UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13G/A
(Rule 13D-102)
Under the Securities Exchange Act of 1934
(Amendment No. 4)
STMicroelectronics N.V.
--------------------------------------------------------------------------------
(Name of Issuer)
Common Shares, nominal value (euro) 1.04 per share
--------------------------------------------------------------------------------
(Title of Class of Securities)
861012102
--------------------------------------------------------------------------------
(CUSIP Number)
December 31, 2003
--------------------------------------------------------------------------------
(Date of Event Which Requires Filing of this Statement)
Check the appropriate box to designate the rule pursuant to which this
Schedule is filed:
[ ] Rule 13d-1 (b)
[ ] Rule 13d-1 (c)
[X] Rule 13d-1 (d)
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter the
disclosures provided in a prior cover page.
The information required in the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
(Continued on following pages)
Page 1 of 28
CUSIP No. 861012102 13G Page 2 of 28 Pages
--------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
STMicroelectronics Holding II B.V. ("ST Holding II")
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [X]
(b) [ ]
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 CITIZENSHIP OR PLACE OF ORGANIZATION
The Netherlands
--------------------------------------------------------------------------------
5 SOLE VOTING POWER
NUMBER OF
SHARES NONE
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
--------------------------------------------------------------------------------
6 SHARED VOTING POWER
34.5%* (See Item 4(a) and Exhibit 1)
--------------------------------------------------------------------------------
7 SOLE DISPOSITIVE POWER
NONE
--------------------------------------------------------------------------------
8 SHARED DISPOSITIVE POWER
34.5%* (See Item 4(a) and Exhibit 1)
--------------------------------------------------------------------------------
9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
311,483,280**
--------------------------------------------------------------------------------
10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES*
[ ]
--------------------------------------------------------------------------------
11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
34.5%*
--------------------------------------------------------------------------------
12 TYPE OF REPORTING PERSON*
HC
--------------------------------------------------------------------------------
* Based upon 902,741,214 common shares outstanding as of December 31, 2003 as
shown on the STMicroelectronics N.V.'s share registry.
** Based upon (i) 235,059,876 common shares held of record by ST Holding II on
STMicroelectronics N.V.'s share registry; (ii) 30,000,000 common shares held of
record by BNP-Paribas Securities Services (France) as Escrow Agent for ST
Holding II and France Telecom in connection with the issuance of France
Telecom's 1.0% exchangeable notes due December 17, 2004, exchangeable for common
shares of STMicroelectronics N.V.; (iii) 26,423,404 common shares held of record
by Societe Generale as Escrow Agent for ST Holding II and France Telecom in
connection with the issuance of France Telecom's 6 3/4% notes due August 6, 2005
mandatorily exchangeable for shares of STMicroelectronics N.V.; and (iv)
20,000,000 common shares held by BNP-Paribas Securities Services (Luxembourg) as
Escrow Agent for Finmeccanica Finance S.p.A. in connection with its issuance of
0.375% notes exchangeable for shares of STMicroelectronics N.V.
CUSIP No. 861012102 13G Page 3 of 28 Pages
--------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
STMicroelectronics Holding N.V. ("ST Holding")
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [X]
(b) [ ]
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 CITIZENSHIP OR PLACE OF ORGANIZATION
The Netherlands
--------------------------------------------------------------------------------
5 SOLE VOTING POWER
NUMBER OF
SHARES NONE
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
--------------------------------------------------------------------------------
6 SHARED VOTING POWER
34.5%* (See Item 4(a) and Exhibit 1)
--------------------------------------------------------------------------------
7 SOLE DISPOSITIVE POWER
NONE
--------------------------------------------------------------------------------
8 SHARED DISPOSITIVE POWER
34.5%* (See Item 4(a) and Exhibit 1)
--------------------------------------------------------------------------------
9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
311,483,280**
--------------------------------------------------------------------------------
10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES*
[ ]
--------------------------------------------------------------------------------
11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
34.5%*
--------------------------------------------------------------------------------
12 TYPE OF REPORTING PERSON*
HC
--------------------------------------------------------------------------------
* Based upon 902,741,214 common shares outstanding as of December 31, 2003 as
shown on STMicroelectronics N.V.'s share registry.
** Based upon (i) 235,059,876 common shares held of record by ST Holding II on
STMicroelectronics N.V.'s share registry; (ii) 30,000,000 common shares held of
record by BNP-Paribas Securities Services (France) as Escrow Agent for ST
Holding II and France Telecom in connection with the issuance of France
Telecom's 1.0% exchangeable notes due December 17, 2004, exchangeable for common
shares of STMicroelectronics N.V.; (iii) 26,423,404 common shares held of record
by Societe Generale as Escrow Agent for ST Holding II and France Telecom in
connection with the issuance of France Telecom's 6 3/4% notes due August 6, 2005
mandatorily exchangeable for shares of STMicroelectronics N.V.; and (iv)
20,000,000 common shares held by BNP-Paribas Securities Services (Luxembourg) as
Escrow Agent for Finmeccanica Finance S.p.A. in connection with its issuance of
0.375% notes exchangeable for shares of STMicroelectronics N.V.
CUSIP No. 861012102 13G Page 4 of 28 Pages
--------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
FT1CI
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [X]
(b) [ ]
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 CITIZENSHIP OR PLACE OF ORGANIZATION
The Republic of France
--------------------------------------------------------------------------------
5 SOLE VOTING POWER
NUMBER OF
SHARES NONE
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
--------------------------------------------------------------------------------
6 SHARED VOTING POWER
34.5%* (See Item 4(a) and Exhibit 1)
--------------------------------------------------------------------------------
7 SOLE DISPOSITIVE POWER
NONE
--------------------------------------------------------------------------------
8 SHARED DISPOSITIVE POWER
34.5%* (See Item 4(a) and Exhibit 1)
--------------------------------------------------------------------------------
9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
311,483,280**
--------------------------------------------------------------------------------
10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES*
[ ]
--------------------------------------------------------------------------------
11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
34.5%*
--------------------------------------------------------------------------------
12 TYPE OF REPORTING PERSON*
HC
--------------------------------------------------------------------------------
* Based upon 902,741,214 common shares outstanding as of December 31, 2003 as
shown on STMicroelectronics N.V.'s share registry.
