-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, sbPyYvClvKb/32YUCh/BnHy50GLcPPYsDHL/fNxgdZ5R8gttBDRvegqCZdt81XQd FLB0H1cJpWLJntXPIzlnxQ== 0000950172-95-000080.txt : 19950615 0000950172-95-000080.hdr.sgml : 19950615 ACCESSION NUMBER: 0000950172-95-000080 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 19950313 SROS: NONE SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: GREY ADVERTISING INC /DE/ CENTRAL INDEX KEY: 0000043952 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-ADVERTISING AGENCIES [7311] IRS NUMBER: 130802840 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-06825 FILM NUMBER: 95520202 BUSINESS ADDRESS: STREET 1: 777 THIRD AVE CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 2125462000 MAIL ADDRESS: STREET 2: 777 THIRD AVE CITY: NEW YORK STATE: NY ZIP: 10017 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: MEYER EDWARD H CENTRAL INDEX KEY: 0000904458 STANDARD INDUSTRIAL CLASSIFICATION: [] FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: C/O GREY ADVERTISING INC STREET 2: 777 THIRD AVENUE CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 2125462656 MAIL ADDRESS: STREET 1: C/O SKADDEN ARPS SLATE MEAGHER STREET 2: 919 THIRD AVENUE CITY: NEW YORK STATE: NY ZIP: 10022 SC 13D/A 1 SCHEDULE 13D AMENDMENT NO. 8 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D Under the Securities Exchange Act of 1934 (Amendment No. 8) GREY ADVERTISING INC. _____________________________________________________________ (Name of Issuer) Common stock, par value $1 per share Limited Duration Class B Common Stock, par value $1 per share _____________________________________________________________ (Title of Class and Securities) 397838 10 3 397838 20 2 ____________________________________________________________ (CUSIP Number of Class of Securities) Edward H. Meyer c/o Grey Advertising Inc. 777 Third Avenue, New York, NY 10017 (212)546-2000 _____________________________________________________________ (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) Copy to: Eric L. Cochran, Esq. Skadden, Arps, Slate, Meagher & Flom 919 Third Avenue New York, New York 10022 (212) 735-3000 January 5, 1995 ____________________________________________________________ (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Statement because of Rule 13d-1(b)(3) or (4), check the following: ( ) Check the following box if a fee is being paid with this Statement: ( ) SCHEDULE 13D CUSIP No. 397838 10 3 (Common Stock) _________________________________________________________________ (1) NAMES OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS Edward H. Meyer _________________________________________________________________ (2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) ( ) (b) (x) _________________________________________________________________ (3) SEC USE ONLY _________________________________________________________________ (4) SOURCE OF FUNDS PF; OO _________________________________________________________________ (5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) __________________________________________________________________ (6) CITIZENSHIP OR PLACE OF ORGANIZATION U.S.A. _________________________________________________________________ (7) SOLE VOTING POWER NUMBER OF SHARES 105,953 shares BENEFICIALLY 76,539 shares (voting power by Mr. OWNED BY EACH Meyer as Trustee; beneficial REPORTING ownership disclaimed) PERSON WITH 25,500 shares (issuable upon conversion of debentures) ___________________________________________ (8) SHARED VOTING POWER 50,833 shares held in Employee Stock Ownership Plan ___________________________________________ (9) SOLE DISPOSITIVE POWER 105,953 shares 25,500 shares (issuable upon conversion of debentures) ____________________________________________ (10) SHARED DISPOSITIVE POWER None _________________________________________________________________ (11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 105,953 shares 25,500 shares (issuable upon conversion of debentures) _________________________________________________________________ (12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES ( ) _________________________________________________________________ (13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 11.6% (14.0%, including the 25,500 shares issuable upon conversion of debentures) _________________________________________________________________ (14) TYPE OF REPORTING PERSON IN SCHEDULE 13D CUSIP No. 397838 20 2 (Class B Stock) _________________________________________________________________ (1) NAMES OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS Edward H. Meyer _________________________________________________________________ (2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) ( ) (b) (x) _________________________________________________________________ (3) SEC USE ONLY _________________________________________________________________ (4) SOURCE OF FUNDS PF; OO _________________________________________________________________ (5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) __________________________________________________________________ (6) CITIZENSHIP OR PLACE OF ORGANIZATION U.S.A. _________________________________________________________________ (7) SOLE VOTING POWER NUMBER OF SHARES 110,053 shares BENEFICIALLY 81,626 shares (voting power by Mr. OWNED BY EACH Meyer as Trustee; beneficial REPORTING ownership disclaimed) PERSON WITH 25,500 shares (issuable upon conversion of debentures) ___________________________________________ (8) SHARED VOTING POWER 56,961 shares held in Employee Stock Ownership Plan ___________________________________________ (9) SOLE DISPOSITIVE POWER 110,053 shares 25,500 shares (issuable upon conversion of debentures) ____________________________________________ (10) SHARED DISPOSITIVE POWER None _________________________________________________________________ (11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 110,053 shares 25,500 shares (issuable upon conversion of debentures) _________________________________________________________________ (12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES (X) _________________________________________________________________ (13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 33.6% (38.4%, including the 25,500 shares issuable upon conversion of debentures) _________________________________________________________________ (14) TYPE OF REPORTING PERSON IN _________________________________________________________________ SCHEDULE 13D ITEM 1. SECURITY AND ISSUER This Amendment No. 8 hereby amends and supplements the Statement on Schedule 13D, as amended, filed by Edward H. Meyer.(1) This filing relates to the shares of Common Stock and the par value $1 per share ("Common Stock") and to the shares of Limited Duration Class B Common Stock, par value $1 per share ("Class B Stock") (the Common Stock and Class B Stock being hereinafter collectively referred to as the "Shares") of Grey Advertising Inc., a Delaware corporation (the "Company" or "Grey"). The Company has its principal executive offices at 777 Third Avenue, New York, New York 10017. ITEM 2. IDENTITY AND BACKGROUND (a)-(b) Edward H. Meyer is Chairman of the Board, Chief Executive Officer and President of the Company. Mr. Meyer's business address is 777 Third Avenue, New York, NY 10017. (c) During the last five years, Mr. Meyer has not been convicted in any criminal proceeding (excluding traffic violations or similar misdemeanors). (d) During the last five years, Mr. Meyer has not been a party to any civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which he was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. (e) Mr. Meyer is a citizen of the United States. ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. On June 1, 1978, Mr. Meyer purchased 500 shares of Common Stock in a private transaction with Mr. Meyer's personal funds for an aggregate purchase price of $15,250. The June 1, 1978 purchase increased Mr. Meyer's ownership of Common Stock to 73,048 shares. Mr. Meyer's purchases of the Common Stock were effected by use of personal funds, promissory notes, bank loans or other financing arrangements. Mr. Meyer disclaims beneficial ownership of 7,500 shares of Common Stock held in trust for Mr. Meyer's children. The Debentures referred to in Items 5 and 6 herein were purchased by Mr. Meyer for an aggregate __________________ 1 Pursuant to Regulation S-T, Item 101(a)(2)(ii), this Amendment restates the entire text of the Schedule 13D and all subsequent amendments thereto, to the extent such information remains current. purchase price of $3,025,000: $25,000 in cash (from personal funds); and the remainder in the form of a 9% promissory note (the "Promissory Note") in the principal amount of $3,000,000. A copy of the Promissory Note is incorporated herein by reference as Exhibit 3. Pursuant to a Stock Option Agreement, dated as of October 13, 1984 (the "1984 Option Agreement"), Mr. Meyer was granted an option (the "1984 Option") to purchase 25,000 shares of Common Stock at an initial exercise price of $129.50. The 1984 Option was granted to Mr. Meyer without cash consideration. A copy of the 1984 Option Agreement is incorporated herein by reference as Exhibit 5. On March 21, 1986, the Board of Directors of the Company declared a stock dividend (the "Distribution") of one share of Class B Stock for each share of Common Stock outstanding as of April 3, 1986. The Distribution was made without cash consideration. After giving effect to the Distribution, the 1984 Option entitled Mr. Meyer to purchase 25,000 shares of each of the Common Stock and the Class B Common Stock (the "Initial Shares"). As adjusted to give effect to the Distribution, the exercise price for the 1984 Option was $64.75 per Share. The terms of the 1984 Option Agreement provided that, at Mr. Meyer's election, the exercise price of the 1984 Option would be reduced by the Dividend Amount (as described below) or Mr. Meyer would be entitled to purchase, using the Dividend Amount, such whole number of additional Shares determined by dividing the exercise price of the 1984 Option into the Dividend Amount. The Dividend Amount generally was defined as the sum of (a) the amount of dividends which would have been payable on the Initial Shares had they been outstanding between the date of grant and the date of exercise and (b) the amount of dividends which would have been payable on additional Shares which could have been purchased at the exercise price using the dividends referred to in clause (a). The terms of the 1984 