Exhibit 10.3

 

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ELLEN JOHNSON
Senior Vice President & Treasurer
Tel: (212) 704-1222
Fax: (212) 704-2229
ejohnson@interpublic.com

 

 

 

 

As of June 22, 2005

To the banks, financial institutions
    and other institutional lenders
    (collectively, the "Lenders")
    parties to the Credit Agreement
    referred to below and to Citibank, N.A.,
    as agent (the "Agent") for the Lenders

Ladies and Gentlemen:

     We refer to the 364-Day Credit Agreement, dated as of May 10, 2004, as
amended as of September 29, 2004 and March 31, 2005 (the “Credit Agreement”) and
the letter dated as of March 31, 2005 relating to the waiver by the Lenders of
certain breaches, defaults or events of default (or potential breaches, defaults
or events of default) under the Credit Agreement (the “March 31 Waiver Letter”),
each among The Interpublic Group of Companies, Inc., a Delaware corporation (the
"Company"), the banks, financial institutions and other institutional lenders
parties to the Credit Agreement (collectively, the "Lenders") and Citibank,
N.A., as administrative agent (the "Agent") for the Lenders. Capitalized terms
used but not defined herein are used with the meanings given to those terms in
the Credit Agreement.

     A.    Filing Events

     We have advised you that the Company would be unable (a) to complete the
preparation of, and to deliver, the audited financial statements of the Company
and its Consolidated Subsidiaries for the fiscal year ended December 31, 2004 by
April 5, 2005, and to file with the Securities and Exchange Commission (“SEC”)
its annual report for the same period on Form 10-K, by March 16, 2005 (the “2004
Filing Event”), (b) to complete the preparation of, and to deliver, the
unaudited financial statements of

 

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the Company and its Consolidated Subsidiaries for the fiscal quarter ending
March 31, 2005 by May 20, 2005, and to file with the SEC its quarterly report
for such period on Form 10-Q, by May 10, 2005 (the “First Quarter Filing Event”)
and (c) to complete the preparation of, and to deliver, the unaudited financial
statements of the Company and its Consolidated Subsidiaries for the fiscal
quarter ending June 30, 2005 by August 20, 2005 and to file with the SEC by
August 9, 2005 its quarterly report for such period on Form 10-Q (the “Second
Quarter Filing Event” and together with the 2004 Filing Event and the First
Quarter Filing Event, the “Filing Events”). Any or all of the Filing Events may
constitute a breach of the Company’s obligations under Sections 5.01(h)(ii) and
5.01(h)(i) of the Credit Agreement, respectively. The Filing Events may also
constitute a breach of Sections 5.01(a), 5.01(f) and other provisions of the
Credit Agreement and may result in a breach of the other credit or ISDA
agreements entered into by the Company and/or its Consolidated Subsidiaries,
each of which may constitute a Default under the Credit Agreement. Furthermore,
the Filing Events may result in the Company’s inability to make the
representation and warranty contained in the last sentence of Section 4.01(e).

     The Company requests that the Lenders waive until September 30, 2005 with
respect to the Filing Events, any breach, Default and related Event of Default
in connection with the matters described in the preceding paragraph and any
conditions precedent to borrowing contained in Section 3.03 of the Credit
Agreement to the extent that the Company’s inability to meet any such conditions
relates to the Filing Events or any such breach, Default or Event of Default, in
each case, solely to the extent related to the Filing Events.

     B.    Amendment of Financial Covenants

     We have also advised you that the Company may experience a decline in
EBITDA for the rolling four quarters ending each of the first two quarters of
the 2005 fiscal year. As a result of this decline, (x) the Company may be in
violation of Sections 5.03(a), 5.03(b) and 5.03(c) of the Credit Agreement and
(y) the Company may not be able to make the representation and warranty
contained in the last sentence of Section 4.01(e) of the Credit Agreement in
connection with Borrowings made on or after the date hereof. To avoid any such
violation or misrepresentation, the Company requests that the Lenders amend
Section 5.03, as set forth in the accompanying Amendment No. 3 to the Credit
Agreement (the “Amendment”) by executing and delivering such amendment.