** Based upon (i) 235,059,876 common shares held of record by ST Holding II on
STMicroelectronics N.V.'s share registry; (ii) 30,000,000 common shares held of
record by BNP-Paribas Securities Services (France) as Escrow Agent for ST
Holding II and France Telecom in connection with the issuance of France
Telecom's 1.0% exchangeable notes due December 17, 2004, exchangeable for common
shares of STMicroelectronics N.V.; (iii) 26,423,404 common shares held of record
by Societe Generale as Escrow Agent for ST Holding II and France Telecom in
connection with the issuance of France Telecom's 6 3/4% notes due August 6, 2005
mandatorily exchangeable for shares of STMicroelectronics N.V.; and (iv)
20,000,000 common shares held by BNP-Paribas Securities Services (Luxembourg) as
Escrow Agent for Finmeccanica Finance S.p.A. in connection with its issuance of
0.375% notes exchangeable for shares of STMicroelectronics N.V.
CUSIP No. 861012102 13G Page 5 of 28 Pages
--------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Finmeccanica S.p.A. ("Finmeccanica")
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [X]
(b) [ ]
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 CITIZENSHIP OR PLACE OF ORGANIZATION
The Republic of Italy
--------------------------------------------------------------------------------
5 SOLE VOTING POWER
NUMBER OF
SHARES NONE
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
--------------------------------------------------------------------------------
6 SHARED VOTING POWER
34.5%* (See Item 4(a) and Exhibit 1)
--------------------------------------------------------------------------------
7 SOLE DISPOSITIVE POWER
NONE
--------------------------------------------------------------------------------
8 SHARED DISPOSITIVE POWER
34.5%* (See Item 4(a) and Exhibit 1)
--------------------------------------------------------------------------------
9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
311,483,280**
--------------------------------------------------------------------------------
10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES*
[ ]
--------------------------------------------------------------------------------
11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
34.5%*
--------------------------------------------------------------------------------
12 TYPE OF REPORTING PERSON*
HC
--------------------------------------------------------------------------------
* Based upon 902,741,214 common shares outstanding as of December 31, 2003 as
shown on STMicroelectronics N.V.'s share registry.
** Based upon (i) 235,059,876 common shares held of record by ST Holding II on
STMicroelectronics N.V.'s share registry; (ii) 30,000,000 common shares held of
record by BNP-Paribas Securities Services (France) as Escrow Agent for ST
Holding II and France Telecom in connection with the issuance of France
Telecom's 1.0% exchangeable notes due December 17, 2004, exchangeable for common
shares of STMicroelectronics N.V.; (iii) 26,423,404 common shares held of record
by Societe Generale as Escrow Agent for ST Holding II and France Telecom in
connection with the issuance of France Telecom's 6 3/4% notes due August 6, 2005
mandatorily exchangeable for shares of STMicroelectronics N.V.; and (iv)
20,000,000 common shares held by BNP-Paribas Securities Services (Luxembourg) as
Escrow Agent for Finmeccanica Finance S.p.A. in connection with its issuance of
0.375% notes exchangeable for shares of STMicroelectronics N.V.
CUSIP No. 861012102 13G Page 6 of 28 Pages
--------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Societe des Participations CEA (commercially known as "Areva", formerly
known as CEA-Industrie)
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [X]
(b) [ ]
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 CITIZENSHIP OR PLACE OF ORGANIZATION
The Republic of France
--------------------------------------------------------------------------------
5 SOLE VOTING POWER
NUMBER OF
SHARES NONE
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
--------------------------------------------------------------------------------
6 SHARED VOTING POWER
34.5%* (See Item 4(a) and Exhibit 1)
--------------------------------------------------------------------------------
7 SOLE DISPOSITIVE POWER
NONE
--------------------------------------------------------------------------------
8 SHARED DISPOSITIVE POWER
34.5%* (See Item 4(a) and Exhibit 1)
--------------------------------------------------------------------------------
9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
311,483,280**
--------------------------------------------------------------------------------
10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES*
[ ]
--------------------------------------------------------------------------------
11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
34.5%*
--------------------------------------------------------------------------------
12 TYPE OF REPORTING PERSON*
CO
--------------------------------------------------------------------------------
* Based upon 902,741,214 common shares outstanding as of December 31, 2003 as
shown on STMicroelectronics N.V.'s share registry.
** Based upon (i) 235,059,876 common shares held of record by ST Holding II on
STMicroelectronics N.V.'s share registry; (ii) 30,000,000 common shares held of
record by BNP-Paribas Securities Services (France) as Escrow Agent for ST
Holding II and France Telecom in connection with the issuance of France
Telecom's 1.0% exchangeable notes due December 17, 2004, exchangeable for common
shares of STMicroelectronics N.V.; (iii) 26,423,404 common shares held of record
by Societe Generale as Escrow Agent for ST Holding II and France Telecom in
connection with the issuance of France Telecom's 6 3/4% notes due August 6, 2005
mandatorily exchangeable for shares of STMicroelectronics N.V.; and (iv)
20,000,000 common shares held by BNP-Paribas Securities Services (Luxembourg) as
Escrow Agent for Finmeccanica Finance S.p.A. in connection with its issuance of
0.375% notes exchangeable for shares of STMicroelectronics N.V.
CUSIP No. 861012102 13G Page 7 of 28 Pages
--------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
France Telecom
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [X]
(b) [ ]
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 CITIZENSHIP OR PLACE OF ORGANIZATION
The Republic of France
--------------------------------------------------------------------------------
5 SOLE VOTING POWER
NUMBER OF
SHARES NONE
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
--------------------------------------------------------------------------------
6 SHARED VOTING POWER
34.5%* (See Item 4(a) and Exhibit 1)
--------------------------------------------------------------------------------
7 SOLE DISPOSITIVE POWER
NONE
--------------------------------------------------------------------------------
8 SHARED DISPOSITIVE POWER
34.5%* (See Item 4(a) and Exhibit 1)
--------------------------------------------------------------------------------
9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
311,483,280**
--------------------------------------------------------------------------------
10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES*
[ ]
--------------------------------------------------------------------------------
11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
34.5%*
--------------------------------------------------------------------------------
12 TYPE OF REPORTING PERSON*
CO
--------------------------------------------------------------------------------
* Based upon 902,741,214 common shares outstanding as of December 31, 2003 as
shown on STMicroelectronics N.V.'s share registry.