Option Agreement entitled Mr. Meyer to pay the portion of the 1984 Option exercise price exceeding the par value of the stock underlying the 1984 Option (the "1984 Option Stock") and the Company's tax withholding liability due upon exercise of the 1984 Option with promissory notes. As of December 29, 1992, the Company and Mr. Meyer entered into Amendment No. 1 (the "Amendment") to the 1984 Option Agreement which extended the date payable of such promissory notes to any date up to the ninth anniversary of the Exercise Date, rather than on the second anniversary of the Exercise Date. In addition, the Amendment deleted Section 10 of the 1984 Option Agreement which provided Mr. Meyer with the right to require the Company to repurchase the 1984 Option Stock for one year following the first anniversary of the 1984 Option exercise date in consideration of Mr. Meyer's agreement not to sell the 1984 Option Stock before the first anniversary of the 1984 Option exercise date. A copy of the Amendment is incorporated herein by reference as Exhibit 9. On December 29, 1992, Mr. Meyer exercised the 1984 Option in whole. Mr. Meyer elected to use the Dividend Amount to purchase an additional 8,905 shares of both Common Stock and Class B Stock. Accordingly, Mr. Meyer purchased 33,905 Shares of both Common Stock and Class B Stock for $3,237,500, resulting in an effective exercise price of approximately $47.74 per Share. As payment for the exercise price of the 1984 Option, pursuant to the terms of the 1984 Option Agreement, Mr. Meyer delivered (i) a check payable to the Company in the amount of $67,810 representing the par value of the 1984 Option Stock; (ii) a promissory note in the amount of $3,169,690 representing the balance of the exercise price of the 1984 Option, payable to the Company on December 22, 2001; and (iii) a promissory note in the amount of $2,339,997.61 (collectively, the "1992 Promissory Notes") representing withholding taxes incurred by the Company on the exercise of the 1984 Option by Mr. Meyer, payable to the Company on December 22, 2001. Copies of the 1992 Promissory Notes are incorporated herein by reference as Exhibits 7 and 8. On April 7, 1994, Mr. Meyer exchanged his holdings of the Old Preferred Stock for 20,000 shares of the Series I Preferred Stock, par value $1.00 per share (the "Series I Preferred Stock"), 5,000 shares of the Series II Preferred Stock, par value $1.00 per share (the "Series II Preferred Stock") and 5,000 shares of the Series III Preferred Stock, par value $1.00 per share (the "Series III Preferred Stock") (the Series I Preferred Stock, Series II Preferred Stock and Series III Preferred Stock being hereinafter collectively referred to as the "Preferred Stock") (the "Exchange"). The Exchange was effected pursuant to a Stockholder Exchange Agreement, dated as of April 7, 1994, between the Company and Mr. Meyer (the "Exchange Agreement"). A copy of the Exchange Agreement is incorporated herein by reference as Exhibit 10. The Beneficiaries (as hereinafter defined) of the Voting Trust Agreements (as hereinafter defined) have agreed to deposit the Trust Shares (as hereinafter defined) into the Voting Trusts (as hereinafter defined) of which Mr. Meyer is the sole trustee without consideration by or to Mr. Meyer. The 1995 Option referred to in Item 6 was granted to Mr. Meyer without cash consideration. ITEM 4. PURPOSE OF TRANSACTION. Mr. Meyer holds all of the Shares, the Debentures, and Preferred Stock for purposes of investment. Due to his holding of securities of the Company and his position with the Company, Mr. Meyer may influence the direction of the management and policies of the Company. Mr. Meyer may acquire additional Shares by exercising the 1995 Option (as hereinafter defined). In addition, Mr. Meyer may elect to purchase additional Shares or sell any Shares held at any time subject to applicable law. Any such determination may be based on a number of factors, including the continued employment of Mr. Meyer by the Company, the price and availability of Shares, subsequent developments affecting the Company, the Company's business and prospects, general stock market and economic conditions and other similar factors. Except as set forth above, Mr. Meyer has no present plans or proposals that relate to or would result in any of the actions described in subparagraphs (a) through (j) of Item 4 of Schedule 13D. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER. As of December 31, 1994, Mr. Meyer owns 131,453 shares of Common Stock (including 25,500 shares that are issuable upon conversion of Mr. Meyer's holdings of $3,025,000 principal amount of the Company's 8 1/2% Convertible Subordinated Debentures Due December 10, 1996 (the "Debentures")) and 135,553 shares of Class B Stock (including 25,500 shares that are issuable upon conversion of the Debentures), representing approximately 14.0% and 38.4%, respectively, of the Common Stock and Class B Stock outstanding, assuming such additional shares were outstanding.(2) In addition, Mr. Meyer owns 20,000 shares of Series I Preferred Stock, 5,000 shares of Series II Preferred Stock and 5,000 shares of Series III Preferred Stock, representing 100% of the outstanding shares of each series of Preferred Stock. Mr. Meyer disclaims beneficial ownership of 7,500 shares of Common Stock and 7,500 shares of Class B Stock held in trust for Mr. Meyer's children, and of 50,833 shares of Common Stock and 56,961 shares of Class B Stock (approximately 5.6% and 17.4%, respectively, of the outstanding Common Stock and Class B Stock) held in the Company's Employee Stock Ownership Plan (the "ESOP"), as to which Mr. Meyer exercises shared voting power by virtue of his membership on the committee charged with its administration. The aggregate number of shares of the Company's Common Stock and Class B Stock held by the voting trust (the "1994 Voting Trust") created pursuant to the Voting Trust Agreement, dated as of February 24, 1986, as amended and restated as of August 31, 1987 and again amended and restated as of March 21, 1994 (the "1994 Voting Trust Agreement") among the several beneficiaries thereunder (the "Beneficiaries"), the Company and Mr. Meyer, as the sole voting trustee (the "Trustee"), as of December 31, 1994 was 181,092 shares of Common Stock (approximately 19.8% of the shares of Common Stock outstanding) and 190,595 shares of Class B Stock (approximately 58.1% of the shares of Class B Stock outstanding).(3) As of December 31, 1994, the voting _________________________ 2 Based on 915,734 shares of Common Stock and 327,917 shares of Class B Stock outstanding as of December 31, 1994. 3 Including 105,953 shares of Common Stock and 110,053 shares of Class B Stock beneficially owned by Mr. Meyer. trust (the "1989 Voting Trust") created pursuant to the Voting Trust Agreement, dated as of December 1, 1989, among the several beneficiaries thereunder (the "1989 Beneficiaries"), the Company and Mr. Meyer, as the Trustee (the "1989 Voting Trust Agreement") (the 1994 Voting Trust and the 1989 Voting Trust being herein collectively referred to as the "Voting Trusts" and the 1994 Voting Trust Agreement and the 1989 Voting Trust Agreement being herein collectively referred to as the "Voting Trust Agreements") held 1,084 shares of Class B Stock (approximately 0.3% of the shares of Class B Stock outstanding) and holds no Common Stock. For a more detailed description of the terms of the Voting Trusts, reference is made to Amendment No. 6 to the Statement on Schedule 13D, dated March 10, 1995, by Mr. Meyer, as trustee on behalf of the Voting Trusts. In addition, the Beneficiaries have the right to acquire an aggregate of 18,534 shares of Common Stock at exercise prices between $93.00 and $141.50 through the exercise of outstanding options (the "Trust Options"). Pursuant to the terms of the 1994 Voting Trust Agreements, the Beneficiaries have severally agreed that upon exercise, such shares would be transferred into the Voting Trusts and held subject to the Voting Trust Agreements. Mr. Meyer, by virtue of his position as Trustee, may be deemed to have the power to vote the Shares held in the 1994 Voting Trust (the "Trust Shares") and may therefore be deemed, for the purposes of Rule 13d-3 under the Securities Exchange Act of 1934 (the "Exchange Act"), to own beneficially such Trust Shares. Mr. Meyer disclaims beneficial ownership of any Trust Shares deposited in the Voting Trusts by anyone other than himself. Including the Trust Shares issuable upon the exercise of the Trust Options and the conversion of the Debentures, the Voting Trusts may be deemed to beneficially own, pursuant to Rule 13d-3 under the Exchange Act, (i) 225,126 shares of Common Stock, (ii) 217,179 shares of Class B Stock and (iii) 2,396,916 votes entitled to be cast at a meeting of stockholders of the Company. The numbers in clauses (i)-(iii) above do not reflect any shares held by various benefit plans of the Company administered by committees of which Mr. Meyer is a member. On February 21, 1995, as more fully described under Item 6, the Company finalized the documentation relating to the issuance to Mr. Meyer of an option to purchase 40,000 shares of Common Stock effective as of January 5, 1995 (the "Effective Date"). Such option became exercisable as to 13,333 shares as of the Effective Date. Including those shares as to which the 1995 Option is presently exercisable, the aggregate number of shares of the Common Stock and the Preferred Stock held by Mr. Meyer, the Common Stock and Class B Stock held by the Voting Trusts (including the shares issuable upon the exercise of the 1995 Option and conversion of the Debentures) and the Common Stock and Class B Stock held by the ESOP represents 69.5% of the votes entitled to be cast at a meeting of stockholders of the Company, assuming such additional shares were outstanding. ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS AND RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. Pursuant to a Purchase Agreement, dated as of December 10, 1983 (the "Purchase Agreement"), Mr. Meyer purchased the Debentures in the aggregate principal amount of $3,025,000. The Debentures were issued to Mr. Meyer in consideration for $25,000 in cash and the Promissory Note in the aggregate principal amount of $3,000,000. The Debentures are convertible at any time into shares of Common Stock, at an initial conversion price of $121 per share, subject to adjustment upon the occurrence of certain events. As of November 19, 1991, the Company and Mr. Meyer entered into an Extension Agreement which extended the maturity date to December 10, 1997. The Debentures bear interest at the rate of 8 1/2% per annum. Copies of the Purchase Agreement, the Debentures and the Promissory Note are incorporated herein by reference as Exhibits 1, 2 and 3, respectively. In accordance with Mr. Meyer's employment agreement with Grey, Mr. Meyer will have an option to sell to Grey all securities held by him at such time at the market price therefor if Grey terminates his full- time employment as Chief Executive Officer without cause or if he effects such a termination due to a change in control of Grey or other good reason. A copy of Mr. Meyer's employment agreement is incorporated herein by reference as Exhibit 4. Pursuant to a Registration Rights Agreement, dated June 5, 1986 (the "Registration Rights Agreement" incorporated herein by reference as Exhibit 12), Mr. Meyer has demand registration rights, subject to certain limitations, to request that the Company register all Shares owned by him in compliance with the Securities Act of 1933 (the "Securities Act"); provided, however, that the Company shall not be required to register such Shares more than once within any thirty month period. Further, if the Company determines to proceed with the registration of any of its securities under the Securities Act excluding, among other limitations, shares of Common Stock issued pursuant to employee benefit plans, Mr. Meyer will be entitled to participate in such registration. The Company will bear the expense of the registrations described in the Registration Rights Agreement and will indemnify Mr. Meyer against certain liabilities, including liabilities under the Securities Act. This is a summary description only and is qualified in its entirety by reference to the Registration Rights Agreement which is filed herewith as Exhibit 12 and incorporated herein by reference. In accordance with the terms of the Certificates of Designation of the Preferred Stock, each share held of record of the Preferred Stock is entitled to eleven votes entitled to be cast at a meeting of stockholders of the Company. The holders of such stock may receive, at their election, shares of Common Stock upon redemption of their Preferred Stock. The terms of the Preferred Stock give a holder the option to require the Company to redeem his or her Preferred Stock for a period of 12 months following his or her (i) death, (ii) permanent disability or permanent mental disability, (iii) termination of full-time employment for good reason and (iv) termination of full- time employment by the Company without cause. In addition, in accordance with the Certificate of Designation of the Series I Preferred Stock, the holders of Series I Preferred Stock, 100% of which is held by Mr. Meyer, are entitled to special voting rights in connection with the election of directors and the approval of extraordinary transactions. Reference is made to Grey's Certificate of Incorporation, which is on file with the Securities and Exchange Commission as an exhibit to Grey's public filings and incorporated herein by reference as Exhibit 11, for the complete texts of the Certificates of Designation, which contain all the terms of the Series I, Series II and Series III Preferred Stock. The Exchange Agreement contains customary representations and warranties, as well as the following contractual rights: (i) a put right exercisable by Mr. Meyer at the time of redemption of the outstanding shares of the Preferred Stock of certain shares of the Company's Common Stock held by Mr. Meyer so that Mr. Meyer does not suffer adverse tax consequences as a result of the redemption, (ii) an extension to April 7, 2004 of the maturity date of the promissory notes issued by Mr. Meyer as partial consideration for the Old Preferred Stock which Mr. Meyer exchanged for the Preferred Stock, and (iii) after the outstanding shares of the Series I Preferred Stock are redeemed, an obligation by the Company to use its best efforts to elect to its Board of Directors that number of persons designated by Mr. Meyer (or if he is no longer alive or is mentally disabled, a representative of his family and/or his estate) corresponding to the proportion of the capital stock of the Company then owned by Mr. Meyer and his family, but in no event less than one director so long as Mr. Meyer and his family own at least five percent of the outstanding capital stock of the Company. Pursuant to the 1994 Voting Trust Agreement, except for sales, transfers and dispositions pursuant to the Company's ESOP and Restricted Stock Plan, no Beneficiary may (i) until April 3, 1996, sell, transfer or dispose all or any portion of the Class B Stock which forms part of the Trust Shares in which he or she holds a beneficial interest, no such person may convert any such shares of Class B Stock into Common Stock and no such person may withdraw any such shares of Class B Stock from the Trust, and (ii) following April 3, 1996 through the term of the 1994 Voting Trust as may subsequently be extended, sell, transfer or dispose all or any portion of the Trust Shares in which he or she holds a beneficial interest, and no such person may withdraw any Trust Shares from the Trust, during any of the following periods: (a) From the announcement by any person other than Grey of a tender or exchange offer for shares of capital stock of Grey until 30 days following the termination of such offer; (b) From the time when it shall have been publicly disclosed, or Grey shall have learned, that any person or "group" (as defined in Section 13(d) of the Exchange Act) shall have acquired, or proposed to acquire (whether or not any such proposed acquisition is conditioned on any future event), more than 20% of any class of Grey's outstanding capital stock until 30 days following the announcement that such person or "group" no longer owns, or has abandoned its intention to acquire more than such percentage of such stock; (c) From the time that any new group shall be formed which beneficially owns or proposes to acquire (whether or not any such proposed acquisition is conditioned on any future event) more than 20% of the beneficial ownership of any class of Grey's capital stock until 30 days following the announcement that such group has been abandoned or no longer owns such percentage of such stock; (d) From (X) the commencement of (I) any contest for the election or removal, or increase or decrease in the number, of directors of Grey or (II) any contest concerning the proposed approval by Grey's stockholders of any proposal for the merger, consolidation, other business combination or liquidation of Grey or (III) any contest concerning the approval by Grey's stockholders of any other matter deemed by the Trustee to be material to the continuity and stability of the management, policies and client relationships of Grey (regardless of whether such contest involves an annual or special meeting of stockholders of Grey or the solicitation of consents of such stockholders for use other than at such a meeting) until (Y) thirty days following the earlier of (I) the Grey stockholder vote with respect thereto and (II) any other termination or abandonment of the contest. Pursuant to the terms of the 1994 Voting Trust Agreement, the 1994 Voting Trust Agreement in all respects supersedes the voting trust agreement, dated as of February 24, 1986 among certain Beneficiaries (as defined therein), Grey, Meyer and Ronald A. Nicholson and the voting trust agreement (the "1987 VTA"), dated as of August 31, 1987 among the beneficiaries executing the 1987 VTA, Grey and Meyer. The 1994 Voting Trust Agreement shall continue in force until March 21, 2004, unless extended as allowed by law. Mr. Meyer shall (subject to his right to resign as Trustee) remain in office as Trustee until the earliest of (i) his death, (ii) his permanent mental disability, (iii) the effectiveness of his appointment of a successor trustee and (iv) the expiration of (x) two years following the termination of his employment as chief executive officer of Grey for cause or (y) six years following the termination of his employment as chief executive officer of Grey for any other reason (the "Two/Six Year Date"). Meyer may, in his sole discretion, at any time before or after the Two/Six Year Date, designate a person or persons to serve as an additional Trustee or Trustees or to serve as successor Trustee or Trustees upon one or more conditions established by Meyer. Immediately following the Two/Six Year Date the Chief Executive Officer of Grey shall automatically, ex officio, become a Trustee if not already so serving, and he shall remain as a Trustee (subject to his right to resign as a Trustee) so long as he shall continue in office as Grey's Chief Executive Officer. At any time, a majority of the Trustees (or the sole Trustee if there is only one) in office may appoint one or more additional or successor Trustees. In the event of a deadlock, the decision of the Trustee longest in office shall govern. At such time as Meyer shall cease for any reason to be Trustee, if he shall not have appointed a successor Trustee, Mr. Kaplan, provided he is then an officer or director of Grey, shall succeed Meyer as Trustee. At such time as Mr. Kaplan shall cease for any reason to be a Trustee or if Mr. Kaplan for any reason shall not succeed Meyer as Trustee, the Chief Executive Officer of Grey shall succeed Meyer as Trustee, if Meyer shall not have appointed a successor Trustee. The terms of the 1989 Voting Trust Agreement as well as the provisions regarding the Trustee are substantially similar to those of the 1994 Voting Trust Agreement. However, a Beneficiary of the 1989 Trust may, in addition to the transfer provisions described above, transfer Trust Shares to the Old Trust (as defined in the 1989 Voting Trust Agreement). For a more detailed description of the terms of the Voting Trusts, as well as the manner in which the 1994 Voting Trust may be anticipated over time to concentrate the voting power of the Company in Mr. Meyer and give him effective control of the Company, reference is made to the Schedule 13-D and amendments thereto filed by the Voting Trusts with the Securities and Exchange Commission. The Company has an ESOP under which the Company contributes either shares of Common Stock or cash to a trust. Cash contributions must be invested primarily in Common Stock. Contributions to participants under the ESOP are distributed upon the termination of a participant's employment or upon his or her death. Mr. Meyer shares voting power over shares held in the Company's