Exhibit 10.1
MEMORANDUM OF UNDERSTANDING, dated March 7, 2002, between DENTSU INC.,
a company organized under the laws of Japan ("Dentsu"), and MADAME XXXXXXXXX
XXXXXXXX, a French national (acting for herself and her successors, together
designated hereafter as "Madame EB"):
WHEREAS, Madame EB, directly, and indirectly through Societe Anonyme
Somarel ("Somarel"), is the controlling shareholder of Publicis Groupe S.A., a
SOCIETE ANONYME organized under the laws of the Republic of France ("Publicis");
WHEREAS, Publicis has entered into an Agreement and Plan of Merger (the
"Merger Agreement") with B|Com3 Group, Inc., a corporation organized under the
laws of Delaware ("B|Com3"), and a wholly-owned Delaware subsidiary of Publicis
(the "Acquisition Company"), providing among other things for the merger (the
"Merger") of B|Com3 into the Acquisition Company;
WHEREAS, Dentsu is supportive of the Merger and has agreed, pursuant to
a support agreement dated this date (the "Support Agreement") among Publicis,
Acquisition Company, and Dentsu, to vote, subject to the conditions set forth
therein, the B|Com3 Shares (defined below) owned by it in favor of the Merger,
and Dentsu intends to enter into other transactions related thereto, subject,
however, to Dentsu's being able to equity account as of the effective date of
the Merger for its resulting investment in Publicis;
WHEREAS, Dentsu is the holder of 4,284,873 shares of the Class B Common
Stock of B|Com3 ("B|Com3 Shares") and, upon the consummation of the Merger, will
become the owner of ordinary shares (ACTIONS ORDINAIRES) of Publicis ("Dentsu
Publicis Shares") representing in the aggregate not less than 15% of the voting
power of Publicis;
WHEREAS, Dentsu has entered into a Memorandum of Understanding, dated
this date, with Publicis providing for certain shareholder rights and
obligations for Dentsu as a shareholder of Publicis (the "Publicis MOU"), a
complete and correct copy of which is attached hereto as Exhibit A;
WHEREAS, Dentsu has entered into a Memorandum of Understanding, dated
this date, with Publicis providing for, among other things, a strategic alliance
between Dentsu and Publicis (the "Support Agreement MOU"); and
WHEREAS, Madame EB (or her successors) owns directly approximately
5.556% of the share capital (8.930% of the voting rights) of Publicis and
approximately 51.29% of Somarel, which in turn owns approximately 22.149% of the
share capital (35.594% of the voting rights) of Publicis;
THE PARTIES HERETO desiring to be bound have agreed as follows:
1. Dentsu acknowledges that (i) Publicis was founded by Xxxxxx
Xxxxxxxxx-Xxxxxxxx, (ii) Madame EB is the daughter of such founder, (iii)
Publicis is a French company with French roots, the domicile and headquarters of
which are in Paris, France, and it is intended that it will so remain, and (iv)
the leadership of Publicis is French and it is intended that any change will
only be made with the agreement of Madame EB.
2. Dentsu will vote the Dentsu Publicis Shares and Madame EB will vote
or cause to be voted the EB Shares (in each case being defined for this purpose
as the shares of Publicis that Dentsu or Madame EB (whether directly or
indirectly through Somarel), respectively, then owns) in the following manner:
(a) Dentsu will vote and will cause its representatives on the
Supervisory Board of Publicis (the "Supervisory Board") to vote, unless
such vote would expose such representatives of Dentsu to legal
liability:
(i) to elect Madame EB (or any person designated by
Madame EB) chairperson (PRESIDENTE or PRESIDENT, as the case
may be) of the Supervisory Board, and to maintain her or such
person in office;
(ii) to elect to the Supervisory Board and maintain
in office such persons designated by her; and
(iii) in favor of appointments of or changes in the
members of management (including at the DIRECTOIRE) of
Publicis proposed by Madame EB, provided that Madame EB shall
have consulted Dentsu on such appointments or changes.
3. A special committee of the Supervisory Board (the "Committee") shall
be created comprised of members appointed by Madame EB and members appointed by
Dentsu (e.g. 2 or 3 by Madame EB, 1 or 2 by Dentsu) and members appointed by the
management of Publicis equal in number to the number of Dentsu's
representatives, provided that Madame EB shall appoint a majority of the members
of the Committee. The Committee shall examine all strategic decisions and
determine the vote on matters on which Dentsu has agreed to vote as directed by
EB pursuant to Section 5(a) below. The Committee shall act, after consultation,
by consensus of its members, or, in the absence of consensus, by a simple
majority vote.