** Based upon (i) 235,059,876 common shares held of record by ST Holding II on
STMicroelectronics N.V.'s share registry; (ii) 30,000,000 common shares held of
record by BNP-Paribas Securities Services (France) as Escrow Agent for ST
Holding II and France Telecom in connection with the issuance of France
Telecom's 1.0% exchangeable notes due December 17, 2004, exchangeable for common
shares of STMicroelectronics N.V.; (iii) 26,423,404 common shares held of record
by Societe Generale as Escrow Agent for ST Holding II and France Telecom in
connection with the issuance of France Telecom's 6 3/4% notes due August 6, 2005
mandatorily exchangeable for shares of STMicroelectronics N.V.; and (iv)
20,000,000 common shares held by BNP-Paribas Securities Services (Luxembourg) as
Escrow Agent for Finmeccanica Finance S.p.A. in connection with its issuance of
0.375% notes exchangeable for shares of STMicroelectronics N.V.
CUSIP No. 861012102 13G Page 8 of 28 Pages
Item 1(a). Name of Issuer:
STMicroelectronics N.V. (the "Company")
Item 1(b). Address of Issuer's Principal Executive Offices:
STMicroelectronics N.V.
39, chemin du champ des filles
1228 Plan-Les-Ouates
Geneva, Switzerland
Item 2(a). Name of Persons Filing:
The current members of the Group of STMicroelectronics N.V.
shareholders consisting of:
(i) ST Holding II
(ii) ST Holding
(iii) FT1CI
(iv) Finmeccanica
(v) Societe des Participations CEA (commercially known as
"Areva")
(vi) France Telecom
Item 2(b). Address of Principal Business Office, or if none, Residence:
(i) STMicroelectronics Holding II B.V.
"Weenatoren" 2d floor
Weena 327, 329
3013 AL Rotterdam
The Netherlands
(ii) STMicroelectronics Holding N.V.
"Weenatoren" 2d floor
Weena 327, 329
3013 AL Rotterdam
The Netherlands
(iii) FT1CI
27-29, rue Le Peletier
75433 Paris Cedex 09
France
(iv) Finmeccanica S.p.A.
Piazza Monte Grappa, 4
00195 Rome
Italy
CUSIP No. 861012102 13G Page 9 of 28 Pages
(v) Societe des Participations CEA (commercially known as
"Areva")
27-29, rue Le Peletier
75433 Paris Cedex 09
France
(vi) France Telecom
6, place d'Alleray
75505 Paris Cedex 15
France
Item 2(c). Citizenship:
(i) The Netherlands
(ii) The Netherlands
(iii) The Republic of France
(iv) The Republic of Italy
(v) The Republic of France
(vi) The Republic of France
Item 2(d). Title of Class of Securities:
Common Shares, nominal value (euro) 1.04 per Share
Item 2(e). CUSIP Number:
861012102
Item 3. Item 3 is not applicable.
Item 4(a). Amount Beneficially Owned:
311,483,280 shares of common stock are beneficially owned by
ST Holding II. These amounts are held of record on
STMicroelectronics N.V.'s share registry as follows:
(i) 235,059,876 common shares held of record by ST Holding
II on STMicroelectronics N.V.'s share registry;
(ii) 30,000,000 common shares held of record by BNP-Paribas
Securities Services (France) as Escrow Agent for ST
Holding II and France Telecom in connection with the
issuance of France Telecom's 1.0%
CUSIP No. 861012102 13G Page 10 of 28 Pages
exchangeable notes due December 17, 2004, exchangeable
for common shares of STMicroelectronics N.V.;
(iii) 26,423,404 common shares held of record by Societe
Generale as Escrow Agent for ST Holding II and France
Telecom in connection with the issuance of France
Telecom's 6 3/4% notes due August 6, 2005 mandatorily
exchangeable for shares of STMicroelectronics N.V.; and
(iv) 20,00,000 common shares held by BNP-Paribas Securities
Services (Luxembourg) as Escrow Agent for Finmeccanica
Finance S.p.A. in connection with its issuance of 0.375%
notes exchangeable for shares of STMicroelectronics N.V.
ST Holding II retains all voting rights related to common
shares in escrow, and if the France Telecom or Finmeccanica
exchangeable notes are not redeemed for STMicroelectronics
N.V. common shares, the common shares will be released from
escrow.
ST Holding II is a wholly owned subsidiary of
STMicroelectronics Holding N.V. which is jointly controlled by
FT1CI and Finmeccanica. (See Exhibit 1, attached hereto.)
Item 4(b). Percent of Class:
34.5% based upon 902,741,214 common shares outstanding as of
December 31, 2003 as shown on STMicroelectronics N.V.'s share
registry.
Item 4(c). Number of shares as to which such person has:
Please see Items 5, 6, 7, 8, 9 and 11 of each cover sheet for
each filing entity.
Item 5. Ownership of Five Percent or Less of a Class
If this statement is being filed to report the fact that as of
the date hereof the reporting person has ceased to be the
beneficial owner of more than five percent of the class of
Securities, check the following [ ].
Item 6. Ownership of More than Five Percent on Behalf of Another
Person
Item 6 is not applicable.
Item 7. Identification and Classification of the Subsidiary Which
Acquired the Security Being Reported on By the Parent Holding
Company
Item 7 is not applicable.
CUSIP No. 861012102 13G Page 11 of 28 Pages
Item 8. Identification and Classification of Members of a Group
See attached Exhibit 1 for the identity of each member of the
Group and a description of relevant shareholders' agreements.
See also, Item 4(a) above.
Item 9. Notice of Dissolution of Group
Item 9 is not applicable.
Item 10. Certification
Item 10 is not applicable.
CUSIP No. 861012102 13G Page 12 of 28 Pages
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.
