EXHIBIT A-1
Automatic Data Processing, Inc.
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U.S.A
August 25,1995
Maison Lazard et Cie
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Dear Sirs,
1. Subject to the terms and conditions of this letter, we
hereby offer, irrevocably and with intent to be legally bound, to
purchase, at the price specified in paragraph 5:
(i) all of the shares of GSI Participations SCA
("GPSCA") not held by GSI Associes S.A. ("GA"); and
(ii) all of the shares of GA.
2. The present offer is subject to the condition of the holding
of a meeting of the Board of Directors of GA, to be convened no
later than 7 p.m., Paris time, August 25, 1995, at which said
Board shall:
(i) endorse the present offer;
(ii) convene a meeting of the shareholders of GA to be
held no later than October 6, 1995 for the purpose
of:
- endorsement of the transactions
contemplated herein; and
- amendment of the by-laws of GA to the extent
necessary to implement the transactions
contemplated herein (including if so requested
by ADP the right of GPSCA to replace GA as
associe commandite of GPSCA or to terminate the
commandite arrangement); and
(iii) approve a report to the shareholders which
recommends the approval of the aforesaid
transactions and amendments of the by-laws of GA
referred to in (ii) above.
3. The present offer is subject to the additional condition
that, on or before September 6, 1995, shareholders of GPSCA
representing no less than 67% of the capital of said company
(including all of the Individuals listed in Exhibit A) provide to
ADP:
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3.1 - representations substantially in the form of
Exhibit B;
3.2 - a call option with respect to their shares which,
subject to the provisions of paragraph 11, can be exercised by
ADP at its sole discretion during a period of two years from the
date hereof, at the price defined in paragraph 5 below;
3.3 - in the event of a capital increase of GPSCA,
a commitment either to transfer all of such shareholder's
subscription rights to ADP or to exercise such rights (in
which event the shares issued pursuant to such exercise of
rights will become subject to the aforesaid call option); and
a commitment not to support any capital increase reserved to
a third party;
3.4 - a commitment not to tender their shares to
any third party until the earlier of (i) two years from the
date hereof, or (ii) the listing of GPSCA shares on the cote
officielle or second marche; and
3.5 - in the event of a listing of GPSCA shares as
provided in the preceding subparagraph, a right of first
refusal entitling ADP to acquire said shares (i) at the
listed price on the date upon which said shareholder proposes
to sell such shares, if the shareholder proposes to sell its
shares on the market or (ii) at the price offered by a third
party, if the shareholder proposes to sell its shares to such
third party. Such right of first refusal shall expire two years
following the date hereof.
4. At its aforesaid meeting on August 25, 1995, the Board
of Directors of GA shall undertake on behalf of GA and GPSCA
that:
4.1 neither of such companies shall, directly or
indirectly, enter into any discussion, negotiation or
agreement with any third party pertaining to the sale of any
shares in GA or GPSCA ; and
4.2 each such company shall exercise its best
efforts, to the extent permitted by law, in order to convince
its shareholders to tender their shares to ADP so as to
permit ADP to obtain no less than 67% of the shares of said
company.
5. The aggregate purchase price to be paid by ADP for one
hundred per cent of the equity securities of GA and of all of
the equity securities of GPSCA not held by GA is 2.3 billion
French Francs, it being understood:
5.1 that the respective prices paid for each share
of GA and each share of GPSCA shall be computed by Lazard
Freres & Cie on a proportional basis taking into account GA's
holdings of GPSCA shares, and such determination shall be
definitive and binding on all parties; and
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5.2 that said purchase prices may be adjusted in
accordance with Exhibit C.
Such purchase prices shall be paid to the tendering
shareholder in cash, immediately upon surrender of the
relevant shares minus the advisory fee payable to Maison
Lazard & Cie pursuant to its engagement agreement with GPSCA
(the relevant terms of which shall be communicated to ADP by
GPSCA), which fee shall be withheld from such payment and
paid directly to Maison Lazard & Cie.
6. ADP undertakes to exercise its best efforts in order to
obtain promptly all governmental approvals necessary in order
to consummate the transactions discussed herein. ADP
represents that it is duly authorized to carry out the
transactions herein contemplated without any further action
by its Board of Directors or any other body of ADP.
7. Subject only to ADP's receipt of governmental approvals
as provided in paragraph 6, to favorable action by the Board
of Directors and the shareholders of GA and GPSCA as provided
in paragraphs 2 and 3 above, and to the provisions of
paragraph 11, ADP shall purchase at the price defined in
paragraph 5 all of the shares of GA and GPSCA that are
tendered to it within 30 days of fulfillment of the last of
such conditions. In the event that such 30 day period does
not commence until after November 15, 1995 (otherwise than as
a result of ADP's failure to secure such governmental
approvals on or before such date), ADP's obligations shall be
subject to the additional condition that there shall have
been no material adverse change affecting the business or
financial condition of GPSCA between the date hereof and the
date of commencement of such 30-day period.
