<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14D-1
AMENDMENT NO. 13
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(D)(1) OF THE SECURITIES EXCHANGE
ACT OF 1934
SANTA FE PACIFIC CORPORATION
------------------------------------------------------------
(NAME OF SUBJECT COMPANY)
UNION PACIFIC CORPORATION
UP ACQUISITION CORPORATION
------------------------------------------------------------
(BIDDERS)
COMMON STOCK, PAR VALUE $1.00 PER SHARE
(INCLUDING THE ASSOCIATED PREFERRED SHARE PURCHASE RIGHTS)
------------------------------------------------------------
(TITLE OF CLASS OF SECURITIES)
802183 1 03
------------------------------------------------------------
(CUSIP NUMBER OF CLASS OF SECURITIES)
RICHARD J. RESSLER
ASSISTANT GENERAL COUNSEL
UNION PACIFIC CORPORATION
EIGHTH AND EATON AVENUES
BETHLEHEM, PENNSYLVANIA 18018
(610) 861-3200
------------------------------------------------------------
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO
RECEIVE NOTICES AND COMMUNICATIONS ON BEHALF OF BIDDERS)
with a copy to:
PAUL T. SCHNELL, ESQ.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM
919 THIRD AVENUE
NEW YORK, NEW YORK 10022
TELEPHONE: (212) 735-3000
CALCULATION OF FILING FEE
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Transaction valuation* Amount of filing fee**
- ----------------------------------------------------------------------------------------------
$3,751,271,048 $750,254.21
- ----------------------------------------------------------------------------------------------
</TABLE>
* For purposes of calculating the filing fee only. This calculation assumes the
purchase of 202,798,177 shares of Common Stock, par value $1.00 per share, of
Santa Fe Pacific Corporation $18.50 net per share in cash.
** The amount of the filing fee, calculated in accordance with Rule 0-11(d) of
the Securities Exchange Act of 1934, as amended, equals 1/50th of one percent
of the aggregate value of cash offered by UP Acquisition Corporation for such
number of shares.
/X/ Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the form
or schedule and the date of its filing.
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Amount Previously Paid: $405,660.94 Filing Party: Same
Form or Registration No.: 14D-1 Date Filed: November 9, 1994
</TABLE>
<PAGE> 2
Union Pacific Corporation, a Utah corporation ("Parent"), and UP
Acquisition Corporation, a wholly-owned subsidiary of Parent (the "Purchaser"),
hereby amend and supplement their Statement on Schedule 14D-1 ("Schedule
14D-1"), filed with the Securities and Exchange Commission (the "Commission") on
November 9, 1994, as amended, with respect to the Purchaser's offer to purchase
all of the outstanding shares of Common Stock, par value $1.00 per share (the
"Shares"), of Santa Fe Pacific Corporation, a Delaware corporation (the
"Company"), at a price of $18.50 per Share, without interest, upon the terms and
subject to the conditions set forth in the Offer to Purchase, dated November 9,
1994 (the "Offer to Purchase"), as amended and supplemented by the Supplement
thereto, dated January 18, 1995 (the "Supplement"), and the revised Letter of
Transmittal (which, as amended from time to time, together constitute the
"Offer"), which have been annexed to and filed with the Schedule 14D-1 as
Exhibits (a)(1), (a)(26) and (a)(27), respectively.
Unless otherwise indicated herein, each capitalized term used but not
defined herein shall have the meaning assigned to such term in the Schedule
14D-1 or in the Offer to Purchase referred to therein.
ITEM 1. SECURITY AND SUBJECT COMPANY.
The information set forth in Items 1(b) and (1)(c) of the Schedule 14D-1 is
hereby amended and supplemented by the following:
(b) The information set forth in the Introduction and Section 1 ("Amended
Terms of the Offer") of the Supplement is incorporated herein by reference.
(c) The information set forth in Section 5 ("Price Range of the Shares;
Dividends") of the Supplement is incorporated herein by reference.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
The information set forth in Item 3(b) of the Schedule 14D-1 is hereby
amended and supplemented by the following:
The information set forth in the Introduction, Section 9 ("Background of
the Offer since November 9, 1994; Contacts with the Company") and Section 10
("Purpose of the Offer and the Proposed Merger") of the Supplement is
incorporated herein by reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
The information set forth in Items 4(a) and (b) of the Schedule 14D-1 is
hereby amended and supplemented by the following:
The information set forth in Section 8 ("Source and Amount of Funds") of
the Supplement is incorporated herein by reference.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER.
The information set forth in Item 5(a)-(g) of the Schedule 14D-1 is hereby
amended and supplemented by the following:
The information set forth in the Introduction and Sections 9 ("Background
of the Offer since November 9, 1994; Contacts with the Company") and Section 10
("Purpose of the Offer and the Proposed Merger") of the Supplement is
incorporated herein by reference.
2
<PAGE> 3
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO THE SUBJECT COMPANY'S SECURITIES.
The information set forth in Item 7 of the Schedule 14D-1 is hereby amended
and supplemented by the following:
The information set forth in the Introduction, Section 9 ("Background of
the Offer since November 9, 1994; Contacts with the Company"), Section 10
("Purpose of the Offer and the Proposed Merger") and Section 12 ("Certain Legal
Matters; Regulatory Approvals") of the Supplement is incorporated herein by
reference.
ITEM 10. ADDITIONAL INFORMATION.
The information set forth in Items 10(e) and (f) of the Schedule 14D-1 is
hereby amended and supplemented by the following:
(b)-(c) The information set forth in the Introduction and Section 10
("Purpose of the Offer and the Proposed Merger") of the Supplement is
incorporated by reference.
(e) The information set forth in Section 12 ("Certain Legal Matters;
Regulatory Approvals") of the Supplement is incorporated herein by reference.
(f) The information set forth in the Supplement and the revised Letter of
Transmittal, copies of which are attached hereto as Exhibits (a)(26) and
(a)(27), respectively, is incorporated herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
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(a) (1) Offer to Purchase, dated November 9, 1994.*
(2) Letter of Transmittal.*
(3) Notice of Guaranteed Delivery.*
(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other
Nominees.*
(5) Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies
and Other Nominees.*
(6) Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9.*
(7) Letter to Participants in the Dividend Reinvestment Plan of Santa Fe Pacific
Corporation, dated November 9, 1994.*
(8) Text of Press Release dated November 8, 1994 issued by Union Pacific
Corporation.*
(9) Text of Press Release dated November 9, 1994 issued by Union Pacific
Corporation.*
(10) Form of Summary Advertisement, dated November 10, 1994.*
(11) Text of Press Release dated November 10, 1994 issued by Union Pacific
Corporation.*
(12) None.
(13) Text of Press Release and attached letter dated November 14, 1994 issued by
Union Pacific Corporation.*
(14) Text of letter sent by Union Pacific Corporation to the stockholders of Santa Fe
Pacific Corporation on November 12, 1994.*
(15) Text of Press Release dated November 17, 1994 issued by Union Pacific
Corporation.*
(16) Text of Press Release dated November 22, 1994 issued by Union Pacific
Corporation.*
(17) Text of Letter sent by Union Pacific Corporation to the stockholders of Santa Fe
Pacific Corporation on November 22, 1994.*
(18) Text of Press Release dated November 28, 1994 issued by Union Pacific
Corporation.*
</TABLE>
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* Previously filed.
3
<PAGE> 4
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(19) Text of Press Release dated December 2, 1994 issued by Union Pacific
Corporation.*
(20) Text of Press Release dated December 7, 1994 issued by Union Pacific
Corporation.*
(21) Text of Press Release dated December 7, 1994 issued by Union Pacific
Corporation.*
(22) Text of Press Release dated December 15, 1994 issued by Union Pacific
Corporation.*
(23) Text of Press Release dated December 16, 1994 issued by Union Pacific
Corporation.*
(24) Text of Press Release dated December 16, 1994 issued by Union Pacific
Corporation.*
(25) Text of Press Release dated December 20, 1994 issued by Union Pacific
Corporation.*
(26) Supplement to the Offer to Purchase, dated January 18, 1995.
(27) Revised Letter of Transmittal.
(28) Revised Notice of Guaranteed Delivery.
(29) Revised Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other
Nominees.
(30) Revised Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees.
(31) Revised Letter to Participants in the Dividend Reinvestment Plan of Santa Fe
Pacific Corporation.
(32) Form of Notice of Withdrawal.
(33) Text of Press Release dated January 17, 1994 issued by Union Pacific
Corporation.
(b) (1) Commitment Letter, dated November 9, 1994, among Union Pacific Corporation,
Citicorp Securities, Inc., Credit Suisse and NationsBanc Capital Markets, Inc.,
as co-arrangers, and Citibank, N.A., Credit Suisse and NationsBank of North
Carolina, N.A., as co-administrative agents.*
(c) (1) Draft form of Voting Trust Agreement.*
(2) Interstate Commerce Commission Opinion, dated November 28, 1994.*
(d) Not applicable.
(e) Not applicable.
(f) None.
(g) (1) Consolidated and Amended Complaint ("Consolidated and Amended Complaint") in
connection with In re Santa Fe Pacific Shareholder Litigation, filed in the
Court of Chancery in Delaware on October 14, 1994.*
(2) First Amended and Supplemental Complaint ("First Amended and Supplemental
Complaint") in connection with Union Pacific Corporation and James A. Shattuck
v. Santa Fe Pacific Corporation, et al., filed in the Court of Chancery in
Delaware on October 19, 1994.*
(3) Answer of Santa Fe Pacific Corporation defendants to Consolidated and Amended
Complaint.*
(4) Answer of Santa Fe Pacific Corporation defendants to First Amended and
Supplemental Complaint.*
(5) Order of the Court of Chancery in Delaware, dated October 18, 1994, denying
Union Pacific Corporation's application for expedited discovery.*
(6) Motion to Dismiss First Amended and Supplemental Complaint, filed by Burlington
Northern Inc.*
(7) Proxy Statement, dated October 28, 1994 of Union Pacific Corporation.*
(8) Supplement to Proxy Statement, dated November 9, 1994 of Union Pacific
Corporation.*
(9) Letter, dated December 14, 1994, by Union Pacific Corporation to Santa Fe
Pacific Corporation.*
</TABLE>
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* Previously filed.
4
<PAGE> 5
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(10) Letter, dated December 18, 1994, by Union Pacific Corporation to Santa Fe
Pacific Corporation.*
(11) Supplement to Proxy Statement, dated January 18, 1995, of Union Pacific
Corporation.
(12) Form of Second Amended and Supplemental Complaint in connection with Union
Pacific Corporation and James A. Shattuck v. Santa Fe Pacific Corporation, et.
al., filed in the Court of Chancery in Delaware on January 18, 1995.
</TABLE>
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* Previously filed.
5
<PAGE> 6
SIGNATURE
After due 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: January 18, 1995 UNION PACIFIC CORPORATION
By: /s/ GARY M. STUART
------------------------------------
Title: Vice President and Treasurer
6
<PAGE> 7
SIGNATURE
After due 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: January 18, 1995 UP ACQUISITION CORPORATION
By: /s/ GARY M. STUART
------------------------------------
Title: Vice President and Treasurer
7
<PAGE> 8
EXHIBIT INDEX
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EXHIBIT SEQUENTIALLY
NO. DESCRIPTION NUMBERED PAGE
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(a) (1) Offer to Purchase, dated November 9, 1994.*...........................
(2) Letter of Transmittal.*...............................................
(3) Notice of Guaranteed Delivery.*.......................................
(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and
Other Nominees.*......................................................
(5) Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees.*........................................
(6) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9.*.................................................
(7) Letter to Participants in the Dividend Reinvestment Plan of Santa Fe
Pacific Corporation, dated November 9, 1994.*.........................
(8) Text of Press Release dated November 8, 1994 issued by Union Pacific
Corporation.*.........................................................
(9) Text of Press Release dated November 9, 1994 issued by Union Pacific
Corporation.*.........................................................
(10) Form of Summary Advertisement, dated November 10, 1994.*..............
(11) Text of Press Release dated November 10, 1994 issued by Union Pacific
Corporation.*.........................................................
(12) None..................................................................
(13) Text of Press Release and attached letter dated November 14, 1994
issued by Union Pacific Corporation.*.................................
(14) Text of letter sent by Union Pacific Corporation to the stockholders
of Santa Fe Pacific Corporation on November 12, 1994.*................
(15) Text of Press Release dated November 17, 1994 issued by Union Pacific
Corporation.*.........................................................
(16) Text of Press Release dated November 22, 1994 issued by Union Pacific
Corporation.*.........................................................
(17) Text of Letter sent by Union Pacific Corporation to the stockholders
of Santa Fe Pacific Corporation on November 22, 1994.*................
(18) Text of Press Release dated November 28, 1994 issued by Union Pacific
Corporation.*.........................................................
(19) Text of Press Release dated December 2, 1994 issued by Union Pacific
Corporation.*.........................................................
(20) Text of Press Release dated December 7, 1994 issued by Union Pacific
Corporation.*.........................................................
(21) Text of Press Release dated December 7, 1994 issued by Union Pacific
Corporation.*.........................................................
(22) Text of Press Release dated December 15, 1994 issued by Union Pacific
Corporation.*.........................................................
(23) Text of Press Release dated December 16, 1994 issued by Union Pacific
Corporation.*.........................................................
(24) Text of Press Release dated December 16, 1994 issued by Union Pacific
Corporation.*.........................................................
</TABLE>
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* Previously filed.
8
<PAGE> 9
<TABLE>
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EXHIBIT SEQUENTIALLY
NO. DESCRIPTION NUMBERED PAGE
- ------- ---------------------------------------------------------------------- -------------
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(25) Text of Press Release dated December 20, 1994 issued by Union Pacific
Corporation.*.........................................................
(26) Supplement to the Offer to Purchase, dated January 18, 1995...........
(27) Revised Letter of Transmittal.........................................
(28) Revised Notice of Guaranteed Delivery.................................
(29) Revised Letter to Brokers, Dealers, Commercial Banks, Trust Companies
and Other Nominees....................................................
(30) Revised Letter to Clients for use by Brokers, Dealers, Commercial
Banks, Trust Companies and Other Nominees.............................
(31) Revised Letter to Participants in the Dividend Reinvestment Plan of
Santa Fe Pacific Corporation..........................................
(32) Form of Notice of Withdrawal..........................................
(33) Text of Press Release dated January 17, 1994 issued by Union Pacific
Corporation...........................................................
(b) (1) Commitment Letter, dated November 9, 1994, among Union Pacific
Corporation, Citicorp Securities, Inc., Credit Suisse and NationsBanc
Capital Markets, Inc., as co-arrangers, and Citibank, N.A., Credit
Suisse and NationsBank of North Carolina, N.A., as co-administrative
agents.*..............................................................
(c) (1) Draft Form of Voting Trust Agreement.*................................
(2) Interstate Commerce Commission Opinion, dated November 28, 1994.*.....
(d) Not applicable........................................................
(e) Not applicable........................................................
(f) None..................................................................
(g) (1) Consolidated and Amended Complaint ("Consolidated and Amended
Complaint") in connection with In re Santa Fe Pacific Shareholder
Litigation, filed in the Court of Chancery in Delaware on October 14,
1994.*................................................................
(2) First Amended and Supplemental Complaint ("First Amended and
Supplemental Complaint") in connection with Union Pacific Corporation
and James A. Shattuck v. Santa Fe Pacific Corporation, et al., filed
in the Court of Chancery in Delaware on October 19, 1994.*............
(3) Answer of Santa Fe Pacific Corporation defendants to Consolidated and
Amended Complaint.*...................................................
(4) Answer of Santa Fe Pacific Corporation defendants to First Amended and
Supplemental Complaint.*..............................................
(5) Order of the Court of Chancery in Delaware, dated October 18, 1994,
denying Union Pacific Corporation's application for expedited
discovery.*...........................................................
(6) Motion to Dismiss First Amended and Supplemental Complaint, filed by
Burlington Northern Inc.*.............................................
(7) Proxy Statement, dated October 28, 1994 of Union Pacific
Corporation.*.........................................................
(8) Supplement to Proxy Statement, dated November 9, 1994 of Union Pacific
Corporation.*.........................................................
(9) Letter, dated December 14, 1994, by Union Pacific Corporation to Santa
Fe Pacific Corporation.*..............................................
(10) Letter, dated December 18, 1994, by Union Pacific Corporation to Santa
Fe Pacific Corporation.*..............................................
</TABLE>
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* Previously filed.
9
<PAGE> 10
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIALLY
NO. DESCRIPTION NUMBERED PAGE
- ------- ---------------------------------------------------------------------- -------------
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(11) Supplement to Proxy Statement, dated January 18, 1995, of Union
Pacific Corporation...................................................
(12) Form of Second Amended and Supplemental Complaint in connection with
Union Pacific Corporation and James A. Shattuck v. Santa Fe Pacific
Corporation, et. al., filed in the Court of Chancery in Delaware on
January 18, 1995......................................................
</TABLE>
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* Previously filed.
10
<PAGE> 1
Supplement to the Offer to Purchase Dated November 9, 1994
UP ACQUISITION CORPORATION
a wholly-owned subsidiary of
UNION PACIFIC CORPORATION
Has Amended Its Offer and is Now Offering to Purchase
All Outstanding Shares of Common Stock
(Including the Associated Preferred Share Purchase Rights)
of
SANTA FE PACIFIC CORPORATION
at
$18.50 NET PER SHARE IN CASH
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME,
ON TUESDAY, FEBRUARY 7, 1995, UNLESS THE OFFER IS EXTENDED.
------------------------
THIS OFFER IS NOW CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY
TENDERED PRIOR TO THE EXPIRATION OF THE OFFER AND NOT WITHDRAWN A NUMBER OF
SHARES WHICH, WHEN ADDED TO THE SHARES BENEFICIALLY OWNED BY UP ACQUISITION
CORPORATION (THE "PURCHASER") AND ITS AFFILIATES, CONSTITUTES AT LEAST A
MAJORITY OF THE SHARES OUTSTANDING ON A FULLY DILUTED BASIS, (2) SANTA FE
PACIFIC CORPORATION (THE "COMPANY") HAVING ENTERED INTO A DEFINITIVE MERGER
AGREEMENT WITH UNION PACIFIC CORPORATION ("PARENT") AND THE PURCHASER TO
PROVIDE FOR THE ACQUISITION OF THE COMPANY PURSUANT TO THE OFFER AND THE
PROPOSED MERGER DESCRIBED HEREIN, (3) THE STOCKHOLDERS OF THE COMPANY
NOT HAVING APPROVED THE AGREEMENT AND PLAN OF MERGER BETWEEN THE
COMPANY AND BURLINGTON NORTHERN INC. (THE "BNI/SFP AGREEMENT"), (4)
THE PURCHASER BEING SATISFIED THAT SECTION 203 OF THE DELAWARE
GENERAL CORPORATION LAW HAS BEEN COMPLIED WITH OR IS INVALID OR
OTHERWISE INAPPLICABLE TO THE OFFER AND THE PROPOSED MERGER, (5)
THE PURCHASER BEING SATISFIED THAT THE BNI/SFP AGREEMENT HAS BEEN
TERMINATED IN ACCORDANCE WITH ITS TERMS, (6) THE PURCHASER BEING
SATISFIED THAT THE RIGHTS (AS DEFINED HEREIN) HAVE BEEN REDEEMED
BY THE COMPANY OR THE RIGHTS ARE UNENFORCEABLE OR OTHERWISE
INAPPLICABLE TO THE OFFER AND THE PROPOSED MERGER AND (7) THE
ABSENCE OF ANY JUDICIAL, ADMINISTRATIVE OR OTHER DETERMINATION
INVALIDATING, MODIFYING OR IMPOSING LIMITATIONS UNACCEPTABLE TO
THE PURCHASER ON THE INTERSTATE COMMERCE COMMISSION'S (THE
"ICC") APPROVAL OF THE PURCHASER'S USE OF A VOTING TRUST. THE
OFFER IS ALSO SUBJECT TO OTHER TERMS AND CONDITIONS CONTAINED
IN THIS SUPPLEMENT. SEE SECTION 11 OF THIS SUPPLEMENT. THE
OFFER IS NOT CONDITIONED UPON APPROVAL BY THE ICC OF THE
PURCHASER'S ACQUISITION OF CONTROL OF THE COMPANY. IF THE
STOCKHOLDERS OF THE COMPANY APPROVE THE BNI/SFP AGREEMENT,
THE PURCHASER WILL TERMINATE THE OFFER. AS DESCRIBED
HEREIN, THE PURCHASER WILL WAIVE THE MERGER AGREEMENT
CONDITION UPON THE OCCURRENCE OF CERTAIN EVENTS.
------------------
IMPORTANT
THE PURCHASER IS CURRENTLY REVIEWING ITS OPTIONS WITH RESPECT TO THE OFFER
AND MAY CONSIDER, AMONG OTHER THINGS, CHANGES TO THE MATERIAL TERMS OF THE
OFFER. IN ADDITION, PARENT AND THE PURCHASER INTEND TO CONTINUE TO SEEK TO
NEGOTIATE WITH THE COMPANY WITH RESPECT TO THE ACQUISITION OF THE COMPANY BY
PARENT OR THE PURCHASER. THE PURCHASER RESERVES THE RIGHT TO AMEND THE OFFER
(INCLUDING AMENDING THE NUMBER OF SHARES TO BE PURCHASED, THE PURCHASE PRICE AND
THE PROPOSED SECOND-STEP MERGER CONSIDERATION) UPON ENTERING INTO A SECOND-STEP
MERGER AGREEMENT WITH THE COMPANY OR TO NEGOTIATE A MERGER AGREEMENT WITH THE
COMPANY NOT INVOLVING A TENDER OFFER PURSUANT TO WHICH THE PURCHASER WOULD
TERMINATE THE OFFER AND THE SHARES WOULD, UPON CONSUMMATION OF SUCH MERGER, BE
CONVERTED INTO CASH, SHARES OF COMMON STOCK OF PARENT AND/OR OTHER SECURITIES IN
SUCH AMOUNTS AS ARE NEGOTIATED BY PARENT AND THE COMPANY.
Any stockholder desiring to tender all or any portion of such stockholder's
Shares and associated Rights should either (i) complete and sign one of the
Letters of Transmittal (or a facsimile thereof) in accordance with the
instructions in the Letters of Transmittal and mail or deliver it together with
the certificate(s) representing tendered Shares, and any other required
documents, to the Depositary or tender such Shares pursuant to the procedures
for book-entry transfer set forth in Section 3 of the Offer to Purchase or (ii)
request such stockholder's broker, dealer, commercial bank, trust company or
other nominee to effect the transaction for such stockholder. A stockholder
whose Shares are registered in the name of a broker, dealer, commercial bank,
trust company or other nominee must contact such broker, dealer, commercial
bank, trust company or other nominee if such stockholder desires to tender such
Shares.
A stockholder who desires to tender Shares and whose certificates
representing such Shares are not immediately available, or who cannot comply
with the procedures for book-entry transfer on a timely basis, may tender such
Shares by following the procedures for guaranteed delivery set forth in Section
3 of the Offer to Purchase.
Questions and requests for assistance, or for additional copies of the Offer
to Purchase, this Supplement, the revised Letter of Transmittal or other tender
offer materials, may be directed to the Information Agent or the Dealer Manager
at their respective addresses and telephone numbers set forth on the back cover
of the Offer to Purchase or this Supplement. Holders of Shares may also contact
brokers, dealers, commercial banks and trust companies for assistance concerning
the Offer.
------------------
The Dealer Manager for the Offer is:
CS First Boston Corporation
January 18, 1995
<PAGE> 2
TABLE OF CONTENTS
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PAGE
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INTRODUCTION........................................................ 3
THE TENDER OFFER....................................................
1. Amended Terms of the Offer.................................... 6
2. Procedures for Tendering Shares............................... 7
3. Withdrawal Rights............................................. 8
4. Certain Federal Income Tax Consequences....................... 8
5. Price Range of Shares; Dividends.............................. 9
6. Certain Information Concerning the Company.................... 9
7. Certain Information Concerning the Purchaser and Parent....... 11
8. Source and Amount of Funds.................................... 11
9. Background of the Offer since November 9, 1994; Contacts with
the Company................................................. 12
10. Purpose of the Offer and the Proposed Merger.................. 26
11. Amended Conditions of the Offer............................... 28
12. Certain Legal Matters; Regulatory Approvals................... 31
13. Miscellaneous................................................. 32
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2
<PAGE> 3
To the Holders of Shares of Common Stock of Santa Fe Pacific Corporation:
INTRODUCTION
The following information amends and supplements the Offer to Purchase,
dated November 9, 1994 (the "Offer to Purchase"), of UP Acquisition Corporation
(the "Purchaser"), a Utah corporation and a wholly-owned subsidiary of Union
Pacific Corporation, a Utah corporation ("Parent"), pursuant to which the
Purchaser is offering to purchase all of the outstanding shares of Common Stock,
par value $1.00 per share (the "Shares"), of Santa Fe Pacific Corporation, a
Delaware corporation (the "Company"), including the associated preferred share
purchase rights (the "Rights") issued pursuant to the Rights Agreement, dated as
of November 28, 1994, between the Company and First Chicago Trust Company of New
York, as Rights Agent (the "Rights Agreement"). The Purchaser has increased the
price to be paid in the Offer to $18.50 per Share, net to the seller in cash,
without interest thereon (the "Offer Price") upon the terms and subject to the
conditions set forth in the Offer to Purchase, this Supplement and in the
revised Letter of Transmittal (which, as amended from time to time, together
constitute the "Offer"). Unless the context requires otherwise, all references
to Shares herein and in the Offer to Purchase shall include the Rights, and all
references to the Rights shall include all benefits that may inure to the
holders of the Rights pursuant to the Rights Agreement.
The purpose of the Offer is to acquire all of the outstanding Shares of the
Company. Parent is seeking to negotiate with the Company a definitive
acquisition agreement (the "Proposed Merger Agreement") pursuant to which the
Company would, as soon as practicable following consummation of the Offer,
consummate a merger (the "Proposed Merger") with the Purchaser or another direct
or indirect wholly-owned subsidiary of Parent. In the Proposed Merger, at the
effective time of the Proposed Merger, each Share that is issued and outstanding
immediately prior to the effective time (other than Shares held in the treasury
of the Company or owned by Parent, the Purchaser or any direct or indirect
wholly-owned subsidiary of Parent and Shares ("Dissenting Shares") held by
stockholders who properly exercise appraisal rights under the Delaware General
Corporation Law (the "DGCL")) would be converted into the right to receive
$18.50 in cash. See Section 10 and Section 11 of the Offer to Purchase and
Section 10 of this Supplement. The Company and Burlington Northern Inc. ("BNI")
commenced a tender offer on December 23, 1994 (the "Joint Offer") for up to
63,000,000 Shares at $20.00 per Share. See Section 9 of this Supplement.
Except as otherwise set forth in this Supplement, the terms and conditions
previously set forth in the Offer to Purchase remain applicable in all respects
to the Offer, and this Supplement should be read in conjunction with the Offer
to Purchase. Unless the context requires otherwise, terms not defined herein
have the meanings ascribed to them in the Offer to Purchase.
THE OFFER IS NOW CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING
VALIDLY TENDERED PRIOR TO THE EXPIRATION OF THE OFFER AND NOT WITHDRAWN A NUMBER
OF SHARES WHICH, WHEN ADDED TO THE SHARES BENEFICIALLY OWNED BY THE PURCHASER
AND ITS AFFILIATES, CONSTITUTES AT LEAST A MAJORITY OF THE SHARES OUTSTANDING ON
A FULLY DILUTED BASIS (THE "MINIMUM CONDITION"), (2) THE COMPANY HAVING ENTERED
INTO A DEFINITIVE MERGER AGREEMENT WITH PARENT AND THE PURCHASER TO PROVIDE FOR
THE ACQUISITION OF THE COMPANY PURSUANT TO THE OFFER AND THE PROPOSED MERGER
(THE "MERGER AGREEMENT CONDITION"), (3) THE STOCKHOLDERS OF THE COMPANY NOT
HAVING APPROVED THE AGREEMENT AND PLAN OF MERGER BETWEEN THE COMPANY AND BNI
(THE "STOCKHOLDER VOTE CONDITION"), (4) THE PURCHASER BEING SATISFIED THAT
SECTION 203 OF THE DGCL HAS BEEN COMPLIED WITH OR IS INVALID OR OTHERWISE
INAPPLICABLE TO THE OFFER AND THE PROPOSED MERGER, (5) THE PURCHASER BEING
SATISFIED THAT THE BNI/SFP AGREEMENT HAS BEEN TERMINATED IN ACCORDANCE WITH ITS
TERMS, (6) THE PURCHASER BEING SATISFIED THAT THE RIGHTS HAVE BEEN REDEEMED BY
THE COMPANY OR THE RIGHTS ARE UNENFORCEABLE OR OTHERWISE INAPPLICABLE TO THE
OFFER AND THE PROPOSED MERGER (THE "RIGHTS CONDITION") AND (7) THE ABSENCE OF
ANY JUDICIAL, ADMINISTRATIVE OR OTHER DETERMI-
3
<PAGE> 4
NATION INVALIDATING, MODIFYING OR IMPOSING LIMITATIONS UNACCEPTABLE TO
THE PURCHASER ON THE INTERSTATE COMMERCE COMMISSION'S (THE "ICC") APPROVAL OF
THE PURCHASER'S USE OF A VOTING TRUST (THE "VOTING TRUST CONDITION"). THE OFFER
IS NOT CONDITIONED UPON APPROVAL BY THE ICC OF THE PURCHASER'S ACQUISITION OF
CONTROL OF THE COMPANY. IF THE STOCKHOLDERS OF THE COMPANY APPROVE THE BNI/SFP
AGREEMENT, THE PURCHASER WILL TERMINATE THE OFFER. AS DESCRIBED HEREIN, THE
PURCHASER WILL WAIVE THE MERGER AGREEMENT CONDITION UPON THE OCCURRENCE OF
CERTAIN EVENTS.
THIS SUPPLEMENT DOES NOT CONSTITUTE A SOLICITATION OF PROXIES FOR ANY
MEETING OF THE COMPANY'S STOCKHOLDERS. PARENT IS CURRENTLY SOLICITING PROXIES IN
OPPOSITION TO THE BNI/SFP AGREEMENT (AS HEREINAFTER DEFINED). SUCH SOLICITATION
BY PARENT IS BEING MADE ONLY PURSUANT TO SEPARATE PROXY MATERIALS COMPLYING WITH
THE REQUIREMENTS OF SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED (THE "EXCHANGE ACT"). IN ADDITION, THIS SUPPLEMENT IS NEITHER AN OFFER
TO SELL NOR A SOLICITATION OF OFFERS TO BUY ANY SECURITIES WHICH MAY BE ISSUED
IN ANY MERGER OR SIMILAR BUSINESS COMBINATION INVOLVING THE PURCHASER, PARENT OR
THE COMPANY.
The Minimum Condition. The Minimum Condition requires that the number of
Shares tendered before the expiration of the Offer and not withdrawn prior to
the acceptance of the Shares for payment, together with the Shares beneficially
owned by the Purchaser and its affiliates, represent at least a majority of the
Shares outstanding on a fully diluted basis. According to the BNI and Santa Fe
Pacific Corporation Joint Offer to Purchase, dated December 23, 1994, as
supplemented by the Supplement, dated January 13, 1995 (collectively, the "Joint
Offer to Purchase"), which is an exhibit to BNI's Statement on Schedule 14D-1,
as amended, and the Company's Statement on Schedule 13E-4, as amended, each of
which was filed with the Securities and Exchange Commission (the "Commission")
pursuant to the Exchange Act, as of December 31, 1994, there were 188,301,537
Shares outstanding and 14,470,071 unexercised options to acquire Shares under
various employee stock option plans of the Company. Parent beneficially owns 200
Shares. Based on the foregoing and assuming no additional Shares have been
issued since December 31, 1994 (other than Shares issued pursuant to the
exercise of the stock options referred to above), if the Purchaser purchases
101,385,605 Shares pursuant to the Offer, the Minimum Condition will be
satisfied. For purposes of the Offer, "fully diluted basis" assumes that all
outstanding stock options are presently exercisable.
The Merger Agreement Condition. The Merger Agreement Condition requires
that the Company enter into a definitive merger agreement with Parent and the
Purchaser that would provide for the acquisition of the Company by the Purchaser
pursuant to the Offer and the Proposed Merger. In order for the Merger Agreement
Condition to be satisfied, the Board of Directors of Parent, the Purchaser and
the Company must approve the merger agreement.
THE PURCHASER WILL WAIVE THE MERGER AGREEMENT CONDITION IF AT LEAST 90% OF
THE OUTSTANDING SHARES HAVE BEEN TENDERED BEFORE THE EXPIRATION OF THE OFFER AND
NOT WITHDRAWN, ALL OTHER CONDITIONS TO THE OFFER HAVE BEEN SATISFIED OR WAIVED
AND (1) THE PURCHASER IS SATISFIED IN ITS SOLE DISCRETION THAT, IMMEDIATELY
FOLLOWING THE CONSUMMATION OF THE OFFER, THE PURCHASER WILL HAVE THE ABILITY TO
EFFECTUATE A SHORT-FORM MERGER UNDER SECTION 253 OF THE DGCL (THE "SHORT-FORM
MERGER") AND (2) THE PURCHASER HAS RECEIVED A FAVORABLE INFORMAL, NON-BINDING
OPINION OF THE ICC STAFF WITH RESPECT TO, OR ICC APPROVAL OF, AN AMENDMENT TO
THE VOTING TRUST AGREEMENT TO ENABLE THE TRUSTEE TO TAKE ACTIONS TO CAUSE THE
COMPANY TO COOPERATE WITH THE PURCHASER IN OBTAINING APPROVAL OF THE ICC OF THE
ACQUISITION OF CONTROL OF THE COMPANY BY PARENT (THE "ICC CONTROL APPROVAL").
SUCH ACTIONS WOULD INCLUDE (I) AMENDING THE COMPANY'S CERTIFICATE OF
INCORPORATION, IN CONNECTION WITH EFFECTING THE SHORT-FORM MERGER, TO ELIMINATE
THE CLASSIFIED FORM OF THE COMPANY'S BOARD OF DIRECTORS AND TO ENABLE THE
TRUSTEE TO REMOVE THE COMPANY'S DIRECTORS WITHOUT CAUSE AND (II) PROVIDING THAT
THE TRUSTEE WOULD ELECT NEW DIRECTORS OF THE COMPANY WHO ARE COMMITTED TO
ENTERING INTO AN AGREEMENT TO COOPERATE WITH THE PURCHASER IN OBTAINING THE ICC
CONTROL APPROVAL AND WHO ARE COMMITTED TO MAINTAIN THE INTEGRITY OF THE
COMPANY'S RAILROAD BUSINESS PENDING RECEIPT OF THE ICC CONTROL APPROVAL.
ALTHOUGH FAVORABLE ICC ACTION WITH RESPECT TO THE AMENDMENT TO THE VOTING TRUST
AGREEMENT IS EXPECTED, THERE CAN BE NO ASSURANCE THAT SUCH ACTION WILL BE
FORTHCOMING. THE PURCHASER INTENDS TO SEEK ICC APPROVAL OF SUCH AMENDMENT TO THE
VOTING TRUST AGREEMENT AT SUCH TIME AS THE PURCHASER IS SATISFIED THAT
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<PAGE> 5
THE BNI/SFP MERGER AGREEMENT HAS NOT BEEN APPROVED BY THE COMPANY'S STOCKHOLDERS
AT THE SPECIAL MEETING (AS DEFINED HEREIN).
In the Short-Form Merger, each Share that is issued and outstanding
immediately prior to the effective time of the Short-Form Merger (other than
Shares held in the treasury of the Company or owned by Parent, the Purchaser or
any direct or indirect wholly-owned subsidiary of Parent and other than
Dissenting Shares) would be converted into the right to receive $18.50 in cash.
On October 5, 1994, Parent made a proposal to acquire the Company in a
negotiated merger transaction in which the Company's stockholders would receive,
per Share, 0.344 of a share of common stock, par value $2.50 per share, of
Parent ("Parent Common Stock"), and communicated to the Company its desire to
negotiate a definitive merger agreement on mutually acceptable terms and
conditions. See Section 10 of the Offer to Purchase. On October 30, 1994, Parent
revised its proposal such that the Company's stockholders would receive, per
Share, 0.407 of a share of Parent Common Stock, and reaffirmed its desire to
negotiate a definitive agreement with the Company.
On November 8, 1994, Parent again revised its proposal to provide that
Parent would acquire the Company in a two-step transaction in which Parent would
purchase 57.1% of the outstanding Shares on a fully diluted basis in a cash
tender offer for $17.50 per Share. Parent would acquire the remaining Shares in
a merger in which the Company's stockholders would receive, for each of their
remaining Shares, 0.354 of a share of Parent Common Stock. On January 18, 1995,
Parent amended the Offer to provide that Parent would purchase all of the
outstanding Shares for $18.50 per Share, net to the tendering stockholder in
cash. Any Shares not tendered in the Offer will be converted in the Proposed
Merger into the right to receive $18.50 in cash. Pursuant to this proposal,
Shares acquired in the Offer and the Proposed Merger would be held in the Voting
Trust until ICC Control Approval is obtained.
According to the BNI and Santa Fe Pacific Corporation Joint Proxy
Statement/Prospectus, dated January 13, 1995 (the "Santa Fe Joint Proxy
Statement"), the Company is currently soliciting proxies from its stockholders
to vote on the proposed merger of the Company and BNI. The Company, according to
the Santa Fe Joint Proxy Statement, has set February 7, 1995 as the date for a
special meeting at which stockholders of the Company will vote with respect to
the proposed merger of the Company and BNI. The Company and BNI have entered
into an Agreement and Plan of Merger, dated as of June 29, 1994, as amended by
Amendment, dated as of October 26, 1994, and Amendment No. 2, dated as of
December 18, 1994 (such Agreement prior to such amendments, the "Original
BNI/SFP Agreement" and, as so amended, the "BNI/SFP Agreement"), between the
Company and BNI. Pursuant to the BNI/SFP Agreement, the Company and BNI
commenced a tender offer on December 23, 1994 (the "Joint Offer") for up to
63,000,000 Shares (together with the associated Rights) at $20.00 per Share, net
to the tendering stockholder in cash. According to the BNI/SFP Agreement, to the
extent that the Joint Offer is consummated, and subject to the approval of the
BNI/SFP Agreement by the stockholders of BNI and the Company, the Company
intends to merge into BNI pursuant to which each outstanding Share not purchased
in the Joint Offer will be converted into a right to receive 0.40 shares of BNI
common stock, no par value per share (the "BNI Common Stock"). See Section 9 of
this Supplement.