By: STMicroelectronics Holding N.V., by and on behalf of STMicroelectronics
Holding II B.V., as Managing Member
-------------------------- --------------------------
(Date) (Date)
-------------------------- --------------------------
(Signature) (Signature)
Name: Umberto d'Agostino Name: Bertrand Loubert
Title: Managing Director, Title: Managing Director,
STMicroelectronics Holding N.V. STMicroelectronics Holding N.V.
CUSIP No. 861012102 13G Page 13 of 28 Pages
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.
By: STMicroelectronics Holding N.V.
-------------------------- --------------------------
(Date) (Date)
-------------------------- --------------------------
(Signature) (Signature)
Name: Umberto d'Agostino Name: Bertrand Loubert
Title: Managing Director Title: Managing Director
CUSIP No. 861012102 13G Page 14 of 28 Pages
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.
By: FT1CI
--------------------------
(Date)
--------------------------
(Signature)
Name: Bertrand Loubert
Title: Legal Director
CUSIP No. 861012102 13G Page 15 of 28 Pages
--------------------------------------------------------------------------------
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.
By: Finmeccanica S.p.A.
--------------------------
(Date)
--------------------------
(Signature)
Name: Roberto Testore
Title: Chief Executive Officer and
General Manager
Page 16 of 28 Pages
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.
By: Societe des Participations CEA (commercially known as "Areva")
--------------------------
(Date)
--------------------------
(Signature)
Name: Gerald Arbola
Title: Member of the Managing Board and
Chief Financial Officer
CUSIP No. 861012102 13G Page 17 of 28 Pages
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.
By: France Telecom
--------------------------
(Date)
--------------------------
(Signature)
Name: Bernard Izerable
Title: Senior Vice President, M&A
CUSIP No. 861012102 13G Page 18 of 28 Pages
EXHIBIT 1
Major Shareholders
STMicroelectronics Holding II B.V. ("ST Holding II") is a wholly owned
subsidiary of STMicroelectronics Holding N.V. ("ST Holding"). As of December 31,
2003, based on voting and economic interests, FT1CI and Finmeccanica held
exactly 50% each of ST Holding. FT1CI consists of two principal French
shareholders, France Telecom, the French state-controlled telecommunications
company, and Societe des Participations CEA (commercially known as "Areva",
formerly known as CEA-Industrie), a corporation controlled by the French atomic
energy commission. Finmeccanica is an Italian holding company owned by both the
Italian Ministero dell'Economia e delle Finanze ("the Italian Ministry of
Economics and Finance"), which controls important actions of Finmeccanica due to
its significant holding in it, and the public. Finmeccanica is listed on the
Italian Mercato Telematico Azionario ("Telematico") and is included in the MIB
30 stock index. The Italian Ministry of Economics and Finance has appointed a
majority of the members of Finmeccanica's board of directors and pursuant to the
provisions of its articles of association and Italian law, retains veto rights
over certain major transactions involving Finmeccanica. The shares of France
Telecom are listed on Euronext Paris and its American Depositary Receipts on the
New York Stock Exchange. Certificats d'investissement of Areva are listed on
Euronext Paris.
ST Holding owned 90% of the Company's shares before the Company's
initial public offering in 1994, and has since then gradually reduced its
participation, going below the 66% threshold in 1997 and below the 50% threshold
in 1999. ST Holding may further dilute its shares as provided below in
"--Shareholders' agreements--2001 Shareholders' agreement--Disposals of the
Company's Common Shares" and pursuant to the eventual conversion of the
Company's outstanding convertible instruments.
Set forth below is a table of ST Holding II's holdings in the Company
as of the end of each of the past three financial years:
Common SharesOwned
------------------
Number %
------ -
December 31, 2003 311,483.280 34.5
December 31, 2002 320,483.280 35.6
December 31, 2001 389,483.280 36.2
CUSIP No. 861012102 13G Page 19 of 28 Pages
The chart below illustrates the shareholding structure as of December
31, 2003, without giving effect to the potential exchanges of shareholder
exchangeable bonds for Company shares, which may occur from January 2, 2004:
French Shareholders Italian Shareholders
------------- ---------------- ------------------------------- --------
Areva Group France Telecom Italian Ministry of Economics Public
and Finance
------------- ---------------- ------------------------------- --------
63.8% | | 36.2% 32.3% | | 67.7%
| | | |
-------------- -------------- |
FT1CI Finmeccanica -------
-------------- --------------
| |
| |
| ---------------- |
50% ------------------ ST Holding ------------- 50%
----------------
|
| 100%
---------------- --------------
ST Holding II Public
---------------- --------------
| |
| 34.5% 65.5% |
-------------------------
STMicroelectronics N.V.
-------------------------
On December 17, 2001, France Telecom issued (euro)1,522,950,000
aggregate principal amount of 1.0% notes due December 17, 2004, redeemable by
way of exchange for up to 30 million of the Company's existing common shares on
or after January 2, 2004. On July 30, 2002, France Telecom finalized the private
placement to institutional investors of (euro)442.2 million of 6 3/4% notes due
August 6, 2005, mandatorily exchangeable into the Company's existing common
shares held by France Telecom. France Telecom's 6 3/4% notes are exchangeable
for the Company's common shares from January 2, 2004 and the number of shares
that France Telecom will deliver to the holders of the notes is a maximum of
26.42 million shares and a minimum of 20.13 million shares, depending on the
price of the Company's shares at maturity.
On August 12, 2003, Finmeccanica Finance S.A., a subsidiary of
Finmeccanica, issued (euro)438,725,000 aggregate principal amount of 0.375%
senior unsecured exchangeable notes due 2010, guaranteed by Finmeccanica (the
"Finmeccanica notes"). On September 2, 2003, Finmeccanica Finance S.A. issued an
additional (euro)62,675,000 of Finmeccanica notes, raising the issue size to
(euro)501,400,000. The Finmeccanica notes are exchangeable beginning on January
2, 2004 into up to 20 million of the Company's existing common shares held by ST
Holding II, or 2.3% of its then-outstanding share capital. During the second
half of 2003, ST Holding II sold on the market a total of nine million shares,
or approximately 0.99% of the Company's issued and outstanding common shares.
The sales were made as permitted by the shareholders' agreement dated December
10, 2001, in compliance with current stock exchange regulations, and
corresponded to indirect shareholdings held by Finmeccanica.