8. If the shareholders of GA fail to vote favorably any of
the resolutions contemplated in paragraph 2 above, ADP shall
nonetheless be required to offer to purchase at the price
provided for in paragraph 5 all of the GA shares and all of
the GPSCA shares not held by GA provided only that:
8.1 GA ceases to be the associe commandite of
GPSCA at any time within the two year period following the
date hereof;
8.2 there shall have been no material adverse
change affecting the business or financial condition of GPSCA
between the date hereof and the date of termination of GA's
status as associe commandite of GPSCA, it being understood
that, subject to the provisions of paragraph 11, ADP shall be
required to purchase all shares tendered during the period of
90 days following the date of such termination of GA's status
as associe commandite effective as of the last day of such
period;
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8.3 the obligation of ADP to acquire the GA shares
under this paragraph 8 shall be subject to the additional
conditions that (i) GA shall have adopted the amendments to
its by-laws necessary in order to make such acquisition
possible and that (ii) a majority of the shares of GA are
tendered to ADP prior to expiration of such 90-day period. In
the event that either of such conditions is not satisfied
within such period, ADP shall have no further obligation with
respect to the GA shares but shall continue to be obligated
to acquire the GPSCA shares as provided elsewhere herein.
9. Until the date of the shareholders' meeting of GA
contemplated in paragraph 2 or, if the GA shareholders adopt
at the said meeting the resolutions contemplated in said
paragraph 2, until the end of the 30-day period mentioned in
paragraph 7, GA and GPSCA and all companies directly or
indirectly under their control shall be managed in the
ordinary course of business only and shall refrain (i) from
purchasing or selling any substantial asset outside of the
ordinary course of business (with the exception of the
Businesses listed in Table 1 of Exhibit C), (ii) from
modifying their respective bylaws or capital structure in any
respect whatsoever (except as provided for herein), and (iii)
from deciding any distribution of dividends and/or assets,
except as permitted pursuant to paragraph 10. GA and GPSCA
shall, until completion of all actions contemplated herein,
keep ADP informed of all steps taken by GA and GPSCA to meet
the conditions set forth herein, and shall provide to ADP
copies of their respective management accounts and of all
audited accounts.
10. There shall be no declaration or distribution of
dividends by GPSCA in excess of the amount mandated under
article 29 of GPSCA's statutes (as presently in effect)
without the prior consent of ADP prior to expiration of the
period of two years from the date hereof, it being
understood, however, that ADP acknowledges and accepts the
advance on dividends paid in July 1995.
11. ADP agrees not to make any purchase of GA or GPSCA
shares outside the 30-day period specified in paragraph 7 and
the 90-day period specified in paragraph 8 without the prior
consent of Lazard Freres & Cie, which shall not be withheld
unless the effect of such proposed sale outside such periods
would, in the discretionary judgement of Lazard Freres & Cie,
be to distort the price adjustment computation contemplated
in Exhibit C. Notwithstanding any other provisions of this
letter, ADP agrees not to cause either of such periods to
commence prior to October 16, 1995 without the consent of
GPSCA.
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12. This offer shall be governed by and interpreted in
accordance with French law.
Signed in 5 originals.
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Corporate Vice President,
Chief Financial Officer
G. ▇▇▇▇▇ ▇▇▇▇▇▇
Corporate Vice President,
Worldwide Business Development
EXHIBIT A
Individuals
Jacques Valet
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Andoni Itturioz
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EXHIBIT B
Representations of certain sellers of HPSCA shares
1. The seller is the sole owner of the HPSCA shares transferred by
it. All such shares are free and clear of all liens and other
encumbrances. The seller is not bound by any agreement limiting
seller's right to transfer the shares to ADP.
2. The seller has full capacity to transfer the shares. The seller
has obtained all third party consents required in order for the
shares to be validly transferred to ADP (other than governmental
authorizations, which shall be the sole responsibility of ADP).
EXHIBIT C
Purchase price adjustment mechanism
A purchase price adjustment shall be computed by Lazard
Freres & Cie, as of the earliest of (i) the first day of the 30-
day period specified in paragraph 7, (ii) the first day of the
90-day period specified in paragraph 8, and (iii), subject to
paragraph 11, the first acquisition of any GA or GPSCA shares by
ADP (the "Adjustment Date") as follows.
The aggregate purchase price shall be increased by any
aggregate surplus and reduced by any aggregate shortfall between
(i) net alter tax proceeds from the divestiture of the Businesses
set out below in Table 1 which have been divested prior to such
Adjustment Date; and (ii) their respective Estimated Values set
out below in Table 1.
Said purchase price shall also be reduced by 33% of the
aggregate Estimated Values set out below in Table 1 for the
Businesses which have not been divested as of the Adjustment
Date, provided, however, that in respect of any Business which,
as of the Adjustment Date, has not been divested but is the
subject of a binding divestiture agreement (including such an
agreement that is conditional upon customary closing conditions
such as governmental approvals), the rate of reduction shall be
15% in lieu of 33%.
Table 1
Businesses Estimated Value
Transport & Tourisme FFr. 7 million
Technologies Avancees ▇▇▇. ▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇. 6 million
MSS ▇▇▇. ▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇. 4 million
Total FFr. 118 million
The price shall also be increased by the amount of any
proceeds payable to GPSCA or GA in consideration of any shares
issued pursuant to any options that may have been issued and
remain outstanding as of the date hereof, insofar as such shares
are required to be taken into account as "equity securities" for
purposes of computing prices per share pursuant to paragraph 5.
Any adjustments made by Lazard Freres & Cie shall be
definitive and binding on all parties.