Parent is presently soliciting proxies from stockholders of the Company to
vote against the proposed merger with BNI. In Parent's Proxy Statement, dated
October 28, 1994, as supplemented by the First Supplement and the Second
Supplement (the "Parent Proxy Statement"), Parent has stated that, if the
Company's stockholders approve the proposed merger with BNI, Parent will
terminate the Offer. See Section 10 of the Offer to Purchase and Section 9 of
this Supplement.
Parent has moved the Court of Chancery in the State of Delaware for leave
to file a Second Amended and Supplemental Complaint (the "Second Amended
Complaint") seeking, among other things, a final order (a) requiring the Company
to adopt fair and equitable procedures for the consideration of competing bids
for the Company, (b) enjoining the operation of the Rights pursuant to the
Rights Agreement and declaring the Rights inapplicable or unenforceable as
applied to the Offer and the Proposed Merger, (c) declaring that the termination
fee and expense reimbursement provisions of the BNI/SFP Agreement are invalid
and
5
<PAGE> 6
unenforceable; and (d) declaring that Parent has not tortiously interfered with
the contractual or other legal rights of BNI or the Company. See Section 15 of
the Offer to Purchase and Section 12 of this Supplement.
To the extent the Purchaser has not waived the Merger Agreement Condition
in accordance with the second paragraph of this subsection, the Purchaser
presently intends to extend the Offer from time to time until the Merger
Agreement Condition is satisfied or the Purchaser determines, in its sole
discretion, that such condition is not reasonably likely to be satisfied under
then current circumstances. If the Purchaser determines at any time in its sole
discretion that it is unlikely that the Merger Agreement Condition will be
satisfied or waived, the Purchaser will terminate the Offer.
The Stockholder Vote Condition. The Stockholder Vote Condition requires
that the Company's stockholders not approve the BNI/SFP Agreement at the Special
Meeting of Stockholders of the Company scheduled for February 7, 1995 or any
postponements, adjournments or reschedulings thereof (the "Special Meeting").
Parent is presently soliciting proxies from stockholders of the Company to vote
against approval of the BNI/SFP Agreement. Such solicitation is being made
pursuant to separate proxy materials complying with the requirements of Section
14(a) of the Exchange Act. If the stockholders of the Company approve the
BNI/SFP Agreement at the Special Meeting, the Purchaser will terminate the Offer
as a result of the failure of the Stockholder Vote Condition.
The Rights Condition. The Rights Condition requires that the Purchaser be
satisfied in its sole judgment that either the Rights have been redeemed by the
Company or the Rights are unenforceable or otherwise inapplicable to the Offer
and the Proposed Merger. See Section 6 of this Supplement. A copy of the Rights
Agreement was filed with the Commission as an Exhibit to the Company's
Registration Statement on Form 8-A, dated November 28, 1994 (the "Company 8-A"),
and should be available for inspection, and copies may be obtained, in the same
manner as set forth in Section 7 of the Offer to Purchase.
Parent believes that the Rights Agreement, as currently in effect, violates
applicable law and that under the circumstances of the Offer and applicable law,
the Board of Directors of the Company has a fiduciary responsibility to redeem
the Rights. Parent has moved the Court of Chancery in the State of Delaware for
leave to file its Second Amended Complaint seeking, among other things, an order
enjoining the operation of the Rights and declaring that the Rights are
inapplicable or unenforceable as applied to the Offer and the Proposed Merger.
The Voting Trust Condition. Parent has received an informal, non-binding,
staff opinion from the ICC authorizing the use of a Voting Trust in its proposed
combination with the Company. The receipt of such opinion was described in the
Offer to Purchase as the Voting Trust Approval Condition to the Offer. The ICC
also issued an order of the full Commission approving the Voting Trust.
Consummation of the Offer is now conditioned upon the absence of any judicial,
administrative or other determination invalidating, modifying or imposing
limitations unacceptable to the Purchaser on the ICC's approval of the use of a
Voting Trust to acquire control of the Company.
Certain other conditions to consummation of the Offer are described in
Section 11 of this Supplement. The Purchaser expressly reserves the right to
waive any one or more of the conditions to the Offer. See Section 11 of this
Supplement.
THE OFFER TO PURCHASE, THIS SUPPLEMENT AND THE REVISED LETTER OF
TRANSMITTAL CONTAIN IMPORTANT INFORMATION WHICH SHOULD BE READ CAREFULLY BEFORE
ANY DECISION IS MADE WITH RESPECT TO THE OFFER.
1. AMENDED TERMS OF THE OFFER. The terms of the Offer are set forth in
Section 1 of the Offer to Purchase as supplemented by Section 1 of this
Supplement.
The Offer is being made for all of the outstanding Shares. The price per
Share to be paid pursuant to the Offer has been increased from $17.50 per Share
to $18.50 per Share, net to the seller in cash and without interest thereon.
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any extension or
amendment), the Purchaser will accept for payment and pay the increased price
for all of the Shares validly tendered prior to the Expiration Date (as
hereinafter
6
<PAGE> 7
defined) and not withdrawn in accordance with Section 4 of the Offer to Purchase
and Section 3 of this Supplement (including Shares tendered prior to the date of
this Supplement). The term "Expiration Date" means 12:00 Midnight, New York City
time, on Tuesday, February 7, 1995 unless and until the Purchaser, in its sole
discretion, shall have extended the period of time during which the Offer is
open, in which event the term "Expiration Date" shall mean the latest time and
date at which the Offer, as so extended by the Purchaser, shall expire.
Consummation of the Offer is conditioned upon, among other things,
satisfaction of the Minimum Condition, the Merger Agreement Condition, the
Stockholder Vote Condition, the Rights Condition and the Voting Trust Condition.
If any or all of such conditions are not satisfied or any or all of the other
events set forth in Section 11 of this Supplement shall have occurred or shall
be determined by the Purchaser to have occurred prior to the Expiration Date,
the Purchaser reserves the right (but shall not be obligated) to (i) decline to
purchase any or all of the Shares tendered and terminate the Offer, and return
all tendered Shares to tendering stockholders, (ii) waive or reduce the Minimum
Condition or waive or reduce any or all other conditions and, subject to
complying with applicable rules and regulations of the Commission, purchase all
Shares validly tendered, or (iii) extend the Offer and, subject to the right of
stockholders to withdraw Shares (as specified in Section 4 of the Offer to
Purchase and Section 3 of the Supplement) retain the Shares which have been
tendered during the period or periods for which the Offer is extended.
The Purchaser expressly reserves the right, in its sole discretion, at any
time and from time to time, to extend for any reason the period of time during
which the Offer is open, including the occurrence of any of the events specified
in Section 11 of this Supplement, by giving oral or written notice of such
extension to the Depositary. During any such extension, all Shares previously
tendered and not withdrawn will remain subject to the Offer, subject to the
rights of a tendering stockholder to withdraw its Shares. See Section 4 of the
Offer to Purchase and Section 3 of this Supplement.
Subject to the applicable regulations of the Commission, the Purchaser also
expressly reserves the right, in its sole discretion at any time and from time
to time, (i) to delay acceptance for payment of, or, regardless of whether such
Shares were theretofore accepted for payment, payment for, any Shares pending
receipt of any regulatory approval specified in Section 15 of the Offer to
Purchase and Section 12 of this Supplement (other than ICC Control Approval) or
in order to comply in whole or in part with any other applicable law, (ii) to
terminate the Offer and not accept for payment any Shares if any of the
conditions referred to in Section 11 of this Supplement has not been satisfied
or upon the occurrence of any of the events specified in Section 11 of this
Supplement and (iii) to waive any condition or otherwise amend the Offer in any
respect by giving oral or written notice of such delay, termination, waiver or
amendment to the Depositary and by making a public announcement thereof.
On or about January 18, 1995, the Purchaser sent or gave this Supplement
and the revised Letter of Transmittal and other relevant materials to the
Company's stockholders and sent or gave such materials, for subsequent
transmittal to beneficial owners of Shares, to brokers, dealers, commercial
banks, trust companies and similar persons whose names, or the names of whose
nominees, appear on the stockholder list of the Company or, if applicable, who
are listed as participants in a clearing agency's security position listing.
2. PROCEDURES FOR TENDERING SHARES. Procedures for tendering Shares are
set forth in Section 3 of the Offer to Purchase, as supplemented by this Section
2 of this Supplement.
Tendering stockholders should use the revised GREEN Letter of Transmittal
or the revised YELLOW Notice of Guaranteed Delivery included with this
Supplement. However, to the extent the GREEN Letter of Transmittal or the
revised YELLOW Notice of Guaranteed Delivery is not obtainable, tendering
stockholders may continue to use the GOLD Letter of Transmittal and the BLUE
Notice of Guaranteed Delivery that were provided with the Offer to Purchase.
Although such GOLD Letter of Transmittal indicates that the Offer will expire at
12:00 Midnight, New York City time, on Thursday, December 8, 1994, stockholders
will be able to tender their Shares pursuant to the Offer until 12:00 Midnight,
New York City time, on Tuesday, February 7, 1995 (or such later date to which
the Offer may be extended). STOCKHOLDERS WHO HAVE PREVIOUSLY VALIDLY TENDERED
SHARES PURSUANT TO THE OFFER USING THE GOLD LETTER OF TRANSMITTAL OR THE BLUE
NOTICE OF
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<PAGE> 8
GUARANTEED DELIVERY AND WHO HAVE NOT PROPERLY WITHDRAWN SUCH SHARES HAVE VALIDLY
TENDERED SUCH SHARES FOR THE PURPOSES OF THE OFFER, AS AMENDED, AND NEED NOT
TAKE ANY FURTHER ACTION.
Unless the Rights are redeemed prior to the expiration of the Offer,
stockholders will be required to tender one Right for each Share tendered in
order to effect a valid tender of such Share. If Right Certificates (as defined
herein) have been distributed to holders of Shares prior to the date of tender
pursuant to the Offer, Right Certificates representing a number of Rights equal
to the number of Shares being tendered must be delivered to the Depositary in
order for such Shares to be validly tendered. If Right Certificates have not
been distributed prior to the time Shares are tendered pursuant to the Offer, a
tender of Shares without Rights constitutes an agreement by the tendering
stockholder to deliver Right Certificates representing a number of Rights equal
to the number of Shares tendered pursuant to the Offer to the Depositary within
five New York Stock Exchange, Inc. ("NYSE") trading days after the date Right
Certificates are distributed. The Purchaser reserves the right to require that
it receive such Right Certificates prior to accepting Shares for payment.
Payment for Shares tendered and accepted for payment pursuant to the Offer will
be made only after timely receipt by the Depositary of, among other things,
Right Certificates, if such certificates have been distributed to holders of
Shares. The Purchaser will not pay any additional consideration for the Rights
tendered pursuant to the Offer.
3. WITHDRAWAL RIGHTS. The discussion set forth in Section 4 of the Offer
to Purchase is hereby amended and supplemented as follows:
Shares tendered pursuant to the Offer may be withdrawn at any time prior to
the acceptance for payment of Shares in the Offer.
Shareholders who have previously tendered their Shares in the Joint Offer
and who desire assistance in withdrawing such Shares or who would like to obtain
a Notice of Withdrawal should contact the Information Agent in the manner
specified on the back cover of this Supplement.
4. CERTAIN FEDERAL INCOME TAX CONSEQUENCES. The discussion set forth in
Section 5 of the Offer to Purchase is hereby amended and restated as follows:
The following discussion is a summary of the material federal income tax
consequences of the Offer and Proposed Merger to holders of Shares who hold the
Shares as capital assets. The discussion set forth below is for general
information only and may not apply to particular categories of holders of Shares
subject to special treatment under the Internal Revenue Code of 1986, as amended
(the "Code"), such as foreign holders and holders who acquired such Shares
pursuant to an exercise of an employee stock option or otherwise as
compensation.
Consequences of the Offer and the Proposed Merger Generally. If the
Proposed Merger is consummated, the Offer and Proposed Merger should be treated
as a single integrated transaction for federal income tax purposes, and the
Offer and Proposed Merger together would be a taxable transaction for federal
income tax purposes and may be a taxable transaction for foreign, state and
local income tax purposes as well. If, for any reason, the Proposed Merger were
not consummated, the receipt of cash pursuant to the Offer would still be a
taxable exchange.
In general, a stockholder of the Company who, pursuant to the Offer and/or
the Proposed Merger, exchanges Shares for cash will recognize capital gain or
loss on the date of acceptance of Shares for purchase pursuant to the Offer or
at the effective time of the Proposed Merger, as the case may be, in an amount
equal to the difference between the amount of cash received and the
stockholder's adjusted tax basis in the Shares accepted for payment in the Offer
or surrendered in the Proposed Merger. The gain or loss will be long-term
capital gain or loss if, as of the date of the exchange pursuant to the Offer or
as of the effective time of the Proposed Merger, the holder thereof has held
such Shares for more than one year.
If a holder of Shares owns more than one "block" of stock (i.e., Shares
acquired at the same time in a single transaction) gain or loss must be
determined separately for each block held. In general, the amount of cash
received must be allocated ratably among the blocks in the proportion that the
number of Shares in a particular block bears to the total number of Shares held
by such stockholder.
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<PAGE> 9
Withholding. Unless a stockholder complies with certain reporting and/or
certification procedures or is an exempt recipient under applicable provisions
of the Code and Treasury Regulations promulgated thereunder, such stockholder
may be subject to withholding tax of 31% with respect to any cash payments
received pursuant to the Offer and Proposed Merger. Stockholders should consult
their brokers to ensure compliance with such procedures. Foreign stockholders
should consult with their own tax advisors regarding withholding taxes in
general.
THE ABOVE DISCUSSION MAY NOT APPLY TO PARTICULAR CATEGORIES OF HOLDERS OF
SHARES SUBJECT TO SPECIAL TREATMENT UNDER THE CODE, SUCH AS FOREIGN HOLDERS AND
HOLDERS WHOSE SHARES WERE ACQUIRED PURSUANT TO THE EXERCISE OF AN EMPLOYEE STOCK
OPTION OR OTHERWISE AS COMPENSATION. STOCKHOLDERS OF THE COMPANY ARE URGED TO
CONSULT THEIR OWN TAX ADVISORS TO DETERMINE THE SPECIFIC TAX CONSEQUENCES OF THE
OFFER AND THE PROPOSED MERGER, INCLUDING ANY STATE, LOCAL OR OTHER TAX
CONSEQUENCES OF THE OFFER AND THE PROPOSED MERGER.
5. PRICE RANGE OF SHARES; DIVIDENDS. The discussion set forth in Section 6
of the Offer to Purchase is hereby amended and supplemented as follows:
The following table sets forth, for the quarters indicated, the high and
low sales prices per Share on the NYSE as reported by the Dow Jones News
Service.
<TABLE>
<CAPTION>
MARKET PRICE
-------------
HIGH LOW
---- ----
<S> <C> <C>
FISCAL YEAR ENDED DECEMBER 31, 1994:
Fourth Quarter..................................................... $17 5/8 $12 1/8
FISCAL YEAR ENDING DECEMBER 31, 1995:
First Quarter (Through January 17, 1995)........................... 17 7/8 17 3/8
</TABLE>
On January 17, 1995, the last full trading day prior to Parent's
announcement that it was amending the Offer upon the terms set forth in this
Supplement, the closing sale price per Share as reported on the NYSE was
$17 7/8. STOCKHOLDERS ARE URGED TO OBTAIN A CURRENT MARKET QUOTATION FOR THE
SHARES.
6. CERTAIN INFORMATION CONCERNING THE COMPANY. The discussion set forth in
Section 7 of the Offer to Purchase is hereby amended and supplemented as
follows:
The Rights. The following is a summary of the material terms of the Rights
Agreement. This summary is qualified in its entirety by reference to the Rights
Agreement, a copy of which was filed with the Commission as an Exhibit to the
Company 8-A and should be available for inspection, and copies may be obtained,
in the same manner as set forth in Section 7 of the Offer to Purchase. The
Company 8-A describes the Rights as follows:
On November 28, 1994, the Board of Directors of [the Company] declared
a dividend distribution of one Right for each outstanding share of common
stock, par value $1.00 per share (the "Common Stock") of the Company to
stockholders of record at the close of business on December 9, 1994 (the
"Record Date"). Except as described below, each Right, when exercisable,
entitles the registered holder to purchase from the Company one
one-hundredth of a share of Series A Junior Participating Preferred Stock,
par value $1.00 per share (the "Preferred Stock"), at a purchase price of
$50.00 per one one-hundredth of a Preferred Share (the "Purchase Price"),
subject to adjustment. The description and terms of the Rights are set
forth in [the Rights Agreement].
Initially, the Rights will be attached to all Common Stock
certificates representing shares then outstanding, and no separate Right
Certificates will be distributed. Until the earlier to occur of (i) 10 days
following a public announcement that a person or group of affiliated or
associated persons (an "Acquiring Person") has acquired, or obtained the
right to acquire, beneficial ownership of 10% or more of the outstanding
shares of Common Stock (the "Shares Acquisition Date") or (ii) 15 business
days (or such later date as may be determined by action of the Board of
Directors of the Company (the "Board of Directors") prior to the time that
any person becomes an Acquiring Person) following the commencement of (or a
public announcement of an intention to make) a tender or exchange offer if,
upon
9
<PAGE> 10
consummation thereof, such person or group would be the beneficial owner of
10% or more of such outstanding shares of Common Stock (the earlier of such
dates being called the "Distribution Date"), the Rights will be evidenced
by the Common Stock certificates together with a copy of the Summary of
Rights Plan and not by separate certificates.
The Rights Agreement also provides that, until the Distribution Date,
the Rights will be transferred with and only with the Common Stock. Until
the Distribution Date (or earlier redemption, expiration or termination of
the Rights), the transfer of any certificates for Common Stock with or
without a copy of [the] Summary of Rights Plan will also constitute the
transfer of the Rights associated with the Common Stock represented by such
certificates. As soon as practicable following the Distribution Date,
separate certificates evidencing the Rights ("Right Certificates") will be
mailed to holders of record of the Common Stock as of the close of business
on the Distribution Date and, thereafter, such separate Right Certificates
alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date and will
expire at the earliest of (i) December 9, 2004 (the "Final Expiration
Date"), (ii) the redemption of the Rights by the Company as described
below, (iii) the time immediately prior to the effectiveness of the merger
of the Company with and into [BNI] pursuant to the [BNI/SFP Agreement], as
such [agreement] may be amended from time to time, and (iv) the exchange of
all Rights for Common Stock as described below.
In the event that any person (other than the Company, its affiliates
or any person receiving newly-issued shares of Common Stock directly from
the Company) becomes the beneficial owner of 10% or more of the then
outstanding shares of Common Stock, each holder of a Right will thereafter
have the right to receive, upon exercise at the then current exercise price
of the Right, Common Stock (or, in certain circumstances, cash, property or
other securities of the Company) having a value equal to two times the
exercise price of the Right. The Rights Agreement contains an exemption for
any issuance of Common Stock by the Company directly to any person (for
example, in a private placement or an acquisition by the Company in which
Common Stock is used as consideration), even if that person would become
the beneficial owner of 10% or more of the Common Stock, provided that such
person does not acquire any additional shares of Common Stock.
In the event that, at any time following the Shares Acquisition Date,
the Company is acquired in a merger or other business combination
transaction or 50% or more of the Company's assets or earning power are
sold, proper provision will be made so that each holder of a Right will
thereafter have the right to receive, upon exercise at the then current
exercise price of the Right, common stock of the acquiring or surviving
company having a value equal to two times the exercise price of the Right.
Notwithstanding the foregoing, following the occurrence of any of the
events set forth in the preceding two paragraphs (the "Triggering Events"),
any Rights that are, or (under certain circumstances specified in the
Rights Agreement) were, beneficially owned by any Acquiring Person will
immediately become null and void.
The Purchase Price payable, and the number of shares of Preferred
Stock or other securities or property issuable, upon exercise of the
Rights, are subject to adjustment from time to time to prevent dilution,
among other circumstances, in the event of a stock dividend on, or a
subdivision, split, combination, consolidation or reclassification of, the
Preferred Stock or the Common Stock, or a reverse split of the outstanding
shares of Preferred Stock or the Common Stock.
At any time after the acquisition by a person or group of affiliated
or associated persons of beneficial ownership of 10% or more of the
outstanding Common Stock and prior to the acquisition by such person or
group of 50% or more of the outstanding Common Stock, the Board of
Directors may exchange the Rights (other than Rights owned by such person
or group, which have become void), in whole or in part, at an exchange
ratio of one share of Common Stock per Right (subject to adjustment).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1%
in the Purchase Price. The Company will not be required to issue fractional
shares of Preferred Stock or Common Stock (other than fractions in
multiples
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of one one-hundredths of a share of Preferred Stock) and, in lieu thereof,
an adjustment in cash may be made based on the market price of the
Preferred Stock or Common Stock on the last trading date prior to the date
of exercise.
At any time after the date of the Rights Agreement until the time that
a person becomes an Acquiring Person, the Board of Directors may redeem the
Rights in whole, but not in part, at a price of $.01 per Right (the
"Redemption Price"), which may (at the option of the Company) be paid in
cash, shares of Common Stock or other consideration deemed appropriate by
the Board of Directors. Upon the effectiveness of any action of the Board
of Directors ordering redemption of the Rights, the Rights will terminate
and the only right of the holders of Rights will be to receive the
Redemption Price.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the
right to vote or to receive dividends.
The provisions of the Rights Agreement may be amended by the Company,
except that any amendment adopted after the time that a person becomes an
Acquiring Person may not adversely affect the interests of holders of
Rights.
. . . Each outstanding share of Common Stock on December 9, 1994 will
receive one Right. Two million five hundred thousand (2,500,000) shares of
Preferred Stock will be reserved for issuance in the event of exercise of
the Rights.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the
Company without conditioning the offer on the Rights being redeemed or a
substantial number of Rights being acquired, and under certain
circumstances the Rights beneficially owned by such a person or group may
become void. The Rights should not interfere with any merger or other
business combination approved by the Board of Directors because, if the
Rights would become exercisable as a result of such merger or business
combination, the Board of Directors may, at its option, at any time prior
to the time that any Person becomes an Acquiring Person, redeem all (but
not less than all) of the then outstanding Rights at the Redemption Price.
On November 29, 1994, the Company announced that its Board of Directors had
postponed the Distribution Date until December 16, 1994. On December 15, 1994,
the Company announced that its Board of Directors had postponed the Distribution
Date until January 31, 1995.
7. CERTAIN INFORMATION CONCERNING THE PURCHASER AND PARENT. The discussion
set forth in Section 8 of the Offer to Purchase is hereby amended and
supplemented as follows:
On December 31, 1994, Parent consummated the previously announced sale of
its waste management subsidiary, USPCI, Inc., to Laidlaw, Inc. for $225 million
plus the assumption of certain financial and other liabilities.
8. SOURCE AND AMOUNT OF FUNDS. The discussion set forth in Section 9 of
the Offer to Purchase is hereby amended and supplemented as follows:
As a result of the amended Offer, the Purchaser now estimates that the
total amount of funds necessary to acquire the outstanding Shares pursuant to
the Offer and the Proposed Merger and to pay related fees and expenses will be
approximately $3.8 billion.
As stated in the Offer to Purchase, the Purchaser plans to obtain the
necessary funds through capital contributions or advances made by Parent. Parent
initially planned to obtain at least a portion of the funds for such capital
contributions or advances from its loan facilities to be established pursuant to
a commitment letter (the "Commitment"), dated November 9, 1994, among Parent,
Citicorp Securities, Inc., Credit Suisse and NationsBank Capital Markets, Inc.,
as co-arrangers, and Citibank, N.A., Credit Suisse and NationsBank of North
Carolina, N.A., as co-administrative agents, to provide Parent and the Purchaser
with a revolving credit facility (the "Facility") in the amount of $2 billion.
The commitment of the banks pursuant to the Commitment is subject to negotiation
and execution of a definitive credit agreement with respect to the Facility and
related documents. The Commitment is subject to certain specified conditions
including, among
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other things, (i) the absence of a material adverse change in the business,
financial condition, operations, performance or properties of Parent, or Parent
and its subsidiaries taken as a whole, since December 31, 1993, except as
disclosed in Parent's most recent annual report on Form 10-K or in its quarterly
reports on Form 10-Q for the first two fiscal quarters of 1994, (ii) the absence
of any change in loan syndication, financial or capital market conditions
generally that, in the reasonable judgment of the co-arrangers, would materially
impair syndication of the Facility, (iii) the absence of a material change in
the terms of the Offer as announced on November 8, 1994 and (iv) the absence of
any litigation or other proceedings that could reasonably be expected to have a
material adverse effect upon the syndication of the Facility or upon the
business, financial condition, operations, performance or properties of Parent,
or Parent and its subsidiaries taken as a whole. The Commitment terminates on
February 10, 1995, unless extended, if definitive credit documentation has not
been executed prior to that date. The Purchaser is engaged in discussions with
these lenders to increase the size of the facility to an amount sufficient to
obtain all funds necessary to acquire the outstanding Shares pursuant to the
Offer and the Proposed Merger and to pay related fees and expenses. In addition,
the Purchaser is also engaged in discussions with the lenders concerning the
possible waiver or modification of condition (iii) described above. There can be
no assurance that these discussions will result in an increase in the size of
the facility or a waiver or modification of condition (iii).
The final maturity of the Facility is expected to be up to five years from
the date the definitive credit documentation is executed. The interest on the
drawings under the Facility is expected to be in the range of .325% to 1.00%
above the London Interbank Offered Rate per annum, based on Parent's credit
rating. Alternatively, at Parent's option, the interest on the drawings may be
calculated at a specified percentage above a base rate, as determined by the
parties, or through a competitive bid or special rate loan procedure.
The proceeds of the Facility will be made available to finance the payment
obligations arising out of the Offer and the Proposed Merger. Additional funds
which are required to acquire the outstanding Shares pursuant to the Offer and
the Proposed Merger will be obtained in the manner described in Section 9 of the
Offer to Purchase.
9. BACKGROUND OF THE OFFER SINCE NOVEMBER 9, 1994; CONTACTS WITH THE
COMPANY. The discussion set forth in Section 10 of the Offer to Purchase is
hereby amended and supplemented as follows:
On November 9, 1994, Parent announced that it had commenced the Offer.
On November 10, 1994, Parent published a summary advertisement announcing
the commencement of the Offer. Also on November 10, Parent announced that it had
signed a commitment letter with a group of banks to provide aggregate financing
of $2 billion for the Offer.
According to the Joint Offer to Purchase, on November 11, 1994, the Company
requested that BNI consider restructuring the merger in response to the
Purchaser's announcement that it would establish the Voting Trust. BNI did not
make a substantive response to this request.
On November 13, 1994, Dick Davidson, President of Parent and Chairman and
Chief Executive Officer of Union Pacific Railroad Company, sent the following
letter to Robert D. Krebs, Chairman, President and Chief Executive Officer of
the Company:
November 13, 1994
Mr. Robert D. Krebs
Chairman, President & CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, Illinois 60173
Dear Rob:
I am writing to express our disappointment with your continued refusal
to discuss our proposal. Five days ago, we submitted a newly structured
proposal to negotiate an acquisition of Santa Fe. The value of
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<PAGE> 13
our proposed transaction represents a premium to the consideration in your
proposed Burlington Northern merger. We included a voting trust in order to
eliminate the risk to Santa Fe shareholders of ICC review of a Santa
Fe/Union Pacific combination. Although you have repeatedly said that you
would consider such a proposal, we have heard nothing from you.
We believe our proposal is superior to the Burlington Northern merger
in terms of price, timing and certainty. We assume you are talking with
Burlington Northern to see if they will improve their transaction. One
cannot conduct a fair auction by negotiating and sharing information with
only one of the bidders. In light of our current proposal, we believe it is
contrary to the best interests of your shareholders and a clear violation
of your Board of Directors' fiduciary duties for you to refuse to talk with
us.
It is not possible for you to "consider" our proposal fairly without
meeting with us. We are prepared to negotiate any and all of the
contractual terms of our draft merger agreement provided to you last
Thursday. For instance, as we indicated in our draft agreement, we are
prepared to discuss the conditions to our tender offer in the context of a
negotiated transaction. We are also prepared to discuss any issues you may
have concerning the structure of, or process for using, a voting trust.
We note that our draft merger agreement, unlike your agreement with
Burlington Northern, would provide Santa Fe with the right to terminate the
agreement in order to accept a superior competing offer. We strongly urge
that you not enter into any further agreement with Burlington Northern
(including any additional amendment to your existing merger agreement)
without including such a right of termination. This is especially
appropriate and important in light of our proposal.
Delaware law and your Board's fiduciary duties require that you
establish a level playing field. You have flexibility to achieve this
without violating your contractual obligations to Burlington Northern. It
is time for you to act in the best interest of your shareholders and in
accordance with your fiduciary obligations by meeting with us now.
Your shareholders' meeting is scheduled to be held in only five days.
Please call me so that we can arrange a time and place for a meeting.
Sincerely,
/s/ Dick Davidson
cc: Board of Directors
Santa Fe Pacific Corporation
On November 14, 1994, according to the Joint Offer to Purchase, Alleghany
Corporation ("Alleghany"), the holder of approximately 7% of the Shares, sent a
letter to the Company in which it indicated that it would be interested in
providing equity financing for a recapitalization of the Company designed to
permit the Company to remain as an independent company. Alleghany stated, by way
of illustration, that such a recapitalization might be financed through Company
borrowings and the purchase by Alleghany of up to $300 million of convertible
preferred stock of the Company.
On November 14, 1994, the Company issued a press release stating that the
Company's Board of Directors postponed the Special Meeting of Shareholders to
vote on the BNI/SFP Agreement until Friday, December 2, 1994.
On November 22, 1994, the Company's Board of Directors recommended that
stockholders not tender their Shares to Parent. The Company's
Solicitation/Recommendation Statement on Schedule 14D-9, dated November 22, 1994
(together with all amendments thereto, the "Schedule 14D-9"), disclosed that the
Board had based its recommendation on the following factors: (i) it is unclear
whether or when the ICC opinion will be issued on the Voting Trust and whether
the ICC may prevent Parent from using a Voting Trust; (ii) Parent's proposal is
a taxable transaction, whereas BNI's proposal is non-taxable; and (iii) Parent's
offer is subject to a number of other conditions which suggest that the proposal
is too uncertain to be considered a
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<PAGE> 14
firm alternative to the BNI/SFP Agreement. The Schedule 14D-9 stated that the
Company's Board believes that Parent should improve the financial terms of its
latest proposal. Also on November 22, 1994, Mr. Davidson sent the following
letter to Mr. Krebs commenting on, among other things, the Schedule 14D-9:
November 22, 1994
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, IL 60173
Dear Rob:
Two weeks ago, we submitted our revised proposal to negotiate an
acquisition of Santa Fe. Our terms and structure -- fair price and a voting
trust -- meet the criteria that you have set forth on a number of occasions
for considering our proposal. Since making our proposal, despite our
repeated requests to begin discussions, you have refused to talk or meet
with us.
Today, I received your letter and a copy of your Schedule 14D-9 filing
in which you publicly recommended that your stockholders not tender their
shares. The stated reasons for your Board's rejection of our proposal are
unpersuasive and, we believe, misleading in many respects. Of equal
importance, the issues you raise are precisely the issues you should have
been discussing with us during the last two weeks.
Your first objection relates to our proposed use of a voting
trust -- notwithstanding your own previous demands that we propose a voting
trust. You point out the obvious fact that we have not yet obtained
Interstate Commerce Commission approval to use the trust. Yet, you fail to
mention that the use of a trust in a situation such as ours has never been
denied by the ICC. We believe that ICC approval of our trust will be
forthcoming shortly.
You ask us to improve the financial terms of our proposal, yet you
fail to mention that our proposal represents a premium to the consideration
in your proposed Burlington Northern merger, which has been endorsed by
your financial advisors as fair to your shareholders. We were surprised by
the failure in your Schedule 14D-9 to advise Santa Fe shareholders of the
views of your financial advisors as to the fairness of our offer. We
believe it is highly unusual for a board of directors to make a
recommendation without obtaining such advice. If your Board did obtain such
advice, it should have been disclosed to your shareholders.
You claim that our proposal is too conditional, yet you fail to
mention that we advised you in writing on November 13 that we were prepared
to negotiate all contractual terms of our proposal, including the
conditions to our tender offer. We believe the condition of ICC approval of
your merger with Burlington Northern creates considerable uncertainty for
that transaction. Our proposal would eliminate that risk for your
shareholders.
You note that our transaction is a taxable one, yet you fail to
mention our continued willingness to discuss with Santa Fe our tax-free,
stock-for-stock proposal.
Finally, you ask for "clarification" of these issues. Can there be any
effective way of obtaining clarification other than for you to meet with
us? You say your recommendation is "subject to change as events unfold"
that "clarify" our proposal, yet you have resisted obtaining such
clarification.
The process you have established of engaging in discussions and
sharing information with Burlington Northern while refusing to talk or meet
with us prevents us from competing on an equal basis. This process cannot
possibly allow you and your Board of Directors to fulfill your fiduciary
duty and maximize value for your shareholders.
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<PAGE> 15
We again call on you to establish a fair process and meet with us.
Sincerely,
/s/ Dick Davidson
cc: Board of Directors
Santa Fe Pacific Corporation
On November 23, 1994, Parent announced that it expected to extend the Offer
beyond the December 8, 1994 deadline because of the Company's unwillingness to
negotiate a merger agreement.
On November 25 and November 27, 1994, representatives of the Company's
financial advisor and representatives of Parent's financial advisor discussed
whether Parent would be willing to increase the price of its proposal.
On November 28, 1994, Parent announced that it had received an informal,
non-binding opinion from the staff of the ICC authorizing the use of the voting
trust in its proposed transaction with the Company. Also on November 28, 1994,
Parent announced that Mr. Davidson sent the following letter to Mr. Krebs:
November 28, 1994
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, IL 60173
Dear Rob:
In several recent communications, you have insisted that Union Pacific
improve its proposal as a pre-condition to your having any discussions or
sharing any information with us. We believe this position only creates an
additional impediment to your establishing a fair process for the sale of
Santa Fe.
Over the last two months, we have unilaterally made three attractive
proposals to negotiate an acquisition of Santa Fe. During this period, you
have consistently refused to talk or to meet with us and have been
unwilling to provide us with any of the confidential information that you
furnished to Burlington Northern.
As you know, the Interstate Commerce Commission today approved the use
of a voting trust in our proposed acquisition. We believe our current
proposal is superior to that of Burlington Northern in terms of price, form
of consideration, timing and certainty. The next step should be yours. It
is time to begin discussions and to share information.
Sincerely,
/s/ Dick Davidson
cc: Board of Directors
Santa Fe Pacific Corporation
On November 29, 1994, the Company announced that it had postponed from
December 2, 1994 to December 16, 1994 the Special Meeting of stockholders to
vote on the Original BNI/SFP Agreement. The Company also announced that it would
meet with Parent in an effort to clarify and improve Parent's Offer and that the
Company's Board had adopted the Rights Agreement. In addition, the Company
stated that the Board had postponed the distribution date of the Rights from
December 1, 1994 to December 16, 1994. Later on November 29, 1994, Parent's
financial advisor telephoned the Company's financial advisor to discuss a
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<PAGE> 16
possible negotiation process between the parties and Parent's access to certain
confidential information regarding the Company.
According to the Joint Offer to Purchase, on December 2, 1994, the Company
asked BNI to consider revising the Original SFP/BNI Agreement to provide for a
higher exchange ratio combined with tender offers by BNI and the Company for
Shares and open market repurchases by the Company of Shares after the tender
offer and prior to consummation of the merger, in each case contingent on
stockholder approval of the merger. The Company advised BNI that, based on
discussions with some of the Company's large stockholders, such a revision might
draw the support of those stockholders. BNI made no substantive response to this
request.
On December 3, 1994, representatives of Parent and Parent's legal and
financial advisors met with the Company's legal advisors to review and discuss
certain financial and other information regarding the Company. After appropriate
provisions had been agreed to limiting Parent's access to certain commercially
sensitive information, Parent's legal and financial advisors were allowed to
review certain additional information.
On December 4, 1994, representatives of Parent met with representatives of
the Company at the Company's offices in Schaumburg, Illinois. At this meeting,
the parties discussed certain financial and other information regarding the
Company.
During early December, legal advisors of Parent and legal advisors of the
Company conducted discussions with respect to a proposed merger agreement.
During these discussions, the legal advisors discussed, among other things, the
conditions to the original Offer and a proposed merger agreement. In order to
address the Company's concerns set forth in their Schedule 14D-9 (as set forth
above and below), Parent's legal advisors sent proposed revised conditions to
the Company's legal advisors. Parent and the Purchaser believe that substantial
progress was made in these discussions in negotiating a mutually satisfactory
merger agreement, although no final agreement was reached.
On December 7, 1994, Parent announced that it had extended the Expiration
Date of the Offer to 12:00 Midnight, New York City time, on Friday, December 23,
1994.
According to the Joint Offer to Purchase, on December 13, 1994,
representatives of BNI informed representatives of the Company that BNI might be
willing, subject to approval of BNI's Board of Directors, to combine an increase
in the exchange ratio for the merger with a tender offer by both BNI and the
Company for Shares and possible repurchases by the Company of Shares in the open
market after the tender offer and prior to consummation of the merger, in each
case contingent on stockholder approval of the merger. Representatives of BNI
and representatives of the Company then discussed the possible terms such a
transaction might include.
According to the Joint Offer to Purchase, on or about December 14, 1994,
the Company postponed its Special Meeting of Shareholders to vote on the
Original SFP/BNI Agreement to January 27, 1995, and changed the record date for
that meeting to December 27, 1994. Also on December 14, representatives of BNI
and representatives of the Company continued the discussions they had conducted
the previous day.
On December 14, 1994, despite Parent's receipt of an informal, non-binding,
staff opinion from the ICC authorizing the use of the Voting Trust, the
Company's Board of Directors continued to recommend that stockholders not tender
their Shares to Parent. According to Amendment No. 3 to the Schedule 14D-9, the
Company disclosed that the Board based its recommendation on the fact that:
the Union Pacific Offer is subject to a number of conditions that are of
concern to the Company. These conditions provide Union Pacific with the
broad discretionary ability to terminate its Offer upon the occurrence
of certain events, many of which are not necessarily in the direct
control of the Company. Such conditions include, but are not limited to,
the occurrence of: a threat or commencement of any action or proceeding
by any person challenging the transactions contemplated by the Offer or
any subsequent merger; any material adverse change in prices generally
of shares on the New York Stock Exchange; armed hostilities directly or
indirectly involving the United States;
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and any tender or exchange offer or any public proposal of a tender or
exchange offer for any common stock of the Company by any other person.