ESOP by virtue of his membership on the committee charged with the ESOP's administration. On February 21, 1995, the Company finalized the documentation relating to a Stock Option Agreement, effective as of January 5, 1995 (the "Effective Date"), between the Company and Mr. Meyer (the "1995 Option Agreement", incorporated herein by reference as Exhibit 13), an option (the "1995 Option") to purchase 40,000 shares of Common Stock pursuant to the Company's 1994 Stock Incentive Plan (the "Plan", incorporated herein by reference as Exhibit 14). The 1995 Option became exercisable as to 13,333 shares as of the Effective Date and will become exercisable as to the remaining shares in equal installments on January 5, 1996 and January 5, 1997. The 1995 Option expires on January 5, 2004. The number of shares subject to the 1995 Option and/or the exercise price are subject to adjustment upon the occurrence of certain events such as stock dividends, recapitalizations resulting in stock splits or combinations or exchanges in respect of the Common Stock. The foregoing is a summary description only and is qualified in its entirety by reference to the 1995 Option Agreement and the complete text of the Plan which are filed herewith as Exhibits 13 and 14, respectively, and incorporated herein by reference. ITEM 7. MATERIAL TO BE FILED AS EXHIBITS(4) Exhibit 1 Purchase Agreement, dated as of December 10, 1983, between Grey and Edward H. Meyer. Exhibit 2 Grey Advertising Inc. 8 1/2% Convertible Subordinated Debentures Due December 10, 1991. Exhibit 3 Promissory Note executed and delivered by Edward H. Meyer to Grey. Exhibit 4 Agreement, dated as of February 9, 1984, between Grey and Edward H. Meyer. Exhibit 5 Stock Option Agreement, dated as of October 13, 1984, between Grey and Edward H. Meyer. Exhibit 6 Grey's Executive Growth Plan, as amended. Exhibit 7 Promissory Note No. 1, dated December 29, 1992, from Edward H. Meyer, to the Company. Exhibit 8 Promissory Note No. 2, dated December 29, 1992, from Edward H. Meyer to the Company. Exhibit 9 Amendment No. 1 to the Grey Advertising Inc. Stock Option Agreement, dated as of December 29, 1992, between the Company and Edward H. Meyer. _____________________ 4 Pursuant to Regulation S-T, Item 102(a) previously filed paper exhibits are not being restated in electronic format herewith. Exhibit 10 Stockholder Exchange Agreement, dated as of April 7, 1994, by and between the Company and Edward H. Meyer (filed as Exhibit No. 10(a) of the Company's Report on Form 8-K, dated April 7, 1994, and incorporated herein by reference). Exhibit 11 Restated Certificate of Incorporation of the Company (filed as Exhibit No. 3(a) of the Company's Report on Form 8-K, dated April 7, 1994, and incorporated herein by reference). Exhibit 12 Registration Rights Agreement, dated as of June 5, 1986, between the Company and Edward H. Meyer. Exhibit 13 Stock Option Agreement, effective as of January 5, 1995, by and between the Company and Edward H. Meyer. Exhibit 14 Grey Advertising Inc. 1994 Stock Incentive Plan. SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: March 10, 1995 /s/ Edward H. Meyer EDWARD H. MEYER INDEX TO EXHIBITS Sequentially Numbered Exhibit No. Exhibit Page 1 Purchase Agreement, dated as of N/A December 10, 1983, between Grey and Edward H. Meyer. 2 Grey Advertising Inc. 8 1/2% N/A Convertible Subordinated Debentures Due December 10, 1991. 3 Promissory Note executed and N/A delivered by Edward H. Meyer to Grey. 4 Agreement, dated as of February N/A 9, 1984, between Grey and Edward H. Meyer. 5 Stock Option Agreement, dated N/A as of October 13, 1984, between Grey and Edward H. Meyer. 6 Grey's Executive Growth Plan, N/A as amended. 7 Promissory Note No. 1, dated N/A December 29, 1992, from Edward H. Meyer, to the Company. 8 Promissory Note No. 2, dated N/A December 29, 1992, from Edward H. Meyer to the Company. 9 Amendment No. 1 to the Grey N/A Advertising Inc. Stock Option Agreement, dated as of December 29, 1992, between the Company and Edward H. Meyer. 10 Stockholder Exchange Agreement, N/A dated as of April 7, 1994, by and between the Company and Edward H. Meyer (filed as Exhibit No. 10(a) of the Company's Report on Form 8-K, dated April 7, 1994, and incorporated herein by reference). 11 Restated Certificate of N/A Incorporation of the Company (filed as Exhibit No. 3(a) of the Company's Report on Form 8- K, dated April 7, 1994, and incorporated herein by reference). 12 Registration Rights Agreement, 20 dated as of June 5, 1986, between the Company and Edward H. Meyer. 13 Stock Option Agreement, 40 effective as of January 5, 1995, by and between the Company and Edward H. Meyer. 14 Grey Advertising Inc. 1994 51 Stock Incentive Plan EX-99 2 REGISTRATION RIGHTS AGREEMENT REGISTRATION RIGHTS AGREEMENT, dated as of June 5, 1986 (the "Agreement"), between GREY ADVERTISING INC., a Delaware corporation with principal offices at 777 Third Avenue, New York, New York 10017 ("Grey"), and EDWARD H. MEYER, whose principal residence is 580 Park Avenue, New York, New York 10022 ("Meyer"). WHEREAS, Grey and Meyer entered into a Purchase Agreement dated as of December 10, 1983 (the "Purchase Agreement") which provided for the sale to Meyer of $3,025,000 principal amount of Grey's Convertible Subordinated Debentures due December 10, 1991 (the "Debentures"), and granted to Meyer certain registration rights with respect to the shares of common stock, par value $1 per share (the "Shares"), of Grey issuable upon conversion of the Debentures; WHEREAS, Grey and Meyer also entered into a Stock Option Agreement dated as of October 13, 1984 (the "Stock Option Agreement") which granted to Meyer an option (the "Stock Option") to purchase up to 25,000 Shares (as that number of Shares may be adjusted in accordance with the terms of the Stock Option Agreement), and granted to Meyer certain registration rights with respect to the Shares subject to the Stock Option; and WHEREAS, both Grey and Meyer deem it to be in their mutual best interest to enter into a single agreement providing registration rights to Meyer with respect to all Shares presently owned or hereafter acquired by him, including without limitation whatsoever upon conversion of shares of Limited Duration Class B Common Stock (the "Registrable Shares"), and thereby facilitate the orderly distribution by Meyer of his Shares if and when Meyer should decide to dispose of some or all of his Shares; NOW, THEREFORE, in consideration of the mutual agreements contained herein, the parties hereto, intending to be legally bound, hereby agree as follows: 1. Demand Registration Rights If Grey shall receive, at any time or from time to time, a written request from Meyer for the registration of any Registrable Shares, Grey shall cause, in accordance with the Registration Procedures set forth in Section 8, the offering of such Registrable Shares to be registered as promptly as practicable so as to permit the sale or other distribution thereof by Meyer, and in connection therewith shall prepare and file on an appropriate form a registration statement under the Securities Act of 1933 (the "Securities Act"), and the rules and regulations thereunder, covering such Registrable Shares. Notwithstanding the foregoing, Grey shall not be required to file a registration statement pursuant to Meyer's request under this Section 1 more frequently than once in any thirty month period. In the case of any request by Meyer to exercise his rights pursuant to this Section 1 (the "Demand Registration Rights") which involves an underwritten public offering, the managing underwriter or underwriters of such offering shall be selected by Meyer, and approved by Grey, which approval shall not unreasonably be withheld. In addition, Grey shall not be required to file any such registration statement at any time when Grey is actively contemplating an underwritten public offering and the registration of the Registrable Shares would, in the good faith judgment of Grey's investment banker, materially interfere with the orderly sale of the shares of capital stock by Grey; provided, however, that Grey shall not be able to delay, pursuant to this sentence, any such filing for a period greater than ninety days. 2. Participation Registration Rights If Grey shall at any time determine to proceed with the actual preparation and filing of a registration statement under the Securities Act, and the rules and regulations thereunder, in connection with an offering of securities for cash, Grey shall give written notice as promptly as practicable of such determination to proceed with the preparation and filing of such registration statement to Meyer and shall include in such registration statement such number of Registrable Shares as Meyer shall request within 20 days after receipt of such notice from Grey, upon the same terms (including the method of distribution) as the offering which is being made by Grey; provided, however, that (i) Grey shall not be required to give notice or to include such Registrable Shares in any registration statement relating solely to Shares or other securities to be issued (A) pursuant to Grey's Restricted Stock Plan, Grey's Incentive Stock Option Plan or another employee benefit plan of Grey, (B) in exchange for securities or assets of, or in connection with a merger or consolidation with, another corporation, or (C) in exchange for other securities of Grey; and (ii) in the event that the inclusion of all the Registrable Shares requested by Meyer for inclusion pursuant to this Section 2 would, in the good faith judgment of the managing underwriter of such public offering, materially interfere with the orderly sale and distribution of the securities offered by Grey, the number of Registrable Shares otherwise to be included in the underwritten public offering may be reduced to the extent deemed necessary by such managing underwriter acting in good faith or the sale of such Shares shall be subject to such other conditions as the managing underwriter deems appropriate. In the event that other persons have rights similar to Meyer's under this Section 2 and the inclusion of all Registrable Shares requested by Meyer and all shares requested by persons with similar rights to Meyer would, in the good faith judgment of the managing underwriter of such public offering, materially interfere with the orderly sale and distribution of the securities offered by Grey, the shares requested for inclusion by such other persons shall be reduced and, if necessary, excluded before any Registrable Shares are reduced or excluded in accordance with clause (ii) of the preceding sentence. Grey may, without the written consent of Meyer, withdraw such registration statement and abandon the proposed offering in which Meyer had requested to participate. 