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Exhibit 10.3

 

ELLEN JOHNSON

Senior Vice President & Treasurer

Tel: (212) 704-1222

Fax: (212) 704-2229

ejohnson@interpublic.com

   

 

 

 

As of March 31, 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, 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 (the “Credit Agreement”). 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 will be unable 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 (the “SEC”), by
March 16, 2005 its annual report for the same period on Form 10-K (the “2004
Filing Event”). Additionally, the Company may be unable to complete the
preparation of, and to deliver, the unaudited financial statements of the
Company and its Consolidated Subsidiaries for the fiscal quarter ending March
31, 2005 by May 20, 2005 and to file with the SEC by May 10, 2005 its quarterly
report for such period on Form 10-Q (the “First Quarter  

 

 

 

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Filing Event” and, together with the 2004 Filing Event, the “Filing Events”).
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.
Either or both of 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 Company’s public debt indentures and 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. In addition,
the failure to deliver a written statement by the Company’s auditors in
connection with the Company’s financial statements for the fiscal year ended
December 31, 2004 (the “Auditor Statement Event”) may result in a breach of such
indentures, which may also constitute a Default under the Credit Agreement.
Furthermore, either or both of 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 June 30, 2005, with respect to
the 2004 Filing Event and the Auditor Statement Event, and July 31, 2005, with
respect to First Quarter Filing Event, 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 or the Auditor
Statement Event.

B.

Restatement of Financial Statements

We have advised you that the Company may need to restate its Consolidated
financial statements for one or more periods ending prior to December 31, 2004
(such restatements, collectively, the “Restatements”), and accordingly, the
Company may be in violation of its obligations under Sections 5.01(a), 5.01(f)
and other provisions of the Credit Agreement. The Restatements may also result
in certifications and representations and warranties of the Company made or
deemed made pursuant to the Credit Agreement and other credit or ISDA agreements
entered into by the Company and/or its Consolidated Subsidiaries or contained in
certificates, financial statements and other documents delivered pursuant to
such agreements, in each case, prior to the date hereof having been incorrect
when made or deemed made. Furthermore, the Restatements 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 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 these matters, in each case, solely to the extent related
to the Restatements provided that no such Restatements resulting from
intentional misstatements have a material negative impact on the Company’s
financial condition.

 

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

 

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Upon the completion of the Restatements, the Company will deliver to the Agent a
copy of any restated financial statements, together with a certificate of the
chief financial officer or chief accounting officer of the Company, which
certificate shall include a statement that such officer has no knowledge, except
as specifically stated, of any condition, event or act which constitutes a
Default.

C.

Amendment of Financial Covenants

We have also advised you that the Company may experience a decline in EBITDA for
the 2004 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. 2 to the Credit
Agreement (the “Amendment”) by executing and delivering such amendment.

D.

Sarbanes-Oxley Compliance

Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, the Company is
subject to new reporting requirements in 2005 relating to internal control over
financial reporting.

The Company’s filings under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”) may not comply with the requirements of the Exchange Act in one
or more of the following respects:

(a)

the Company’s annual report on Form 10-K for the fiscal year ended December 31,
2004 may

 

»

omit management’s annual report on internal control over financial reporting
required by Item 308(a) of Regulation S-K,

 

»

omit the attestation report of the registered public accounting firm required by
Item 308(b) of Regulation S-K, or include an attestation report that is
qualified or disclaimed,

 

»

omit the certification required by Rule 13a-14(a) of the Exchange Act, or

 

»

omit the certification pursuant to 18 U.S.C. §1350 required by Rule 13a-14(b) of
the Exchange Act, or include a certification that does not conform to the
requirements of such rule; and

 

 

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

 

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(b)

the Company’s quarterly reports on Form 10-Q for each of the first three fiscal
quarters of 2005 may omit the certification required by Rule 13a-14(a) of the
Exchange Act.

Any such failure to comply with the Exchange Act could violate Section 5.01(a)
and other provisions of the Credit Agreement as well as certain provisions of
the other credit or ISDA agreements entered into by the Company and/or its
Consolidated Subsidiaries. Any such failure to comply with the Exchange Act in
conjunction with an enforcement or other action by any governmental body, agency
or official or self regulatory organization in respect of such failure to comply
with the Exchange Act could also result in the Company’s inability to make the
representation and warranty in the last sentence of Section 4.01(e) of the
Credit Agreement.

The Company requests that the Lenders waive any breach, Default and related
Event of Default 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 failure to meet any such conditions relates to any
such breach, Default or Event of Default or inability (as a result of an
enforcement or other action by any governmental body, agency or official or self
regulatory organization in respect of such failure to comply with the Exchange
Act) to make the representation or warranty in the last sentence of Section
4.01(e) of the Credit Agreement, in each case, up to and including March 1,
2006. For the avoidance of doubt, any waiver granted by the Lenders pursuant to
this paragraph shall not extend to any failure to comply with the requirements
of the Exchange Act with respect to the Company’s annual report on Form 10-K for
the fiscal year ending December 31, 2005.

* * *

The Credit Agreement and the Notes 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.

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, 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 to each Lender who has executed and
delivered this letter agreement and the 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

 

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

 

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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 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.

 

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 waiver) 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

 

 

Confirmed and Agreed:

 

 

CITIBANK, N.A.,
as Agent and as Lender

By: /s/ Julio Ojea Quintana                               
Title: Director

 

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/ Deborah Carlson                                  
Title:  Vice President

           

 By: /s/ Windsor R. Davies                                
Title:  Director

 

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

 

 

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

 

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UBS LOAN FINANCE LLC

By:  /s/ Wilfred V. Saint                            
Title: Director

By:  /s/ Winslowe Ogbourne                   
Title: Associate Director

 

SUNTRUST BANK

 By:  /s/ Heidi M. Khambatta                    
Title: Director

 

CALYON NEW YORK BRANCH

 By:  /s/ Michael Madnick                         
Title: Director  

By: /s/ Scott R. Chappelka                      
Title: Director

 

 

 

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

 

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