On December 21, 2020, MDC and Stagwell Media LP issued a joint press release announcing the Proposed Transaction, pursuant to which MDC will be acquired by Stagwell and its business will merge with the business of the subsidiaries of Stagwell that own and operate a portfolio of marketing services companies (the “Stagwell Subject Entities”). Stagwell currently owns approximately 19.4% of the Company’s outstanding shares. On a pro forma basis, without giving effect to any conversion of outstanding preference shares of MDC, the pre-transaction holders of MDC shares would own 26% of the common equity of New MDC and Stagwell shareholders would be issued shares of a new class C series equivalent to 74% of the common equity of New MDC and exchangeable into shares of New MDC class A shares on a one-for-one basis at Stagwell’s election.

On February 8, 2021, MDC filed a Form S-4 Registration Statement with the SEC. The Complaint alleges the Registration Statement, which recommends that MDC stockholders vote in favor of the Proposed Transaction, omits or misrepresents material information concerning, among other things: (i) the Company’s and Stagwell’s financial projections and the financial analyses supporting the fairness opinions provided by the financial advisors to the special committee of the Board and (ii) the financial advisors' potential conflicts of interest.