Company Notice to Holders of Notes – Put Option Expiration Date – Interpublic Group of Companies, Inc.
COMPANY NOTICE
TO HOLDERS OF THE
4.25% CONVERTIBLE SENIOR NOTES DUE 2023
ISSUED BY
THE INTERPUBLIC GROUP OF COMPANIES, INC.
CUSIP Numbers: 460690 BA 7 and 460690 AZ 3
NOTICE IS HEREBY GIVEN pursuant to the terms and conditions of the Senior
Debt Indenture, dated as of November 15, 2006 (the “Base Indenture”), between
The Interpublic Group of Companies, Inc., a Delaware corporation (the “Company”)
and The Bank of New York, a New York banking corporation, as trustee (the
“Trustee”), as supplemented by the First Supplemental Indenture, dated as of
November 15, 2006 (the “First Supplemental Indenture” and, together with the
Base Indenture, the “Indenture”), between the Company and the Trustee, relating
to the Company153s 4.25% Convertible Senior Notes due 2023 (the “Notes”), that at
the option of the holders thereof (each, a “Holder”), the Notes will be
purchased by the Company for a purchase price (the “Purchase Price”) equal to
$1,000 per $1,000 principal amount of the Notes, plus any accrued and unpaid
interest (including contingent interest) up to, but excluding, March 15, 2012
(the “Purchase Date”), upon the terms and subject to the conditions set forth in
the Indenture and the Notes. The Purchase Date is an Interest Payment Date under
the terms of the Indenture. Accordingly, interest accrued up to, but excluding,
the Purchase Date will be paid to record holders as of the Regular Record Date,
as defined in the Indenture, and we expect that there will be no accrued and
unpaid interest due as part of the Purchase Price. The right of a Holder to
require the Company to purchase the Notes, as described in this Company Notice
and the related notice materials, as amended and supplemented from time to time,
is referred to herein as the “Put Option.” This Company Notice is being sent
pursuant to Section 2.05 of the First Supplemental Indenture and the provisions
of the Notes. All capitalized terms used but not specifically defined herein
shall have the meanings given to such terms in the Indenture and the Notes.
To exercise the Put Option for your Notes, you must complete and
deliver the enclosed Letter of Transmittal and Purchase Notice (the “Purchase
Notice”) to the Paying Agent before 11:59 p.m., New York City time, on
Wednesday, March 14, 2012 (the “Expiration Date”). A Purchase Notice may be
withdrawn at any time before 11:59 p.m., New York City time, on the Expiration
Date. The Put Option expires at 11:59 p.m., New York City time, on the
Expiration Date.
HOLDERS WHO HOLD THEIR NOTES THROUGH THE DEPOSITORY TRUST COMPANY
(“DTC”) WHO WISH TO EXERCISE THE PUT OPTION AND DELIVER THEIR NOTES TO THE
PAYING AGENT NEED NOT SUBMIT A PHYSICAL PURCHASE NOTICE TO THE PAYING AGENT IF
SUCH HOLDERS TRANSMIT THEIR ACCEPTANCE AND DELIVER THEIR NOTES ELECTRONICALLY
THROUGH DTC153S AUTOMATED TENDER OFFER PROGRAM (“ATOP”), SUBJECT TO THE TERMS AND
PROCEDURES OF THAT SYSTEM. HOLDERS TRANSMITTING THEIR ACCEPTANCE AND DELIVERING
THEIR NOTES THROUGH DTC153S ATOP SYSTEM MUST ALLOW SUFFICIENT TIME FOR COMPLETION
OF THE ATOP PROCEDURES DURING THE NORMAL BUSINESS HOURS OF DTC.
The Paying Agent is The Bank of New York. The address of the Paying Agent is:
Bank of New York Mellon Corporation
Corporate Trust Reorganization Unit
101 Barclay Street:7 East
New York, New York 10286
Attention: Carolle Montreuil
Telephone: (212) 815-5920
Fax: (212) 298-1915
Additional copies of this Company Notice may be obtained from the Paying
Agent at its addresses set forth above.
The date of this Company Notice is February 15, 2012.
TABLE OF CONTENTS
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2.6. |
Holder153s |
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3. |
Procedures |
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5. |
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8. |
Interests |
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SCHEDULE |
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No person has been authorized to give any information or to make any
representations other than those contained in this Company Notice and
accompanying Purchase Notice and, if given or made, such information or
representations must not be relied upon as having been authorized. This Company
Notice and accompanying Purchase Notice do not constitute an offer to buy or the
solicitation of an offer to sell securities in any circumstances or jurisdiction
in which such offer or solicitation is unlawful. The delivery of this Company
Notice shall not, under any circumstances, create any implication that the
information contained herein is current as of any time subsequent to the date of
such information. None of the Company, its Board of Directors or its employees
is making any representation or recommendation to any Holder as to whether to
exercise or refrain from exercising the Put Option. You should consult your own
financial and tax advisors and must make your own decision as to whether to
exercise the Put Option and, if so, the amount of Notes for which to exercise
the Put Option.
i
SUMMARY TERM SHEET
The following are answers to some of the questions that you may have
about the Put Option. To understand the Put Option fully and for a more detailed
description of the terms of the Put Option, we urge you to read carefully the
remainder of this Company Notice and the accompanying Purchase Notice because
those documents contain additional important information. We have included page
references to direct you to a more detailed description of the topics in this
summary.
Who is obligated to purchase my Notes?
The Interpublic Group of Companies, Inc., a Delaware corporation (the
“Company”), is obligated, at your option, to purchase its 4.25% Convertible
Senior Notes due 2023 (the “Notes”). (See Page 5)
Why are you obligated to purchase my Notes?
The right of each holder (each, a “Holder”) of the Notes to sell and our
obligation to purchase the Notes pursuant to the Put Option is a term of the
Notes under the Senior Debt Indenture, dated as of November 15, 2006 (the “Base
Indenture”), between the Company and The Bank of New York, a New York banking
corporation, as trustee (the “Trustee”), as supplemented by the First
Supplemental Indenture, dated as of November 15, 2006 (the “First Supplemental
Indenture” and, together with the Base Indenture, the “Indenture”), between the
Company and the Trustee, and has been a right of Holders from the time the Notes
were issued. (See Page 5)
What securities are you obligated to purchase?
