As of June 1, 2000
Mr. A. J. C. Smith
630 Park Avenue
New York, NY 10021
Dear Ian:
The purpose of this letter agreement is to set forth the arrangements that you
and Jeff Greenberg have agreed to regarding your services as a consultant to
Marsh & McLennan Companies, Inc. (the "Company") and certain other matters.
1. Term. The Company agrees to engage you as a consultant for the period
commencing as of June 1, 2000 through May 31, 2001 at which time the Company and
you may consider the continuation of this arrangement or its amendment. In this
role, you will be referred to as Senior Advisor.
2. Duties. From time to time during the Term, as and when requested by Jeff
Greenberg, or as otherwise authorized by him, you will provide advisory and
consultative services for or on behalf of the Company or its affiliates on
subjects, projects and special assignments, subject to your reasonable
convenience and other personal and business activities. You will continue as
Chairman of the Company's International Advisory Board and serve in your current
term as a Trustee of various Putnam Funds.
It is anticipated that your services will be required for at least
two-thirds of your time during the Term. This engagement is not exclusive, but
you agree to consult with the Company before accepting other professional
commitments, including commercial enterprise board of director seats.
The consulting and advisory services to be performed by you shall be as an
independent contractor, not as an employee of the Company, and may be performed
on or off the Company's premises, at your discretion. You will be provided with
office space and secretarial support on the 44th floor at 1166 Avenue of the
Americas, as well as use of a company-provided car and driver as you may require
to perform your duties in this role.
You will not have any authority to bind the Company. You shall not be
entitled to any employee benefits in this role, and the Company will not
exercise any control or direction regarding your performance of the
above-described services but will require that the results achieved be
acceptable.
<PAGE>
A. J. C. Smith
Page Two
3. Payment for Services. As consideration for your consulting services
hereunder, the Company will pay you an annual fee of $1,250,000 in equal monthly
installments in arrears. If you are unable to perform the services called for
herein for any part of the Term, your fee will be prorated. You will not be
entitled to any remuneration other than as described herein and as a Director of
the Company. You accept full and complete responsibility for meeting all tax
requirements and paying all income and self-employment taxes that may be
required or due for payments received from the Company under the terms and
conditions of this agreement. The Company will reimburse you for the reasonable,
ordinary and necessary expenses incurred by you in the performance of your
consulting services upon the submission of reports and documentation in
accordance with the Company's procedures. You will be eligible to participate in
the Executive Financial Services Program through the year 2001. With respect to
your company-provided personal automobile, we agree to consider an appropriate
transfer of ownership to you at the end of the Term or at a future date if the
Term is extended.
4. Prohibition of Disclosure of Information. You recognize and acknowledge that
the confidential or proprietary information of the Company and its affiliates
are valuable, special and unique assets of the Company's business. You will not,
during or after the Term, in whole or in part, disclose such secrets or
confidential proprietary information to any person, firm, corporation,
association or other entity for any reason or purpose whatsoever, nor shall you
make use of any such property for your own purposes or for the benefit of any
person, firm, corporation or other entity (except the Company and its
affiliates) under any circumstances, during or after the Term.
If the foregoing is acceptable, kindly execute the enclosed copy of this
letter and return it to me.
Very truly yours,
MARSH & McLENNAN COMPANIES, INC.
By: __________________________________
Francis N. Bonsignore
AGREED TO AND ACCEPTED:
By:___________________________
A. J. C. Smith Date
cc: Jeffrey W. Greenberg
Gregory Van Gundy