CUSIP No. 861012102 13G Page 20 of 28 Pages
Pursuant to the terms and conditions of France Telecom's 1.0%
exchangeable notes, on February 6, 2004, France Telecom notified the holders of
its 1.0% notes of its decision to redeem the notes. When successfully completed,
on March 9, 2004, the shares underlying France Telecom's 1.0% exchangeable notes
held in escrow by BNP Paribas Securities Services (France) will be released from
escrow.
Following the recent sales by Finmeccanica, and assuming the France
Telecom 1.0% notes are redeemed by France Telecom in their entirety on March 9,
2004, the France Telecom 6 3/4% notes are exchanged for the Company's common
shares at the maximum exchange ratio, and that the Finmeccanica 0.375% notes are
exchanged for the Company's common shares at the initial exchange ratio, ST
Holding II would own approximately 29.4% of the Company's issued common shares.
Making the same assumptions, Finmeccanica's actual indirect interest in the
Company's shares would be approximately 15.0% and FT1CI's actual direct interest
would be approximately 14.3%, consisting of an Areva stake of approximately
11.0% and a France Telecom stake of approximately 3.3%.
Shareholders Agreements
In connection with the Company's formation, Thomson-CSF (now called
Thales) and STET (now called Telecom Italia S.p.A.) as the Company's
shareholders, entered into a shareholders' agreement on April 30, 1987 (as
amended, the "Holding Shareholders' agreement"). The current parties to the
Holding Shareholders' agreement are FT1CI and Finmeccanica.
The Holding Shareholders' agreement contemplates that the parties
shall agree upon common proposals and jointly exercise their powers of decision
and their full control of the strategies and actions of ST Holding and the
Company. Under the Holding Shareholders' agreement, the Supervisory Board of ST
Holding, which "presently is composed of three representatives of FT1CI and four
representatives of Finmeccanica, and the Company's Supervisory Board, each one
within its respective sphere of competence, must give their respective prior
approval before ST Holding may vote in favor of a resolution that the Company or
any of its subsidiaries may: (i) modify the Company's articles of incorporation;
(ii) change the Company's authorized share capital, issue, acquire or dispose of
the Company's shares, change any shareholder rights or issue any instruments
granting an interest in the Company's capital or profits; (iii) be liquidated or
dispose of all or a substantial and material part of the Company's assets or any
shares the Company holds in any of the Company's subsidiaries; (iv) enter into
any merger, acquisition or joint venture agreement (and, if substantial and
material, any agreement relating to intellectual property) or form a new
company; (v) approve such company's draft consolidated balance sheets and
financial statements or any profit distribution by such company; or (vi) enter
into any agreement with any of the direct or indirect ST Holding shareholders
outside the normal course of the Company's business. The Holding Shareholders'
agreement also provides that long-term business plans and annual budgets for the
Company and its subsidiaries, as well as any significant modifications thereto,
shall be approved in advance by the Supervisory Board of each of ST Holding and
the Company, each one within its respective sphere of competence. In addition,
the Supervisory Board of ST Holding shall also decide upon operations of
CUSIP No. 861012102 13G Page 21 of 28 Pages
exceptional importance contained in the annual budget even after financing
thereof shall have been approved.
Pursuant to the terms of the Holding Shareholders' agreement, neither
the Company nor ST Holding are permitted, as a matter of principle, to operate
outside the field of semiconductor products. The parties to the Holding
Shareholders' agreement also undertake to refrain directly or indirectly from
competing with the Company in the area of semiconductor products, subject to
certain exceptions, and to offer the Company opportunities to commercialize or
invest in any semiconductor product developments by them. Any financing or
capital provided by the parties to ST Holding or the Company is intended to be
provided pro rata based on the parties' respective shareholdings in ST Holding.
See further details below.
The admission of a third party to the share capital of ST Holding,
whether through the sale of ST Holding's outstanding shares or through the issue
by ST Holding of new shares, or by any other means, must be unanimously agreed
upon. In the event of a disagreement that cannot be resolved between the parties
as to the conduct of the business and actions contemplated by the Holding
Shareholders' agreement, each party has the right to offer its interest in ST
Holding to the other, which then has the right to acquire, or to have a third
party acquire, such interest. If neither party agrees to acquire or have
acquired the other party's interest, then together the parties are obligated to
try to find a third party to acquire their collective interests, or such part
thereof as is suitable to change the decision to terminate the agreement. The
Holding Shareholders' agreement otherwise terminates in the event that one of
the parties thereto ceases to hold shares in ST Holding.
Pursuant to the terms of the Holding Shareholders' agreement and for
the duration of such agreement, FT1CI, on the one hand, and Finmeccanica, on the
other hand, have agreed to maintain equal interests in the Company's share
capital. See further details below.
2001 Shareholders Agreement
On December 10, 2001, FT1CI, Finmeccanica, France Telecom and Areva
signed an amendment to the ST Holding shareholders' agreement (the "2001
shareholders' agreement") to restructure their holdings in ST Holding. The
agreement permits the shareholders to (i) restructure the holding companies as
desirable, (ii) provide for new corporate governance principles, (iii) provide
for the terms and conditions of disposals of the Company's common shares and
(iv) ensure stability in the shareholding structure and future flexibility. To
the extent the 2001 shareholders' agreement conflicts with existing agreements
among the shareholders, the provisions of the 2001 shareholders' agreement shall
prevail.
Restructuring of the Holding Companies
If necessary, the parties agreed to restructure the two holding
companies (ST Holding and ST Holding II) to simplify the structure to the extent
possible or desirable for tax efficiency. In any case, at least one holding
company will continue to exist to hold the Company's common shares. The company
that now holds or may hold the Company's
CUSIP No. 861012102 13G Page 22 of 28 Pages
shares in the future for indirect shareholders is referred to below as the
"holding company". The 2001 shareholders' agreement provides that FT1CI may be
replaced as a shareholder in the holding company by France Telecom and/or Areva,
at their request.
The 2001 shareholders' agreement contains a standstill provision that
precludes any of the parties and the parties' affiliates from acquiring,
directly or indirectly, any of the Company's common shares or any instrument
providing for the right to acquire any of the Company's common shares other than
through the holding company until 24 months after such party ceases to be an
indirect shareholder of the Company.