In the Schedule 14D-9, the Company further based its recommendation on the
fact that:
the merger agreement that Union Pacific is asking the Company to execute
as a condition to consummating the Offer would require that the Company
make a number of representations and warranties and that the accuracy of
those representations and warranties be a condition to consummation of
the merger. This requirement is problematic for the Company because it
creates a risk that Union Pacific could consummate the Offer but fail to
consummate the merger, leaving Santa Fe's present stockholders as
minority stockholders.
On December 14, 1994, Drew Lewis, Chairman and Chief Executive Officer of
Parent, sent the following letter to Mr. Krebs:
December 14, 1994
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, IL 60173
Dear Rob:
I am writing to advise you, as requested by your advisors, of our
position concerning our merger proposal.
Our response at this stage is a function of Santa Fe's having pursued
a flawed sale process. Your advisors have repeatedly demanded that we
improve our proposal while refusing to establish any procedures for
considering competing proposals on a fair and equal basis. In fact, your
advisors have frequently told us you will not negotiate with Union Pacific
unless we agree to pay at least $20 per Santa Fe share. This position is
clearly inconsistent with your negotiating and recommending several
transactions with Burlington Northern at prices well below $20.
We believe our current proposal is an extremely attractive one and in
the best interests of Santa Fe and its shareholders and customers. Despite
this, you have continued to pursue a process that favors any result other
than a transaction with Union Pacific. We are prepared to continue
discussions with you, but we urge you to establish a fair and open sale
process.
Sincerely,
/s/ Drew
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On December 15, 1994, Parent's legal advisor sent the following letter to
the Company's legal advisor:
December 15, 1994
Scott J. Davis, Esq.
Mayer, Brown & Platt
190 South LaSalle Street
Chicago, Illinois 60606
Dear Scott:
On behalf of Union Pacific, I am writing to raise a number of concerns
with the process that Santa Fe has established for considering competing
proposals to acquire Santa Fe. These issues were described yesterday in
detail by CS First Boston to Goldman Sachs and also were referred to in a
letter from Drew Lewis to Robert Krebs.
As CS First Boston advised Goldman Sachs yesterday, Santa Fe has not
necessarily received Union Pacific's best proposal. Union Pacific has been
and is willing to consider and discuss revisions to its proposal. However,
Union Pacific's response at this stage is a function of Santa Fe's having
pursued what we believe is a flawed sale process. Santa Fe has failed to
treat bidders on a fair and equal basis and appears to be pursuing a
process that favors any outcome other than a transaction with Union
Pacific.
Specifically, among other things, Santa Fe's financial advisors have
repeatedly stated that Santa Fe will not negotiate a transaction with Union
Pacific unless Union Pacific confirms that it is prepared to provide value
of at least $20 per Santa Fe share. This position is inconsistent with
Santa Fe's negotiating and recommending several transactions with
Burlington Northern, all of which have been at prices well below $20. We
are concerned that your insistence on such a high price as a condition to a
transaction with Union Pacific serves to discourage any transaction with
Union Pacific while you pursue a variety of alternative transactions with
Burlington Northern at a lower value level. If you also have told
Burlington Northern and any other interested parties that you will not
negotiate a transaction unless it provides value of at least $20 per share,
you should disclose to us and the public that you have established a $20
bidding floor for all potential purchasers.
We are further concerned that Santa Fe has limited itself to
"clarifying" Union Pacific's proposal, while apparently engaging in
extensive substantive negotiations with Burlington Northern. Santa Fe's
process appears designed to use Union Pacific as a stalking horse, and use
what we discuss with you in your negotiations with Burlington Northern.
There have been reports about Santa Fe's consideration of alternative
structures for a transaction. We are prepared to consider alternative
structures and request that you promptly advise us of any alternatives
which your client may prefer.
Please advise Santa Fe that Union Pacific is eager to participate in a
fair process, and is willing to consider and negotiate revisions to its
proposal. Union Pacific asks only that it be treated on an equal basis with
Burlington Northern.
You will be receiving today by separate cover a revised form of merger
agreement. Union Pacific's draft merger agreement contains fewer
conditions, and provides greater certainty, than your agreement with
Burlington Northern. Notwithstanding this, Union Pacific is prepared to
discuss any and all remaining concerns you may have.
We note that our agreement does not contain any "lock-up" provision,
despite Union Pacific's having unilaterally offered Santa Fe a right to
terminate any agreement with Union Pacific in order to accept a superior
proposal -- a right which does not exist in your current agreement with
Burlington Northern. We expect that your concerns about providing Union
Pacific with any lock-up or expense reimbursement apply equally to
Burlington Northern and that you will not provide Burlington Northern any
stock or
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<PAGE> 19
asset rights, a "bust up" fee or other arrangement that would in any manner
impede Union Pacific's efforts to pursue a transaction with Santa Fe.
I would appreciate your discussing these matters with your client and
responding to us at your earliest convenience.
Sincerely,
/s/ Paul T. Schnell
Skadden, Arps, Slate, Meagher &
Flom
cc: Carl W. von Bernuth, Esq.
Also on December 15, 1994, Mr. Krebs sent the following letter in
response to Mr. Lewis' letter:
December 15, 1994
Mr. Drew Lewis, Chairman
Union Pacific Corporation
Martin Tower
Eighth and Eaton Avenues
Bethlehem, Pennsylvania 18018
Dear Drew:
This is in response to your letter dated December 14, 1994 concerning
the process that Santa Fe is currently pursuing. Your letter assumes that
Santa Fe is conducting an auction. In fact, however, the board of Santa Fe
has never put the company up for sale. Instead, subject to shareholder
approval, the board agreed to a strategic combination with the Burlington
Northern, which is designed to achieve significant long-term growth for
Santa Fe's shareholders far beyond the current value of the Burlington
Northern stock that is to be exchanged in the merger. After that agreement
was announced, Union Pacific made an unsolicited merger proposal to Santa
Fe.
As you know, under our contract with Burlington Northern, Santa Fe
could not provide confidential information to or negotiate with any other
potential merger partner unless the board was advised by counsel that it
had a fiduciary duty to do so. After Union Pacific improved its offer and
obtained the ICC staff's approval of its proposed voting trust, we were
advised by our counsel that we did have a fiduciary duty to provide
information and to negotiate with Union Pacific. In the past two weeks, we
have made available to Union Pacific all of the information that was given
to Burlington Northern, and more. In fact, at a meeting in our office on
December 4, 1994, your executive vice president-finance, L. White Matthews
III, told a group of our senior officers that the amount of information
Union Pacific had received from Santa Fe was more than they "dreamed" of
obtaining. In addition, we have negotiated in good faith the terms of Union
Pacific's proposed merger agreement and tender offer.
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<PAGE> 20
Throughout our discussions over the past two weeks we have continually
emphasized the need for Union Pacific to improve its offer as soon as
possible. We have also been negotiating with Burlington Northern with a
view toward improving the existing merger agreement. In all of these
discussions, our goal has been to achieve the best result for our
shareholders, taking into account both short-term and long-term objectives.
I believe that we have done everything we can to enable Union Pacific
to improve its offer, and, as our financial advisors have been telling your
financial advisors for many days, we hope you will do so promptly. The
process we have followed is designed to promote the best interests of our
shareholders.
Sincerely,
/s/ Rob
According to the Joint Offer to Purchase, on December 15, 1994, the
Company's Board met and heard a presentation from the Company's management and
financial and legal advisors regarding BNI's proposal. The Company's Board
authorized its representatives to negotiate with BNI representatives to attempt
to reach a definitive agreement.
On December 15, 1994, Parent issued a press release confirming that it
continued to hold discussions with the Company in response to the Company's
request that Parent clarify its acquisition proposal. Parent also requested that
the Company clarify its process for considering competing proposals.
Also on December 15, 1994, the Company announced that the Company's Board
had postponed the distribution date of the Rights from December 16, 1994 to
January 31, 1995.
On December 16, 1994, Parent announced that it would consider revising its
proposal if the Company established a fair process. Also on December 16, 1994,
Mr. Lewis sent the following letter to Mr. Krebs:
December 16, 1994
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, IL 60173
Dear Rob:
I have read your December 15 letter, and can only conclude that you
have not been kept fully apprised of the actions of your management and
advisors.
Your characterization of Santa Fe's process for considering bids, or
lack of such a process, is inaccurate and distorted. Most importantly, you
have not, as you assert, done everything you can to enable Union Pacific to
revise its proposal. On the contrary, Santa Fe has pursued a process that
favors any outcome other than a transaction with Union Pacific.
We are extremely disappointed with the flawed and biased sale process
being pursued by Santa Fe. Our financial advisor, CS First Boston,
expressed our concerns to your financial advisor, Goldman Sachs, on
December 14. On December 15, before you sent me your letter, our counsel
expressed these concerns in a letter to your counsel, a copy of which is
enclosed.
And now, in light of your letter, I will tell you directly of our
concerns.
Here are the facts:
1. Your advisors have said you will not even consider a proposal from
us at less than $20 per share, although you negotiated and recommended
several transactions with Burlington Northern at prices well below $20 per
share. Your insistence on such a high minimum price as a condition to a
transaction with
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Union Pacific discourages any transaction with Union Pacific while you
pursue a variety of alternative transactions with Burlington Northern at a
lower value level.
2. Santa Fe has refused to establish any procedures that would permit
us to compete on an equal basis with Burlington Northern. While you
obviously have continued to engage in serious, substantive negotiations
with Burlington Northern, you have simply sought "clarifications" from us
while repeatedly asking us to "improve" what for many weeks has been the
most attractive proposal on the table. You are using Union Pacific as a
stalking horse for an improved Burlington Northern bid. Based on your
agreement with Burlington Northern, we must assume that Santa Fe is using
information obtained in its discussions with Union Pacific to assist
Burlington Northern in its efforts to improve its bid.
3. Santa Fe has discussed alternative acquisition structures with
Burlington Northern, but, despite our stated willingness to consider
alternative structures and revisions to our current proposal, you have not
given us any indication of what alternative structures would be acceptable
to Santa Fe.
4. Santa Fe, in its recent Schedule 14D-9 filing, stated that our
proposal "is subject to a number of conditions that are of concern to
[Santa Fe]." But, the fact is, Union Pacific's proposal contains fewer
conditions, and provides greater certainty for your shareholders, than the
transaction you willingly agreed to with Burlington Northern.
5. Santa Fe's Board of Directors unilaterally adopted a "poison pill"
rights plan that specifically exempts Burlington Northern but is applicable
to our proposal.
6. Santa Fe has stood silently by while Burlington Northern, your
preferred suitor, has tried unsuccessfully to block ICC approval of our
voting trust. This is the voting trust that you specifically asked us to
establish more than two months ago and that provides speed and certainty
for your shareholders.
7. Santa Fe apparently never asked its financial advisor to express
its opinion as to the fairness of our proposal, but, as you know, Santa Fe
previously requested and received a fairness opinion on the Burlington
Northern merger which, at the time, based on the then current market price,
valued Santa Fe shares at approximately $13.50.
This listing is by no means exhaustive but is illustrative of the
flawed and biased sale process undertaken by Santa Fe. In light of this,
the assertion that Santa Fe's goal has been to achieve the best results for
its shareholders rings hollow.
Let me be very clear. By your actions you have put Santa Fe up for
sale and Union Pacific is a very interested buyer. We want to acquire Santa
Fe by competing on an equal basis with Burlington Northern and any other
potential bidders. If Santa Fe establishes a fair and open process, we
would be eager to participate, and would be willing to consider and discuss
revisions to our proposal.
Santa Fe has stated that it is considering alternative structures. If
you and your Board truly desire a fair process, it is incumbent upon you to
inform us promptly of each alternative under consideration, to state the
minimum bidding level (if any) applicable to all interested parties, and to
give us the opportunity to consider and respond to each alternative. In
addition, you should instruct your management and advisors to establish
immediately a fair and unbiased sale process. If you would like our
specific suggestions concerning establishing a fair process, our advisors
would be pleased to provide them.
Santa Fe has not necessarily received Union Pacific's best proposal. I
await your response.
Sincerely,
/s/ Drew
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Later on December 16, 1994, Parent's legal advisor sent the following
letter to the Company's legal advisor:
December 16, 1994
Scott J. Davis, Esq.
Mayer, Brown & Platt
190 South LaSalle Street
Chicago, Illinois 60606
Dear Scott:
We have not received any response to Drew Lewis' letter to Robert
Krebs sent earlier today or to my letter to you dated December 15.
I am writing on behalf of Union Pacific Corporation to suggest that
the legal and financial advisors of each party meet briefly to discuss
whether we can structure a process for going forward that is acceptable to
both our clients.
Based on Union Pacific's willingness to consider and discuss revisions
to its proposal, it would be in both parties' interest to continue to
progress with the discussions. We hope that a meeting of advisors would
enable our clients to do that.
Please call me at any time this evening or over the weekend to discuss
this matter.
Sincerely,
/s/ Paul T. Schnell
Skadden, Arps, Slate, Meagher &
Flom
cc: Carl W. von Bernuth, Esq.
Also on December 16, 1994, Parent extended the Expiration Date of the Offer
to 12:00 Midnight, New York City time, on Thursday, January 19, 1995.
According to the Joint Offer to Purchase, beginning on December 16, 1994,
representatives of the Company and BNI met to discuss whether a definitive
agreement could be reached. In addition, representatives of the Company had
discussions with some of the Company's large stockholders to determine whether
or under what circumstances they would make written commitments to support the
revised merger.
On December 17, 1994, as requested by Parent, Parent's financial and legal
advisors conducted a telephonic meeting with the Company's financial and legal
advisors. During this meeting, among other things, Parent's advisors, on behalf
of Parent, expressed to the Company's advisors the interest of Parent in making
an improved proposal to acquire the Company provided that Parent be given an
opportunity to bid for the Company on a fair and equal basis with BNI. Parent's
advisors expressed the concern that the Company had failed to establish a fair
and unbiased sale process. In particular, Parent's advisors objected to the fact
that the Company would continually advise BNI of substantive communications
occurring between the Company and Parent, including with respect to any revised
acquisition proposal that Parent might make. The Company's advisors asserted,
among other things, that the Company was not conducting an auction, time was of
the essence and if Parent wanted to improve its bid, it should do so soon.
Also on December 17, 1994, according to the Joint Offer to Purchase, the
negotiations between the Company's and BNI representatives continued with no
agreement being reached.
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<PAGE> 23
On December 17, 1994, Mr. Krebs sent Mr. Lewis the following letter:
Mr. Drew Lewis, Chairman
Union Pacific Corporation
Martin Tower
8th and Eaton Avenues
Bethlehem, PA 18018
Dear Drew:
I am not sure that continuing to trade letters on "process" issues
serves any useful function. However, let me briefly reiterate Santa Fe's
position. Contrary to the statement in your December 16 letter, the Santa
Fe board has NOT put the company up for sale, and it is not conducting an
auction. We entered into a contract for a strategic combination with
Burlington Northern -- a combination that promises significant long-term
growth. We are now negotiating with Burlington Northern in order to improve
that agreement.
At the same time, however, we have provided Union Pacific with all of
the information about Santa Fe it needs in order to make its best
alternative proposal. If you are willing and able to improve your proposal,
I suggest that you do so without delay.
Sincerely,
/s/ Rob
According to the Joint Offer to Purchase, on December 18, 1994, the Company
and BNI representatives reached an agreement on the terms of the revised BNI/SFP
Agreement.
According to the Joint Offer to Purchase, on December 18, 1994, the
Company's Board approved the revised BNI/SFP Agreement. Shortly after the
Company's Board meeting, BNI and the Company entered into the revised BNI/SFP
Agreement.
On December 18, 1994, Mr. Lewis sent the following letter to Mr. Krebs:
December 18, 1994
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, IL 60173
Dear Rob:
I understand that you sent a letter to my office Saturday.
We continue to be troubled by Santa Fe's refusal to address in any way
our concerns about your process for considering acquisition proposals.
As we have repeatedly stated, and said to your advisors yesterday, we
want to be in a position to make an improved proposal. We see no reason why
you cannot address our concerns, and hope you will give consideration to
the specific suggestions made by our advisors.
Sincerely,
/s/ Drew Lewis
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<PAGE> 24
On December 18, 1994, the Company announced that BNI and the Company would
make a joint tender offer to acquire 63,000,000 Shares, or approximately 33% of
all such Shares outstanding, at $20.00 per Share in a recapitalization and
merger transaction.
On December 20, 1994, Parent announced that it was reviewing its options
concerning its proposal to acquire the Company. Also on December 20, 1994, Mr.
Lewis sent the following letter to Mr. Krebs:
December 20, 1994
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumberg, IL 60173
Dear Rob:
The recent actions of Santa Fe are but a continuation of Santa Fe's
ongoing efforts to pursue its sale to Burlington Northern, and to prevent a
transaction with Union Pacific, at all costs.
We object to Santa Fe's grant of "lock-ups" to Burlington Northern to
deter competing bids, and to Santa Fe's repeated refusal to address our
objections to its flawed sales process.
With regard to Santa Fe's efforts to deter competing bids, we note
with interest that a Burlington Northern representative, who would speak
only on the condition of anonymity, was quoted today in the press as
stating: "This is a carefully crafted plan designed to accomplish the
merger and to make it prohibitively expensive for UP to top."
As we have announced, we will be reviewing our options concerning our
acquisition proposal.
Sincerely,
/s/ Drew
Also on December 20, 1994, the ICC issued an order of the full commission
approving the Voting Trust.
On December 23, 1994, the Company and BNI commenced the Joint Offer for up
to 63,000,000 Shares (together with the associated Rights) at $20.00 per Share,
net to the tendering stockholder in cash, with the Company severally obligated
to purchase up to 38,000,000 Shares and BNI severally obligated to purchase up
to 25,000,000 Shares pursuant to the Joint Offer upon the terms and subject to
the conditions set forth in the Joint Offer to Purchase.
According to the Joint Offer to Purchase, of the Shares tendered and
accepted for payment in the Joint Offer, the Company is severally obligated to
purchase 60.3% of such Shares and BNI is severally obligated to purchase 39.7%
of such Shares, subject to the terms and conditions of the Joint Offer.
According to the Joint Offer to Purchase and the BNI/SFP Agreement, the Company
plans to merge into BNI whereby the separate existence of the Company will cease
with BNI continuing as the surviving corporation, and each outstanding Share
will be converted into a right to receive 0.40 of a share of BNI Common Stock.
As of January 17, 1995, the last full trading day prior to Parent's announcement
that it was amending the Offer upon the terms set forth in this Supplement, 0.40
of a share of BNI Common Stock had a value of $21.05, based on the closing sales
price of BNI Common Stock as reported on the NYSE.
The Original BNI/SFP Agreement was amended to provide that, among other
things, the Company is obligated in certain circumstances, to pay certain fees
to BNI upon termination of the BNI/SFP Agreement. According to the Joint Offer
to Purchase, the BNI/SFP Agreement specifically provides that:
SFP has agreed that if the [BNI/SFP] Agreement shall be terminated due to
(a) the acquisition of any Person, entity or "group" other than BNI of more
than 50% or more of the outstanding [Shares], (b) the
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<PAGE> 25
approvals of the stockholders of SFP and BNI having not been obtained, (c)
the Board of Directors of SFP, prior to the meeting of stockholders of SFP,
having withdrawn, modified or changed in a manner adverse to BNI, its
approval or recommendation of the [BNI/SFP] Agreement or the [m]erger, (d)
the board of directors of SFP having withdrawn or modified in a manner
adverse to BNI its approval or recommendation of the [Joint] Offer, the
[BNI/SFP] Agreement or the [m]erger in order to permit SFP to execute a
definitive agreement in connection with a Takeover Proposal (as defined in
the BNI/SFP Agreement) or in order to approve another tender offer for
[Shares] or the board of directors of SFP shall have recommended any other
Takeover Proposal, or (e) if the Offer is terminated and SFP and BNI shall
not have purchased [Shares] pursuant to the [Joint] Offer, then it will pay
BNI an amount equal to $50,000,000 plus all out-of-pocket expenses, not to
exceed $10,000,000 incurred by BNI in connection with the [BNI/SFP]
Agreement, the [Joint] Offer and all related transactions . . . provided,
that no such payment will be required if the [BNI/SFP] Agreement is
terminated pursuant to clause (b), (c) or (e) above unless, after December
18, 1994, a new Takeover Proposal involving SFP has been announced or made
(it being understood that any modification of [the Purchaser's Offer] in
existence on December 18, 1994 shall be deemed a new Takeover Proposal).
SFP has also agreed that if the [BNI/SFP] Agreement shall be terminated
pursuant to clause (b),(c) or (e) above and no payment is required by it in
the manner contemplated above, it will reimburse BNI for all out-of-pocket
expenses incurred by BNI in connection with the [BNI/SFP] Agreement, the
[m]erger, the [Joint] Offer and all related transactions.
According to the terms of the BNI/SFP Agreement, the amended Offer is an
event which, in certain circumstances, would obligate the Company to pay a
termination fee to BNI in the amount of $50,000,000 plus an additional amount
for expenses incurred by BNI up to a maximum of $10,000,000.
Also on December 23, 1994, according to Amendment No. 6 to the Schedule
14D-9, the Company's Board of Directors continued to recommend that stockholders
not tender their Shares to Parent.
On January 15, 1995, the Parent's Board of Directors met to consider the
various alternatives available to Parent in connection with its proposal to
acquire the Company.
On January 17, 1995, the Board of Directors of Parent held a meeting and
authorized the amended Offer.
Also on January 17, 1995, Mr. Lewis sent the following letter to Mr. Krebs:
January 17, 1995
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, IL 60173
Dear Rob:
I am writing to inform you that Union Pacific has revised its
acquisition proposal to increase the price to $18.50 per share in cash and
to seek to acquire 100% of Santa Fe's outstanding shares in the tender
offer.
By using our Interstate Commerce Commission approved voting trust,
your shareholders would receive immediate payment of the entire purchase
price in our transaction, without bearing any risk relating to ICC approval
of our combination with Santa Fe. By contrast, the new, leveraged
Burlington Northern transaction would require a delay of up to several
years for payment of two-thirds of the purchase price to Santa Fe
shareholders, and would require your shareholders to bear the risk of ICC
approval.
In addition to the all-cash advantage of our offer, we believe our
transaction is superior to the Burlington Northern acquisition when one
discounts BN's purchase price for the time delay in payment,
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<PAGE> 26
the ICC risk of non-consummation of the BN transaction and the uncertain
value of BN stock to be received.
Our preference remains to negotiate a merger agreement with Santa Fe.
As your own advisors stated, we were very close to completing negotiation
of a merger agreement before you announced your new transaction with
Burlington Northern. We should be able to conclude our negotiations very
quickly in light of our revised offer. We continue to believe it is a
violation of your Board's fiduciary duties for Santa Fe to resist
negotiating a transaction with Union Pacific.
If you refuse to negotiate with us, we would be prepared to purchase
shares in our tender offer without a merger agreement, provided that your
shareholders tender at least 90% of Santa Fe's outstanding shares and other
impediments such as the rights plan are eliminated. In order to complete
the acquisition on a unilateral basis, we would first ask the ICC to
approve an amendment to our voting trust agreement that would enable the
trustee to cause Santa Fe, following the acquisition of Santa Fe shares, to
agree to cooperate with us in obtaining ICC approval of a Santa Fe/Union
Pacific combination. We would seek ICC approval of the amended voting trust
agreement once Santa Fe shareholders vote to disapprove the Burlington
Northern merger.
Our offer, including the conditions to our transaction, remains
unchanged in all other material respects. Given your rejection of our
alternative $20 all-stock proposal made several months ago, we confirm our
withdrawal of such alternative proposal.
Sincerely,
/s/ Drew
cc: Board of Directors
Santa Fe Pacific Corporation
On January 17, 1995, Parent announced the amended terms of the Offer
described in the above letter.
On January 18, 1995, the Purchaser commenced the amended Offer.
10. PURPOSE OF THE OFFER AND THE PROPOSED MERGER. The discussion set forth
in Section 11 of the Offer to Purchase is hereby amended and supplemented by the
following:
General. The purpose of the Offer is to acquire all of the outstanding
Shares of the Company. The purpose of the Proposed Merger is to acquire all
Shares not beneficially owned by the Purchaser following consummation of the
Offer.
The Purchaser will seek to affect the Proposed Merger with the Company as
promptly as practicable following consummation of the Offer. Under the Proposed
Merger Agreement and in the case of a Short-Form Merger effected with or without
an agreement, at the effective time of the Proposed Merger, each Share that is
outstanding prior to the effective time (other than Shares held in the treasury
of the Company or owned by Parent, the Purchaser or any direct or indirect
wholly-owned subsidiary of Parent and Dissenting Shares) would be converted into
the right to receive $18.50 in cash.
As discussed in Section 9 of this Supplement, Parent and the Purchaser have
discussed with the Company a Proposed Merger Agreement. Parent and the Purchaser
believe that substantial progress was made in these discussions. However, a form
of merger agreement has not been agreed to by the parties. Parent and the
Purchaser believe that a cash tender offer for all of the outstanding Shares
would address the Company's concern described in Amendment No. 3 to Schedule
14D-9 that "Union Pacific could consummate the Offer but fail to consummate the
merger leaving Santa Fe's present stockholders as minority stockholders."
Although Parent desires to continue such discussions, there can be no assurance
that such discussions will occur or, if such discussions occur, as to the
outcome thereof. In the event Parent is unable to negotiate the Proposed Merger
Agreement with the Company, the Purchaser will terminate the Offer unless the
Company decides to waive the Merger Agreement Condition as discussed above. See
Introduction; The
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<PAGE> 27
Merger Agreement Condition of this Supplement. The Purchaser is currently
reviewing its options with respect to the Offer and may consider, among other
things, changes to the material terms of the Offer. The Purchaser reserves the
right to amend the Offer (including amending the Offer Price) if it enters into
the Proposed Merger Agreement or to negotiate a merger agreement with the
Company not involving a tender offer pursuant to which the Purchaser would
terminate the Offer and the Shares would, upon consummation of such merger, be
converted into the right to receive cash, Parent Common Stock and/or other
securities in such amounts as are negotiated by Parent and the Company.
Other. Under the DGCL, if the Purchaser acquires less than 90% of the
outstanding Shares, the Proposed Merger would require, among other things, the
affirmative vote of the holders of at least a majority of all the outstanding
Shares entitled to vote at a meeting of stockholders. See Introduction; The
Merger Agreement Condition of this Supplement. If the Purchaser acquires Shares
pursuant to the Offer, the Purchaser may be in a position to exercise voting
control of more than a majority of the Shares and will have the voting power to
approve the Proposed Merger without the vote of any other stockholder. If the
Purchaser acquires 90% or more of the outstanding Shares pursuant to the Offer,
Parent would have the power to consummate a merger of the Purchaser with and
into the Company without a meeting or vote of stockholders pursuant to the DGCL.
Holders of Shares will not have appraisal rights as a result of the Offer.
If the Proposed Merger is consummated, however, persons who hold Shares at that
time would have the right to appraisal of their Shares in accordance with
Section 282 of the DGCL. Such appraisal rights, if the statutory procedures are
complied with, would result in a judicial determination of the "fair value" of
the Shares owned by such holders. Any such judicial determination of the fair
value of the Shares could be based upon considerations other than or in addition
to the price paid in the Offer and the Proposed Merger and the market value of
the Shares, including asset values, the investment value of the Shares and any
other valuation considerations generally accepted in the investment community.
The value so determined for Shares could be more or less than the value of the
consideration per Share to be paid pursuant to the Offer or the Proposed Merger
and payment of such consideration would take place subsequent to payment
pursuant to the Offer.
In addition, several decisions by the Delaware courts have held that a
controlling stockholder of a corporation involved in a merger has a fiduciary
duty to the other stockholders which requires that the merger be fair to such
other stockholders. In determining whether a merger is fair to minority
stockholders, the Delaware courts have considered, among other things, the type
and amount of consideration to be received by the stockholders and whether there
was fair dealing among the parties. The Delaware Supreme Court indicated in
Weinberger v. UOP, Inc. and Rabkin v. Philip A. Hunt Chemical Corp. that
ordinarily the remedy available to stockholders in a merger that is found not to
be "fair" to minority stockholders is the right to appraisal described above or
a damages remedy based on essentially the same principles.
If the Purchaser purchases Shares pursuant to the Offer, and the Proposed
Merger or another merger or other business combination is consummated more than
one year after the completion of the Offer, or if such a merger or other
business combination were to provide for the payment of consideration less than
that paid pursuant to the Offer, compliance by the Purchaser with Rule 13e-3
under the Exchange Act would be required, unless the Shares were to be
deregistered under the Exchange Act prior to such transaction. See Section 13 of
the Offer to Purchase. Rule 13e-3 would require, among other things, that
certain financial information concerning the Company and certain information
relating to the fairness of the proposed transaction and the consideration
offered to minority stockholders therein be filed with the Commission and
disclosed to minority stockholders prior to consummation of the transaction.
THIS SUPPLEMENT DOES NOT CONSTITUTE A SOLICITATION OF PROXIES FOR ANY
MEETING OF THE COMPANY'S STOCKHOLDERS. PARENT IS CURRENTLY SOLICITING PROXIES IN
OPPOSITION TO THE BNI/SFP AGREEMENT. SUCH SOLICITATION BY PARENT IS BEING MADE
ONLY PURSUANT TO SEPARATE PROXY MATERIALS COMPLYING WITH THE REQUIREMENTS OF
SECTION 14(A) OF THE EXCHANGE ACT. IN ADDITION, THIS SUPPLEMENT IS NEITHER AN
OFFER TO SELL NOR A SOLICITATION OF OFFERS TO BUY ANY SECURITIES WHICH MAY BE
ISSUED IN ANY MERGER OR SIMILAR BUSINESS COMBINATION INVOLVING THE PURCHASER,
PARENT OR THE COMPANY.
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<PAGE> 28
11. AMENDED CONDITIONS OF THE OFFER. The conditions to the Offer as set
forth in Section 14 of the Offer to Purchase are hereby amended and restated as
follows:
Notwithstanding any other provisions of the Offer, and in addition to (and
not in limitation of) the Purchaser's rights to extend and amend the Offer at
any time in its sole discretion, the Purchaser shall not be required to accept
for payment or, subject to any applicable rules and regulations of the
Commission, including Rule 14e-1(c) under the Exchange Act (relating to the
Purchaser's obligation to pay for or return tendered Shares promptly after
termination or withdrawal of the Offer), pay for, and may delay the acceptance
for payment of or, subject to the restriction referred to above, the payment
for, any tendered Shares, and may terminate the Offer, if, in the sole judgment
of the Purchaser (i) at or prior to the Expiration Date any one or more of the
Minimum Condition, the Merger Agreement Condition, the Stockholder Vote
Condition, the Rights Condition or the Voting Trust Condition has not been
satisfied, (ii) the Purchaser is not satisfied that Section 203 of the DGCL has
been complied with or is invalid or otherwise inapplicable to the Offer and the
Proposed Merger, (iii) the Purchaser is not satisfied that the BNI/SFP Agreement
has been terminated in accordance with its terms or (iv) at any time on or after
January 17, 1995 and before the time of payment for any such Shares (whether or
not any Shares have theretofore been accepted for payment pursuant to the Offer)
any of the following events shall occur or shall be determined by the Purchaser
to have occurred:
(a) there shall be threatened, instituted or pending any action or
proceeding by any government or governmental authority or agency, domestic
or foreign, or by any other person, domestic or foreign, before any court
or governmental authority or agency, domestic or foreign, (i)(A)
challenging or seeking to make illegal, to delay or otherwise directly or
indirectly to restrain or prohibit the making of the Offer, the acceptance
for payment of or payment for some of or all the Shares by the Purchaser or
Parent or any other affiliates of Parent or the consummation by the
Purchaser or Parent or any other affiliates of Parent of the Proposed
Merger or other business combination with the Company, (B) seeking to
obtain damages or (C) otherwise directly or indirectly relating to the
transactions contemplated by the Offer or any such merger or business
combination, (ii) seeking to prohibit the ownership or operation by Parent,
the Purchaser or any other affiliates of Parent of all or any portion of
the business or assets of the Company and its subsidiaries or of the
Purchaser, or to compel Parent, the Purchaser or any other affiliates of
Parent to dispose of or hold separately all or any portion of the business
or assets of the Purchaser or the Company or any of its subsidiaries or
seeking to impose any limitation on the ability of Parent, the Purchaser or
any other affiliates of Parent to conduct their business or own such
assets, (iii) seeking to impose or confirm limitations on the ability of
Parent, the Purchaser or any other affiliates of Parent effectively to
exercise full rights of ownership of the Shares, including, without
limitation, the right to vote any Shares acquired by any such person on all
matters properly presented to the Company's stockholders, (iv) seeking to
require divestiture by Parent, the Purchaser or any other affiliates of
Parent of any Shares, (v) which otherwise, in the sole judgment of the
Purchaser, might materially adversely affect Parent, the Purchaser or any
other affiliates of Parent or the value of the Shares, or (vi) in the sole
judgment of the Purchaser, materially adversely affecting the business,
properties, assets, liabilities, capitalization, stockholders' equity,
condition (financial or other), operations, licenses or franchises, results
of operations or prospects of the Company or any of its subsidiaries, joint
ventures or partnerships; provided that the condition specified in this
paragraph (a) shall not be deemed to exist by reason of any court
proceeding pending on the date hereof and known to the Purchaser, unless in
the sole judgment of the Purchaser there is any adverse development in any
such proceeding after the date hereof, or before the date hereof if not
known to the Purchaser on the date hereof, which might, directly or
indirectly, result in any of the consequences referred to in clauses (i)
through (vi) above;
(b) there shall be any action taken, or any statute, rule, regulation,
interpretation, judgment, order or injunction proposed, enacted, enforced,
promulgated, amended, issued or deemed applicable (i) to the Purchaser,
Parent or any affiliate of Parent or (ii) to the Offer or the Proposed
Merger or other business combination by the Purchaser or Parent or any
affiliate of Parent with the Company, by any court, government or
governmental, administrative or regulatory authority or agency, domestic or
foreign,
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which, in the sole judgment of the Purchaser, might, directly or
indirectly, result in any of the consequences referred to in clauses (i)
through (vi) of paragraph (a) above;
(c) any change (or any condition, event or development involving a
prospective change) shall have occurred or been threatened in the business,
properties, assets, liabilities, capitalization, stockholders' equity,
condition (financial or other), operations, licenses, franchises, permits,
permit applications, results of operations or prospects of the Company or
any of its subsidiaries which, in the sole judgment of the Purchaser, is or
may be materially adverse, or the Purchaser shall have become aware of any
fact which, in the sole judgment of the Purchaser, has or may have material
adverse significance with respect to either the value of the Company or any
of its subsidiaries or the value of the Shares to the Purchaser;
(d) there shall have occurred (i) any general suspension of trading
in, or limitation on prices for, securities on any national securities
exchange or in the over-the-counter market, any decline in either the Dow
Jones Industrial Average or the Standard & Poor's Index of 500 Industrial
Companies by an amount in excess of 15% measured from the close of business
on January 17, 1995 or any material adverse change in prices generally of
shares on the NYSE, (ii) a declaration of a banking moratorium or any
suspension of payments in respect of banks by federal or state authorities
in the United States, (iii) any limitation (whether or not mandatory) by
any governmental authority or agency on, or other event which, in the sole
judgment of the Purchaser, might affect the extension of credit by banks or
other lending institutions, (iv) a commencement of a war, armed hostilities
or other national or international calamity directly or indirectly
involving the United States, (v) a material change in United States or any
other currency exchange rates or a suspension of, or limitation on, the
markets therefor, or (vi) in the case of any of the foregoing existing at
the time of the commencement of the Offer, a material acceleration or
worsening thereof;
(e) the Company or any of its subsidiaries, joint ventures or
partnerships or other affiliates shall have (i) split, combined or
otherwise changed, or authorized or proposed the split, combination or
other change of the Shares or its capitalization, (ii) acquired or
otherwise caused a reduction in the number of, or authorized or proposed
the acquisition or other reduction in the number of, any presently
outstanding Shares or other securities or other equity interests, (iii)
issued, distributed or sold, or authorized or proposed the issuance,
distribution or sale of, additional Shares, other than Shares issued or
sold upon the exercise or conversion (in accordance with the present terms
thereof) of employee stock options outstanding on the date of this Offer to
Purchase, shares of any other class of capital stock or other equity
interests, other voting securities, debt securities or any securities
convertible into, or rights, warrants or options, conditional or otherwise,
to acquire, any of the foregoing, (iv) declared, paid or proposed to
declare or pay any cash dividend or other distribution on any shares of
capital stock of the Company (other than quarterly dividends not exceeding
amounts previously declared by the Company), (v) altered or proposed to
alter any material term of any outstanding security or material contract,
permit or license, (vi) incurred any debt otherwise than in the ordinary
course of business or any debt containing, in the sole judgment of the
Purchaser, burdensome covenants or security provisions, (vii) authorized,
recommended, proposed or entered into an agreement with respect to any
merger, consolidation, recapitalization, liquidation, dissolution, business
combination, acquisition of assets, disposition of assets, release or
relinquishment of any material contractual or other right of the Company or
any of its subsidiaries or any comparable event not in the ordinary course
of business, (viii) authorized, recommended, proposed or entered into, or
announced its intention to authorize, recommend, propose or enter into, any
agreement or arrangement with any person or group that in the Purchaser's
sole opinion could adversely affect either the value of the Company or any
of its subsidiaries, joint ventures or partnerships or the value of the
Shares to the Purchaser, (ix) entered into any employment, change in
control, severance, executive compensation or similar agreement,
arrangement or plan with or for one or more of its employees, consultants
or directors, or entered into or amended, or made grants or awards pursuant
to, any agreements, arrangements or plans so as to provide for increased
benefits to one or more employees, consultants or directors, or taken any
action to fund, secure or accelerate the funding of compensation or
benefits provided for one or more employees, consultants or directors,
whether or not as a result of or in connection with the transactions
contemplated by the Offer, (x) except as may be required by law, taken
29
<PAGE> 30
any action to terminate or amend any employee benefit plan (as defined in
Section 3(c) of the Employee Retirement Income Security Act of 1974, as
amended) of the Company or any of its subsidiaries, or the Purchaser shall
have become aware of any such action which was not previously disclosed in
publicly available filings, or (xi) amended or authorized or proposed any
amendment to its Certificate of Incorporation or Bylaws or similar
organizational documents, or the Purchaser shall become aware that the
Company or any of its subsidiaries shall have proposed or adopted any such
amendment which shall not have been previously disclosed;
(f) a tender or exchange offer for any Shares shall have been made or
publicly proposed to be made by any other person (including the Company or
any of its subsidiaries or affiliates) other than the Joint Offer, or it
shall be publicly disclosed or the Purchaser shall have otherwise learned
that (i) any person, entity (including the Company or any of its
subsidiaries) or "group" (within the meaning of Section 13(d)(3) of the
Exchange Act) shall have acquired (including acquisitions by the Company or
BNI pursuant to the Joint Offer, the BNI/SFP Agreement or otherwise) or
proposed to acquire (other than pursuant to the Joint Offer and the BNI/SFP
Agreement) beneficial ownership of more than 5% of any class or series of
capital stock of the Company (including the Shares), through the
acquisition of stock, the formation of a group or otherwise, or shall have
been granted (including any grant to BNI) any right, option or warrant,
conditional or otherwise, to acquire beneficial ownership of more than 5%
of any class or series of capital stock of the Company (including the
Shares) other than acquisitions for bona fide arbitrage purposes only and
except as disclosed in a Schedule 13D or 13G on file with the Commission on
the date of this Supplement, (ii) any such person, entity or group which
before the date of this Supplement had filed such a Schedule with the
Commission has acquired or proposes to acquire, through the acquisition of
stock, the formation of a group or otherwise, beneficial ownership of 1% or
more of any class or series of capital stock of the Company (including the
Shares), or shall have been granted any right, option or warrant,
conditional or otherwise, to acquire beneficial ownership of 1% or more of
any class or series of capital stock of the Company (including the Shares),
(iii) any person or group shall enter into a definitive agreement or an
agreement in principle or made a proposal with respect to a tender offer or
exchange offer or a merger, consolidation or other business combination
with or involving the Company (other than the Joint Offer and the BNI/SFP
Agreement as in effect on the date of this Supplement), or with respect to
any amendment of or modification to an existing such transaction or
agreement (including the Joint Offer or the BNI/SFP Agreement as in effect
on the date of this Supplement) or (iv) on or after the date of this
Supplement, any person shall have filed a Notification and Report Form
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended
(the "HSR" Act), or made a public announcement reflecting an intent to
acquire the Company or any assets or securities of the Company;
(g) the Purchaser shall have reached an agreement or understanding
with the Company providing for termination of the Offer, or the Purchaser
or any of its affiliates shall have entered into a definitive agreement or
announced an agreement in principle with the Company providing for a merger
or other business combination with the Company or the purchase of stock or
assets of the Company which does not contemplate the Offer;
(h) (i) any material contractual right of the Company or any of its
subsidiaries or affiliates shall be impaired or otherwise adversely
affected or any material amount of indebtedness of the Company or any of
its subsidiaries, joint ventures or partnerships shall become accelerated
or otherwise become due before its stated due date, in either case with or
without notice or the lapse of time or both, as a result of the
transactions contemplated by the Offer or the Proposed Merger or (ii) any
covenant, term or condition in any of the Company's or any of its
subsidiaries', joint ventures' or partnerships' instruments or agreements
is or may be materially adverse to the value of the Shares in the hands of
the Purchaser (including, but not limited to, any event of default that may
ensue as a result of the consummation of the Offer or the Proposed Merger
or the acquisition of control of the Company); or
(i) Parent or the Purchaser shall not have obtained any waiver,
consent, extension, approval, action or non-action from any governmental
authority or agency (other than approval by the ICC of the acquisition of
control of the Company) which is necessary to consummate the Offer;
30
<PAGE> 31
which, in the sole judgment of the Purchaser in any such case, and regardless of
the circumstances (including any action or inaction by the Purchaser or any of
its affiliates) giving rise to any such condition, makes it inadvisable to
proceed with the Offer and/or with such acceptance for payment or payment.