We are obligated to purchase all of the Notes for which a Purchase Notice has
been validly delivered and not withdrawn. As of February 14, 2012, there was
$400.0 million in aggregate principal amount of the Notes outstanding. (See Page
5)
How much will you pay and what is the form of payment?
Pursuant to the terms of the Indenture and the Notes, we will pay, in cash, a
purchase price (the “Purchase Price”) equal to $1,000 per $1,000 principal
amount of the Notes, plus any accrued and unpaid interest (including contingent
interest) up to, but excluding, March 15, 2012 (the “Purchase Date”), with
respect to any and all Notes for which a Purchase Notice has been validly
delivered and not withdrawn. The Purchase Date is an Interest Payment Date under
the terms of the Indenture. Accordingly, interest accrued up to, but excluding,
the Purchase Date will be paid to record holders as of the Regular Record Date,
as defined in the Indenture, and we expect that there will be no accrued and
unpaid interest due as part of the Purchase Price. (See Pages 5-6)
How can I determine the market value of the Notes?
There is no established reporting system or market for trading in the Notes.
To the extent that the Notes are traded, prices of the Notes may fluctuate
widely depending on trading volume, the balance between buy and sell orders,
prevailing interest rates, the market price of our common stock, par value $0.10
per share (the “Common Stock”), our operating results and the market for similar
securities. Holders are urged to obtain current market quotations for the Notes,
to the extent available, before making any decision with respect to the Put
Option. Shares of our Common Stock, into which the Notes are convertible, are
listed on the New York Stock Exchange (the “NYSE”) under the symbol “IPG.” On
February 14, 2012 the last reported sales price of our Common Stock on the NYSE
was $10.70 per share. (See Pages 6-7)
1
What does the Company153s Board of Directors think of the Put Option?
Although the Company153s Board of Directors approved the terms of Notes,
including the Put Option, before the Notes were issued, it has not made any
recommendation as to whether you should exercise or refrain from exercising the
Put Option. You must make your own decision whether to exercise the Put Option
and, if so, the amount of Notes for which to exercise the Put Option. (See Page
6)
When does the Put Option expire?
The Put Option expires at 11:59 p.m., New York City time, on March 14, 2012
(the “Expiration Date”). The period that Holders have to exercise the Put Option
will not be extended unless required by applicable law. (See Page 5)
What are the conditions to the Company153s purchase of the Notes?
Provided that the Company153s purchase of validly delivered Notes is not
unlawful and that no event of default under the Indenture has occurred and is
continuing (other than an event of default that is cured by the payment of the
Purchase Price), the purchase will not be subject to any conditions. Delivery of
the Notes to the Paying Agent or delivery of the Notes by book-entry transfer to
the account maintained by the Paying Agent with The Depository Trust Company
(“DTC”) is a condition to the payment of the Purchase Price to the Holder of
such Notes. (See Page 5)
How do I exercise the Put Option?
To exercise the Put Option, you must deliver the Purchase Notice, together
with any other required documents, to the Paying Agent before 11:59 p.m., New
York City time, on the Expiration Date.
HOLDERS WHO HOLD THEIR NOTES THROUGH DTC WHO WISH TO EXERCISE THE PUT
OPTION AND DELIVER THEIR NOTES TO THE PAYING AGENT NEED NOT SUBMIT A PHYSICAL
PURCHASE NOTICE TO THE PAYING AGENT IF SUCH HOLDERS TRANSMIT THEIR ACCEPTANCE
AND DELIVER THEIR NOTES ELECTRONICALLY THROUGH DTC153S AUTOMATED TENDER OFFER
PROGRAM (“ATOP”), SUBJECT TO THE TERMS AND PROCEDURES OF THAT SYSTEM. HOLDERS
TRANSMITTING THEIR ACCEPTANCE AND DELIVERING THEIR NOTES THROUGH DTC153S ATOP
SYSTEM MUST ALLOW SUFFICIENT TIME FOR COMPLETION OF THE ATOP PROCEDURES DURING
THE NORMAL BUSINESS HOURS OF DTC.
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Holders whose Notes are held in certificated form who wish to exercise the |
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Holders who are DTC participants who wish to exercise the Put Option and |
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Holders who are DTC participants may elect to deliver a completed and |
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Holders whose Notes are held by a broker, dealer, commercial bank, trust |
2
Holders who wish to exercise the Put Option without simultaneously delivering
their Notes to the Paying Agent must (i) properly complete and execute the
Purchase Notice, (ii) check the appropriate box in the section of the Purchase
Notice entitled “Method of Delivery” to indicate that Notes are not
simultaneously delivered to the Paying Agent and (iii) deliver the Purchase
Notice, together with any other required documents, to the Paying Agent before
11:59 p.m., New York City time, on the Expiration Date. Delivery of Notes to the
Paying Agent or delivery of the Notes by book-entry transfer to the account
maintained by the Paying Agent with DTC is a condition to the payment of the
Purchase Price to the Holder of such Notes. (See Pages 7-9)
If I exercise the Put Option, when will I receive payment for my
Notes?
If you exercise the Put Option, you must deliver the Notes for which you have
delivered a Purchase Notice (together with all necessary endorsements) to the
Paying Agent or deliver such Notes by book-entry transfer to the Paying Agent153s
account at DTC prior to, on or after the Purchase Date. Your delivery of the
Notes to the Paying Agent or delivery of the Notes by book-entry transfer to the
account maintained by the Paying Agent with DTC is a condition to your receipt
of the Purchase Price for such Notes. (See Pages 7-8)
HOLDERS WHO HOLD THEIR NOTES THROUGH DTC NEED NOT DELIVER PHYSICAL
NOTE CERTIFICATES TO THE PAYING AGENT IF SUCH HOLDERS COMPLY WITH THE DELIVERY
PROCEDURES OF DTC.