Corporate Governance
Under the 2001 shareholders' agreement, the parties have agreed to
modify the corporate governance rights within the holding company so that they
will be shared equally by FT1CI and Finmeccanica, referred to below as the
"shareholders", despite occasional differences in indirect economic interest in
the Company, for 24 months after the date of the 2001 shareholders' agreement
plus the three-month period thereafter, referred to as the "Balance Period",
during which each of FT1CI and Finmeccanica has an option to rebalance their
shareholdings, referred to as the "Rebalancing Option". The Balance Period is
stated to continue as long as each shareholder in the holding company owns at
least 47.5% of its shares subject to the exercise of the Rebalancing Option.
Under the terms of the 2001 shareholders' agreement, the Balance Period would
have ended on March 9, 2004. The parties have agreed to extend the Balance
Period through April 9, 2004. In the case where one shareholder's stake exceeds
52.5% after the Balance Period, control of ST Holding will automatically be
granted to it, while certain rights will be preserved for the minority
shareholder.
During the Balance Period, the shareholders agree that the holding
company will have a managing board comprised of two members (one designated by
each shareholder) and a supervisory board comprised of eight members (four
designated by each shareholder). The chairman of the supervisory board of the
holding company shall be designated for a three-year term by one shareholder
(with the other shareholder entitled to designate the Vice-Chairman), such
designation to alternate between Finmeccanica and FT1CI. The current chairman of
the Supervisory Board is Mr. Testore and the current Vice-Chairman is Mr.
Arbola.
During the Balance Period, any other decision, to the extent that a
resolution of the holding company is required, must be pursuant to the unanimous
approval of the shareholders, including but not limited to the following: (i)
the definition of the role and structure of the Company's Managing Board and
Supervisory Board, and those of the holding company; (ii) the powers of the
chairman and the Vice-Chairman of the Company's Supervisory Board, and that of
the holding company; (iii) information by the Company's Managing Board and by
the Company's Supervisory Board, and those of the holding company; (iv)
treatment of confidential information; (v) appointment of any additional members
of the Company's Managing Board and that of the holding company; (vi)
remuneration of the members of the Company's Managing Board and those of the
holding company; (vii) internal audit of the Company and of the holding company;
(viii) industrial
CUSIP No. 861012102 13G Page 23 of 28 Pages
and commercial relationships between the Company and Finmeccanica or the Company
and either or both FT1CI shareholders, or any of their affiliates; and (ix) any
of the decisions listed in article 16.1 of the Company's Articles of Association
including the Company's budget and pluri-annual plans.
However, in the case of a hostile take-over bid for the Company, any
shareholder may, upon its sole request, obtain the activation by the holding
company of the option agreement relating to the preference shares described
below (provided that such activation is triggered by the Supervisory Board), in
which case both shareholders shall be required to finance the subscription by
the holding company of the preference shares, and such subscription and payment
shall be completed only to the extent required to implement the option agreement
so as to consolidate a majority of the Company's voting rights (and to the
exclusion of any further acquisitions of the Company's common shares, which
require the unanimous approval of the Company's shareholders).
As regards the Company during the Balance Period: (i) each shareholder
shall have the right to insert on a list prepared for proposal by the holding
company to the Company's general meeting of shareholders the same number of
members for election to the Supervisory Board, and the holding company shall
vote in favor of such members; (ii) the shareholders will cause the holding
company to submit to the Company's general meeting of shareholders and to vote
in favor of a common proposal for the appointment of the Managing Board; and
(iii) any decision relating to the voting rights of the holding company in the
Company shall require the unanimous approval of the holding company shareholders
and shall be submitted by the holding company to the Company's general meeting
of shareholders.
In addition, the following resolutions, to the extent that a
resolution of the holding company is required, must be resolved upon by a
shareholders resolution of the holding company, which shall require the
unanimous approval of the shareholders: (i) any alteration in the holding
company's articles of association; (ii) any issue, acquisition or disposal by
the holding company of its shares or change in share rights; (iii) any
alteration in the Company's authorized share capital or issue by the Company of
new shares and/or of any financial instrument giving rights to subscribe for the
Company's common shares; any acquisition or disposal by the holding company of
the Company's shares and/or any right to subscribe for the Company's common
shares; any modification to the rights attached to the Company's common shares;
any merger, acquisition or joint venture agreement to which the Company is or is
proposed to be a party; and any other items on the agenda of the Company's
general shareholders meeting; (iv) the liquidation or dissolution of the holding
company; (v) any legal merger, legal de-merger, acquisition or joint-venture
agreement to which the holding company is proposed to be a party; and (vi) the
adoption or approval of the Company's annual accounts or those of the holding
company or a resolution concerning a dividend distribution by the Company, it
being understood that a dividend distribution by the Company and the holding
company will be regulated by tracking stocks issued by the holding company to
the shareholders.
After the end of the Balance Period, unanimous approval by the
shareholders of the holding company remains required to approve:
CUSIP No. 861012102 13G Page 24 of 28 Pages
(i) As long as any of the shareholders indirectly owns at least 3% of the
Company's issued and outstanding share capital, with respect to the
holding company, any changes to the articles of association, any
issue, acquisition or disposal of shares in the holding company or
change in the rights of its shares, its liquidation or dissolution and
any legal merger, de-merger, acquisition or joint venture agreement to
which the holding company is proposed to be a party. However the
minority shareholder may not prevent the other shareholder from
increasing the capital of the holding company in order to finance the
acquisition of additional shares of the Company as a defense against a
hostile takeover bid for the Company.
(ii) As long as any of the shareholders indirectly owns at least 33% of the
holding company, certain changes to the Company's articles of
association (including any alteration in the Company's authorized
share capital, or any issue of share capital and/or financial
instrument giving the right to subscribe for the Company's common
shares, changes to the rights attached to the Company's shares,
changes to the preemptive rights, issues relating to the form, rights
and transfer mechanics of the shares, the composition and operation of
the Managing and Supervisory Boards, matters subject to the
Supervisory Board's approval, the Supervisory Board's voting
procedures, extraordinary meetings of shareholders and quorums for
voting at shareholders' meetings).
