Exhibit 10.20
This document constitutes part of
a prospectus covering securities that have
been registered under the
Securities Act of 1933.
The date of this prospectus is
[Date].
MARSH & McLENNAN COMPANIES,
INC.
2000 SENIOR EXECUTIVE INCENTIVE AND
STOCK AWARD PLAN
AND
2000 EMPLOYEE INCENTIVE AND STOCK AWARD
PLAN
Terms and Conditions for Award of
Deferred Stock Units
to U.S. Award
Recipients
This award of deferred stock units
has been granted to you on [Award Date] (the “ Award
Date ”) under the Marsh & McLennan Companies,
Inc. 2000 Senior Executive Incentive and Stock Award Plan or the
Marsh & McLennan Companies, Inc. 2000 Employee Incentive
and Stock Award Plan (as applicable to you, the “ Plan
”) as specified in the Award Letter (defined below). For
purposes of these Terms and Conditions, “ MMC ”
means Marsh & McLennan Companies, Inc. and any successor
thereto.
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I.
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GRANT,
VESTING AND DISTRIBUTION OF AWARD; RESTRICTIVE COVENANTS
AGREEMENT
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1.
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The letter
delivered to you from MMC’s Chief Executive Officer dated
[Date of Award], (the “ Award Letter ”)
specifies the number of deferred stock units that comprises your
individual award (the “ Award ”). You must
execute a Restrictive Covenants Agreement (as described in Section
I.C.) by the date specified in the Award Letter to accept the
Award.
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1.
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General . A deferred stock unit (“ DSU
”) represents an unfunded and unsecured promise to deliver
(or cause to be delivered) to you, subject to these Terms and
Conditions and the terms and conditions of the Plan, one
(1) share of MMC common stock as soon as practicable after
vesting or as otherwise provided herein.
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2.
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Vesting . Subject to your continued employment, the DSUs
are scheduled to vest on the [Vesting Date] of the Award Date (the
“ Scheduled Vesting Date ”). If your employment
terminates prior to the Scheduled Vesting Date, your right to the
DSUs will be determined in accordance with Section III
below.
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3.
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Delivery of
Shares . Shares of MMC
common stock in respect of the DSUs covered by the Award shall be
distributed to you as soon as practicable after vesting, and in no
event later than 60 days after vesting. The delivery of shares in
respect of your deferred stock units is conditioned on your
(i) having timely signed and returned a copy of the
Restrictive Covenants Agreement (defined below) to MMC as
instructed and (ii) satisfaction of any applicable tax
withholding with respect to the Award.
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C.
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Restrictive
Covenants Agreement
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As provided in these Terms and
Conditions, you must execute a Restrictive Covenants Agreement in a
form determined by MMC (“ Restrictive Covenants
Agreement ”) to accept your Award and for your Award to
vest upon certain terminations of employment. The Restrictive
Covenants Agreement generally applies for a period of one year
commencing with your termination of employment. A copy of the
Restrictive Covenants Agreement is enclosed. You may wish to
consider consulting an attorney at your own expense before signing
the Restrictive Covenants Agreement. Please retain a copy of your
signed Restrictive Covenants Agreement for your records. Failure to
timely execute and comply with the Restrictive Covenants Agreement
by the date specified in the Award Letter will result in forfeiture
of all of your rights, title and interest in and to the
Award.
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II.
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RIGHTS OF
DEFERRED STOCK UNITS
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A.
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Unless and
until both the vesting conditions of the Award have been satisfied
and shares of MMC common stock have been delivered to you in
accordance with the terms and conditions described herein, you have
only the rights of a general unsecured creditor and you have none
of the attributes of ownership to such shares of stock (e.g., units
cannot be used as payment for stock option exercises; units may not
be transferred or assigned; units have no voting
rights).
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B.
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Dividend
equivalents are payable on each DSU at or after the time of
distribution of any dividend paid by MMC in respect of a share of
its common stock (a “ Dividend Payment Date ”),
the record date of which occurs on or after the Award Date. You
shall be entitled to receive an amount (less applicable
withholding) equal to such dividend payment as would have been made
in respect of one (1) share of MMC common stock for each DSU
covered by the Award. Payment of a dividend equivalent shall be
made only with respect to DSUs that are outstanding on the
ex-dividend date.
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III.
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TERMINATION
OF EMPLOYMENT
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If your employment with MMC or any
of its subsidiaries or affiliates (the “ Company
”) terminates, the following shall apply:
In the event your employment is
terminated because of your death, the DSUs will vest at such
termination of employment.
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Upon the occurrence of your
Permanent Disability (as defined in Section III.G.), the DSUs will
vest provided that you satisfy the condition to vesting described
in Section III.F.
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C.
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Termination
Other Than For Cause
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1.
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In the event
your employment is terminated by the Company other than for Cause
(as defined below), the Award will vest on a pro rata basis at such
termination of employment provided that you satisfy the condition
to vesting described in Section III.F. The portion of DSUs under
the Award that vest is equal to a fraction, the numerator of which
is the number of days from the Award Date to the date of your
termination of employment, and the denominator of which is the
number of days from the Award Date to the Scheduled Vesting
Date.