The foregoing conditions are for the sole benefit of the Purchaser and may
be asserted by the Purchaser in its sole discretion regardless of the
circumstances (including any action or omission by the Purchaser) giving rise to
any such conditions or may be waived by the Purchaser in its sole discretion in
whole or in part at any time and from time to time. The failure by the Purchaser
at any time to exercise any of the foregoing rights shall not be deemed a waiver
of any such right and each such right shall be deemed an ongoing right which may
be asserted at any time and from time to time. Any determination by the
Purchaser concerning any condition or event described in this Section 11 shall
be final and binding upon all parties.
12. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS. The discussion set forth
in Section 15 of the Offer to Purchase is hereby amended and supplemented as
follows:
ICC Matters; The Voting Trust. On November 10, 1994, the Purchaser filed
with the ICC a draft form of voting trust agreement (the "Draft Voting Trust
Agreement") in connection with the Purchaser's application requesting an
informal, non-binding opinion that the use of the Voting Trust is consistent
with the policies of the ICC against unauthorized acquisitions of control of a
regulated carrier.
On November 28, 1994, Parent received an informal, non-binding opinion from
the staff of the ICC authorizing the use of the Voting Trust in its proposed
acquisition of the Company.
Also on November 28, 1994, the ICC, acting through Chairman McDonald (the
"Chairman"), denied petitions of BNI's railroad subsidiary, Burlington Northern
Railroad Company ("BN") and the Kansas City Southern Railway Company ("KCS") and
a letter request of the State of Colorado Department of Transportation, all
seeking to have the ICC formally investigate, and solicit public comment on,
Parent's proposed Voting Trust, and a petition of a number of railroad unions
(the "Rail Unions") seeking various declaratory orders with regard to the Voting
Trust. BN, KCS and the Rail Unions subsequently appealed this decision to the
full ICC, and Parent filed an opposition to these administrative appeals.
On December 6, 1994, the ICC issued a decision denying a request by BN and
others that the ICC staff's informal opinion letter be withdrawn pending
resolution of the administrative appeals, and indicating that a decision on
those appeals would be forthcoming shortly.
On December 7, 1994, BN filed actions in the United States Court of Appeals
for the Third Circuit (the "Third Circuit") seeking review of the December 6,
1994 decision and an injunction barring Parent and the Purchaser from placing
the Shares in the Voting Trust until the ICC conducted a formal investigation.
On December 12, 1994, Parent filed an opposition to BN's injunction request
in the Third Circuit. On December 12, 1994, the ICC filed a memorandum with the
Third Circuit indicating that the ICC would shortly be deciding the
administrative appeals, and urging the court to refrain from issuing any
dispositive orders in the meantime. On December 14, BN filed a reply in support
of its injunction request.
On December 12, 1994, the Rail Unions filed petitions in the Third Circuit
seeking a writ of mandamus against the ICC directing the ICC to investigate the
Voting Trust and bar Parent and the Purchaser from using the Voting Trust, and
an injunction against Parent and the Purchaser prohibiting the use of the Voting
Trust until the ICC has granted Parent authority to control the Company's
railroad business. On December 16, 1994, Parent filed an opposition to these
petitions. On December 16, 1994, the ICC filed a memorandum with the Third
Circuit indicating that the ICC would shortly be deciding the administrative
appeals, and that the Rail Unions' action should thus be dismissed as moot.
On December 20, 1994, the ICC issued a decision of the full commission
denying the administrative appeals of BN, KCS and the Rail Unions from the
Chairman's initial decision and approving the Voting Trust subject to a
modification clarifying the authority of the ICC to approve any plan of
divestiture or sale of the stock held in trust. On December 20, the ICC also
filed a motion with the Third Circuit to dismiss BN's December 7, 1994 review
petition and the Rail Unions' December 12, 1994 mandamus petition, and
suggesting that requests for an injunction against Parent and the Purchaser also
be dismissed.
31
<PAGE> 32
Also on December 20, 1994, BN filed a petition in the Third Circuit for
review of the ICC's December 20, 1994 decision. On December 21, 1994, BN filed a
petition with the ICC requesting a stay of the Commission's December 20, 1994
decision pending judicial review and a temporary cease and desist order against
Parent to prohibit implementation of the Voting Trust pending judicial review.
On January 5, 1995, the Rail Unions filed a similar petition. On December 22,
1994, Parent filed an opposition to the BN petition, and on January 17, 1995,
Parent filed an opposition to the Rail Unions' petition.
On December 28, 1994, BN filed in the Third Circuit an opposition to the
ICC's December 20, 1994 motion, stating that BN agreed that BN's December 7,
1994 appeal is moot and could be dismissed, but denying that BN's injunction
request should be dismissed. The Rail Unions filed a similar opposition on
January 12, 1995.
On January 6, 1995, the ICC denied the petition filed by BN with the ICC on
December 21, 1994.
On January 10, 1995, BN filed a motion in the Third Circuit seeking a stay
pending judicial review of the ICC's December 20, 1994 decision. On January 11,
1995, the Rail Unions filed a response in support of the BN motion, and on
January 13, 1995, the Rail Unions filed their own, similar stay request. On
January 12, 1995, Parent filed an opposition to the BN motion, and on January
18, 1995, Parent filed an opposition to the Rail Unions' stay request.
On January 10, 1995, the Rail Unions filed a petition in the United States
Court of Appeals for the Tenth Circuit for review of the ICC's December 20, 1994
decision, and a motion for transfer of this review proceeding to the Third
Circuit.
On January 13, 1995, the Third Circuit issued an order denying the requests
of BN and the Rail Unions for an injunction against Parent, and dismissing as
moot BN's December 7, 1994 review petition and the Rail Unions' December 12,
1994 mandamus petition.
Certain Litigation. Set forth below is a description of certain litigation
that has occurred since the date of the Offer to Purchase and prior to the date
of this Supplement with respect to the Offer.
On January 18, 1995, Parent and Mr. Shattuck moved the Court of Chancery in
the State of Delaware for leave to file their Second Amended Complaint. In the
proposed Second Amended Complaint, the plaintiffs have withdrawn as moot their
claims against the Original BNI/SFP Agreement and have alleged, among other
things, that the Company and members of the Company's Board have breached their
fiduciary duties by (i) entering into the BNI/SFP Agreement without upholding
their obligation to act reasonably to seek the transaction offering the best
value reasonably available to the stockholders in a sale of the Company; (ii)
failing to implement fair and equal procedures for the acceptance and
consideration of competing bids for the purchase of the Company; (iii)
improperly agreeing to the termination fee and expense reimbursement provisions
of the BNI/SFP Agreement; and (iv) improperly adopting a discriminatory
stockholder rights plan in response to the Offer.
The Second Amended Complaint seeks an order of final judgment, inter alia
(a) requiring the Company and the Company's Directors to adopt fair and
equitable procedures for the acceptance and consideration of competing bids for
the Company; (b) enjoining the operation of the Rights pursuant to the Rights
Agreement and declaring the Rights inapplicable or unenforceable as applied to
the Offer and the Proposed Merger; (c) declaring that the termination fee and
expense reimbursement provisions of the BNI/SFP Agreement are invalid and
unenforceable; and (d) declaring that Parent has not tortiously interfered with
the contractual or other legal rights of BNI or the Company.
13. MISCELLANEOUS.
No person has been authorized to give any information or make any
representation on behalf of Parent or the Purchaser not contained in this
Supplement to the Offer to Purchase and, if given or made, such information or
representation must not be relied upon as having been authorized.
Parent and the Purchaser have filed with the Commission a Tender Offer
Statement on Schedule 14D-1 and amendments thereto, together with exhibits,
pursuant to Rule 14d-3 of the General Rules and Regulations under the Exchange
Act, furnishing certain additional information with respect to the Offer, and
may file
32
<PAGE> 33
additional amendments thereto. The Schedule 14D-1 and any amendments thereto,
including exhibits, may be inspected at, and copies may be obtained from, the
same places and in the same manner as set forth in Section 7 of the Offer to
Purchase (except that they will not be available at the regional offices of the
Commission).
EXCEPT AS OTHERWISE SET FORTH IN THIS SUPPLEMENT, THE TERMS AND CONDITIONS
PREVIOUSLY SET FORTH IN THE OFFER TO PURCHASE REMAIN APPLICABLE IN ALL RESPECTS
TO THE OFFER, AND THIS SUPPLEMENT SHOULD BE READ IN CONJUNCTION WITH THE OFFER
TO PURCHASE. UNLESS THE CONTEXT REQUIRES OTHERWISE, TERMS NOT DEFINED HEREIN
HAVE THE MEANINGS ASCRIBED TO THEM IN THE OFFER TO PURCHASE.
January 18, 1995
UP ACQUISITION CORPORATION
33
<PAGE> 34
Facsimile copies of the revised Letter of Transmittal, properly completed
and duly signed, will be accepted. The revised Letter of Transmittal,
certificates for the Shares and any other required documents should be sent by
each stockholder of the Company or his broker, dealer, commercial bank, trust
company or other nominee to the Depositary as follows:
The Depositary for the Offer is:
CITIBANK, N.A.
<TABLE>
<S> <C> <C>
By Mail: By Facsimile Transmission: By Hand:
Citibank, N.A. (For Eligible Institutions Citibank, N.A.
c/o Citicorp Data only) Corporate Trust Window
Distribution, Inc. (201) 262-3240 111 Wall Street, 5th Floor
P.O. Box 1429 New York, New York
Paramus, New Jersey 07653
By Overnight Courier: Confirm By Telephone: By Telex:
Citibank, N.A. (800) 422-2066 (710) 990-4964
c/o Citicorp Data Answer Back: CDDI PARA
Distribution, Inc.
404 Sette Drive
Paramus, New Jersey 07652
</TABLE>
------------------------------
Any questions or requests for assistance or additional copies of the Offer
to Purchase, this Supplement, the revised Letter of Transmittal and the revised
Notice of Guaranteed Delivery may be directed to the Information Agent or the
Dealer Manager at their respective telephone numbers and locations listed below.
You may also contact your broker, dealer, commercial bank or trust company or
other nominee for assistance concerning the Offer.
The Information Agent for the Offer is:
Morrow & Co., Inc.
<TABLE>
<S> <C>
909 Third Avenue, 20th Floor 39 South LaSalle Street
New York, New York 10022 Chicago, Illinois 60603
(212) 754-8000 (312) 444-1150
(Call Collect) (Call Collect)
</TABLE>
or
Call Toll Free 1-800-662-5200
The Dealer Manager for the Offer is:
CS First Boston Corporation
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
(212) 909-2000 (Call Collect)
<PAGE> 1
LETTER OF TRANSMITTAL
TO TENDER SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED SHARE PURCHASE RIGHTS)
OF
SANTA FE PACIFIC CORPORATION
AT
$18.50 NET PER SHARE
PURSUANT TO THE OFFER TO PURCHASE DATED NOVEMBER 9, 1994
AND
THE SUPPLEMENT DATED JANUARY 18, 1995
BY
UP ACQUISITION CORPORATION
A WHOLLY-OWNED SUBSIDIARY
OF
UNION PACIFIC CORPORATION
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON TUESDAY, FEBRUARY 7, 1995,
UNLESS THE OFFER IS EXTENDED
The Depositary for the Offer is:
CITIBANK, N.A.
<TABLE>
<S> <C> <C> <C>
By Mail: By Facsimile Overnight Express By Hand:
Transmission: Mail Courier:
Citibank, N.A. (For Eligible Citibank, N.A. Citibank, N.A.
c/o Citicorp Data Institutions Only) c/o Citicorp Data Corporate Trust Window
Distribution, Inc. (201)262-3240 Distribution, Inc. 111 Wall Street, 5th Floor
P.O. Box 1429 404 Sette Drive New York, New York
Paramus, New Jersey 07653 Paramus, New Jersey 07652
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION OTHER THAN AS SET FORTH
ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
THIS REVISED LETTER OF TRANSMITTAL OR THE PREVIOUSLY CIRCULATED GOLD LETTER
OF TRANSMITTAL IS TO BE USED EITHER IF CERTIFICATES EVIDENCING SHARES AND/OR
RIGHTS (EACH AS DEFINED BELOW) ARE TO BE FORWARDED HEREWITH OR, UNLESS AN
AGENT'S MESSAGE (AS DEFINED IN THE OFFER TO PURCHASE) IS UTILIZED, IF DELIVERY
OF SHARES AND/OR RIGHTS IS TO BE MADE BY BOOK-ENTRY TRANSFER TO THE ACCOUNT
MAINTAINED BY THE DEPOSITARY AT THE DEPOSITORY TRUST COMPANY, THE MIDWEST
SECURITIES TRUST COMPANY OR THE PHILADELPHIA DEPOSITORY TRUST COMPANY (EACH, A
"BOOK-ENTRY TRANSFER FACILITY" AND, COLLECTIVELY, THE "BOOK-ENTRY TRANSFER
FACILITIES") PURSUANT TO THE PROCEDURES SET FORTH IN SECTION 3 OF THE OFFER TO
PURCHASE DATED NOVEMBER 9, 1994 (THE "OFFER TO PURCHASE") AND SECTION 2 OF THE
SUPPLEMENT DATED JANUARY 18, 1995 (THE "SUPPLEMENT").
<PAGE> 2
STOCKHOLDERS WHO HAVE PREVIOUSLY VALIDLY TENDERED SHARES PURSUANT TO THE
OFFER USING THE GOLD LETTER OF TRANSMITTAL OR THE BLUE NOTICE OF GUARANTEED
DELIVERY AND WHO HAVE NOT PROPERLY WITHDRAWN SUCH SHARES HAVE VALIDLY TENDERED
SUCH SHARES FOR THE PURPOSES OF THE OFFER, AS AMENDED, AND NEED NOT TAKE ANY
FURTHER ACTION.
IF THE PURCHASER DECLARES THAT THE RIGHTS CONDITION (AS DEFINED IN THE
SUPPLEMENT) IS SATISFIED, THE PURCHASER WILL NOT REQUIRE DELIVERY OF THE RIGHTS.
UNLESS AND UNTIL THE PURCHASER DECLARES THAT THE RIGHTS CONDITION IS SATISFIED,
HOLDERS OF SHARES WILL BE REQUIRED TO TENDER ONE RIGHT FOR EACH SHARE TENDERED
TO EFFECT A VALID TENDER OF SUCH SHARE. If Right Certificates (as defined in the
Supplement) have been distributed to holders of Shares prior to the date of
tender pursuant to the Offer, Right Certificates representing a number of Rights
equal to the number of Shares being tendered must be delivered to the Depositary
in order for such Shares to be validly tendered. If Right Certificates have not
been distributed prior to the time Shares are tendered pursuant to the Offer, a
tender of Shares without Rights constitutes an agreement by the tendering
stockholder to deliver Right Certificates representing a number of Rights equal
to the number of Shares tendered pursuant to the Offer to the Depositary within
five New York Stock Exchange, Inc. ("NYSE") trading days after the date Right
Certificates are distributed. The Purchaser reserves the right to require that
it receive such Right Certificates prior to accepting Shares for payment.
Payment for Shares tendered and purchased pursuant to the Offer will be made
only after timely receipt by the Depositary of, among other things, Right
Certificates, if such certificates have been distributed to holders of Shares.
The Purchaser will not pay any additional consideration for the Rights tendered
pursuant to the Offer.
Holders whose certificates for Shares and, if applicable, Rights, are not
immediately available (including, if the Distribution Date has occurred, but
Right Certificates have not yet been distributed by the Company), or who cannot
deliver confirmation of the book-entry transfer of their Shares into the
Depositary's account at a Book-Entry Transfer Facility ("Book-Entry
Confirmation") and all other documents required hereby to the Depositary on or
prior to the Expiration Date (as defined in Section 1 of the Supplement), must
tender their Shares and Rights according to the guaranteed delivery procedures
set forth in Section 3 of the Offer to Purchase and Section 2 of the Supplement.
See Instruction 2 of this Letter of Transmittal. Delivery of documents to a
Book-Entry Transfer Facility does not constitute delivery to the Depositary.
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
MADE TO THE ACCOUNT MAINTAINED BY THE DEPOSITARY WITH A BOOK-ENTRY TRANSFER
FACILITY AND COMPLETE THE FOLLOWING:
Name of Tendering Institution:
-----------------------------------------------------------------------------
Check Box of Book-Entry Transfer Facility:
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
Account Number
- --------------------------------------------------------------------------------
Transaction Code Number
- --------------------------------------------------------------------------------
/ / CHECK HERE IF TENDERED RIGHTS ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
MADE TO THE ACCOUNT MAINTAINED BY THE DEPOSITARY WITH A BOOK-ENTRY TRANSFER
FACILITY AND COMPLETE THE FOLLOWING:
Name of Tendering Institution:
-----------------------------------------------------------------------------
Check Box of Book-Entry Transfer Facility:
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
Account Number
- --------------------------------------------------------------------------------
Transaction Code Number
-----------------------------------------------------------------------------
2
<PAGE> 3
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE
FOLLOWING:
Name(s) of Registered Owner(s):
--------------------------------------------
Date of Execution of Notice of Guaranteed Delivery:
------------------------
Name of Institution that Guaranteed Delivery:
------------------------------
If Delivered by Book-Entry Transfer, Check Box of Book-Entry Transfer
Facility:
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
Account Number
-------------------------------------------------------------
Transaction Code Number
----------------------------------------------------
/ / CHECK HERE IF TENDERED RIGHTS ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE
FOLLOWING:
Name(s) of Registered Owner(s):
--------------------------------------------
Date of Execution of Notice of Guaranteed Delivery:
------------------------
Name of Institution that Guaranteed Delivery:
------------------------------
If Delivered by Book-Entry Transfer, Check Box of Book-Entry Transfer
Facility:
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
Account Number
-------------------------------------------------------------
Transaction Code Number
----------------------------------------------------
3
<PAGE> 4
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
- ---------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S) SHARE CERTIFICATE(S) TENDERED
(PLEASE FILL IN, IF BLANK) (ATTACH ADDITIONAL LIST IF NECESSARY)
- ---------------------------------------------------------------------------------------------------------
TOTAL NUMBER OF
SHARES NUMBER OF
CERTIFICATE REPRESENTED SHARES
NUMBER(S)* BY CERTIFICATE(S) TENDERED**
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
TOTAL SHARES
- ---------------------------------------------------------------------------------------------------------
* Need not be completed by stockholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares being delivered to the Depositary are
being tendered. See Instruction 4.
- ---------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
DESCRIPTION OF RIGHTS TENDERED
- ---------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S) RIGHT CERTIFICATE(S) TENDERED*
(PLEASE FILL IN, IF BLANK) (ATTACH ADDITIONAL LIST IF NECESSARY)
- ---------------------------------------------------------------------------------------------------------
TOTAL NUMBER OF
RIGHTS
RIGHT REPRESENTED NUMBER OF
CERTIFICATE BY RIGHT RIGHTS
NUMBER(S)** CERTIFICATE(S) TENDERED***
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
TOTAL RIGHTS
- ---------------------------------------------------------------------------------------------------------
* If the tendered Rights are represented by separate Right Certificates, complete the certificate
numbers of such Right Certificates. Stockholders tendering Rights which are not represented by
separate certificates will need to submit an additional letter of transmittal if Right Certificates
are received.
** Need not be completed by stockholders tendering by book-entry transfer.
*** Unless otherwise indicated, it will be assumed that all Rights being delivered to the Depositary
are being tendered. See Instruction 4.
- ---------------------------------------------------------------------------------------------------------
</TABLE>
The names and addresses of the registered holders should be printed, if
not already printed above, exactly as they appear on the certificates
representing Shares and/or Rights tendered hereby. The certificates and number
of Shares and/or Rights that the undersigned wishes to tender should be
indicated in the appropriate boxes.
4
<PAGE> 5
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ CAREFULLY THE ACCOMPANYING INSTRUCTIONS.
Ladies and Gentlemen:
The undersigned hereby tenders to UP Acquisition Corporation (the
"Purchaser"), a Utah corporation, and a wholly-owned subsidiary of Union Pacific
Corporation, a Utah corporation, the above described shares of common stock, par
value $1.00 per share (the "Shares"), of Santa Fe Pacific Corporation, a
Delaware corporation (the "Company"), including (unless and until the Purchaser
declares that the Rights Condition (as defined in the Supplement) is satisfied)
the associated preferred share purchase rights (the "Rights") issued pursuant to
the Rights Agreement, dated as of November 28, 1994, between the Company and
First Chicago Trust Company of New York, as Rights Agent (the "Rights
Agreement"), pursuant to the Purchaser's offer to purchase all of the
outstanding Shares of the Company at a price of $18.50 per Share, net to the
seller in cash, without interest thereon upon the terms and subject to the
conditions set forth in the Offer to Purchase dated November 9, 1994 (the "Offer
to Purchase"), the Supplement dated January 18, 1995 (the "Supplement"), receipt
of which is hereby acknowledged, and this Letter of Transmittal (which, as
amended from time to time, together constitute the "Offer"). Unless the context
requires otherwise, all references to Shares herein shall include the Rights,
and all references to the Rights shall include all benefits that may inure to
the holders of the Rights pursuant to the Rights Agreement. The Purchaser
reserves the right to transfer or assign in whole or from time to time in part,
to one or more of its affiliates the right to purchase Shares and/or Rights
tendered pursuant to the Offer.
Subject to, and effective upon, acceptance for payment of the Shares and/or
Rights tendered herewith in accordance with the terms and subject to the
conditions of the Offer, the undersigned hereby sells, assigns, and transfers
to, or upon the order of, the Purchaser all right, title and interest in and to
all the Shares and/or Rights that are being tendered hereby (and any and all
other Shares, rights or other securities issued or issuable in respect thereof
on or after November 9, 1994) and irrevocably constitutes and appoints the
Depositary the true and lawful agent and attorney-in-fact of the undersigned
with respect to such Shares and/or Rights (and any such other Shares or
securities) with full power of substitution (such power of attorney being deemed
to be an irrevocable power coupled with an interest), to (a) deliver
certificates for such Shares and/or Rights (and any such other Shares or
securities), or transfer ownership of such Shares and/or Rights (and any such
other Shares or securities) on the account books maintained by a Book-Entry
Transfer Facility, together in either such case with all accompanying evidences
of transfer and authenticity, to or upon the order of the Purchaser upon receipt
by the Depositary, as the undersigned's agent, of the purchase price (adjusted,
if appropriate, as provided in the Offer to Purchase), (b) present such Shares
and/or Rights (and any such other Shares or securities) for transfer on the
books of the Company and (c) receive all benefits and otherwise exercise all
rights of beneficial ownership of such Shares and/or Rights (and any other such
Shares or securities), all in accordance with the terms of the Offer.
The undersigned understands that unless the Rights are redeemed prior to
the expiration of the Offer, stockholders will be required to tender one Right
for each Share tendered in order to effect a valid tender of such Share. The
undersigned understands that if Right Certificates have been distributed to
holders of Shares prior to the date of tender pursuant to the Offer, Right
Certificates representing a number of Rights equal to the number of Shares being
tendered herewith must be delivered to the Depositary or, if available, a
Book-Entry Confirmation (as defined in Instruction 2) must be received by the
Depositary with respect thereto. If Right Certificates have not been distributed
prior to the time Shares are tendered herewith, the undersigned agrees hereby to
deliver Right Certificates representing a number of Rights equal to the number
of Shares tendered herewith to the Depositary within five NYSE trading days
after the date such Right Certificates are distributed. The Purchaser reserves
the right to require that the Depositary receive such Right Certificates, or a
Book-Entry Confirmation, with respect to such Rights, prior to accepting Shares
for payment. Payment for Shares tendered and accepted for payment pursuant to
the Offer will be made only after timely receipt by the Depositary of, among
other things, Right Certificates if such Certificates have been distributed to
holders of Shares. The Purchaser will not pay any additional consideration for
the Rights tendered pursuant to the Offer.
If, on or after November 9, 1994, the Company should declare or pay any
cash or stock dividend (other than regular cash dividends on the Shares, not in
excess of $.10 per Share, annually) or other distribution on, or issue any
rights (other than the separation of the Rights from the Shares) with respect
to, the Shares (other than the Redemption Price (as defined in the Supplement)),
payable or distributable to stockholders of record on a date before the transfer
to the name of the Purchaser or its nominee or transferee on the Company's stock
transfer records of the Shares accepted for payment pursuant to the Offer, then,
subject to the provisions of Section 11 of the Supplement, (i) the purchase
price per Share payable by the Purchaser pursuant to the Offer will be reduced
by the amount of any such cash dividend or cash distribution and (ii) the whole
of any such non-cash dividend, distribution or right will be received and held
by the tendering stockholder for the account of the Purchaser and shall be
required to be promptly remitted and transferred by each tendering stockholder
to the Depositary for the account of the Purchaser, accompanied by appropriate
documentation of transfer. Pending such remittance, the Purchaser will be
entitled to all rights and privileges as owner of any such non-cash dividend,
distribution or right and may withhold the entire purchase price or deduct from
the purchase price the amount of value thereof, as determined by the Purchaser
in its sole discretion.
The undersigned hereby irrevocably appoints, L. White Matthews, III,
Richard K. Davidson and Judy L. Swantak and each of them, the attorneys-in-fact
and proxies of the undersigned, each with full power of substitution to the full
extent of such stockholder's rights with respect to tendered Shares and Rights
(and any and all other Shares or securities
5
<PAGE> 6
or rights issued or issuable in respect thereof on or after November 9, 1994),
to vote (subject to the terms of the Voting Trust Agreement (as defined in the
Offer) so long as it shall be in effect with respect to the Shares) in such
manner as each such attorney and proxy or his substitute shall in his sole
discretion deem proper, and otherwise act (including without limitation pursuant
to written consent) with respect to all the Shares and Rights tendered hereby
which have been accepted for payment by the Purchaser prior to the time of such
vote or action, which the undersigned is entitled to vote at any meeting of
stockholders (whether annual or special and whether or not an adjourned meeting)
of the Company, or otherwise. This proxy is coupled with an interest in the
Company and in the Shares and Rights and is irrevocable and is granted in
consideration of, and is effective when, if and to the extent that the Purchaser
accepts such Shares and Rights for payment pursuant to the Offer. Such
acceptance for payment shall revoke, without further action, all prior proxies
granted by the undersigned at any time with respect to such Shares and Rights
(and any such other Shares or other securities) and no subsequent proxies will
be given (and if given will be deemed not to be effective) with respect thereto
by the undersigned. The undersigned acknowledges that in order for Shares and
Rights to be deemed validly tendered, immediately upon the acceptance for
payment of such Shares and Rights, the Purchaser or the Purchaser's designee
must be able to exercise full voting and all other rights which inure to a
record and beneficial holder with respect to such Shares and Rights.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Shares and
Rights tendered hereby (and any and all other Shares or other securities issued
or issuable in respect thereof on or after November 9, 1994), and that, when the
same are accepted for payment by the Purchaser, the Purchaser will acquire good,
marketable and unencumbered title thereto, free and clear of all liens,
restrictions, charges and encumbrances and the same will not be subject to any
adverse claim. The undersigned, upon request, will execute and deliver any
additional documents deemed by the Depositary or the Purchaser to be necessary
or desirable to complete or confirm the sale, assignment and transfer of the
Shares and Rights tendered hereby (and any and all such other Shares or other
securities).
All authority herein conferred or agreed to be conferred in this Letter of
Transmittal shall not be affected by, and shall survive, the death or incapacity
of the undersigned, and any obligation of the undersigned hereunder shall be
binding upon the successors, assigns, heirs, executors, administrators, trustees
in bankruptcy, personal and legal representatives of the undersigned. Except as
stated in the Offer to Purchase or in the Supplement, this tender is irrevocable
provided that Shares and Rights tendered pursuant to the Offer may be withdrawn
at any time prior to their acceptance for payment.
The undersigned understands that tenders of Shares and Rights pursuant to
any one of the procedures described in Section 3 of the Offer to Purchase,
Section 2 of the Supplement and the instructions hereto will constitute a
binding agreement between the undersigned and the Purchaser upon the terms and
subject to the conditions of the Offer. The undersigned recognizes that under
certain circumstances set forth in the Offer to Purchase and in the Supplement,
Purchaser may not be required to accept for payment any of the Shares and Rights
tendered hereby.
Unless otherwise indicated herein under "Special Payment Instructions,"
please issue the check for the purchase price and/or return any certificates for
Shares or Rights not tendered or accepted for payment in the name(s) of the
undersigned. Similarly, unless otherwise indicated under "Special Delivery
Instructions," please mail the check for the purchase price and/or return any
certificates for Shares or Rights not tendered or accepted for payment (and
accompanying documents, as appropriate) to the undersigned at the address shown
below the undersigned's signature. In the event that both the Special Delivery
Instructions and the Special Payment Instructions are completed, please issue
the check for the purchase price and/or return any certificates for Shares or
Rights not tendered or accepted for payment in
6
<PAGE> 7
the name of, and deliver such check and/or return such certificates to, the
person or persons so indicated. Stockholders delivering Shares or Rights by
book-entry transfer may request that any Shares or Rights not accepted for
payment be returned by crediting such account maintained at a Book-Entry
Transfer Facility as such stockholder may designate by making an appropriate
entry under "Special Payment Instructions." The undersigned recognizes that the
Purchaser has no obligation pursuant to the Special Payment Instructions to
transfer any Shares or Rights from the name of the registered holder thereof if
the Purchaser does not accept for payment any of the Shares or Rights so
tendered.
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6, AND 7)
To be completed ONLY if certificates for Shares and/or Rights not tendered
or not purchased and/or the check for the purchase price of Shares and/or Rights
purchased are to be issued in the name of someone other than the undersigned, or
if Shares and/or Rights delivered by book-entry transfer which are not purchased
are to be returned by credit to an account maintained at a Book-Entry Transfer
Facility other than that designated above.
Issue check and/or certificates to:
Name
----------------------------------------------------------------------------
(PLEASE PRINT)
Address
-------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(ZIP CODE)
- --------------------------------------------------------------------------------
(TAXPAYER IDENTIFICATION OR SOCIAL SECURITY NUMBER)
(ALSO COMPLETE SUBSTITUTE FORM W-9 BELOW)
/ / Credit unpurchased Shares and/or Rights delivered by book-entry transfer to
the Book-Entry Transfer Facility account set forth below.
Check appropriate box:
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
- --------------------------------------------------------------------------------
(ACCOUNT NUMBER)
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if certificates for Shares and/or Rights not tendered
or not purchased and/or the check for the purchase price of Shares and/or Rights
purchased are to be sent to someone other than the undersigned, or to the
undersigned at an address other than that shown above.
Mail check and/or certificates to:
Name
----------------------------------------------------------------------------
(PLEASE PRINT)
Address
-------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(ZIP CODE)
7
<PAGE> 8
SIGN HERE
(COMPLETE SUBSTITUTE FORM W-9 ON REVERSE)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SIGNATURE(S) OF HOLDER(S)
Dated: , 1995
(Must be signed by registered holder(s) exactly as name(s) appear(s) on stock
certificate(s) or on a security position listing or by person(s) authorized to
become registered holder(s) by certificates and documents transmitted herewith.
If signature is by trustees, executors, administrators, guardians,
attorneys-in-fact, agents, officers of corporations or others acting in a
fiduciary or representative capacity, please provide the following information.
See Instruction 5.)
Name(s)
------------------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title)
----------------------------------------------------------
Address
------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number
-------------------------------------------------
Tax Identification or
Social Security No.
------------------------------------------------------------
(COMPLETE SUBSTITUTE FORM W-9 ON REVERSE)
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 1 AND 5)
Authorized Signature
-----------------------------------------------------------
Name
---------------------------------------------------------------------------
(PLEASE PRINT)
Title
--------------------------------------------------------------------------
Name of Firm
-------------------------------------------------------------------
Address
------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number
-------------------------------------------------
Dated: , 1995
8
<PAGE> 9
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. Guarantee of Signatures. No signature guarantee on this Letter of
Transmittal is required (i) if this Letter of Transmittal is signed by the
registered holder of the Shares and/or Rights (which term, for purposes of this
document, shall include any participant in a Book-Entry Transfer Facility whose
name appears on a security position listing as the owner of Shares or Rights) of
the Shares and/or Rights tendered herewith, unless such holder has completed
either the box entitled "Special Delivery Instructions" or the box entitled
"Special Payment Instructions" on the reverse hereof, or (ii) if such Shares
and/or Rights are tendered for the account of a member firm of a registered
national securities exchange, a member of the National Association of Securities
Dealers, Inc. or a commercial bank or trust company having an office or
correspondent in the United States (each of the foregoing being referred to as
an "Eligible Institution"). In all other cases, all signatures on this Letter of
Transmittal must be guaranteed by an Eligible Institution. See Instruction 5.
2. Delivery of Letter of Transmittal and Certificates. This Letter of
Transmittal is to be completed by stockholders either if certificates are to be
forwarded herewith or if tenders are to be made pursuant to the procedures for
delivery by book-entry transfer set forth in Section 3 of the Offer to Purchase.
Certificates for all physically tendered Shares and/or Rights, or any Book-Entry
Confirmation of Shares and/or Rights, as the case may be, as well as a properly
completed and duly executed Letter of Transmittal (or manually signed facsimile
thereof), with any required signature guarantees, or an Agent's Message (as
defined below), in the case of a book-entry delivery, and any other documents
required by this Letter of Transmittal must be transmitted to and received by
the Depositary at one of its addresses set forth herein prior to the Expiration
Date and, unless and until the Purchaser declares that the Rights Condition is
satisfied, Right Certificates, or Book-Entry Confirmation of a transfer of
Rights into the Depositary's account at a Book-Entry Transfer Facility, if
available (together with, if Rights are forwarded separately from Shares, a
properly completed and duly executed Letter of Transmittal (or a facsimile
thereof) with any required signature guarantee, or an Agent's Message in the
case of a book-entry delivery, and any other documents required by the Letter of
Transmittal), must be received by the depositary at one of its addresses set
forth herein prior to the Expiration Date or, if later, within five NYSE trading
days after the date on which such Right Certificates are distributed. If a
holder's Share Certificates and, if applicable, Right Certificates, are not
immediately available (including, if Right Certificates have not yet been
distributed) or time will not permit all required documents to reach the
Depositary prior to the Expiration Date, or the procedure for book-entry
transfer cannot be completed on a timely basis, such holder's Shares and/or
Rights may nevertheless be tendered by properly completing and duly executing
the Notice of Guaranteed Delivery pursuant to the guaranteed delivery procedure
set forth in Section 3 of the Offer to Purchase and Section 2 of the Supplement.
