value per share (or its equivalent) as a practical expedient have not been classified in the fair value hierarchy but are included to reconcile to the amounts presented in the fair value of plan assets table above. |
Years ended December 31, | |||||||
Plan assets subject to fair value hierarchy, Level 3 | 2019 | 2018 | |||||
Balance at beginning of period | $ | $ | |||||
Actual return on plan assets | ( | ) | |||||
Balance at end of period | $ | $ |
December 31, | ||||||||
Asset Class | 2020 Target Allocation | 2019 | 2018 | |||||
Alternative investments 1 | % | % | % | |||||
Equity securities | % | % | % | |||||
Fixed income securities | % | % | % | |||||
Liability driven investments 2 | % | % | % | |||||
Real estate | % | % | % | |||||
Other | % | % | % | |||||
Total | % | % | % |
1 | Alternative investments have the flexibility to dynamically invest across a broad range of asset classes including bonds, equity, cash, property and commodities. |
2 | Liability driven investment strategies use government bonds as well as derivative instruments to hedge a portion of the impact of interest rates and inflation movements on the long-term liabilities. |
Years | Domestic Pension Plan | Foreign Pension Plans | Domestic Postretirement Benefit Plan | ||||||||
2020 | $ | $ | $ | ||||||||
2021 | |||||||||||
2022 | |||||||||||
2023 | |||||||||||
2024 | |||||||||||
2025 - 2029 |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Total Revenue: | |||||||||||
IAN | $ | $ | $ | ||||||||
CMG | |||||||||||
Total | $ | $ | $ | ||||||||
Net revenue: | |||||||||||
IAN | $ | $ | $ | ||||||||
CMG | |||||||||||
Total | $ | $ | $ | ||||||||
Segment EBITA: | |||||||||||
IAN | $ | $ | $ | ||||||||
CMG | |||||||||||
Corporate and other | ( | ) | ( | ) | ( | ) | |||||
Total | $ | $ | $ | ||||||||
Amortization of acquired intangibles: | |||||||||||
IAN | $ | $ | $ | ||||||||
CMG | |||||||||||
Corporate and other | |||||||||||
Total | $ | $ | $ | ||||||||
Depreciation and amortization 1: | |||||||||||
IAN | $ | $ | $ | ||||||||
CMG | |||||||||||
Corporate and other | |||||||||||
Total | $ | $ | $ | ||||||||
Capital expenditures: | |||||||||||
IAN | $ | $ | $ | ||||||||
CMG | |||||||||||
Corporate and other | |||||||||||
Total | $ | $ | $ |
December 31, | |||||||
2019 | 2018 | ||||||
Total assets: | |||||||
IAN | $ | $ | |||||
CMG | |||||||
Corporate and other | |||||||
Total | $ | $ |
Years ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
IAN EBITA | $ | $ | $ | ||||||||
CMG EBITA | |||||||||||
Corporate and other EBITA | ( | ) | ( | ) | ( | ) | |||||
Less: consolidated amortization of acquired intangibles | |||||||||||
Operating income | |||||||||||
Total (expenses) and other income | ( | ) | ( | ) | ( | ) | |||||
Income before income taxes | $ | $ | $ |
Long-Lived Assets | ||||||||
December 31, | ||||||||
2019 | 2018 | |||||||
Domestic | $ | $ | ||||||
International: | ||||||||
United Kingdom | ||||||||
Continental Europe | ||||||||
Asia Pacific | ||||||||
Latin America | ||||||||
Other | ||||||||
Total International | ||||||||
Total Consolidated | $ | $ |
2020 | 2021 | 2022 | 2023 | 2024 | Thereafter | Total | ||||||||||||||||||||||
Deferred acquisition payments | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Redeemable noncontrolling interests and call options with affiliates 1 | ||||||||||||||||||||||||||||
Total contingent acquisition payments | $ | $ | $ | $ | $ | $ | $ |
1 | We have entered into certain acquisitions that contain both redeemable noncontrolling interests and call options with similar terms and conditions. The estimated amounts listed would be paid in the event of exercise at the earliest exercise date. We have certain redeemable noncontrolling interests that are |
Three Months Ended March 31, | Three Months Ended June 30, | Three Months Ended September 30, | Three Months Ended December 31, | ||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||||
Net revenue | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
Billable expenses | |||||||||||||||||||||||||||||||
Total Revenue | |||||||||||||||||||||||||||||||
Operating Expenses: | |||||||||||||||||||||||||||||||
Salaries and related expenses | |||||||||||||||||||||||||||||||
Office and other direct expenses | |||||||||||||||||||||||||||||||
Billable expenses | |||||||||||||||||||||||||||||||
Cost of services | |||||||||||||||||||||||||||||||
Selling, general and administrative expenses 1 | |||||||||||||||||||||||||||||||
Depreciation and amortization | |||||||||||||||||||||||||||||||
Restructuring Charges 2 | |||||||||||||||||||||||||||||||
Total operating expenses | |||||||||||||||||||||||||||||||
Operating income | |||||||||||||||||||||||||||||||
Other (expense) income, net 3 | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||
Total (expenses) and other income | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||
Provision for income taxes 4 | |||||||||||||||||||||||||||||||
Net (loss) income | ( | ) | ( | ) | |||||||||||||||||||||||||||
Net (loss) income available to IPG common stockholders | $ | ( | ) | $ | ( | ) | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
(Loss) earnings per share available to IPG common stockholders: | |||||||||||||||||||||||||||||||
Basic | $ | ( | ) | $ | ( | ) | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
Diluted | $ | ( | ) | $ | ( | ) | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
Dividends declared per common share | $ | $ | $ | $ | $ | $ | $ | $ |
1 | The three months ended June 30, September 30 and December 31, 2018 included transaction costs of $ |
2 | The three months ended March 31, 2019 and June 30, 2019 included restructuring charges of $ |
3 | The three months ended March 31, June 30, September 30 and December 31, 2019 included pre-tax net losses of $ |
4 |
Item 9. | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
Item 9A. | Controls and Procedures |
Item 9B. | Other Information |
Item 10. | Directors, Executive Officers and Corporate Governance |
Item 11. | Executive Compensation |
Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
Plan Category | Number of Shares of Common Stock to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a) 1, 2, 3, 4 | Weighted-Average Exercise Price of Outstanding Stock Options (b) | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) (c) 5 | ||||||
Equity Compensation Plans Approved by Security Holders | 11,542,945 | $ | 12.26 | 36,045,173 |
1 | Included a total of 1,186,217 outstanding stock options granted under the 2009 Performance Incentive Plan (the “2009 Plan"). These options are the only instruments taken into account in computing the weighted-average exercise price in column (b) of this table. |
2 | Included a total of 5,553,098 shares of Common Stock representing the target number of shares issuable under the 2014 Performance Incentive Plan (the “2014 Plan”) following the completion of the 2017-2019 performance period, the 2018-2020 performance period, and the 2019-2021 performance period, respectively. |
3 | Included a total of 4,717,130 shares of Common Stock issuable pursuant to restricted share unit awards granted under the 2014 Plan, which are settled in shares of Common Stock. |
4 | Included a total of 86,500 shares of Common Stock issuable pursuant to restricted share units awards granted under the 2009 Non-Management Directors’ Stock Incentive Plan, which are settled in shares of Common Stock. |
5 | Included (i) 27,153,156 shares of Common Stock available for issuance under the shares of Common Stock available for issuance under the 2019 Performance Incentive Plan and (ii) 8,892,017 shares of Common Stock available for issuance under the Employee Stock Purchase Plan (2016). |
Item 13. | Certain Relationships and Related Transactions, and Director Independence |
Item 14. | Principal Accountant Fees and Services |
Item 15. | Exhibits, Financial Statement Schedules |
Item 16. | Form 10-K Summary |
Exhibit No. | Description | |
Membership Interest Purchase Agreement, dated as of July 2, 2018, by and among Acxiom Corporation, the Registrant, LiveRamp, Inc., and Acxiom Holdings, Inc., is incorporated by reference to Exhibit 2.1 of the Registrant’s Current Report on Form 8-K, filed with the SEC on July 6, 2018. | ||
Restated Certificate of Incorporation of the Registrant dated as of October 24, 2013, is incorporated by reference to Exhibit 3(i)(2) to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2013. | ||
Amended and Restated By-Laws of the Registrant dated as of October 26, 2016, is incorporated by reference to Exhibit 3(ii) to the Registrant’s Current Report on Form 8-K filed with the SEC on October 27, 2016. | ||
Senior Debt Indenture dated as of March 2, 2012 (the "2012 Indenture"), between the Registrant and U.S. Bank National Association, as Trustee, is incorporated by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K filed with the SEC on March 2, 2012. | ||
First Supplemental Indenture, dated as of March 2, 2012, to the 2012 Indenture, with respect to the 4.00% Senior Notes due 2022 is incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on March 2, 2012. | ||
Third Supplemental Indenture, dated as of November 8, 2012, to the 2012 Indenture, with respect to the 3.75% Senior Notes due 2023 is incorporated by reference to Exhibit 4.3 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 8, 2012. | ||
Fourth Supplemental Indenture, dated as of April 3, 2014, to the 2012 Indenture, with respect to the 4.20% Senior Notes due 2024 is incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 3, 2014. | ||
Fifth Supplemental Indenture, dated as of September 21, 2018, to the 2012 Indenture, with respect to the 3.500% Senior Notes due 2020 is incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on September 21, 2018. | ||
Sixth Supplemental Indenture, dated as of September 21, 2018, to the 2012 Indenture, with respect to the 3.750% Senior Notes due 2021 is incorporated by reference to Exhibit 4.3 to the Registrant’s Current Report on Form 8-K filed with the SEC on September 21, 2018. | ||
Seventh Supplemental Indenture, dated as of September 21, 2018, to the 2012 Indenture, with respect to the 4.650% Senior Notes due 2028 is incorporated by reference to Exhibit 4.4 to the Registrant’s Current Report on Form 8-K filed with the SEC on September 21, 2018. | ||
Eighth Supplemental Indenture, dated as of September 21, 2018, to the 2012 Indenture, with respect to the 5.400% Senior Notes due 2048 is incorporated by reference to Exhibit 4.5 to the Registrant’s Current Report on Form 8-K filed with the SEC on September 21, 2018. | ||
Description of Registered Securities | ||
Amended and Restated Credit Agreement, dated as of November 1, 2019, among The Interpublic Group of Companies, Inc., the lenders named therein and Citibank, N.A., as administrative agent. is incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 5, 2019. | ||
(i) Michael I. Roth | ||
Employment Agreement, made as of July 13, 2004, by and between the Registrant and Michael I. Roth, is incorporated by reference to Exhibit 10(iii)(A)(9) to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2004.* | ||
Supplemental Employment Agreement, dated as of January 19, 2005, between the Registrant and Michael I. Roth, is incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on January 21, 2005.* | ||
Supplemental Employment Agreement, dated as of February 14, 2005, between the Registrant and Michael I. Roth, is incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on February 17, 2005.* | ||
Exhibit No. | Description | |
Amendment, made as of September 12, 2007, to an Employment Agreement, made as of July 13, 2004, between the Registrant and Michael I. Roth, is incorporated by reference to Exhibit 10(iii)(A)(7) to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2007. * | ||
Amendment, dated May 1, 2008, to an Employment Agreement, made as of July 13, 2004, between the Registrant and Michael I. Roth, is incorporated by reference to Exhibit 10(iii)(A)(1) to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2008.* | ||
The Interpublic Senior Executive Retirement Income Plan Participation Agreement, dated March 31, 2008, between the Registrant and Michael I. Roth, is incorporated by reference to Exhibit 10(iii)(A)(1) to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2008.* | ||
Executive Change of Control Agreement, effective as of May 27, 2010, by and between the Registrant and Michael I. Roth, is incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on May 27, 2010.* | ||
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Michael I. Roth, dated August 29, 2013 is incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed with the SEC on August 30, 2013.* | ||
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Michael I. Roth, dated October 26, 2016 is incorporated by reference to Exhibit 10(iii)(a)(1) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2016.* | ||
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Michael I. Roth, dated July 24, 2019 is incorporated by reference to Exhibit 10(iii)(a)(2) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.* | ||
(ii) Andrew Bonzani | ||
Employment Agreement, effective as of December 22, 2011, by and between the Registrant and Andrew Bonzani, is incorporated by reference to Exhibit(iii)(A)(8) to the Registrant's Annual Report on Form 10-K for the year ended December 31, 2012.* | ||
Executive Change of Control Agreement, effective as of December 22, 2011, by and between the Registrant and Andrew Bonzani, is incorporated by reference to Exhibit(iii)(A)(9) to the Registrant's Annual Report on Form 10-K for the year ended December 31, 2012.* | ||
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Andrew Bonzani, dated August 29, 2013 is incorporated by reference to Exhibit 10.3 to the Registrant's Current Report on Form 8-K filed with the SEC on August 30, 2013.* | ||
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Andrew Bonzani, dated October 26, 2016 is incorporated by reference to Exhibit 10(iii)(a)(3) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2016.* | ||
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Andrew Bonzani, dated July 24, 2019 is incorporated by reference to Exhibit 10(iii)(a)(3) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.* | ||
(iii) Christopher Carroll | ||
Employment Agreement, made as of April 1, 2006, by and between the Registrant and Christopher Carroll, is incorporated by reference to Exhibit 10(iii)(A)(8) to the Registrant's Annual Report on Form 10-K for the year ended December 31, 2011.* | ||
Amendment, dated as of October 29, 2007, to an Employment Agreement, made as of April 1, 2006, between the Registrant and Christopher Carroll, is incorporated by reference to Exhibit 10(iii)(A)(9) to the Registrant's Annual Report on Form 10-K for the year ended December 31, 2011.* | ||
Executive Change of Control Agreement, effective as of May 27, 2010, by and between the Registrant and Christopher Carroll, is incorporated by reference to Exhibit 10(iii)(A)(10) to the Registrant's Annual Report on Form 10-K for the year ended December 31, 2011.* | ||
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Christopher Carroll, dated August 29, 2013 is incorporated by reference to Exhibit 10.4 to the Registrant's Current Report on Form 8-K filed with the SEC on August 30, 2013.* | ||
Exhibit No. | Description | |
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Christopher Carroll, dated October 26, 2016 is incorporated by reference to Exhibit 10(iii)(a)(4) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2016.* | ||
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Christopher Carroll, dated July 24, 2019 is incorporated by reference to Exhibit 10(iii)(a)(4) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.* | ||
(iv) Ellen Johnson | ||
Employment Agreement between the Registrant and Ellen Johnson dated as of April 1, 2004, is incorporated by reference to Exhibit 10(iii)(A)(1) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2019.*. | ||
Supplemental Employment Agreement between the Registrant and Ellen Johnson dated September 22, 2004, is incorporated by reference to Exhibit 10(iii)(A)(2) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2019.*. | ||
Amendment to Employment Agreement between the Registrant and Ellen Johnson dated as of March 4, 2008, is incorporated by reference to Exhibit 10(iii)(A)(3) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2019.*. | ||
Executive Change of Control Agreement between the Registrant and Ellen Johnson dated as of May 27, 2010, is incorporated by reference to Exhibit 10(iii)(A)(4) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2019.*. | ||
Extension of Existing Executive Change of Control Agreement between the Registrant and Ellen Johnson dated August 29, 2013, is incorporated by reference to Exhibit 10(iii)(A)(5) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2019.*. | ||
Extension of Existing Executive Change of Control Agreement between the Registrant and Ellen Johnson dated October 26, 2016, is incorporated by reference to Exhibit 10(iii)(A)(6) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2019.*. | ||
Extension of Existing Executive Change of Control Agreement between the Registrant and Ellen Johnson dated July 24, 2019 is incorporated by reference to Exhibit 10(iii)(a)(6) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.*. | ||
(iv) Philippe Krakowsky | ||
Executive Special Benefits Agreement, dated as of February 1, 2002, and signed as of August 21, 2002, between the Registrant and Philippe Krakowsky, is incorporated by reference to Exhibit 10(iii)(A)(v) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2002.* | ||
Employment Agreement, made as of January 1, 2006 and executed on March 20, 2006, by and between the Registrant and Philippe Krakowsky, is incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed with the SEC on March 24, 2006.* | ||
Amendment, made as of September 12, 2007, to an Employment Agreement, made as of January 1, 2006, between the Registrant and Philippe Krakowsky, is incorporated by reference to Exhibit 10(iii)(A)(13) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.* | ||
Amendment, dated September 12, 2007, to an Executive Special Benefit Agreement, dated February 1, 2002, between the Registrant and Philippe Krakowsky, is incorporated by reference to Exhibit 10(iii)(A)(15) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.* | ||
Amendment, dated May 1, 2008, to an Employment Agreement, made as of January 1, 2006, between the Registrant and Philippe Krakowsky, is incorporated by reference to Exhibit 10(iii)(A)(3) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2008.* | ||
Executive Change of Control Agreement, effective as of May 27, 2010, by and between the Registrant and Philippe Krakowsky, is incorporated by reference to Exhibit 10.3 to the Registrant's Current Report on Form 8-K filed with the SEC on May 27, 2010.* | ||
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Philippe Krakowsky, dated August 29, 2013 is incorporated by reference to Exhibit 10.5 to the Registrant's Current Report on Form 8-K filed with the SEC on August 30, 2013.* | ||
Exhibit No. | Description | |
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Philippe Krakowsky, dated October 26, 2016 is incorporated by reference to Exhibit 10(iii)(a)(5) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2016.* | ||
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Philippe Krakowsky, dated July 24, 2019 is incorporated by reference to Exhibit 10(iii)(a)(5) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.* | ||
(v) Frank Mergenthaler | ||
Employment Agreement, made as of July 13, 2005, between the Registrant and Frank Mergenthaler is incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed with the SEC on July 19, 2005.* | ||
Amendment, made as of September 12, 2007, to an Employment Agreement, made as of July 13, 2005, between the Registrant and Frank Mergenthaler, is incorporated by reference to Exhibit 10(iii)(A)(9) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.* | ||
Amendment, dated May 1, 2008, to an Employment Agreement, made as of July 13, 2005, between the Registrant and Frank Mergenthaler, is incorporated by reference to Exhibit 10(iii)(A)(2) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2008.* | ||
Executive Change of Control Agreement, effective as of May 27, 2010, by and between the Registrant and Frank Mergenthaler, is incorporated by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K filed with the SEC on May 27, 2010.* | ||
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Frank Mergenthaler, dated August 29, 2013 is incorporated by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K filed with the SEC on August 30, 2013.* | ||
Extension of Existing Executive Change of Control Agreement by and between the Registrant and Frank Mergenthaler, dated October 26, 2016 is incorporated by reference to Exhibit 10(iii)(a)(2) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2016.* | ||
Transition Agreement, dated as of June 11, 2019, by and between the Registrant and Frank Mergenthaler, is incorporated by reference to the Registrant’s Current Report on Form 8-K filed with the SEC on June 12, 2019* | ||
Compensation Plans and Arrangements: | ||
The Interpublic 2009 Performance Incentive Plan (the “2009 PIP”) is incorporated by reference to Appendix A to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed with the SEC on June 2, 2009.* | ||
2009 PIP Non-Statutory Stock Option Award Agreement (updated 2010) is incorporated by reference to Exhibit 10(iii)(A)(89) to the Registrant's Annual Report on Form 10-K for the year ended December 31, 2010.* | ||
2009 PIP Non-Statutory Stock Option Award Agreement (updated 2013) is incorporated by reference to Exhibit 10(iii)(A)(68) to the Registrant's Annual Report on Form 10-K for the year ended December 31, 2012.* | ||
The 2009 Non-Management Directors’ Stock Incentive Plan (the “2009 NMD Plan”) is incorporated by reference to Exhibit 10(iii)(A)(9) to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2009.* | ||
Amendment to the 2009 NMD Plan is incorporated by reference to Exhibit 10(iii)(A)(2) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2012.* | ||
2009 NMD Plan Restricted Stock Award Agreement (updated 2013) is incorporated by reference to Exhibit 10(iii)(A)(3) to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2012.* | ||
Supplement to the 2006 PIP and 2009 PIP is incorporated by reference to Exhibit 10(iii)(A)(88) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2009.* | ||
The Interpublic Group 2014 Performance Incentive Plan (the “2014 PIP”) is incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed with the SEC on May 28, 2014.* |
Exhibit No. | Description | |
2014 PIP Restricted Stock Award Agreement is incorporated by reference to Exhibit 10(iii)(A)(60) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2014.* | ||
2014 PIP Restricted Stock Unit Award Agreement (updated 2018), is incorporated by reference to Exhibit 10(iii)(A)(46) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2017.* | ||
2014 PIP Restricted Stock Unit Award Agreement (updated 2019) is incorporated by reference to Exhibit 10(iii)(A)(47) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018.* | ||
2014 PIP Performance Share Award Agreement is incorporated by reference to Exhibit 10(iii)(A)(61) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2014.* | ||
2014 PIP Performance Share Award Agreement (updated 2018) is incorporated by reference to Exhibit 10(iii)(A)(48) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2017.* | ||
2014 PIP Performance Share Award Agreement (updated 2019) is incorporated by reference to Exhibit 10(iii)(A)(50) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018.* | ||
2014 PIP Performance Cash Award Agreement is incorporated by reference to Exhibit 10(iii)(A)(62) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2014.* | ||
2014 PIP Performance Cash Award Agreement (updated 2018) is incorporated by reference to Exhibit 10(iii)(A)(50) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2017.* | ||
2014 PIP Performance Cash Award Agreement (updated 2019) is incorporated by reference to Exhibit 10(iii)(A)(53) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018.* | ||
The Interpublic Group 2019 Performance Incentive Plan (the “2019 PIP”). * | ||
2019 PIP Restricted Stock Award Agreement.* | ||
2019 PIP Restricted Stock Unit Award Agreement.* | ||
2019 PIP Restricted Stock Unit Award Agreement (version2).* | ||
2019 PIP Performance Share Award Agreement.* | ||
2019 PIP Performance Share Award Agreement (version 2).* | ||
2019 PIP Performance Cash Award Agreement.* | ||
2019 PIP Performance Cash Award Agreement (version 2).* | ||
The Restricted Cash Plan, as Amended and Restated as of May 18, 2009 is incorporated by reference to Exhibit 10(iii)(A)(13) to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2009. * | ||
Restricted Cash Award Agreement.* | ||
The Interpublic Senior Executive Incentive Plan is incorporated by reference to Exhibit 10(iii)(a)(7) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.* | ||
The Employee Stock Purchase Plan (2016) of the Registrant is incorporated by reference to Exhibit 4.4 to the Registrant's Registration Statement on Form S-8 filed with the SEC on December 21, 2015.* | ||
The Interpublic Group Executive Performance (162(m) Plan) is incorporated by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K filed with the SEC on May 28, 2014.* | ||
The Interpublic Executive Severance Plan, amended and restated, effective August 16, 2017, is incorporated by reference to Exhibit 10(iii)(A)(1) to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2017.* | ||
The Interpublic Senior Executive Retirement Income Plan, Amended and Restated (the "Restated SERIP"), effective January 1, 2007, is incorporated by reference to Exhibit 10(iii)(A)(1) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.* | ||
Exhibit No. | Description | |
Restated SERIP - Form of Restated Participation Agreement is incorporated by reference to Exhibit 10(iii)(A)(2) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.* | ||
Restated SERIP - Form of Participation Agreement (Form For New Participants) is incorporated by reference to Exhibit 10(iii)(A)(3) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.* | ||
The Interpublic Senior Executive Retirement Income Plan, amended and restated, effective August 1, 2014, and form of Participation Agreement for New Participants is incorporated by reference to Exhibit 10(iii)(A)(2) to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2014.* | ||
The Interpublic Capital Accumulation Plan, Amended and Restated (the “Restated CAP”), effective January 1, 2007, is incorporated by reference to Exhibit 10(iii)(A)(4) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.* | ||
Restated CAP - Form of Restated Participation Agreement is incorporated by reference to Exhibit 10(iii)(A)(5) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.* | ||
Restated CAP - Form of Participation Agreement (Form For New Participants), is incorporated by reference to Exhibit 10(iii)(A)(6) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.* | ||
The Interpublic Capital Accumulation Plan, amended and restated, effective August 1, 2014, and form of Participation Agreement for New Participants is incorporated by reference to Exhibit 10(iii)(A)(1) to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2014.* | ||
Description of Changes to the Compensation for Non-Management Directors, is incorporated by reference to Exhibit 10(iii)(A)(69) to the Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2015.* | ||
Subsidiaries of the Registrant. | ||
Consent of PricewaterhouseCoopers LLP. | ||
Power of Attorney to sign Form 10-K and resolution of Board of Directors re Power of Attorney. | ||
Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended. | ||
Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended. | ||
Certification of the Chief Executive Officer and the Chief Financial Officer furnished pursuant to 18 U.S.C. Section 1350 and Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. | ||
101 | Interactive Data File, for the period ended December 31, 2019. The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document. | |
104 | Cover Page Interactive Data File. The cover page XBRL tags are embedded within the inline XBRL document and are included in Exhibit 101. | |
* | Management contracts and compensation plans and arrangements. |
THE INTERPUBLIC GROUP OF COMPANIES, INC. | ||
(Registrant) | ||
By | /s/ Michael I. Roth | |
Michael I. Roth Chairman of the Board and Chief Executive Officer |
Name | Title | Date |
/s/ Michael I. Roth | Chairman of the Board and Chief Executive Officer (Principal Executive Officer) | February 21, 2020 |
Michael I. Roth | ||
/s/ Ellen Johnson | Executive Vice President and Chief Financial Officer (Principal Financial Officer) | February 21, 2020 |
Ellen Johnson | ||
/s/ Christopher F. Carroll | Senior Vice President, Controller and Chief Accounting Officer (Principal Accounting Officer) | February 21, 2020 |
Christopher F. Carroll | ||
/s/ Jocelyn Carter-Miller | Director | February 21, 2020 |
Jocelyn Carter-Miller | ||
/s/ H. John Greeniaus | Director | February 21, 2020 |
H. John Greeniaus | ||
/s/ Mary J. Steele Guilfoile | Director | February 21, 2020 |
Mary J. Steele Guilfoile | ||
/s/ Dawn Hudson | Director | February 21, 2020 |
Dawn Hudson | ||
/s/ William T. Kerr | Director | February 21, 2020 |
William T. Kerr | ||
/s/ Henry S. Miller | Director | February 21, 2020 |
Henry S. Miller | ||
/s/ Jonathan F. Miller | Director | February 21, 2020 |
Jonathan F. Miller | ||
/s/ Patrick Q. Moore | Director | February 21, 2020 |
Patrick Q. Moore | ||
/s/ Linda S. Sanford | Director | February 21, 2020 |
Linda Sanford | ||
/s/ David M. Thomas | Director | February 21, 2020 |
David M. Thomas | ||
/s/ E. Lee Wyatt Jr. | Director | February 21, 2020 |
E. Lee Wyatt Jr. |
Section 1. | Purpose. |
(1) | Any person (within the meaning of Sections 13(d) and 14(d) of the Exchange Act becomes the beneficial owner (within the meaning of Rule 13d-3 under the Exchange Act) of stock that, together with other stock held by such person, possesses more than 50 percent of the combined voting power of the Company's then-outstanding stock; |
(2) | Any person (within the meaning of Sections 13(d) and 14(d) of the Exchange Act) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person) ownership of stock of the Company possessing 30 percent or more of the combined voting power of the Company's then-outstanding stock; |
(3) | Any person (within the meaning of Sections 13(d) and 14(d) of the Exchange Act) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person) assets from the Company that have a total gross fair market value equal to 40 percent or more of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions (where gross fair market value is determined without regard to any associated liabilities); or |
(4) | During any 12-month period, a majority of the members of the Board is replaced by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of their appointment or election. |
(1) | The acquisition of additional control of the Company by any person or persons acting as a group that is considered to “effectively control” the Company (within the meaning of guidance issued under Section 409A of the Code); or |