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2.
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For purposes of
these Terms and Conditions, “ Cause ” shall
mean:
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i.
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willful failure
to substantially perform the duties consistent with your position
which is not remedied within 30 days after receipt of written
notice from the Company specifying such failure;
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ii.
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willful
violation of any written company policies including but not limited
to, the Company’s Code of Business Conduct &
Ethics;
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iii.
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commission at
any time of any act or omission that results in a conviction, plea
of no contest, plea of nolo contendere, or imposition of
unadjudicated probation for any felony or crime involving moral
turpitude;
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iv.
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unlawful use
(including being under the influence) or possession of illegal
drugs;
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v.
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any gross
negligence or willful misconduct resulting in a material loss to
the Company or any of its subsidiaries, or material damage to the
reputation of the Company or any of its subsidiaries; or
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vi.
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any violation
of any statutory or common law duty of loyalty to the Company or
any of its subsidiaries, including the commission at any time of
any act of fraud, embezzlement, or material breach of fiduciary
duty against the Company or any of its subsidiaries.
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D.
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Sale of
Business Unit For Which You Work
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In the event of a sale or similar
transaction involving the business unit for which you work (the
“ Employing Company ”) as a result of which the
Employing Company ceases to be a subsidiary of MMC, your
termination of employment will be treated as a Termination Other
than for Cause.
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E.
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All Other
Employment Terminations
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For all other terminations of
employment, all of your rights, title and interest in and to the
Award, whether vested or unvested, shall be forfeited on the date
of such termination of employment, except to the extent that the
Compensation Committee of the MMC Board
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of Directors (the “
Committee ”) may determine otherwise. For purposes of
these Terms and Conditions, your employment will be treated as
terminated when you are no longer employed by MMC or any affiliate
or subsidiary of MMC.
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F.
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Condition to
Vesting of Award Upon Termination of Employment
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In the event of your termination of
employment due to Permanent Disability or Termination other than
for Cause as described in Section III.B or C, any unvested portion
of the Award will vest as provided in Section III.B or C;
provided that you reaffirm your Restrictive Covenants
Agreement within 30 days following your termination of employment.
Failure to timely reaffirm and comply with the Restrictive
Covenants Agreement will result in forfeiture of all of your
rights, title and interest in and to the Award, whether vested or
unvested.
As used in these terms and
conditions, “ Permanent Disability ” will be
deemed to occur when MMC’s disability carrier determines that
you are unable to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment
that can be expected to result in death or can be expected to last
for a continuous period of not less than 12 months.
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IV.
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CHANGE IN
CONTROL PROVISIONS
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A.
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Change in
Control if Award is Assumed by a Successor
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1.
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Upon the
occurrence of a “ Change in Control ” of MMC, as
defined in the Plan, if the Award is Assumed (as defined in Section
IV.A.2) by the entity effecting the Change in Control, the Award
will become fully vested upon the earlier of the next Scheduled
Vesting Date and your termination of employment without Cause or
for Good Reason (as defined in the next sentence) during the
24-month period following such Change in Control. For purposes of
these Terms and Conditions, “ Good Reason ”
includes any of the following without your written consent:
(i) a material reduction in your base salary; (ii) a
material reduction in your annual incentive opportunity (including
a material adverse change in the method of calculating your annual
incentive); (iii) a material diminution of your duties,
responsibilities or authority; or (iv) a relocation of more
than 50 miles from your office location in effect immediately prior
to the Change in Control; provided that you provide MMC with
written notice of your intent to terminate your employment for Good
Reason within 60 days of your becoming aware of any circumstances
set forth above (with such notice indicating the specific
termination provision above on which you are relying and describing
in reasonable detail the facts and circumstances claimed to provide
a basis for termination of your employment under the indicated
provision) and that you provide MMC with at least 30 days following
receipt of such notice to remedy such circumstances.
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2.
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For purposes of
these Terms and Conditions, an Award will be considered assumed
(“ Assumed ”) if the following conditions are
met:
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i.
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The Award is
converted into a replacement award (the “ Replacement
Award ”) covering a number of shares of the entity
effecting the Change in Control (or a successor or parent
corporation), as determined in a manner substantially similar to
the treatment of an equal number of shares of MMC stock covered by
the Award; provided that to the extent that any portion of
the consideration received by holders of MMC common stock in the
Change Control transaction is not in the form of the common stock
of such entity (or a successor or parent corporation), the number
of shares covered by the replacement award shall be based on the
average of the high and low selling prices of the common stock of
such entity (or a successor or parent corporation) on the
established stock exchange on the trading day immediately preceding
the date of the Change in Control.
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ii.
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The Replacement
Award contains provisions for scheduled vesting and treatment on
termination of employment (including the definition of Cause) that
are no less favorable to you than the Awar
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