Pursuant to such procedure, (i) such tender must be made by or through an
Eligible Institution, (ii) a properly completed and duly executed Notice of
Guaranteed Delivery, substantially in the form provided by the Purchaser, must
be received by the Depositary prior to the Expiration Date, and (iii) in the
case of a guarantee of Shares and/or Rights, the certificates for all tendered
Shares and/or Rights, in proper form for transfer, or a Book-Entry Confirmation,
together with a properly completed and duly executed Letter of Transmittal (or
manually signed facsimile thereof) with any required signature guarantee (or, in
the case of a book-entry transfer, an Agent's Message) and any other documents
required by such Letter of Transmittal, must be received by the Depositary (a)
in the case of Shares, within five NYSE trading days after the date of execution
of such Notice of Guaranteed Delivery or (b) in the case of Rights, within a
period ending on the later of (i) five NYSE trading days after the date of
execution of such Notice of Guaranteed Delivery or (ii) five business days after
Right Certificates are distributed to stockholders by the Company. If Share
Certificates and Right Certificates are forwarded separately to the Depositary,
a properly completed and duly executed Letter of Transmittal (or facsimile
thereof) must accompany each such delivery. The term "Agent's Message" means a
message, transmitted by a Book-Entry Transfer Facility to, and received by, the
Depositary and forming a part of a Book-Entry Confirmation, which states that
such Book-Entry Transfer Facility has received an express acknowledgement from
the participant in such Book-Entry Transfer Facility tendering the Shares or
Rights, that such participant has received and agrees to be bound by the terms
of this Letter of Transmittal and that the Purchaser may enforce such agreement
against the participant.
THE METHOD OF DELIVERY OF THIS LETTER OF TRANSMITTAL, SHARE CERTIFICATES,
AND, IF APPLICABLE, RIGHT CERTIFICATES, AND ALL OTHER REQUIRED DOCUMENTS,
INCLUDING DELIVERY THROUGH ANY BOOK-ENTRY TRANSFER FACILITY, IS AT THE OPTION
AND RISK OF THE TENDERING STOCKHOLDER, AND THE DELIVERY WILL BE DEEMED MADE ONLY
WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF DELIVERY IS BY MAIL, REGISTERED
MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL
CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY. EXCEPT AS
OTHERWISE PROVIDED IN THIS INSTRUCTION 2, THE DELIVERY WILL BE DEEMED MADE ONLY
WHEN ACTUALLY RECEIVED BY THE DEPOSITARY.
9
<PAGE> 10
No alternative, conditional or contingent tenders will be accepted and no
fractional Shares or Rights will be purchased. All tendering stockholders, by
execution of this Letter of Transmittal (or a manually signed facsimile
thereof), waive any right to receive any notice of the acceptance of their
Shares or Rights for payment.
3. Inadequate Space. If the space provided herein is inadequate, the
certificate numbers and/or the number of Shares and, if applicable, Rights
should be listed on a separate signed schedule attached hereto.
4. Partial Tenders. (Not applicable to stockholders who tender by
book-entry transfer.) If fewer than all the Shares or Rights evidenced by any
certificate submitted are to be tendered, fill in the number of Shares or Rights
which are to be tendered in the box entitled "Description of Shares Tendered"
and "Description of Rights to be Tendered" respectively. In such case, new
certificate(s) for the remainder of the Shares or Rights that were evidenced by
your old certificate(s) will be sent to you, unless otherwise provided in the
appropriate box on this Letter of Transmittal, as soon as practicable after the
Expiration Date. All Shares and Rights represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise indicated.
5. Signatures on Letter of Transmittal, Stock Powers and Endorsements. If
this Letter of Transmittal is signed by the registered holder(s) of the Shares
and Rights tendered hereby, the signature(s) must correspond exactly to the
name(s) as written on the face of the certificate(s) without alteration,
enlargement or any change whatsoever.
If any of the Shares or Rights tendered hereby are owned of record by two
or more joint owners, all such owners must sign this Letter of Transmittal.
If any tendered Shares or Rights are registered in different names on
several certificates, it will be necessary to complete, sign and submit as many
separate Letters of Transmittal as there are different registrations of
certificates.
If this Letter of Transmittal or any certificates or stock powers are
signed by a trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or other person acting in a fiduciary or representative
capacity, such person should so indicate when signing, and proper evidence
satisfactory to the Purchaser of such person's authority so to act must be
submitted.
When this Letter of Transmittal is signed by the registered owner(s) of the
Shares or Rights listed and transmitted hereby, no endorsement of certificates
or separate stock powers are required unless payment or Share Certificates
and/or Right Certificates not tendered or purchased are to be issued to a person
other than the registered owner(s). Signatures on such certificates or stock
powers must be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered owner(s) of the Shares or Rights listed, the certificates must be
endorsed or accompanied by appropriate stock powers, in either case signed
exactly as the name(s) of the registered holder(s) appear on the certificates.
Signatures on such certificates or stock powers must be guaranteed by an
Eligible Institution.
6. Stock Transfer Taxes. Except as set forth in this Instruction 6, the
Purchaser will pay or cause to be paid any stock transfer taxes with respect to
the transfer and sale of purchased Shares and Rights to it or its order pursuant
to the Offer. If payment of the purchase price is to be made, or if certificates
for Shares and/or Rights not tendered or purchased are to be registered in the
name of, any person other than the registered holder, or if tendered
certificates are registered in the name of any person other than the person(s)
signing this Letter of Transmittal, the amount of any stock transfer taxes
(whether imposed on the registered holder or such person) payable on account of
the transfer to such person will be deducted from the purchase price unless
satisfactory evidence of the payment of such taxes or exemption therefrom is
submitted.
EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY FOR
TRANSFER TAX STAMPS TO BE AFFIXED TO THE CERTIFICATES LISTED IN THIS LETTER OF
TRANSMITTAL.
7. Special Payment and Delivery Instructions. If a check and/or
certificates for unpurchased Shares or Rights are to be issued in the name of a
person other than the signer of this Letter of Transmittal or if a check is to
be sent and/or such certificates are to be returned to someone other than the
signer of this Letter of Transmittal or to an address other than that shown
above, the appropriate boxes on this Letter of Transmittal should be completed.
Stockholders tendering Shares or Rights by book-entry transfer may request that
Shares and Rights not purchased be credited to such account maintained at a
Book-Entry Transfer Facility as such stockholder may designate hereon. If no
such instructions are given, such Shares and Rights not purchased will be
returned by crediting the account at the Book-Entry Transfer Facility designated
above.
10
<PAGE> 11
8. Requests for Assistance or Additional Copies. Requests for assistance
may be directed to the Dealer Manager or the Information Agent at the addresses
set forth below. Additional copies of the Offer to Purchase, the Supplement,
this Letter of Transmittal, the Notice of Guaranteed Delivery and the Guidelines
for Certification of Taxpayer Identification Number on Substitute Form W-9 may
be obtained from the Dealer Manager or the Information Agent at the address set
forth below or from your broker, dealer, commercial bank or trust company.
9. Waiver of Conditions. The conditions of the Offer may be waived, in
whole or in part, by the Purchaser, in its sole discretion, at any time and from
time to time, in the case of any Shares or Rights tendered.
10. Substitute Form W-9. The tendering stockholder is required to provide
the Depositary with a correct Taxpayer Identification Number ("TIN") on
Substitute From W-9, which is provided under "Important Tax Information" below,
and to certify whether the stockholder is subject to backup withholding of
Federal income tax. If a tendering stockholder is subject to backup withholding,
the stockholder must cross out item (2) of the Certification box of the
Substitute Form W-9. Failure to provide the information on the Substitute Form
W-9 may subject the tendering stockholder to 31% Federal income tax withholding
with respect to any cash payments received pursuant to the Offer and Proposed
Merger. If the tendering stockholder has not been issued a TIN and has applied
for a number or intends to apply for a number in the near future, he or she
should write "Applied For" in the space provided for the TIN in Part I, and sign
and date the Substitute Form W-9. If "Applied For" is written in Part I and the
Depositary is not provided with a TIN within 60 days, the Depositary will
withhold 31% on all payments of the purchase price until a TIN is provided to
the Depositary.
11. Lost, Destroyed or Stolen Certificates. If any certificate(s)
representing Shares or Rights has been lost, destroyed or stolen, the
stockholder should promptly notify the Depositary. The stockholder will then be
instructed as to the steps that must be taken in order to replace the
certificate(s). This Letter of Transmittal and related documents cannot be
processed until the procedures for replacing lost or destroyed certificates have
been followed.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A FACSIMILE THEREOF), PROPERLY
COMPLETED AND DULY EXECUTED, TOGETHER WITH CERTIFICATES OR CONFIRMATION OF
BOOK-ENTRY TRANSFER AND ALL OTHER REQUIRED DOCUMENTS OR THE NOTICE OF GUARANTEED
DELIVERY, MUST BE RECEIVED BY THE DEPOSITARY AT ONE OF ITS ADDRESSES SET FORTH
HEREIN PRIOR TO THE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under Federal income tax law, a stockholder whose tendered Shares are
accepted for payment is required to provide the Depositary with such
stockholder's correct TIN on Substitute Form W-9 below. If such stockholder is
an individual, the TIN is his social security number. If a tendering stockholder
is subject to backup withholding, he must cross out item (2) of the
Certification box on the Substitute Form W-9. If the Depositary is not provided
with the correct TIN, the stockholder may be subject to a $50 penalty imposed by
the Internal Revenue Service. In addition, payments that are made to such
stockholder with respect to Shares and Rights purchased pursuant to the Offer
may be subject to backup withholding.
Certain stockholders (including, among others, all corporations and certain
foreign individuals) are not subject to these backup withholding and reporting
requirements. In order for a foreign individual to qualify as an exempt
recipient, that stockholder must submit to the Depositary a properly completed
Internal Revenue Service Form W-8, signed under penalties of perjury, attesting
to that individual's exempt status. Such statements may be obtained from the
Depositary. Exempt stockholders, other than foreign individuals, should furnish
their TIN, write "Exempt" on the face of the Substitute Form W-9 below, and
sign, date and return the Substitute Form W-9 to the Depositary. See the
enclosed Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9 for additional instructions.
If backup withholding applies, the Depositary is required to withhold 31%
of any payments made to the stockholder. Backup withholding is not an additional
tax. Rather, the tax liability of persons subject to backup withholding will be
reduced by the amount of tax withheld. If withholding results in an overpayment
of taxes, a refund may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup withholding on payments that are made to a stockholder
with respect to Shares or Rights purchased pursuant to the Offer, the
stockholder is required to notify the Depositary of his correct TIN by
completing the form below certifying that the TIN provided on the Substitute
Form W-9 is correct (or that such stockholder is awaiting a TIN).
11
<PAGE> 12
WHAT NUMBER TO GIVE THE DEPOSITARY
The stockholder is required to give the Depositary the social security
number or employer identification number of the record owner of the Shares
and/or Rights. If the Shares and/or Rights are in more than one name or are not
in the name of the actual owner, consult the enclosed Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional guidelines on which number to report. If the tendering stockholder
has not been issued a TIN and has applied for a number or intends to apply for a
number in the near future, he should write "Applied For" in the space provided
for in the TIN in Part I, and sign and date the Substitute Form W-9. If "Applied
For" is written in Part I and the Depositary is not provided with a TIN within
60 days, the Depositary will withhold 31% on all payments of the purchase price
until a TIN is provided to the Depositary.
PAYER'S NAME: CITIBANK, N.A.
<TABLE>
<S> <C> <C>
- ---------------------------------------------------------------------------------------------------
SUBSTITUTE PART I -- PLEASE PROVIDE YOUR TIN IN THE ------------------------
FORM W-9 BOX AT RIGHT AND CERTIFY BY SIGNING AND Social Security Number
DATING BELOW.
DEPARTMENT OF THE OR
TREASURY
INTERNAL REVENUE SERVICE ------------------------------
Employer Identification Number
(If awaiting TIN write
"Applied For")
--------------------------------------------------------------------------
PART II -- For Payees exempt from backup withholding, see the enclosed
Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9 and complete as instructed therein.
CERTIFICATION -- Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct Taxpayer Identification
Number (or a Taxpayer Identification Number has not been issued to me)
and either (a) I have mailed or delivered an application to receive a
Taxpayer Identification Number to the appropriate Internal Revenue
Service ("IRS") or Social Security Administration office or (b) I
intend to mail or deliver an application in the near future. I
understand that if I do not provide a Taxpayer Identification Number
within sixty (60) days, 31% of all reportable payments made to me
PAYER'S REQUEST FOR thereafter will be withheld until I provide a number, and
TAXPAYER (2) I am not subject to backup withholding either because (a) I am exempt
IDENTIFICATION NUMBER from backup withholding, (b) I have not been notified by the IRS that I
(TIN) am subject to backup withholding as a result of a failure to report
all interest or dividends, or (c) the IRS has notified me that I am
no longer subject to backup withholding.
CERTIFICATE INSTRUCTIONS -- You must cross out item (2) above if you have
been notified by the IRS that you are subject to backup withholding
because of underreporting interest or dividends on your tax return.
However, if after being notified by the IRS that you were subject to
backup withholding you received another notification from the IRS that
you are no longer subject to backup withholding, do not cross out item
(2). (Also see instructions in the enclosed Guidelines.)
- ---------------------------------------------------------------------------------------------------
SIGNATURE DATE ,1995
- ---------------------------------------------------------------------------------------------------
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW
THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
12
<PAGE> 13
Questions and requests for assistance or additional copies of the Offer to
Purchase, Supplement, Letter of Transmittal and other tender offer materials may
be directed to the Information Agent or the Dealer Manager as set forth below:
The Information Agent for the Offer is:
MORROW & CO., INC.
909 Third Avenue, 20th Floor
New York, New York 10022
(212) 754-8000 (Call Collect)
(800) 662-5200
The Dealer Manager for the Offer is:
CS FIRST BOSTON CORPORATION
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
(212) 909-2000 (Call Collect)
13
<PAGE> 1
Exhibit (a)(28)
NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED SHARE PURCHASE RIGHTS)
OF
SANTA FE PACIFIC CORPORATION
TO
UP ACQUISITION CORPORATION,
A WHOLLY-OWNED SUBSIDIARY
OF
UNION PACIFIC CORPORATION
(NOT TO BE USED FOR SIGNATURE GUARANTEES)
This revised Notice of Guaranteed Delivery, or one substantially in the
form hereof, must be used to accept the Offer (as defined below) if (i)
certificates ("Share Certificates") representing shares of Common Stock, par
value $1.00 per share (the "Shares"), of Santa Fe Pacific Corporation, a
Delaware corporation (the "Company"), and/or, if applicable, certificates for
the associated preferred share purchase rights (the "Rights") issued pursuant to
the Rights Agreement, dated as of November 28, 1994, between the Company and
First Chicago Trust Company of New York, as Rights Agent (the "Rights
Agreement"), are not immediately available (including, if a Distribution Date
(as defined in the Supplement dated January 18, 1995 (the "Supplement")) has
occurred, because certificates for Rights have not been distributed by the
Company), or (ii) time will not permit all required documents to reach Citibank,
N.A., as Depositary (the "Depositary"), prior to the Expiration Date (as defined
in the Supplement) or (iii) the procedure for delivery by book-entry transfer
cannot be completed on a timely basis. This Notice of Guaranteed Delivery may be
delivered by hand or mail or transmitted by telegram or facsimile transmission
to the Depositary. See Section 3 of the Offer to Purchase dated November 9, 1994
(the "Offer to Purchase") and Section 2 of the Supplement.
The Depositary for the Offer is:
CITIBANK, N.A.
<TABLE>
By Mail: By Facsimile Overnight Express By Hand:
Transmission: Mail Courier:
<S> <C> <C> <C>
Citibank, N.A. (For Eligible Citibank, N.A. Citibank, N.A.
c/o Citicorp Data Institutions Only) c/o Citicorp Data Corporate Trust Window
Distribution, Inc. (201)262-3240 Distribution, Inc. 111 Wall Street, 5th Floor
P.O. Box 1429 404 Sette Drive New York, New York
Paramus, New Jersey 07653 Paramus, New Jersey 07652
</TABLE>
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION OTHER
THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
THIS FORM IS NOT TO BE USED TO GUARANTEE SIGNATURES. IF A SIGNATURE ON A
LETTER OF TRANSMITTAL IS REQUIRED TO BE GUARANTEED BY AN "ELIGIBLE INSTITUTION"
UNDER THE INSTRUCTIONS THERETO, SUCH SIGNATURE GUARANTEE MUST APPEAR IN THE
APPLICABLE SPACE PROVIDED IN THE SIGNATURE BOX ON THE LETTER OF TRANSMITTAL.
<PAGE> 2
LADIES AND GENTLEMEN:
The undersigned hereby tenders to UP Acquisition Corporation, a Utah
corporation and a wholly-owned subsidiary of Union Pacific Corporation, a Utah
corporation, upon the terms and subject to the conditions set forth in the Offer
to Purchase, the Supplement and in the revised Letter of Transmittal (which, as
amended from time to time, together constitute the "Offer"), receipt of which is
hereby acknowledged, the number of Shares and Rights indicated below pursuant to
the guaranteed delivery procedures set forth in Section 3 of the Offer to
Purchase and Section 2 of the Supplement.
Number of Shares:
- ------------------------------------------------------
Number of Rights:
- ------------------------------------------------------
Certificate No(s). (if available)
Name(s) of Record Holder(s)
- -------------------------------------
-------------------------------------
Share Certificates:
-------------------------------------
PLEASE TYPE OR PRINT
- -------------------------------------
Right Certificates:
Address(es)
-------------------------------------
- -------------------------------------
-------------------------------------
Check ONE box if Shares or Rights
will be
ZIP CODE
tendered by book-entry transfer:
Area Code and Tel. No.
----------------------------------------------------------------------
/ / The Depository Trust Company
Signature(s)
-------------------------------------
/ / Midwest Securities Trust Company
-------------------------------------
/ / Philadelphia Depository Trust
Company
Account Number
- -----------------------------------------------------------------------------
Dated
- ------------------------------------- , 1995
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm that is a member of a registered national
securities exchange or of the National Association of Securities Dealers, Inc.
or which is a commercial bank or trust company having an office or correspondent
in the United States, hereby guarantees delivery to the Depositary, at one of
its addresses set forth above, of certificates representing the Shares and/or
Rights tendered hereby in proper form for transfer, or confirmation of
book-entry transfer of such Shares and/or Rights into the Depositary's accounts
at The Depository Trust Company, the Midwest Securities Trust Company or the
Philadelphia Depository Trust Company, in each case with delivery of a properly
completed and duly executed Letter of Transmittal (or facsimile thereof), and
any other required documents, within (a) in the case of Shares, five New York
Stock Exchange, Inc. ("NYSE") trading days after the date of execution of this
Notice of Guaranteed Delivery, or (b) in the case of Rights, a period ending on
the later of (i) five NYSE trading days after the date of execution of this
Notice of Guaranteed Delivery and (ii) five business days after the date on
which the certificates for the Rights are distributed to holders of Shares by
the Company.
The Eligible Institution that completes this form must communicate the
guarantee to the Depositary and must deliver the Letter of Transmittal and the
certificates for Shares and/or Rights to the Depositary within the time period
shown herein. Failure to do so could result in a financial loss to such Eligible
Institution.
<TABLE>
<S> <C>
- --------------------------------------------------------- ---------------------------------------------------------
NAME OF FIRM AUTHORIZED SIGNATURE
- --------------------------------------------------------- ---------------------------------------------------------
ADDRESS TITLE
- --------------------------------------------------------- Name
ZIP CODE PLEASE TYPE OR PRINT
Area Code and Tel. No. Date , 1995
</TABLE>
NOTE: DO NOT SEND CERTIFICATES FOR SHARES OR RIGHTS WITH THIS NOTICE.
CERTIFICATES FOR SHARES OR RIGHTS SHOULD BE SENT WITH YOUR LETTER OF
TRANSMITTAL.
2
<PAGE> 1
Exhibit (a)(29)
[CS FIRST BOSTON LOGO] CS First Boston Corporation
Park Avenue Plaza
New York, New York 10055
Tel: (212) 909-2000
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
(Including the Associated Preferred Share Purchase Rights)
OF
SANTA FE PACIFIC CORPORATION
AT
$18.50 NET PER SHARE
BY
UP ACQUISITION CORPORATION,
A WHOLLY-OWNED SUBSIDIARY OF
UNION PACIFIC CORPORATION
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT
12:00 MIDNIGHT, NEW YORK CITY TIME, ON TUESDAY, FEBRUARY 7, 1995,
UNLESS THE OFFER IS EXTENDED.
January 18, 1995
To Brokers, Dealers, Commercial Banks,
Trust Companies And Other Nominees:
We have been engaged by UP Acquisition Corporation, a Utah corporation (the
"Purchaser") and a wholly-owned subsidiary of Union Pacific Corporation, a Utah
corporation ("Parent"), to act as Dealer Manager in connection with the
Purchaser's offer to purchase all of the outstanding shares of Common Stock, par
value $1.00 per share (the "Shares"), of Santa Fe Pacific Corporation, a
Delaware corporation (the "Company"), including (unless and until the Purchaser
declares that the Rights Condition (as defined in the Supplement dated January
18, 1995 (the "Supplement")) is satisfied) the associated preferred share
purchase rights (the "Rights") issued pursuant to the Rights Agreement, dated as
of November 28, 1994, between the Company and First Chicago Trust Company of New
York, as Rights Agent (the "Rights Agreement"). The Purchaser is now tendering
for all outstanding Shares and has increased the price to be paid in the Offer
to $18.50 per Share, net to the seller in cash, without interest thereon (the
"Offer Price"), upon the terms and subject to the conditions set forth in the
Offer to Purchase dated November 9, 1994, the Supplement and in the revised
Letter of Transmittal (which, as amended from time to time, together constitute
the "Offer").
If the Purchaser declares that the Rights Condition (as defined in the
Supplement) is satisfied, the Purchaser will not require delivery of the Rights.
Unless and until the Purchaser declares that the Rights Condition is satisfied,
holders of Shares will be required to tender one Right for each Share tendered
in order to effect a valid tender of such Share. If Right Certificates (as
defined in the Supplement) have been distributed to holders of Shares prior to
the date of tender pursuant to the Offer, Right Certificates representing a
number of Rights equal to the number of Shares being tendered must be delivered
to the Depositary in order for such Shares to be validly tendered. If Right
Certificates have not been distributed prior
<PAGE> 2
to the time Shares are tendered pursuant to the Offer, a tender of Shares
without Rights constitutes an agreement by the tendering stockholder to deliver
Right Certificates representing a number of Rights equal to the number of Shares
tendered pursuant to the Offer to the Depositary within five New York Stock
Exchange, Inc. ("NYSE") trading days after the date Right Certificates are
distributed. The Purchaser reserves the right to require that the Depositary
receive such Right Certificates prior to accepting Shares for payment. Payment
for Shares tendered and purchased pursuant to the Offer will be made only after
timely receipt by the Depositary of, among other things, Right Certificates, if
such certificates have been distributed to holders of Shares. The Purchaser will
not pay any additional consideration for the Rights tendered pursuant to the
Offer.
Holders of Shares and Rights whose certificates evidencing Shares and, if
applicable, Right Certificates, are not immediately available (including if
Right Certificates have not yet been distributed) or who cannot deliver
confirmation of the book-entry transfer of their Shares into the Depositary's
account at a Book-Entry Transfer Facility ("Book-Entry Confirmation") and all
other documents required hereby to the Depositary on or prior to the Expiration
Date (as defined in Section 1 of the Supplement) must tender their Shares and
Rights according to the guaranteed delivery procedures set forth in Section 3 of
the Offer to Purchase, as supplemented by Section 2 of the Supplement. See
Instruction 2 of the revised Letter of Transmittal. Delivery of documents to a
Book-Entry Transfer Facility does not constitute delivery to the Depositary.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY
TENDERED PRIOR TO THE EXPIRATION OF THE OFFER AND NOT WITHDRAWN AT LEAST A
MAJORITY OF THE SHARES OUTSTANDING ON A FULLY DILUTED BASIS AND (2) THE COMPANY
HAVING ENTERED INTO A DEFINITIVE MERGER AGREEMENT WITH PARENT AND THE PURCHASER
TO PROVIDE FOR THE ACQUISITION OF THE COMPANY PURSUANT TO THE OFFER AND THE
PROPOSED MERGER.
For your information and for forwarding to your clients for whom you hold
Shares registered in your name or in the name of your nominee, or who hold
Shares registered in their own names, we are enclosing the following documents:
1. Supplement dated January 18, 1995;
2. Revised Letter of Transmittal to be used by holders of Shares and Rights
in accepting the Offer and tendering Shares and/or Rights;
3. Revised letter which may be sent to your clients for whose account you
hold Shares and/or Rights registered in your name or in the name of your
nominees, with space provided for obtaining such clients' instructions
with regard to the Offer;
4. Revised Notice of Guaranteed Delivery to be used to accept the Offer if
certificates for Shares and/or Rights are not immediately available
(including if certificates for Rights have not yet been distributed) or
time will not permit all required documents to reach the Depositary by
the Expiration Date (as defined in the Supplement) or if the procedure
for book-entry transfer cannot be completed on a timely basis;
5. Guidelines of the Internal Revenue Service for Certification of Taxpayer
Identification Number on Substitute Form W-9; and
6. Return envelope addressed to the Depositary.
Upon the terms and subject to the conditions of the Offer (including, if
the Offer is extended or amended, the terms and conditions of any such extension
or amendment), the Purchaser will accept for payment and pay for all of the
Shares (and, if applicable, the Rights) which are validly tendered prior to the
Expiration Date and not theretofore properly withdrawn when, as and if the
Purchaser gives oral or written notice to the Depositary of the Purchaser's
acceptance of such Shares and Rights for payment pursuant to the Offer. Payment
for Shares and Rights purchased pursuant to the Offer will in all cases be made
only after timely receipt by the Depositary of certificates for such Shares,
and, if applicable, certificates for the Rights or timely confirmation of a
book-entry transfer of such Shares and/or Rights into the Depositary's account
at The Depository Trust Company, the Midwest Securities Company or the
Philadelphia Depository Trust Company,
2
<PAGE> 3
pursuant to the procedures described in Section 3 of the Offer to Purchase, and
Section 2 of the Supplement, a properly completed and duly executed Letter of
Transmittal (or manually signed facsimile thereof) or an Agent's Message in
connection with a book-entry transfer, and all other documents required by the
Letter of Transmittal.
The Purchaser will not pay any fees or commissions to any broker or dealer
or other person (other than the Dealer Manager) in connection with the
solicitation of tenders of Shares and Rights pursuant to the Offer. The
Purchaser will, however, upon request, reimburse you for customary mailing and
handling expenses incurred by you in forwarding the enclosed materials to your
clients.
The Purchaser will pay or cause to be paid any transfer taxes payable on
the transfer of Shares and Rights to it, except as otherwise provided in
Instruction 6 of the enclosed Letter of Transmittal.
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS
PROMPTLY AS POSSIBLE. THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00
MIDNIGHT, NEW YORK CITY TIME, ON TUESDAY, FEBRUARY 7, 1995, UNLESS THE OFFER IS
EXTENDED.
In order to take advantage of the Offer, a duly executed and properly
completed Letter of Transmittal (or facsimile thereof), with any required
signature guarantees and any other required documents, should be sent to the
Depositary, and certificates representing the tendered Shares and/or Rights
should be delivered or such Shares and/or Rights should be tendered by
book-entry transfer, all in accordance with the Instructions set forth in the
revised Letter of Transmittal, the Offer to Purchase and the Supplement.
If holders of Shares and/or Rights wish to tender, but it is impracticable
for them to forward their certificates or other required documents prior to the
expiration of the Offer, a tender may be effected by following the guaranteed
delivery procedures specified under Section 3 of the Offer to Purchase and
Section 2 of the Supplement.
Any inquiries you may have with respect to the Offer should be addressed to
the Dealer Manager or the Information Agent at their respective addresses and
telephone numbers set forth on the back cover page of the Offer to Purchase or
the Supplement.
Additional copies of the enclosed materials may be obtained from the
undersigned, at CS First Boston Corporation, telephone (212) 909-2000 (Collect),
or by calling the Information Agent, Morrow & Co., Inc., at (212) 754-8000
(Collect), or from brokers, dealers, commercial banks or trust companies.
Very truly yours,
CS FIRST BOSTON CORPORATION
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY PERSON AS AN AGENT OF PARENT, THE PURCHASER, THE DEPOSITARY, THE
INFORMATION AGENT OR THE DEALER MANAGER, OR ANY AFFILIATE OF ANY OF THE
FOREGOING, OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY
STATEMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE
DOCUMENTS ENCLOSED AND THE STATEMENTS CONTAINED THEREIN.
3
<PAGE> 1
Exhibit (a)(30)
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
(Including the Associated Preferred Share Purchase Rights)
OF
SANTA FE PACIFIC CORPORATION
AT
$18.50 NET PER SHARE
BY
UP ACQUISITION CORPORATION,
A WHOLLY-OWNED SUBSIDIARY OF
UNION PACIFIC CORPORATION
To Our Clients: January 18, 1995
Enclosed for your consideration is the Supplement dated January 18, 1995
(the "Supplement") to the Offer to Purchase, dated November 9, 1994 (the "Offer
to Purchase") and the revised Letter of Transmittal (which, as amended from time
to time, together constitute the "Offer") relating to an offer by UP Acquisition
Corporation, a Utah corporation (the "Purchaser") and a wholly-owned subsidiary
of Union Pacific Corporation, a Utah corporation ("Parent"), to purchase all of
the outstanding shares of Common Stock, par value $1.00 per share (the
"Shares"), of Santa Fe Pacific Corporation, a Delaware corporation (the
"Company"), including (unless and until the Purchaser declares that the Rights
Condition (as defined in the Supplement) is satisfied) the associated preferred
share purchase rights (the "Rights") issued pursuant to the Rights Agreement,
dated as of November 28, 1994, between the Company and First Chicago Trust
Company of New York, as Rights Agent. The Purchaser is now tendering for all
outstanding Shares and has increased the price to be paid in the Offer to $18.50
per Share, net to the seller in cash, without interest thereon (the "Offer
Price") upon the terms and subject to the conditions set forth in the Offer to
Purchase, the Supplement and the revised Letter of Transmittal.
If the Purchaser declares that the Rights Condition is satisfied, the
Purchaser will not require delivery of the Rights. Unless and until the
Purchaser declares that the Rights Condition is satisfied, holders of Shares
will be required to tender one Right for each Share tendered in order to effect
a valid tender of such Share. If Right Certificates (as defined in the
Supplement) have been distributed to holders of Shares prior to the date of
tender pursuant to the Offer, Right Certificates representing a number of Rights
equal to the number of Shares being tendered must be delivered to the Depositary
in order for such Shares to be validly tendered. If Right Certificates have not
been distributed prior to the time Shares are tendered pursuant to the Offer, a
tender of Shares without Rights constitutes an agreement by the tendering
stockholder to deliver Right Certificates representing a number of Rights equal
to the number of Shares tendered pursuant to the Offer to the Depositary within
five New York Stock Exchange, Inc. ("NYSE") trading days after the date Right
Certificates are distributed. The Purchaser reserves the right to require that
the Depositary receive such Right Certificates prior to accepting Shares for
payment. Payment for Shares tendered and purchased pursuant to the Offer will be
made only after timely receipt by the Depositary of, among other things, Right
Certificates, if such certificates have been distributed to holders of Shares.
The Purchaser will not pay any additional consideration for the Rights tendered
pursuant to the Offer.
Holders whose certificates for Shares and, if applicable, Right
Certificates, are not immediately available (including, if Right Certificates
have not yet been distributed) or who cannot deliver confirmation of the
<PAGE> 2
book-entry transfer of their Shares and Rights into the Depositary's account at
a Book-Entry Transfer Facility ("Book-Entry Confirmation") and all other
documents required hereby to the Depositary on or prior to the Expiration Date
(as defined in Section 1 of the Supplement) must tender their Shares and Rights
according to the guaranteed delivery procedures set forth in Section 3 of the
Offer to Purchase, as supplemented by Section 2 of the Supplement. See
Instruction 2 of the revised Letter of Transmittal. Delivery of documents to a
Book-Entry Transfer Facility does not constitute delivery to the Depositary.
A tender for such Shares and Rights can be made only by us as the holder of
record and pursuant to your instructions. THE LETTER OF TRANSMITTAL IS FURNISHED
TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER SHARES OR
RIGHTS HELD BY US FOR YOUR ACCOUNT.
We request instructions as to whether you wish to tender any or all of such
Shares and Rights held by us for your account, pursuant to the terms and
conditions set forth in the Offer.
Your attention is invited to the following:
1. The tender price has been increased to $18.50 per Share, including the
associated Rights, net to the seller in cash without interest.
2. The Offer and withdrawal rights will expire at 12:00 midnight, New York
City time, on Tuesday, February 7, 1995, unless the Offer is extended.
3. The Offer is being made for all Shares.
4. The Offer is conditioned upon, among other things, (1) there being
validly tendered prior to the expiration of the Offer and not withdrawn at least
a majority of the Shares outstanding on a fully diluted basis and (2) the
Company having entered into a definitive merger agreement with Parent and the
Purchaser to provide for the acquisition of the Company pursuant to the Offer
and the proposed merger.
5. Stockholders who tender Shares and/or Rights will not be obligated to
pay brokerage commissions, solicitation fees or, except as set forth in
Instruction 6 of the Letter of Transmittal, transfer taxes on the purchase of
Shares and/or Rights by the Purchaser pursuant to the Offer.
The Purchaser is not aware of any state where the making of the Offer is
prohibited by administrative or judicial action pursuant to any valid state
statute. If the Purchaser becomes aware of any valid state statute prohibiting
the making of the Offer or the acceptance of Shares or Rights pursuant thereto,
the Purchaser will make a good faith effort to comply with any such state
statute. If, after such good faith effort, the Purchaser cannot comply with any
such state statute, the Offer will not be made to (nor will tenders be accepted
from or on behalf of) the holders of Shares or Rights in such state. In any
jurisdiction where the securities, blue sky or other laws require the Offer to
be made by a licensed broker or dealer, the Offer will be deemed to be made on
behalf of the Purchaser by the Dealer Manager or one or more registered brokers
or dealers licensed under the laws of such jurisdiction.
If you wish to have us tender any or all of your Shares and Rights, please
complete, sign and return to us the form set forth below. An envelope to return
your instructions to us is enclosed. Your instructions to us should be forwarded
in ample time to permit us to submit a tender on your behalf prior to the
expiration of the Offer. If you authorize the tender of your Shares and Rights,
all such Shares and Rights will be tendered unless otherwise specified on the
instruction form set forth on the opposite page.
2
<PAGE> 3
INSTRUCTIONS WITH RESPECT TO THE OFFER
TO PURCHASE FOR CASH SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED SHARE PURCHASE RIGHTS)
OF SANTA FE PACIFIC CORPORATION
The undersigned acknowledge(s) receipt of your letter and the enclosed
Supplement dated January 18, 1995, and the revised Letter of Transmittal (which,
together as amended from time to time constitute the "Offer") relating to the
offer by UP Acquisition Corporation, a Utah corporation (the "Purchaser"), to
purchase all the outstanding shares of Common Stock, par value $1.00 per share
(the "Shares"), of Santa Fe Pacific Corporation, a Delaware corporation (the
"Company"), including, (unless and until the Purchaser declares that the Rights
Condition (as defined in the Supplement) is satisfied) the associated preferred
share purchase rights (the "Rights") issued pursuant to the Rights Agreement,
dated as of November 28, 1994, between the Company and First Chicago Trust
Company of New York, as Rights Agent (the "Rights Agreement").
This will instruct you to tender to the Purchaser the number of Shares and
Rights indicated below (or if no number is indicated below, all Shares and
Rights) held by you for the account of the undersigned, on the terms and subject
to the conditions set forth in the Offer.
- --------------------------------------- SIGN HERE
NUMBER OF SHARES AND RIGHTS TO BE
TENDERED:*
------------------------------------
SHARES AND RIGHTS: ------------------------------------
- --------------------------------------- Signature(s)
Account Number:
----------------------- ------------------------------------
Dated:
------------------------- , 1995 ------------------------------------
Please print name(s) and address(es)
here
------------------------------------
Area Code and Telephone Number
------------------------------------
Tax Identification or Social
Security Number(s)
- ---------------
* Unless otherwise indicated, it will be assumed that all of your Shares and
Rights held by us for your account are to be tendered.
3
<PAGE> 1
Exhibit (a)(31)
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
(Including the Associated Preferred Share Purchase Rights)
OF
SANTA FE PACIFIC CORPORATION
AT
$18.50 NET PER SHARE
BY
UP ACQUISITION CORPORATION,
A WHOLLY-OWNED SUBSIDIARY OF
UNION PACIFIC CORPORATION
January 18, 1995
To Participants in the Dividend Reinvestment Plan of Santa Fe Pacific
Corporation:
Enclosed for your consideration is the Supplement dated January 18, 1995 to
the Offer to Purchase dated November 9, 1994 and the revised Letter of
Transmittal (which, together as amended from time to time constitute the
"Offer") relating to the offer by UP Acquisition Corporation, a Utah corporation
(the "Purchaser") and a wholly-owned subsidiary of Union Pacific Corporation, a
Utah corporation ("Parent"), to purchase all of the outstanding shares of Common
Stock, par value $1.00 per share (the "Shares"), of Santa Fe Pacific
Corporation, a Delaware corporation (the "Company"), including (unless and until
the Purchaser declares that the Rights Condition (as defined in the Supplement)
is satisfied) the associated preferred share purchase rights (the "Rights")
issued pursuant to the Rights Agreement, dated as of November 28, 1994, between
the Company and First Chicago Trust Company of New York, as Rights Agent. The
Purchaser is now tendering for all outstanding Shares and has increased the
price to be paid in the Offer to $18.50 per Share, net to the seller in cash,
without interest thereon (the "Offer Price") upon the terms and subject to the
conditions set forth in the Offer.
If the Purchaser declares that the Rights Condition (as defined in the
Supplement) is satisfied, the Purchaser will not require delivery of the Rights.
Unless and until the Purchaser declares that the Rights Condition is satisfied,
holders of Shares will be required to tender one Right for each Share tendered
in order to effect a valid tender of such Share. If Right Certificates (as
defined in the Supplement) have been distributed to holders of Shares prior to
the date of tender pursuant to the Offer, Right Certificates representing a
number of Rights equal to the number of Shares being tendered must be delivered
to the Depositary in order for such Shares to be validly tendered. If Right
Certificates have not been distributed prior to the time Shares are tendered
pursuant to the Offer, a tender of Shares without Rights constitutes an
agreement by the tendering stockholder to deliver Right Certificates
representing a number of Rights equal to the number of Shares tendered pursuant
to the Offer to the Depositary within five New York Stock Exchange, Inc. (the
"NYSE") trading days after the date Right Certificates are distributed. The
Purchaser reserves the right to require that the Depositary receive such Right
Certificates prior to accepting Shares for payment. Payment for Shares tendered
and purchased pursuant to the Offer will be made only after timely receipt by
the Depositary of, among other things, Right Certificates, if such certificates
have been distributed to holders of Shares. The Purchaser will not pay any
additional consideration for the Rights tendered pursuant to the Offer.