We will accept for payment all validly delivered Notes promptly following
expiration of the Put Option. At or before 10:00 a.m., New York City time, on
March 15, 2012, we will deposit with the Paying Agent the appropriate amount of
cash required to pay the Purchase Price for the Notes for which a Purchase
Notice has been validly delivered and not withdrawn by 11:59 p.m., New York City
time, on the Expiration Date. The Paying Agent will pay cash to the Holders
promptly following the later of the Purchase Date and the time of delivery or
book-entry transfer of such Holders153 Notes to the Paying Agent. (See Pages 9-11)
Can I withdraw a previously delivered Purchase Notice?
Yes. To withdraw a previously delivered Purchase Notice, you must deliver an
executed written notice of withdrawal substantially in the form attached, or a
facsimile of one, to the Paying Agent before 11:59 p.m., New York City time, on
the Expiration Date. (See Pages 9-10)
HOLDERS WHO EXERCISED THE PUT OPTION AND DELIVERED THEIR NOTES TO THE
PAYING AGENT THROUGH DTC153S ATOP SYSTEM SHOULD ELECTRONICALLY TRANSMIT THEIR
WITHDRAWAL THROUGH DTC153S ATOP SYSTEM, SUBJECT TO THE TERMS AND PROCEDURES OF
THAT SYSTEM. HOLDERS TRANSMITTING THEIR WITHDRAWAL THROUGH DTC153S ATOP SYSTEM
MUST ALLOW SUFFICIENT TIME FOR COMPLETION OF THE ATOP PROCEDURES DURING THE
NORMAL BUSINESS HOURS OF DTC.
Do I need to do anything if I do not wish to exercise the Put Option?
No. (See Page 7)
If I choose to exercise the Put Option, do I have to exercise the Put
Option for all of my Notes?
No. You may exercise the Put Option for all of your Notes, a portion of your
Notes or none of your Notes. If you wish to exercise the Put Option for a
portion of your Notes, however, you must exercise the Put Option for Notes in a
principal amount of $1,000 or an integral multiple thereof. (See Page 7)
3
If I do not exercise the Put Option, will I continue to be able to
exercise my conversion rights?
Yes. If you do not exercise the Put Option, your conversion rights will not
be affected. You will continue to have the right to convert each $1,000
principal amount of the Notes into 82.4612 shares of our Common Stock, subject
to the terms, conditions and adjustments specified in the Indenture and the
Notes. (See Page 6)
If I am a U.S. resident for U.S. federal income tax purposes, will I
have to pay taxes if I exercise the Put Option?
The receipt of cash in exchange for Notes pursuant to the Put Option will be
a taxable transaction for U.S. federal income tax purposes and you may recognize
income, loss or deduction. You should consult with your own tax advisor
regarding the actual tax consequences to you. (See Pages 12-13)
Who is the Paying Agent?
The Bank of New York, the trustee under the Indenture, is serving as Paying
Agent for the Notes. Its address and telephone and fax numbers are set forth on
the front cover of this Company Notice.
Whom can I contact if I have questions about the Put Option?
Questions and requests for assistance in connection with the Put Option may
be directed to the Paying Agent at the address and telephone and fax numbers set
forth on the front cover of this Company Notice.
4
IMPORTANT INFORMATION CONCERNING THE PUT OPTION
1. Information Concerning the Company. The Interpublic Group
of Companies, Inc., a Delaware corporation (the “Company” or “we”), is obligated
to purchase its 4.25% Convertible Senior Notes due 2023 (the “Notes”) for which
Purchase Notices have been validly delivered and not withdrawn. The Notes are
convertible into shares of common stock, par value $0.10 per share (the “Common
Stock”), of the Company, subject to the terms, conditions and adjustments
specified in the Indenture and the Notes. The Company is both the “filing
person” and the “subject company.”
We are one of the world153s premier global advertising and marketing services
companies. Through our 42,000 employees in all major world markets, our
companies specialize in consumer advertising, digital marketing, communications
planning and media buying, public relations and specialized communications
disciplines. Our agencies create customized marketing programs for many of the
world153s largest companies. Comprehensive global services are critical to
effectively serve our multinational and local clients in markets throughout the
world, as they seek to build brands, increase sales of their products and
services and gain market share.
The work we produce for our clients is specific to their unique needs. Our
solutions vary from project-based activity involving one agency to long-term,
fully integrated campaigns created by multiple Company agencies working
together. With offices in over 100 countries, we can operate in a single region,
or deliver global integrated programs.
Our principal executive offices are located at 1114 Avenue of the Americas,
New York, New York, 10036. Our main telephone number at that address is (212)
704-1200. Our website address is www.interpublic.com. We have not incorporated
by reference into this Company Notice the information included on or linked from
our website, and you should not consider it to be a part of this Company Notice.
2. Information Concerning the Notes. On November 15, 2006,
we issued $400.0 million in aggregate principal amount of the Notes. Cash
interest accrues on the Notes at the rate of 4.25% per annum and is payable
semi-annually on March 15 and September 15 of each year to the person in whose
name a Note is registered at the close of business on the preceding March 1 or
September 1, as the case may be. The Notes mature on March 15, 2023. As of
February 14, 2012, there was $400.0 million in aggregate principal amount of the
Notes outstanding.
2.1. The Company153s Obligation to Purchase the
Notes. Pursuant to the terms of the Notes and the Indenture, we
are obligated to purchase all of the Notes for which Purchase Notices have been
validly delivered and not withdrawn at a purchase price (the “Purchase Price”)
equal to $1,000 per $1,000 principal amount of the Notes, plus any accrued and
unpaid interest (including contingent interest) up to, but excluding, March 15,
2012 (the “Purchase Date”). The Purchase Date is an Interest Payment Date under
the terms of the Indenture. Accordingly, interest accrued up to, but excluding,
the Purchase Date will be paid to record holders as of the Regular Record Date,
as defined in the Indenture, and we expect that there will be no accrued and
unpaid interest due as part of the Purchase Price.
The Put Option will expire at 11:59 p.m., New York City time, on March 14,
2012 (the “Expiration Date”). The period that Holders have to exercise the Put
Option will not be extended unless required by applicable law.