4. So long as Dentsu owns, directly or indirectly, not less than 10% of
the outstanding ordinary shares of Publicis (taking into account for this
purpose only diminutions in Dentsu's ownership by reason of any transfer of
Publicis shares or any failure by Dentsu to exercise its preemptive rights
(DROITS PREFERENTIELS DE SOUSCRIPTION), or any rights of Dentsu that would
entitle it to subscribe to shares on the same terms and in the same quantity as
if it were exercising such preemptive rights), Madame EB and Somarel will vote,
and Madame EB shall cause Somarel to vote, the EB Shares to elect
2
and maintain in office two members of the Supervisory Board chosen from among
candidates designated by Dentsu or their respective replacements designated by
Dentsu (one of such designees to be a representative director of Dentsu),
provided that if Madame EB establishes at the time of such election that any
such designee (other than such representative director) lacks reasonably
appropriate qualifications to serve as a member of the Supervisory Board, Dentsu
shall be entitled to designate a different person for election to the
Supervisory Board. If the size of the Supervisory Board is increased, the number
of members that Dentsu may appoint will be increased so that Dentsu will be
entitled to appoint a number of members of the Supervisory Board that is
proportionate to its voting power in Publicis (rounding up to the nearest whole
number).
5. Dentsu shall vote its shares of Publicis at any such shareholders'
meeting in its own discretion, except only as set forth below in clause (a) and
(c) of this Section 5.
(a) After due consultation between Dentsu and Madame EB,
Dentsu will vote its Publicis shares as directed by Madame EB on the
following matters:
(i) decisions to amend Publicis' charter to change
Publicis' name or headquarters, the number of members of the
Supervisory Board or the Management Board (DIRECTOIRE), the
duration of the terms in office of any such members, and the
number of qualifying shares of Publicis required to be owned
by any such member;
(ii) any merger, consolidation or similar business
combination of Publicis with or into any other company as a
result of which those shareholders who were shareholders of
Publicis immediately prior to such business combination shall
have a majority of the outstanding votes and common equity
interest of the surviving entity in such business combination,
provided that, Dentsu will vote in any event its Publicis
shares as directed by EB with respect to any merger of Somarel
and/or the management companies holding certain Somarel
shares, with and into Publicis; and
(iii) declaration of dividends, so long as EB directs
Dentsu to vote in favor of reasonable dividends that do not
exceed 40% of Publicis' distributable profits for the
applicable fiscal year;
(iv) capital increases of less than 10% of the share
capital or the voting rights of Publicis where Dentsu is
entitled to subscribe by using preemptive rights (DROIT
PREFERENTIAL DE PREEMPTION), PROVIDED that the capital
increases with respect to which Madame EB may direct Denver
will not exceed in the aggregate 10% of the capital of
Publicis as constituted on the date hereof; and
3
(v) reductions of share capital of Publicis resulting
from cancellation of shares pursuant to Publicis' stock
repurchase program.
(b) After due consultation between Dentsu and Madame EB,
Dentsu will vote its Publicis shares as it shall determine on each of
the following:
(i) decisions to issue securities giving right to
more than 10% of the share capital or of the voting rights of
Publicis;
(ii) rights offerings without right to subscribe to,
or participate in, such offering;
(iii) reserved capital increases to identified
parties;
(iv) public offer by Publicis of its securities with
suppression of the preferential rights of existing
shareholders to subscribe, unless Dentsu has the right to
participate in such offer in proportion to its ownership of
Publicis;
(v) decisions to contribute or transfer assets to a
third party, to the extent such decision is put to the
shareholders; and
(vi) decisions to approve any related party
transaction involving EB or Dentsu or any other affiliate of
Publicis.
(c) In the event that members of the Supervisory Board
designated by Dentsu are members of the audit committee of the
Supervisory Board, and (x) the statutory auditors of Publicis
(COMMISSAIRES AUX Comptes) present accounts certified by them, (y) any
objections to such accounts raised by such Dentsu members of the audit
committee are considered by such statutory auditors and answered by
them, and (z) such statutory auditors maintain their certification of
such accounts, then Dentsu shall vote at the shareholders' meeting in
favor of the acceptance of such accounts.
6. Until July 12, 2012 (the "Expiration Date"), Dentsu shall not pledge
or transfer any shares of Publicis owned by Dentsu to any third party, except to
comply with Dentsu's obligations under Section 8.
7. From the Expiration Date, Dentsu may transfer all or any portion of
the Publicis shares held by it without restriction, subject to the following:
(a) If Dentsu shall receive from a third party an offer (an
"Offer") to purchase any Publicis shares (the "Offered Shares") for
cash, Dentsu shall make a written offer for the sale of such shares to
Madame EB at the same price and on the same terms as have been offered
by the third party (the "Offered Price"), by
4
notice to Madame EB and Publicis' management board (DIRECTOIRE),
setting forth the identity of such prospective third-party purchaser
and attaching a copy of such offer and providing such further
information relating to such offer as Madame EB may reasonably request.