(2) | A transfer of assets to any entity controlled by the shareholders of the Company immediately after such transfer, including a transfer to (A) a shareholder of the Company (immediately before such transfer) in exchange for or with respect to its stock, (B) an entity, 50 percent or more of the total value or voting power of which is owned (immediately after such transfer) directly or indirectly by the Company, (C) a person or persons acting as a group that owns (immediately after such transfer) directly or indirectly 50 percent or more of the total value or voting power of all outstanding stock of the Company, or (D) an entity, at least 50 percent of the total value or voting power of which is owned (immediately after such transfer) directly or indirectly by a person described in clause (C), above. |
Section 3. | Administration. |
(1) | Options and SARs, |
(2) | Restricted Stock, |
(3) | Restricted Stock Units, |
(4) | Performance Shares, |
(5) | Performance Units, |
(6) | Other Stock-Based Awards, |
(7) | Performance Cash, |
(8) | Dividend Equivalents, and |
(9) | Shares in Lieu of Cash. |
(1) | 27,000,000 Shares, plus |
(2) | the following Shares previously subject to Awards granted under a Prior Plan but not issued: (A) Shares that, as of the Effective Date, are subject to outstanding Awards, to the extent such Shares are forfeited or otherwise not issued due to Termination, (B) Shares underlying Options and SARs that expire; (C) Shares that, as of the Effective Date, are subject to outstanding Full Value Awards that were accounted for in Shares but are settled in cash; (D) Shares that are surrendered or withheld from Share-settled Full-Value Awards to satisfy withholding of taxes; and (E) Shares that, as of the Effective Date, are subject to outstanding performance share awards, to the extent that the target number of Shares under the award exceeds the number of shares actually issued pursuant to the award. |
(1) | No individual Eligible Employee shall be granted, in any Plan Year, Options and/or SARs with respect to more than 2,000,000 Shares in the aggregate; |
(2) | No individual Eligible Employee shall be granted, in any Plan Year, grants of Restricted Stock and/or Restricted Stock Units with respect to more than 2,000,000 Shares in the aggregate; |
(3) | No individual Eligible Employee shall be granted, in any Plan Year, Performance Shares, Performance Units, or Other Stock-Based Awards that provide for more than 2,000,000 Shares in the aggregate; and |
(4) | No individual Eligible Employee shall be granted, in any Plan Year, Performance Cash in an amount of more than $10,000,000. |
(5) | No individual Non-Management Director shall be granted, in any Plan Year, Awards that, taken together with the Non-Management Director’s cash compensation for services rendered to the Company during the Plan Year, have a value on the date of grant that exceeds $1,000,000. |
(1) | Except as provided in paragraph (3) below, with respect to Options and SARs, the number of Shares covered by an Award shall count against the limitations prescribed by subsections (a) and (b), above, on the number of Shares available for award under the Plan only to the extent that such Shares are actually issued. |
(2) | If (A) an Award that was granted on or after the Effective Date is forfeited or otherwise terminates or is canceled without the delivery of Shares, or (B) on or after the Effective Date, Shares are surrendered or withheld from any Share-settled Full Value Award granted |
(3) | With respect to each Option and SAR, the number of Shares counted against the number of Shares available for award under the Plan shall equal the full number of Shares with respect to which the Award is exercised, before reduction for a SAR’s grant price, shares tendered or withheld to pay the Option exercise price, or shares tendered or withheld to satisfy tax withholding. |
(4) | The Shares issued under the Plan may be authorized and unissued Shares or treasury Shares. |
(1) | the number and kind of shares that thereafter may be made the subject of Awards, |
(2) | the number and kinds of shares that are subject to outstanding Awards, and |
(3) | the grant, exercise, or conversion price with respect to any of the foregoing. |
(1) | If the Participant is a Non-Management Director, three years after the Participant’s Termination. |
(2) | If (A) as of the Participant’s Termination, the Participant is age 55 or older and has completed 10 or more years of service with the Company and its Subsidiaries and Affiliates, and (B) the Participant’s Termination is not due to Cause or the Participant’s death or Disability, three years after the Participant’s Termination. |
(3) | If the Participant’s Termination is due to the Participant’s death (and the Participant is not a Non-Management Director), one year after the Participant’s death. |
(4) | If the Participant’s Termination is due to the Participant’s Disability (and the Participant is not a Non-Management Director), one year after the Participant’s Termination. |
(5) | If the Participant’s Termination is not due to Cause and not described in paragraph (1), (2), (3), or (4), above, three months after the Participant’s Termination. |
(6) | If the Participant’s Termination is for Cause, the Option or SAR shall be canceled immediately upon the Participant’s Termination and shall not be exercisable thereafter. |
(1) | Such Restricted Stock shall be forfeited, all rights with respect to such Restricted Stock shall immediately terminate without any payment of consideration by the Company, and all Shares of such Restricted Stock, if any, that had been delivered to, or held in custody for, the Participant shall be returned to the Company forthwith, accompanied by any instrument of transfer requested by the Company; and |
(2) | Such unvested Restricted Stock Units shall be immediately forfeited, and all of the rights of the Participant with respect to such Restricted Stock Units shall immediately terminate without any payment of consideration by the Company. |
(1) | Postpone the exercise of Awards, the issuance or delivery of Shares, the payment of cash under any Award, or any action permitted under the Plan to prevent the Company or any of its Subsidiaries or Affiliates from being denied an income tax benefit with respect to any Award, and/or |
(2) | Establish rules under which a Participant may elect to postpone receipt of Shares or cash under any Award. |
(1) | The Plan shall be operated, administered, and interpreted consistently with the intent to comply with (or to be exempt from) the requirements of Section 409A of the Code. If the Administrator or the Company determines that any provision of the Plan is or might be inconsistent with the restrictions imposed by Section 409A of the Code, the Plan shall be automatically amended (without further action) to the extent that the Administrator or the Company determines is necessary to bring it into compliance with the requirements of Section 409A of the Code. No provision of the Plan or any Award Agreement shall be interpreted or construed to transfer any liability for a failure to comply with the requirements of Section 409A of the Code from a Participant or other individual to the Company, any Subsidiary, any Affiliate, the Administrator, or any other entity or individual affiliated with the Company, the Subsidiaries, and the Affiliates. |
(2) | For any Participant who, as of the date on which his or her Termination of Employment occurs, is a “specified employee” (within the meaning of Section 409A(2)(B)(i) of the Code, as determined by Interpublic in accordance with Treas. Reg. § 1.409A-1(i)), the payment date for any Award that is subject to Section 409A and for which the payment trigger is the Participant’s Termination of Employment shall be no earlier than the Participant’s Delayed Start Date. For purposes of the Plan, the Participant’s Delayed Start Date shall be the earlier of (i) the Company’s first pay date for the seventh calendar month that starts after the Participant’s Termination of Employment or (y) a date determined by Interpublic that is within 90 days after the Participant’s death. |
Restrictions | Subject to the terms and conditions of this Agreement and the Plan, including but not limited to the restrictions set forth in Section 6 of the Plan, the Participant shall be the owner of record of the Shares granted under this Award and shall have all rights of a shareholder of the Company. |
Lapse of Restrictions | Subject to the terms and conditions of this Agreement and the Plan, the restrictions on the above-mentioned Shares of Restricted Stock shall lapse on the first anniversary of the date of Award. |
Section 83(b) Election | Ordinarily, restricted Shares are not subject to U.S. federal income or employment taxes until the restrictions are lifted. However, the Participant may make an election (a “Section 83(b) election”) to be taxed (for U.S. federal income and employment tax purposes) on the fair market value of the Shares when the Restricted Stock Award is granted. To make a Section 83(b) election, the Participant must file a Section 83(b) election with the IRS and the Company within 30 days after the date of the Restricted Stock Award set forth on the cover page. Please consult your tax adviser for more information about what to include in a Section 83(b) election and the consequences of making a Section 83(b) election. |
Death or Disability | If the Participant terminates his or her directorship due to Disability or death before the restrictions applicable to the Shares lapse, the Participant shall vest in a portion of the Award as follows: The vested portion of the Award shall equal a fraction (not to exceed 1.0), the numerator of which is the Participant’s number of completed months of directorship with the Company and its Subsidiaries or Affiliates from the Date of the Award to the Participant’s Termination, and the denominator of which is the number of months from the Date of the Award to the scheduled Date of Lapse of Restrictions (such resulting amount, the “Reduced Award”). |
Dividends | Any dividends or distributions that are paid with respect to the Shares granted under this Restricted Stock Award (regardless of whether such dividends are paid in cash or Shares) shall be subject to the same risk of forfeiture (and restrictions, if the dividends are paid in Shares) as applies to the Shares granted under this Award. For the avoidance of doubt, the Participant shall not be entitled to the payment of any dividends until the restrictions applicable to Shares granted under this Restricted Stock Award have lapsed. |
Compliance with Local Laws | Notwithstanding anything to the contrary contained in this Agreement, the Company may, in its sole discretion, settle the Award in the form of: (1) a cash payment to the extent settlement in Shares (a) is prohibited under local law, rules and regulations, (b) would require the Participant or the Company to obtain the approval of any governmental and/or regulatory body in the Participant's country of residence (and/or country of employment, if different), or (c) is administratively burdensome; or (2) Shares, but require the Participant to immediately sell such Shares (in which case, this Agreement shall give the Company the authority to issues sales instructions on behalf of the Participant). If the Participant is a resident of or employed in a country other than the United States, the Participant agrees, as a condition of the Award, to repatriate all payments attributable to the Award in accordance with local foreign exchange rules and regulations in the Participant's country of residence (and country of employment, if different). In addition, the Participant agrees to take any and all actions, and consents to any and all actions taken by the Company and the Participant's employer as may be required to allow the Company and the Participant's employer to comply with local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). Finally, the Participant agrees to take any and all actions that may be required to comply with the Participant's personal legal and tax obligations under local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). |
EU Age Discrimination Rules | If the Participant is resident of a country that is a member of the European Union, the grant of the Award and this Agreement are intended to comply with the age discrimination provisions of the EU Equal Treatment Framework Directive, as implemented into local law (the “Age Discrimination Rules”). To the extent that a court or tribunal of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, in whole or in part, under the Age Discrimination Rules, the Company, in its sole discretion, shall have the power and authority to revise or strike such provision to the minimum extent necessary to make it valid and enforceable to the full extent permitted under local law. |
Forfeiture of Award | Before accepting this Award, the Participant must disclose to the Company in writing all grants to the Participant of options, shares and other equity rights with respect to any Subsidiary of the Company ("Subsidiary Grants") that are still outstanding. Failure to disclose in writing the existence of any such outstanding Subsidiary Grants shall result in immediate cancellation and forfeiture of the Award set forth in this Agreement, unless the Administrator determines in its sole discretion that such failure was reasonable under the circumstances. |
Cancellation and Rescission for Prohibited Activity | Notwithstanding any other provision of the Plan or this Agreement, the Participant acknowledges and agrees that the Company may cancel, rescind, suspend, withhold, modify, amend or otherwise limit or restrict this Award (whether vested or not vested) at any time if the Participant is not in compliance with all applicable provisions of the Agreement and the Plan, or if the Participant engages in any “Prohibited Activity.” For purposes of this Agreement, “Prohibited Activity” means: (i) any activity that would enable the Company (or any Subsidiary or Affiliate) to terminate the Participant’s directorship for cause (as defined in the Plan or any directorship agreement or other plan or arrangement that covers the Participant); (ii) a material violation of any rule, policy or procedure of the Company (or any Subsidiary or Affiliate), including but not limited to the Code of Conduct of the Company (and any such Subsidiary or Affiliate); or (iii) before a Change of Control, any other conduct or act that the Company determines is injurious, detrimental or prejudicial to any interest of the Company. The Participant agrees that the cancellation and rescission provisions of this Agreement are reasonable and agrees not to challenge the reasonableness of such provisions, even where forfeiture of this Agreement is the penalty for violation; provided that the Participant may challenge the reasonableness of any forfeiture that occurs after a Change of Control. |
No Directorship or Employment Rights | The grant of the Award shall not be interpreted to form a directorship or employment contract between the Participant and the Company. |
Discretionary Nature of Award | The Participant acknowledges and agrees that the Plan is discretionary in nature. The grant of the Award under the Plan is a one-time benefit and does not create any contractual or other right to receive a grant of Restricted Stock or any other forms of award permitted under the Plan or other benefits in lieu thereof in the future. Any amendment, modification or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Participant's directorship. |
Extraordinary Benefit | The Participant's participation in the Plan is voluntary. The value of the Award and any other awards granted under the Plan is an extraordinary item of compensation outside the scope of the Participant's directorship. Any grant under the Plan, including the grant of the Award, is not part of the Participant's normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, holiday pay, pension, or retirement benefits or similar payments. |
Value of Benefit | The future value of the Award is unknown and cannot be predicted with certainty. The Company shall not be liable for any foreign exchange rate fluctuation, where applicable, between the Participant's local currency and the United States dollar that may affect the value of the Award or of any amounts due to the Participant pursuant to the settlement of the Award or the subsequent sale of any Shares acquired upon settlement. |
No Public Offering | The grant of the Award is not intended to be a public offering of securities in the Participant's country of residence (and country of employment, if different). The Company has not submitted any registration statement, prospectus or other filings with the local securities authorities (unless otherwise required under local law). No employee of the Company or its Subsidiaries or Affiliates is permitted to advise the Participant on whether the Participant should acquire Shares under the Plan and provide the Participant with any legal, tax or financial advice with respect to the grant of the Award. The acquisition of Shares involves certain risks, and the Participant should carefully consider all risk factors and tax considerations relevant to the acquisition and disposition of Shares under the Plan. Further, the Participant should carefully review all of the materials related to the Award and the Plan, and the Participant should consult with the Participant's personal legal, tax and financial advisors for professional advice in relation to the Participant's personal circumstances. |
Insider Trading Laws | By participating in the Plan, the Participant expressly agrees to comply with the Company’s insider trading policies and any other of its policies regarding insider trading or personal account dealing applicable to the Participant. Further, the Participant expressly acknowledges and agrees that, depending on the country of residence of the Participant or the Participant’s broker, or where Shares are listed, the Participant may be subject to insider trading restrictions and/or market abuse laws which may affect the Participant's ability to accept, acquire, sell or otherwise dispose of Shares, rights to Shares (e.g., Award) or rights linked to the value of Shares, during such times the Participant is considered to have “inside information” or similar types of information regarding the Company as defined by the laws or regulations in the applicable country. Local insider trading laws and regulations may prohibit the cancellation or amendment of orders the Participant places before the Participant possessed such information. Furthermore, the Participant may be prohibited from (a) disclosing such information to any third party (other than on a “need to know” basis) and (b) “tipping” third parties or causing them otherwise to buy or sell securities (including other directors and employees of the Company or any of its Subsidiaries or Affiliates). Any restriction under these laws or regulations is separate from and in addition to any restrictions that may be imposed under any applicable Company policies. The Participant expressly acknowledges and agrees that it is the Participant's responsibility to comply with any applicable restrictions, and the Participant should consult the Participant’s personal advisor for additional information on any trading restrictions that may apply to the Participant. |
Recoupment | Notwithstanding any other provision of this Agreement to the contrary, the Participant acknowledges and agrees that the Award, any Shares acquired pursuant thereto and/or any amount received with respect to any sale of such Shares are subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of any recoupment policy the Company may establish or adopt ("Recoupment Policy") and as the Recoupment Policy may be amended from time to time. The Participant agrees and consents to the Company's application, implementation and enforcement of (a) the Recoupment Policy, and (b) any provision of applicable law relating to cancellation, recoupment, rescission or payback of compensation and expressly agrees that the Company may take such actions as are necessary to effectuate the Recoupment Policy (as applicable to the Participant) or applicable law without further consent or action being required by the Participant. For purposes of the foregoing, the Participant expressly and explicitly authorizes the Company to issue instructions, on the Participant's behalf, to any brokerage firm and/or third party administrator engaged by the Company to hold the Participant's Shares and other amounts acquired under the Plan to re-convey, transfer or otherwise return such Shares and/or other amounts to the Company. To the extent that the terms of this Agreement and the Recoupment Policy conflict, the terms of the Recoupment Policy shall prevail. |
English Language | If the Participant is resident outside of the United States, the Participant acknowledges and agrees that it is the Participant's express intent that this Agreement, the Plan and all other documents, notices and legal proceedings entered into, given or instituted pursuant to the Award be drawn up in English. If the Participant receives this Agreement, the Plan or any other document related to the Award translated into a language other than English, and if the meaning of the translated version is different than the English version, the English version will control. |
Electronic Delivery | The Company may, in its sole discretion, decide to deliver any documents related to the Award or other awards granted to the Participant under the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company. |
Data Privacy | The Company is located at 909 Third Avenue, New York, New York 10022, United States of America and grants Awards under the Plan to employees and non-management directors of the Company and its Subsidiaries and Affiliates in its sole discretion. In conjunction with the Company’s grant of the Award under the Plan and its ongoing administration of such awards, the Company is providing the following information about its data collection, processing and transfer practices. In accepting the grant of the Awards, the Participant expressly and explicitly consents to the personal data activities as described herein. (a) Data Collection, Processing and Usage. The Company collects, processes and uses the Participant’s personal data, including the Participant’s name, home address, email address, telephone number, date of birth, social insurance number or other identification number, salary, citizenship, job title, any Shares or directorships held in the Company, and details of all Awards or any other equity compensation awards granted, canceled, exercised, vested, or outstanding in the Participant’s favor, which the Company receives from the Participant or the Participant’s employer. In granting the Awards under the Plan, the Company will collect the Participant’s personal data for purposes of allocating Shares in settlement of the Awards and implementing, administering and managing the Plan. The Company’s legal basis for the collection, processing and usage of the Participant’s personal data is the Participant’s consent. (b) Stock Plan Administration Service Provider. The Company transfers the Participant’s personal data to [UBS Financial Services, an independent service provider based in the United States of America], which assists the Company with the implementation, administration and management of the Plan (the “Stock Plan Administrator”). In the future, the Company may select a different Stock Plan Administrator and share the Participant’s personal data with another company that serves in a similar manner. The Stock Plan Administrator will open an account for the Participant to receive and trade Shares acquired under the Plan. The Participant will be asked to agree on separate terms and data processing practices with the Stock Plan Administrator, which is a condition to the Participant’s ability to participate in the Plan. (c) International Data Transfers. The Company and the Stock Plan Administrator are based in the United States of America. The Participant should note that the Participant’s country of residence may have enacted data privacy laws that are different from the United States of America. The Company’s legal basis for the transfer of the Participant’s personal data to the United States of America is the Participant’s consent. (d) Voluntariness and Consequences of Consent Denial or Withdrawal. The Participant’s participation in the Plan and his or her grant of consent is purely voluntary. The Participant may deny or withdraw his or her consent at any time. If the Participant does not consent, or if the Participant later withdraws his or her consent, the Participant may be unable to participate in the Plan. This would not affect the Participant’s existing employment or salary; instead, the Participant merely may forfeit the opportunities associated with the Plan. (e) Data Subjects Rights. The Participant may have a number of rights under the data privacy laws in the Participant’s country of residence. For example, the Participant’s rights may include the right to (i) request access or copies of personal data the Company processes, (ii) request rectification of incorrect data, (iii) request deletion of data, (iv) place restrictions on processing, (v) lodge complaints with competent authorities in the Participant’s country of residence, and/or (vi) request a list with the names and addresses of any potential recipients of the Participant’s personal data. To receive clarification regarding the Participant’s rights or to exercise his or her rights, the Participant should contact the Participant’s local HR manager. |
Successors and Assigns | The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Participant and the Participant's beneficiaries, executors or administrators. |
Addendum | Notwithstanding any provisions of this Agreement to the contrary, the Award shall be subject to any special terms and conditions for the Participant's country of residence (and country of employment, if different) set forth in an addendum to this Agreement (an “Addendum”). Further, if the Participant transfers the Participant's residence and/or employment to another country reflected in an Addendum to this Agreement at the time of transfer, the special terms and conditions for such country will apply to the Participant to the extent the Company determines, in its sole discretion, that the application of such terms and conditions is necessary or advisable in order to comply with local law or to facilitate the operation and administration of the award and the Plan (or the Company may establish alternative terms and conditions as may be necessary or advisable to accommodate the Participant's transfer). In all circumstances, any applicable Addendum shall constitute part of this Agreement. |
Additional Requirements | The Company reserves the right to impose other requirements on the Award, any Shares acquired pursuant to the Award and the Participant's participation in the Plan to the extent the Company determines, in its sole discretion, that such other requirements are necessary or advisable in order to comply with local law or to facilitate the operation and administration of the Award and the Plan. Such requirements may include (but are not limited to) requiring the Participant to sign any agreements or undertakings that may be necessary to accomplish the foregoing. |
Severability | The invalidity or unenforceability of any provision of the Plan or this Agreement will not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement will be severable and enforceable to the extent permitted by law. |
Interpretation and Construction | This Agreement and the Plan shall be construed and interpreted by the Administrator, in its sole discretion. Any interpretation or other determination by the Administrator (including, but not limited to, correction of any defect or omission and reconciliation of any inconsistency in the Agreement or the Plan) shall be binding and conclusive. All determinations regarding enforcement, waiver or modification of the cancellation and rescission and other provisions of this Agreement (including the provisions relating to death and Disability) shall be made in the Plan Administrator’s sole discretion. Determinations made under this Agreement and the Plan need not be uniform and may be made selectively among individuals, whether or not such individuals are similarly situated. |
Entire Understanding | This Agreement, the award letter (if any) from the Company, and the terms of the Plan constitute the entire understanding between the Participant and the Company and its Subsidiaries and Affiliates regarding this Award. Any prior agreements, commitments, or negotiations concerning this Award are superseded. |
Acknowledge and Agree | By accepting the grant of the Award, the Participant acknowledges that the Participant has read this Agreement, the Addendum to this Agreement (as applicable), and the Plan, and the Participant specifically accepts and agrees to the provisions therein. |
Date of Award | [DATE] | Participant's Name [NAME] | |
Number of RSUs | [X] | ||
Vesting of RSUs | Subject to the (i) terms of the Plan, (ii) the forfeiture, cancellation, and rescission provisions of this Agreement and (iii) Participant's execution of the restrictive covenant agreement that is attached hereto as Exhibit B, the scheduled Vesting Date for the RSUs is as provided in the Participant’s award letter. Except as otherwise provided in the Plan or this Agreement, any portion of this Award that is not vested on the date the Participant ceases to be an employee of the Company and its Subsidiaries and Affiliates shall be forfeited. | ||
Payment Date | Subject to the vesting conditions set forth herein and the terms of the Plan, the Payment Date shall occur during the calendar year prescribed by Section 6(f) of the Plan no later than the last day of the "applicable 2 ½ month period" as defined in Treas. Reg. Section 1.409A-1(b)(4)(i)(A), subject to the following: If the Participant dies before the Vesting Date, the Award shall be settled within 90 days after the Participant’s death; and If the Participant's employment terminates within 24 months after a Change of Control (and before the Vesting Date), the Award shall be settled (to the extent vested) at the time prescribed by the Change of Control provisions of this Agreement. |
Amount of RSU Payment | The vested RSUs shall be settled in Shares at the time set forth in the cover page, with each vested RSU (before withholding) equal to one Share. |
