The Media Financial Management Association (MFM) and its BCCA subsidiary have learned that a letter agreement is being sent by BBDO to vendors with reference to a Supplier Purchase Agreement (SPA) among BBDO, Chrysler Receivables, and Citibank. The terms of this letter agreement cover a vendor’s current Chrysler receivables with BBDO, but also all prior and future receivables from BBDO or any of its affiliates relating to Chrysler or otherwise. BBDO is a part of the Omnicom Group which includes, among others, OMD, PHD and Prometheus.
Said MFM/BCCA: “The letter includes a clause which purports to make the agreement binding on all subsidiaries of any Vendor which signs it. Execution of the letter with this language by one location could therefore bind all other company locations.
We cannot advise you what action(s) to take if you receive such a letter. Each vendor must determine independently what action it will take. We encourage you, however, to discuss this and all other agreements with legal counsel before determining your appropriate response.”