Madame EB shall have 45 days from the date the Offer is given in which
to notify Dentsu in writing whether she, or her designee, elects to
purchase all but not part of the Offered Shares set forth in such Offer
(provided that such 45-day period may be reduced in the EB
Shareholders' Agreement referred to below with respect to sales of
small amounts of shares). If Madame EB or her designee elects to
purchase the Offered Shares, Dentsu shall be bound to transfer to such
person, and such person shall be bound to purchase, the Offered Shares,
upon the terms set forth in the Offer within 20 days of the date of
expiration of the 45-day period, by payment of cash in the amount of
the Offered Price for such Offered Shares against delivery by Dentsu of
all documents necessary to transfer such Offered Shares. If Madame EB
or her designee does not elect to purchase all of the Offered Shares in
accordance with the foregoing or fails to consummate the purchase
within such 20-day period, Dentsu shall be free to sell and transfer
such Offered Shares without restriction, provided that if such sale and
transfer of the Offered Shares is not consummated within 180 days of
the expiration of such 45-day period (if Madame EB fails to notify
Dentsu of an election to purchase the Offered Shares) or the expiration
of such 20-day period (if Madame EB notifies Dentsu in a timely manner
of an election to purchase the Offered Shares, but fails to consummate
the purchase), as the case may be, then any transfer by Dentsu of the
Offered Shares shall be once again subject to the requirements of this
Section 7(a).
(b) If Dentsu wishes to sell any Publicis shares on the open
market or to an underwriter or in another organized selling effort
(such as a bookbuilding or a secondary offering), Dentsu shall notify
Madame EB thereof by delivery of a written notice (an "RFO Offer
Notice") stating: (i) the number of Publicis shares proposed to be
transferred (the "Sale Shares"); (ii) the proposed price (the "RFO
Offer Consideration"); and (iii) an offer to Madame EB to sell to her
the Sale Shares at the RFO Offer Consideration. Madame EB will have 30
days from the date the RFO Offer Notice is given in which to notify
Dentsu whether she, or her designee, elects to purchase all but not
part of the Sale Shares on the terms stated in such RFO Offer Notice.
If Madame EB or her designee elects to purchase all but not part of the
Sale Shares, she or her designee shall consummate the purchase of such
Sale Shares not later than 20 days from the date of such election by
payment of cash in the amount of the RFO Offer Consideration for such
Sale Shares against delivery by Dentsu of all documents necessary to
transfer such Sale Shares. If Madame EB or her designee does not elect
to purchase all of the Sale Shares or fails to consummate the purchase
within such 20-day period, then Dentsu may sell and transfer all of the
Sale Shares to any other person without restriction for cash at a price
equal to or greater than the RFO Offered
5
Consideration, provided that if Dentsu (x) does not accept an offer
from any such other person to purchase the Sale Shares within 30
Business Days of the expiration of the 30-day period specified above
(if Madame EB fails to notify Dentsu of an election to purchase the
Sale Shares) or the expiration of the 20-day period specified above (if
Madame EB notifies Dentsu in a timely manner of an election to purchase
the Sale Shares, but fails to consummate the purchase), as the case may
be, or (y) if Dentsu does accept such an offer from any such other
person within such 30 Business Day period but does not consummate the
sale and transfer of the Sale Shares to such other person by the
sixtieth day following such thirtieth Business Day, then any transfer
by Dentsu of the Sale Shares shall once again be subject to the
requirements of this Section 7(b). For purposes of the preceding
sentence, "Business Day" shall mean any day, other than a Saturday,
Sunday or other day on which the Paris Stock Exchange is closed.
8. Until the Expiration Date, Dentsu shall be prohibited to own, alone
or in concert, at any time more than a number of Publicis Shares that entitles
it to 15% of the voting power of Publicis (such level of ownership, the
"Permitted Level"), except as may be otherwise agreed with Publicis in the
Publicis Shareholders' Agreement referred to in the Publicis MOU, PROVIDED that
no ORAs (or ordinary shares issuable in respect thereof) or warrants attached to
the OBSAs, such instruments being referred to in the Merger Agreement (or
ordinary shares issuable in respect of such warrants) issued in connection with
the Merger shall be taken into account for the purpose of determining whether
the Permitted Level had been exceeded by Dentsu, PROVIDED, FURTHER that Dentsu
shall not be deemed to have violated the foregoing prohibition (i) if Dentsu
inadvertently or unintentionally exceeds the Permitted Level and, upon notice
thereof from Publicis or Madame EB, Dentsu promptly reduces its ownership of
shares of Publicis to the Permitted Level, or (ii) to the extent Dentsu exceeds
the Permitted Level as a result of any repurchase of shares or other reduction
of capital by Publicis, and PROVIDED, further, that if Dentsu exceeds the
Permitted Level for any reason, Dentsu will not vote at any shareholders'
meeting of Publicis such number of shares of Publicis owned by Dentsu that
represents voting power in excess of 15% of the voting power of Publicis.