Tax Withholding | The Award is subject to withholding for taxes at the time and in the amount determined by the Company or the Participant’s employer. Regardless of any action the Company or the Participant's employer takes with respect to any or all income tax (including U.S. federal, state and local taxes and/or non-U.S. taxes), social insurance, payroll tax, payment on account or other tax-related withholding (“Tax-Related Items”), the Participant acknowledges that the ultimate liability for all Tax-Related Items legally due by the Participant is and remains the Participant's responsibility. Neither the Company nor the Participant's employer: (a) make any representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Award, including the grant of the Award, the vesting or settlement of the Award, the subsequent sale of any Shares acquired pursuant to the Award and the receipt of any dividends or dividend equivalents; or (b) commit to structure the terms of the grant or any aspect of the Award to reduce or eliminate the Participant's liability for Tax-Related Items. Unless prohibited or problematic under applicable law or otherwise may trigger adverse consequences to the Company or the Participant’s employer, the Participant may elect, via the Company's stock plan administrator, to pay any Tax-Related Items required to be withheld in connection with the Award via any of the following methods: (1) withholding a sufficient number of whole Shares from the Shares paid to the Participant as a result of the vesting and settlement of the Award having a fair market value equal to the amount of Tax-Related Items to be withheld ("Share Withholding"); (2) selling a sufficient number of whole Shares from the Shares paid to the Participant as a result of the vesting and settlement of the Award having a fair market value equal to the amount of Tax-Related Items to be withheld; or (3) selling all of the Shares paid to the Participant as a result of the vesting and settlement of the Award, and withholding from the sale proceeds the amount of Tax-Related Items to be withheld, with the net proceeds disbursed to the Participant. Depending on the withholding method, the Company may withhold for Tax-Related Items by considering applicable statutory withholding amounts or other applicable withholding rates, including maximum applicable rates. To the extent the Participant fails to elect one of the foregoing withholding methods within [30] days of the Date of Award, the Company (or the Participant's employer) shall satisfy any withholding obligation for Tax-Related Items via Share Withholding. Notwithstanding the foregoing, if the Participant is subject to Section 16(b) of the Exchange Act, the Company will withhold using Share Withholding. If the Participant relocates to another jurisdiction, the Participant is responsible for notifying the Company of such relocation and is responsible for compliance with all applicable tax requirements. If the Participant is subject to taxation in more than one jurisdiction, the Participant acknowledges that the Company or the Participant's employer may be required to withhold or account for Tax-Related Items in more than one jurisdiction. By accepting this Award, the Participant expressly consents to the withholding methods as provided for hereunder. All other Tax-Related Items related to the Award and any Shares or cash delivered in settlement thereof are the Participant's sole responsibility. Neither the Company nor any of its Subsidiaries or Affiliates is responsible for any liability or penalty relating to taxes (including excise taxes) on compensation (including imputed compensation) or other income attributed to the Participant (or a Beneficiary) pursuant to this Agreement, whether as a result of the Participant failing to make timely payments of tax or otherwise. |
Change of Control | This Award shall not vest or become immediately payable merely upon the occurrence of a Change of Control. However, the following provisions shall apply if a Change of Control occurs before the Vesting Date: (i) If as a result of the Change of Control the Company ceases to exist or the Shares are no longer traded on the New York Stock Exchange, this Award shall be converted into a cash amount equal to the fair market value of the corresponding number of RSUs, based on the closing price of the Shares on the last day the Shares are traded on the New York Stock Exchange prior to the Change of Control. Such cash amount shall continue to be subject to the same risk of forfeiture and vesting conditions as applied prior to the conversion, and shall be payable during the calendar year prescribed by Section 6(f) of the Plan for settlement of RSUs, no later than the last day of the “applicable 2½-month period” as defined in Treas. Reg. § 1.409A-1(b)(4)(i)(A), except as otherwise provided in paragraph (ii), below. (ii) If prior to the Vesting Date and within 24 months after the Change of Control, the Participant has a Termination of Employment either (1) by the Company (including its successor) or the Participant’s employer without Cause or (2) if the Participant has “good reason” rights under the Company’s Executive Severance Plan or an employment agreement, by the Participant for “good reason” (as defined in the applicable plan or agreement), then (A) this Award shall become immediately vested and payable to the Participant, and (B) the Payment Date shall occur within 30 days after the Participant’s Termination of Employment (subject to the six-month delay rule set forth in Section 11(o)(2) of the Plan). |
Death or Disability | If the Participant terminates service due to Disability or death, the Participant shall vest in a portion of the Award as determined in accordance with the below: The vested portion of the Award shall equal a fraction (not to exceed 1.0), the numerator of which is the Participant’s number of completed months of service with the Company and its Subsidiaries or Affiliates from the Date of the Award to the Participant’s Termination of Service, and the denominator of which is the number of months from the Date of the Award to the scheduled Vesting Date (such resulting amount, the “Reduced Award”). |
Dividend Equivalents | The Participant shall be entitled to accrue Dividend Equivalents with respect to the Shares underlying the RSUs. For each Share, the Participant shall accrue a right to receive cash or share dividends for which the record date is after the Date of the Award and before the Award is settled. Such amounts shall be subject to the same forfeiture and vesting conditions as the underlying Shares, and shall be paid (if at all) at the same time as the RSUs are settled, applying the same vesting percentage as applies for the Shares. |
Compliance with Local Laws | Notwithstanding anything to the contrary contained in this Agreement, the Company may, in its sole discretion, settle the Award in the form of: (1) a cash payment to the extent settlement in Shares (a) is prohibited under local law, rules and regulations, (b) would require the Participant, the Company or the Participant's employer to obtain the approval of any governmental and/or regulatory body in the Participant's country of residence (and/or country of employment, if different), or (c) is administratively burdensome; or (2) Shares, but require the Participant to immediately sell such Shares (in which case, this Agreement shall give the Company the authority to issues sales instructions on behalf of the Participant). If the Participant is a resident of or employed in a country other than the United States, the Participant agrees, as a condition of the Award, to repatriate all payments attributable to the Award in accordance with local foreign exchange rules and regulations in the Participant's country of residence (and country of employment, if different). In addition, the Participant agrees to take any and all actions, and consents to any and all actions taken by the Company and the Participant's employer as may be required to allow the Company and the Participant's employer to comply with local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). Finally, the Participant agrees to take any and all actions that may be required to comply with the Participant's personal legal and tax obligations under local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). |
EU Age Discrimination Rules | If the Participant is resident and/or employed in a country that is a member of the European Union, the grant of the Award and this Agreement are intended to comply with the age discrimination provisions of the EU Equal Treatment Framework Directive, as implemented into local law (the “Age Discrimination Rules”). To the extent that a court or tribunal of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, in whole or in part, under the Age Discrimination Rules, the Company, in its sole discretion, shall have the power and authority to revise or strike such provision to the minimum extent necessary to make it valid and enforceable to the full extent permitted under local law. |
Forfeiture of Award | Before accepting this Award, the Participant must disclose to the Company in writing all grants to the Participant of options, shares and other equity rights with respect to any Subsidiary of the Company ("Subsidiary Grants") that are still outstanding. Failure to disclose in writing the existence of any such outstanding Subsidiary Grants shall result in immediate cancellation and forfeiture of the Award set forth in this Agreement, unless the Administrator determines in its sole discretion that such failure was reasonable under the circumstances. |
Cancellation and Rescission for Prohibited Activity | Notwithstanding any other provision of the Plan or this Agreement, the Participant acknowledges and agrees that the Company may cancel, rescind, suspend, withhold, modify, amend or otherwise limit or restrict this Award (whether vested or not vested) at any time if the Participant is not in compliance with all applicable provisions of the Agreement and the Plan, or if the Participant engages in any “Prohibited Activity.” For purposes of this Agreement, “Prohibited Activity” means: (i) any activity that would enable the Company (or any Subsidiary or Affiliate where the Participant is employed) to terminate the Participant’s employment for cause (as defined in the Plan or any employment agreement or other plan or arrangement that covers the Participant); (ii) a material violation of any rule, policy or procedure of the Company (or any Subsidiary or Affiliate where the Participant is employed), including but not limited to the Code of Conduct of the Company (and any such Subsidiary or Affiliate); (iii) before a Change of Control, a failure to be in compliance with any share ownership objectives of the Company applicable to the Participant, or (iv) before a Change of Control, any other conduct or act that the Company determines is injurious, detrimental or prejudicial to any interest of the Company. The Participant agrees that the cancellation and rescission provisions of this Agreement are reasonable and agrees not to challenge the reasonableness of such provisions, even where forfeiture of this Agreement is the penalty for violation; provided that the Participant may challenge the reasonableness of any forfeiture that occurs after a Change of Control. |
No Employment Rights | The grant of the Award shall not be interpreted to form an employment contract between the Participant and the Company or the Participant's employer. |
Discretionary Nature of Award | The Participant acknowledges and agrees that the Plan is discretionary in nature and may be amended, cancelled or terminated by the Company, in its sole discretion, at any time. The grant of the Award under the Plan is a one-time benefit and does not create any contractual or other right to receive a grant of RSUs or any other forms of award permitted under the Plan or other benefits in lieu thereof in the future. Future grants, if any, will be at the sole discretion of the Company, including, but not limited to, the form and timing of any grant, the Number of RSUs granted and the vesting provisions. Any amendment, modification or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Participant's employment with the Participant’s employer. |
Extraordinary Benefit | The Participant's participation in the Plan is voluntary. The value of the Award and any other awards granted under the Plan is an extraordinary item of compensation outside the scope of the Participant's employment (and the Participant's employment contract, if any). Any grant under the Plan, including the grant of the Award, is not part of the Participant's normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, holiday pay, pension, or retirement benefits or similar payments. |
Value of Benefit | The future value of the Award is unknown and cannot be predicted with certainty. The Company shall not be liable for any foreign exchange rate fluctuation, where applicable, between the Participant's local currency and the United States dollar that may affect the value of the Award or of any amounts due to the Participant pursuant to the settlement of the Award or the subsequent sale of any Shares acquired upon settlement. |
No Public Offering | The grant of the Award is not intended to be a public offering of securities in the Participant's country of residence (and country of employment, if different). The Company has not submitted any registration statement, prospectus or other filings with the local securities authorities (unless otherwise required under local law). No employee of the Company or its Subsidiaries or Affiliates is permitted to advise the Participant on whether the Participant should acquire Shares under the Plan and provide the Participant with any legal, tax or financial advice with respect to the grant of the Award. The acquisition of Shares involves certain risks, and the Participant should carefully consider all risk factors and tax considerations relevant to the acquisition and disposition of Shares under the Plan. Further, the Participant should carefully review all of the materials related to the Award and the Plan, and the Participant should consult with the Participant's personal legal, tax and financial advisors for professional advice in relation to the Participant's personal circumstances. |
Insider Trading Laws | By participating in the Plan, the Participant expressly agrees to comply with the Company’s insider trading policies and any other of its policies regarding insider trading or personal account dealing applicable to the Participant. Further, the Participant expressly acknowledges and agrees that, depending on the country of residence of the Participant or the Participant’s broker, or where Shares are listed, the Participant may be subject to insider trading restrictions and/or market abuse laws which may affect the Participant's ability to accept, acquire, sell or otherwise dispose of Shares, rights to Shares (e.g., Award) or rights linked to the value of Shares, during such times the Participant is considered to have “inside information” or similar types of information regarding the Company as defined by the laws or regulations in the applicable country. Local insider trading laws and regulations may prohibit the cancellation or amendment of orders the Participant places before the Participant possessed such information. Furthermore, the Participant may be prohibited from (a) disclosing such information to any third party (other than on a “need to know” basis) and (b) “tipping” third parties or causing them otherwise to buy or sell securities (including other employees of the Company or any of its Subsidiaries or Affiliates). Any restriction under these laws or regulations is separate from and in addition to any restrictions that may be imposed under any applicable Company policies. The Participant expressly acknowledges and agrees that it is the Participant's responsibility to comply with any applicable restrictions, and the Participant should consult the Participant’s personal advisor for additional information on any trading restrictions that may apply to the Participant. |
Recoupment | Notwithstanding any other provision of this Agreement to the contrary, the Participant acknowledges and agrees that the Award, any Shares acquired pursuant thereto and/or any amount received with respect to any sale of such Shares are subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of any recoupment policy the Company may establish or adopt ("Recoupment Policy") and as the Recoupment Policy may be amended from time to time. The Participant agrees and consents to the Company's application, implementation and enforcement of (a) the Recoupment Policy, and (b) any provision of applicable law relating to cancellation, recoupment, rescission or payback of compensation and expressly agrees that the Company may take such actions as are necessary to effectuate the Recoupment Policy (as applicable to the Participant) or applicable law without further consent or action being required by the Participant. For purposes of the foregoing, the Participant expressly and explicitly authorizes the Company to issue instructions, on the Participant's behalf, to any brokerage firm and/or third party administrator engaged by the Company to hold the Participant's Shares and other amounts acquired under the Plan to re-convey, transfer or otherwise return such Shares and/or other amounts to the Company. To the extent that the terms of this Agreement and the Recoupment Policy conflict, the terms of the Recoupment Policy shall prevail. |
English Language | If the Participant is resident outside of the United States, the Participant acknowledges and agrees that it is the Participant's express intent that this Agreement, the Plan and all other documents, notices and legal proceedings entered into, given or instituted pursuant to the Award be drawn up in English. If the Participant receives this Agreement, the Plan or any other document related to the Award translated into a language other than English, and if the meaning of the translated version is different than the English version, the English version will control. |
Electronic Delivery | The Company may, in its sole discretion, decide to deliver any documents related to the Award or other awards granted to the Participant under the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company. |
Data Privacy | The Company is located at 909 Third Avenue, New York, New York 10022, United States of America and grants Awards under the Plan to employees of the Company and its Subsidiaries and Affiliates in its sole discretion. In conjunction with the Company’s grant of the Award under the Plan and its ongoing administration of such awards, the Company is providing the following information about its data collection, processing and transfer practices. In accepting the grant of the Awards, the Participant expressly and explicitly consents to the personal data activities as described herein. (a) Data Collection, Processing and Usage. The Company collects, processes and uses the Participant’s personal data, including the Participant’s name, home address, email address, telephone number, date of birth, social insurance number or other identification number, salary, citizenship, job title, any Shares or directorships held in the Company, and details of all Awards or any other equity compensation awards granted, canceled, exercised, vested, or outstanding in the Participant’s favor, which the Company receives from the Participant or the Participant’s employer. In granting the Awards under the Plan, the Company will collect the Participant’s personal data for purposes of allocating Shares in settlement of the Awards and implementing, administering and managing the Plan. The Company’s legal basis for the collection, processing and usage of the Participant’s personal data is the Participant’s consent. (b) Stock Plan Administration Service Provider. The Company transfers the Participant’s personal data to [UBS Financial Services, an independent service provider based in the United States of America], which assists the Company with the implementation, administration and management of the Plan (the “Stock Plan Administrator”). In the future, the Company may select a different Stock Plan Administrator and share the Participant’s personal data with another company that serves in a similar manner. The Stock Plan Administrator will open an account for the Participant to receive and trade Shares acquired under the Plan. The Participant will be asked to agree on separate terms and data processing practices with the Stock Plan Administrator, which is a condition to the Participant’s ability to participate in the Plan. (c) International Data Transfers. The Company and the Stock Plan Administrator are based in the United States of America. The Participant should note that the Participant’s country of residence may have enacted data privacy laws that are different from the United States of America. The Company’s legal basis for the transfer of the Participant’s personal data to the United States of America is the Participant’s consent. (d) Voluntariness and Consequences of Consent Denial or Withdrawal. The Participant’s participation in the Plan and his or her grant of consent is purely voluntary. The Participant may deny or withdraw his or her consent at any time. If the Participant does not consent, or if the Participant later withdraws his or her consent, the Participant may be unable to participate in the Plan. This would not affect the Participant’s existing employment or salary; instead, the Participant merely may forfeit the opportunities associated with the Plan. (e) Data Subjects Rights. The Participant may have a number of rights under the data privacy laws in the Participant’s country of residence. For example, the Participant’s rights may include the right to (i) request access or copies of personal data the Company processes, (ii) request rectification of incorrect data, (iii) request deletion of data, (iv) place restrictions on processing, (v) lodge complaints with competent authorities in the Participant’s country of residence, and/or (vi) request a list with the names and addresses of any potential recipients of the Participant’s personal data. To receive clarification regarding the Participant’s rights or to exercise his or her rights, the Participant should contact the Participant’s local HR manager. |
Successors and Assigns | The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Participant and the Participant's beneficiaries, executors or administrators. |
Addendum | Notwithstanding any provisions of this Agreement to the contrary, the Award shall be subject to any special terms and conditions for the Participant's country of residence (and country of employment, if different) set forth in an addendum to this Agreement (an “Addendum”). Further, if the Participant transfers the Participant's residence and/or employment to another country reflected in an Addendum to this Agreement at the time of transfer, the special terms and conditions for such country will apply to the Participant to the extent the Company determines, in its sole discretion, that the application of such terms and conditions is necessary or advisable in order to comply with local law or to facilitate the operation and administration of the award and the Plan (or the Company may establish alternative terms and conditions as may be necessary or advisable to accommodate the Participant's transfer). In all circumstances, any applicable Addendum shall constitute part of this Agreement. |
Additional Requirements | The Company reserves the right to impose other requirements on the Award, any Shares acquired pursuant to the Award and the Participant's participation in the Plan to the extent the Company determines, in its sole discretion, that such other requirements are necessary or advisable in order to comply with local law or to facilitate the operation and administration of the Award and the Plan. Such requirements may include (but are not limited to) requiring the Participant to sign any agreements or undertakings that may be necessary to accomplish the foregoing. |
Severability | The invalidity or unenforceability of any provision of the Plan or this Agreement will not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement will be severable and enforceable to the extent permitted by law. |
Interpretation and Construction | This Agreement and the Plan shall be construed and interpreted by the Administrator, in its sole discretion. Any interpretation or other determination by the Administrator (including, but not limited to, correction of any defect or omission and reconciliation of any inconsistency in the Agreement or the Plan) shall be binding and conclusive. All determinations regarding enforcement, waiver or modification of the cancellation and rescission and other provisions of this Agreement (including the provisions relating to termination of service, death and Disability) shall be made in the Company’s sole discretion. Determinations made under this Agreement and the Plan need not be uniform and may be made selectively among individuals, whether or not such individuals are similarly situated. |
Entire Understanding | This Agreement, the award letter (if any) from the Company, the terms of the Plan and the restrictive covenant agreement attached hereto as Exhibit B constitute the entire understanding between the Participant and the Company and its Subsidiaries and Affiliates regarding this Award. Any prior agreements, commitments, or negotiations concerning this Award are superseded. |
Participant’s Acknowledgement and Agreement | By accepting the grant of the Award, the Participant acknowledges that the Participant has read this Agreement, the Addendum to this Agreement (as applicable), the Plan, and the restrictive covenant agreement and the Participant specifically accepts and agrees to the provisions therein. |
Date of Award | [DATE] | Participant's Name [NAME] | |
Number of RSUs | [X] | ||
Vesting of RSUs | Subject to the (i) terms of the Plan, (ii) the retirement, forfeiture, cancellation, and rescission provisions of this Agreement and (iii) Participant's execution of the restrictive covenant agreement that is attached hereto as Exhibit B, the scheduled Vesting Date for the RSUs is as provided in the Participant’s award letter. Except as otherwise provided in the Plan or this Agreement, any portion of this Award that is not vested on the date the Participant ceases to be an employee of the Company and its Subsidiaries and Affiliates shall be forfeited. | ||
Payment Date | Subject to the vesting conditions set forth herein and the terms of the Plan, the Payment Date shall occur during the calendar year in which the Vesting Date occurs, subject to the following: If the Participant dies before the Vesting Date, the Award shall be settled within 90 days after the Participant’s death; and If the Participant's employment terminates within 24 months after a Change of Control (and before the Vesting Date), the Award shall be settled (to the extent vested) at the time prescribed by the Change of Control provisions of this Agreement. | ||
Amount of RSU Payment | The vested RSUs shall be settled in Shares at the time set forth in the cover page, with each vested RSU (before withholding) equal to one Share. |
Tax Withholding | The Award is subject to withholding for taxes at the time and in the amount determined by the Company or the Participant’s employer. Regardless of any action the Company or the Participant's employer takes with respect to any or all income tax (including U.S. federal, state and local taxes and/or non-U.S. taxes), social insurance, payroll tax, payment on account or other tax-related withholding (“Tax-Related Items”), the Participant acknowledges that the ultimate liability for all Tax-Related Items legally due by the Participant is and remains the Participant's responsibility. Neither the Company nor the Participant's employer: (a) make any representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Award, including the grant of the Award, the vesting or settlement of the Award, the subsequent sale of any Shares acquired pursuant to the Award and the receipt of any dividends or dividend equivalents; or (b) commit to structure the terms of the grant or any aspect of the Award to reduce or eliminate the Participant's liability for Tax-Related Items. Unless prohibited or problematic under applicable law or otherwise may trigger adverse consequences to the Company or the Participant’s employer, the Participant may elect, via the Company's stock plan administrator, to pay any Tax-Related Items required to be withheld in connection with the Award via any of the following methods: (1) withholding a sufficient number of whole Shares from the Shares paid to the Participant as a result of the vesting and settlement of the Award having a fair market value equal to the amount of Tax-Related Items to be withheld ("Share Withholding"); (2) selling a sufficient number of whole Shares from the Shares paid to the Participant as a result of the vesting and settlement of the Award having a fair market value equal to the amount of Tax-Related Items to be withheld; or (3) selling all of the Shares paid to the Participant as a result of the vesting and settlement of the Award, and withholding from the sale proceeds the amount of Tax-Related Items to be withheld, with the net proceeds disbursed to the Participant. Depending on the withholding method, the Company may withhold for Tax-Related Items by considering applicable statutory withholding amounts or other applicable withholding rates, including maximum applicable rates. To the extent the Participant fails to elect one of the foregoing withholding methods within [30] days of the Date of Award, the Company (or the Participant's employer) shall satisfy any withholding obligation for Tax-Related Items via Share Withholding. Notwithstanding the foregoing, if the Participant is subject to Section 16(b) of the Exchange Act, the Company will withhold using Share Withholding. If the Participant relocates to another jurisdiction, the Participant is responsible for notifying the Company of such relocation and is responsible for compliance with all applicable tax requirements. If the Participant is subject to taxation in more than one jurisdiction, the Participant acknowledges that the Company or the Participant's employer may be required to withhold or account for Tax-Related Items in more than one jurisdiction. By accepting this Award, the Participant expressly consents to the withholding methods as provided for hereunder. All other Tax-Related Items related to the Award and any Shares or cash delivered in settlement thereof are the Participant's sole responsibility. Neither the Company nor any of its Subsidiaries or Affiliates is responsible for any liability or penalty relating to taxes (including excise taxes) on compensation (including imputed compensation) or other income attributed to the Participant (or a Beneficiary) pursuant to this Agreement, whether as a result of the Participant failing to make timely payments of tax or otherwise. |
Change of Control | This Award shall not vest or become immediately payable merely upon the occurrence of a Change of Control. However, the following provisions shall apply if a Change of Control occurs before the Vesting Date: (i) If as a result of the Change of Control the Company ceases to exist or the Shares are no longer traded on the New York Stock Exchange, this Award shall be converted into a cash amount equal to the fair market value of the corresponding number of RSUs, based on the closing price of the Shares on the last day the Shares are traded on the New York Stock Exchange prior to the Change of Control. Such cash amount shall continue to be subject to the same risk of forfeiture and vesting conditions as applied prior to the conversion, and shall be payable on the Payment Date prescribed by this Agreement, except as otherwise provided in paragraph (ii), below. (ii) If prior to the Vesting Date and within 24 months after the Change of Control, the Participant has a Termination of Employment either (1) by the Company (including its successor) or the Participant’s employer without Cause or (2) if the Participant has “good reason” rights under the Company’s Executive Severance Plan or an employment agreement, by the Participant for “good reason” (as defined in the applicable plan or agreement), then (A) this Award shall become immediately vested and payable to the Participant, and (B) the Payment Date shall occur within 30 days after the Participant’s Termination of Employment (subject to the six-month delay rule set forth in Section 11(o)(2) of the Plan). |
