|INTERPUBLIC GROUP OF COMPANIES, INC. filed this Form 10-Q on 10/26/2017|
PART II – OTHER INFORMATION
Information about our legal proceedings is set forth in Note 12 to the unaudited Consolidated Financial Statements included in this Quarterly Report on Form 10-Q.
In the third quarter of 2017, there have been no material changes in the risk factors we have previously disclosed in Item 1A, Risk Factors, in our 2016 Annual Report on Form 10-K.
Unregistered Sales of Equity Securities and Use of Proceeds
The following table provides information regarding our purchases of our equity securities during the period from July 1, 2017 to September 30, 2017:
Total Number of
Shares (or Units)
Average Price Paid
per Share (or Unit) 2
Total Number of Shares (or Units) Purchased as Part of
Plans or Programs 3
Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs 3
July 1 - 31
August 1 - 31
September 1 - 30
Included shares of our common stock, par value $0.10 per share, withheld under the terms of grants under employee stock-based compensation plans to offset tax withholding obligations that arose upon vesting and release of restricted shares (the “Withheld Shares”). We repurchased 11,734 Withheld Shares in July 2017, 1,969 Withheld Shares in August 2017 and no Withheld Shares in September 2017, for a total of 13,703 Withheld Shares during the three-month period.
The average price per share for each of the months in the fiscal quarter and for the three month period was calculated by dividing (a) the sum for the applicable period of the aggregate value of the tax withholding obligations and the aggregate amount we paid for shares acquired under our share repurchase programs, described in Note 5 to the unaudited Consolidated Financial Statements, by (b) the sum of the number of Withheld Shares and the number of shares acquired in our share repurchase programs.
On February 10, 2017, we announced that our Board of Directors had approved a new share repurchase program to repurchase from time to time up to $300.0 million of our common stock, in addition to amounts available on existing authorizations. There is no expiration date associated with the share repurchase programs.
(a) On October 25, 2017, The Interpublic Group of Companies, Inc. (the “Company”) entered into an amendment and restatement (the “Amendment”) of the Company’s credit agreement originally dated as of July 18, 2008, as amended and restated as of April 23, 2010, as further amended and restated as of May 31, 2011, as further amended as of November 6, 2012, as further amended and restated as of December 12, 2013 and as further amended and restated as of October 20, 2015 (as further amended and restated pursuant to the Amendment, the “Credit Agreement”). Under the Amendment, among other things, the revolving commitments under the Credit Agreement have been increased from $1 billion to $1.5 billion, and the maturity date was extended to October 25, 2022. The Company continues to have the ability to increase the commitments under the Credit Agreement from time to time by an additional amount of up to $250 million, provided the Company receives commitments for such increases and satisfies certain other conditions.
The cost structure under the Amendment has not changed. Based on the Company’s current credit ratings, the applicable margin for Eurocurrency Rate borrowings (as defined in the Credit Agreement) is 1.100%, and the facility fee payable on a lender’s revolving commitment is 0.150%.
In addition to other usual and customary covenants, the Credit Agreement contains two financial covenants, both of which remain the same. Under the Credit Agreement, the Company is required to maintain, as of the end of each fiscal quarter: (i) an interest coverage ratio of not less than 5.00 to 1.00 for the period of four fiscal quarters then ended; and (ii) a leverage ratio of not more than 3.50 to 1.00 for the period of four fiscal quarters then ended. The leverage ratio may be changed to not more than 4.00