9. Denver will not conclude any agreement concerning the direction and
management of Philadelphia with any third party without the written permission
of Madame EB. Without Dentsu's written permission, Madame EB will not conclude
any agreement concerning the direction and management of Philadelphia with any
third party that would result in Dentsu's being required to join in making a
tender offer for Publicis. In case of a violation by Madam EB of this Section 9
of this Memorandum of Understanding, Dentsu may immediately, by notice,
terminate this Memorandum of Understanding and any EB Shareholders' Agreement
incorporating the provisions of this Memorandum of Understanding.
10. Madame EB will cause her designees on the Supervisory Board of
Publicis to comply with the provisions of the Publicis MOU. Madame EB agrees to
use
6
her best efforts to ensure that Dentsu will always be protected against any
dilution from a capital increase of Publicis in cash to which Dentsu is not
entitled to subscribe by using preemptive rights (DROITS PREFERENTIAL DE
PREEMPTION).
11. Dentsu and Madame EB agree that, if any of the arrangements
contemplated by this Memorandum of Understanding would result in Dentsu's
inability to equity account for its investment in Publicis, Dentsu and Madame EB
will use their respective best efforts to adjust such arrangements to the extent
necessary so as to permit Dentsu to equity account for its investment in
Publicis, provided that the economic and legal substance of such adjusted
arrangements will be substantially equivalent to that of the arrangements
contemplated initially by this Memorandum of Understanding.
12. The fact that, at any shareholders' meeting of Publicis, a party to
this Memorandum of Understanding shall cast one or more votes differently from
the votes cast by the other party shall not, of itself, constitute sufficient
ground for either party to seek the termination of this Memorandum of
Understanding.
13. The term of the agreement between Madame EB and Dentsu shall be 12
years, renewable upon mutual agreement of Madame EB and Dentsu.
14. On or before the first date on which Dentsu is required pursuant to
the Support Agreement to vote its B|Com3 shares in favor of the Merger, Dentsu
and Madame EB will enter into a shareholders' agreement (the "EB Shareholders'
Agreement") incorporating the provisions of this Memorandum of Understanding.
Madame EB undertakes to represent the interests of her successors in the
negotiation of the EB Shareholders' Agreement and to obtain their assent thereto
and their execution and delivery thereof to the extent legally appropriate or
necessary.
15. Dentsu and Madame EB will instruct their respective advisers to
negotiate and draft expeditiously the EB Shareholders' Agreement giving effect
to this Memorandum of Understanding and will execute and deliver the same. The
EB Shareholders' Agreement will be in the English language and will be governed
by the laws of the Republic of France. Absent the execution and delivery of the
EB Shareholders' Agreement by the date referred to in Section 13, Dentsu and
Madame EB will continue to be bound by the terms of this Memorandum of
Understanding. All disputes arising under this Memorandum of Understanding or
the EB Shareholders' Agreement, or relating thereto or hereto, will be settled
by binding arbitration in Geneva under the Rules of the London Court of
International Arbitration (the "LCIA"). The arbitral tribunal will be composed
of two arbitrators chosen by the respective parties and a chairman jointly
chosen by the two arbitrators (and absent agreement, by the President du
Tribunal de Premiere Instance du Canton de Geneve"). The arbitration shall be
conducted in the English language.
7
16. This Memorandum of Understanding shall be governed in all respects,
including as to validity, interpretation and effect, by the laws of the Republic
of France.
17. The parties will keep this Memorandum of Understanding strictly
confidential and will not disclose it or the transactions contemplated hereby
except as may be required by applicable law and stock exchange rules and to
their respective advisers. Except as may be required by applicable law or the
rules of any securities exchange on which a party's securities are traded, any
press release or similar communication by either party as to this Memorandum of
Understanding or the transactions contemplated hereby must be reviewed by and
approved in advance in writing by the other party and the other party must be
given a reasonable opportunity to comment thereon.
DENTSU INC
By: /s/ Xxxxxx Xxxxxx /s/ Xxxxxxxxx Xxxxxxxx
-------------------------------- -----------------------------
President XXXXXXXXX XXXXXXXX
8
