Exhibit 4.21
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OGILVY & MATHER EXECUTIVE SAVINGS PLAN
SUMMARY PLAN DESCRIPTION
APRIL 2001
25%
OGILVY & MATHER EXECUTIVE SAVINGS PLAN
SUMMARY PLAN DESCRIPTION
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INTRODUCTION
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This booklet is your Summary Plan Description ("SPD") for the Ogilvy & Mather
Executive Savings Plan (the "Executive Savings Plan"). The Executive Savings
Plan is designed to recognize your individual contribution to Ogilvy & Mather's
overall team effort by giving you an opportunity to defer receipt of a portion
of your income, thereby deferring taxes and by giving you a 25% matching
contribution of your deferral. The Executive Savings Plan helps you to
supplement your retirement benefits.
You should read this booklet carefully and refer here first when you have any
questions about the Executive Savings Plan. If this SPD does not answer your
questions, or if you need further information, you may contact the Corporate
Human Resources Department at Ogilvy & Mather, 309 West 49/th/ Street, New York,
NY 10019, 212-237-4000.
April 2001
OGILVY & MATHER EXECUTIVE SAVINGS PLAN SUMMARY PLAN DESCRIPTION
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HOW DOES THE PLAN WORK?
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The Executive Savings Plan is a "non-qualified plan," which is a promise by an
employer to participants to pay income, at some future date, for services
performed currently. By deferring income into the Executive Savings Plan,
amounts are sheltered from immediate income taxes (but not FICA taxes), by
deferring the payment of income taxes until you receive a distribution from the
Plan (which is when you leave employ with Ogilvy & Mather (the "Company"), or
when you retire, whichever comes first). All future deferred income payments
are subject to income tax withholding.
It is important to note that once you choose to participate in this Executive
Savings Plan, you cannot stop deferrals during the calendar year; however, you
do have the option not to participate the following year.
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WHEN AM I ELIGIBLE TO PARTICIPATE?
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Participation in the Executive Savings Plan is limited to key employees and is
by personal invitation only. Membership is highly selective to ensure a
meaningful financial opportunity for all participants. You are invited to
participate during the Annual Plan Offering, which is held in November or
December of each year for the following year, or when you are first hired (you
must elect to participate within 30 days of your hire date). Participation is
totally voluntary.
One of the requirements of this kind of plan is that you must elect to defer
income before you receive it - therefore, should you not elect to participate in
the Executive Savings Plan during the designated entry periods as described
above, you will have to wait until the next Annual Plan Offering. Please note
that invitations are given each year - participation for one year does not
guarantee an invitation to participate the following year. In addition, you
must elect to defer income in order to receive the Company match.
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HOW MUCH CAN I DEFER?
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You can defer up to 10% of your annual base salary. Under the Executive Savings
Plan, your deferrals earn interest at the prime rate determined as of the first
of each month compounded monthly. The earnings also accumulate tax-deferred.
If you do not participate in any year, your account balance will continue to be
credited with interest until it is distributed to you.
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WHAT IS THE COMPANY MATCH?
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The Company will automatically match 25% of your deferrals each year. The match
is credited to you monthly.
Please note that if you choose not to defer into the Executive Savings Plan, you
will not receive any Company match - the match is contingent upon you
participating in the Plan.
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WHAT IS PENSION MAKEUP?
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Because of IRS rules and regulations, income that you defer into the Executive
Savings Plan is not considered eligible compensation for the purpose of
calculating The Company's contribution to your Account Balance Defined Benefit
Plan or your contributions to the 401(k) Plan. In order to keep you from being
penalized by these rules and regulations, The Company will credit your account
with 10% of the amount you are deferring to the Executive Savings Plan. So, if
you are deferring $1,000 per month, The Company will credit you with 10% of the
deferral ($100) as a "pension make-up."
You will receive this pension make-up when you begin deferring into the
Executive Savings Plan, regardless of whether or not you are eligible to
participate in the Account Balance Plan at that time.
Your other group benefits (such as life insurance and long term disability) are
not affected by your decision to defer income.
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HOW ARE PLAN DEFERRALS RECORDED?
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The Executive Savings Plan is intended to be an unfunded unsecured plan
maintained by the Company primarily for the purpose of providing deferred
compensation for a select group of management or highly compensated employees
pursuant to ERISA Sections 201(2), 301(a)(3) and 401(a)(1). When you defer
income, an entry is made in a ledger showing that you were owed income by the
Company and that you chose to defer receipt until a later date. The interest
and Company credits are recorded in the same ledger.
Benefits under the Executive Savings Plan are paid out of the Company's general
assets and are therefore not protected from claims by the Company's creditors.
There is no trust and nothing contained in this Executive Savings Plan or any
action taken with respect to the provisions herein is intended to create a trust
of any kind. You are relying on the Company's promise to pay the Executive
Savings Plan's benefits in the future. Should the Company become insolvent or
bankrupt, you will have no greater rights to your Executive Savings Plan
benefits than a general unsecured creditor.