Retirement | If the Participant terminates service due to Retirement (as defined below) prior to the Vesting Date, the Participant shall vest in a portion of the Award. The vested percentage shall equal a fraction (not to exceed 1.0), the numerator of which is the Participant’s number of completed months of service with the Company, its Subsidiaries or Affiliates from the Date of the Award to the Participant’s Termination of Service, and the denominator of which is the number of months from the Date of the Award to the scheduled Vesting Date (such resulting amount, the “Reduced Award”). Such Reduced Award shall be paid on the Payment Date prescribed by this Agreement (i.e., payment shall not be accelerated), and any portion of the Award that is not vested shall be forfeited without consideration. For purposes of this Agreement, “Retirement” means a voluntary Termination of Service with the Company’s approval after the Participant has attained age 55 and ten (10) years of matching contribution service under the Interpublic Group of Companies, Inc. Savings Plan (or, if the Participant is not eligible to participate in the Interpublic Group of Companies, Inc. Savings Plan, vesting service under the Participant’s employer’s 401(k) plan). For purposes of this Agreement, “Termination of Service” means the date the Participant ceases to provide material services to the Company and its Affiliates and Subsidiaries, which includes service as an employee, board member or consultant, as determined by the Company in its sole discretion. |
Death or Disability | If the Participant terminates service due to Disability or death, the Participant shall vest in a portion of the Award as determined in accordance with the below: The vested portion of the Award shall equal a fraction (not to exceed 1.0), the numerator of which is the Participant’s number of completed months of service with the Company and its Subsidiaries or Affiliates from the Date of the Award to the Participant’s Termination of Service, and the denominator of which is the number of months from the Date of the Award to the scheduled Vesting Date (such resulting amount, the “Reduced Award”). |
Dividend Equivalents | The Participant shall be entitled to accrue Dividend Equivalents with respect to the Shares underlying the RSUs. For each Share, the Participant shall accrue a right to receive cash or share dividends for which the record date is after the Date of the Award and before the Award is settled. Such amounts shall be subject to the same forfeiture and vesting conditions as the underlying Shares, and shall be paid (if at all) at the same time as the RSUs are settled, applying the same vesting percentage as applies for the Shares. |
Compliance with Local Laws | Notwithstanding anything to the contrary contained in this Agreement, the Company may, in its sole discretion, settle the Award in the form of: (1) a cash payment to the extent settlement in Shares (a) is prohibited under local law, rules and regulations, (b) would require the Participant, the Company or the Participant's employer to obtain the approval of any governmental and/or regulatory body in the Participant's country of residence (and/or country of employment, if different), or (c) is administratively burdensome; or (2) Shares, but require the Participant to immediately sell such Shares (in which case, this Agreement shall give the Company the authority to issues sales instructions on behalf of the Participant). If the Participant is a resident of or employed in a country other than the United States, the Participant agrees, as a condition of the Award, to repatriate all payments attributable to the Award in accordance with local foreign exchange rules and regulations in the Participant's country of residence (and country of employment, if different). In addition, the Participant agrees to take any and all actions, and consents to any and all actions taken by the Company and the Participant's employer as may be required to allow the Company and the Participant's employer to comply with local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). Finally, the Participant agrees to take any and all actions that may be required to comply with the Participant's personal legal and tax obligations under local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). |
EU Age Discrimination Rules | If the Participant is resident and/or employed in a country that is a member of the European Union, the grant of the Award and this Agreement are intended to comply with the age discrimination provisions of the EU Equal Treatment Framework Directive, as implemented into local law (the “Age Discrimination Rules”). To the extent that a court or tribunal of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, in whole or in part, under the Age Discrimination Rules, the Company, in its sole discretion, shall have the power and authority to revise or strike such provision to the minimum extent necessary to make it valid and enforceable to the full extent permitted under local law. |
Forfeiture of Award | Before accepting this Award, the Participant must disclose to the Company in writing all grants to the Participant of options, shares and other equity rights with respect to any Subsidiary of the Company ("Subsidiary Grants") that are still outstanding. Failure to disclose in writing the existence of any such outstanding Subsidiary Grants shall result in immediate cancellation and forfeiture of the Award set forth in this Agreement, unless the Administrator determines in its sole discretion that such failure was reasonable under the circumstances. |
Cancellation and Rescission for Prohibited Activity | Notwithstanding any other provision of the Plan or this Agreement, the Participant acknowledges and agrees that the Company may cancel, rescind, suspend, withhold, modify, amend or otherwise limit or restrict this Award (whether vested or not vested) at any time if the Participant is not in compliance with all applicable provisions of the Agreement and the Plan, or if the Participant engages in any “Prohibited Activity.” For purposes of this Agreement, “Prohibited Activity” means: (i) any activity that would enable the Company (or any Subsidiary or Affiliate where the Participant is employed) to terminate the Participant’s employment for cause (as defined in the Plan or any employment agreement or other plan or arrangement that covers the Participant); (ii) a material violation of any rule, policy or procedure of the Company (or any Subsidiary or Affiliate where the Participant is employed), including but not limited to the Code of Conduct of the Company (and any such Subsidiary or Affiliate); (iii) before a Change of Control, a failure to be in compliance with any share ownership objectives of the Company applicable to the Participant, or (iv) before a Change of Control, any other conduct or act that the Company determines is injurious, detrimental or prejudicial to any interest of the Company. The Participant agrees that the cancellation and rescission provisions of this Agreement are reasonable and agrees not to challenge the reasonableness of such provisions, even where forfeiture of this Agreement is the penalty for violation; provided that the Participant may challenge the reasonableness of any forfeiture that occurs after a Change of Control. |
No Employment Rights | The grant of the Award shall not be interpreted to form an employment contract between the Participant and the Company or the Participant's employer. |
Discretionary Nature of Award | The Participant acknowledges and agrees that the Plan is discretionary in nature and may be amended, cancelled or terminated by the Company, in its sole discretion, at any time. The grant of the Award under the Plan is a one-time benefit and does not create any contractual or other right to receive a grant of RSUs or any other forms of award permitted under the Plan or other benefits in lieu thereof in the future. Future grants, if any, will be at the sole discretion of the Company, including, but not limited to, the form and timing of any grant, the Number of RSUs granted and the vesting provisions. Any amendment, modification or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Participant's employment with the Participant’s employer. |
Extraordinary Benefit | The Participant's participation in the Plan is voluntary. The value of the Award and any other awards granted under the Plan is an extraordinary item of compensation outside the scope of the Participant's employment (and the Participant's employment contract, if any). Any grant under the Plan, including the grant of the Award, is not part of the Participant's normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, holiday pay, pension, or retirement benefits or similar payments. |
Value of Benefit | The future value of the Award is unknown and cannot be predicted with certainty. The Company shall not be liable for any foreign exchange rate fluctuation, where applicable, between the Participant's local currency and the United States dollar that may affect the value of the Award or of any amounts due to the Participant pursuant to the settlement of the Award or the subsequent sale of any Shares acquired upon settlement. |
No Public Offering | The grant of the Award is not intended to be a public offering of securities in the Participant's country of residence (and country of employment, if different). The Company has not submitted any registration statement, prospectus or other filings with the local securities authorities (unless otherwise required under local law). No employee of the Company or its Subsidiaries or Affiliates is permitted to advise the Participant on whether the Participant should acquire Shares under the Plan and provide the Participant with any legal, tax or financial advice with respect to the grant of the Award. The acquisition of Shares involves certain risks, and the Participant should carefully consider all risk factors and tax considerations relevant to the acquisition and disposition of Shares under the Plan. Further, the Participant should carefully review all of the materials related to the Award and the Plan, and the Participant should consult with the Participant's personal legal, tax and financial advisors for professional advice in relation to the Participant's personal circumstances. |
Insider Trading Laws | By participating in the Plan, the Participant expressly agrees to comply with the Company’s insider trading policies and any other of its policies regarding insider trading or personal account dealing applicable to the Participant. Further, the Participant expressly acknowledges and agrees that, depending on the country of residence of the Participant or the Participant’s broker, or where Shares are listed, the Participant may be subject to insider trading restrictions and/or market abuse laws which may affect the Participant's ability to accept, acquire, sell or otherwise dispose of Shares, rights to Shares (e.g., Award) or rights linked to the value of Shares, during such times the Participant is considered to have “inside information” or similar types of information regarding the Company as defined by the laws or regulations in the applicable country. Local insider trading laws and regulations may prohibit the cancellation or amendment of orders the Participant places before the Participant possessed such information. Furthermore, the Participant may be prohibited from (a) disclosing such information to any third party (other than on a “need to know” basis) and (b) “tipping” third parties or causing them otherwise to buy or sell securities (including other employees of the Company or any of its Subsidiaries or Affiliates). Any restriction under these laws or regulations is separate from and in addition to any restrictions that may be imposed under any applicable Company policies. The Participant expressly acknowledges and agrees that it is the Participant's responsibility to comply with any applicable restrictions, and the Participant should consult the Participant’s personal advisor for additional information on any trading restrictions that may apply to the Participant. |
Recoupment | Notwithstanding any other provision of this Agreement to the contrary, the Participant acknowledges and agrees that the Award, any Shares acquired pursuant thereto and/or any amount received with respect to any sale of such Shares are subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of any recoupment policy the Company may establish or adopt ("Recoupment Policy") and as the Recoupment Policy may be amended from time to time. The Participant agrees and consents to the Company's application, implementation and enforcement of (a) the Recoupment Policy, and (b) any provision of applicable law relating to cancellation, recoupment, rescission or payback of compensation and expressly agrees that the Company may take such actions as are necessary to effectuate the Recoupment Policy (as applicable to the Participant) or applicable law without further consent or action being required by the Participant. For purposes of the foregoing, the Participant expressly and explicitly authorizes the Company to issue instructions, on the Participant's behalf, to any brokerage firm and/or third party administrator engaged by the Company to hold the Participant's Shares and other amounts acquired under the Plan to re-convey, transfer or otherwise return such Shares and/or other amounts to the Company. To the extent that the terms of this Agreement and the Recoupment Policy conflict, the terms of the Recoupment Policy shall prevail. |
English Language | If the Participant is resident outside of the United States, the Participant acknowledges and agrees that it is the Participant's express intent that this Agreement, the Plan and all other documents, notices and legal proceedings entered into, given or instituted pursuant to the Award be drawn up in English. If the Participant receives this Agreement, the Plan or any other document related to the Award translated into a language other than English, and if the meaning of the translated version is different than the English version, the English version will control. |
Electronic Delivery | The Company may, in its sole discretion, decide to deliver any documents related to the Award or other awards granted to the Participant under the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company. |
Data Privacy | The Company is located at 909 Third Avenue, New York, New York 10022, United States of America and grants Awards under the Plan to employees of the Company and its Subsidiaries and Affiliates in its sole discretion. In conjunction with the Company’s grant of the Award under the Plan and its ongoing administration of such awards, the Company is providing the following information about its data collection, processing and transfer practices. In accepting the grant of the Awards, the Participant expressly and explicitly consents to the personal data activities as described herein. (a) Data Collection, Processing and Usage. The Company collects, processes and uses the Participant’s personal data, including the Participant’s name, home address, email address, telephone number, date of birth, social insurance number or other identification number, salary, citizenship, job title, any Shares or directorships held in the Company, and details of all Awards or any other equity compensation awards granted, canceled, exercised, vested, or outstanding in the Participant’s favor, which the Company receives from the Participant or the Participant’s employer. In granting the Awards under the Plan, the Company will collect the Participant’s personal data for purposes of allocating Shares in settlement of the Awards and implementing, administering and managing the Plan. The Company’s legal basis for the collection, processing and usage of the Participant’s personal data is the Participant’s consent. (b) Stock Plan Administration Service Provider. The Company transfers the Participant’s personal data to [UBS Financial Services, an independent service provider based in the United States of America], which assists the Company with the implementation, administration and management of the Plan (the “Stock Plan Administrator”). In the future, the Company may select a different Stock Plan Administrator and share the Participant’s personal data with another company that serves in a similar manner. The Stock Plan Administrator will open an account for the Participant to receive and trade Shares acquired under the Plan. The Participant will be asked to agree on separate terms and data processing practices with the Stock Plan Administrator, which is a condition to the Participant’s ability to participate in the Plan (c) International Data Transfers. The Company and the Stock Plan Administrator are based in the United States of America. The Participant should note that the Participant’s country of residence may have enacted data privacy laws that are different from the United States of America. The Company’s legal basis for the transfer of the Participant’s personal data to the United States of America is the Participant’s consent. (d) Voluntariness and Consequences of Consent Denial or Withdrawal. The Participant’s participation in the Plan and his or her grant of consent is purely voluntary. The Participant may deny or withdraw his or her consent at any time. If the Participant does not consent, or if the Participant later withdraws his or her consent, the Participant may be unable to participate in the Plan. This would not affect the Participant’s existing employment or salary; instead, the Participant merely may forfeit the opportunities associated with the Plan. (e) Data Subjects Rights. The Participant may have a number of rights under the data privacy laws in the Participant’s country of residence. For example, the Participant’s rights may include the right to (i) request access or copies of personal data the Company processes, (ii) request rectification of incorrect data, (iii) request deletion of data, (iv) place restrictions on processing, (v) lodge complaints with competent authorities in the Participant’s country of residence, and/or (vi) request a list with the names and addresses of any potential recipients of the Participant’s personal data. To receive clarification regarding the Participant’s rights or to exercise his or her rights, the Participant should contact the Participant’s local HR manager. |
Successors and Assigns | The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Participant and the Participant's beneficiaries, executors or administrators. |
Addendum | Notwithstanding any provisions of this Agreement to the contrary, the Award shall be subject to any special terms and conditions for the Participant's country of residence (and country of employment, if different) set forth in an addendum to this Agreement (an “Addendum”). Further, if the Participant transfers the Participant's residence and/or employment to another country reflected in an Addendum to this Agreement at the time of transfer, the special terms and conditions for such country will apply to the Participant to the extent the Company determines, in its sole discretion, that the application of such terms and conditions is necessary or advisable in order to comply with local law or to facilitate the operation and administration of the award and the Plan (or the Company may establish alternative terms and conditions as may be necessary or advisable to accommodate the Participant's transfer). In all circumstances, any applicable Addendum shall constitute part of this Agreement. |
Additional Requirements | The Company reserves the right to impose other requirements on the Award, any Shares acquired pursuant to the Award and the Participant's participation in the Plan to the extent the Company determines, in its sole discretion, that such other requirements are necessary or advisable in order to comply with local law or to facilitate the operation and administration of the Award and the Plan. Such requirements may include (but are not limited to) requiring the Participant to sign any agreements or undertakings that may be necessary to accomplish the foregoing. |
Severability | The invalidity or unenforceability of any provision of the Plan or this Agreement will not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement will be severable and enforceable to the extent permitted by law. |
Interpretation and Construction | This Agreement and the Plan shall be construed and interpreted by the Administrator, in its sole discretion. Any interpretation or other determination by the Administrator (including, but not limited to, correction of any defect or omission and reconciliation of any inconsistency in the Agreement or the Plan) shall be binding and conclusive. All determinations regarding enforcement, waiver or modification of the cancellation and rescission and other provisions of this Agreement (including the provisions relating to termination of service, death and Disability) shall be made in the Company’s sole discretion. Determinations made under this Agreement and the Plan need not be uniform and may be made selectively among individuals, whether or not such individuals are similarly situated. |
Entire Understanding | This Agreement, the award letter (if any) from the Company, the terms of the Plan and the restrictive covenant agreement attached hereto as Exhibit B constitute the entire understanding between the Participant and the Company and its Subsidiaries and Affiliates regarding this Award. Any prior agreements, commitments, or negotiations concerning this Award are superseded. |
Participant’s Acknowledgement and Agreement | By accepting the grant of the Award, the Participant acknowledges that the Participant has read this Agreement, the Addendum to this Agreement (as applicable), the Plan, and the restrictive covenant agreement and the Participant specifically accepts and agrees to the provisions therein. |
Date of Award | [DATE] | Participant's Name [NAME] | |
Target Number of Shares to be Awarded Upon Vesting | [X] | ||
Performance Period | [X] through [X] | ||
Vesting Date | Subject to the (i) terms of the Plan, (ii) the forfeiture, cancellation, and rescission provisions of this Agreement and (iii) the Participant's execution of the restrictive covenant agreement that is attached hereto as Exhibit B, the scheduled Vesting Date is as provided in the Participant's award letter, or such later date as specified in the following paragraph. Notwithstanding any other provision of this Agreement, if the audit of the Company's consolidated financial statements for the years included in the Performance Period (the "Audited Financials") has not been completed more than fifteen (15) days before the Vesting Date set forth above, the Vesting Date shall be delayed until the earlier of (i) the thirtieth (30th) day after the completion of the Audited Financials for the years included in the Performance Period or (ii) the date the Actual Shares Awarded (as defined below) are delivered. Except as otherwise provided in the Plan or this Agreement, any portion of this Award that is not vested on the date the Participant ceases to be an employee of the Company and its Subsidiaries and Affiliates shall be forfeited. | ||
Actual Shares Awarded | The "Actual Shares Awarded" (to the extent vested) shall be between 0 and 2 times the "Target Number of Shares to be Awarded Upon Vesting," as determined by the Administrator based on performance against financial metrics (the "Performance Objectives"). Although the Award is intended to be settled in Shares, the Actual Payment Amount may be paid in cash, shares, or a combination as prescribed in Section 7(b) of the Plan. | ||
Payment Date | The Award shall be settled during the calendar year prescribed by Section 7(b) of the Plan no later than the last day of the "applicable 2 ½ month period" as defined in Treas. Reg. Section 1.409A-1(b)(4)(i)(A), subject to the following: If the Participant dies before the Vesting Date, within 90 days after the Participant’s death; and If the Participant's employment terminates within 24 months after a Change of Control (and before the Vesting Date), the Award shall be settled at the time prescribed by the Change of Control provisions of this Agreement. |
Achievement of Performance Objectives | Subject to the terms of the Plan, the Administrator shall have sole and exclusive discretion to determine whether and the extent to which the applicable Performance Objectives has been achieved, and the corresponding number of Actual Shares Awarded. Except in the case of death or a Change of Control, the Award shall not vest and no payment shall be made pursuant to this Award unless the Administrator has certified in writing that the Performance Objectives and all other material terms of the Award have been satisfied. | |
Tax Withholding | The Award is subject to withholding for taxes at the time and in the amount determined by the Company or the Participant’s employer. Regardless of any action the Company or the Participant's employer takes with respect to any or all income tax (including U.S. federal, state and local taxes and/or non-U.S. taxes), social insurance, payroll tax, payment on account or other tax-related items resulting from the Award(“Tax-Related Items”), the Participant acknowledges that the ultimate liability for all Tax-Related Items legally due by the Participant is and remains the Participant's responsibility and may exceed the amount actually withheld by the Compnay or the Participant’s employer. Neither the Company nor the Participant's employer: (a) make any representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Award, including the grant of the Award, the vesting or settlement of the Award, the subsequent sale of any Shares acquired pursuant to the Award and the receipt of any dividends or dividend equivalents; or (b) commit to structure the terms of the grant or any aspect of the Award to reduce or eliminate the Participant's liability for Tax-Related Items. Unless prohibited or problematic under applicable law or otherwise may trigger adverse consequences to the Company or the Participant’s employer, the Participant may elect, via the Company's stock plan administrator, to pay any Tax-Related Items required to be withheld in connection with the Award via any of the following methods: (1) withholding a sufficient number of whole Shares from the Actual Shares Awarded to the Participant as a result of the vesting and settlement of the Award (or, in the case of an Award settled in cash, a portion of the sales proceeds) having a fair market value equal to the amount of Tax-Related Items to be withheld ("Share Withholding"); (2) selling a sufficient number of whole Shares from the Actual Shares Awarded to the Participant as a result of the vesting and settlement of the Award having a fair market value equal to the amount of Tax-Related Items to be withheld; or (3) selling all of the Actual Shares Awarded to the Participant as a result of the vesting and settlement of the Award, and withholding from the sale proceeds the amount of Tax-Related Items to be withheld, with the net proceeds disbursed to the Participant. Depending on the withholding method, the Company may withhold for Tax-Related Items by considering applicable statutory withholding amounts or other applicable withholding rates, including maximum applicable rates. To the extent the Participant fails to elect one of the foregoing withholding methods within [30] days of the Date of Award, the Company (or the Participant's employer) shall satisfy any withholding obligation for Tax-Related Items via Share Withholding. Notwithstanding the foregoing, if the Participant is subject to Section 16(b) of the Exchange Act, the Company will withhold using Share Withholding. If the Participant relocates to another jurisdiction, the Participant is responsible for notifying the Company of such relocation and is responsible for compliance with all applicable tax requirements. If the Participant is subject to taxation in more than one jurisdiction, the Participant acknowledges that the Company or the Participant's employer may be required to withhold or account for Tax-Related Items in more than one jurisdiction. By accepting this Award, the Participant expressly consents to the withholding methods as provided for hereunder. All other Tax-Related Items related to the Award and any Shares or cash delivered in settlement thereof are the Participant's sole responsibility. Neither the Company nor any of its Subsidiaries or Affiliates is responsible for any liability or penalty relating to taxes (including excise taxes) on compensation (including imputed compensation) or other income attributed to the Participant (or a Beneficiary) pursuant to this Agreement, whether as a result of the Participant failing to make timely payments of tax or otherwise. |
Change of Control | This Award shall not vest or become immediately payable merely upon the occurrence of a Change of Control. However, the following provisions shall apply if a Change of Control occurs before the Vesting Date: (i) Upon the Change of Control, the number of Actual Shares Awarded shall be fixed at no less than the Target Number of Shares. Such Actual Shares Awarded shall continue to be conditioned on the Participant providing services to the Company or a Subsidiary or Affiliate through the Vesting Date (subject to the provisions of the Plan, this Agreement and the Addendum with respect to death and Disability, and paragraph (iii), below), and shall be paid during the calendar year prescribed by Section 7(b) of the Plan no later than the last day of the “applicable 2½-month period” as defined in Treas. Reg. § 1.409A-1(b)(4)(i)(A). (ii) If as a result of the Change of Control the Company ceases to exist or the Shares are no longer traded on the New York Stock Exchange, the Actual Shares Awarded shall be converted into a cash amount equal to the value of the Actual Shares Awarded, based on the closing price of the Shares on the last day the Shares are traded on the New York Stock Exchange prior to the Change of Control. Such cash amount shall continue to be conditioned on the Participant providing services to the Company or a Subsidiary or Affiliate through the Vesting Date (subject to the provisions of the Plan, this Agreement and the Addendum with respect to death and Disability, and paragraph (iii), below), and shall be paid during the calendar year prescribed by Section 7(b) of the Plan no later than the last day of the “applicable 2½-month period” as defined in Treas. Reg. § 1.409A-1(b)(4)(i)(A). (iii) If prior to the Vesting Date and within 24 months after the Change of Control, the Participant has a Termination of Employment either (1) by the Company (including its successor) or the Participant's employer without Cause or (2) if the Participant has “good reason” rights under the Company's Executive Severance Plan or an employment agreement, by the Participant for “good reason” (as defined in the applicable plan or agreement), then (A) this Award shall become immediately vested and payable to the Participant, and (B) the Payment Date shall occur within 30 days after the Participant's Termination of Employment (subject to the six-month delay rule set forth in Section 11(o)(2) of the Plan). | |