The purchase by the Company of validly delivered Notes is not subject to any
conditions other than (1) that no event of default under the Indenture has
occurred and is continuing (other than an event of default that is cured by the
payment of the Purchase Price) and (2) that the Company153s purchase is not
unlawful. Delivery of Notes to the Paying Agent or delivery of the Notes by
book-entry transfer to the account maintained by the Paying Agent with The
Depository Trust Company (“DTC”) is a condition to the payment of the Purchase
Price to the Holder of such Notes.
5
2.2. Purchase Price. Pursuant to terms of the
Indenture and the Notes, the Purchase Price to be paid by the Company for the
Notes is equal to $1,000 per $1,000 principal amount of the Notes, plus any
accrued and unpaid interest (including contingent interest) up to, but
excluding, the Purchase Date. The Purchase Date is an Interest Payment Date
under the terms of the Indenture. Accordingly, interest accrued up to, but
excluding, the Purchase Date will be paid to record holders as of the Regular
Record Date, as defined in the Indenture, and we expect that there will be no
accrued and unpaid interest due as part of the Purchase Price. The Purchase
Price will be paid in cash with respect to any and all Notes for which a
Purchase Notice has been validly delivered and not withdrawn. Notes will be
accepted for purchase only in principal amounts equal to $1,000 or integral
multiples thereof. The Paying Agent will pay the Purchase Price to the Holders
promptly following the later of the Purchase Date and the time of delivery or
book-entry transfer of such Holders153 Notes to the Paying Agent in accordance
with the procedures described in this Company Notice.
With respect to Notes for which a Purchase Notice has been validly delivered
and not withdrawn, interest (including contingent interest) will accrue up to,
but excluding, the Purchase Date, unless the Company defaults in making payment
of the Purchase Price for such Notes.
The Purchase Price is based solely on the requirements of the Indenture and
the Notes and does not necessarily bear any relationship to the market price of
the Notes or our Common Stock. Thus, the Purchase Price may be significantly
higher or lower than the current market price of the Notes. Holders of Notes are
urged to obtain the best available information as to potential current market
prices of the Notes, to the extent available, and our Common Stock before making
a decision whether to exercise the Put Option.
None of the Company, its Board of Directors or its employees is making any
recommendation to Holders as to whether to exercise or refrain from exercising
the Put Option. Each Holder must make his or her own decision whether to
exercise the Put Option and, if so, the principal amount of Notes for which to
exercise the Put Option based on such Holder153s assessment of the current market
value of the Notes and our Common Stock and other relevant factors.
2.3. Conversion Rights of the Notes. Upon the
occurrence of an event listed in paragraph 9 of the Notes, the Notes will be
convertible into shares of our Common Stock in accordance with and subject to
the terms of the Indenture and the Notes. The conversion rate of the Notes is
82.4612 shares of Common Stock per $1,000 principal amount of the Notes. The
Paying Agent is currently acting as Conversion Agent for the Notes.
Holders who do not exercise the Put Option will maintain the right to convert
their Notes into Common Stock pursuant to the Indenture. Any Notes as to which a
Purchase Notice has been validly delivered may be converted in accordance with
the terms of the Indenture only if the Purchase Notice has been validly
withdrawn before 11:59 p.m., New York City time, on the Expiration Date, as
described in Section 4 of this Company Notice.
2.4. Market for the Notes and our Common Stock.
There is no established reporting system or market for trading in the Notes. To
the extent that the Notes are traded, prices of the Notes may fluctuate widely
depending on trading volume, the balance between buy and sell orders, prevailing
interest rates, the market price of our Common Stock, our operating results and
the market for similar securities.
6
Our Common Stock, into which the Notes are convertible, is listed on the New
York Stock Exchange (the “NYSE”) under the symbol “IPG.” The following table
shows, for the periods indicated, the high and low closing sales prices per
share of our Common Stock as reported by the NYSE.
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High |
Low |
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2012: |
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First Quarter (through February 14, 2012) |
$ |
10.88 |
$ |
10.16 |
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2011: |
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Fourth Quarter |
$ |
9.92 |
$ |
6.95 |
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Third Quarter |
$ |
12.84 |
$ |
7.20 |
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Second Quarter |
$ |
12.63 |
$ |
11.15 |
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First Quarter |
$ |
13.20 |
$ |
10.47 |
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2010: |
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Fourth Quarter |
$ |
11.11 |
$ |
9.98 |
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Third Quarter |
$ |
10.17 |
$ |
6.93 |
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Second Quarter |
$ |
9.87 |
$ |
7.13 |
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|
First Quarter |
$ |
8.79 |
$ |
6.35 |
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On February 14, 2012, the closing sale price of our Common Stock, as reported
by the NYSE, was $10.70 per share.
We urge you to obtain current market information for the Notes, to the extent
available, and our Common Stock before making any decision whether to exercise
or refrain from exercising the Put Option.
2.5. Optional Redemption. Beginning on March 15,
2012, the Notes are redeemable for cash at any time at our option, in whole or
in part, at a redemption price equal to the principal amount of Notes to be
redeemed plus any accrued and unpaid interest (including any contingent
interest) up to, but excluding, the date fixed for redemption, as provided for
in the Indenture and the Notes. If we call the Notes for redemption, Holders may
convert Notes into Common Stock at any time prior to the close of business on
the Business Day prior to the Redemption Date in accordance with paragraph 9 of
the Notes.
2.6. Holder153s Right to Require Repurchase Upon Change in
Control. Each Holder may require us to repurchase all or any part
of his or her Notes if there is a Fundamental Change (as defined in the
Indenture) at a repurchase price equal to the Fundamental Change Purchase Price
(as defined in the Indenture).
2.7. Ranking. The Notes are our general unsecured
obligations and rank senior in right of payment to all our existing and future
indebtedness that is, by its terms, expressly subordinated in right of payment
to the Notes. The Notes rank equally in right of payment with all our existing
and future unsecured indebtedness that is not so subordinated. Because we are a
holding company, our rights and the rights of our creditors, including Holders
of the Notes, to participate in the assets of any subsidiary during its
liquidation or reorganization, are subject to the prior claims of the
subsidiary153s creditors, except to the extent that we are ourselves a creditor
with recognized claims against the subsidiary. On a consolidated basis, we had
$1,574.7 million of debt outstanding as of September 30, 2011, none of which was
secured or subordinated debt.