3. Limitations on Registration Rights (a) Except as herein provided, Grey shall not be obligated to keep any registration statement filed pursuant to this Agreement effective for more than one hundred eighty days. (b) Notwithstanding anything contained herein to the contrary, Grey's obligation to register Shares on behalf of the Meyer pursuant to Sections l or 2 of this Agreement shall terminate at such time as Grey shall receive either an opinion of counsel reasonably acceptable to Meyer or a "no action" letter from the staff of the Securities and Exchange Commission (the "SEC") to the effect that the Shares then held by Meyer may be sold or otherwise disposed of publicly without registration under the Securities Act. (c) Notwithstanding anything contained herein to the contrary, Grey shall not be required pursuant to Sections 1 and 2 of this Agreement to register on behalf of Meyer in any one registration statement less than 20,000 Shares or such lesser number of Shares which shall constitute the sum of all the Shares which either (i) are held by Meyer, his estate or his successors, or (ii) are still issuable upon exercise of the Stock Option, conversion of the Debentures held by such persons, or upon the exercise or conversion of any other right or security held by Meyer, his estate or his successors. Such number shall be appropriately adjusted for stock splits, stock dividends, combinations of shares, reclassifications or other similar events. 4. Blue Sky Registration Grey shall use its best efforts to effect such registration, qualification or exemption under Blue Sky or other state securities laws as may be reasonably requested by Meyer to permit or facilitate the sale or other distribution of the Registrable Shares but Grey shall not be obligated to qualify the Shares in any jurisdictions where such qualifications would (and Grey's business in the ordinary course does not) (i) require Grey to qualify generally to do business as a foreign company in such jurisdictions, (ii) subject Grey to taxation in such jurisdictions, or (iii) otherwise subject Grey to consent to general service of process in such jurisdictions. 5. Expenses Grey shall pay all expenses necessary to effect under the Securities Act any registration statements, amendments or supplements filed pursuant to Sections 1 and 2 (other than underwriters' discounts and commissions and brokerage commissions and fees, if any, payable with respect to Registrable Shares sold by Meyer and fees and expenses of counsel for Meyer, as well as registration fees of the SEC), including, without limitation, printing expenses, expenses of compliance with Blue Sky or other state securities laws, and legal and audit fees incurred by Grey in connection therewith, subject, however, to the following sentence. Grey shall not be required to furnish any audited financial statements at the request of Meyer other than those statements customarily prepared at the end of its fiscal year, unless Meyer shall agree to reimburse Grey for the out-of-pocket costs incurred by Grey in the preparation of such other audited financial statements. 6. Indemnification (a) In the event of any registration pursuant to this Agreement, Grey shall indemnify and hold harmless Meyer and each person, if any, who controls Meyer within the meaning of the Securities Act, against any losses, claims, damages, expenses (including attorneys' fees), or liabilities (or actions in respect thereof) under the Securities Act or otherwise, which arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in any such registration statement, any preliminary prospectus or final prospectus contained therein, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading; and shall reimburse Meyer and each such controlling person for any legal or other expenses reasonably incurred by Meyer or such controlling person in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that Grey shall not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in said registration statement, said preliminary prospectus, said prospectus, or any said amendment or supplement, in reliance upon and in conformity with written information furnished by Meyer specifically for use in the preparation thereof. (b) Meyer shall indemnify and hold harmless Grey, each of its directors, each of its officers who have signed any such registration statement, and each person, if any, who controls Grey within the meaning of the Securities Act, against any losses, claims, damages or liabilities to which Grey or any such director, officer, or controlling person may become subject, under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue or alleged untrue statement of any material fact contained in said registration statement, said preliminary prospectus, said prospectus, or said amendment or supplement thereto, or arise out of or are based upon the omission or the alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in said registration statement, said preliminary prospectus, said prospectus, or said amendment or supplement, in reliance upon and in conformity with written information furnished by Meyer specifically for use in the preparation thereof and shall reimburse any legal or other expenses reasonably incurred by Grey or any such director, officer, or controlling person in connection with investigating or defending any such loss, claim, damage, liability or action. (c) Promptly after receipt by an indemnified party under this Section 6 of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against any indemnifying party under this Section 6, notify the indemnifying party of the commencement thereof. (d) In case any such action is brought against any indemnified party, and it notifies an indemnifying party of the commencement thereof, the indemnifying party shall be entitled to defend any such action, with counsel reasonably satisfactory to the indemnified party, provided that the indemnifying party may not settle any such action the settlement terms of which are non- monetary (or which cannot be reduced to monetary terms), without the approval of the indemnified party. Notwithstanding the foregoing, to the extent that in the reasonable judgment of the indemnified party a conflict of interest exists between the indemnified party and the indemnifying party, the indemnified party may retain its own counsel, who shall be reasonably satisfactory to the indemnifying party, and participate in the defense of such action (although the indemnifying party's counsel shall be entitled to control the defense of any such action). The fees and expenses of such counsel shall be borne by the indemnifying party. 7. Registration Procedures (a) If and whenever Grey is required to register any Registrable Shares under the Securities Act as provided under the Demand Registration Rights provisions of this Agreement (Section 1), Grey shall, as expeditiously as possible: (i) prepare and file a registration statement with the SEC with respect to such Registrable Shares and use its best efforts to cause such registration statement to become effective; (ii) prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to keep such registration statement effective for a period not in excess of one hundred eighty days and to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement during such period in accordance with the intended methods of disposition by Meyer set forth in such registration statement: (iii) furnish to Meyer such number of copies of such registration statement and of each such amendment and supplement thereto (in each case including all exhibits), such number of copies of the prospectus included in such registration statement (including each preliminary prospectus and summary prospectus), in conformity with the requirements of the Securities Act, and such other documents as Meyer may reasonably request in order to facilitate the disposition of the Registrable Shares by Meyer; (iv) notify Meyer, at any time when a prospectus relating thereto is required to be delivered under the Securities Act within the appropriate period mentioned in subsection (a) (ii) of this Section 7, of Grey becoming aware that the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing, and at the request of Meyer, prepare and furnish to Meyer a reasonable number of copies of an amended or supplemental prospectus as may be necessary so that, as thereafter delivered to the purchasers of such Registrable Shares, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing; (v) otherwise use its best efforts to comply with all applicable rules and regulations of the SEC, and make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve months, but not more than eighteen months, beginning with the first month after the effective date of the Registration Statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and the rules and regulations promulgated thereunder; (vi) use its best efforts to list such Registrable Shares in the event Shares are then listed on a securities exchange, on any securities exchange on which the Shares are then listed, if such Registrable Shares are not already so listed and if such listing is then permitted under the rules of such exchange, and to provide a transfer agent and registrar for such Registrable Shares covered by such registration statement not later than the effective date of such registration statement; and (vii) make available for inspection by Meyer, by any underwriter participating in any disposition to be effected pursuant to such registration statement and by any attorney, accountant or other agent retained by Meyer or any such underwriter, all pertinent financial and other records, pertinent corporate documents and properties of Grey, and cause all of Grey's officers, directors and employees to supply all information reasonably requested by Meyer, any such underwriter, attorney, accountant or agent in connection with such registration statement. (b) If and whenever Grey is required to register any Registrable Shares under the Securities Act as provided in this Agreement, Meyer shall, as expeditiously as possible: (i) furnish to Grey such information regarding Meyer's holdings of Shares and the proposed manner of distribution thereof and such additional matters related thereto as Grey may reasonably request in connection with any registration statement, any preliminary prospectus or final prospectus, or any amendment or supplement thereto resulting from this Agreement; and (ii) notify Grey, at any time when a prospectus relating thereto is required to be delivered under the Securities Act, of Meyer becoming aware that the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing. (c) With respect to any underwritten offering, Meyer and Grey shall, in addition to the foregoing, enter into such customary agreements (including an underwriting agreement in customary form) and take such other actions as may be reasonably necessary to expedite or facilitate the disposition of the Registrable Shares being registered. 