Death or Disability | If the Participant terminates service due to Disability or death, the Participant shall vest in a portion of the Award as determined in accordance with the below if (and only if) Termination of Employment due to death or Disability occurs at least 12 months after the start of the Performance Period: The vested portion of the Award shall be calculated by (i) multiplying the Target Number of Shares to be Awarded Upon Vesting by a fraction (not to exceed 1.0), the numerator of which is the Participant’s number of completed months of service with the Company and its Subsidiaries or Affiliates from the Date of the Award to the Participant’s Termination of Service, and the denominator of which is the number of months from the Date of the Award to the scheduled Vesting Date (such resulting amount, the “Reduced Target Number of Shares to be Awarded Upon Vesting”), and (ii) further adjusting the Reduced Target Number of Shares to be Awarded Upon Vesting up or down based on performance (as described in the following sentence) through the end of the Performance Period. In the case of death, performance will be based on actual performance through the date of death and estimated performance for the remainder of the Performance Period; in the case of Disability, performance will be based on actual performance through the end of the Performance Period. | |
Compliance with Local Laws | Notwithstanding anything to the contrary contained in this Agreement, the Company may, in its sole discretion, settle the Award in the form of: (1) a cash payment to the extent settlement in Shares (a) is prohibited under local law, rules and regulations, (b) would require the Participant, the Company or the Participant's employer to obtain the approval of any governmental and/or regulatory body in the Participant's country of residence (and/or country of employment, if different), or (c) is administratively burdensome; or (2) Shares, but require the Participant to immediately sell such Shares (in which case, this Agreement shall give the Company the authority to issues sales instructions on behalf of the Participant). If the Participant is a resident of or employed in a country other than the United States, the Participant agrees, as a condition of the Award, to repatriate all payments attributable to the Award in accordance with local foreign exchange rules and regulations in the Participant's country of residence (and country of employment, if different). In addition, the Participant agrees to take any and all actions, and consents to any and all actions taken by the Company and the Participant's employer as may be required to allow the Company and the Participant's employer to comply with local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). Finally, the Participant agrees to take any and all actions that may be required to comply with the Participant's personal legal and tax obligations under local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). | |
EU Age Discrimination Rules | If the Participant is resident and/or employed in a country that is a member of the European Union, the grant of the Award and this Agreement are intended to comply with the age discrimination provisions of the EU Equal Treatment Framework Directive, as implemented into local law (the “Age Discrimination Rules”). To the extent that a court or tribunal of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, in whole or in part, under the Age Discrimination Rules, the Company, in its sole discretion, shall have the power and authority to revise or strike such provision to the minimum extent necessary to make it valid and enforceable to the full extent permitted under local law. |
Forfeiture of Award | Before accepting this Award, the Participant must disclose to the Company in writing all grants to the Participant of options, shares and other equity rights with respect to any Subsidiary of the Company ("Subsidiary Grants") that are still outstanding. Failure to disclose in writing the existence of any such outstanding Subsidiary Grants shall result in immediate cancellation and forfeiture of the Award set forth in this Agreement, unless the Administrator determines in its sole discretion that such failure was reasonable under the circumstances. | |
Cancellation and Rescission for Prohibited Activity | Notwithstanding any other provision of the Plan or this Agreement, the Participant acknowledges and agrees that the Company may cancel, rescind, suspend, withhold, modify, amend or otherwise limit or restrict this Award (whether vested or not vested) at any time if the Participant is not in compliance with all applicable provisions of the Agreement and the Plan, or if the Participant engages in any “Prohibited Activity.” For purposes of this Agreement, “Prohibited Activity” means: (i) any activity that would enable the Company (or any Subsidiary or Affiliate where the Participant is employed) to terminate the Participant's employment for cause (as defined in the Plan or any employment agreement or other plan or arrangement that covers the Participant); (ii) a material violation of any rule, policy or procedure of the Company (or any Subsidiary or Affiliate where the Participant is employed), including but not limited to the Code of Conduct of the Company (and any such Subsidiary or Affiliate); (iii) before a Change of Control, a failure to be in compliance with any share ownership objectives of the Company applicable to the Participant, or (iv) before a Change of Control, any other conduct or act that the Company determines is injurious, detrimental or prejudicial to any interest of the Company. The Participant agrees that the cancellation and rescission provisions of this Agreement are reasonable and agrees not to challenge the reasonableness of such provisions, even where forfeiture of this Agreement is the penalty for violation; provided that the Participant may challenge the reasonableness of any forfeiture that occurs after a Change of Control. | |
No Employment Rights | The grant of the Award shall not be interpreted to form an employment contract between the Participant and the Company or the Participant's employer. | |
Discretionary Nature of Award | The Participant acknowledges and agrees that the Plan is discretionary in nature and may be amended, cancelled or terminated by the Company, in its sole discretion, at any time. The grant of the Award under the Plan is a one-time benefit and does not create any contractual or other right to receive a grant of an Award or any other forms of award permitted under the Plan or other benefits in lieu thereof in the future. Future grants, if any, will be at the sole discretion of the Company, including, but not limited to, the form and timing of any grant, the number of Shares granted and the vesting provisions. Any amendment, modification or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Participant's employment with the Participant's employer. | |
Extraordinary Benefit | The Participant's participation in the Plan is voluntary. The value of the Award and any other awards granted under the Plan is an extraordinary item of compensation outside the scope of the Participant's employment (and the Participant's employment contract, if any). Any grant under the Plan, including the grant of the Award, is not part of the Participant's normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, holiday pay, pension, or retirement benefits or similar payments. | |
Value of Benefit | The future value of the Shares subject to this Award is unknown and cannot be predicted with certainty. The Company shall not be liable for any foreign exchange rate fluctuation, where applicable, between the Participant's local currency and the United States dollar that may affect the value of the Award or of any amounts due to the Participant pursuant to the settlement of the Award or the subsequent sale of any Shares acquired upon settlement | |
No Public Offering | The grant of the Award is not intended to be a public offering of securities in the Participant's country of residence (and country of employment, if different). The Company has not submitted any registration statement, prospectus or other filings with the local securities authorities (unless otherwise required under local law). No employee of the Company or its Subsidiaries or Affiliates is permitted to advise the Participant on whether the Participant should acquire Shares under the Plan and provide the Participant with any legal, tax or financial advice with respect to the grant of the Award. The acquisition of Shares involves certain risks, and the Participant should carefully consider all risk factors and tax considerations relevant to the acquisition and disposition of Shares under the Plan. Further, the Participant should carefully review all of the materials related to the Award and the Plan, and the Participant should consult with the Participant's personal legal, tax and financial advisors for professional advice in relation to the Participant's personal circumstances. |
Insider Trading Laws | By participating in the Plan, the Participant expressly agrees to comply with the Company’s insider trading policies and any other of its policies regarding insider trading or personal account dealing applicable to the Participant. Further, the Participant expressly acknowledges and agrees that, depending on the country of residence of the Participant or the Participant’s broker, or where Shares are listed, the Participant may be subject to insider trading restrictions and/or market abuse laws which may affect the Participant's ability to accept, acquire, sell or otherwise dispose of Shares, rights to Shares (e.g., Award) or rights linked to the value of Shares, during such times the Participant is considered to have “inside information” or similar types of information regarding the Company as defined by the laws or regulations in the applicable country. Local insider trading laws and regulations may prohibit the cancellation or amendment of orders the Participant places before the Participant possessed such information. Furthermore, the Participant may be prohibited from (a) disclosing such information to any third party (other than on a “need to know” basis) and (b) “tipping” third parties or causing them otherwise to buy or sell securities (including other employees of the Company or any of its Subsidiaries or Affiliates). Any restrictions under these laws or regulations is separate from and in addition to any restrictions that may be imposed under any applicable Company policies. The Participant expressly acknowledges and agrees that it is the Participant's responsibility to comply with any applicable restrictions, and the Participant should consult the Participant’s personal advisor for additional information on any trading restrictions that may apply to the Participant. | |
Recoupment | Notwithstanding any other provision of this Agreement to the contrary, the Participant acknowledges and agrees that the Award, any Shares acquired pursuant thereto and/or any amount received with respect to any sale of such Shares are subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of any recoupment policy the Company may establish or adopt ("Recoupment Policy") and as the Recoupment Policy may be amended from time to time. The Participant agrees and consents to the Company's application, implementation and enforcement of (a) the Recoupment Policy, and (b) any provision of applicable law relating to cancellation, recoupment, rescission or payback of compensation and expressly agrees that the Company may take such actions as are necessary to effectuate the Recoupment Policy (as applicable to the Participant) or applicable law without further consent or action being required by the Participant. For purposes of the foregoing, the Participant expressly and explicitly authorizes the Company to issue instructions, on the Participant's behalf, to any brokerage firm and/or third party administrator engaged by the Company to hold the Participant's Shares and other amounts acquired under the Plan to re-convey, transfer or otherwise return such Shares and/or other amounts to the Company. To the extent that the terms of this Agreement and the Recoupment Policy conflict, the terms of the Recoupment Policy shall prevail. | |
English Language | If the Participant is resident outside of the United States, the Participant acknowledges and agrees that it is the Participant's express intent that this Agreement, the Plan and all other documents, notices and legal proceedings entered into, given or instituted pursuant to the Award be drawn up in English. If the Participant receives this Agreement, the Plan or any other document related to the Award translated into a language other than English, and if the meaning of the translated version is different than the English version, the English version will control. | |
Electronic Delivery | The Company may, in its sole discretion, decide to deliver any documents related to the Award or other awards granted to the Participant under the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company. |
Data Privacy | The Company is located at 909 Third Avenue, New York, New York 10022, United States of America and grants Awards under the Plan to employees of the Company and its Subsidiaries and Affiliates in its sole discretion. In conjunction with the Company’s grant of the Award under the Plan and its ongoing administration of such awards, the Company is providing the following information about its data collection, processing and transfer practices. In accepting the grant of the Awards, the Participant expressly and explicitly consents to the personal data activities as described herein. (a) Data Collection, Processing and Usage. The Company collects, processes and uses the Participant’s personal data, including the Participant’s name, home address, email address, telephone number, date of birth, social insurance number or other identification number, salary, citizenship, job title, any Shares or directorships held in the Company, and details of all Awards or any other equity compensation awards granted, canceled, exercised, vested, or outstanding in the Participant’s favor, which the Company receives from the Participant or the Participant’s employer. In granting the Awards under the Plan, the Company will collect the Participant’s personal data for purposes of allocating Shares in settlement of the Awards and implementing, administering and managing the Plan. The Company’s legal basis for the collection, processing and usage of the Participant’s personal data is the Participant’s consent. (b) Stock Plan Administration Service Provider. The Company transfers the Participant’s personal data to [UBS Financial Services, an independent service provider based in the United States of America], which assists the Company with the implementation, administration and management of the Plan (the “Stock Plan Administrator”). In the future, the Company may select a different Stock Plan Administrator and share the Participant’s personal data with another company that serves in a similar manner. The Stock Plan Administrator will open an account for the Participant to receive and trade Shares acquired under the Plan. The Participant will be asked to agree on separate terms and data processing practices with the Stock Plan Administrator, which is a condition to the Participant’s ability to participate in the Plan. (c) International Data Transfers. The Company and the Stock Plan Administrator are based in the United States of America. The Participant should note that the Participant’s country of residence may have enacted data privacy laws that are different from the United States of America. The Company’s legal basis for the transfer of the Participant’s personal data to the United States of America is the Participant’s consent. (d) Voluntariness and Consequences of Consent Denial or Withdrawal. The Participant’s participation in the Plan and his or her grant of consent is purely voluntary. The Participant may deny or withdraw his or her consent at any time. If the Participant does not consent, or if the Participant later withdraws his or her consent, the Participant may be unable to participate in the Plan. This would not affect the Participant’s existing employment or salary; instead, the Participant merely may forfeit the opportunities associated with the Plan. (e) Data Subjects Rights. The Participant may have a number of rights under the data privacy laws in the Participant’s country of residence. For example, the Participant’s rights may include the right to (i) request access or copies of personal data the Company processes, (ii) request rectification of incorrect data, (iii) request deletion of data, (iv) place restrictions on processing, (v) lodge complaints with competent authorities in the Participant’s country of residence, and/or (vi) request a list with the names and addresses of any potential recipients of the Participant’s personal data. To receive clarification regarding the Participant’s rights or to exercise his or her rights, the Participant should contact the Participant’s local HR manager. | |
Successors and Assigns | The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Participant and the Participant's beneficiaries, executors or administrators. | |
Addendum | Notwithstanding any provisions of this Agreement to the contrary, the Award shall be subject to any special terms and conditions for the Participant's country of residence (and country of employment, if different) set forth in an addendum to this Agreement (an “Addendum”). Further, if the Participant transfers the Participant's residence and/or employment to another country reflected in an Addendum to this Agreement at the time of transfer, the special terms and conditions for such country will apply to the Participant to the extent the Company determines, in its sole discretion, that the application of such terms and conditions is necessary or advisable in order to comply with local law or to facilitate the operation and administration of the award and the Plan (or the Company may establish alternative terms and conditions as may be necessary or advisable to accommodate the Participant's transfer). In all circumstances, any applicable Addendum shall constitute part of this Agreement. | |
Additional Requirements | The Company reserves the right to impose other requirements on the Award, any Shares acquired pursuant to the Award and the Participant's participation in the Plan to the extent the Company determines, in its sole discretion, that such other requirements are necessary or advisable in order to comply with local law or to facilitate the operation and administration of the Award and the Plan. Such requirements may include (but are not limited to) requiring the Participant to sign any agreements or undertakings that may be necessary to accomplish the foregoing. | |
Severability | The invalidity or unenforceability of any provision of the Plan or this Agreement will not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement will be severable and enforceable to the extent permitted by law. |
Interpretation and Construction | This Agreement and the Plan shall be construed and interpreted by the Administrator, in its sole discretion. Any interpretation or other determination by the Administrator (including, but not limited to, correction of any defect or omission and reconciliation of any inconsistency in the Agreement or the Plan) shall be binding and conclusive. All determinations regarding enforcement, waiver or modification of the cancellation and rescission and other provisions of this Agreement (including the provisions relating to termination of service, death and Disability) shall be made in the Company's sole discretion. Determinations made under this Agreement and the Plan need not be uniform and may be made selectively among individuals, whether or not such individuals are similarly situated. | |
Entire Understanding | This Agreement, the award letter (if any) from the Company, the terms of the Plan and the restrictive covenant agreement attached hereto as Exhibit B constitute the entire understanding between the Participant and the Company and its Subsidiaries and Affiliates regarding this Award. Any prior agreements, commitments, or negotiations concerning this Award are superseded. | |
Participant's Acknowledgement and Agreement | By accepting the grant of the Award, the Participant acknowledges that the Participant has read this Agreement, the Addendum to this Agreement (as applicable), the Plan, and the restrictive covenant agreement and the Participant specifically accepts and agrees to the provisions therein. |
Date of Award | [DATE] | Participant's Name [NAME] | |
Target Number of Shares to be Awarded Upon Vesting | [X] | ||
Performance Period | [X] through [X] | ||
Vesting Date | Subject to the (i) terms of the Plan, (ii) the retirement, forfeiture, cancellation, and rescission provisions of this Agreement and (iii) the Participant's execution of the restrictive covenant agreement that is attached hereto as Exhibit B, the scheduled Vesting Date is as provided in the Participant's award letter, or such later date as specified in the following paragraph. Notwithstanding any other provision of this Agreement, if the audit of the Company's consolidated financial statements for the years included in the Performance Period (the "Audited Financials") has not been completed more than fifteen (15) days before the Vesting Date set forth above, the Vesting Date shall be delayed until the earlier of (i) the thirtieth (30th) day after the completion of the Audited Financials for the years included in the Performance Period or (ii) the date the Actual Shares Awarded (as defined below) are delivered. Except as otherwise provided in the Plan or this Agreement, any portion of this Award that is not vested on the date the Participant ceases to be an employee of the Company and its Subsidiaries and Affiliates shall be forfeited. | ||
Actual Shares Awarded | The "Actual Shares Awarded" (to the extent vested) shall be between 0 and 2 times the "Target Number of Shares to be Awarded Upon Vesting," as determined by the Administrator based on performance against financial metrics (the "Performance Objectives"). Although the Award is intended to be settled in Shares, the Actual Payment Amount may be paid in cash, shares, or a combination as prescribed in Section 7(b) of the Plan. | ||
Payment Date | The Award shall be settled during the calendar year in which the Vesting Date occurs, subject to the following: If the Participant dies before the Vesting Date, within 90 days after the Participant’s death; and If the Participant's employment terminates within 24 months after a Change of Control (and before the Vesting Date), the Award shall be settled at the time prescribed by the Change of Control provisions of this Agreement. |
Achievement of Performance Objectives | Subject to the terms of the Plan, the Administrator shall have sole and exclusive discretion to determine whether and the extent to which the applicable Performance Objectives has been achieved, and the corresponding number of Actual Shares Awarded. Except in the case of death or a Change of Control, the Award shall not vest and no payment shall be made pursuant to this Award unless the Administrator has certified in writing that the Performance Objectives and all other material terms of the Award have been satisfied. | |
Tax Withholding | The Award is subject to withholding for taxes at the time and in the amount determined by the Company or the Participant’s employer. Regardless of any action the Company or the Participant's employer takes with respect to any or all income tax (including U.S. federal, state and local taxes and/or non-U.S. taxes), social insurance, payroll tax, payment on account or other tax-related withholding (“Tax-Related Items”), the Participant acknowledges that the ultimate liability for all Tax-Related Items legally due by the Participant is and remains the Participant's responsibility. Neither the Company nor the Participant's employer: (a) make any representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Award, including the grant of the Award, the vesting or settlement of the Award, the subsequent sale of any Shares acquired pursuant to the Award and the receipt of any dividends or dividend equivalents; or (b) commit to structure the terms of the grant or any aspect of the Award to reduce or eliminate the Participant's liability for Tax-Related Items. Unless prohibited or problematic under applicable law or otherwise may trigger adverse consequences to the Company or the Participant’s employer, the Participant may elect, via the Company's stock plan administrator, to pay any Tax-Related Items required to be withheld in connection with the Award via any of the following methods: (1) withholding a sufficient number of whole Shares from the Actual Shares Awarded to the Participant as a result of the vesting and settlement of the Award (or, in the case of an Award settled in cash, a portion of the sales proceeds) having a fair market value equal to the amount of Tax-Related Items to be withheld ("Share Withholding"); (2) selling a sufficient number of whole Shares from the Actual Shares Awarded to the Participant as a result of the vesting and settlement of the Award having a fair market value equal to the amount of Tax-Related Items to be withheld; or (3) selling all of the Actual Shares Awarded to the Participant as a result of the vesting and settlement of the Award, and withholding from the sale proceeds the amount of Tax-Related Items to be withheld, with the net proceeds disbursed to the Participant. Depending on the withholding method, the Company may withhold for Tax-Related Items by considering applicable statutory withholding amounts or other applicable withholding rates, including maximum applicable rates. To the extent the Participant fails to elect one of the foregoing withholding methods within [30] days of the Date of Award, the Company (or the Participant's employer) shall satisfy any withholding obligation for Tax-Related Items via Share Withholding. Notwithstanding the foregoing, if the Participant is subject to Section 16(b) of the Exchange Act, the Company will withhold using Share Withholding. If the Participant relocates to another jurisdiction, the Participant is responsible for notifying the Company of such relocation and is responsible for compliance with all applicable tax requirements. If the Participant is subject to taxation in more than one jurisdiction, the Participant acknowledges that the Company or the Participant's employer may be required to withhold or account for Tax-Related Items in more than one jurisdiction. By accepting this Award, the Participant expressly consents to the withholding methods as provided for hereunder. All other Tax-Related Items related to the Award and any Shares or cash delivered in settlement thereof are the Participant's sole responsibility. Neither the Company nor any of its Subsidiaries or Affiliates is responsible for any liability or penalty relating to taxes (including excise taxes) on compensation (including imputed compensation) or other income attributed to the Participant (or a Beneficiary) pursuant to this Agreement, whether as a result of the Participant failing to make timely payments of tax or otherwise. |
Change of Control | This Award shall not vest or become immediately payable merely upon the occurrence of a Change of Control. However, the following provisions shall apply if a Change of Control occurs before the Vesting Date: (i) Upon the Change of Control, the number of Actual Shares Awarded shall be fixed at no less than the Target Number of Shares. Such Actual Shares Awarded shall continue to be conditioned on the Participant providing services to the Company or a Subsidiary or Affiliate through the Vesting Date (subject to the provisions of the Plan, this Agreement and the Addendum with respect to Retirement, death and Disability, and paragraph (iii), below), and shall be paid at the time prescribed by this Agreement. (ii) If as a result of the Change of Control the Company ceases to exist or the Shares are no longer traded on the New York Stock Exchange, the Actual Shares Awarded shall be converted into a cash amount equal to the value of the Actual Shares Awarded, based on the closing price of the Shares on the last day the Shares are traded on the New York Stock Exchange prior to the Change of Control. Such cash amount shall continue to be conditioned on the Participant providing services to the Company or a Subsidiary or Affiliate through the Vesting Date (subject to the provisions of the Plan, this Agreement and the Addendum with respect to Retirement, death and Disability, and paragraph (iii), below), and shall be paid at the time prescribed by this Agreement. (iii) If prior to the Vesting Date and within 24 months after the Change of Control, the Participant has a Termination of Employment either (1) by the Company (including its successor) or the Participant's employer without Cause or (2) if the Participant has “good reason” rights under the Company's Executive Severance Plan or an employment agreement, by the Participant for “good reason” (as defined in the applicable plan or agreement), then (A) this Award shall become immediately vested and payable to the Participant, and (B) the Payment Date shall occur within 30 days after the Participant's Termination of Employment (subject to the six-month delay rule set forth in Section 11(o)(2) of the Plan). | |
Retirement | If the Participant terminates service due to Retirement (as defined below) prior to the Vesting Date, the Participant shall vest in a portion of the Award. Such portion shall be calculated by (i) multiplying the Target Number of Shares to be Awarded Upon Vesting by a fraction (not to exceed 1.0), the numerator of which is the Participant’s number of completed months of service with the Company, its Subsidiaries or Affiliates from the Date of the Award to the Participant’s Termination of Service, and the denominator of which is the number of months from the Date of the Award to the scheduled Vesting Date (such resulting amount, the “Reduced Target Number of Shares to be Awarded Upon Vesting”), and (ii) further adjusting the Reduced Target Number of Shares to be Awarded Upon Vesting up or down based on actual performance through the end of the Performance Period. Such vested portion shall be paid on the Payment Date prescribed by this Agreement, and any portion of the Award that is not vested shall be forfeited without consideration. For purposes of this Agreement, “Retirement” means a voluntary Termination of Service with the Company’s approval after the Participant has attained age 55 and ten (10) years of matching contribution service under the Interpublic Group of Companies, Inc. Savings Plan (or, if the Participant is not eligible to participate in the Interpublic Group of Companies, Inc. Savings Plan, vesting service under the Participant’s employer’s 401(k) plan). For purposes of this Agreement, “Termination of Service” means the date the Participant ceases to provide material services to the Company and its Affiliates and Subsidiaries, which includes service as an employee, board member or consultant, as determined by the Company in its sole discretion. | |