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You may purchase a surety bond from a surety company or a letter of credit from
a bank to secure your deferred compensation payments should the Company default
on those payments. A surety bond is a type of performance bond issued by a
surety insurance company. You would pay the premium to the surety insurance
company for the bond coverage. The Company cannot be involved, either directly
or indirectly, in the purchase of the surety bond or letter of credit as this
will be viewed by the IRS as creating a funded non-qualified plan that will be
currently taxable to you. If you wish to purchase a surety bond or letter of
credit, we strongly advise that you consult the services of a tax professional.
You will receive quarterly statements showing your deferrals, the Company match,
pension make-up, and interest so you can monitor the growth of your benefit.
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WHEN WILL I BE ENTITLED TO RECEIVE MY BENEFIT?
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You will receive a distribution of your Executive Savings Plan benefits when you
terminate employment with the Company (regardless of whether or not you transfer
to another WPP Company) or when you retire, whichever comes first.
The distributed benefits are included in your gross income in the year in which
they are received by you and are subject to income taxes. Since FICA taxes were
paid at the time of deferral, no FICA taxes will be withheld at the time of
distribution.
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HOW WILL MY BENEFIT BE PAID?
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No withdrawals are permitted from the Executive Savings Plan while you are still
an active Company employee and no loans are permitted at any time. If you leave
the Company for any reason, your benefit will be paid to you in a lump sum
within 60 days following your termination or retirement date (subject to income
tax withholding).
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WHAT HAPPENS IF I DIE?
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If you die before receiving your benefit from the Executive Savings Plan, the
benefits will be paid to your designated Beneficiary in one lump sum. When you
are given the opportunity to participate in the Plan, you will receive a
Beneficiary Designation form. You may designate of one or more persons as the
Beneficiary or Beneficiaries who will be entitled to receive the amount payable
under from the Executive Savings Plan upon your death. You may, from time to
time, revoke or change your Beneficiary designation by filing a new designation
with the Company.
The last Beneficiary designation received by the Company will be controlling.
No designation, change or revocation of a Beneficiary designation will be
effective unless received by the Company prior to your death. If no such
Beneficiary designation is in effect at the time of your death, or if no
designated Beneficiary survives you, the
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payment of any Executive Savings Plan benefits upon your death will be made to
your surviving spouse, or if you have no surviving spouse, to your children, or
if you have no children, to the legal representative of your estate.
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WHAT ELSE SHOULD I KNOW?
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Incompetent Payee
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If anyone entitled to a benefit becomes legally incapacitated or is otherwise
unable to manage his financial affairs, the Company may pay his benefit to
someone else (such as a named Beneficiary or duly appointed representative or
guardian) for the benefit of that person.
Employment Rights Not Implied
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Participation in the Executive Savings Plan neither gives an Employee the right
to be retained in the employ of the Company, nor guarantees his rights or claim
to any benefit except as specified in the Executive Savings Plan.
Interpretation
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The Company shall have full power and authority to interpret and administer the
Executive Savings Plan. The Company's interpretation and construction of any
provision or action taken under the Executive Savings Plan shall be binding and
conclusive on all persons for all purposes.
Claims Procedure
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Initial Claims
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If you or your Beneficiary do not receive a benefit to which you believe you are
entitled, you or your Beneficiary must file a written claim with the Company.
The Company will provide you or your Beneficiary with the necessary information
and make all determinations as to the right of any person to a disputed benefit.
Your claim will be processed within 90 days (in special circumstances, this
period may be extended for an additional 90 days by written notice to you). If
your claim has been denied, you will be notified in writing and such
notification will include the reasons for the denial, specific references to
pertinent plan provisions, and a description of any additional material or
information regarding your claim.
If notification of approval of a claim is not received within the time limits
set forth above, the claim will automatically be considered denied.
Disputed Claims
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If you are dissatisfied with any decision on your claim, you have the right to
request, in writing, a review of the decision. You also have the right to
review pertinent documents
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and to submit issues and comments in writing. A request for review, giving the
reason the decision is believed to be in error, must be made not later than 60
days after a decision on a claim is received.
All requests for review of determinations under the Executive Savings Plan
should be addressed to the Company at the address specified in the Introduction
to this SPD.
Within 60 days of receipt of a request for review of the disputed claim (in
special circumstances, 120 days, by written notice to you), the Company will
review the claim and advise you or your Beneficiary, in writing, of its
determination. The Company's decision on appeal will be final.
If notification of determination of a claim is not received within the time
limits set forth above, the claim will automatically be considered denied.
Assignment
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The right of any participant or any other person to the payment of benefits
under the Executive Savings Plan shall not be assigned, transferred, pledged or
otherwise encumbered.
Amendment and Termination
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The Company reserved the right to amend, modify or terminate the Executive
Savings Plan at anytime. Any such action by the Company shall not reduce the
benefits you have accrued to the date of such action.
Governing Law
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To the extent not preempted by ERISA, the Executive Savings Plan shall be
governed by the laws of the State of New York.
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