Gatfield Takes Lowe CEO Job for 3 Years

NEW YORK New Lowe worldwide CEO Stephen Gatfield will lead the agency for just three years, and, in the final year, he will hand off to a successor, said agency parent Interpublic Group in a Thursday filing with the Securities and Exchange Commission.

“It is understood that the final year of the Lowe assignment will involve the transition of executive responsibilities to successor Lowe Worldwide management,” IPG said in the filing, known as an 8-K.

The document, which also details how Gatfield will be compensated in his new role, comes a week after IPG confirmed that Gatfield, an executive vice president at the corporate level, had replaced Tony Wright as CEO. At that time, IPG said Wright would shift to worldwide chairman.

Thursday’s filing, however, said Gatfield would also take the chairman’s title, effective May 1. But an IPG representative said Thursday night that was not the case. “This was an unfortunate clerical error,” said the rep, who added that there was no change in Wright’s status or title.

In an 8-K/A filing on Friday, IPG said Thursday’s document “incorrectly indicated” that Gatfield would be chairman. “The report should have stated that Mr. Gatfield, in addition to his current title and position, has been named chief executive officer of Lowe Worldwide. As the company announced last week, Wright will remain with Lowe and become its chairman, reporting to the CEO,” IPG said in the latest filing.

To run Lowe, IPG will pay Gatfield an annual salary of $892,500, up slightly from the $850,000 he made as evp for strategy and network operations, according to the 8-K. Gatfield, 47, also will get bonuses for 2005, 2006 and at the end of his contract, on April 15, 2009.

The bonuses will be based on a percentage of his base salary. For example, for 2005, when his salary was $850,000, he will get a bonus equal to 110 percent of that base ($935,000), according to the filing. The 2006 bonus will equal 50 percent of $892,500 ($446,250) and in 2009, the final year of his deal, the bonus will be 150 percent of that base ($1.3 million).

Gatfield’s new contract also provides 50,000 restricted shares of IPG stock that will vest in 2008, continued participation in IPG’s long-term incentive programs and perks such as rental housing, a car lease and a health club membership.