<PAGE> 2
Stockholders whose Share Certificates and, if applicable, Right
Certificates, are not immediately available (including, if Right Certificates
have not yet been distributed) or who cannot deliver confirmation of the
book-entry transfer of their Shares and Rights into the Depositary's account at
a Book-Entry Transfer Facility ("Book-Entry Confirmation") and all other
documents required hereby to the Depositary on or prior to the Expiration Date
(as defined in Section 1 of the Supplement) must tender their Shares and Rights
according to the guaranteed delivery procedures set forth in Section 3 of the
Offer to Purchase, as supplemented by Section 2 of the Supplement. See
Instruction 2 of the revised Letter of Transmittal. Delivery of documents to a
Book-Entry Transfer Facility does not constitute delivery to the Depositary.
Our nominee is the holder of record of Shares and Rights held for your
account as a participant in the Dividend Reinvestment Plan of the Company (the
"Plan"). A tender of such Shares and Rights can be made only by us through our
nominee as the holder of record and pursuant to your instructions. The revised
Letter of Transmittal is furnished to you for your information only and cannot
be used by you to tender Shares and Rights held in your Plan account.
We request instructions as to whether you wish to have us instruct our
nominee to tender on your behalf any or all of the Shares and Rights held in
your Plan account, upon the terms and subject to the conditions set forth in the
Offer.
Your attention is directed to the following:
1. The tender price has been increased to $18.50 per Share, net to the
seller in cash without interest.
2. The Offer and withdrawal rights will expire at 12:00 midnight, New York
City time, on Tuesday, February 7, 1995, unless the Offer is extended.
3. The Offer is now being made for all Shares.
4. The Offer is now conditioned upon, among other things, (1) there being
validly tendered prior to the expiration of the Offer and not withdrawn at least
a majority of the Shares outstanding on a fully diluted basis and (2) the
Company having entered into a definitive merger agreement with Parent and the
Purchaser to provide for the acquisition of the Company pursuant to the Offer
and the proposed merger.
5. Holders who tender Shares and/or Rights will not be obligated to pay
brokerage commissions, solicitation fees or, except as set forth in Instruction
6 of the Letter of Transmittal, transfer taxes on the purchase of Shares and/or
Rights by the Purchaser pursuant to the Offer.
The Offer is made solely by the Offer to Purchase, the Supplement and the
Letter of Transmittal and is being made to all holders of Shares. The Purchaser
is not aware of any state where the making of the Offer is prohibited by
administrative or judicial action pursuant to any valid state statute. If the
Purchaser becomes aware of any valid state statute prohibiting the making of the
Offer or the acceptance of Shares and Rights pursuant thereto, the Purchaser
will make a good faith effort to comply with such state statute. If, after such
good faith effort, the Purchaser cannot comply with any such state statute, the
Offer will not be made to (nor will tenders be accepted from or on behalf of)
the holders of Shares and Rights in such state. In any jurisdiction where the
securities, blue sky or other laws require the Offer to be made by a licensed
broker or dealer, the Offer will be deemed to be made on behalf of the Purchaser
by the Dealer Manager or one or more registered brokers or dealers licensed
under the laws of such jurisdiction.
Very truly yours,
First Chicago Trust Company of New
York, AS
DIVIDEND REINVESTMENT AGENT
2
<PAGE> 3
PAYER'S NAME:
------------------------
<TABLE>
<S> <C> <C>
- ---------------------------------------------------------------------------------------------------
SUBSTITUTE PART I -- Taxpayer Identification ------------------------
FORM W-9 Number -- For all accounts, enter taxpayer Social Security Number
identification number in the box at right.
DEPARTMENT OF THE For most individuals, this is your social OR
TREASURY (security number. If you do not have a -----------------------
INTERNAL REVENUE number, see Obtaining a Number in the Employer Identification
SERVICE enclosed Guidelines.) Certify by signing Number
and dating below. Note: If the account is
in more than one name, see the chart in the (If awaiting TIN write
enclosed Guidelines to determine which "Applied For")
number to give the payer.
--------------------------------------------------------------------------
Payer's Request for PART II -- For Payees Exempt From Backup Withholding, see the enclosed
Taxpayer Guidelines and complete as instructed therein.
Identification
Number(TIN)
- ---------------------------------------------------------------------------------------------------
CERTIFICATION -- Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct Taxpayer Identification Number (or I am waiting
for a number to be issued to me) and
(2) I am not subject to backup withholding either because I have not been notified by the Internal
Revenue Service (the "IRS") that I am subject to backup withholding as a result of failure to
report all interest or dividends, or the IRS has notified me that I am no longer subject to
backup withholding.
CERTIFICATE INSTRUCTIONS -- You must cross out item (2) above if you have been notified by the IRS
that you are subject to backup withholding because of underreporting interest or dividends on
your tax return. However, if after being notified by the IRS that you were subject to backup
withholding you received another notification from the IRS that you are no longer subject to
backup withholding, do not cross out item (2). (Also see instructions in the enclosed
Guidelines.)
- ---------------------------------------------------------------------------------------------------
SIGNATURE DATE , 1995
- ---------------------------------------------------------------------------------------------------
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW
THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
3
<PAGE> 4
INSTRUCTIONS WITH RESPECT TO
THE OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED SHARE PURCHASE RIGHTS)
OF
SANTA FE PACIFIC CORPORATION
BY
UP ACQUISITION CORPORATION
The undersigned acknowledge(s) receipt of your letter and the enclosed
Supplement, dated January 18, 1995, to the Offer to Purchase dated November 9,
1994, and the revised Letter of Transmittal (which, together as amended from
time to time constitute the "Offer") relating to the offer by UP Acquisition
Corporation, a Utah corporation (the "Purchaser"), to purchase all the
outstanding shares of Common Stock, par value $1.00 per share (the "Shares"), of
Santa Fe Pacific Corporation, a Delaware corporation, (the "Company"), including
(unless and until the Purchaser declares that the Rights Condition (as defined
in the Supplement) is satisfied) the associated preferred share purchase rights
(the "Rights") issued pursuant to the Rights Agreement, dated as of November 28,
1994, between the Company and First Chicago Trust Company of New York, as Rights
Agent (the "Rights Agreement"). The undersigned understand(s) that the Offer
applies to Shares and Rights allocated to the account of the undersigned in the
Company's Dividend Reinvestment Plan (the "Plan").
This will instruct you, as Dividend Reinvestment Agent, to instruct your
nominee to tender the number of Shares and Rights indicated below (or, if no
number is indicated below, all Shares and Rights) that are held for the Plan
account of the undersigned, upon the terms and subject to the conditions set
forth in the Offer.
Number of Shares and Rights to be
Tendered:
Shares and Rights*:
SIGN HERE
------------------------------------
------------------------------------
Signature(s)
------------------------------------
------------------------------------
Please type or print address
------------------------------------
Area Code and Telephone Number
------------------------------------
Taxpayer Identification or
Social Security Number
Dated: , 1995
- ---------------
* Unless otherwise indicated, it will be assumed that all Shares and Rights held
by us for your account are to be tendered.
4
<PAGE> 1
Exhibit (a)(32)
WITHDRAWAL OF SHARES
OF COMMON STOCK
OF
SANTA FE PACIFIC CORPORATION
TENDERED PURSUANT TO THE JOINT TENDER OFFER BY
BURLINGTON NORTHERN INC.
AND
SANTA FE PACIFIC CORPORATION
To holders of Shares of Common Stock of
Santa Fe Pacific Corporation
who have tendered Shares pursuant to the
Joint Tender Offer by Burlington Northern Inc
and Santa Fe Pacific Corporation:
UP Acquisition Corporation (the "Purchaser") has amended the terms of its
tender offer (the "UP Offer") for shares of Common Stock, par value $1.00 per
share (the "Shares"), of Santa Fe Pacific Corporation (the "Company") to provide
for the purchase of all outstanding Shares at a price of $18.50 net per Share in
cash. The UP Offer will expire at 12:00 Midnight, New York City time, on
Tuesday, February 7, 1995, unless the UP Offer is extended. If you have
previously tendered Shares pursuant to the joint tender offer for up to
63,000,000 Shares by Burlington Northern Inc and Santa Fe Pacific Corporation
(the "Joint Offer"), such Shares may be withdrawn prior to the expiration of the
Joint Offer if the applicable procedures set forth in Section 4 of the Offer to
Purchase, dated December 23, 1994 (the "Santa Fe/BN Joint Offer to Purchase")
are followed. Section 4 of the Joint Offer to Purchase provides instructions as
to the contents of, and procedures for delivery of, a notice of withdrawal of
Shares.
For the convenience of holders of Shares, the Purchaser has provided the
following form of "Notice of Withdrawal" which if properly completed and timely
delivered to First Chicago Trust Company of New York, the Depositary for the
Joint Offer, should enable holders of Shares to withdraw Shares tendered
pursuant to the Joint Offer. The following form or a written, telegraphic, telex
or facsimile notice of withdrawal must be timely received by First Chicago Trust
Company of New York. Shareholders of Santa Fe Pacific Corporation who desire
assistance in withdrawing Shares tendered pursuant to the Joint Offer may
contact Morrow & Co, Inc., the Information Agent for the UP Offer, at its
address and telephone number set forth below.
The Information Agent for the UP Offer is:
Morrow & Co., Inc.
909 Third Avenue, 20th Floor 39 South LaSalle Street
New York, New York 10022 Chicago, Illinois 60603
(212) 754-8000 (312) 444-1150
(Call Collect) (Call Collect)
or
Call Toll Free 1-800-662-5200
<PAGE> 2
NOTICE OF WITHDRAWAL
First Chicago Trust Company of New York
<TABLE>
<S> <C> <C>
By Mail: By Facsimile Transmission: By Hand:
(For Eligible Institution Only)
Tenders & Exchange Tenders & Exchange
P.O. Box 2564 (201) 222-4720 14 Wall Street
Suite 4660 SFP (201) 222-4721 Suite 4680 SFP
Jersey City, NJ 07303-2564 8th Floor
New York, NY 10005
Confirm Facsimile by Telephone
(for Confirmation Only)
(201) 222-4707
</TABLE>
Gentlemen:
With respect to the joint tender offer commenced by Burlington Northern
Inc. and Santa Fe Pacific Corporation, the undersigned hereby withdraws the
shares of Common Stock, par value $1.00 per share (including the associated
preferred share purchase rights issued pursuant to the Rights Agreement, dated
as of November 28, 1994 between Santa Fe Pacific Corporation and First Chicago
Trust Company of New York, as Rights Agent) (collectively, the "Shares"), of
Santa Fe Pacific Corporation described below.
DESCRIPTION OF SHARES WITHDRAWN
Name(s) of tendering shareholder(s)
---------------------------------------------
Name(s) of registered holder(s) (if different)
----------------------------------
Number of Shares withdrawn
------------------------------------------------------
FURTHER DESCRIPTION OF WITHDRAWN SHARES
A. (To be completed only if certificates have been delivered or otherwise
identified to First Chicago Trust Company of New York, Depositary)
Certificate serial number(s)
----------------------------------------------------
B. (To be completed for Shares delivered by book-entry transfer)
Name of Book-Entry Transfer
Facility
------------------------------------------------------------------------
Name of account at Book-Entry Transfer
Facility
------------------------------------------------------------------------
Account number of account at Book-Entry Transfer
Facility
------------------------------------------------------------------------
2
<PAGE> 3
STOCKHOLDERS SIGN HERE
Must be signed by registered holder(s) as name(s) appear(s) on stock
certificate(s) or by person(s) authorized to become registered holder(s) by
certificates and documents previously transmitted or transmitted herewith. If
signature is by a trustee, executor, administrator, guardian, officer or other
person acting in a fiduciary or representative capacity, please set forth full
title.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
Dated:
--------, 1995
Name(s)
------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Please Print
Capacity
-----------------------------------------------------------------------
Address
------------------------------------------------------------------------
------------------------------------------------------------------------
(including zip code)
GUARANTEE OF SIGNATURES
(TO BE COMPLETED ONLY IF
ITEM A ABOVE APPLICABLE)
Authorized Signature
-----------------------------------------------------------
Name
---------------------------------------------------------------------------
Title
--------------------------------------------------------------------------
Address
------------------------------------------------------------------------
Name of Firm
-------------------------------------------------------------------
Dated:
--------, 1995
3
<PAGE> 1
Exhibit (a)(33)
UNION PACIFIC
CORPORATION NEWS RELEASE
Contact: 610-861-3382
Gary F. Schuster
Vice President - Corporate Relations
Martin Tower
Eighth and Eaton Avenues
Bethlehem, PA 18018
FOR IMMEDIATE RELEASE
UNION PACIFIC INCREASES PRICE FOR SANTA FE
TO $18.50 PER SHARE
- - - - - - - - - - - - - -
SEEKS TO ACQUIRE 100% OF SANTA FE SHARES
FOR CASH IN TENDER OFFER
- - - - - - - - - - - - - -
BETHLEHEM, PA, JANUARY 17, 1995 -- Union Pacific Corporation (NYSE: UNP)
announced today that it has revised its proposal to acquire Santa Fe Pacific
Corporation (NYSE: SFX) to increase the price to $18.50 per common share in cash
and to seek to acquire 100% of Santa Fe's outstanding shares in the tender
offer. The revised offer values Santa Fe at $3.6 billion.
The terms of Union Pacific's revised proposal are described in a
January 17, 1995 letter from Drew Lewis, Chairman and CEO of Union Pacific, to
Robert D. Krebs, Chairman, President and Chief Executive Officer of Santa Fe,
the full text of which is attached.
Union Pacific's revised tender offer is subject, among other things, to
termination of Santa Fe's merger agreement with Burlington Northern in
accordance with the terms of such
<PAGE> 2
-2-
agreement, the shareholders of Santa Fe not having approved the merger
agreement with Burlington Northern, at least a majority of the Santa Fe shares
being validly tendered and not withdrawn prior to expiration of the offer, the
poison pill rights issued by Santa Fe being redeemed by Santa Fe or the rights
being otherwise inapplicable to the tender offer and proposed merger, and the
absence of any judicial determination invalidating, modifying or imposing
limitations on the ICC's approval regarding Union Pacific's use of a voting
trust.
If less than 90% of Santa Fe's outstanding shares are tendered, the
back-end merger of Union Pacific and Santa Fe, by which Union Pacific would
acquire the remaining Santa Fe shares, would be subject, among other things, to
the approval of Santa Fe shareholders.
#
<PAGE> 3
[UNION PACIFIC CORPORATION LETTERHEAD]
January 17, 1995
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, IL 60173
Dear Rob:
I am writing to inform you that Union Pacific has revised its
acquisition proposal to increase the price to $18.50 per share in cash and to
seek to acquire 100% of Santa Fe's outstanding shares in the tender offer.
By using our Interstate Commerce Commission approved voting trust, your
shareholders would receive immediate payment of the entire purchase price
in our transaction, without bearing any risk relating to ICC approval of our
combination with Sante Fe. By contrast, the new, leveraged Burlington Northern
transaction would require a delay of up to several years for payment of two-
thirds of the purchase price to Santa Fe shareholders, and would require your
shareholders to bear the risk of ICC approval.
In addition to the all-cash advantage of our offer, we believe our
transaction is superior to the Burlington Northern acquisition when one
discounts BN's purchase price for the time delay in payment, the ICC risk of
non-consummation of the BN transaction and the uncertain value of the BN stock
to be received.
Our preference remains to negotiate a merger agreement with Santa Fe.
As your own advisors stated, we were very close to completing negotiation of a
merger agreement before you announced your new transaction with Burlington
Northern. We should be able to conclude our negotiations very quickly in light
of our revised offer. We continue to believe it is a violation of your Board's
fiduciary duties for Santa Fe to resist negotiating a transaction with Union
Pacific.
<PAGE> 4
Mr. Robert D. Krebs
Page 2
January 17, 1995
If you refuse to negotiate with us, we would be prepared to purchase
shares in our tender offer without a merger agreement, provided that your
shareholders tender at least 90% of Santa Fe's outstanding shares and other
impediments such as the rights plan are eliminated. In order to complete the
acquisition on a unilateral basis, we would first ask the ICC to approve an
amendment to our voting trust agreement that would enable the trustee to cause
Santa Fe, following the acquisition of Santa Fe shares, to agree to cooperate
with us in obtaining ICC approval of a Sante Fe/Union Pacific combination. We
would seek ICC approval of the amended voting trust agreement once Santa Fe
shareholders vote to disapprove the Burlington northern merger.
Our offer, including the conditions to our transaction, remains
unchanged in all other material respects. Given your rejection of our
alternative $20 all-stock proposal made several months ago, we confirm our
withdrawal of such alternative proposal.
Sincerely,
/s/ Drew
DL/ss
cc: Board of Directors
Santa Fe Pacific Corporation
<PAGE> 1
Exhibit (g)(11)
SPECIAL MEETING OF STOCKHOLDERS
OF
SANTA FE PACIFIC CORPORATION
------------------------------------
SECOND SUPPLEMENT TO PROXY STATEMENT OF
UNION PACIFIC CORPORATION
------------------------------------
SOLICITATION OF PROXIES
IN OPPOSITION TO THE PROPOSED MERGER OF
SANTA FE PACIFIC CORPORATION AND BURLINGTON NORTHERN INC.
This Second Proxy Statement Supplement (the "Second Supplement") is
furnished by Union Pacific Corporation, a Utah corporation ("Union Pacific"), in
connection with its solicitation of proxies to be used at a special meeting of
stockholders of Santa Fe Pacific Corporation, a Delaware corporation ("Santa
Fe"), and at any adjournments, postponements or reschedulings thereof (the
"Special Meeting"). Union Pacific is soliciting proxies from stockholders of
Santa Fe to vote against Santa Fe's proposal to merge Santa Fe with and into
Burlington Northern Inc., a Delaware corporation ("BN") (such proposed merger,
the "Santa Fe/BN Merger"). Santa Fe has publicly announced that the Special
Meeting, which Santa Fe previously has postponed four times, is now scheduled to
be held on Tuesday, February 7, 1995, at 3:00 p.m., Chicago time, at the
Arlington Park Hilton Conference Center, 3400 W. Euclid Ave., Arlington Heights,
Illinois, and the record date for determining those stockholders of Santa Fe who
will be entitled to vote at the Special Meeting is December 27, 1994. This
Second Supplement amends and modifies, and should be read in conjunction with,
Union Pacific's Proxy Statement, dated October 28, 1994 (the "Union Pacific
Proxy Statement"), as supplemented by the Supplement dated November 9, 1994 (the
"First Supplement"). Capitalized terms used herein and not otherwise defined
herein shall have the respective meanings assigned to such terms in the Union
Pacific Proxy Statement, as supplemented by the First Supplement. Copies of the
Union Pacific Proxy Statement and First Supplement are being mailed, together
with this Second Supplement, to stockholders who were not previously furnished
with the Union Pacific Proxy Statement and First Supplement. Additional copies
of the Union Pacific Proxy Statement and First Supplement may be obtained
without charge by contacting Morrow & Co., Inc. at the address or telephone
number set forth on the back page hereof.
ON JANUARY 17, 1995, UNION PACIFIC ANNOUNCED THAT IT WAS AMENDING ITS
PENDING CASH TENDER OFFER FOR SHARES OF SANTA FE COMMON STOCK (THE "SHARES") TO
PROVIDE FOR THE PURCHASE OF 100% OF THE OUTSTANDING SANTA FE SHARES AT A PRICE
OF $18.50 PER SHARE IN CASH. Union Pacific's amended cash tender offer (the
"Amended Cash Tender Offer") is conditioned, among other things, on termination
of the Santa Fe/BN merger agreement (the "Santa Fe/BN Merger Agreement") in
accordance with its terms, the stockholders of Santa Fe not having approved the
Santa Fe/BN Merger and negotiation of a mutually satisfactory merger agreement
between Santa Fe and Union Pacific in accordance with the terms of Santa Fe's
existing merger agreement with BN. The Amended Cash Tender Offer is not
conditioned upon receipt of approval of the Interstate Commerce Commission
("ICC") of Union Pacific's acquisition of control of Santa Fe. In the event that
(a) stockholders of Santa Fe do not approve the Santa Fe/BN Merger and the other
conditions to the Amended Cash Tender Offer are satisfied or waived, and (b)
there have been validly tendered prior to the expiration of the Amended Cash
Tender Offer and not withdrawn at least 90% of the outstanding Shares, Union
Pacific will waive the condition that Union Pacific and Santa Fe shall have
entered into a mutually satisfactory merger agreement provided that the ICC
staff shall have first provided a favorable informal, non-binding opinion with
respect to, or the ICC shall have first approved, certain amendments to Union
Pacific's Voting Trust. See "The Amended Union Pacific Cash Tender Offer" below.
<PAGE> 2
- ----------------------------------IMPORTANT-------------------------------------
UNION PACIFIC WILL TERMINATE THE AMENDED CASH TENDER OFFER IF
STOCKHOLDERS OF SANTA FE APPROVE THE SANTA FE/BN MERGER.
- --------------------------------------------------------------------------------
EVEN IF YOU HAVE ALREADY VOTED IN FAVOR OF THE SANTA FE/BN MERGER, YOU HAVE
EVERY RIGHT TO CHANGE YOUR VOTE. YOU MAY REVOKE YOUR PRIOR PROXY AND VOTE
AGAINST THE SANTA FE/BN MERGER BY SIGNING, DATING AND MAILING THE ENCLOSED GOLD
PROXY IN THE ENCLOSED SELF-ADDRESSED ENVELOPE. EACH VALIDLY EXECUTED PROXY YOU
SUBMIT REVOKES ALL PRIOR PROXIES. NO POSTAGE IS NECESSARY IF YOUR PROXY IS
MAILED IN THE UNITED STATES. VALIDLY EXECUTED GOLD PROXIES PREVIOUSLY SOLICITED
BY UNION PACIFIC WILL BE VOTED AT THE SPECIAL MEETING UNLESS REVOKED PRIOR
THERETO.
PLEASE SIGN, DATE AND MAIL THE GOLD PROXY TODAY. YOUR VOTE IS IMPORTANT NO
MATTER HOW MANY OR HOW FEW SHARES YOU OWN.
THIS SECOND SUPPLEMENT AMENDS AND MODIFIES, AND SHOULD BE READ IN
CONJUNCTION WITH, THE UNION PACIFIC PROXY STATEMENT AND FIRST SUPPLEMENT.
IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THE AMENDED CASH TENDER
OFFER, UNION PACIFIC IS NOW TENDERING FOR ALL SHARES OF SANTA FE COMMON STOCK AT
A PRICE OF $18.50 PER SHARE IN CASH. UNION PACIFIC NO LONGER IS PROPOSING TO
ISSUE SHARES OF UNION PACIFIC COMMON STOCK OR OTHER SECURITIES IN A SECOND-STEP
MERGER.
2
<PAGE> 3
THE AMENDED UNION PACIFIC CASH TENDER OFFER
On January 17, 1995, Union Pacific announced that it was modifying and
improving its proposal to acquire Santa Fe. Pursuant to the terms and subject to
the conditions of the Amended Cash Tender Offer, Union Pacific is offering to
purchase all of Santa Fe's outstanding Shares (including the associated
preferred share purchase rights (the "Rights") issued in connection with Santa
Fe's stockholders rights plan (the "Rights Plan")) in a cash tender offer for
$18.50 per Share. Upon completion of the Amended Cash Tender Offer, Union
Pacific would acquire any outstanding Shares not tendered and purchased in the
Amended Cash Tender Offer (other than dissenting Shares) in a subsequent cash
merger (the "Proposed Cash Merger") in exchange for $18.50 per Share, the same
consideration paid in the Amended Cash Tender Offer.
Union Pacific will place all Shares acquired by Union Pacific (whether
pursuant to the Amended Cash Tender Offer or the Proposed Cash Merger) into a
voting trust (the "Voting Trust") that would be independent of Union Pacific. On
November 28, 1994, Union Pacific received an informal, non-binding opinion from
the ICC staff authorizing the use of the Voting Trust, and on December 20, 1994
the ICC approved the Voting Trust. Neither the Amended Cash Tender Offer nor the
Proposed Cash Merger would be conditioned upon receipt of approval by the ICC of
Union Pacific's acquisition of control of Santa Fe. See "ICC Matters; The Voting
Trust."
The Amended Cash Tender Offer and withdrawal rights will expire at 12:00
midnight, New York City time, on Tuesday, February 7, 1995, unless the Amended
Cash Tender Offer is extended. A complete description of the terms and
conditions of the Amended Cash Tender Offer, certain additional information
relating to the Voting Trust and other background information is contained in
the Offer to Purchase dated November 9, 1994 (as amended by the Supplement to
the Offer to Purchase dated January 18, 1995 and as it may be amended from time
to time, the "Offer to Purchase").
THIS SECOND SUPPLEMENT IS NEITHER AN OFFER TO PURCHASE NOR A SOLICITATION
OF OFFERS TO SELL SHARES OF SANTA FE COMMON STOCK. ANY SUCH OFFER IS MADE ONLY
PURSUANT TO THE OFFER TO PURCHASE.
TENDERING SHARES OF SANTA FE COMMON STOCK WILL NOT CONSTITUTE THE GRANT OF
A PROXY TO VOTE IN CONNECTION WITH THE SANTA FE/BN MERGER. ACCORDINGLY, UNION
PACIFIC URGES SANTA FE STOCKHOLDERS TO SUBMIT A GOLD PROXY CARD TO VOTE AGAINST
THE SANTA FE/BN MERGER, WHETHER OR NOT YOU TENDER YOUR SANTA FE SHARES PURSUANT
TO THE AMENDED CASH TENDER OFFER.
The Amended Cash Tender Offer is conditioned upon, among other things, (1)
there being validly tendered prior to the expiration of the Amended Cash Tender
Offer and not withdrawn a number of Shares which, when added to the Shares
beneficially owned by UP Acquisition Corporation, a wholly-owned subsidiary of
Union Pacific (the "Purchaser"), and its affiliates, constitutes at least a
majority of the Shares outstanding on a fully diluted basis, (2) Santa Fe having
entered into a definitive merger agreement with Union Pacific and the Purchaser
to provide for the acquisition of Santa Fe pursuant to the Amended Cash Tender
Offer and the Proposed Cash Merger, (3) the stockholders of Santa Fe not having
approved the Santa Fe/BN Merger, (4) the Purchaser being satisfied that Section
203 of the Delaware General Corporation Law has been complied with or is invalid
or otherwise inapplicable to the Amended Cash Tender Offer and the Proposed Cash
Merger, (5) the Purchaser being satisfied that the Santa Fe/BN Merger Agreement
has been terminated in accordance with its terms, (6) the Purchaser being
satisfied that the Rights issued pursuant to
3
<PAGE> 4
the Rights Plan have been redeemed by Santa Fe or the Rights are unenforceable
or otherwise inapplicable to the Amended Cash Tender Offer and the Proposed
Merger and (7) the absence of any judicial, administrative or other
determination invalidating, modifying or imposing limitations unacceptable to
the Purchaser on the ICC's approval of the Purchaser's use of a Voting Trust.
The Amended Cash Tender Offer is also subject to other terms and conditions
described in the Offer to Purchase. The Amended Cash Tender Offer is not
conditioned upon approval by the ICC of the Purchaser's acquisition of control
of Santa Fe, a due diligence condition or Union Pacific obtaining financing. The
purchase of Shares in the Amended Cash Tender Offer and Proposed Cash Merger
would be a taxable transaction for federal income tax purposes.
The Purchaser will waive the condition that Santa Fe and Union Pacific
enter into a mutually satisfactory merger agreement if at least 90% of the
outstanding Shares have been tendered prior to the expiration of the Amended
Cash Tender Offer and not withdrawn, and all other conditions to the Amended
Cash Tender Offer have been satisfied or waived and (1) the Purchaser is
satisfied in its sole discretion that, immediately following the consummation of
the Amended Cash Tender Offer, the Purchaser will have the ability to effectuate
a short-form merger under Section 253 of the Delaware General Corporation Law
(the "Short-Form Merger") and (2) the Purchaser has received a favorable
informal, non-binding opinion of the ICC staff with respect to, or ICC approval
of, an amendment to the Voting Trust to enable the Trustee to take actions to
cause Santa Fe to cooperate with the Purchaser in obtaining approval of the ICC
of the acquisition of control of Santa Fe by Union Pacific (the "ICC Control
Approval"). Such actions would include (i) amending Santa Fe's Certificate of
Incorporation, in connection with effecting the Short-Form Merger, to eliminate
the classified form of Santa Fe's Board of Directors and to enable the Trustee
to remove Santa Fe's directors without cause and (ii) providing that the Trustee
would elect new directors of Santa Fe who are committed to entering into an
agreement to cooperate with the Purchaser in obtaining the ICC Control Approval
and who are committed to maintain the integrity of Santa Fe's railroad business
pending receipt of ICC Control Approval. Although favorable ICC action with
respect to the amendment to the Voting Trust is expected, there can be no
assurance that such action will be forthcoming. The Purchaser intends to seek
ICC approval of such amendment to the Voting Trust at such time as the Purchaser
is satisfied that the Santa Fe/BN Merger has not been approved by Santa Fe's
stockholders. In the Short-Form Merger, each outstanding Share that is not
purchased in the Amended Cash Tender Offer (other than dissenting Shares) would
be converted into the right to receive $18.50 in cash.
The Amended Cash Tender Offer is subject to conditions which may or may not
be satisfied. Unless all of the conditions to the Amended Cash Tender Offer are
either satisfied or waived, there can be no assurance that the Purchaser will
purchase any Shares pursuant to the Amended Cash Tender Offer.
The Purchaser is currently reviewing its options with respect to the
Amended Cash Tender Offer and may consider, among other things, changes to the
material terms of the Amended Cash Tender Offer. In addition, Union Pacific and
the Purchaser intend to continue to seek to negotiate with Santa Fe with respect
to the acquisition of Santa Fe by Union Pacific or the Purchaser. The Purchaser
has reserved the right to amend the Amended Cash Tender Offer (including
amending the number of Shares to be purchased, the purchase price and the
proposed second-step merger consideration) upon entry into a merger agreement
with Santa Fe or to negotiate a merger agreement with Santa Fe not involving a
tender offer. Accordingly, such negotiations could result in, among other
things, amendment or termination of the Amended Cash Tender Offer and submission
of a different acquisition proposal to Santa Fe's stockholders for their
approval.
4
<PAGE> 5
There is no requirement that Santa Fe stockholders wishing to accept the
Amended Cash Tender Offer vote their Shares in any specific way and there is no
requirement that Santa Fe stockholders tender their Shares in order to vote
against the Santa Fe/BN Merger. However, by voting AGAINST the Santa Fe/BN
Merger, stockholders will be voting to satisfy one of the conditions to the
Amended Cash Tender Offer. Even if the condition that Santa Fe stockholders do
not vote to approve the Santa Fe/BN Merger is satisfied, there can be no
assurance that the other conditions to the Amended Cash Tender Offer will be
satisfied and accordingly there can be no assurance that any Shares will be
purchased in the Amended Cash Tender Offer.
CERTAIN RECENT DEVELOPMENTS
SINCE NOVEMBER 9, 1994
On November 10, 1994, Union Pacific announced that it had signed a
commitment letter with a group of banks to provide aggregate financing of $2
billion for its tender offer which had commenced on November 9, 1994.
According to the BN and Santa Fe Joint Offer to Purchase, dated December
23, 1994, as supplemented by the Supplement dated January 13, 1995, filed with
the Securities and Exchange Commission (collectively, the "Joint Offer to
Purchase"), on November 11, 1994, Santa Fe requested that BN consider
restructuring the merger in response to Union Pacific's announcement that it
would establish the Voting Trust. BN did not make a substantive response to this
request.
On November 13, 1994, Dick Davidson, President of Union Pacific and
Chairman and Chief Executive Officer of Union Pacific Railroad Company, sent the
following letter to Robert D. Krebs, Chairman, President and Chief Executive
Officer of Santa Fe:
November 13, 1994
Mr. Robert D. Krebs
Chairman, President & CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, Illinois 60173
Dear Rob:
I am writing to express our disappointment with your continued refusal
to discuss our proposal. Five days ago, we submitted a newly structured
proposal to negotiate an acquisition of Santa Fe. The value of our proposed
transaction represents a premium to the consideration in your proposed
Burlington Northern merger. We included a voting trust in order to
eliminate the risk to Santa Fe shareholders of ICC review of a Santa
Fe/Union Pacific combination. Although you have repeatedly said that you
would consider such a proposal, we have heard nothing from you.
We believe our proposal is superior to the Burlington Northern merger
in terms of price, timing and certainty. We assume you are talking with
Burlington Northern to see if they will improve their transaction. One
cannot conduct a fair auction by negotiating and sharing information with
only one of the bidders. In light of our current proposal, we believe it is
contrary to the best interests of your
5
<PAGE> 6
shareholders and a clear violation of your Board of Directors' fiduciary
duties for you to refuse to talk with us.
It is not possible for you to "consider" our proposal fairly without
meeting with us. We are prepared to negotiate any and all of the
contractual terms of our draft merger agreement provided to you last
Thursday. For instance, as we indicated in our draft agreement, we are
prepared to discuss the conditions to our tender offer in the context of a
negotiated transaction. We are also prepared to discuss any issues you may
have concerning the structure of, or process for using, a voting trust.
We note that our draft merger agreement, unlike your agreement with
Burlington Northern, would provide Santa Fe with the right to terminate the
agreement in order to accept a superior competing offer. We strongly urge
that you not enter into any further agreement with Burlington Northern
(including any additional amendment to your existing merger agreement)
without including such a right of termination. This is especially
appropriate and important in light of our proposal.
Delaware law and your Board's fiduciary duties require that you
establish a level playing field. You have flexibility to achieve this
without violating your contractual obligations to Burlington Northern. It
is time for you to act in the best interest of your shareholders and in
accordance with your fiduciary obligations by meeting with us now.
Your shareholders' meeting is scheduled to be held in only five days.
Please call me so that we can arrange a time and place for a meeting.
Sincerely,
/s/ Dick Davidson
cc: Board of Directors
Santa Fe Pacific Corporation
On November 14, 1994, Santa Fe issued a press release stating that Santa
Fe's Board of Directors had postponed the Special Meeting of Stockholders to
vote on the Santa Fe/BN Merger until Friday, December 2, 1994.
On November 22, 1994, Santa Fe's Board of Directors recommended that
stockholders not tender their Shares to Union Pacific. Santa Fe's
Solicitation/Recommendation Statement on Schedule 14D-9, dated November 22, 1994
(together with all amendments thereto, the "Schedule 14D-9"), disclosed that the
Santa Fe Board had based its recommendation on the following factors: (i)
uncertainty regarding whether or when the ICC opinion will be issued on the
Voting Trust and whether the ICC may prevent Union Pacific from using a Voting
Trust; (ii) Union Pacific's proposal is a taxable transaction, whereas BN's
proposal is nontaxable; and (iii) Union Pacific's offer is subject to a number
of other conditions which suggest that the proposal is too uncertain to be
considered a firm alternative to the Santa Fe/BN Merger. The Schedule 14D-9
stated that Santa Fe's Board believes that Union Pacific should improve the
financial terms of its latest
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<PAGE> 7
proposal. Also on November 22, 1994, Mr. Davidson sent the following letter to
Mr. Krebs commenting on, among other things, the Schedule 14D-9:
November 22, 1994
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, IL 60173
Dear Rob:
Two weeks ago, we submitted our revised proposal to negotiate an
acquisition of Santa Fe. Our terms and structure -- fair price and a voting
trust -- meet the criteria that you have set forth on a number of occasions
for considering our proposal. Since making our proposal, despite our
repeated requests to begin discussions, you have refused to talk or meet
with us.
Today, I received your letter and a copy of your Schedule 14D-9 filing
in which you publicly recommended that your stockholders not tender their
shares. The stated reasons for your Board's rejection of our proposal are
unpersuasive and, we believe, misleading in many respects. Of equal
importance, the issues you raise are precisely the issues you should have
been discussing with us during the last two weeks.
Your first objection relates to our proposed use of a voting
trust -- notwithstanding your own previous demands that we propose a voting
trust. You point out the obvious fact that we have not yet obtained
Interstate Commerce Commission approval to use the trust. Yet, you fail to
mention that the use of a trust in a situation such as ours has never been
denied by the ICC. We believe that ICC approval of our trust will be
forthcoming shortly.
You ask us to improve the financial terms of our proposal, yet you
fail to mention that our proposal represents a premium to the consideration
in your proposed Burlington Northern merger, which has been endorsed by
your financial advisors as fair to your shareholders. We were surprised by
the failure in your Schedule 14D-9 to advise Santa Fe shareholders of the
views of your financial advisors as to the fairness of our offer. We
believe it is highly unusual for a board of directors to make a
recommendation without obtaining such advice. If your Board did obtain such
advice, it should have been disclosed to your shareholders.
You claim that our proposal is too conditional, yet you fail to
mention that we advised you in writing on November 13 that we were prepared
to negotiate all contractual terms of our proposal, including the
conditions to our tender offer. We believe the condition of ICC approval of
your merger with Burlington Northern creates considerable uncertainty for
that transaction. Our proposal would eliminate that risk for your
shareholders.
You note that our transaction is a taxable one, yet you fail to
mention our continued willingness to discuss with Santa Fe our tax-free,
stock-for-stock proposal.
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<PAGE> 8
Finally, you ask for "clarification" of these issues. Can there be any
effective way of obtaining clarification other than for you to meet with
us? You say your recommendation is "subject to change as events unfold"
that "clarify" our proposal, yet you have resisted obtaining such
clarification.
The process you have established of engaging in discussions and
sharing information with Burlington Northern while refusing to talk or meet
with us prevents us from competing on an equal basis. This process cannot
possibly allow you and your Board of Directors to fulfill your fiduciary
duty and maximize value for your shareholders.
We again call on you to establish a fair process and meet with us.
Sincerely,
/s/ Dick Davidson
cc: Board of Directors
Santa Fe Pacific Corporation
On November 23, 1994, Union Pacific announced that it expected to extend
its tender offer beyond the December 8, 1994 deadline because of Santa Fe's
unwillingness to negotiate a merger agreement.
On November 25, 1994 and November 27, 1994, representatives of Santa Fe's
financial advisor and representatives of Union Pacific's financial advisor
discussed whether Union Pacific would be willing to increase the price of its
proposal.