8. Notices Any notice herein required or permitted to be given shall be in writing and may be personally served or sent by United States first-class mail and shall be deemed to have been given when deposited in the United States mail, registered, with postage prepaid and properly addressed. For the purpose hereof, the address of Meyer shall be: Edward H. Meyer 580 Park Avenue New York, New York 10022 and the address of Grey shall be: Grey Advertising Inc. 777 Third Avenue New York, New York 10017 Attention: Corporate Secretary Both Meyer and Grey may change the address for notices by giving written notice to the other as herein provided. 9. Miscellaneous (a) Waiver of Compliance. Any failure of any of the parties hereto to comply with any obligation, covenant or agreement contained herein may be waived by the party entitled to the benefit of such obligation, covenant or agreement only by written instrument signed by such party, but such waiver or failure to insist upon strict compliance with such obligation, covenant or agreement shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure. (b) Severability. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision or any other jurisdiction, but this Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein. (c) Successors and Permitted Assigns. Except as expressly indicated herein, this Agreement is intended to bind and inure to the benefit of and be enforceable by Meyer and Grey and their respective successors and permitted assigns. (d) Complete Agreement. This Agreement and the other documents expressly referred to herein embody the complete agreement and understanding among the parties and supersede and preempt any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof including, but not limited to, the registration rights provisions presently contained in the Stock Option Agreement and the Purchase Agreement. This Agreement may be amended only by an agreement in writing executed by the parties hereto. (e) Term. Notwithstanding anything contained herein to the contrary, the term of this Agreement, including the respective obligations of the parties hereunder, shall expire three years from the date on which Meyer shall cease being the Chief Executives Officer of Grey. (f) Section Headings. The section headings contained in this Agreement are solely for the purpose of reference, are not part of the agreement of the parties and shall not in any way affect the meaning or interpretation of this Agreement. (g) Counterparts. This Agreement may be executed in separate counterparts, any one of which need not contain the signatures of more than one party, but all of which taken together constitute one and the same agreement. (h) Choice of Law. The law of the State of New York shall govern all questions concerning the construction, validity and interpretation of this Agreement without regard to the principles of conflicts of law thereof. IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written. [SEAL] GREY ADVERTISING INC. By /s/ Alan B. Fendrick Name: Title: /s/ Edward H. Meyer Edward H. Meyer EX-99 3 STOCK OPTION AGREEMENT GREY ADVERTISING INC. STOCK OPTION AGREEMENT AGREEMENT, dated as of January 5, 1995, by and between GREY ADVERTISING INC., a Delaware corporation ("Company"), and EDWARD H. MEYER, residing at 580 Park Avenue, New York, N. Y. 10021 (such individual or, as the context requires, his/her guardian, legal representative, estate or other person to whom the rights hereunder may be transferred by will or by the laws of descent and distribution, being hereinafter referred to as the "Optionee"). Pursuant to the Grey Advertising Inc. 1994 Stock Incentive Plan ("Plan"), the Board of Directors, or a committee thereof, of the Company ("Board") has granted the Optionee, on the terms and conditions set forth herein, an option to purchase 40,000 shares of the Company's common stock, par value $1 per share ("Common Stock"). The Plan is hereby incorporated by reference and made a part hereof, and this Agreement shall be subject to all terms and conditions thereof. NOW THEREFORE, the Company and the Optionee hereby agree as follows: 1. Grant of Option. (a) Number of Shares and Option Price. In accordance with the allotment made by the Committee and subject to the terms and conditions hereof, the Company grants, as of the date hereof, to the Optionee a non-qualified option to purchase ("Option") an aggregate of 40,000 shares of Common Stock ("Option Shares") at an option option exercise price of $148.50 per share, which price is subject to adjustment in accordance with Section 4 of this Agreement. The option price, as adjusted from time to time, is hereinafter referred to as the "Option Price". (b) Term of Option; Conditions and Manner of Exercise. (i) The term of the Option and of this Agreement shall commence as of the date hereof ("Date of Grant") and, unless earlier terminated as provided in this Agreement, shall terminate upon the expiration of nine years from the Date of Grant. Upon the termination of the Option, all rights of the Optionee hereunder shall cease. (ii) The Option, subject to the following provisions of this paragraph, shall become exercisable in cumulative installments as follows: one-third of the shares subject to the Option from and after the Date of Grant; one-third of the shares subject to the Option from and after the first anniversary of the Date of Grant; and one-third of the shares subject to the Option from and after the second anniversary of the Date of Grant; provided, however, that the Option may be exercised only to purchase whole shares, and in no case may a fraction of a share be purchased. The right of the Optionee to purchase Option Shares with respect to which the Option has become exercisable as herein provided may be exercised in whole or in part at any time or from time to time prior to the ninth anniversary of the Date of Grant. (iii) The Option (or any portion thereof) shall be exercised in the following manner: the Optionee shall deliver to the Company written notice of the exercise of the Option (or any portion thereof) in a form satisfactory to the Board, specifying the number of Option Shares subject to the Option which the Optionee elects to purchase, together with full payment of the Option Price (w) in cash, (x) by delivery of a check payable to the order of the Company, (y) in shares of Common Stock with a fair market value equal to the Option Price or portion thereof being paid with shares (provided, in each instance, that such shares of Common Stock were ownd by the Optionee for at least six months prior to the exercise of the Option, unless such requirement is waived by the Board), or (z) a combination thereof. The Company shall thereafter cause certificates representing the Option Shares purchased to be delivered as promptly as practicable, provided that the Optionee shall pay to the Company at the time of exercise, or shall otherwise make arrangements satisfactory to the Company regarding payment of, any additional amount, if any, as the Company deems necessary to satisfy the Company's liability to withhold Federal, state or local income or other taxes incurred by the Company or the employer of the Optionee by reason of the exercise of the Option, or any portion thereof, or the transfer of the Option Shares thereupon. If requested by the Company, the Optionee shall also deliver this Agreement to the Secretary of the Company who shall endorse hereon a notation of such exercise and return this Agreement to the Optionee. The date of exercise of an Option that is validly exercised shall be deemed to be the date on which there shall have been delivered to the Company the instruments and payments referred to in the first sentence of this paragraph (iii), provided that the Optionee has satisfied or thereafter satisfies the other requirements of this paragraph (iii). The Optionee shall be deemed to be the holder of the Option Shares issued pursuant to the exercise of the Option as of the date of exercise. (iv) For the purposes of the preceding paragraph (iii), "fair market value" per share of Common Stock, as of a particular date, shall mean (x) the closing sales price per share of Common Stock reported on NASDAQ or, if the shares are not so reported, on the system or exchange on which the trading prices of the shares are then reported or traded, (y) if there is no reported closing sales prices per share on such date, the average of the closing bid and asked prices for the shares on such date as reported by NASDAQ or such other system, or (z) if the shares of Common Stock are not then quoted by NASDAQ (or such other system) or traded on one of the exchanges, such value as the Board, in its sole discretion, shall determine. 2. Termination of Employment. (a) Except as provided in this Section 2, Options may not be exercised after the Optionee has ceased to be employed by the Company or a subsidiary of the Company. (b) If the Optionee's employment by the Company or a subsidiary of the Company should terminate for any reason other than dealth, disability (as defined in subparagraph (c) below) or cause (as such term is defined in the Optionee's employment agreement with the Company), the Option may be exercised, to the extent the Optionee was entitled to exercise the Option on the date employment was terminated, at any time within one year after such date, but in no event later than nine years from the Date of Grant. (c) If the Optionee's employment by the Company or a subsidiary of the Company should terminate by reason of the Optionee's death or disability (within the meaning of Section 105(d)(4) of the Internal Revenue Code of 1954, as amended), the Option may be exercised, in its entirety at any time within one year after such date, but in no event later than nine years from the Date of Grant. 3. Non-transferability. The Option granted hereunder shall not be transferable other than by will or by the laws of descent and distribution, and may be exercised, during the lifetime of the Optionee, only by the Optionee or by his guardian or legal representative. 