(iii) Any decision to vote the Company's shares held by the holding company
at any general meeting of the Company's shareholders with respect to
any substantial and material merger decision. In the event of a
failure by the shareholders to reach a common decision on the relevant
merger proposal, the Company's shares attributable to the minority
shareholder and held by the holding company will be counted as present
for purposes of a quorum of shareholders at one of the Company's
shareholders' meetings, but will not be voted (i.e., will be abstained
from the vote in a way that they will not be counted as a negative
vote or as a positive vote).
(iv) In addition, the minority shareholder will have the right to designate
at least one member of the list of candidates for the Supervisory
Board to be proposed by the holding company if that shareholder
Indirectly owns at least 3% of the Company's total issued and
outstanding share capital.
At the end of the Balance Period, the members of the Company's
Supervisory Board and those of the holding company designated by the minority
shareholder of the holding company will immediately resign upon request of the
holding company's majority shareholder, subject to the rights described in the
previous paragraph.
Disposals of The Company's Common Shares
Pursuant to the 2001 shareholders' agreement, ST Holding and France
Telecom have entered into transactions disposing of the Company's common shares.
o In December 2001, ST Holding sold 69 million of the Company's
existing common shares, reducing its holdings from 389,483,280 shares
to 320,483,280 shares. In this sale, France Telecom's indirect stake
in the Company was reduced by 39,000,000 shares and Finmeccanica's
stake was reduced by 30,000,000 shares.
CUSIP No. 861012102 13G Page 25 of 28 Pages
o Also in December 2001, France Telecom issued (euro)1,522,950,000
aggregate principal amount of 1.0% notes due December 17, 2004,
redeemable by way of exchange for up to 30 million of the Company's
existing common shares on or after January 2, 2004.
o On July 30, 2002, the Company was informed that France Telecom sold
(euro)442.2 million of 6 3/4% notes due August 6, 2005, mandatorily
exchangeable into a maximum of 26.42 million of the Company's existing
common shares (depending on the Company's share price at the maturity
date or redemption), disposing of appreciably all of its remaining
interest in the Company.
o In August 12, 2003, Finmeccanica, through its subsidiary
Finmeccanica Finance, issued(euro)438,725,000 aggregate principal
amount of Finmeccanica Exchangeable Notes which exchangeable from
January 2, 2004 for approximately 17.5 million of the Company's
existing common shares held by Finmeccanica at their initial exchange
ratio, which is 39.8883 per Exchangeable Note, or approximately 2% of
the Company's issued and outstanding common shares (increased to 20
million of the Company's existing common shares, or approximately 2.3%
of the Company's issued and outstanding common shares after exercise
of the over allotment option in the Finmeccanica Exchangeable Notes
offering, which was exercised in full).
o During the second half of 2003, Finmeccanica sold an aggregate of
9,000,000 of the Company's existing common shares.
o Pursuant to the terms and conditions of France Telecom's 1.0%
exchangeable notes, on February 6, 2004, France Telecom notified the
holders of its 1.0% notes of its decision to redeem the notes. When
successfully completed, on March 9, 2004, the shares underlying France
Telecom's 1.0% exchangeable notes held in escrow by BNP Paribas
Securities Services (France) will be released from escrow.
The 2001 shareholders' agreement also provided for ST Holding II to
enter into escrow arrangements with France Telecom and Finmeccanica with respect
to the Company's common shares underlying the exchangeable notes sold in
December 2001, July 2002 and August 2003. The 2001 shareholders' agreement
provides that France Telecom and Finmeccanica will have a call option over those
shares upon exchange of the exchangeable notes for common shares. The voting
rights with respect to the shares held in escrow will at all times be exercised
by ST Holding II. The agreement further provides that each of the shareholders
may request ST Holding to enter into hedging agreements.
As long as any of the parties to the shareholders' agreement has a
direct or indirect interest in the Company, subject to the public offer
exception listed in paragraph (v) above, no sales by a party to the 2001
shareholders' agreement may be made of any of the Company's shares or of FT1CI,
ST Holding or ST Holding II to any of the Company's top ten competitors, or any
company that controls such competitor.
Change of Control Provision
The 2001 shareholders' agreement provides for tag-along rights,
pre-emptive rights, and provisions with respect to a change of control of any of
the shareholders or any controlling shareholder of FT1CI, on the one hand, and
Finmeccanica, on the other hand.
CUSIP No. 861012102 13G Page 26 of 28 Pages
The shareholders may transfer shares of the holding company or FT1CI to any of
the shareholder's affiliates, which would include the Italian state or the
French state with respect to entities controlled by a state. The shareholders
and their ultimate shareholders will be prohibited from launching any takeover
process on any of the other shareholders.
Preference Shares
On May 31, 1999, the Company's shareholders at the annual general
meeting approved the creation of 180,000,000 preference shares (540,000,000
preference shares, as adjusted for the 3-to-1 stock split implemented in May
2000). These preference shares entitle a holder to full voting rights at any
meeting of shareholders and to a preferential right to dividends. On the same
day, the Company entered into an option agreement with ST Holding II, amended in
August of 2002, which provides that preference shares shall be issued to ST
Holding II upon request, subject to the adoption of a resolution of the
Company's Supervisory Board recognizing that a hostile takeover or similar
action exists and giving the Company's consent to the exercise of the option and
upon payment of at least 25% of the par value of the preference shares to be
issued. Following the 2002 amendment to the ST Holding II option agreement, the
option is contingent upon ST Holding II retaining at least 30% of the Company's
issued share capital at the time of exercise of the option. Upon exchange in
full of the existing France Telecom exchangeable notes and the Finmeccanica
exchangeable notes (in each case which became possible on January 2, 2004 and
relate to existing common shares), and upon conversion in full of the Company's
outstanding convertible bonds due 2009, 2010 and 2013, as well as the dilution
due to the exercise of share options, ST Holding II's ownership would fall below
the 30% threshold.
Under the 2001 shareholders' agreement, any shareholder can cause the
holding company to exercise the option to acquire the preference shares in the
event of a hostile takeover bid for the Company.