3. Procedures to Be Followed by Holders Electing to Exercise the Put
Option. Holders will not be entitled to receive the Purchase Price for
their Notes unless they (i) validly deliver and do not withdraw a Purchase
Notice before 11:59 p.m., New York City time, on the Expiration Date and (ii)
deliver the Notes for which they have delivered such Purchase Notice (together
with all necessary endorsements) to the Paying Agent or deliver such Notes to
the Paying Agent153s account at DTC prior to, on or after the Purchase Date. Only
registered Holders are authorized to deliver their Notes for purchase. Holders
may exercise the Put Option for some or all of their Notes; however, if Holders
wish to exercise the Put Option for a portion of their Notes, they must exercise
the Put Option for Notes in a principal amount of $1,000 or an integral multiple
thereof.
7
If Holders do not validly deliver a Purchase Notice, or if they withdraw a
validly delivered Purchase Notice, for their Notes before 11:59 p.m., New York
City time, on the Expiration Date, their Notes will not be purchased and will
remain outstanding subject to the existing terms of the Notes and the Indenture.
3.1. Method of Delivery. The method of delivery of
Notes, the related Purchase Notice and all other required documents, including
delivery and acceptance through DTC and DTC153s Automated Tender Offer Program
(“ATOP”), is at the election and risk of the person delivering such Notes,
Purchase Notice or other documents and, except as expressly otherwise provided
in the Purchase Notice, delivery will be deemed made only when actually received
by the Paying Agent. The date of any postmark or other indication of when a Note
or a Purchase Notice was sent will not be taken into account in determining
whether such materials were timely received. If such delivery is by mail, it is
suggested that Holders use properly insured, registered mail with return receipt
requested, and that Holders mail the Purchase Notice and other required
documents sufficiently in advance of the Expiration Date to permit timely
delivery to the Paying Agent.
3.2. Purchase Notice. To exercise the Put Option,
Holders of Notes must deliver to the Paying Agent the Purchase Notice at any
time from the opening of business on February 15, 2012 until 11:59 p.m., New
York City time, on the Expiration Date, and must not withdraw such notice.
Pursuant to the Indenture, the Purchase Notice must contain:
|
if certificated, the certificate number of the Notes being delivered for |
|
the portion of the principal amount of the Notes which will be delivered to |
|
a statement that such Notes shall be purchased as of the Purchase Date |
Enclosed with this Company Notice is the form of Purchase Notice that you are
required to use.
Holders who wish to exercise the Put Option without simultaneously delivering
their Notes to the Paying Agent must (i) properly complete and execute the
Purchase Notice, (ii) check the appropriate box in the section of the Purchase
Notice entitled “Method of Delivery” to indicate that Notes are not
simultaneously delivered to the Paying Agent and (iii) deliver the Purchase
Notice, together with any other required documents, to the Paying Agent before
11:59 p.m., New York City time, on the Expiration Date. Delivery of the Notes to
the Paying Agent or delivery of the Notes by book-entry transfer to the account
maintained by the Paying Agent with DTC is a condition to payment of the
Purchase Price to the Holder of such Notes.
HOLDERS WHO HOLD THEIR NOTES THROUGH DTC WHO WISH TO EXERCISE THE PUT
OPTION AND DELIVER THEIR NOTES TO THE PAYING AGENT NEED NOT SUBMIT A PHYSICAL
PURCHASE NOTICE TO THE PAYING AGENT IF SUCH HOLDERS TRANSMIT THEIR ACCEPTANCE
AND DELIVER THEIR NOTES ELECTRONICALLY THROUGH DTC153S ATOP SYSTEM, SUBJECT TO THE
TERMS AND PROCEDURES OF THAT SYSTEM. HOLDERS TRANSMITTING THEIR ACCEPTANCE AND
DELIVERING THEIR NOTES THROUGH DTC153S ATOP SYSTEM MUST ALLOW SUFFICIENT TIME FOR
COMPLETION OF THE ATOP PROCEDURES DURING THE NORMAL BUSINESS HOURS OF DTC.
Notes in Certificated Form. Holders whose Notes are held in
certificated form who wish to exercise the Put Option and simultaneously deliver
their Notes to the Paying Agent must properly complete and execute the Purchase
Notice and deliver such notice, together with the Notes (including all necessary
endorsements) and any other required documents, to the Paying Agent.
8
Notes in Global Form. Holders who are DTC participants who wish to
exercise the Put Option and deliver their Notes to the Paying Agent should
electronically transmit their acceptance through DTC153s ATOP system, subject to
the terms and procedures of that system. In transmitting its acceptance through
DTC153s ATOP system, a Holder acknowledges receipt of the Purchase Notice and
agrees to be bound by the terms set forth in the Purchase Notice.
Holders who are DTC participants may also elect to deliver a completed and
executed Purchase Notice, together with any other required documents, to the
Paying Agent and concurrently deliver their Notes by book-entry transfer to the
Paying Agent153s account at DTC.
Notes Held Through a Custodian. Holders whose Notes are held by a
broker, dealer, commercial bank, trust company or other nominee must contact
such nominee if such Holders desire to exercise the Put Option and instruct such
nominee to exercise the Put Option on the Holders153 behalf by following the
procedures described in this Company Notice.
3.3. Delivery of Notes. To receive the Purchase
Price, Holders must deliver the Notes (together with all necessary endorsements)
to the Paying Agent or deliver such Notes by book-entry transfer to the Paying
Agent153s account at DTC prior to, on or after the Purchase Date. Delivery of the
Notes to the Paying Agent or delivery of the Notes by book-entry transfer to the
account maintained by the Paying Agent with DTC is a condition to the payment of
the Purchase Price to the Holder of such Notes.
HOLDERS WHO HOLD THEIR NOTES THROUGH DTC NEED NOT DELIVER PHYSICAL
NOTE CERTIFICATES TO THE PAYING AGENT IF SUCH HOLDERS COMPLY WITH THE DELIVERY
PROCEDURES OF DTC.
Notes must be delivered to the Paying Agent or delivered by book-entry
transfer to the Paying Agent153s account at DTC to collect payment of the Purchase
Price. Delivery of Notes to DTC or to us does not constitute delivery to the
Paying Agent. Payment of the Purchase Price is subject to the Notes being
delivered to the Paying Agent conforming in all respects to the description
thereof in the related Purchase Notice.