* * *

     The Credit Agreement, the Notes and the March 31 Waiver Letter (except as
expressly superseded hereby) are and shall continue to be in full force and
effect and are hereby in all respects ratified and confirmed. The execution,
delivery and effectiveness of this letter agreement shall not, except as
expressly provided herein, operate as a waiver of any right, power or remedy of
any Lender or the Agent under the Credit Agreement, nor constitute a waiver of
any provision of the Credit Agreement.

 

1114 Avenue of the Americas, New York, New York 10036 Tel: (212) 704-1222 Fax:
(212) 704-2229
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     Upon the effectiveness of this letter agreement and the accompanying
amendment, each dated as of the date hereof, and the letter agreement and the
accompanying amendment (the “Related Citibank Waiver and Amendment”), each dated
as of the date hereof related to the 3-Year Credit Agreement by and among the
Company, the Lenders and the Agent, dated as of May 10, 2004, the Company agrees
to pay each Lender who has executed and delivered this letter agreement, the
Amendment and the Related Citibank Waiver and Amendment a fee equal to 0.125% of
such Lender’s Commitment. The Company also agrees to pay on demand all
reasonable costs and expenses of the Agent in connection with the preparation,
execution, delivery and administration, modification and amendment of this
letter agreement and the other instruments and documents to be delivered
hereunder (including, without limitation, the reasonable fees and expenses of
counsel for the Agent) in accordance with the terms of Section 9.04 of the
Credit Agreement.

     This letter agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement. Delivery of an executed counterpart of a
signature page to this letter agreement by telecopier shall be effective as
delivery of a manually executed counterpart of this letter agreement.

     In accordance with Section 9.01 of the Credit Agreement, this waiver will
become effective as of the date when the Agent has received counterparts of this
letter agreement executed by the Company and the Required Lenders or, as to any
of the Lenders, advice satisfactory to the Agent that such Lender has executed
this letter agreement.

     This letter agreement shall be governed by, and construed in accordance
with, the laws of the State of New York, without regard to principles of
conflicts of law to the extent that the application of the laws of another
jurisdiction would be required thereby.

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1114 Avenue of the Americas, New York, New York 10036 Tel: (212) 704-1222 Fax:
(212) 704-2229
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Please indicate your agreement with the foregoing (including the waivers
requested herein) by having the enclosed duplicate copy of this letter agreement
executed in the space provided below by a duly authorized representative and
return the same to us.

 

THE INTERPUBLIC GROUP OF
COMPANIES, INC.

By:   /s/ Ellen Johnson                                               
Title: Senior Vice President and Treasurer

 

 

 

1114 Avenue of the Americas, New York, New York 10036 Tel: (212) 704-1222 Fax:
(212) 704-2229
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Confirmed and Agreed:

 

 

CITIBANK, N.A.,

as Agent and as Lender

By: /s/ Carolyn A. Kee  

Title: Vice President

 

JPMORGAN CHASE BANK

By:  /s/ George Catallo  

Title: Vice President

 

KEYBANK NATIONAL ASSOCIATION

By:  /s/ Francis W. Lutz,  Jr.  

Title: Vice President

 

LLOYDS TSB BANK PLC

By: /s/ Nicholas J. Bruce  

Title:  Vice President

By: /s/ Stuart Taylor   

Title:  Senior Vice President

 

HSBC BANK USA

By: /s/ Robert Elms  

Title: Vice President

 

ING BANK

By: /s/ Bill James  

Title: Managing Director

 

ROYAL BANK OF CANADA

By: /s/ Dustin Craven  

Title: Attorney-In-Fact

 

 

 

 

 

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UBS LOAN FINANCE LLC

By:  /s/ Wilfred V. Saint  

Title: Director

By:  /s/ Richard L. Tavrow  

Title: Director 

 

SUNTRUST BANK

By:  /s/ Katherine L. Bass  

Title: Vice President

 

 

 

 

 

 

 

 

 

 

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