On November 28, 1994, Union Pacific announced that it had received an
informal, non-binding opinion from the staff of the ICC authorizing the use of
the Voting Trust in its proposed transaction with Santa Fe. Also on November 28,
1994, Union Pacific announced that Mr. Davidson sent the following letter to Mr.
Krebs:
November 28, 1994
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, IL 60173
Dear Rob:
In several recent communications, you have insisted that Union Pacific
improve its proposal as a pre-condition to your having any discussions or
sharing any information with us. We believe this position only creates an
additional impediment to your establishing a fair process for the sale of
Santa Fe.
Over the last two months, we have unilaterally made three attractive
proposals to negotiate an acquisition of Santa Fe. During this period, you
have consistently refused to talk or to meet with us and have been
unwilling to provide us with any of the confidential information that you
furnished to Burlington Northern.
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<PAGE> 9
As you know, the Interstate Commerce Commission today approved the use
of a voting trust in our proposed acquisition. We believe our current
proposal is superior to that of Burlington Northern in terms of price, form
of consideration, timing and certainty. The next step should be yours. It
is time to begin discussions and to share information.
Sincerely,
/s/ Dick Davidson
cc: Board of Directors
Santa Fe Pacific Corporation
On November 29, 1994, Santa Fe announced that it had postponed from
December 2, 1994 to December 16, 1994 the Special Meeting of Stockholders to
vote on the Santa Fe/BN Merger. Santa Fe also announced that it would meet with
Union Pacific in an effort to clarify and improve Union Pacific's offer and that
Santa Fe's Board had adopted the Rights Plan. In addition, Santa Fe stated that
the Board had postponed the distribution date of the Rights from December 1,
1994 to December 16, 1994. Later on November 29, 1994, Union Pacific's financial
advisor telephoned Santa Fe's financial advisor to discuss a possible
negotiation process between the parties and Union Pacific's access to certain
confidential information regarding Santa Fe.
According to the Joint Offer to Purchase, on December 2, 1994, Santa Fe
asked BN to consider revising the original Santa Fe/BN merger agreement to
provide for a higher exchange ratio combined with tender offers by BN and Santa
Fe for Shares and open market repurchases by Santa Fe of Shares after the tender
offer and prior to consummation of the merger, in each case contingent on
stockholder approval of the merger. Santa Fe advised BN that, based on
discussions with some of Santa Fe's large stockholders, such a revision might
draw the support of those stockholders. BN made no substantive response to this
request.
On December 3, 1994, representatives of Union Pacific and Union Pacific's
legal and financial advisors met with Santa Fe's legal advisors to review and
discuss certain financial and other information regarding Santa Fe. After
appropriate provisions had been agreed to limiting Union Pacific's access to
certain commercially sensitive information, Union Pacific's legal and financial
advisors were allowed to review certain additional information.
On December 4, 1994, representatives of Union Pacific met with
representatives of Santa Fe at Santa Fe's offices in Schaumburg, Illinois. At
this meeting, the parties discussed certain financial and other information
regarding Santa Fe.
During early December, legal advisors of Union Pacific and legal advisors
of Santa Fe conducted discussions with respect to a proposed merger agreement.
During these discussions, the legal advisors discussed, among other things, the
conditions to the original tender offer and a proposed merger agreement. In
order to address Santa Fe's concerns set forth in the Schedule 14D-9 (as set
forth above and below), Union Pacific's legal advisors sent revised conditions
to Santa Fe's legal advisors. Union Pacific and the Purchaser believe that
substantial progress was made in these discussions in negotiating a mutually
satisfactory merger agreement, although no final agreement was reached.
On December 7, 1994, Union Pacific announced that it had extended the
expiration date of its tender offer to 12:00 Midnight, New York City time, on
Friday, December 23, 1994.
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<PAGE> 10
According to the Joint Offer to Purchase, on December 13, 1994,
representatives of BN informed representatives of Santa Fe that BN might be
willing, subject to approval of BN's Board of Directors, to combine an increase
in the exchange ratio for the merger with a tender offer by both BN and Santa Fe
for Shares and possible repurchases by Santa Fe of Shares in the open market
after the tender offer and prior to consummation of the Santa Fe/BN Merger, in
each case contingent on stockholder approval of the merger. Representatives of
BN and representatives of Santa Fe then discussed the possible terms such a
transaction might include.
According to the Joint Offer to Purchase, on or about December 14, 1994,
Santa Fe postponed its Special Meeting of Stockholders to vote on the original
Santa Fe/BN Merger to January 27, 1995, and changed the record date for that
meeting to December 27, 1994. Also on December 14, representatives of BN and
representatives of Santa Fe continued the discussions they had conducted the
previous day.
On December 14, 1994, despite Union Pacific's receipt of an informal
non-binding staff opinion from the ICC authorizing the use of the Voting Trust,
Santa Fe's Board of Directors continued to recommend that stockholders not
tender their Shares to Union Pacific. According to Amendment No. 3 to the
Schedule 14D-9, Santa Fe disclosed that the Santa Fe Board had based its
recommendation on the fact that:
the Union Pacific Offer is subject to a number of conditions that are of
concern to [Santa Fe]. These conditions provide Union Pacific with the
broad discretionary ability to terminate its [o]ffer upon the occurrence of
certain events, many of which are not necessarily in the direct control of
[Santa Fe]. Such conditions include, but are not limited to, the occurrence
of a threat or commencement of any action or proceeding by any person
challenging the transactions contemplated by the [o]ffer or any subsequent
merger; any material adverse change in prices generally of shares on the
New York Stock Exchange; armed hostilities directly or indirectly involving
the United States; and any tender or exchange offer or any public proposal
of a tender or exchange offer for any common stock of [Santa Fe] by any
other person.
In the Schedule 14D-9, Santa Fe further based its recommendation on the
fact that:
the merger agreement that Union Pacific is asking [Santa Fe] to execute as
a condition to consummating the [o]ffer would require that [Santa Fe] make
a number of representations and warranties and that the accuracy of those
representations and warranties be a condition to consummation of the
merger. This requirement is problematic for [Santa Fe] because it creates a
risk that Union Pacific could consummate the [o]ffer but fail to consummate
the merger, leaving Santa Fe's present stockholders as minority
stockholders.
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<PAGE> 11
On December 14, 1994, Drew Lewis, Chairman and Chief Executive Officer of
Union Pacific, sent the following letter to Mr. Krebs:
December 14, 1994
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, IL 60173
Dear Rob:
I am writing to advise you, as requested by your advisors, of our
position concerning our merger proposal.
Our response at this stage is a function of Santa Fe's having pursued
a flawed sale process. Your advisors have repeatedly demanded that we
improve our proposal while refusing to establish any procedures for
considering competing proposals on a fair and equal basis. In fact, your
advisors have frequently told us you will not negotiate with Union Pacific
unless we agree to pay at least $20 per Santa Fe share. This position is
clearly inconsistent with your negotiating and recommending several
transactions with Burlington Northern at prices well below $20.
We believe our current proposal is an extremely attractive one and in
the best interests of Santa Fe and its shareholders and customers. Despite
this, you have continued to pursue a process that favors any result other
than a transaction with Union Pacific. We are prepared to continue
discussions with you, but we urge you to establish a fair and open sale
process.
Sincerely,
/s/ Drew
On December 15, 1994, Union Pacific's legal advisor sent the following
letter to Santa Fe's legal advisor:
December 15, 1994
Scott J. Davis, Esq.
Mayer, Brown & Platt
190 South LaSalle Street
Chicago, Illinois 60606
Dear Scott:
On behalf of Union Pacific, I am writing to raise a number of concerns
with the process that Santa Fe has established for considering competing
proposals to acquire Santa Fe. These issues were described yesterday in
detail by CS First Boston to Goldman Sachs and also were referred to in a
letter from Drew Lewis to Robert Krebs.
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<PAGE> 12
As CS First Boston advised Goldman Sachs yesterday, Santa Fe has not
necessarily received Union Pacific's best proposal. Union Pacific has been
and is willing to consider and discuss revisions to its proposal. However,
Union Pacific's response at this stage is a function of Santa Fe's having
pursued what we believe is a flawed sale process. Santa Fe has failed to
treat bidders on a fair and equal basis and appears to be pursuing a
process that favors any outcome other than a transaction with Union
Pacific.
Specifically, among other things, Santa Fe's financial advisors have
repeatedly stated that Santa Fe will not negotiate a transaction with Union
Pacific unless Union Pacific confirms that it is prepared to provide value
of at least $20 per Santa Fe share. This position is inconsistent with
Santa Fe's negotiating and recommending several transactions with
Burlington Northern, all of which have been at prices well below $20. We
are concerned that your insistence on such a high price as a condition to a
transaction with Union Pacific serves to discourage any transaction with
Union Pacific while you pursue a variety of alternative transactions with
Burlington Northern at a lower value level. If you also have told
Burlington Northern and any other interested parties that you will not
negotiate a transaction unless it provides value of at least $20 per share,
you should disclose to us and the public that you have established a $20
bidding floor for all potential purchasers.
We are further concerned that Santa Fe has limited itself to
"clarifying" Union Pacific's proposal, while apparently engaging in
extensive substantive negotiations with Burlington Northern. Santa Fe's
process appears designed to use Union Pacific as a stalking horse, and use
what we discuss with you in your negotiations with Burlington Northern.
There have been reports about Santa Fe's consideration of alternative
structures for a transaction. We are prepared to consider alternative
structures and request that you promptly advise us of any alternatives
which your client may prefer.
Please advise Santa Fe that Union Pacific is eager to participate in a
fair process, and is willing to consider and negotiate revisions to its
proposal. Union Pacific asks only that it be treated on an equal basis with
Burlington Northern.
You will be receiving today by separate cover a revised form of merger
agreement. Union Pacific's draft merger agreement contains fewer
conditions, and provides greater certainty, than your agreement with
Burlington Northern. Notwithstanding this, Union Pacific is prepared to
discuss any and all remaining concerns you may have.
We note that our agreement does not contain any "lock-up" provision,
despite Union Pacific's having unilaterally offered Santa Fe a right to
terminate any agreement with Union Pacific in order to accept a superior
proposal -- a right which does not exist in your current agreement with
Burlington Northern. We expect that your concerns about providing Union
Pacific with any lock-up or expense reimbursement apply equally to
Burlington Northern and that you will not provide Burlington Northern any
stock or asset rights, a "bust up" fee or other arrangement that would in
any manner impede Union Pacific's efforts to pursue a transaction with
Santa Fe.
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<PAGE> 13
I would appreciate your discussing these matters with your client and
responding to us at your earliest convenience.
Sincerely,
/s/ Paul T. Schnell
Skadden, Arps, Slate, Meagher &
Flom
cc: Carl W. von Bernuth, Esq.
Also on December 15, 1994, Mr. Krebs sent the following letter in response
to Mr. Lewis' letter:
December 15, 1994
Mr. Drew Lewis, Chairman
Union Pacific Corporation
Martin Tower
Eighth and Eaton Avenues
Bethlehem, Pennsylvania 18018
Dear Drew:
This is in response to your letter dated December 14, 1994 concerning
the process that Santa Fe is currently pursuing. Your letter assumes that
Santa Fe is conducting an auction. In fact, however, the board of Santa Fe
has never put the company up for sale. Instead, subject to shareholder
approval, the board agreed to a strategic combination with the Burlington
Northern, which is designed to achieve significant long-term growth for
Santa Fe's shareholders far beyond the current value of the Burlington
Northern stock that is to be exchanged in the merger. After that agreement
was announced, Union Pacific made an unsolicited merger proposal to Santa
Fe.
As you know, under our contract with Burlington Northern, Santa Fe
could not provide confidential information to or negotiate with any other
potential merger partner unless the board was advised by counsel that it
had a fiduciary duty to do so. After Union Pacific improved its offer and
obtained the ICC staff's approval of its proposed voting trust, we were
advised by our counsel that we did have a fiduciary duty to provide
information and to negotiate with Union Pacific. In the past two weeks, we
have made available to Union Pacific all of the information that was given
to Burlington Northern, and more. In fact, at a meeting in our office on
December 4, 1994, your executive vice president-finance, L. White Matthews
III, told a group of our senior officers that the amount of information
Union Pacific had received from Santa Fe was more than they "dreamed" of
obtaining. In addition, we have negotiated in good faith the terms of Union
Pacific's proposed merger agreement and tender offer.
Throughout our discussions over the past two weeks we have continually
emphasized the need for Union Pacific to improve its offer as soon as
possible. We have also been negotiating with Burlington Northern with a
view toward improving the existing merger agreement. In all of these
discussions, our goal has been to achieve the best result for our
shareholders, taking into account both short-term and long-term objectives.
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<PAGE> 14
I believe that we have done everything we can to enable Union Pacific
to improve its offer, and, as our financial advisors have been telling your
financial advisors for many days, we hope you will do so promptly. The
process we have followed is designed to promote the best interests of our
shareholders.
Sincerely,
/s/ Rob
According to the Joint Offer to Purchase, on December 15, 1994, Santa Fe's
Board met and heard a presentation from Santa Fe's management and financial and
legal advisors regarding BN's proposal. Santa Fe's Board authorized its
representatives to negotiate with BN representatives to attempt to reach a
definitive agreement.
On December 15, 1994, Union Pacific issued a press release confirming that
it continued to hold discussions with Santa Fe in response to Santa Fe's request
that Union Pacific clarify its acquisition proposal. Union Pacific also
requested that Santa Fe clarify its process for considering competing proposals.
Also on December 15, 1994, Santa Fe announced that Santa Fe's Board had
postponed the distribution date of the Rights from December 16, 1994 to January
31, 1995.
On December 16, 1994, Union Pacific announced that it would consider
revising its proposal if Santa Fe established a fair process. Also on December
16, 1994, Mr. Lewis sent the following letter to Mr. Krebs:
December 16, 1994
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, IL 60173
Dear Rob:
I have read your December 15 letter, and can only conclude that you
have not been kept fully apprised of the actions of your management and
advisors.
Your characterization of Santa Fe's process for considering bids, or
lack of such a process, is inaccurate and distorted. Most importantly, you
have not, as you assert, done everything you can to enable Union Pacific to
revise its proposal. On the contrary, Santa Fe has pursued a process that
favors any outcome other than a transaction with Union Pacific.
We are extremely disappointed with the flawed and biased sale process
being pursued by Santa Fe. Our financial advisor, CS First Boston,
expressed our concerns to your financial advisor, Goldman Sachs, on
December 14. On December 15, before you sent me your letter, our counsel
expressed these concerns in a letter to your counsel, a copy of which is
enclosed.
And now, in light of your letter, I will tell you directly of our
concerns.
14
<PAGE> 15
Here are the facts:
1. Your advisors have said you will not even consider a proposal from
us at less than $20 per share, although you negotiated and recommended
several transactions with Burlington Northern at prices well below $20 per
share. Your insistence on such a high minimum price as a condition to a
transaction with Union Pacific discourages any transaction with Union
Pacific while you pursue a variety of alternative transactions with
Burlington Northern at a lower value level.
2. Santa Fe has refused to establish any procedures that would permit
us to compete on an equal basis with Burlington Northern. While you
obviously have continued to engage in serious, substantive negotiations
with Burlington Northern, you have simply sought "clarifications" from us
while repeatedly asking us to "improve" what for many weeks has been the
most attractive proposal on the table. You are using Union Pacific as a
stalking horse for an improved Burlington Northern bid. Based on your
agreement with Burlington Northern, we must assume that Santa Fe is using
information obtained in its discussions with Union Pacific to assist
Burlington Northern in its efforts to improve its bid.
3. Santa Fe has discussed alternative acquisition structures with
Burlington Northern, but, despite our stated willingness to consider
alternative structures and revisions to our current proposal, you have not
given us any indication of what alternative structures would be acceptable
to Santa Fe.
4. Santa Fe, in its recent Schedule 14D-9 filing, stated that our
proposal "is subject to a number of conditions that are of concern to
[Santa Fe]." But, the fact is, Union Pacific's proposal contains fewer
conditions, and provides greater certainty for your shareholders, than the
transaction you willingly agreed to with Burlington Northern.
5. Santa Fe's Board of Directors unilaterally adopted a "poison pill"
rights plan that specifically exempts Burlington Northern but is applicable
to our proposal.
6. Santa Fe has stood silently by while Burlington Northern, your
preferred suitor, has tried unsuccessfully to block ICC approval of our
voting trust. This is the voting trust that you specifically asked us to
establish more than two months ago and that provides speed and certainty
for your shareholders.
7. Santa Fe apparently never asked its financial advisor to express
its opinion as to the fairness of our proposal, but, as you know, Santa Fe
previously requested and received a fairness opinion on the Burlington
Northern merger which, at the time, based on the then current market price,
valued Santa Fe shares at approximately $13.50.
This listing is by no means exhaustive but is illustrative of the
flawed and biased sale process undertaken by Santa Fe. In light of this,
the assertion that Santa Fe's goal has been to achieve the best results for
its shareholders rings hollow.
Let me be very clear. By your actions you have put Santa Fe up for
sale and Union Pacific is a very interested buyer. We want to acquire Santa
Fe by competing on an equal basis with Burlington Northern and any other
potential bidders. If Santa Fe establishes a fair and open process, we
would be eager to participate, and would be willing to consider and discuss
revisions to our proposal.
Santa Fe has stated that it is considering alternative structures. If
you and your Board truly desire a fair process, it is incumbent upon you to
inform us promptly of each alternative under consideration, to
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<PAGE> 16
state the minimum bidding level (if any) applicable to all interested
parties, and to give us the opportunity to consider and respond to each
alternative. In addition, you should instruct your management and advisors
to establish immediately a fair and unbiased sale process. If you would
like our specific suggestions concerning establishing a fair process, our
advisors would be pleased to provide them.
Santa Fe has not necessarily received Union Pacific's best proposal. I
await your response.
Sincerely,
/s/ Drew
Later on December 16, 1994, Union Pacific's legal advisor sent the
following letter to Santa Fe's legal advisor:
December 16, 1994
Scott J. Davis, Esq.
Mayer, Brown & Platt
190 South LaSalle Street
Chicago, Illinois 60606
Dear Scott:
We have not received any response to Drew Lewis' letter to Robert
Krebs sent earlier today or to my letter to you dated December 15.
I am writing on behalf of Union Pacific Corporation to suggest that
the legal and financial advisors of each party meet briefly to discuss
whether we can structure a process for going forward that is acceptable to
both our clients.
Based on Union Pacific's willingness to consider and discuss revisions
to its proposal, it would be in both parties' interest to continue to
progress with the discussions. We hope that a meeting of advisors would
enable our clients to do that.
Please call me at any time this evening or over the weekend to discuss
this matter.
Sincerely,
/s/ Paul T. Schnell
Skadden, Arps, Slate, Meagher &
Flom
cc: Carl W. von Bernuth, Esq.
Also on December 16, 1994, Union Pacific extended the expiration date of
its tender offer to 12:00 Midnight, New York City time, on Thursday, January 19,
1995.
According to the Joint Offer to Purchase, beginning on December 16, 1994,
representatives of Santa Fe and BN met to discuss whether a definitive agreement
could be reached. In addition, representatives of Santa Fe had discussions with
some of Santa Fe's large stockholders to determine whether or under what
circumstances they would make written commitments to support the revised merger.
16
<PAGE> 17
On December 17, 1994, as requested by Union Pacific, Union Pacific's
financial and legal advisors conducted a telephonic meeting with Santa Fe's
financial and legal advisors. During this meeting, among other things, Union
Pacific's advisors, on behalf of Union Pacific, expressed to Santa Fe's advisors
the interest of Union Pacific in making an improved proposal to acquire Santa Fe
provided that Union Pacific be given an opportunity to bid for Santa Fe on a
fair and equal basis with BN. Union Pacific's advisors expressed the concern
that Santa Fe had failed to establish a fair and unbiased sale process. In
particular, Union Pacific's advisors objected to the fact that Santa Fe would
continually advise BN of substantive communications occurring between Santa Fe
and Union Pacific, including with respect to any revised acquisition proposal
that Union Pacific might make. Santa Fe's advisors asserted, among other things,
that Santa Fe was not conducting an auction, time was of the essence and if
Union Pacific wanted to improve its bid, it should do so soon.
Also on December 17, 1994, according to the Joint Offer to Purchase, the
negotiations between Santa Fe's and BN's representatives continued with no
agreement being reached.
On December 17, 1994, Mr. Krebs sent Mr. Lewis the following letter:
Mr. Drew Lewis, Chairman
Union Pacific Corporation
Martin Tower
8th and Eaton Avenues
Bethlehem, PA 18018
Dear Drew:
I am not sure that continuing to trade letters on "process" issues
serves any useful function. However, let me briefly reiterate Santa Fe's
position. Contrary to the statement in your December 16 letter, the Santa
Fe board has NOT put the company up for sale, and it is not conducting an
auction. We entered into a contract for a strategic combination with
Burlington Northern -- a combination that promises significant long-term
growth. We are now negotiating with Burlington Northern in order to improve
that agreement.
At the same time, however, we have provided Union Pacific with all of
the information about Santa Fe it needs in order to make its best
alternative proposal. If you are willing and able to improve your proposal,
I suggest that you do so without delay.
Sincerely,
/s/ Rob
According to the Joint Offer to Purchase, on December 18, 1994, Santa Fe
and BN representatives reached an agreement on the terms of the revised Santa
Fe/BN Merger Agreement.
According to the Joint Offer to Purchase, on December 18, 1994, Santa Fe's
Board approved the revised Santa Fe/BN Merger Agreement. Shortly after Santa
Fe's Board meeting, BN and Santa Fe entered into the revised Santa Fe/BN Merger
Agreement.
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<PAGE> 18
On December 18, 1994, Mr. Lewis sent the following letter to Mr. Krebs:
December 18, 1994
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, IL 60173
Dear Rob:
I understand that you sent a letter to my office Saturday.
We continue to be troubled by Santa Fe's refusal to address in any way
our concerns about your process for considering acquisition proposals.
As we have repeatedly stated, and said to your advisors yesterday, we
want to be in a position to make an improved proposal. We see no reason why
you cannot address our concerns, and hope you will give consideration to
the specific suggestions made by our advisors.
Sincerely,
/s/ Drew Lewis
On December 18, 1994, Santa Fe announced that BN and Santa Fe would make a
joint tender offer to acquire 63,000,000 Shares, or approximately 33% of all
such Shares outstanding, at $20.00 per Share in a recapitalization and merger
transaction.
On December 20, 1994, Union Pacific announced that it was reviewing its
options concerning its proposal to acquire Santa Fe. Also on December 20, 1994,
Mr. Lewis sent the following letter to Mr. Krebs:
December 20, 1994
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumberg, IL 60173
Dear Rob:
The recent actions of Santa Fe are but a continuation of Santa Fe's
ongoing efforts to pursue its sale to Burlington Northern, and to prevent a
transaction with Union Pacific, at all costs.
We object to Santa Fe's grant of "lock-ups" to Burlington Northern to
deter competing bids, and to Santa Fe's repeated refusal to address our
objections to its flawed sales process.
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<PAGE> 19
With regard to Santa Fe's efforts to deter competing bids, we note
with interest that a Burlington Northern representative, who would speak
only on the condition of anonymity, was quoted today in the press as
stating: "This is a carefully crafted plan designed to accomplish the
merger and to make it prohibitively expensive for UP to top."
As we have announced, we will be reviewing our options concerning our
acquisition proposal.
Sincerely,
/s/ Drew
Also on December 20, 1994, the ICC issued an order of the full commission
approving the Voting Trust.
On December 23, 1994, Santa Fe and BN commenced a tender offer (the "Joint
Offer") for up to 63,000,000 Shares (together with the associated Rights) at
$20.00 per Share, net to the tendering stockholder in cash, with Santa Fe
severally obligated to purchase up to 38,000,000 Shares and BN severally
obligated to purchase up to 25,000,000 Shares pursuant to the Joint Offer upon
the terms and subject to the conditions set forth in the Joint Offer to
Purchase. See "Santa Fe/BN Joint Offer and Merger Proposal" below.
The original Santa Fe/BN Merger Agreement was amended to provide that,
among other things, Santa Fe is obligated under certain circumstances, to pay
certain fees to BN upon termination of the Santa Fe/BN Merger Agreement.
According to the Joint Offer to Purchase, the Santa Fe/BN Merger Agreement
specifically provides that:
[Santa Fe] has agreed that if the [Santa Fe/BN Merger Agreement] shall be
terminated due to (a) the acquisition of any Person, entity or "group"
other than [BN] of more than 50% or more of the outstanding [Shares], (b)
the approvals of the stockholders of [Santa Fe] and [BN] having not have
been obtained, (c) the Board of Directors of [Santa Fe], prior to the
meeting of stockholders of [Santa Fe], having withdrawn, modified or
changed in a manner adverse to [BN], its approval or recommendation of the
[Santa Fe/BN Merger Agreement] or the [m]erger, (d) the board of directors
of [Santa Fe] having withdrawn or modified in a manner adverse to [BN] its
approval or recommendation of the [Joint] Offer, the [Santa Fe/BN Merger
Agreement] or the [m]erger in order to permit [Santa Fe] to execute a
definitive agreement in connection with a Takeover Proposal (as defined in
the [Santa Fe/BN Merger Agreement]) or in order to approve another tender
offer for [Shares] or the board of directors of [Santa Fe] shall have
recommended any other Takeover Proposal, or (e) if the [Joint] Offer is
terminated and [Santa Fe] and [BN] shall not have purchased [Shares]
pursuant to the [Joint] Offer, then it will pay [BN] an amount equal to
$50,000,000 plus all out-of-pocket expenses, not to exceed $10,000,000
incurred by [BN] in connection with the [Santa Fe/BN Merger Agreement], the
[Joint] Offer and all related transactions ... provided, that no such
payment will be required if the [Santa Fe/BN Merger Agreement] is
terminated pursuant to clause (b), (c) or (e) above unless, after December
18, 1994, a new Takeover Proposal involving [Santa Fe] has been announced
or made (it being understood that any modification of [Union Pacific's
offer] in existence on December 18, 1994 shall be deemed a new Takeover
Proposal). [Santa Fe] has also agreed that if the [Santa Fe/BN Merger
Agreement] shall be terminated pursuant to clause (b), (c) or (e) above and
no payment is required by it in the manner contemplated above, it will
reimburse [BN] for all out-of-pocket expenses incurred by [BN] in
19
<PAGE> 20
connection with the [Santa Fe/BN Merger Agreement], the [m]erger, the
[Joint] Offer and all related transactions.
According to the terms of the Santa Fe/BN Merger Agreement, the Amended
Cash Tender Offer is an event which, under certain circumstances, would obligate
Santa Fe to pay a termination fee to BN in the amount of $50,000,000 plus an
additional amount for expenses incurred by BN up to a maximum of $10,000,000.
Also on December 23, 1994, according to Amendment No. 6 to the Schedule
14D-9, Santa Fe's Board of Directors continued to recommend that stockholders
not tender their Shares to Union Pacific.
On January 15, 1995, Union Pacific's Board of Directors met to consider the
various alternatives available to Union Pacific in connection with its efforts
to acquire Santa Fe.
On January 17, 1995, the Board of Directors of Union Pacific held a meeting
and authorized the Amended Cash Tender Offer.
Also on January 17, 1995, Mr. Lewis sent the following letter to Mr. Krebs:
January 17, 1995
Mr. Robert D. Krebs
Chairman, President and CEO
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, IL 60173
Dear Rob:
I am writing to inform you that Union Pacific has revised its
acquisition proposal to increase the price to $18.50 per share in cash and
to seek to acquire 100% of Santa Fe's outstanding shares in the tender
offer.
By using our Interstate Commerce Commission approved voting trust,
your shareholders would receive immediate payment of the entire purchase
price in our transaction, without bearing any risk relating to ICC approval
of our combination with Santa Fe. By contrast, the new, leveraged
Burlington Northern transaction would require a delay of up to several
years for payment of two-thirds of the purchase price to Santa Fe
shareholders, and would require your shareholders to bear the risk of ICC
approval.
In addition to the all-cash advantage of our offer, we believe our
transaction is superior to the Burlington Northern acquisition when one
discounts BN's purchase price for the time delay in payment, the ICC risk
of non-consummation of the BN transaction and the uncertain value of the BN
stock to be received.
Our preference remains to negotiate a merger agreement with Santa Fe.
As your own advisors stated, we were very close to completing negotiation
of a merger agreement before you announced your new
20
<PAGE> 21
transaction with Burlington Northern. We should be able to conclude our
negotiations very quickly in light of our revised offer. We continue to
believe it is a violation of your Board's fiduciary duties for Santa Fe to
resist negotiating a transaction with Union Pacific.
If you refuse to negotiate with us, we would be prepared to purchase
shares in our tender offer without a merger agreement, provided that your
shareholders tender at least 90% of Santa Fe's outstanding shares and other
impediments such as the rights plan are eliminated. In order to complete
the acquisition on a unilateral basis, we would first ask the ICC to
approve an amendment to our voting trust agreement that would enable the
trustee to cause Santa Fe, following the acquisition of Santa Fe shares, to
agree to cooperate with us in obtaining ICC approval of a Santa Fe/Union
Pacific combination. We would seek ICC approval of the amended voting trust
agreement once Santa Fe shareholders vote to disapprove the Burlington
Northern merger.
Our offer, including the conditions to our transaction, remains
unchanged in all other material respects. Given your rejection of our
alternative $20 all-stock proposal made several months ago, we confirm our
withdrawal of such alternative proposal.
Sincerely,
/s/ Drew
cc: Board of Directors
Santa Fe Pacific Corporation
On January 17, 1995, Union Pacific announced the terms of the Amended Cash
Tender Offer described in the above letter.
On January 18, 1995, the Purchaser commenced the Amended Cash Tender Offer.
ICC MATTERS; THE VOTING TRUST
On November 28, 1994, Union Pacific received an informal, non-binding
opinion from the staff of the ICC authorizing the use of the Voting Trust in its
proposed acquisition of Santa Fe.
Also on November 28, 1994, the ICC, acting through Chairman McDonald (the
"Chairman"), denied petitions of BN's railroad subsidiary, Burlington Northern
Railroad Company ("BNR"), and the Kansas City Southern Railway Company ("KCS")
and a letter request of the State of Colorado Department of Transportation, all
seeking to have the ICC formally investigate, and solicit public comment on,
Union Pacific's proposed Voting Trust, and a petition of a number of railroad
unions (the "Rail Unions") seeking various declaratory orders with regard to the
Voting Trust. BNR, KCS and the Rail Unions subsequently appealed this decision
to the full ICC, and Union Pacific filed oppositions to these administrative
appeals.
21
<PAGE> 22
On December 6, 1994, the ICC issued a decision denying a request by BNR and
others that the ICC staff's informal opinion letter be withdrawn pending
resolution of the administrative appeals, and indicating that a decision on
those appeals would be forthcoming shortly.
On December 7, 1994, BNR filed actions in the United States Court of
Appeals for the Third Circuit (the "Third Circuit") seeking review of the
December 6, 1994 decision and an injunction barring Union Pacific and the
Purchaser from placing the Shares in the Voting Trust until the ICC conducted a
formal investigation.
On December 12, 1994, Union Pacific filed an opposition to BNR's injunction
request in the Third Circuit. On December 12, 1994, the ICC filed a memorandum
with the Third Circuit indicating that the ICC would shortly be deciding the
administrative appeals, and urging the court to refrain from issuing any
dispositive orders in the meantime. On December 14, 1994, BNR filed a reply in
support of its injunction request.
On December 12, 1994, the Rail Unions filed petitions in the Third Circuit
seeking a writ of mandamus against the ICC directing the ICC to investigate the
Voting Trust and bar Union Pacific and the Purchaser from using the Voting
Trust, and an injunction against Union Pacific and the Purchaser prohibiting the
use of the Voting Trust until the ICC has granted Union Pacific authority to
control Santa Fe. On December 16, 1994, Union Pacific filed an opposition to
these petitions. On December 16, 1994, the ICC filed a memorandum with the Third
Circuit indicating that the ICC would shortly be deciding the administrative
appeals, and that the Rail Unions' action should thus be dismissed as moot.
On December 20, 1994, the ICC issued a decision of the full commission
denying the administrative appeals of BNR, KCS and the Rail Unions from the
Chairman's initial decision and approving the Voting Trust subject to a
modification clarifying the authority of the ICC to approve any plan of
divestiture or sale of the stock held in trust. On December 20, 1994, the ICC
also filed a motion with the Third Circuit to dismiss BNR's December 7, 1994
review petition and the Rail Unions' December 12, 1994 mandamus petition, and
suggesting that requests for an injunction against Union Pacific and the
Purchaser also be dismissed.
Also on December 20, 1994, BNR filed a petition in the Third Circuit for
review of the ICC's December 20, 1994 decision. On December 21, 1994, BNR filed
a petition with the ICC requesting a stay of the ICC's December 20, 1994
decision pending judicial review and a temporary cease and desist order against
Union Pacific to prohibit implementation of the Voting Trust pending judicial
review. On January 5, 1995, the Rail Unions filed a similar petition. On
December 22, 1994, Union Pacific filed an opposition to the BNR petition, and on
January 17, 1995, Union Pacific filed an opposition to the Rail Unions'
petition.
On December 28, 1994, BNR filed in the Third Circuit an opposition to the
ICC's December 20, 1994 motion, stating that BNR agreed that BNR's December 7,
1994 appeal is moot and could be dismissed, but denying that BNR's injunction
request should be dismissed. The Rail Unions filed a similar opposition on
January 12, 1995.
On January 6, 1995, the ICC denied the petition filed by BNR with the ICC
on December 21, 1994.
On January 10, 1995, BNR filed a motion in the Third Circuit seeking a stay
pending judicial review of the ICC's December 20, 1994 decision. On January 11,
1995, the Rail Unions filed a response in support of the BNR motion, and on
January 13, 1995, the Rail Unions filed their own, similar stay request. On
22
<PAGE> 23
January 12, 1995, Union Pacific filed an opposition to the BNR motion, and on
January 18, 1995, Union Pacific filed an opposition to the Rail Unions' stay
request.
On January 10, 1995, the Rail Unions filed a petition in the United States
Court of Appeals for the Tenth Circuit for review of the ICC's December 20, 1994
decision, and a motion for transfer of this review proceeding to the Third
Circuit.
On January 13, 1995, the Third Circuit issued an order denying the requests
of BNR and the Rail Unions for an injunction against Union Pacific and BNR's
motion for a stay pending judicial review of the ICC's December 20, 1994
decision, and dismissing as moot BNR's December 7, 1994 review petition and the
Rail Unions' December 12, 1994 mandamus petition.
CERTAIN LITIGATION CONCERNING
THE SANTA FE/BN MERGER -- RECENT DEVELOPMENTS
On January 18, 1995, Union Pacific and James A. Shattuck moved the Court of
Chancery in the State of Delaware for leave to file their Second Amended and
Supplemental Complaint (the "Second Amended Complaint"). In the proposed Second
Amended Complaint, the plaintiffs have withdrawn as moot their claims against
the original Santa Fe/BN Merger Agreement and have alleged, among other things,
that Santa Fe and members of Santa Fe's Board have breached their fiduciary
duties by (i) entering into the revised Santa Fe/BN Merger Agreement without
meeting their obligation to act reasonably to seek the transaction offering the
best value reasonably available to the stockholders in a sale of Santa Fe; (ii)
failing to implement fair and equal procedures for the acceptance and
consideration of competing bids for the purchase of Santa Fe; (iii) improperly
agreeing to the termination fee and expense reimbursement provisions of the
revised Santa Fe/BN Merger Agreement; and (iv) improperly adopting a
discriminatory stockholder rights plan in response to Union Pacific's tender
offer.
The Second Amended Complaint seeks an order of final judgment, inter alia
(a) requiring Santa Fe and Santa Fe's directors to adopt fair and equitable
procedures for the acceptance and consideration of competing bids for Santa Fe;
(b) enjoining the operation of the Rights pursuant to the Rights Plan and
declaring the Rights inapplicable or unenforceable as applied to the Amended
Cash Tender Offer and the Proposed Cash Merger; (c) declaring that the
termination fee and expense reimbursement provisions of the revised Santa Fe/ BN
Merger Agreement are invalid and unenforceable; and (d) declaring that Union
Pacific has not tortiously interfered with the contractual or other legal rights
of Santa Fe or BN.
SANTA FE/BN JOINT OFFER AND MERGER PROPOSAL
On December 23, 1994, Santa Fe and BN commenced the Joint Offer for up to
63,000,000 Shares (together with the associated Rights) at $20.00 per Share, net
to the tendering stockholder in cash, with Santa Fe severally obligated to
purchase up to 38,000,000 Shares and BN severally obligated to purchase up to
25,000,000 Shares pursuant to the Joint Offer upon the terms and subject to the
conditions set forth in the Joint Offer to Purchase.
According to the Joint Offer to Purchase, of the Shares tendered and
accepted for payment in the Joint Offer, Santa Fe is severally obligated to
purchase 60.3% of such Shares and BN is severally obligated to purchase 39.7% of
such Shares, subject to the terms and conditions of the Joint Offer. According
to the Joint
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<PAGE> 24
Offer to Purchase and the Santa Fe/BN Merger Agreement, Santa Fe plans to merge
into BN whereby the separate existence of Santa Fe will cease with BN continuing
as the surviving corporation, and each outstanding Share will be converted into
a right to receive 0.40 of a share of BN common stock. As of January 17, 1995,
the last full trading day prior to the date of this Second Supplement, 0.40 of a
share of BN common stock had a value of $21.05, based on the closing sales price
of BN common stock as reported on the New York Stock Exchange.
The Joint Offer is conditioned upon, among other things, (1) at least
63,000,000 Shares being validly tendered and not withdrawn before the expiration
of the Joint Offer, (2) Santa Fe and BN having obtained sufficient financing on
terms satisfactory to them to purchase 63,000,000 Shares pursuant to the Joint
Offer and (3) approval of the Santa Fe/BN Merger by the stockholders of Santa Fe
and BN.
------------------------------------
PLEASE SIGN, DATE AND MAIL THE ENCLOSED GOLD PROXY TODAY. NO POSTAGE IS
REQUIRED IF MAILED IN THE UNITED STATES. BY SIGNING AND MAILING THE ENCLOSED
GOLD PROXY, ANY PROXY PREVIOUSLY SIGNED BY YOU RELATING TO THE SUBJECT MATTER
HEREOF WILL BE AUTOMATICALLY REVOKED. VALIDLY EXECUTED GOLD PROXIES PREVIOUSLY
SOLICITED BY UNION PACIFIC WILL BE VOTED AT THE SPECIAL MEETING UNLESS REVOKED
PRIOR THERETO.