Under no circumstances will Notes accrue interest by reason of any delay in
making payment to any person who delivers Notes after the Purchase Date. The
Purchase Price for Notes delivered after the Purchase Date will be the same as
that for Notes delivered prior to or on the Purchase Date. If the Paying Agent
holds, in accordance with the terms of the Indenture, sufficient cash to pay the
Purchase Price for the Notes on the Business Day following the Purchase Date,
then, on and after such date, such Notes will cease to be outstanding and
interest (including contingent interest) on such Notes will cease to accrue,
whether or not the Notes are delivered to the Paying Agent or delivered by
book-entry transfer to the account maintained by the Paying Agent with DTC, and
all rights (other than the right to receive the Purchase Price upon delivery of
the Notes) of the Holder of such Notes will terminate.
4. Right of Withdrawal. A Purchase Notice may be withdrawn,
for some or all of the Notes for which such Purchase Notice has been delivered,
at any time before 11:59 p.m., New York City time, on the Expiration Date. In
order to withdraw a Purchase Notice, Holders must deliver to the Paying Agent
written notice, substantially in the form enclosed herewith, containing:
|
if certificated, the certificate number of the Notes with respect to which |
|
the principal amount of the Notes with respect to which such notice of |
|
the principal amount, if any, of such Notes which remain subject to the |
9
The signature on the notice of withdrawal must be guaranteed by an eligible
guarantor institution (as defined in Rule 17Ad-15 under the Securities Exchange
Act of 1934, as amended (the “Exchange Act”)) if certificates have been
delivered or otherwise identified to the Paying Agent. A properly withdrawn
Purchase Notice will be deemed not to have been validly delivered for purposes
of the Put Option. The Put Option for Notes for which a Purchase Notice has been
withdrawn may be re-exercised by following the delivery procedures described in
Section 3 before 11:59 p.m., New York City time, on the Expiration Date.
Enclosed with this Company Notice is a Notice of Withdrawal that may be used for
withdrawing a Purchase Notice.
HOLDERS WHO EXERCISED THE PUT OPTION AND DELIVERED THEIR NOTES TO THE
PAYING AGENT THROUGH DTC153S ATOP SYSTEM SHOULD ELECTRONICALLY TRANSMIT THEIR
WITHDRAWAL THROUGH DTC153S ATOP SYSTEM, SUBJECT TO THE TERMS AND PROCEDURES OF
THAT SYSTEM. HOLDERS TRANSMITTING THEIR WITHDRAWAL THROUGH DTC153S ATOP SYSTEM
MUST ALLOW SUFFICIENT TIME FOR COMPLETION OF THE ATOP PROCEDURES DURING THE
NORMAL BUSINESS HOURS OF DTC.
Holders may withdraw any Notes previously delivered to the Paying Agent and
not yet accepted for payment after the expiration of 40 business days from the
date of this Company Notice.
5. Payment for Notes. At or before 10:00 a.m., New York City
time, on March 15, 2012, we will deposit with the Paying Agent the appropriate
amount of cash required to pay the Purchase Price for the Notes for which a
Purchase Notice has been validly delivered and not withdrawn by 11:59 p.m., New
York City time, on the Expiration Date, and the Paying Agent will promptly
distribute the cash to each Holder that has validly delivered its Notes to the
Paying Agent or validly delivered such Notes to the Paying Agent153s account at
DTC prior to or on the Purchase Date.
The total amount of funds required by us to purchase all of the Notes is
$400.0 million (assuming the Put Option is validly exercised for all of the
Notes and all of the Notes are validly delivered and accepted for payment). In
the event the Put Option is exercised for any Notes and any Notes are validly
delivered and accepted for payment, we intend to use cash on hand. We do not
have any alternative financing plans.
6. Notes Acquired. Any Notes purchased by us pursuant to the
Put Option will be cancelled by the Trustee, pursuant to the terms of the
Indenture.
7. Plans or Proposals of the Company. Except as described in
these materials or in our filings with the Securities and Exchange Commission
(the “SEC”) or as previously publicly announced, we currently have no
agreements, nor have we authorized any actions, which would be material to a
Holder153s decision to exercise the Put Option, which relate to or which would
result in:
|
any extraordinary transaction, such as a merger, reorganization or |
|
any purchase, sale or transfer of a material amount of our assets or any of |
|
any material change in our present dividend rate or policy, indebtedness or |
|
any change in our present Board of Directors or management, including, but |
|
any other material change in our corporate structure or business; |
|
any class of our equity securities to be delisted from a national securities |
|
any class of our equity securities becoming eligible for termination of |
10
|
the suspension of our obligation to file reports under Section 15(d) of the |
|
the acquisition by any person of additional securities of ours, or the |
|
any changes in our charter, bylaws or other governing instruments, or other |
8. Interests of Directors, Executive Officers and Affiliates of the
Company in the Notes. Neither we nor, to our knowledge after making
reasonable inquiry, any of our executive officers or directors or any
“associate” or subsidiary of any such person, has any beneficial interest in the
Notes, or has engaged in any transaction in the Notes during the 60 days
preceding the date of this Company Notice. A list of our executive officers and
directors is attached to this Company Notice as Schedule A. The term
“associate” is used as defined in Rule 12b-2 under the Exchange Act.
Certain of our directors and executive officers are participants in ordinary
course equity compensation plans and arrangements involving our Common Stock, as
disclosed by us prior to the date hereof. We are party to a 10b5-1 plan with
HSBC Securities (USA) Inc. under which it will repurchase our Common Stock for
our account up to a daily limit from February 14 to February 27, 2012. We also
hold capped call options to hedge the risk of price appreciation on the shares
of our common stock into which our 4.75% Convertible Senior Notes due 2023 are
convertible. The options give us the right to purchase up to 16.5 million shares
of our common stock at a strike price of $12.13 per share, except that the
economic value of the net proceeds of exercising the options will not exceed the
difference between the strike price and the cap price of $17.83. Subject to
certain limitations, we may elect settlement of the options to occur in cash or
in shares. The options will expire on April 2, 2013. Except as described in this
paragraph, neither we nor, to our knowledge after making reasonable inquiry, any
of our executive officers or directors, is a party to any contract, arrangement,
understanding or agreement with any other person relating, directly or
indirectly, to the Put Option or with respect to any of our securities,
including, but not limited to, any contract, arrangement, understanding or
agreement concerning the transfer or the voting of the securities, joint
ventures, loan or option arrangements, puts or calls, guarantees of loans,
guarantees against loss or the giving or withholding of proxies, consents or
authorizations.