Other Shareholders Agreements
The shareholders of FT1CI entered into a separate shareholders'
agreement in January 1993. On December 28, 2001, France Telecom and Areva
modified this agreement in its entirety to reflect the 2001 shareholders'
agreement between the shareholders of ST Holding (the "2001 FT1CI protocol").
The 2001 FT1CI protocol provided for the capital reduction of FT1CI to reflect
the sale by France Telecom of a portion of its indirect interest in the Company.
At the end of the two-year period described above under "--Disposals of The
Company's Common Shares", Areva can either require an additional capital
reduction of FT1CI or buy France Telecom's remaining shares in FT1CI.
The 2001 FT1CI protocol provides for modified corporate governance
arrangements based on France Telecom's level of ownership of the Company. It
provides that FT1CI shall continue to have five directors, three of whom shall
be chosen by Areva and two of whom shall be chosen by France Telecom, provided
that France Telecom shall only choose one director once its interest in FT1CI
falls below 30%. Also, France Telecom will have the right to nominate a number
of FT1CI representatives to the Supervisory Board of ST Holding, ST Holding II
and the Company in proportion to its holdings, with at least one member to the
extent that FT1CI has at least two on those Supervisory Boards as long as
CUSIP No. 861012102 13G Page 27 of 28 Pages
France Telecom owns at least 20% of the capital of FT1CI. France Telecom will
cause its appointed directors to these entities to resign as necessary if and
when its interest in FT1CI is reduced. Except as set forth below, decisions with
respect to ST Holding, the Company and the Company's subsidiaries may be taken
by simple majority. Certain actions by FT1CI will continue to require the
approval of the France Telecom director or directors. These include (i) all
borrowings above (euro)2 million, (ii) certain loans and advances, (iii)
issuance of guarantees, (iv) changes to any shareholder agreements entered into
by FT1CI, (v) distribution of any dividends and (vi) introduction of any new
shareholder.
In case ST Holding II requests the issuance of preference shares
pursuant to the option agreement with the Company, the new FT1CI shareholders'
agreement provides that the payment by FT1CI for the subscription price will be
shared on a pro rata basis between Areva and France Telecom according to the
number of the Company's common shares attributed to each on the date of
exercise. Each has undertaken to pay such subscription amounts according to
their respective pro rata stakes.
Following the 24-month period from the ST Holding 2001 shareholders'
agreement, should Finmeccanica exercise its right to make a public offering of
the Company's common shares, FT1CI's right of first refusal may be exercised by
Areva in the first instance, and then by France Telecom. In addition, in case of
a Finmeccanica public offering, both Areva and France Telecom may cause FT1CI to
exercise its tag-along rights to offer the Company's common shares corresponding
to the respective indirect holding. If either party were to exercise its right
of first refusal or tag-along rights, Areva and France Telecom undertake to
cause FT1CI to undertake all appropriate actions.
Transfers of shares in FT1CI to third parties are subject to a right
of preemption, a right of first refusal of the other shareholders, as well as
other provisions. In the event Areva proposes to sell its interest in FT1CI, in
whole or in part, France Telecom has the right to require the acquirer to
purchase its interest as well. The FT1CI shareholders' agreement terminates upon
the termination of FT1CI or when either party ceases to be a shareholder of
FT1CI.
As is the case with other companies controlled by the French
government, the French government has appointed a Commissaire du Gouvernement
and a Controleur d'Etat for FT1CI. Pursuant to Decree No. 94-214, dated March
10, 1994, these government representatives have the right (i) to attend any
board meeting of FT1CI, and (ii) to veto any board resolution or any decision of
the president of FT1CI within ten days of such board meeting (or, if they have
not attended the meeting, within ten days of the receipt of the board minutes or
the notification of such president's decision); such veto lapses if not
confirmed within one month by the Ministry of the Economy or the Secretariat
d'Etat a l'Industrie (Secretary of Industry). FT1CI is subject to certain points
of the arrete of August 9, 1953 pursuant to which the Ministry of the Economy
and any other relevant ministries (a) have the authority to approve decisions of
FT1CI relating to budgets or forecasts of revenues, operating expenses and
capital expenditures, and (b) may set accounting principles and rules of
evaluation of fixed assets and amortization.
Pursuant to the principal Italian privatization law, certain special
government powers may be introduced into the bylaws of firms considered
strategic by the Italian
CUSIP No. 861012102 13G Page 28 of 28 Pages
government. In the case of Finmeccanica, these powers were established by
decrees adopted by the Minister of the Treasury on November 8, 1999 and
Finmeccanica's bylaws were subsequently amended on November 23, 1999. The
special powers of the Minister of the Treasury (who will act in agreement with
the Minister of Industry) include (i) the approval or disapproval of the
acquisition of material interests in Finmeccanica's share capital, (ii) approval
of material shareholders' agreements relating to Finmeccanica's share capital,
(iii) appointment of members of Finmeccanica's board of directors and board of
statutory auditors, and (iv) powers to veto resolutions to dissolve
Finmeccanica, transfer its business, merge, conduct spin-offs, sell businesses
or lines of business, including the transfer of equity participations in
subsidiaries or affiliates, transfer its registered office outside of Italy,
change Finmeccanica's corporate purposes or amend or modify any of the Minister
of the Treasury's special powers.
In connection with the Company's initial public offering in 1994, the
Company entered into a registration rights agreement with ST Holding II pursuant
to which the Company agreed that, upon request from ST Holding II, the Company
will file a registration statement under the Securities Act to register common
shares held by ST Holding II, subject to a maximum number of five requests in
total as well as a maximum of one request in any twelve-month period. Subject to
certain conditions, the Company will grant ST Holding II the right to include
the Company's common shares in any registration statements covering offerings of
common shares by the Company. ST Holding II will pay a portion of the costs of
any requested or incidental registered offering based upon its proportion of the
total number of common shares being registered, except that ST Holding II will
pay any underwriting commissions relating to common shares that it sells in such
offerings and any fees and expenses of its separate advisors, if any. The
Company's registration rights agreement with ST Holding II will terminate upon
the earlier of December 15, 2004 and such time as ST Holding II and its
affiliates own less than 10% of the Company's outstanding common shares.