Death or Disability | If the Participant terminates service due to Disability or death, the Participant shall vest in a portion of the Award as determined in accordance with the below if (and only if) Termination of Employment due to death or Disability occurs at least 12 months after the start of the Performance Period: The vested portion of the Award shall be calculated by (i) multiplying the Target Number of Shares to be Awarded Upon Vesting by a fraction (not to exceed 1.0), the numerator of which is the Participant’s number of completed months of service with the Company and its Subsidiaries or Affiliates from the Date of the Award to the Participant’s Termination of Service, and the denominator of which is the number of months from the Date of the Award to the scheduled Vesting Date (such resulting amount, the “Reduced Target Number of Shares to be Awarded Upon Vesting”), and (ii) further adjusting the Reduced Target Number of Shares to be Awarded Upon Vesting up or down based on performance (as described in the following sentence) through the end of the Performance Period. In the case of death, performance will be based on actual performance through the date of death and estimated performance for the remainder of the Performance Period; in the case of Disability, performance will be based on actual performance through the end of the Performance Period. |
Compliance with Local Laws | Notwithstanding anything to the contrary contained in this Agreement, the Company may, in its sole discretion, settle the Award in the form of: (1) a cash payment to the extent settlement in Shares (a) is prohibited under local law, rules and regulations, (b) would require the Participant, the Company or the Participant's employer to obtain the approval of any governmental and/or regulatory body in the Participant's country of residence (and/or country of employment, if different), or (c) is administratively burdensome; or (2) Shares, but require the Participant to immediately sell such Shares (in which case, this Agreement shall give the Company the authority to issues sales instructions on behalf of the Participant). If the Participant is a resident of or employed in a country other than the United States, the Participant agrees, as a condition of the Award, to repatriate all payments attributable to the Award in accordance with local foreign exchange rules and regulations in the Participant's country of residence (and country of employment, if different). In addition, the Participant agrees to take any and all actions, and consents to any and all actions taken by the Company and the Participant's employer as may be required to allow the Company and the Participant's employer to comply with local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). Finally, the Participant agrees to take any and all actions that may be required to comply with the Participant's personal legal and tax obligations under local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). | |
EU Age Discrimination Rules | If the Participant is resident and/or employed in a country that is a member of the European Union, the grant of the Award and this Agreement are intended to comply with the age discrimination provisions of the EU Equal Treatment Framework Directive, as implemented into local law (the “Age Discrimination Rules”). To the extent that a court or tribunal of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, in whole or in part, under the Age Discrimination Rules, the Company, in its sole discretion, shall have the power and authority to revise or strike such provision to the minimum extent necessary to make it valid and enforceable to the full extent permitted under local law. | |
Forfeiture of Award | Before accepting this Award, the Participant must disclose to the Company in writing all grants to the Participant of options, shares and other equity rights with respect to any Subsidiary of the Company ("Subsidiary Grants") that are still outstanding. Failure to disclose in writing the existence of any such outstanding Subsidiary Grants shall result in immediate cancellation and forfeiture of the Award set forth in this Agreement, unless the Administrator determines in its sole discretion that such failure was reasonable under the circumstances. | |
Cancellation and Rescission for Prohibited Activity | Notwithstanding any other provision of the Plan or this Agreement, the Participant acknowledges and agrees that the Company may cancel, rescind, suspend, withhold, modify, amend or otherwise limit or restrict this Award (whether vested or not vested) at any time if the Participant is not in compliance with all applicable provisions of the Agreement and the Plan, or if the Participant engages in any “Prohibited Activity.” For purposes of this Agreement, “Prohibited Activity” means: (i) any activity that would enable the Company (or any Subsidiary or Affiliate where the Participant is employed) to terminate the Participant's employment for cause (as defined in the Plan or any employment agreement or other plan or arrangement that covers the Participant); (ii) a material violation of any rule, policy or procedure of the Company (or any Subsidiary or Affiliate where the Participant is employed), including but not limited to the Code of Conduct of the Company (and any such Subsidiary or Affiliate); (iii) before a Change of Control, a failure to be in compliance with any share ownership objectives of the Company applicable to the Participant, or (iv) before a Change of Control, any other conduct or act that the Company determines is injurious, detrimental or prejudicial to any interest of the Company. The Participant agrees that the cancellation and rescission provisions of this Agreement are reasonable and agrees not to challenge the reasonableness of such provisions, even where forfeiture of this Agreement is the penalty for violation; provided that the Participant may challenge the reasonableness of any forfeiture that occurs after a Change of Control. | |
No Employment Rights | The grant of the Award shall not be interpreted to form an employment contract between the Participant and the Company or the Participant's employer. | |
Discretionary Nature of Award | The Participant acknowledges and agrees that the Plan is discretionary in nature and may be amended, cancelled or terminated by the Company, in its sole discretion, at any time. The grant of the Award under the Plan is a one-time benefit and does not create any contractual or other right to receive a grant of an Award or any other forms of award permitted under the Plan or other benefits in lieu thereof in the future. Future grants, if any, will be at the sole discretion of the Company, including, but not limited to, the form and timing of any grant, the number of Shares granted and the vesting provisions. Any amendment, modification or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Participant's employment with the Participant's employer. | |
Extraordinary Benefit | The Participant's participation in the Plan is voluntary. The value of the Award and any other awards granted under the Plan is an extraordinary item of compensation outside the scope of the Participant's employment (and the Participant's employment contract, if any). Any grant under the Plan, including the grant of the Award, is not part of the Participant's normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, holiday pay, pension, or retirement benefits or similar payments. |
Value of Benefit | The future value of the Shares subject to this Award is unknown and cannot be predicted with certainty. The Company shall not be liable for any foreign exchange rate fluctuation, where applicable, between the Participant's local currency and the United States dollar that may affect the value of the Award or of any amounts due to the Participant pursuant to the settlement of the Award or the subsequent sale of any Shares acquired upon settlement | |
No Public Offering | The grant of the Award is not intended to be a public offering of securities in the Participant's country of residence (and country of employment, if different). The Company has not submitted any registration statement, prospectus or other filings with the local securities authorities (unless otherwise required under local law). No employee of the Company or its Subsidiaries or Affiliates is permitted to advise the Participant on whether the Participant should acquire Shares under the Plan and provide the Participant with any legal, tax or financial advice with respect to the grant of the Award. The acquisition of Shares involves certain risks, and the Participant should carefully consider all risk factors and tax considerations relevant to the acquisition and disposition of Shares under the Plan. Further, the Participant should carefully review all of the materials related to the Award and the Plan, and the Participant should consult with the Participant's personal legal, tax and financial advisors for professional advice in relation to the Participant's personal circumstances. | |
Insider Trading Laws | By participating in the Plan, the Participant expressly agrees to comply with the Company’s insider trading policies and any other of its policies regarding insider trading or personal account dealing applicable to the Participant. Further, the Participant expressly acknowledges and agrees that, depending on the country of residence of the Participant or the Participant’s broker, or where Shares are listed, the Participant may be subject to insider trading restrictions and/or market abuse laws which may affect the Participant's ability to accept, acquire, sell or otherwise dispose of Shares, rights to Shares (e.g., Award) or rights linked to the value of Shares, during such times the Participant is considered to have “inside information” or similar types of information regarding the Company as defined by the laws or regulations in the applicable country. Local insider trading laws and regulations may prohibit the cancellation or amendment of orders the Participant places before the Participant possessed such information. Furthermore, the Participant may be prohibited from (a) disclosing such information to any third party (other than on a “need to know” basis) and (b) “tipping” third parties or causing them otherwise to buy or sell securities (including other employees of the Company or any of its Subsidiaries or Affiliates). Any restriction under these laws or regulations is separate from and in addition to any restrictions that may be imposed under any applicable Company policies. The Participant expressly acknowledges and agrees that it is the Participant's responsibility to comply with any applicable restrictions, and the Participant should consult the Participant’s personal advisor for additional information on any trading restrictions that may apply to the Participant. | |
Recoupment | Notwithstanding any other provision of this Agreement to the contrary, the Participant acknowledges and agrees that the Award, any Shares acquired pursuant thereto and/or any amount received with respect to any sale of such Shares are subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of any recoupment policy the Company may establish or adopt ("Recoupment Policy") and as the Recoupment Policy may be amended from time to time. The Participant agrees and consents to the Company's application, implementation and enforcement of (a) the Recoupment Policy, and (b) any provision of applicable law relating to cancellation, recoupment, rescission or payback of compensation and expressly agrees that the Company may take such actions as are necessary to effectuate the Recoupment Policy (as applicable to the Participant) or applicable law without further consent or action being required by the Participant. For purposes of the foregoing, the Participant expressly and explicitly authorizes the Company to issue instructions, on the Participant's behalf, to any brokerage firm and/or third party administrator engaged by the Company to hold the Participant's Shares and other amounts acquired under the Plan to re-convey, transfer or otherwise return such Shares and/or other amounts to the Company. To the extent that the terms of this Agreement and the Recoupment Policy conflict, the terms of the Recoupment Policy shall prevail. | |
English Language | If the Participant is resident outside of the United States, the Participant acknowledges and agrees that it is the Participant's express intent that this Agreement, the Plan and all other documents, notices and legal proceedings entered into, given or instituted pursuant to the Award be drawn up in English. If the Participant receives this Agreement, the Plan or any other document related to the Award translated into a language other than English, and if the meaning of the translated version is different than the English version, the English version will control. | |
Electronic Delivery | The Company may, in its sole discretion, decide to deliver any documents related to the Award or other awards granted to the Participant under the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company. |
Data Privacy | The Company is located at 909 Third Avenue, New York, New York 10022, United States of America and grants Awards under the Plan to employees of the Company and its Subsidiaries and Affiliates in its sole discretion. In conjunction with the Company’s grant of the Award under the Plan and its ongoing administration of such awards, the Company is providing the following information about its data collection, processing and transfer practices. In accepting the grant of the Awards, the Participant expressly and explicitly consents to the personal data activities as described herein. (a) Data Collection, Processing and Usage. The Company collects, processes and uses the Participant’s personal data, including the Participant’s name, home address, email address, telephone number, date of birth, social insurance number or other identification number, salary, citizenship, job title, any Shares or directorships held in the Company, and details of all Awards or any other equity compensation awards granted, canceled, exercised, vested, or outstanding in the Participant’s favor, which the Company receives from the Participant or the Participant’s employer. In granting the Awards under the Plan, the Company will collect the Participant’s personal data for purposes of allocating Shares in settlement of the Awards and implementing, administering and managing the Plan. The Company’s legal basis for the collection, processing and usage of the Participant’s personal data is the Participant’s consent. (b) Stock Plan Administration Service Provider. The Company transfers the Participant’s personal data to [UBS Financial Services, an independent service provider based in the United States of America], which assists the Company with the implementation, administration and management of the Plan (the “Stock Plan Administrator”). In the future, the Company may select a different Stock Plan Administrator and share the Participant’s personal data with another company that serves in a similar manner. The Stock Plan Administrator will open an account for the Participant to receive and trade Shares acquired under the Plan. The Participant will be asked to agree on separate terms and data processing practices with the Stock Plan Administrator, which is a condition to the Participant’s ability to participate in the Plan. (c) International Data Transfers. The Company and the Stock Plan Administrator are based in the United States of America. The Participant should note that the Participant’s country of residence may have enacted data privacy laws that are different from the United States of America. The Company’s legal basis for the transfer of the Participant’s personal data to the United States of America is the Participant’s consent. (d) Voluntariness and Consequences of Consent Denial or Withdrawal. The Participant’s participation in the Plan and his or her grant of consent is purely voluntary. The Participant may deny or withdraw his or her consent at any time. If the Participant does not consent, or if the Participant later withdraws his or her consent, the Participant may be unable to participate in the Plan. This would not affect the Participant’s existing employment or salary; instead, the Participant merely may forfeit the opportunities associated with the Plan. (e) Data Subjects Rights. The Participant may have a number of rights under the data privacy laws in the Participant’s country of residence. For example, the Participant’s rights may include the right to (i) request access or copies of personal data the Company processes, (ii) request rectification of incorrect data, (iii) request deletion of data, (iv) place restrictions on processing, (v) lodge complaints with competent authorities in the Participant’s country of residence, and/or (vi) request a list with the names and addresses of any potential recipients of the Participant’s personal data. To receive clarification regarding the Participant’s rights or to exercise his or her rights, the Participant should contact the Participant’s local HR manager. | |
Successors and Assigns | The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Participant and the Participant's beneficiaries, executors or administrators. | |
Addendum | Notwithstanding any provisions of this Agreement to the contrary, the Award shall be subject to any special terms and conditions for the Participant's country of residence (and country of employment, if different) set forth in an addendum to this Agreement (an “Addendum”). Further, if the Participant transfers the Participant's residence and/or employment to another country reflected in an Addendum to this Agreement at the time of transfer, the special terms and conditions for such country will apply to the Participant to the extent the Company determines, in its sole discretion, that the application of such terms and conditions is necessary or advisable in order to comply with local law or to facilitate the operation and administration of the award and the Plan (or the Company may establish alternative terms and conditions as may be necessary or advisable to accommodate the Participant's transfer). In all circumstances, any applicable Addendum shall constitute part of this Agreement. | |
Additional Requirements | The Company reserves the right to impose other requirements on the Award, any Shares acquired pursuant to the Award and the Participant's participation in the Plan to the extent the Company determines, in its sole discretion, that such other requirements are necessary or advisable in order to comply with local law or to facilitate the operation and administration of the Award and the Plan. Such requirements may include (but are not limited to) requiring the Participant to sign any agreements or undertakings that may be necessary to accomplish the foregoing. |
Severability | The invalidity or unenforceability of any provision of the Plan or this Agreement will not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement will be severable and enforceable to the extent permitted by law. | |
Interpretation and Construction | This Agreement and the Plan shall be construed and interpreted by the Administrator, in its sole discretion. Any interpretation or other determination by the Administrator (including, but not limited to, correction of any defect or omission and reconciliation of any inconsistency in the Agreement or the Plan) shall be binding and conclusive. All determinations regarding enforcement, waiver or modification of the cancellation and rescission and other provisions of this Agreement (including the provisions relating to termination of service, death and Disability) shall be made in the Company's sole discretion. Determinations made under this Agreement and the Plan need not be uniform and may be made selectively among individuals, whether or not such individuals are similarly situated. | |
Entire Understanding | This Agreement, the award letter (if any) from the Company, the terms of the Plan and the restrictive covenant agreement attached hereto as Exhibit B constitute the entire understanding between the Participant and the Company and its Subsidiaries and Affiliates regarding this Award. Any prior agreements, commitments, or negotiations concerning this Award are superseded. | |
Participant's Acknowledgement and Agreement | By accepting the grant of the Award, the Participant acknowledges that the Participant has read this Agreement, the Addendum to this Agreement (as applicable), the Plan, and the restrictive covenant agreement and the Participant specifically accepts and agrees to the provisions therein. |
Date of Award | [DATE] | Participant's Name [NAME] | |
Target Amount to be Paid Upon Vesting [X] | |||
Performance Period | [X] through [X] | ||
Vesting Date | Subject to the (i) terms of the Plan, (ii) the forfeiture, cancellation, and rescission provisions of this Agreement and (iii) the Participant's execution of the restrictive covenant agreement that is attached hereto as Exhibit B, the scheduled Vesting Date is as provided in the Participant's award letter, or such later date as specified in the following paragraph. Notwithstanding any other provision of this Agreement, if the audit of the Company's consolidated financial statements for the years included in the Performance Period (the "Audited Financials") has not been completed more than fifteen (15) days before the Vesting Date set forth above, the Vesting Date shall be delayed until the earlier of (i) the thirtieth (30th) day after the completion of the Audited Financials for the years included in the Performance Period or (ii) the date the Actual Payment Amount (as defined below) is paid. Except as otherwise provided in the Plan or this Agreement, any portion of this Performance Cash Award that is not vested on the date the Participant ceases to be an employee of the Company and its Subsidiaries and Affiliates shall be forfeited. | ||
Actual Payment Amount | The "Actual Payment Amount" (to the extent vested) shall be between 0 and 3 times the "Target Amount to be Paid Upon Vesting," as determined by the Administrator based on performance against financial metrics (the "Performance Objectives"). | ||
Payment Date | The Award shall be paid during the calendar year prescribed by Section 8(b) of the Plan no later than the last day of the "applicable 2 ½ month period" as defined in Treas. Reg. Section 1.409A-1(b)(4)(i)(A), subject to the following: If the Participant dies before the Vesting Date, within 90 days after the Participant’s death; and If the Participant's employment terminates within 24 months after a Change of Control (and before the Vesting Date), the Award shall be paid at the time prescribed by the Change of Control provisions of this Agreement. |
Achievement of Performance Objectives | Subject to the terms of the Plan, the Administrator shall have sole and exclusive discretion to determine whether and the extent to which the applicable Performance Objectives has been achieved, and the corresponding amount that is payable pursuant to this Performance Cash Award. Except in the case of death or a Change of Control, the Performance Cash Award shall not vest and no payment shall be made pursuant to this Performance Cash Award unless the Administrator has certified in writing that the Performance Objectives and all other material terms of the Performance Cash Award have been satisfied. | ||
Tax Withholding | The Award is subject to withholding for taxes at the time and in the amount determined by the Company or the Participant’s employer. Regardless of any action the Company or the Participant's employer takes with respect to any or all income tax (including U.S. federal, state and local taxes and/or non-U.S. taxes), social insurance, payroll tax, payment on account or other tax-related withholding (“Tax-Related Items”), the Participant acknowledges that the ultimate liability for all Tax-Related Items legally due by the Participant is and remains the Participant's responsibility. Neither the Company nor the Participant's employer: (a) make any representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Performance Cash Award, including the grant of the Performance Cash Award, and the vesting or settlement of the Performance Cash Award; or (b) commit to structure the terms of the grant or any aspect of the Performance Cash Award to reduce or eliminate the Participant's liability for Tax-Related Items. If the Participant's country of residence (and/or country of employment, if different) requires withholding of Tax-Related Items, the Company may withhold a sufficient portion of the Actual Payment Amount equal to the amount of Tax-Related Items required to be withheld. If the Participant relocates to another jurisdiction, the Participant is responsible for notifying the Company of such relocation and is responsible for compliance with all applicable tax requirements. If the Participant is subject to taxation in more than one jurisdiction, the Participant acknowledges that the Company or the Participant's employer may be required to withhold or account for Tax-Related Items in more than one jurisdiction. By accepting this Performance Cash Award, the Participant expressly consents to the withholding methods as provided for hereunder. All other Tax-Related Items related to the Performance Cash Award and amounts delivered in settlement thereof are the Participant’s sole responsibility. Neither the Company nor any of its Subsidiaries or Affiliates is responsible for any liability or penalty relating to taxes (including excise taxes) on compensation (including imputed compensation) or other income attributed to the Participant (or a Beneficiary) pursuant to this Agreement, whether as a result of the Participant failing to make timely payments of tax or otherwise. | ||
Change of Control | This Performance Cash Award shall not vest or become immediately payable merely upon the occurrence of a Change of Control. However, the following provisions shall apply if a Change of Control occurs before the Vesting Date: (i) Upon the Change of Control, the Actual Payment Amount shall be fixed at no less than the Target Amount to be Paid Upon Vesting. Such Actual Payment Amount shall continue to be conditioned on the Participant providing services to the Company or a Subsidiary or Affiliate through the Vesting Date (subject to the provisions of the Plan, this Agreement and the Addendum with respect to death and Disability, and paragraph (ii), below), and shall be paid during the calendar year prescribed by Section 8(b) of the Plan no later than the last day of the “applicable 2½-month period” as defined in Treas. Reg. § 1.409A-1(b)(4)(i)(A). (ii) If prior to the Vesting Date and within 24 months after the Change of Control, the Participant has a Termination of Employment either (1) by the Company (including its successor) or the Participant's employer without Cause or (2) if the Participant has “good reason” rights under the Company’s Executive Severance Plan or an employment agreement, by the Participant for “good reason” (as defined in the applicable plan or agreement), then (A) this Award shall become immediately vested and payable to the Participant, and (B) the Payment Date shall occur within 30 days after the Participant's Termination of Employment (subject to the six-month delay rule set forth in Section 11(o)(2) of the Plan). | ||
Death or Disability | If the Participant terminates service due to Disability or death, the Participant shall vest in a portion of the Award as determined in accordance with the below if (and only if) Termination of Employment due to death or Disability occurs at least 12 months after the start of the Performance Period: The vested portion of the Award shall be calculated by (i) multiplying the Target Amount to be Paid Upon Vesting by a fraction (not to exceed 1.0), the numerator of which is the Participant’s number of completed months of service with the Company and its Subsidiaries or Affiliates from the Date of the Award to the Participant’s Termination of Service, and the denominator of which is the number of months from the Date of the Award to the scheduled Vesting Date (such resulting amount, the “Reduced Target Amount to be Paid Upon Vesting”), and (ii) further adjusting the Reduced Target Amount to be Paid Upon Vesting up or down based on performance (as described in the following sentence) through the end of the Performance Period. In the case of death, performance will be based on actual performance through the date of death and estimated performance for the remainder of the Performance Period; in the case of Disability, performance will be based on actual performance through the end of the Performance Period. |
Compliance with Local Laws | If the Participant is a resident of or employed in a country other than the United States, the Participant agrees, as a condition of the Performance Cash Award, to repatriate all payments attributable to the Performance Cash Award in accordance with local foreign exchange rules and regulations in the Participant's country of residence (and country of employment, if different). In addition, the Participant agrees to take any and all actions, and consents to any and all actions taken by the Company and the Participant's employer as may be required to allow the Company and the Participant's employer to comply with local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). Finally, the Participant agrees to take any and all actions that may be required to comply with the Participant's personal legal and tax obligations under local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). | ||
EU Age Discrimination Rules | If the Participant is resident and/or employed in a country that is a member of the European Union, the grant of the Performance Cash Award and this Agreement are intended to comply with the age discrimination provisions of the EU Equal Treatment Framework Directive, as implemented into local law (the “Age Discrimination Rules”). To the extent that a court or tribunal of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, in whole or in part, under the Age Discrimination Rules, the Company, in its sole discretion, shall have the power and authority to revise or strike such provision to the minimum extent necessary to make it valid and enforceable to the full extent permitted under local law. | ||
Forfeiture of Award | Before accepting this Performance Cash Award, the Participant must disclose to the Company in writing all grants to the Participant of options, shares and other equity rights with respect to any Subsidiary of the Company ("Subsidiary Grants") that are still outstanding. Failure to disclose in writing the existence of any such outstanding Subsidiary Grants shall result in immediate cancellation and forfeiture of the Performance Cash Award set forth in this Agreement, unless the Administrator determines in its sole discretion that such failure was reasonable under the circumstances. | ||