9. Legal Matters; Regulatory Approvals. We are not aware of
any license or regulatory permit that is material to our business that might be
adversely affected by the Put Option, or of any approval or other action by any
government or regulatory authority or agency that is required for the
acquisition of the Notes as described in this Company Notice. Should any
approval or other action be required, we presently intend to seek the approval
or take the action. However, we cannot assure you that we would be able to
obtain any required approval or take any other required action.
10. Purchases of Notes by the Company and Its Affiliates.
During the 60 days preceding the date of this Company Notice, the Company has
made no purchases of the Notes.
Effective on the date of this Company Notice, we and our affiliates,
including their executive officers and directors, are prohibited under
applicable United States federal securities laws from purchasing Notes (or the
right to purchase Notes) other than through the Put Option until at least the
tenth business day after the Purchase Date. The federal securities laws do not
prohibit us from exercising our right to redeem Notes pursuant to the terms of
the Indenture. Following such time, if any Notes remain outstanding, we and our
affiliates may purchase Notes in the open market, in private transactions,
through a subsequent tender offer, or otherwise, any of which may be consummated
at purchase prices higher or lower than the Purchase Price. Any decision to
purchase Notes after the Purchase Date, if any, will depend upon many factors,
including the market price of the Notes, the amount of Notes delivered for
purchase pursuant to the Put Option, the market price of our Common Stock, our
business and financial position, and general economic and market conditions.
11
11. Material United States Income Tax Considerations.
The following discussion summarizes the material United States federal income
tax considerations that may be relevant to you if you exercise the Put Option.
This summary is based on the Internal Revenue Code of 1986, as amended, and the
regulations, rulings and decisions thereunder, all of which are subject to
change, possibly with retroactive effect.
This summary does not describe all of the tax considerations that may be
relevant to you. All Holders are strongly encouraged to consult with their tax
advisor about the United States federal, state, local, foreign and other tax
consequences of exercising the Put Option.
U.S. Holders. This discussion deals only with U.S. Holders (as
defined below) who are beneficial owners of the Notes holding the Notes as
capital assets, and does not apply if you are a member of a class of Holders
subject to special rules, including, but not limited to: a dealer in Notes or
currencies; a trader in Notes who elects to use a mark-to-market method of
accounting for your Notes holdings; a bank or financial institution; an
insurance company; a tax-exempt organization; a person owning Notes that are a
hedge or that are hedged against interest rate risks; a partnership or person
treated as a partnership for United States federal income tax purposes, or a
partner thereof; a regulated investment company or real estate investment trust;
a person owning Notes as part of a straddle or conversion transaction for tax
purposes; a United States person whose functional currency for tax purposes is
not the U.S. dollar; or a United States expatriate. You will be a U.S. Holder if
you are a beneficial owner of the Notes for United States federal income tax
purposes and you are: (i) a citizen or resident of the United States; (ii) a
domestic corporation or other entity treated as such for United States federal
income tax purposes; (iii) an estate whose income is subject to United States
federal income taxation regardless of its source; or (iv) a trust if a United
States court is able to exercise primary supervision over the trust153s
administration and one or more United States persons can control all substantial
decisions of the trust.
Subject to the discussion of the market discount rules set forth below, your
exercise of the Put Option will result in taxable gain or loss to you equal to
the difference between (i) the amount of cash received (other than amounts
attributable to accrued interest, which will be treated as an actual payment of
interest on the Notes) and (ii) your adjusted tax basis in the Notes
surrendered. If you obtained your Notes in exchange for the Company153s 4.50%
Convertible Senior Notes due 2023 (the “Old Notes”), your adjusted tax basis in
the Notes generally should equal your adjusted tax basis in the Old Notes at the
time of the exchange, increased by any gain and decreased by any loss you
recognized in the exchange and further reduced by any amortized premium. If you
obtained your Notes in exchange for cash, your adjusted tax basis will generally
equal the amount paid for the Notes, increased by any amount of market discount
previously taken into account and reduced by any amortizable bond premium
previously amortized. Any such gain or loss will be long-term capital gain or
loss if your holding period in the Notes on the date you exercise the Put Option
is more than one year. The deductibility of net capital losses by individuals
and corporations is subject to limitations.
Market discount is the excess, if any, of the principal amount of a Note over
your tax basis in the Note at the time of the acquisition, unless the excess is
less than a specified de minimis amount, in which case market discount is
considered zero. In general, if you acquired the Notes with market discount, any
gain you realize on your exercise of the Put Option will result in ordinary
income to the extent of the portion of the market discount that has accrued
while you held the Notes, unless you elected to include market discount in
income currently as it accrued.
Non-U.S. Holders. A non-U.S. Holder is any Holder that is not a U.S.
Holder, as defined above. A non-U.S. Holder generally will not be subject to
United States federal income tax or withholding tax on any gain realized on the
receipt of cash in exchange for Notes pursuant to the Put Option unless the gain
is effectively connected with a trade or business of the non-U.S. Holder in the
United States and, where a tax treaty applies, is attributable to a United
States permanent establishment maintained by the Holder, or you are an
individual non-U.S. Holder who is present in the United States for more than 183
days in the taxable year during which you exercise the Put Option and certain
other conditions are met.
12
If a non-U.S. Holder is engaged in a trade or business in the United States
and the Holder153s investment in the Notes is effectively connected with such
trade or business, the Holder will be subject to regular United States federal
income tax on a net income basis on any gain recognized upon a sale of the Notes
pursuant to the Put Option in the same manner as if the Holder were a U.S.
Holder.