UNION PACIFIC CORPORATION
Dated: January 18, 1995
24
<PAGE> 25
ADDITIONAL INFORMATION
If your Shares of Santa Fe common stock are held in the name of a bank or
broker, only your bank or broker can vote your Shares of Santa Fe common stock
and only upon receipt of your specific instructions. Please instruct your bank
or broker to execute the GOLD proxy card today. If you have any questions or
require any assistance in voting your Shares of Santa Fe common stock, please
call:
MORROW & CO., INC.
Call Toll Free: (800) 662-5200
909 Third Avenue
New York, New York 10022
In New York City, call: (212) 754-8000
<PAGE> 1
Exhibit (g)(12)
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
- - - - - - - - - - - - - - - - X
:
UNION PACIFIC CORPORATION :
and JAMES A. SHATTUCK, :
:
Plaintiffs, :
:
v. :
: Civil Action No. 13778
SANTA FE PACIFIC CORPORATION, :
BILL M. LINDIG, ROY S. :
ROBERTS, JOHN S. RUNNELLS II, :
ROBERT H. WEST, JOSEPH F. :
ALIBRANDI, GEORGE DEUKMEJIAN, :
JEAN HEAD SISCO, ROBERT D. :
KREBS, MICHAEL A. MORPHY, :
EDWARD F. SWIFT, and :
BURLINGTON NORTHERN, INC., :
:
Defendants. :
:
- - - - - - - - - - - - - - - - X
SECOND AMENDED AND SUPPLEMENTAL COMPLAINT(1)
Plaintiffs, Union Pacific Corporation ("Union Pacific") and
James A. Shattuck, by their undersigned attorneys, by and for their second
amended and supplemental complaint, allege upon knowledge as to themselves and
- --------------------
1 Attached as Exhibit A hereto is a copy of this Second Amended and
Supplemental Complaint which, pursuant to Chancery Court Rule 15(aa), is
marked to indicate the differences between this document and the First
Amended and Supplemental Complaint filed in C.A. No. 13778 as follows:
new language appears in bold type and deletions are indicated by a caret.
<PAGE> 2
upon information and belief as to all other matters, as follows:
1. This action is brought for injunctive and declaratory
relief to address a wrongful course of conduct by defendants which is designed
to deprive Santa Fe Pacific Corporation ("Santa Fe") shareholders of the
opportunity to consider and receive a tender offer (the "Tender Offer") and
merger proposal from Union Pacific Corporation ("Union Pacific") amounting to
approximately $3.75 billion.
2. The transaction proposed by Union Pacific is superior
to the pending merger proposal from Burlington Northern Inc. ("Burlington
Northern") that has been endorsed as fair by Santa Fe's financial advisors,
particularly after discounting the Burlington Northern proposal for the time
delay in payment, the risk of non-consummation relating to the Interstate
Commerce Commission ("ICC") approval process and the uncertain value of the
Burlington Northern stock to be received by Santa Fe shareholders. Union
Pacific's proposed transaction -- unlike the proposed merger with Burlington
Northern -- is not contingent on approval by the ICC because, at Santa Fe's
insistence, it provides for a voting trust that would be independent of Union
Pacific in order to elimi-
2
<PAGE> 3
nate the regulatory risk for Santa Fe shareholders. By contrast, Burlington
Northern's proposal provides only limited non-contingent value to Santa Fe's
shareholders, through a partial tender offer mostly paid for by Santa Fe
itself.
3. Despite the superior value offered by Union Pacific
which can be immediately received by Santa Fe shareholders, the Santa Fe board
of directors (the "Board") consistently has refused, in breach of its fiduciary
duties under Delaware law, fairly and equally to consider Union Pacific's
superior bid to acquire Santa Fe, and instead has pursued a process that
improperly favors the preferred transaction with Burlington Northern. That
process is intended improperly to coerce Santa Fe's shareholders to approve the
proposed merger with Burlington Northern. The Board's conduct in this regard
includes (1) the Board's refusal to establish a fair and equal process for the
consideration of competing proposals to acquire Santa Fe, (2) the Board's
implementation of a poison pill rights plan to prevent Santa Fe shareholders
from receiving the benefit of Union Pacific's superior tender offer and merger
proposal, (3) the Board's approval of a "bust up" fee and expense reimbursement
provision designed to favor the Burlington
3
<PAGE> 4
Northern proposal, and (4) the Board's public expression of the implausible and
contradictory view that Santa Fe is not "for sale," despite the protracted
bidding contest to acquire Santa Fe, the Board's acknowledgement that their
fiduciary duties require them to negotiate with Union Pacific, and the Board's
approval of a "bust up" fee, which would only be justifiable in the context of
a fair and equitable sale process.
THE PARTIES
4. Plaintiff Union Pacific is a corporation organized
and existing under the laws of the State of Utah, with its principal office and
place of business at Eighth and Eaton Avenues, Bethlehem, Pennsylvania. Union
Pacific has been the owner of Santa Fe common stock since October 6, 1994.
5. Plaintiff James A. Shattuck has been, at all times
relevant to this action, and is the owner of Santa Fe common stock.
6. Burlington Northern is a corporation organized and
existing under the laws of the State of Delaware, with its principal office and
place of business at 777 Main Street, Fort Worth, Texas.
7. Santa Fe is a corporation organized and existing
under the laws of the State of Delaware, with
4
<PAGE> 5
its principal office and place of business at 1700 East Golf Road, Schaumburg,
Illinois.
8. Robert D. Krebs is Chairman of the Board of Directors,
President and Chief Executive Officer of Santa Fe.
9. The other directors of Santa Fe are defendants Bill
M. Lindig, Roy S. Roberts, John S. Runnells II, Robert H. West, Joseph F.
Alibrandi, George Deukmejian, Jean Head Sisco, Michael A. Morphy and Edward F.
Swift (collectively with Mr. Krebs, the "Director Defendants").
THE BURLINGTON NORTHERN-SANTA FE MERGER AGREEMENT
10. On June 29, 1994, defendants Burlington Northern and
Santa Fe entered into a merger agreement (the "Original Merger Agreement"),
which provided for the merger of Santa Fe with and into Burlington Northern
(the "BNI Merger"). Pursuant to the Original Merger Agreement, each Santa Fe
shareholder would receive .27 shares of Burlington Northern stock for each
share of Santa Fe stock, representing a value of $13.50 per Santa Fe share,
based on the closing price on October 4, 1994.
11. The Original Merger Agreement did not by its express
terms permit termination based on the fiduciary duty of the directors of Santa
Fe to secure and
5
<PAGE> 6
recommend to the stockholders of Santa Fe a later, better offer. Indeed, the
Santa Fe Board was advised by its counsel that it had no right to terminate the
Original Merger Agreement in order to facilitate a higher offer. Such advice
was -- on its face -- contrary to Delaware law, as recently expressed in
Paramount Communications v. QVC Network, Del. Supr., 637 A.2d 34 (1994).
THE BATTLE FOR SANTA FE
Union Pacific Triggers A
Bidding Contest For Santa Fe.
12. The Board of Directors of Union Pacific met on
October 5, 1994 and authorized the management of Union Pacific to pursue a
merger with Santa Fe. The Board authorized the proposal for a variety of valid
business reasons. Among these are that a merger with Union Pacific would
benefit the shareholders of Santa Fe, the shareholders of Union Pacific and
customers of the two companies by making a quantum leap towards a 21st century
transportation system.
13. The board of Union Pacific determined at its
October 5, 1994 meeting and at previous meetings that a combination of Union
Pacific and Santa Fe would produce major service improvements that a merger of
Burlington Northern and Santa Fe could not, including more new
6
<PAGE> 7
single-line service, and greater savings and efficiencies. The board of Union
Pacific also determined that a combination of Union Pacific and Santa Fe would
strengthen western rail competition in a way that a merger of Burlington
Northern and Santa Fe could not.
14. Later that same day, representatives of Union Pacific
met in Chicago with Mr. Krebs and counsel to Santa Fe to propose the merger of
Union Pacific and Santa Fe. The Union Pacific proposal provided that each
Santa Fe shareholder would receive .344 shares of Union Pacific stock, worth
approximately $18.00 per Santa Fe share. This represented a premium of 38%
over the then current market price of Santa Fe shares, and of 33% over the
value which they would receive for their shares in the Burlington Northern
transaction. Union Pacific's proposal was subject to the termination of the
Original Merger Agreement in accordance with its terms.
Santa Fe Refuses Even To Consider
Union Pacific's Initial Proposal.
15. The response of Santa Fe's representatives to Union
Pacific's initial proposal was instantaneous. Santa Fe's counsel, speaking on
behalf of Mr. Krebs and himself, stated that (i) the Original Merger Agreement
prohibited negotiations with Union Pacific; (ii) Union
7
<PAGE> 8
Pacific could not obtain ICC approval for any combination with Santa Fe; and
(iii) Santa Fe and Burlington Northern would bring suit for tortious
interference against both Union Pacific and its Chief Executive Officer,
personally, if Union Pacific's proposal was advanced.
16. Mr. Krebs' adamant, negative response was not
surprising. In violation of his fiduciary duty of loyalty to Santa Fe and its
stockholders, defendant Krebs primarily is promoting a merger with Burlington
Northern out of selfinterest, because he stands to become the CEO of the
combined Burlington Northern/Santa Fe enterprise.
17. Thus, without regard to the facts of Union Pacific's
proposal, without an examination of their fiduciary duties under the
circumstances, and apparently without prior review with the Santa Fe Board, Mr.
Krebs and his counsel responded for Santa Fe by rejecting Union Pacific's
initial proposal out of hand. This self-serving, uninformed, knee-jerk
reaction constituted a breach of the fiduciary duties of care and loyalty. But
this was only the beginning.
18. The Board then compounded Mr. Krebs' breaches of
fiduciary duty the very next day. Despite the superior value offered by Union
Pacific, and the complex issues before it, the Board hastily voted to
8
<PAGE> 9
reject Union Pacific's initial proposal without seeking any communication with,
or information from, Union Pacific. The Board did not even seriously consider
the Union Pacific proposal, choosing instead to rely solely on (i) the advice
of counsel that Santa Fe had no right to terminate the Original Merger
Agreement, which advice was incorrect as a matter of Delaware law; and (ii) the
self-serving "belief" of Mr. Krebs -- who will become the President and CEO of
the combined Burlington Northern/Santa Fe enterprise if the BNI Merger is
approved -- that the Union Pacific proposal would not get ICC approval and was
intended to prevent consummation of the BNI Merger.
Burlington Northern Increases
Its Bid And Union Pacific Tops It.
19. On October 27, 1994, Burlington Northern and Santa Fe
announced that they had amended the Original Merger Agreement (the "Amended
Merger Agreement") to increase the consideration offered to Santa Fe
shareholders from .27 shares to .34 shares of Burlington Northern stock for
each Santa Fe share exchanged, representing a total value of $17.00 per Santa
Fe share based on the closing price on October 27, 1994. Like the Original
Merger Agreement, the Amended Merger Agreement did not
9
<PAGE> 10
expressly permit termination based on the fiduciary duty of the directors of
Santa Fe to secure and recommend to the stockholders of Santa Fe a better
offer.
20. Three days later, Union Pacific topped Burlington
Northern's increased offer. In an October 30, 1994 letter to Mr. Krebs, Union
Pacific proposed to negotiate a tax-free merger in which Santa Fe shareholders
would receive .407 Union Pacific shares for each Santa Fe share, a value of
approximately $20 per Santa Fe share based on Union Pacific's October 28, 1994
closing price. The $20 per share proposal represented a 29% premium over the
closing price of Santa Fe common stock on October 28, and a 16.2% premium over
Burlington Northern's increased bid based on then current market prices. Union
Pacific also offered to pay a portion of the proposed consideration in cash.
The Santa Fe Board Again Refuses
Even To Consider Union Pacific's Proposal.
21. The Santa Fe Board swiftly rejected Union Pacific's
$20 per share proposal, again without bothering to consider it seriously.
Instead, as Mr. Krebs' November 2, 1994 letter to Union Pacific indicates, the
Santa Fe Board continued to rely solely on (i) Mr. Krebs' purported belief that
a Santa Fe/Union Pacific combina-
10
<PAGE> 11
tion "would not receive the required regulatory approval" and (ii) its
counsel's advice that if Santa Fe met with Union Pacific to discuss Union
Pacific's proposal, it would "run an unacceptable risk of breaching its
agreement with [Burlington Northern]." The November 2 letter also repeated the
Santa Fe Board's misleading promise that "if [Union Pacific] makes a proposal
at a fair price and with an adequate provision for a voting trust that would
substantially eliminate the regulatory risk for [Santa Fe] shareholders, the
Board would consider the proposal in light of its fiduciary duties."
Union Pacific's Tender Offer.
22. Thereafter, on November 8, 1994, Union Pacific's
board determined to force Santa Fe to "put its money where its mouth is." In a
November 8, 1994 letter to Mr. Krebs, Union Pacific stated:
You have repeatedly advised Union Pacific Corporation that if
it "make[s] a proposal at a fair price and with an adequate provision
for a voting trust that would substantially eliminate the regulatory
risk for SFP shareholders," your Board "would consider that proposal
in light of its fiduciary duties." We hereby submit just such a
proposal.
Using a voting trust, we propose acquiring all shares of Santa
Fe Pacific Corporation's common stock in a two-step transaction.
First, we would purchase approximately 57% of the shares outstanding
on a fully diluted basis in a cash tender offer for $17.50 per share.
We
11
<PAGE> 12
would then acquire the remaining SFP shares in a merger in which your
shareholders would receive, for each SFP share, a fraction of a UP
common share having a value of $17.50, based on the closing price of
UP common stock on November 8, 1994. The stock portion of the
consideration represents a ratio of .354 of a UP share for each SFP
share.
The value of our proposed transaction represents a premium of
17.6% over the closing price of SFP common stock on November 8, 1994.
Based on today's closing prices, the price would also be superior to
the value of the BN transaction that has been endorsed by your
financial advisors as fair to your shareholders. As discussed below,
our price represents a premium to that of the BN transaction, even
without factoring in the uncertainty of Interstate Commerce Commission
("ICC") approval of the BN transaction and the delay in payment of the
purchase price under that proposal.
Our proposed acquisition, unlike the BN transaction, would not
be contingent upon receipt of ICC approval for the acquisition. At
the time we consummate the tender offer and the merger, we would place
the shares of SFP common stock purchased by us into a voting trust
that would be independent of UP.
Our proposed structure would enable your shareholders to
receive immediate payment of the entire purchase price in the tender
offer and merger following satisfaction of the conditions to those
transactions, without your shareholders bearing any risk relating to
ICC approval of our combination with SFP. By contrast, the proposed
BN transaction provides for a delay of up to several years in payment
of any of the purchase price to SFP shareholders and requires your
shareholders to bear the entire ICC risk.
When your shareholders discount BN's purchase price for the
delay in payment and the ICC risk of non-consummation of the BN
transac-
12
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tion, the premium represented by our proposal is even greater.
On November 9, 1994, Union Pacific commenced the Tender Offer on the terms set
forth in its November 8, 1994 letter to Mr. Krebs.
Santa Fe's Board Finally Acknowledges Its Fiduciary
Duty To Negotiate With Union Pacific, But Adopts A
Discriminatory Poison Pill.
23. Santa Fe initially responded to the Tender Offer by
contriving yet another excuse to justify its refusal to negotiate. Santa Fe
complained that the Tender Offer was subject to the condition that the staff of
the ICC issue an opinion approving Union Pacific's use of a voting trust for
Santa Fe shares. On November 28, 1994, however, this last obstacle crumbled as
Union Pacific announced that it had received such approval from the ICC.
24. Santa Fe's Board met on the same day and, apparently
in fear that its shareholders might be tempted to accept Union Pacific's
clearly superior proposal (offering $4 or 30% more per share than the
consideration to be provided by Burlington Northern in the Original Merger
Agreement, which Santa Fe's financial advisors had declared to be fair to Santa
Fe's shareholders), the Board acted to deprive its stockholders of the power to
13
<PAGE> 14
accept the Tender Offer by adopting a "poison pill" rights plan (the "Poison
Pill").
25. The Poison Pill, provides, among other things, that
once a person, such as Union Pacific, acquires 10% or more of Santa Fe's common
stock, Santa Fe shareholders would have the right to receive, upon exercise of
the rights issued pursuant to the Poison Pill (the "Poison Pill Rights"),
common stock (or, in certain circumstances, cash, property or other securities
of Santa Fe) having a value equal to twice the exercise price of the Poison
Pill Rights.
26. Pursuant to the terms of the Poison Pill, the Board
retains the power to redeem the Poison Pill Rights for the cost of $.01 per
Right and, by this mechanism, has arrogated to itself the power to decide
whether or not its shareholders will have the ability to accept the benefits of
Tender Offer.
27. Burlington Northern, however, as Santa Fe's favored
merger partner, is expressly exempted from the disastrously dilutive effects
of the Poison Pill.
28. The Poison Pill is designed to and has the effect of
deterring any bid -- even a higher bid -- for Santa Fe except the one that the
Santa Fe Board has already chosen, the merger with Burlington Northern. Use
14
<PAGE> 15
of the Poison Pill against Union Pacific would cause massive dilution making it
impossible for Union Pacific to consummate its tender offer. The Poison Pill
was particularly designed to sabotage Union Pacific's tender offer and does not
provide any benefit to Santa Fe's shareholders.
29. The Poison Pill has a coercive effect on Santa Fe's
shareholders, inducing them to vote in favor of the merger between Santa Fe and
Burlington Northern rather than risk tendering to Union Pacific, which, due to
the Poison Pill, will be unable to purchase shares tendered to it.
Santa Fe Forecloses An Improved
Union Pacific Proposal By Refusing To
Adopt Fair And Equitable Bidding Procedures.
30. On the same day the Santa Fe Board adopted the Poison
Pill, it was advised by its counsel that it had a fiduciary duty to provide
information and to negotiate with Union Pacific. As a result of this advice,
the Santa Fe Board authorized its management to meet with Union Pacific "in
order to clarify and improve" Union Pacific's offer.
31. Over the next few weeks, representatives of Santa Fe
held discussions with representatives of Union Pacific ostensibly to discuss a
possible merger
15
<PAGE> 16
agreement, and Union Pacific was given access to financial information relating
to Santa Fe. Despite the fact that Union Pacific's proposal was at that point
by far the best on the table, Santa Fe repeatedly told Union Pacific that its
proposal was inadequate and that it should promptly improve its offer.
32. While disingenuously making these purported requests
for an improved bid, Santa Fe flatly refused to create a level playing field for
the acceptance and consideration of competing bids for the company. To protest
this unfairness, on December 14, 1994, Mr. Lewis wrote to Mr. Krebs as follows:
I am writing to advise you, as requested by your advisors, of
our position concerning our merger proposal.
Our response at this stage is a function of Santa Fe's having
pursued a flawed sale process. Your advisors have repeatedly
demanded that we improve our proposal while refusing to establish
any procedures for considering competing proposals on a fair and
equal basis. In fact, your advisors have frequently told us you
will not negotiate with Union Pacific unless we agree to pay at
least $20 per Santa Fe share. This position is clearly
inconsistent with your negotiating and recommending several
transactions with Burlington Northern at prices well below $20.
We believe our current proposal is an extremely attractive one
and in the best interests of Santa Fe and its shareholders and
customers. Despite this, you have continued to pursue a process
that favors any result other
16
<PAGE> 17
than a transaction with Union Pacific. We are prepared to
continue discussions with you, but we urge you to establish an
open sale process.
33. On December 16, 1994, Mr. Lewis again wrote to Mr.
Krebs expressing his extreme disappointment with the "flawed and biased sale
process" undertaken by Santa Fe. Mr. Lewis stated:
Let me be very clear. By your actions you have put Santa Fe
up for sale and Union Pacific is a very interested buyer. We want
to acquire Santa Fe by competing on an equal basis with Burlington
Northern and any other potential bidders. If Santa Fe establishes
a fair and open process, we would be eager to participate, and
would be willing to consider and discuss revisions to our
proposal.
34. At the same time, Union Pacific's legal and financial
advisors were expressing the same concerns to Santa Fe's advisors about the
unfairness of the bidding process. In a conference call on December 17, 1994,
Union Pacific's legal and financial advisors informed legal and financial
advisors for Santa Fe that Union Pacific wanted to be in a position to make an
improved proposal provided that Union Pacific be given an opportunity to bid
for Santa Fe on a fair and equal basis with Burlington Northern. Union
Pacific's advisors expressed the concern that Santa Fe had failed to establish
a fair and unbiased sale process. In particular, Union Pacific's advisors
objected to the fact that Santa Fe was
17
<PAGE> 18
informing Burlington Northern about communications between Union Pacific and
Santa Fe, including any revised acquisition proposal that Union Pacific might
make. Santa Fe refused to accept the procedure recommended by Union Pacific
and failed to adopt any alternative procedure for a fair sale.
35. The response of Mr. Krebs and his advisors --
astonishingly, after two months of an active, see-saw bidding war for purchase
of the entire company -- was to deny in a series of letters that Santa Fe was
"for sale," and to disavow any obligation to apply a fair and equitable process
for accepting bids. But even these letters themselves belied the "not for
sale" contention by imploring Mr. Lewis to "improve your proposal ... without
delay."
36. Mr. Krebs' pronouncements that Santa Fe is not for
sale are contradicted by Santa Fe's actions over the preceding several months.
Never before had Santa Fe told its shareholders that it was not interested in
engaging in a transaction with Union Pacific because the company was not "for
sale" -- rather, Santa Fe had always asserted that the Original Merger
Agreement precluded it from negotiating with Union Pacific, or that the Union
18
<PAGE> 19
Pacific proposal was illusory, because the ICC would not approve such a merger.
37. In fact, Santa Fe told its shareholders that in
rejecting Union Pacific's initial proposal, the Santa Fe board concluded that
"if the Original Merger Agreement were terminated and if the UPC proposal could
not be consummated, SFP would be left without a strategic combination which is
required to protect and enhance shareholder value." In other words, Santa Fe
told its shareholders that one of the key reasons for its refusal to negotiate
with Union Pacific was its supposed fear that such negotiations might lead to
an inability to sell the company at all. Santa Fe's later protestation that
the company is "not for sale" is flatly inconsistent with both its expressed
imperative to find a "strategic combination ... to protect and enhance
shareholder value" and its acknowledgement following November 28, 1994 that the
Santa Fe Board had a fiduciary duty to provide information to and negotiate
with Union Pacific with respect to Union Pacific's tender offer and merger
proposal.
Santa Fe Tries To Shut Down
The Bidding By Entering Into A Revised
Merger Agreement With Burlington Northern.
38. On December 18, 1994, in the face of Union Pacific's
repeatedly expressed willingness to consider
19
<PAGE> 20
improving its proposal if fair bidding procedures were implemented, Santa Fe
approved another revised merger agreement with Burlington Northern (the "Merger
Agreement"). The Merger Agreement provides for a two step acquisition of Santa
Fe by Burlington Northern, with the first step to be paid for mostly by Santa
Fe itself. Despite the Santa Fe Board's breaches of fiduciary duty in failing
to adopt procedures that would permit Union Pacific to participate fairly in
the bidding process, the Board also approved new "termination fee" and "expense
reimbursement" provisions, which, for the first time, promised Burlington
Northern a payment of $60 million if it lost the competition.
39. First, Santa Fe and Burlington Northern have jointly
offered to purchase 63 million shares, or approximately 33% of Santa Fe's
outstanding stock for $20 per share. Of this, 38 million shares, or 20% of
Santa Fe's stock is to be repurchased by Santa Fe, while 13% will be purchased
by Burlington Northern. As a result of this first step, Burlington Northern
will own approximately 16% of the remaining outstanding shares of Santa Fe.
40. At the earliest by mid-1996 and contingent upon ICC
approval of a merger of Santa Fe and Burlington
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Northern, the remaining shares of Santa Fe stock would each be exchanged for .4
shares of Burlington Northern stock, with a market value of $ 21.05 based on
the closing price on January 17, 1995. Because most of Santa Fe's shares will
not be purchased as part of the Merger Agreement unless the merger is approved
by the ICC, Santa Fe's shareholders bear the risk of disapproval. By contrast,
because of the voting trust Union Pacific already has in place, Santa Fe's
shareholders would bear none of the risk of ICC disapproval of a merger between
Santa Fe and Union Pacific.
41. As part of the Merger Agreement, Santa Fe has agreed
to pay a break up fee of $50 million and a maximum $10 million in expense
reimbursement in the event that the Merger Agreement is terminated for any
number of reasons, including a failure of the Santa Fe stockholders to approve
the Merger Agreement. Incredibly, even if it is the Burlington Northern
shareholders, not the Santa Fe shareholders, who disapprove the Merger
Agreement, Burlington Northern appears still to have the right to terminate the
Merger Agreement and collect its $60 million.
42. Santa Fe must pay the break up fee if anyone other
than Burlington Northern acquires 50% or
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more of Santa Fe common stock. Santa Fe must also pay the break up fee if the
Santa Fe Board cannot, in the exercise of its fiduciary duties, recommend the
merger with Burlington Northern, if Santa Fe or Burlington Northern
shareholders reject the Merger Agreement or even if the Santa Fe/Burlington
Northern tender offer is terminated.
43. The Santa Fe Board agreed to the $60 million in
termination fee and expense reimbursement payments in part to secure Burlington
Northern's agreement to the inclusion in the Merger Agreement of a new Section
10.1(xii) which, for the first time, gives the Board the right to terminate the
Merger Agreement in order to accept another takeover proposal. The Board's
approval of the Original Merger Agreement without such a clause was in breach
of its fiduciary duties of care and loyalty and threatened the Director
Defendants with personal liability.
44. Immediately after the terms of this new Merger
Agreement were announced, an unidentified Burlington Northern representative,
who would speak only on the condition of anonymity, was quoted in the press as
stating: "This is a carefully crafted plan designed to
22
<PAGE> 23
accomplish the merger and to make it prohibitively expensive for UP to top."
Union Pacific Again Responds
With A Superior Tender Offer.
45. On January 17, 1995, Union Pacific announced a
revised tender offer for all shares of Santa Fe stock. Union Pacific is
offering to purchase all shares of Santa Fe stock for $18.50 per share, with
the tendered shares to be placed in the voting trust pending ICC approval of a
merger between Union Pacific and Santa Fe. This proposal is significantly
superior to the Merger Agreement because, among other things, it allows Santa
Fe's stockholders to sell all of their shares for cash at a premium, and
without any delay or risk resulting from the regulatory process.
46. Union Pacific also announced that if the Merger
Agreement is not approved by Santa Fe's shareholders and the Santa Fe Board,
nevertheless, continues to refuse to negotiate a merger agreement with Union
Pacific, Union Pacific would purchase shares in the tender offer without a
merger agreement provided that Santa Fe shareholders tender at least 90 percent
of Santa Fe's outstanding shares. Union Pacific would then acquire the
remainder of the shares of Santa Fe stock by
23
<PAGE> 24
means of a "short form" merger pursuant to 8 Del. C. Section 253. In order to
proceed on such a unilateral basis, Union Pacific would first ask the ICC to
approve an amendment to the voting trust agreement that would enable the
trustee to cause Santa Fe, following the acquisition of Santa Fe shares by
Union Pacific, to cooperate with Union Pacific in obtaining ICC approval of a
Santa Fe/Union Pacific combination.
47. The revised Union Pacific tender offer is
conditioned, among other things, on the termination of the Merger Agreement in
accordance with its terms, Santa Fe stockholders not having approved the Merger
Agreement with Burlington Northern, and the redemption of the Poison Pill by
the Santa Fe Board or its modification or invalidation so as to render it
inapplicable to the acquisition of shares pursuant to the Union Pacific tender
offer and merger proposal.
SANTA FE'S POISON PILL THREATENS TO COERCE
ITS SHAREHOLDERS INTO VOTING FOR THE INFERIOR
BURLINGTON NORTHERN MERGER AGREEMENT
48. The adoption of the discriminatory Poison Pill by
Santa Fe's Board threatens to coerce Santa Fe's stockholders into accepting the
inferior Merger Agreement with Burlington Northern. The stockholders will know
that, with the pill in place, the Board has the power to
24
<PAGE> 25
carry out its threats to remain independent and deny the shareholders any
premium rather than merge with Union Pacific. Rather than risk losing a
premium, Santa Fe's shareholders will be coerced to vote for the inferior
Merger Agreement.
49. As long as the Poison Pill remains in place and the
Santa Fe Board continues to claim that the company is not for sale, this
coercion will make any shareholder vote approving the Merger Agreement invalid.
THE FIRST STEP OF THE PROPOSED MERGER AGREEMENT
THREATENS TO IRREPARABLY HARM SANTA FE'S
SHAREHOLDERS BY AN IRREVERSIBLE RESTRUCTURING
50. The first step of the proposed Merger Agreement would
involve the purchase of 33% of the outstanding stock of Santa Fe by Santa Fe
and Burlington Northern, in exchange for cash. This tender offer is
contingent upon approval of the Merger Agreement by Santa Fe's stockholders.
51. If the shareholders vote to approve the Merger
Agreement and the tendered shares are taken down, $760 million will have been
distributed from Santa Fe to thousands of shareholders, many, if not most of
whom would be beyond the jurisdiction of this Court. Even if the shareholders'
approval is later found to have been invalidly obtained and coerced by the
presence of the
25
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poison pill and the Santa Fe Board's breaches of fiduciary duty, that
transaction could never be undone.
COUNT I
-------
(Breach of Fiduciary Duties of
Loyalty and Care by the Director Defendants)
52. Plaintiffs repeat and reallege each of the preceding
paragraphs as if fully set forth here.
53. By virtue of their positions as directors of Santa
Fe, the Director Defendants owe fiduciary duties to Santa Fe and its
shareholders, and as a consequence, owed it and them the highest duty of good
faith and loyalty. That duty includes but is not limited to the obligation to
consider and fairly evaluate all offers for Santa Fe, the obligation to act
reasonably to seek the transaction offering the best value reasonably available
to the stockholders in a sale of the company, and the obligation not to put
self-interests and personal considerations of directors ahead of the interests
of Santa Fe's stockholders. The Director Defendants are also obligated to
conduct the affairs of Santa Fe with due care.
54. The refusal of the Director Defendants to implement
fair and equal procedures for the acceptance and consideration of competing
bids for purchase of the company and instead to follow a process known to
prevent
26
<PAGE> 27
or discourage Union Pacific from improving its proposal, even though Santa Fe
had been advised repeatedly that Union Pacific was prepared to make an improved
bid, was lacking in good faith, could not have been the product of a reasonable
inquiry and investigation, and unreasonably precludes a transaction offering
superior value to Santa Fe shareholders.
55. The Director Defendants have breached and are
threatening further to breach their fiduciary duties to Santa Fe and its
shareholders by refusing to negotiate with Union Pacific on a fair and equal
basis regarding its tender offer and merger proposal, which would provide
significantly higher value to Santa Fe's stockholders.
56. The Director Defendants have further breached their
fiduciary duties by purposefully engaging in a course of conduct intended to
coerce Santa Fe shareholders to vote in favor of the Santa Fe Board's preferred
transaction with Burlington Northern despite the superiority of the Union
Pacific tender offer and merger proposal. This course of conduct encompasses,
inter alia, (1) the Director Defendants' refusal to establish a fair and equal
process for the consideration of competing proposals to acquire Santa Fe, (2)
the Director Defendants' implementation of a poison pill rights plan
27
<PAGE> 28
to prevent Santa Fe shareholders from receiving the benefit of Union Pacific's
superior tender offer and merger proposal, (3) the Director Defendants'
approval of a "bust up" fee and expense reimbursement provision designed to
favor the Burlington Northern proposal, and (4) the Director Defendants' public
expression of the implausible and contradictory view that Santa Fe is not "for
sale," despite the protracted bidding contest to acquire Santa Fe, the Director
Defendants' acknowledgement that their fiduciary duties require them to
negotiate with Union Pacific, and the Director Defendants' approval of a "bust
up" fee, which would only be justifiable in the context of a fair and equitable
sale process.
57. Unless enjoined by this Court, the Director
Defendants will continue to breach their fiduciary duties to the detriment of
Santa Fe and its shareholders and Union Pacific.
58. Plaintiffs have no adequate remedy at law.
COUNT II
(Breach of Fiduciary Duties of Loyalty and Care
by the Director Defendants)
59. Plaintiffs repeat and reallege each of the preceding
paragraphs as if fully set forth here.
28
<PAGE> 29
60. By virtue of their positions as directors of Santa
Fe, the Director Defendants owe a fiduciary duty to the shareholders of Santa
Fe, which includes a duty not to take unreasonable defensive measures which are
not proportional to a threat posed to Santa Fe.
61. The Director Defendants have breached their fiduciary
duties of loyalty and care by adopting the Poison Pill, and are now threatening
to employ their Poison Pill to coerce the shareholders of Santa Fe into voting
to approve the inferior Merger Agreement and to prevent Santa Fe shareholders
from accepting the superior benefits of the Union Pacific tender offer and
merger proposal.
62. Unless enjoined, the Director Defendants will
continue improperly to employ the Poison Pill and pursue the Merger Agreement
with Burlington Northern in breach of their fiduciary duties of loyalty and
care.
63. Plaintiffs have no adequate remedy at law.
COUNT III
(Breach of Fiduciary Duties of Loyalty
and Care by the Director Defendants)
64. Plaintiffs repeat and reallege each of the preceding
paragraphs as if fully set forth here.
29
<PAGE> 30
65. By virtue of their positions as directors of Santa
Fe, the Director Defendants owe a fiduciary duty to the shareholders of Santa
Fe, which includes a duty not to take unreasonable defensive measures which are
not proportional to a threat posed by Santa Fe.
66. The Director Defendants have breached their fiduciary
duties of loyalty and care by approving an excessive break up fee and expense
reimbursement payments which must be paid to Burlington Northern if the Board's
favored proposal is not consummated. These payment provisions were approved to
relieve the Director Defendants of potential personal liability for having
first approved the Original Merger Agreement and the Amended Merger Agreement
without the inclusion in it of necessary and appropriate termination provisions
permitting them to fulfill their fiduciary duties under Delaware law. The
Director Defendants also breached their duties by agreeing to spend $760
million of Santa Fe's money in the joint tender offer with Burlington Northern,
the purpose of which is to make more likely the accomplishment of the Board's
favored deal with Burlington Northern, while depriving the Santa Fe
shareholders of the opportunity to consider or accept Union Pacific's superior
proposal.
30
<PAGE> 31
67. Unless enjoined, the Director Defendants will pursue
the Merger Agreement with Burlington Northern in breach of their fiduciary
duties of loyalty and care.
68. Plaintiffs have no adequate remedy at law.
COUNT IV
(Aiding and Abetting the Santa Fe Board's
Breach of Fiduciary Duties of Loyalty and
Care Against Burlington Northern)
69. Plaintiffs repeat and reallege each of the preceding
paragraphs as if fully set forth here.
70. By agreeing to pay excessive termination fee and
expense reimbursement payments of $60 million to Burlington Northern in
exchange for a right to exercise its fiduciary duties to terminate the Merger
Agreement in the event of a superior offer or in the event of stockholder
rejection of the Merger Agreement, the Santa Fe Board has breached its
fiduciary duties of loyalty and care.
71. Burlington Northern knowingly participated in the
Board's breach of its fiduciary duties by insisting on the provision for these
improper payments in the Merger Agreement.
72. Unless enjoined, Burlington Northern will continue to
aid and abet the Board's breaches of its fiduciary duties of loyalty and care.
31
<PAGE> 32
73. Plaintiffs have no adequate remedy at law.
COUNT V
(Declaratory Relief Against
Burlington Northern and Santa Fe)
74. Union Pacific repeats and realleges each of the
preceding paragraphs as if fully set forth here.
75. The validity and propriety of Union Pacific's actions
affects the rights and legal relations of Union Pacific, Burlington Northern
and Santa Fe, and the parties' interests are real and adverse.
76. Union Pacific has a legitimate interest in prompt
resolution of the validity and propriety of its actions and will suffer
unnecessary hardship from delay.
77. Union Pacific's actions in proposing a tender offer
and merger with Santa Fe were entirely justified because they were based on
demonstrable benefits of the merger proposal for Union Pacific, Santa Fe, and
the nation's railroad system.
78. Union Pacific's actions did not induce a breach of
the Original Merger Agreement and the Amended Merger Agreement by Santa Fe and
cannot induce a breach of the Merger Agreement because Union Pacific's tender
offer and merger proposal is subject to termination of such agreements in
accordance with their terms, and be-
32
<PAGE> 33
cause neither the Original Merger Agreement nor the Amended Merger Agreement
was breached by Santa Fe.
79. Accordingly, pursuant to 10 Del. C. Section 6501,
Union Pacific is entitled to a declaration that its actions in preparing and
proposing a tender offer and merger with Santa Fe have not tortiously
interfered with the contractual or other legal rights of Burlington Northern
and Santa Fe.
33
<PAGE> 34
WHEREFORE, plaintiffs pray for judgment as follows:
(a) Mandatorily enjoining Santa Fe to adopt fair and
equitable procedures for the acceptance and consideration of competing bids for
the company;
(b) Enjoining the operation of the Santa Fe Poison Pill
Rights or, alternatively, enjoining the Santa Fe Board to redeem such poison
pill rights or otherwise to render them inapplicable or unenforceable to the
Union Pacific tender offer and merger proposal;
(c) Declaring that the termination fee and expense
reimbursement payments of $60 million are invalid and unenforceable;
(d) Enjoining Burlington Northern from aiding and abetting
the Santa Fe Board's breaches of its fiduciary duties of loyalty and care;
(e) Declaring that Union Pacific has not tortiously
interfered with the contractual or other legal rights of the defendants;
(f) Enjoining the defendants from instituting, continuing
or maintaining any action in any other jurisdiction alleging, in whole or in
part, that Union Pacific has tortiously interfered with the contractual or
other legal rights of the defendants;
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<PAGE> 35
(g) Granting plaintiffs the costs of this action, including
reasonable attorneys' fees;
(h) Awarding such further relief and declaration of the rights and
legal relations of the parties to this action as the Court may deem
appropriate.
----------------------------
Stephen P. Lamb
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM
One Rodney Square
P.O. Box 636
Wilmington, DE 19899
(302) 651-3000
----------------------------
David J. Margules
KLEHR, HARRISON, HARVEY,
BRANZBURG & ELLERS
222 Delaware Avenue
Suite 1101
Wilmington, DE 19801
(302) 426-1189
Attorneys for Plaintiffs
Dated: January 18, 1995
35