4. Effect of Certain Changes. (a) If there is any change in the aggregate number of issued and outstanding shares of the Common Stock and Company's Limited Duration Class B Common Stock, par value $1 per share ("Class B Stock"; the Common Stock and the Class B Stock are collectively referred to herein as the "Common Equity") through the declaration of stock dividends, or through a recapitalization resulting in stock splits, or combinations or exchanges of such shares, the number of Option Shares and the Option Price per share shall be proportionately adjusted by the Board to reflect any increase or decrease in the number of issued shares of Common Equity; provided, however, that any fractional shares resulting from such adjustment shall be eliminated. (b) In the event of a proposed dissolution or liquidation of the Company, or in the event of any corporate separation or division, including, but not limited to, a split-up, split-off or spin-off, the Board, in its sole discretion, may provide (i) that the Optionee shall have the right to exercise the Option, to the extent then exercisable, solely for the kind and amount of shares of stock and other securities, property, cash or any combination thereof receivable upon such dissolution, liquidation, or corporate separation or division by a holder of the number of shares of Common Stock for which the Option might have been exercised immediately prior to such dissolution, liquidation, or corporate separation or division, or (ii) that the Option shall terminate as of a date to be fixed by the Board, provided however, that not less than twenty days' prior written notice of the date so fixed shall be given to the Optionee, who shall have the right, during the period of twenty days preceding such termination, to exercise the Option as to all or any part of the Option Shares covered thereby, including shares as to which the Option would not otherwise be exercisable, or (iii) for an equitable adjustment in the Option Price. (c) The Board shall, in its sole discretion, in the case of a merger or consolidation in which the Company is not the surviving corporation (i) promptly make an appropriate adjustment to the number and class of shares of Common Stock available pursuant to the Option, to the amount and kind of shares or other securities or property receivable upon the exercise of the Option after the effective date of any such transaction, and/or to the Option Price, or (ii) provide for the cancellation of the Option, or any portion thereof then outstanding, in consideration for a cash payment equal to the product of (x) the difference between the Option Price and the fair market value of the consideration per share received or receivable by holders of Common Equity in any such transaction multiplied by (y) the number of Option Shares then subject to the Option. (d) Paragraphs (b) and (c) of this Section 4 shall not apply to a merger or consolidation in which the Company is the surviving corporation and pursuant to which shares of Common Stock are not converted into or exchanged for stock or securities of any other corporation, cash or any other thing of value. In case of any consolidation or merger of another corporation into the Company in which the Company is the surviving corporation and in which there is a reclassification or change (including a change in the right to receive cash or other property) of the shares of Common Stock (other than a change in par value, or from par value to no par value, or as a result of a subdivision or combination, but including any change in such shares into two or more classes or series of shares), the Board may, in its sole discretion (i) make an appropriate adjustment to the number and class of shares of Common Stock available pursuant to the Option, to the amount and kind of shares or other securities or property receivable upon the exercise of the Option after the effective date of any such transaction, and/or to the Option Price or (ii) provide for the cancellation of the Option, or any portion thereof then outstanding, in consideration for a cash payment equal to the product of (x) the difference between the Option Price and the fair market value of the consideration per share received or receivable by holders of Common Equity in any such transaction multiplied by (y) the number of Option Shares then subject to the Option. (e) In the event of a change in the Common Stock of the Company as presently constituted, which is limited to a change of all of its authorized shares with par value into the same number of shares with a different par value or without par value, the shares resulting from any such change shall be deemed to be the Common Stock within the meaning of the Plan. (f) To the extent that the foregoing adjustments relate to stock or securities of the Company, such adjustments shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. (g) Except as otherwise expressly provided in this Agreement or in the Plan, the Optionee shall have no rights by reason of any subdivision or consolidation of shares of stock of any class or the payment of any stock dividend or any other increase or decrease in the number of shares of stock of any class or by reason of any dissolution, liquidation, merger or consolidation or spin-off of assets or stock of another corporation, and any issue by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Option Shares. The grant of the Option does not affect in any way the right or power of the Company to make adjustments, reclassifications, reorganizations or changes of its capital or business structures or to merge or to consolidate or to dissolve, liquidate or sell, or transfer all or part of its business or assets. 5. Restrictions upon Option Shares. (a) The Optionee, as a condition to the exercise of the Option, by exercising the Option, or any portion thereof, warrants, effective as of the date of exercise, but only to the extent the Option Shares are not being issued pursuant to an effective registration statement on Form S-8 (or any successor form), that (i) the Option Shares are being acquired for investment, for the Optionee's own account, and not with a view to the distribution or resale thereof in violation of the Securities Act of 1933, as amended ("1933 Act"), and (ii) he/she will not sell or transfer any of such shares unless and until (A) a registration statement under the 1933 Act is then in effect covering such shares and the purchaser or transferee thereof has been furnished with a prospectus which complies with the provisions of the 1933 Act, or (B) in the opinion of counsel for the Company, registration under the 1933 Act is not required in connection with the sale or transfer. (b) The Option shall not be exercisable if its exercise would violate any applicable state securities law, any registration provisions or other requirements of the 1933 Act, the Securities Exchange Act of 1934, as amended (or any rules or regulations promulgated under either of such Acts), or any other applicable law, ordinance, rule or regulation. In connection with the foregoing, the Company shall not be obligated to prepare and file (or cause to be prepared and filed), nor take any action to cause to become effective, any registration statement required by applicable law with respect to the issuance of the Option Shares subject to the Option, or any portion thereof, or upon exercise thereof, nor shall the Company be obligated to seek an exemption from any such registration statement requirement. (c) The Company may in its discretion place an appropriate legend or notation on the certificates representing Option Shares issued upon exercise of the Option, or any portion thereof. (d) The Company may instruct any transfer agent for its Common Equity not to transfer any of the Option Shares unless advised by the Company that the provisions of the Plan and this Agreement have been complied with. (e) The Optionee agrees to take any other action which may reasonably be requested by the Company in order to ensure that the Company, by allowing the Optionee to exercise the Option (in whole or in part), will not be in violation of any law or regulation. 6. Agreement Not to Compete. Anything in the Plan or the Agreement to the contrary notwithstanding, if the Optionee, without the written consent of the Company, engages either directly or indirectly, in any manner or capacity, as principal, agent, partner, officer, director, employee or otherwise, in any business or activity competitive with the business conducted by the Company or any subsidiary of the Company, the Option, to the extent not previously exercised, shall expire forthwith. 7. No Employment Agreement. This Agreement shall not be deemed or construed to be an agreement by the Company to employ the Optionee for any specific or non-specific period of time. 8. Notices. Any notice required or permitted under this Agreement shall be deemed given when delivered personally, or when deposited in the United States postal system, postage prepaid, addressed, as appropriate, to Optionee either at his address hereinabove set forth or such other address as he may designate in writing to the Company, or to the Company, at Grey Advertising Inc., 777 Third Avenue, New York, New York 10017, Attention: Corporate Secretary or such other address as the Company may designate in writing to the Optionee. 9. Failure to Enforce Not a Waiver. The failure of the Company to enforce at any time any provision of this Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof. 10. Governing Law. This Agreement shall be governed by and construed according to the laws of the State of Delaware, without regard to the conflicts of law rules thereof. 11. Amendments. This Agreement may be amended or modified at any time by an instrument in writing signed by the parties hereto, provided that no such amendment or modification shall be made which would be inconsistent with the terms of the Plan. IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year above written. GREY ADVERTISING INC. By /s/ Steven G. Felsher __________________________ Executive Vice President /s/ Edward H. Meyer EDWARD H. MEYER EX-99 4 1994 STOCK INCENTIVE PLAN GREY ADVERTISING INC. 1994 STOCK INCENTIVE PLAN 1. PURPOSES The purposes of the Grey Advertising Inc. ("Company") 1994 Stock Incentive Plan ("Plan") are to encourage ownership of the common stock, par value $1 per share ("Common Stock"), of the Company by eligible key employees of the Company and its subsidiaries, and thereby to provide increased incentive for such employees to put forth maximum effort for the success of the business of the Company, and to enable the Company better to attract, retain and reward such employees. Awards under the Plan ("Awards") may be granted in the form of Stock Options ("Options") or restricted stock ("Restricted Stock"), subject to the applicable terms and conditions set forth herein. 