Backup Withholding. A U.S. Holder may be subject to backup
withholding with respect to payments made pursuant to the Put Option unless such
U.S. Holder (i) is a corporation or comes within certain other exempt categories
and demonstrates this fact, or (ii) provides a correct taxpayer identification
number, certifies as to no loss of exemption from backup withholding and
otherwise complies with applicable requirements of the backup withholding rules.
The amount of any backup withholding will be allowed as a credit against such
U.S. Holder153s United States federal income tax liability and may entitle such
U.S. Holder to a refund, provided that the required information is furnished to
the IRS. Information reporting, and possibly backup withholding, may apply if
the Notes are held by a non-U.S. Holder through a U.S. broker or financial
institution or the U.S. office of a non-U.S. broker or financial institution and
the non-U.S. Holder fails to provide appropriate information (on Form W-8BEN or
other applicable form). Non-U.S. Holders should consult their tax advisors with
respect to the application of U.S. information reporting and backup withholding
rules to the disposition of Notes pursuant to the Put Option.
All descriptions of tax considerations are for Holders153 guidance only
and are not tax advice. We recommend that Holders consult with their tax and
financial advisors with respect to the tax consequences of exercising the Put
Option, including the applicability and effect of state, local and foreign tax
laws, before exercising the Put Option for any of their Notes.
12. Additional Information. This Company Notice is part of a
Tender Offer Statement on Schedule TO that we have filed with the SEC. This
Company Notice does not contain all of the information contained in the Schedule
TO and the exhibits to the Schedule TO. We recommend that you review the
Schedule TO, including its exhibits, and the following materials that we have
filed with the SEC before making a decision as to whether to exercise or refrain
from exercising the Put Option:
|
1. |
Our annual report on Form 10-K for the year ended December 31, 2010; |
|
2. |
Our quarterly reports on Form 10-Q for the quarters ended March 31, 2011, |
|
3. |
Our current reports on Form 8-K filed February 22, 2011, March 25, 2011, |
|
4. |
All documents filed by us with the SEC pursuant to Sections 13(a), 13(c), 14 |
We expect to file our annual report on Form 10-K for the year ended December
31, 2011 on or before February 29, 2012. The SEC file number for these filings
is 001-06686. These filings, our other annual, quarterly and current reports,
our proxy statements and our other SEC filings may be examined, and copies may
be obtained, at the SEC153s public reference room at 100 F Street N.E.,
Washington, D.C. 20549. You may obtain information on the operation of the
public reference room by calling the SEC at 1-800-SEC-0330. Our SEC filings are
also available to the public on the SEC153s Internet site at www.sec.gov.
Each person to whom a copy of this Company Notice is delivered may obtain a
copy of any or all of the documents to which we have referred you, other than
exhibits to such documents, unless such exhibits are specifically incorporated
by reference into such documents, at no cost, by writing or calling us at 1114
Avenue of the Americas, New York, New York, 10036, Attention: Nicholas J.
Camera, Secretary, (212) 704-1200.
13
As you read the documents listed above, you may find some inconsistencies in
information from one document to another. If you find inconsistencies between
the documents, or between a document and this Company Notice, you should rely on
the statements made in the most recent document.
In making your decision as to whether to exercise the Put Option, you should
read the information about us contained in this Company Notice together with the
information contained in the documents to which we have referred you.
13. No Solicitations. We have not employed or retained any
persons to make solicitations or recommendations in connection with the Put
Option. We have retained Global Bondholder Services Corporation (“GBSC”) to
assist us in the distribution of this Company Notice and the related notice
materials to Holders of the Notes and to brokers, dealers, commercial banks and
other nominees of Holders. We will pay GBSC reasonable and customary
compensation for its services in connection with the Put Option, plus
reimbursement for out-of-pocket expenses. We have also agreed to indemnify GBSC
against certain liabilities, including liabilities arising under the federal
securities laws.
14. Definitions. All capitalized terms used but not
specifically defined herein shall have the meanings given to such terms in the
Indenture.
15. Conflicts. In the event of any conflict between this
Company Notice and the accompanying Purchase Notice on the one hand and the
terms of the Indenture or any applicable laws on the other hand, the terms of
the Indenture or applicable laws, as the case may be, will control.
None of us, our Board of Directors or our employees is making any
recommendation to any Holder as to whether to exercise or refrain from
exercising the Put Option. Each Holder must make his or her own decision whether
to exercise the Put Option and, if so, the principal amount of Notes for which
to exercise the Put Option based on his or her own assessment of current market
value and other relevant factors.
THE INTERPUBLIC GROUP OF COMPANIES, INC.
14
SCHEDULE A
INFORMATION ABOUT THE EXECUTIVE OFFICERS
AND DIRECTORS OF THE COMPANY
The table below sets forth information about our executive officers and
directors as of February 14, 2012. To the best of our knowledge after making
reasonable inquiry, none of our executive officers or directors has beneficial
ownership in the Notes.
|
Name |
Position |
|
|
Michael I. Roth |
Chairman of the Board and Chief Executive Officer |
|
|
Nicolas Brien |
Chairman and Chief Executive Officer of McCann Worldgroup |
|
|
Nicholas J. Camera |
Senior Vice President, General Counsel and Secretary |
|
|
Christopher F. Carroll |
Senior Vice President, Controller and Chief Accounting Officer |
|
|
Julie M. Conners |
Senior Vice President, Audit and Chief Risk Officer |
|
|
Philippe Krakowsky |
Executive Vice President, Chief Strategy and Talent Officer |
|
|
Frank Mergenthaler |
Executive Vice President and Chief Financial Officer |
|
|
Reginald K. Brack |
Director |
|
|
Jocelyn Carter-Miller |
Director |
|
|
Jill M. Considine |
Director |
|
|
Richard A. Goldstein |
Director |
|
|
H. John Greeniaus |
Director |
|
|
Mary J. Steele Guilfoile |
Director |
|
|
Dawn Hudson |
Director |
|
|
William T. Kerr |
Director |
|
|
David M. Thomas |
Director |
The business address and telephone number of each executive officer and
director is c/o The Interpublic Group of Companies, Inc., Attention: Nicholas J.
Camera, 1114 Avenue of the Americas, New York, New York, 10036, (212) 704-1200.
A-1
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