Cancellation and Rescission for Prohibited Activity | Notwithstanding any other provision of the Plan or this Agreement, the Participant acknowledges and agrees that the Company may cancel, rescind, suspend, withhold, modify, amend or otherwise limit or restrict this Performance Cash Award (whether vested or not vested) at any time if the Participant is not in compliance with all applicable provisions of the Agreement and the Plan, or if the Participant engages in any “Prohibited Activity.” For purposes of this Agreement, “Prohibited Activity” means: (i) any activity that would enable the Company (or any Subsidiary or Affiliate where the Participant is employed) to terminate the Participant's employment for cause (as defined in the Plan or any employment agreement or other plan or arrangement that covers the Participant); (ii) a material violation of any rule, policy or procedure of the Company (or any Subsidiary or Affiliate where the Participant is employed), including but not limited to the Code of Conduct of the Company (and any such Subsidiary or Affiliate); (iii) before a Change of Control, a failure to be in compliance with any share ownership objectives of the Company applicable to the Participant, or (iv) before a Change of Control, any other conduct or act that the Company determines is injurious, detrimental or prejudicial to any interest of the Company. The Participant agrees that the cancellation and rescission provisions of this Agreement are reasonable and agrees not to challenge the reasonableness of such provisions, even where forfeiture of this Agreement is the penalty for violation; provided that the Participant may challenge the reasonableness of any forfeiture that occurs after a Change of Control. | ||
No Employment Rights | The grant of the Performance Cash Award shall not be interpreted to form an employment contract between the Participant and the Company or the Participant's employer. | ||
Discretionary Nature of Award | The Participant acknowledges and agrees that the Plan is discretionary in nature and may be amended, cancelled or terminated by the Company, in its sole discretion, at any time. The grant of the Performance Cash Award under the Plan is a one-time benefit and does not create any contractual or other right to receive a grant of a Performance Cash Award or any other forms of award permitted under the Plan or other benefits in lieu thereof in the future. Future grants, if any, will be at the sole discretion of the Company, including, but not limited to, the form and timing of any grant, the amount of the cash payment granted and the vesting provisions. Any amendment, modification or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Participant's employment with the Participant's employer. | ||
Extraordinary Benefit | The Participant's participation in the Plan is voluntary. The value of the Performance Cash Award and any other awards granted under the Plan is an extraordinary item of compensation outside the scope of the Participant's employment (and the Participant's employment contract, if any). Any grant under the Plan, including the grant of the Performance Cash Award, is not part of the Participant's normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, holiday pay, pension, or retirement benefits or similar payments. | ||
Value of Benefit | The future value of the Actual Payment Amount subject to the Performance Cash Award is unknown and cannot be predicted with certainty. The Company shall not be liable for any foreign exchange rate fluctuation, where applicable, between the Participant's local currency and the United States dollar that may affect the value of the Performance Cash Award or of any amounts due to the Participant pursuant to the settlement of the Performance Cash Award. |
No Public Offering | The grant of the Performance Cash Award is not intended to be a public offering of securities in the Participant's country of residence (and country of employment, if different). The Company has not submitted any registration statement, prospectus or other filings with the local securities authorities (unless otherwise required under local law). No employee of the Company or its Subsidiaries or Affiliates is permitted to provide the Participant with any legal, tax or financial advice with respect to the grant of the Performance Cash Award. The Participant should carefully review all of the materials related to the Performance Cash Award and the Plan, and the Participant should consult with the Participant's personal legal, tax and financial advisors for professional advice in relation to the Participant's personal circumstances. | ||
Recoupment | Notwithstanding any other provision of this Agreement to the contrary, the Participant acknowledges and agrees that the Performance Cash Award, or any amount received with respect thereto are subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of any recoupment policy the Company may establish or adopt ("Recoupment Policy") and as the Recoupment Policy may be amended from time to time. The Participant agrees and consents to the Company's application, implementation and enforcement of (a) the Recoupment Policy, and (b) any provision of applicable law relating to cancellation, recoupment, rescission or payback of compensation and expressly agrees that the Company may take such actions as are necessary to effectuate the Recoupment Policy (as applicable to the Participant) or applicable law without further consent or action being required by the Participant. For purposes of the foregoing, the Participant expressly and explicitly authorizes the Company to issue instructions, on the Participant's behalf, to any brokerage firm and/or third party administrator engaged by the Company to hold any amounts acquired under the Plan to re-convey, transfer or otherwise return such amounts to the Company. To the extent that the terms of this Agreement and the Recoupment Policy conflict, the terms of the Recoupment Policy shall prevail. | ||
English Language | If the Participant is resident outside of the United States, the Participant acknowledges and agrees that it is the Participant's express intent that this Agreement, the Plan and all other documents, notices and legal proceedings entered into, given or instituted pursuant to the Performance Cash Award be drawn up in English. If the Participant receives this Agreement, the Plan or any other document related to the Performance Cash Award translated into a language other than English, and if the meaning of the translated version is different than the English version, the English version will control. | ||
Electronic Delivery | The Company may, in its sole discretion, decide to deliver any documents related to the Performance Cash Award or other awards granted to the Participant under the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company. |
Data Privacy | The Company is located at 909 Third Avenue, New York, New York 10022, United States of America and grants Performance Cash Awards under the Plan to employees of the Company and its Subsidiaries and Affiliates in its sole discretion. In conjunction with the Company’s grant of the Performance Cash Award under the Plan and its ongoing administration of such awards, the Company is providing the following information about its data collection, processing and transfer practices. In accepting the grant of the Performance Cash Awards, the Participant expressly and explicitly consents to the personal data activities as described herein. (a) Data Collection, Processing and Usage. The Company collects, processes and uses the Participant’s personal data, including the Participant’s name, home address, email address, telephone number, date of birth, social insurance number or other identification number, salary, citizenship, job title, any Shares or directorships held in the Company, and details of all Performance Cash Awards or any other equity compensation awards granted, canceled, exercised, vested, or outstanding in the Participant’s favor, which the Company receives from the Participant or the Participant’s employer. In granting the Performance Cash Awards under the Plan, the Company will collect the Participant’s personal data for purposes of allocating Shares in settlement of the Performance Cash Awards and implementing, administering and managing the Plan. The Company’s legal basis for the collection, processing and usage of the Participant’s personal data is the Participant’s consent. (b) Stock Plan Administration Service Provider. The Company transfers the Participant’s personal data to [UBS Financial Services, an independent service provider based in the United States of America], which assists the Company with the implementation, administration and management of the Plan (the “Stock Plan Administrator”). In the future, the Company may select a different Stock Plan Administrator and share the Participant’s personal data with another company that serves in a similar manner. The Stock Plan Administrator will open an account for the Participant to receive and trade Shares acquired under the Plan. The Participant will be asked to agree on separate terms and data processing practices with the Stock Plan Administrator, which is a condition to the Participant’s ability to participate in the Plan. (c) International Data Transfers. The Company and the Stock Plan Administrator are based in the United States of America. The Participant should note that the Participant’s country of residence may have enacted data privacy laws that are different from the United States of America. The Company’s legal basis for the transfer of the Participant’s personal data to the United States of America is the Participant’s consent. (d) Voluntariness and Consequences of Consent Denial or Withdrawal. The Participant’s participation in the Plan and his or her grant of consent is purely voluntary. The Participant may deny or withdraw his or her consent at any time. If the Participant does not consent, or if the Participant later withdraws his or her consent, the Participant may be unable to participate in the Plan. This would not affect the Participant’s existing employment or salary; instead, the Participant merely may forfeit the opportunities associated with the Plan. (e) Data Subjects Rights. The Participant may have a number of rights under the data privacy laws in the Participant’s country of residence. For example, the Participant’s rights may include the right to (i) request access or copies of personal data the Company processes, (ii) request rectification of incorrect data, (iii) request deletion of data, (iv) place restrictions on processing, (v) lodge complaints with competent authorities in the Participant’s country of residence, and/or (vi) request a list with the names and addresses of any potential recipients of the Participant’s personal data. To receive clarification regarding the Participant’s rights or to exercise his or her rights, the Participant should contact the Participant’s local HR manager. | ||
Successors and Assigns | The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Participant and the Participant's beneficiaries, executors or administrators. | ||
Addendum | Notwithstanding any provisions of this Agreement to the contrary, the Performance Cash Award shall be subject to any special terms and conditions for the Participant's country of residence (and country of employment, if different) set forth in an addendum to this Agreement (an “Addendum”). Further, if the Participant transfers the Participant's residence and/or employment to another country reflected in an Addendum to this Agreement at the time of transfer, the special terms and conditions for such country will apply to the Participant to the extent the Company determines, in its sole discretion, that the application of such terms and conditions is necessary or advisable in order to comply with local law or to facilitate the operation and administration of the award and the Plan (or the Company may establish alternative terms and conditions as may be necessary or advisable to accommodate the Participant's transfer). In all circumstances, any applicable Addendum shall constitute part of this Agreement. | ||
Additional Requirements | The Company reserves the right to impose other requirements on the Performance Cash Award and the Participant's participation in the Plan to the extent the Company determines, in its sole discretion, that such other requirements are necessary or advisable in order to comply with local law or to facilitate the operation and administration of the Performance Cash Award and the Plan. Such requirements may include (but are not limited to) requiring the Participant to sign any agreements or undertakings that may be necessary to accomplish the foregoing. |
Severability | The invalidity or unenforceability of any provision of the Plan or this Agreement will not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement will be severable and enforceable to the extent permitted by law. | ||
Interpretation and Construction | This Agreement and the Plan shall be construed and interpreted by the Administrator, in its sole discretion. Any interpretation or other determination by the Administrator (including, but not limited to, correction of any defect or omission and reconciliation of any inconsistency in the Agreement or the Plan) shall be binding and conclusive. All determinations regarding enforcement, waiver or modification of the cancellation and rescission and other provisions of this Agreement (including the provisions relating to termination of service, death and Disability) shall be made in the Company's sole discretion. Determinations made under this Agreement and the Plan need not be uniform and may be made selectively among individuals, whether or not such individuals are similarly situated. | ||
Entire Understanding | This Agreement, the award letter (if any) from the Company, the terms of the Plan and the restrictive covenant agreement attached hereto as Exhibit B constitute the entire understanding between the Participant and the Company and its Subsidiaries and Affiliates regarding this Performance Cash Award. Any prior agreements, commitments, or negotiations concerning this Performance Cash Award are superseded. | ||
Participant's Acknowledgement and Agreement | By accepting the grant of the Performance Cash Award, the Participant acknowledges that the Participant has read this Agreement, the Addendum to this Agreement (as applicable), the Plan, and the restrictive covenant agreement and the Participant specifically accepts and agrees to the provisions therein. |
Date of Award | [DATE] | Participant's Name [NAME] | ||
Target Amount to be Paid Upon Vesting [X] | ||||
Performance Period | [X] through [X] | |||
Vesting Date | Subject to the (i) terms of the Plan, (ii) the retirement, forfeiture, cancellation, and rescission provisions of this Agreement and (iii) the Participant's execution of the restrictive covenant agreement that is attached hereto as Exhibit B, the scheduled Vesting Date is as provided in the Participant's award letter, or such later date as specified in the following paragraph. Notwithstanding any other provision of this Agreement, if the audit of the Company's consolidated financial statements for the years included in the Performance Period (the "Audited Financials") has not been completed more than fifteen (15) days before the Vesting Date set forth above, the Vesting Date shall be delayed until the earlier of (i) the thirtieth (30th) day after the completion of the Audited Financials for the years included in the Performance Period or (ii) the date the Actual Payment Amount (as defined below) is paid. Except as otherwise provided in the Plan or this Agreement, any portion of this Performance Cash Award that is not vested on the date the Participant ceases to be an employee of the Company and its Subsidiaries and Affiliates shall be forfeited. | |||
Actual Payment Amount | The "Actual Payment Amount" (to the extent vested) shall be between 0 and 2 times the "Target Amount to be Paid Upon Vesting," as determined by the Administrator based on performance against financial metrics (the "Performance Objectives"). | |||
Payment Date | The Award shall be paid during the calendar year in which the Vesting Date occurs, subject to the following: If the Participant dies before the Vesting Date, within 90 days after the Participant’s death; and If the Participant's employment terminates within 24 months after a Change of Control (and before the Vesting Date), the Award shall be paid at the time prescribed by the Change of Control provisions of this Agreement. |
Achievement of Performance Objectives | Subject to the terms of the Plan, the Administrator shall have sole and exclusive discretion to determine whether and the extent to which the applicable Performance Objectives has been achieved, and the corresponding amount that is payable pursuant to this Performance Cash Award. Except in the case of death or a Change of Control, the Performance Cash Award shall not vest and no payment shall be made pursuant to this Performance Cash Award unless the Administrator has certified in writing that the Performance Objectives and all other material terms of the Performance Cash Award have been satisfied. | |
Tax Withholding | The Award is subject to withholding for taxes at the time and in the amount determined by the Company or the Participant’s employer. Regardless of any action the Company or the Participant's employer takes with respect to any or all income tax (including U.S. federal, state and local taxes and/or non-U.S. taxes), social insurance, payroll tax, payment on account or other tax-related withholding (“Tax-Related Items”), the Participant acknowledges that the ultimate liability for all Tax-Related Items legally due by the Participant is and remains the Participant's responsibility. Neither the Company nor the Participant's employer: (a) make any representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Performance Cash Award, including the grant of the Performance Cash Award, and the vesting or settlement of the Performance Cash Award; or (b) commit to structure the terms of the grant or any aspect of the Performance Cash Award to reduce or eliminate the Participant's liability for Tax-Related Items. If the Participant's country of residence (and/or country of employment, if different) requires withholding of Tax-Related Items, the Company may withhold a sufficient portion of the Actual Payment Amount equal to the amount of Tax-Related Items required to be withheld. If the Participant relocates to another jurisdiction, the Participant is responsible for notifying the Company of such relocation and is responsible for compliance with all applicable tax requirements. If the Participant is subject to taxation in more than one jurisdiction, the Participant acknowledges that the Company or the Participant's employer may be required to withhold or account for Tax-Related Items in more than one jurisdiction. By accepting this Performance Cash Award, the Participant expressly consents to the withholding methods as provided for hereunder. All other Tax-Related Items related to the Performance Cash Award and amounts delivered in settlement thereof are the Participant’s sole responsibility. Neither the Company nor any of its Subsidiaries or Affiliates is responsible for any liability or penalty relating to taxes (including excise taxes) on compensation (including imputed compensation) or other income attributed to the Participant (or a Beneficiary) pursuant to this Agreement, whether as a result of the Participant failing to make timely payments of tax or otherwise. | |
Change of Control | This Performance Cash Award shall not vest or become immediately payable merely upon the occurrence of a Change of Control. However, the following provisions shall apply if a Change of Control occurs before the Vesting Date: (i) Upon the Change of Control, the Actual Payment Amount shall be fixed at no less than the Target Amount to be Paid Upon Vesting. Such Actual Payment Amount shall continue to be conditioned on the Participant providing services to the Company or a Subsidiary or Affiliate through the Vesting Date (subject to the provisions of the Plan, this Agreement and the Addendum with respect to Retirement, death and Disability, and paragraph (ii), below), and shall be paid at the time prescribed by this Agreement. (ii) If prior to the Vesting Date and within 24 months after the Change of Control, the Participant has a Termination of Employment either (1) by the Company (including its successor) or the Participant's employer without Cause or (2) if the Participant has “good reason” rights under the Company’s Executive Severance Plan or an employment agreement, by the Participant for “good reason” (as defined in the applicable plan or agreement), then (A) this Award shall become immediately vested and payable to the Participant, and (B) the Payment Date shall occur within 30 days after the Participant's Termination of Employment (subject to the six-month delay rule set forth in Section 11(o)(2) of the Plan). |
Retirement | If the Participant terminates service due to Retirement (as defined below) prior to the Vesting Date, the Participant shall vest in a portion of the Performance Cash Award. Such portion shall be calculated by (i) multiplying the Target Amount to be Paid Upon Vesting by a fraction (not to exceed 1.0), the numerator of which is the Participant’s number of completed months of service with the Company, its Subsidiaries or Affiliates from the Date of the Award to the Participant’s Termination of Service, and the denominator of which is the number of months from the Date of the Award to the scheduled Vesting Date (such resulting amount, the “Reduced Target Amount to be Paid Upon Vesting”), and (ii) further adjusting the Reduced Target Amount to be Paid Upon Vesting up or down based on actual performance through the end of the Performance Period. Such vested portion shall be paid on the Payment Date prescribed by this Agreement, and any portion of the Award that is not vested shall be forfeited without consideration. For purposes of this Agreement, “Retirement” means a voluntary Termination of Service with the Company’s approval after the Participant has attained age 55 and ten (10) years of matching contribution service under the Interpublic Group of Companies, Inc. Savings Plan (or, if the Participant is not eligible to participate in the Interpublic Group of Companies, Inc. Savings Plan, vesting service under the Participant’s employer’s 401(k) plan). For purposes of this Agreement, “Termination of Service” means the date the Participant ceases to provide material services to the Company and its Affiliates and Subsidiaries, which includes service as an employee, board member or consultant, as determined by the Company in its sole discretion. | |
Death or Disability | If the Participant terminates service due to Disability or death, the Participant shall vest in a portion of the Award as determined in accordance with the below if (and only if) Termination of Employment due to death or Disability occurs at least 12 months after the start of the Performance Period: The vested portion of the Award shall be calculated by (i) multiplying the Target Amount to be Paid Upon Vesting by a fraction (not to exceed 1.0), the numerator of which is the Participant’s number of completed months of service with the Company and its Subsidiaries or Affiliates from the Date of the Award to the Participant’s Termination of Service, and the denominator of which is the number of months from the Date of the Award to the scheduled Vesting Date (such resulting amount, the “Reduced Target Amount to be Paid Upon Vesting”), and (ii) further adjusting the Reduced Target Amount to be Paid Upon Vesting up or down based on performance (as described in the following sentence) through the end of the Performance Period. In the case of death, performance will be based on actual performance through the date of death and estimated performance for the remainder of the Performance Period; in the case of Disability, performance will be based on actual performance through the end of the Performance Period. | |
Compliance with Local Laws | If the Participant is a resident of or employed in a country other than the United States, the Participant agrees, as a condition of the Performance Cash Award, to repatriate all payments attributable to the Performance Cash Award in accordance with local foreign exchange rules and regulations in the Participant's country of residence (and country of employment, if different). In addition, the Participant agrees to take any and all actions, and consents to any and all actions taken by the Company and the Participant's employer as may be required to allow the Company and the Participant's employer to comply with local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). Finally, the Participant agrees to take any and all actions that may be required to comply with the Participant's personal legal and tax obligations under local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). | |
EU Age Discrimination Rules | If the Participant is resident and/or employed in a country that is a member of the European Union, the grant of the Performance Cash Award and this Agreement are intended to comply with the age discrimination provisions of the EU Equal Treatment Framework Directive, as implemented into local law (the “Age Discrimination Rules”). To the extent that a court or tribunal of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, in whole or in part, under the Age Discrimination Rules, the Company, in its sole discretion, shall have the power and authority to revise or strike such provision to the minimum extent necessary to make it valid and enforceable to the full extent permitted under local law. | |
Forfeiture of Award | Before accepting this Performance Cash Award, the Participant must disclose to the Company in writing all grants to the Participant of options, shares and other equity rights with respect to any Subsidiary of the Company ("Subsidiary Grants") that are still outstanding. Failure to disclose in writing the existence of any such outstanding Subsidiary Grants shall result in immediate cancellation and forfeiture of the Performance Cash Award set forth in this Agreement, unless the Administrator determines in its sole discretion that such failure was reasonable under the circumstances. |
Cancellation and Rescission for Prohibited Activity | Notwithstanding any other provision of the Plan or this Agreement, the Participant acknowledges and agrees that the Company may cancel, rescind, suspend, withhold, modify, amend or otherwise limit or restrict this Performance Cash Award (whether vested or not vested) at any time if the Participant is not in compliance with all applicable provisions of the Agreement and the Plan, or if the Participant engages in any “Prohibited Activity.” For purposes of this Agreement, “Prohibited Activity” means: (i) any activity that would enable the Company (or any Subsidiary or Affiliate where the Participant is employed) to terminate the Participant's employment for cause (as defined in the Plan or any employment agreement or other plan or arrangement that covers the Participant); (ii) a material violation of any rule, policy or procedure of the Company (or any Subsidiary or Affiliate where the Participant is employed), including but not limited to the Code of Conduct of the Company (and any such Subsidiary or Affiliate); (iii) before a Change of Control, a failure to be in compliance with any share ownership objectives of the Company applicable to the Participant, or (iv) before a Change of Control, any other conduct or act that the Company determines is injurious, detrimental or prejudicial to any interest of the Company. The Participant agrees that the cancellation and rescission provisions of this Agreement are reasonable and agrees not to challenge the reasonableness of such provisions, even where forfeiture of this Agreement is the penalty for violation; provided that the Participant may challenge the reasonableness of any forfeiture that occurs after a Change of Control. | |
No Employment Rights | The grant of the Performance Cash Award shall not be interpreted to form an employment contract between the Participant and the Company or the Participant's employer. | |
Discretionary Nature of Award | The Participant acknowledges and agrees that the Plan is discretionary in nature and may be amended, cancelled or terminated by the Company, in its sole discretion, at any time. The grant of the Performance Cash Award under the Plan is a one-time benefit and does not create any contractual or other right to receive a grant of a Performance Cash Award or any other forms of award permitted under the Plan or other benefits in lieu thereof in the future. Future grants, if any, will be at the sole discretion of the Company, including, but not limited to, the form and timing of any grant, the amount of the cash payment granted and the vesting provisions. Any amendment, modification or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Participant's employment with the Participant's employer. | |
Extraordinary Benefit | The Participant's participation in the Plan is voluntary. The value of the Performance Cash Award and any other awards granted under the Plan is an extraordinary item of compensation outside the scope of the Participant's employment (and the Participant's employment contract, if any). Any grant under the Plan, including the grant of the Performance Cash Award, is not part of the Participant's normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, holiday pay, pension, or retirement benefits or similar payments. | |
Value of Benefit | The future value of the Actual Payment Amount subject to the Performance Cash Award is unknown and cannot be predicted with certainty. The Company shall not be liable for any foreign exchange rate fluctuation, where applicable, between the Participant's local currency and the United States dollar that may affect the value of the Performance Cash Award or of any amounts due to the Participant pursuant to the settlement of the Performance Cash Award. | |
No Public Offering | The grant of the Performance Cash Award is not intended to be a public offering of securities in the Participant's country of residence (and country of employment, if different). The Company has not submitted any registration statement, prospectus or other filings with the local securities authorities (unless otherwise required under local law). No employee of the Company or its Subsidiaries or Affiliates is permitted to provide the Participant with any legal, tax or financial advice with respect to the grant of the Performance Cash Award. The Participant should carefully review all of the materials related to the Performance Cash Award and the Plan, and the Participant should consult with the Participant's personal legal, tax and financial advisors for professional advice in relation to the Participant's personal circumstances. | |