2. ADMINISTRATION This Plan shall be administered by a committee ("Committee") of the Board of Directors of the Company consisting of no less than two persons, each of whom is a "disinterested person" within the meaning of Rule 16b-3 ("Rule 16b-3") promulgated under the Securities Exchange Act of 1934, as amended. The Committee is authorized to establish such rules and regulations as it deems necessary for the proper administration of the Plan, and to make such determinations and interpretations and to take such action in connection with the Plan and any options granted under the Plan as it deems necessary or advisable. All determinations of the Committee shall be by a majority of its members and such determinations shall be final. 3. ELIGIBILITY Key employees of the Company and its subsidiaries shall be eligible to receive Awards. Directors of the Company who are not full-time employees of the Company or of any of its subsidiaries shall not be eligible to receive Awards. 4. SHARES AVAILABLE An aggregate of 250,000 shares of Common Stock shall be available for grant of Options and Restricted Stock under the Plan (subject in each case to adjustment as provided in paragraph 9). Such shares may be authorized and unissued shares or may be treasury shares. Upon the expiration, termination or cancellation in whole or in part of any unexercised Options or upon the forfeiture or repurchase by the Company of any shares of Restricted Stock, shares of Common Stock covered by such unexercised Options or forfeited or repurchased shares of Restricted Stock shall be available again for new Awards of Options and Restricted Stock, respectively, under the Plan. No employee may be granted Options for more than 75,000 shares or more than 75,000 shares of Restricted Stock (subject in each case to adjustment as provided in paragraph 9) over the term of the Plan. 5. GRANT OF AWARDS Subject to the provisions of paragraphs 4 and 6, Awards may be granted to such eligible employees in such numbers and at such times during the term of the Plan as the Committee shall determine. Each Award shall be evidenced by a duly executed written agreement by and between the Company and the grantee, containing such other agreements as shall be required by the Committee and as shall not be inconsistent with the Plan. Agreements may contain dissimilar provisions provided that all such provisions are consistent with the Plan. Agreements relating to shares of Restricted Stock shall prescribe the form of legend to be inscribed to the stock certificate evidencing such shares. 6. TERMS AND CONDITIONS OF OPTIONS All Options under the Plan shall be granted subject to the following terms and conditions: (a) Designation. Each Option shall be designated as either an "incentive stock option" (within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code")) or as a "nonqualified stock option". (b) Option Price. The option price shall be not less than 100% of the fair market value of a share of Common Stock, as determined by the Committee, on the date the option is granted; provided, however, that the option price of an "incentive stock option" granted to any individual (a "ten percent shareholder") who owns (within the meaning of Section 422(b)(6) of the Code) stock possessing more than ten percent of the total combined voting power of all classes of stock of the Company or any subsidiary corporation shall not be less than 110% of such fair market value. (c) Duration of Options. Unless sooner terminated by the terms of the Plan or by the terms of any specific grant, each Option shall expire not later than ten years from the date of grant; provided, however, that the maximum term of an "incentive stock option" granted to a ten percent shareholder shall be five years from the date of grant or such longer period as may be permitted by the Code. (d) Exercise of an Option. Options shall be exercisable over their term at such times and in such installments as the Committee may prescribe. Options may be exercised from time to time by written notice to the Company stating the number of shares with respect to which the Option is being exercised. (e) Payment. No shares shall be issued or delivered upon exercise of an Option until full payment for the Option shares has been made in cash, in shares having a fair market value equal to the option price, or in a combination of the foregoing. (f) Nontransferability of Options. An Option shall not be transferable by an optionee except by will or the laws of descent and distribution and shall be exercisable, during the optionee's lifetime, only by the optionee. (g) Termination of Employment. Upon termination of an optionee's employment, each Option previously granted to the optionee shall expire if not exercised before the earlier of (i) the expiration date provided in the option agreement applicable to each such Option and (ii) such earlier date as may be set forth in such option agreement. (h) Non-Competitive Provision. Anything herein to the contrary notwithstanding, if an optionee, without the written consent of the Company, engages either directly or indirectly, in any manner or capacity, as principal, agent, partner, officer, director, employee, or otherwise, in any business or activity competitive with the business conducted by the Company or any subsidiary of the Company, each Option previously granted to the optionee shall expire forthwith. 7. TERMS AND CONDITIONS APPLICABLE TO RESTRICTED STOCK All Awards of Restricted Stock shall be granted subject to the following terms and conditions: (a) Purchase Price. Shares of Restricted Stock may be sold to eligible employees at such purchase price per share as shall be determined by the Committee, or such shares may be awarded and issued without the payment of a purchase price. (b) Conditions to Certain Issuances and Sales. Shares of Restricted Stock may be issued or sold hereunder without the payment of a purchase price (or for a per share purchase price which is less than the then fair market value per share, as determined by the Committee) only if the Corporation's "Earnings" (as hereinafter defined) for its fiscal year prior to the year of such issuance or sale exceed $15,000,000. For purposes hereof, "Earnings" for a particular year shall mean the Company's net income as determined for financial reporting purposes, determined in accordance with generally accepted accounting principles consistently applied, after deduction of all expenses incurred by the Company, but before deduction of any amounts credited for such year under the Company's 1993 Senior Management Incentive Plan (or any successor plan thereto) and any deduction for the provision for taxes on income. In determining Earnings for a particular year, the Committee shall have the authority to make adjustments in recognition of unusual or nonrecurring events affecting the Company or its financial statements, or in response to changes in applicable laws, regulations or accounting principals. (c) Exercise of Rights to Purchase. An employee who is granted the right to purchase shares of Restricted Stock may exercise such right during such period after the time of grant as may be determined by the Committee, provided that he or she is still an employee of the Company or any of its subsidiaries on the date of such exercise. In order to exercise his or her right to purchase shares of Restricted Stock, the employee shall give written notice to the Company of his or her election to purchase and the number of shares he or she is purchasing. The full purchase price of the shares being purchased shall be tendered at the time of such notice in cash or in previously owned shares of Stock. The purchaser shall possess no rights as a stockholder with respect to any purchased shares until he or she has made such full payment and has had issued to him or her a certificate or certificates evidencing the shares so purchased. (d) Restrictions. Shares of Restricted Stock issued to or purchased by an employee under the Plan shall be subject to such restrictions as may be imposed by the Committee at the time of issuance or at the time of the grant of the right to purchase shares. Such restrictions may vary from employee to employee and may also vary among several grants to the same employee. 8. REGULATORY APPROVALS The Company shall not be required to issue any certificate or certificates for shares of Common Stock upon the exercise of an Option or upon the lapsing of restrictions with respect to Restricted Stock prior to (a) the obtaining of any approval from any governmental agency which the Company shall, in its sole discretion, determine to be necessary or advisable and (b) the completion of any registration or other qualification of such shares under any state or Federal law or rulings or regulations of any governmental body which the Company shall, in its sole discretion, determine to be necessary or advisable. 9. ADJUSTMENT OF SHARES AVAILABLE If there is any change in the Common Stock through the declaration of stock dividends, or through recapitalization resulting in stock splits, or combinations or exchanges of shares, or otherwise, the number of shares available for Awards, the maximum number of Options and shares of Restricted Stock which may be granted to any individual, the shares subject to any Award and the option prices applicable to outstanding Options shall be appropriately adjusted by the Committee. 10. AMENDMENT The Board of Directors of the Company may from time to time amend the Plan in any manner which it deems in the best interest of the Company, but may not, without the approval of the Company's Stockholders, adopt any amendment which would cause the Plan to fail to comply with Rule 16b-3. 11. EFFECTIVE DATE OF THE PLAN This Plan shall be effective as from June 27, 1994, provided that the Plan shall have been approved within twelve months of such date by the Stockholders of the Company. In the absence of such Stockholder approval, the Plan (and any Awards theretofore granted) shall be null and void. No Awards may be granted after the tenth anniversary of such effective date. -----END PRIVACY-ENHANCED MESSAGE-----