Recoupment | Notwithstanding any other provision of this Agreement to the contrary, the Participant acknowledges and agrees that the Performance Cash Award, or any amount received with respect thereto are subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of any recoupment policy the Company may establish or adopt ("Recoupment Policy") and as the Recoupment Policy may be amended from time to time. The Participant agrees and consents to the Company's application, implementation and enforcement of (a) the Recoupment Policy, and (b) any provision of applicable law relating to cancellation, recoupment, rescission or payback of compensation and expressly agrees that the Company may take such actions as are necessary to effectuate the Recoupment Policy (as applicable to the Participant) or applicable law without further consent or action being required by the Participant. For purposes of the foregoing, the Participant expressly and explicitly authorizes the Company to issue instructions, on the Participant's behalf, to any brokerage firm and/or third party administrator engaged by the Company to hold any amounts acquired under the Plan to re-convey, transfer or otherwise return such amounts to the Company. To the extent that the terms of this Agreement and the Recoupment Policy conflict, the terms of the Recoupment Policy shall prevail. |
English Language | If the Participant is resident outside of the United States, the Participant acknowledges and agrees that it is the Participant's express intent that this Agreement, the Plan and all other documents, notices and legal proceedings entered into, given or instituted pursuant to the Performance Cash Award be drawn up in English. If the Participant receives this Agreement, the Plan or any other document related to the Performance Cash Award translated into a language other than English, and if the meaning of the translated version is different than the English version, the English version will control. | |
Electronic Delivery | The Company may, in its sole discretion, decide to deliver any documents related to the Performance Cash Award or other awards granted to the Participant under the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company. | |
Data Privacy | The Company is located at 909 Third Avenue, New York, New York 10022, United States of America and grants Performance Cash Awards under the Plan to employees of the Company and its Subsidiaries and Affiliates in its sole discretion. In conjunction with the Company’s grant of the Performance Cash Award under the Plan and its ongoing administration of such awards, the Company is providing the following information about its data collection, processing and transfer practices. In accepting the grant of the Performance Cash Awards, the Participant expressly and explicitly consents to the personal data activities as described herein. (a) Data Collection, Processing and Usage. The Company collects, processes and uses the Participant’s personal data, including the Participant’s name, home address, email address, telephone number, date of birth, social insurance number or other identification number, salary, citizenship, job title, any Shares or directorships held in the Company, and details of all Performance Cash Awards or any other equity compensation awards granted, canceled, exercised, vested, or outstanding in the Participant’s favor, which the Company receives from the Participant or the Participant’s employer. In granting the Performance Cash Awards under the Plan, the Company will collect the Participant’s personal data for purposes of allocating Shares in settlement of the Performance Cash Awards and implementing, administering and managing the Plan. The Company’s legal basis for the collection, processing and usage of the Participant’s personal data is the Participant’s consent.(b) Stock Plan Administration Service Provider. The Company transfers the Participant’s personal data to [UBS Financial Services, an independent service provider based in the United States of America], which assists the Company with the implementation, administration and management of the Plan (the “Stock Plan Administrator”). In the future, the Company may select a different Stock Plan Administrator and share the Participant’s personal data with another company that serves in a similar manner. The Stock Plan Administrator will open an account for the Participant to receive and trade Shares acquired under the Plan. The Participant will be asked to agree on separate terms and data processing practices with the Stock Plan Administrator, which is a condition to the Participant’s ability to participate in the Plan.(c) International Data Transfers. The Company and the Stock Plan Administrator are based in the United States of America. The Participant should note that the Participant’s country of residence may have enacted data privacy laws that are different from the United States of America. The Company’s legal basis for the transfer of the Participant’s personal data to the United States of America is the Participant’s consent.(d) Voluntariness and Consequences of Consent Denial or Withdrawal. The Participant’s participation in the Plan and his or her grant of consent is purely voluntary. The Participant may deny or withdraw his or her consent at any time. If the Participant does not consent, or if the Participant later withdraws his or her consent, the Participant may be unable to participate in the Plan. This would not affect the Participant’s existing employment or salary; instead, the Participant merely may forfeit the opportunities associated with the Plan.(e) Data Subjects Rights. The Participant may have a number of rights under the data privacy laws in the Participant’s country of residence. For example, the Participant’s rights may include the right to (i) request access or copies of personal data the Company processes, (ii) request rectification of incorrect data, (iii) request deletion of data, (iv) place restrictions on processing, (v) lodge complaints with competent authorities in the Participant’s country of residence, and/or (vi) request a list with the names and addresses of any potential recipients of the Participant’s personal data. To receive clarification regarding the Participant’s rights or to exercise his or her rights, the Participant should contact the Participant’s local HR manager. | |
Successors and Assigns | The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Participant and the Participant's beneficiaries, executors or administrators. |
Addendum | Notwithstanding any provisions of this Agreement to the contrary, the Performance Cash Award shall be subject to any special terms and conditions for the Participant's country of residence (and country of employment, if different) set forth in an addendum to this Agreement (an “Addendum”). Further, if the Participant transfers the Participant's residence and/or employment to another country reflected in an Addendum to this Agreement at the time of transfer, the special terms and conditions for such country will apply to the Participant to the extent the Company determines, in its sole discretion, that the application of such terms and conditions is necessary or advisable in order to comply with local law or to facilitate the operation and administration of the award and the Plan (or the Company may establish alternative terms and conditions as may be necessary or advisable to accommodate the Participant's transfer). In all circumstances, any applicable Addendum shall constitute part of this Agreement. | |
Additional Requirements | The Company reserves the right to impose other requirements on the Performance Cash Award and the Participant's participation in the Plan to the extent the Company determines, in its sole discretion, that such other requirements are necessary or advisable in order to comply with local law or to facilitate the operation and administration of the Performance Cash Award and the Plan. Such requirements may include (but are not limited to) requiring the Participant to sign any agreements or undertakings that may be necessary to accomplish the foregoing. | |
Severability | The invalidity or unenforceability of any provision of the Plan or this Agreement will not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement will be severable and enforceable to the extent permitted by law. | |
Interpretation and Construction | This Agreement and the Plan shall be construed and interpreted by the Administrator, in its sole discretion. Any interpretation or other determination by the Administrator (including, but not limited to, correction of any defect or omission and reconciliation of any inconsistency in the Agreement or the Plan) shall be binding and conclusive. All determinations regarding enforcement, waiver or modification of the cancellation and rescission and other provisions of this Agreement (including the provisions relating to termination of service, death and Disability) shall be made in the Company's sole discretion. Determinations made under this Agreement and the Plan need not be uniform and may be made selectively among individuals, whether or not such individuals are similarly situated. | |
Entire Understanding | This Agreement, the award letter (if any) from the Company, the terms of the Plan and the restrictive covenant agreement attached hereto as Exhibit B constitute the entire understanding between the Participant and the Company and its Subsidiaries and Affiliates regarding this Performance Cash Award. Any prior agreements, commitments, or negotiations concerning this Performance Cash Award are superseded. | |
Participant's Acknowledgement and Agreement | By accepting the grant of the Performance Cash Award, the Participant acknowledges that the Participant has read this Agreement, the Addendum to this Agreement (as applicable), the Plan, and the restrictive covenant agreement and the Participant specifically accepts and agrees to the provisions therein. |
Date of Award [DATE] | Participant's Name [NAME] | |
Amount to be Paid Upon Vesting | $[X] | |
Vesting Date | Subject to the (i) terms of the Plan, (ii) the forfeiture, cancellation, and rescission provisions of this Agreement and (iii) Participant's execution of the non-solicitation and non-service agreement that is attached hereto as Exhibit B, the scheduled Vesting Date for the Award is [DATE]. Except as otherwise provided in this Agreement or the Plan, if the Participant ceases to be an employee of the Company and its Affiliates before any portion of this Award becomes vested, the unvested portion shall be forfeited. Under all circumstances, vesting of the award is subject to the Participant's execution of this Agreement and Exhibit B. | |
Payment Date | Subject to the vesting conditions set forth herein, the Amount set forth above shall be paid to the Participant during the calendar year prescribed by Section 4.2 of the Plan no later than the last day of the applicable "2 ½ month period" set forth in Treas. Reg. Section 1.409A-1(b)(4)(i)(A). |
Payment of Award | The vested Award shall be paid on the Payment Date set forth above, in local currency by the Employer via local payroll. | |
Tax Withholding | The Company or the Employer may be required to withhold income and employment taxes when the Award is paid to the Participant. Regardless of any action the Company or the Employer takes with respect to any or all income tax (including U.S. federal, state and local taxes and/or non-U.S. taxes), social insurance, payroll tax, payment on account or other tax-related withholding (“Tax-Related Items”), the Participant acknowledges that the ultimate liability for all Tax-Related Items legally due by the Participant is and remains the Participant's responsibility. Neither the Company nor the Employer: (a) make any representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Award, including the grant of the Award, the vesting or settlement of the Award; or (b) commit to structure the terms of the grant or any aspect of the Award to reduce or eliminate the Participant's liability for Tax-Related Items. If the Participant's country of residence (and/or country of employment, if different) requires withholding of Tax-Related Items, the Company or the Employer may withhold a sufficient portion of the amount to be paid equal to the amount of Tax-Related Items required to be withheld. If the Participant relocates to another jurisdiction, the Participant is responsible for notifying the Company of such relocation and is responsible for compliance with all applicable tax requirements. If the Participant is subject to taxation in more than one jurisdiction, the Participant acknowledges that the Company or the Employer may be required to withhold or account for Tax-Related Items in more than one jurisdiction. By accepting this Award, the Participant expressly consents to the withholding methods as provided for hereunder. All other Tax-Related Items related to the Award and cash delivered in settlement thereof are the Participant’s sole responsibility. Neither the Company and its Affiliates nor the Employer shall be responsible for any liability or penalty relating to taxes (including excise taxes) on compensation (including imputed compensation) or other income attributed to the Participant (or a Beneficiary) pursuant to this Agreement, whether as a result of the Participant failing to make timely payments of tax or otherwise. | |
Change of Control | This Award shall not vest or become immediately payable merely upon the occurrence of a Change of Control. However, if prior to the Vesting Date and within 24 months after the Change of Control, the Participant’s employment with the Company and Affiliates is terminated involuntarily and without Cause, then this Award shall become immediately vested and payable to the Participant. | |
Death or Disability | If the Participant terminates service due to Disability or death, the Participant shall vest in a portion of the Award as follows, and the vested portion shall be paid as soon as practicable thereafter: The vested portion of the Award shall equal a fraction (not to exceed 1.0), the numerator of which is the Participant’s number of completed months of service with the Company and its Affiliates from the Date of Award to the Participant’s date of termination, and the denominator of which is the number of months from the Date of Award to the scheduled Vesting Date. | |
Compliance with Local Laws | If the Participant is a resident of or employed in a country other than the United States, the Participant agrees to take any and all actions, and consents to any and all actions taken by the Company and the Employer as may be required to allow the Company and the Employer to comply with local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). Additionally, the Participant agrees to take any and all actions that may be required to comply with the Participant's personal legal and tax obligations under local laws, rules and regulations in the Participant's country of residence (and country of employment, if different). | |
EU Age Discrimination Rules | If the Participant is a resident of and/or employed in a country that is a member of the European Union, the grant of the Award and this Agreement are intended to comply with the age discrimination provisions of the EU Equal Treatment Framework Directive, as implemented into local law (the “Age Discrimination Rules”). To the extent that a court or tribunal of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, in whole or in part, under the Age Discrimination Rules, the Company, in its sole discretion, shall have the power and authority to revise or strike such provision to the minimum extent necessary to make it valid and enforceable to the full extent permitted under local law. | |
Forfeiture of Award | Before accepting this Award, the Participant must disclose to the Company in writing all grants to the Participant of options, shares and other equity rights with respect to any Subsidiary of the Company ("Subsidiary Grants") that are still outstanding. Failure to disclose in writing the existence of any such outstanding Subsidiary Grants shall result in immediate cancellation and forfeiture of the Award set forth in this Agreement, unless the [Compensation Committee determines in its sole discretion that such failure was reasonable under the circumstances. |
Cancellation and Rescission | Participant agrees that the Company may cancel, withhold, amend or otherwise limit or restrict this Award (whether vested or not vested) at any time if the Participant is not in compliance with all applicable provisions of the Agreement and the Plan, or if the Participant engages in any “Prohibited Activity.” For purposes of this Agreement, “Prohibited Activity” includes: (i) any activity that would enable the Company to terminate the Participant’s employment for cause (as defined in the Plan or any employment agreement or other plan or arrangement that covers the Participant); (ii) a violation of any rule, policy or procedure of the Company, including but not limited to the Code of Conduct of the Company; or (iii) any other conduct or act that the Company determines is injurious, detrimental or prejudicial to any interest of the Company. Participant agrees that the cancellation and rescission provisions of this Agreement are reasonable and agrees not to challenge the reasonableness of such provisions, even where forfeiture of this Agreement is the penalty for violation. | |
No Employment Rights | The grant of the Award shall not be interpreted to form an employment contract between the Participant and the Company or the Employer. | |
Discretionary Nature of Award | The Participant acknowledges and agrees that the Plan is discretionary in nature and may be amended, cancelled or terminated by the Company, in its sole discretion, at any time. The grant of the Award under the Plan is a one-time benefit and does not create any contractual or other right to receive an Award or other benefits in lieu thereof in the future. Future grants, if any, will be at the sole discretion of the Company, including, but not limited to, the form and timing of any grant, the amount granted and the vesting provisions. Any amendment, modification or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Participant's employment with the Employer. | |
Extraordinary Benefit | The Participant's participation in the Plan is voluntary. The value of the Award and any other awards granted under the Plan is an extraordinary item of compensation outside the scope of the Participant's employment (and the Participant's employment contract, if any). Any grant under the Plan, including the grant of the Award, is not part of the Participant's normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, holiday pay, pension, or retirement benefits or similar payments. | |
Value of Benefit | If the Award is not paid in U.S. dollars, its future value is unknown and cannot be predicted with certainty. The Company shall not be liable for any foreign exchange rate fluctuation, where applicable, between the Participant’s local currency and the United States dollar that may affect the value of the Award or of any amounts due to the Participant pursuant to the settlement of the Award. | |
Recoupment | Notwithstanding any other provision of this Agreement to the contrary, the Participant acknowledges and agrees that the Award, or any amount received with respect thereto are subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of any recoupment policy the Company may establish or adopt ("Recoupment Policy") and as the Recoupment Policy may be amended from time to time. The Participant agrees and consents to the Company's application, implementation and enforcement of (a) the Recoupment Policy, and (b) any provision of applicable law relating to cancellation, recoupment, rescission or payback of compensation and expressly agrees that the Company may take such actions as are necessary to effectuate the Recoupment Policy (as applicable to the Participant) or applicable law without further consent or action being required by the Participant. For purposes of the foregoing, the Participant expressly and explicitly authorizes the Company to issue instructions, on the Participant's behalf, to any third party administrator engaged by the Company to hold any amounts acquired under the Plan to re-convey, transfer or otherwise return such amounts to the Company. To the extent that the terms of this Agreement and the Recoupment Policy conflict, the terms of the Recoupment Policy shall prevail. | |
English Language | If the Participant is resident outside of the United States, the Participant acknowledges and agrees that it is the Participant's express intent that this Agreement, the Plan and all other documents, notices and legal proceedings entered into, given or instituted pursuant to the Award be drawn up in English. If the Participant receives this Agreement, the Plan or any other document related to the Award translated into a language other than English, and if the meaning of the translated version is different than the English version, the English version will control. | |
Electronic Delivery | The Company may, in its sole discretion, decide to deliver any documents related to the Award or other awards granted to the Participant under the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company. |
Data Privacy | The Company is located at 909 Third Avenue, New York, New York 10022, United States of America and grants Awards under the Plan to employees of the Company and its Affiliates in its sole discretion. In conjunction with the Company’s grant of the Award under the Plan and its ongoing administration of such awards, the Company is providing the following information about its data collection, processing and transfer practices. In accepting the grant of the Award, the Participant expressly and explicitly consents to the personal data activities as described herein. (a) Data Collection, Processing and Usage. The Company collects, processes and uses the Participant’s personal data, including the Participant’s name, home address, email address, telephone number, date of birth, social insurance number or other identification number, salary, citizenship, job title, any shares or directorships held in the Company, and details of all Awards or any other equity compensation awards granted, canceled, exercised, vested, or outstanding in the Participant’s favor, which the Company receives from the Participant or the Employer ("Personal Data"). In granting the Awards under the Plan, the Company will collect the Participant’s Personal Data for purposes of paying the Awards and implementing, administering and managing the Plan. The Company’s legal basis for the collection, processing and usage of the Participant’s Personal Data is the Participant’s consent. (b) Third Party Administrators. The Company may transfer the Participant’s Personal Data to the Company's Affiliates outside of the United States of America, who assists the Company with the implementation, administration and management of the Plan, including the Affiliates payroll provider. In the future, the Company may share the Participant’s personal data with another company that serves in a similar manner. The Participant may be asked to agree to the terms and data processing practices with the Affiliate or the Affiliate's payroll provider, which is a condition to the Participant’s ability to participate in the Plan. (c) International Data Transfers. The Company is based in the United States of America. The Participant should note that the Participant’s country of residence may have enacted data privacy laws that are different from the United States of America. The Company’s legal basis for the transfer of the Participant’s Personal Data to the United States of America is the Participant’s consent. (d) Voluntariness and Consequences of Consent Denial or Withdrawal. The Participant’s participation in the Plan and his or her grant of consent is purely voluntary. The Participant may deny or withdraw his or her consent at any time. If the Participant does not consent, or if the Participant later withdraws his or her consent, the Participant may be unable to participate in the Plan. This would not affect the Participant’s existing employment or salary; instead, the Participant merely may forfeit the opportunities associated with the Plan. (e) Data Subjects Rights. The Participant may have a number of rights under the data privacy laws in the Participant’s country of residence. For example, the Participant’s rights may include the right to (i) request access or copies of Personal Data the Company processes, (ii) request rectification of incorrect Personal Data, (iii) request deletion of Personal Data, (iv) place restrictions on processing of Personal Data, (v) lodge complaints with competent authorities in the Participant’s country of residence, and/or (vi) request a list with the names and addresses of any potential recipients of the Participant’s Personal Data. To receive clarification regarding the Participant’s rights or to exercise his or her rights, the Participant should contact the Participant’s local HR manager. | |
Successors and Assigns | The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Participant and the Participant's beneficiaries, executors or administrators. | |
Addendum | Notwithstanding any provisions of this Agreement to the contrary, the Award shall be subject to any special terms and conditions for the Participant's country of residence (and country of employment, if different) set forth in an addendum to this Agreement (an “Addendum”). Further, if the Participant transfers the Participant's residence and/or employment to another country reflected in an Addendum to this Agreement at the time of transfer, the special terms and conditions for such country will apply to the Participant to the extent the Company determines, in its sole discretion, that the application of such terms and conditions is necessary or advisable in order to comply with local law or to facilitate the operation and administration of the award and the Plan (or the Company may establish alternative terms and conditions as may be necessary or advisable to accommodate the Participant's transfer). In all circumstances, any applicable Addendum shall constitute part of this Agreement. | |
Additional Requirements | The Company reserves the right to impose other requirements on the Award and the Participant's participation in the Plan to the extent the Company determines, in its sole discretion, that such other requirements are necessary or advisable in order to comply with local law or to facilitate the operation and administration of the Award and the Plan. Such requirements may include (but are not limited to) requiring the Participant to sign any agreements or undertakings that may be necessary to accomplish the foregoing. | |
Governing Law | The Award and the Plan shall be construed, administered, and regulated in accordance with the laws of the state of New York, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of the Plan to the substantive law of another jurisdiction. |
Severability | The invalidity or unenforceability of any provision of the Plan or this Agreement will not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement will be severable and enforceable to the extent permitted by law. | |
Interpretation and Construction | This Agreement and the Plan shall be construed and interpreted by the Committee, in its sole discretion. Any interpretation or other determination by the Committee (including, but not limited to, correction of any defect or omission and reconciliation of any inconsistency in the Agreement or the Plan) shall be binding and conclusive. All determinations regarding enforcement, waiver or modification of the cancellation and rescission and other provisions of this Agreement (including the provisions relating to termination of employment, death and disability) shall be made in the Company’s sole discretion. Determinations made under this Agreement and the Plan need not be uniform and may be made selectively among individuals, whether or not such individuals are similarly situated. | |
Entire Understanding | This Agreement, the terms of the Plan and the non-solicitation and non-service agreement attached hereto as Exhibit B constitute the entire understanding between the Participant and the Company and its Affiliates regarding this Award. Any prior agreements, commitments, or negotiations concerning this Award are superseded. | |
Participant’s Acknowledgement and Agreement | By accepting the grant of the Award, the Participant acknowledges that the Participant has read this Agreement), the Plan, and the non-solicitation and non-service agreement attached hereto as Exhibit B and the Participant specifically accepts and agrees to the provisions therein. |
Company Name | State (U.S.) | |
Acxiom LLC | Delaware | |
Business Science Research Corporation | Delaware | |
Campbell-Ewald Company | Delaware | |
Carmichael Lynch, Inc. | Minnesota | |
Chase Design Holdings, LLC | Delaware | |
CMGRP Entertainment, Inc. | California | |
Craft Translation, LLC | New York | |
DeVries Public Relations, Ltd. | New York | |
Genuine Interactive, LLC | Massachusetts | |
Gillespie, LLC | Delaware | |
Hello Elephant, LLC | Delaware | |
HG Group, LLC | Delaware | |
Huge, LLC | New York | |
Independent Advertising, Inc. | Delaware | |
IPG Asia & Oceania LLC | Delaware | |
Lowe & Partners Worldwide Inc. | Delaware | |
Lowe Group Holdings, Inc. | New York | |
McCann-Erickson Marketing, Inc. | New York | |
McCann-Erickson USA, Inc. | Delaware | |
McCann-Erickson Worldwide, Inc. | Delaware | |
McCannFC, Inc. | Georgia | |
Mediabrands Worldwide, Inc. | California | |
Momentum Events LLC | Delaware | |
Octagon, Inc. | District of Columbia | |
Optaros, Inc. | Delaware | |
Reprise Media, Inc. | Delaware | |
True North Communications Inc. | Delaware | |
Universal McCann Worldwide, Inc. | Delaware | |
Company Name | Country | |
Interpublic Group Deutschland GmbH | Germany | |
Interpublic Group of Companies de Espana, S.L. | Spain | |
Interpublic Limited | United Kingdom | |
IPG Advertising Israel Holdings Ltd | Israel | |
Kinesso Corp. | Canada | |
Orion Trading Canada Inc. | Canada | |
The Interpublic Group of Companies Canada, Inc. | Canada |
/s/ Michael I. Roth | /s/ Jocelyn Carter-Miller | |
Michael I. Roth | Jocelyn Carter-Miller | |
/s/ H. John Greeniaus | /s/ Mary J. Steele Guilfoile | |
H. John Greeniaus | Mary J. Steele Guilfoile | |
/s/ Dawn Hudson | /s/ William T. Kerr | |
Dawn Hudson | William T. Kerr | |
/s/ Henry S. Miller | /s/ Jonathan F. Miller | |
Henry S. Miller | Jonathan F. Miller | |
/s/ Patrick Q. Moore | /s/ Linda S. Sanford | |
Patrick Q. Moore | Linda S. Sanford | |
/s/ David M. Thomas | /s/ E. Lee Wyatt Jr. | |
David M. Thomas | E. Lee Wyatt Jr. | |
/s/ Christopher F. Carroll | /s/ Ellen Johnson | |
Christopher F. Carroll | Ellen Johnson |
/s/ Andrew Bonzani |
Andrew Bonzani |
1. | I have reviewed this Annual Report on Form 10-K of The Interpublic Group of Companies, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: February 21, 2020 | /s/ Michael I. Roth |
Michael I. Roth | |
Chairman and Chief Executive Officer |
1. | I have reviewed this Annual Report on Form 10-K of The Interpublic Group of Companies, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: February 21, 2020 | /s/ Ellen Johnson |
Ellen Johnson | |
Executive Vice President and Chief Financial Officer |
Dated: February 21, 2020 | /s/ Michael I. Roth |
Michael I. Roth | |
Chairman and Chief Executive Officer |
Dated: February 21, 2020 | /s/ Ellen Johnson |
Ellen Johnson | |
Executive Vice President and Chief Financial Officer |