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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities and Exchange Act of 1934
(Amendment No. 9)*
Salomon Inc
(Name of Issuer)
Common Stock (upon conversion of Preferred Stock)
(Title of Class of Securities)
0007954981
(CUSIP Number)
Marc D. Hamburg
Berkshire Hathaway Inc.
1440 Kiewit Plaza
Omaha, Nebraska 68131
(402) 346-1400
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
November 22, 1996
(Date of Event which Requires
Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with the statement [ ]. (A fee
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities,
and for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the "Notes" to Schedule 13D).
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The following items of Schedule 13D filed by Berkshire Hathaway Inc.
("Berkshire") and the other persons filing this Schedule 13D with respect to
the Series A Cumulative Convertible Preferred Stock ("Preferred Stock") and the
Common Stock, $1.00 par value ("Common Stock") of Salomon Inc ("Salomon") are
amended as set forth below. As used herein, "Berkshire" refers collectively to
Berkshire and its subsidiaries that own of record shares of the Preferred Stock
and/or Common Stock.
ITEM 4. PURPOSE OF TRANSACTION.
Item 4 is amended by the following:
Berkshire previously reported on Schedule 13D that it was considering a
sale of Berkshire exchangeable notes, which would be exchangeable for Salomon
Common Stock upon maturity or redemption. Berkshire has now made the
appropriate filings with the Securities and Exchange Commission with respect to
such an offering, which filings have become effective. The transaction is
expected to be completed on December 2, 1996. It involves the sale of
$500,000,000 face amount of 1.00% Senior Exchangeable Notes Due December 2, 2001
(the "Notes").
The Notes are exchangeable for Salomon Common Stock at the exchange
rate of 17.65 shares of Salomon Common Stock per $1,000 Note, instead of the
face amount of the Note, if the market value of the Salomon Common Stock exceeds
the exchange price (which is the accreted value of the Note divided by the
exchange rate and initially is $51.43 per share) for specified periods prior to
maturity or specified dates of exchange. Such exchanges can occur at maturity
of the Notes, at the option of the holder at specified times each calendar
quarter, and at the option of Berkshire beginning December 2, 1999. The
exchange rate is subject to change in the event of splits of, and other changes
in, the Salomon Common Stock.
This Schedule 13D does not attempt or purport to set forth all of the
terms of the Notes, which are offered solely by means of the Prospectus for
such Notes.
The maximum number of shares of Salomon Common Stock that could be
deliverable by Berkshire in exchange for the Notes (assuming no stock split or
similar changes) is 8,825,000. If all such shares were to be transferred by
Berkshire in exchange for or redemption of the Notes, and assuming no other
purchases or sales of Salomon Common Stock by Berkshire, Berkshire's percentage
ownership of Salomon Common Stock (including Salomon Common Stock issuable upon
conversion of
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Salomon Preferred Stock) would be 10.4%.
Berkshire, at maturity or in an exchange initiated by it (but not in an
exchange initiated by a holder of the Notes), has the option to deliver an
equivalent amount of cash in lieu of the shares of Salomon Common Stock
otherwise deliverable. Thus, at those times, Berkshire is not required to
transfer any shares of Salomon Common Stock.
Berkshire has indicated to the underwriters of the Notes, however,
that its present intention would be to deliver Salomon Common Stock in exchange
for the Notes on those occasions when the terms of the Notes allow it to do so.
However, the Notes do not mature for five years (although they are exchangeable
at specified times beginning January 31, 1997 at the option of the holder, and
at Berkshire's option after three years), and such present intention is subject
to change at any time based on a variety of factors.
Salomon has a first right to purchase any Salomon securities that
Berkshire proposes to sell. Salomon has agreed to waive its right with respect
to the shares of Salomon Common Stock that Berkshire may deliver upon exchange
of the Notes.
All other information responsive to Item 4 remains as previously
reported, except as amended hereby.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUES.
Item 6 is amended by the following:
Berkshire, Salomon and Salomon Brothers Inc (a subsidiary of Salomon),
along with the other underwriters of the Notes, Goldman Sachs & Co. and Smith
Barney Inc., have executed an Underwriting Agreement with respect to the
offering of the Notes. This Agreement includes certain indemnities by and
between Berkshire and Salomon, and an undertaking by Salomon, with certain
limitations, to utilize reasonable efforts to cause a registration statement to
be effective during periods when the Notes are exchangeable at the option of
the holders, in order to permit Berkshire to deliver a prospectus to such
holders with shares of Salomon Common Stock if it determines to do so in such
exchange.
Berkshire and Salomon have also executed a Waiver Agreement pursuant
to which Salomon waives its first refusal right to purchase as described in
Item 4 above.
Berkshire and State Street Bank and Trust Company (as successor trustee
to The First National Bank of Boston), as Trustee, have entered into an
Indenture dated December 1, 1987, as amended by the First Supplemental Indenture
dated as of December 2, 1996, which Indenture governs the terms of the Notes.
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ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Underwriting Agreement by and among Berkshire Hathaway Inc., Salomon
Inc, Salomon Brothers Inc, Goldman, Sachs & Co. and Smith Barney Inc. dated
November 26, 1996.*
Waiver agreement by and between Salomon Inc and Berkshire Hathaway
Inc.
Indenture by and between Berkshire Hathaway Inc. and State Street Bank
and Trust Company (as successor to The First National Bank of Boston),
Trustee, dated December 1, 1987**
First Supplemental Indenture by and between Berkshire Hathaway Inc.
and State Street Bank and Trust Company, Trustee, dated as of December 2, 1996.*
* Incorporated by reference from Berkshire Hathaway's Form 8-K filed
November 29, 1996
** Incorporated by reference from Berkshire Hathaway's Registration Statement
on Form S-3 (file no. 33-30570)
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After reasonable inquiry and to the best knowledge and belief of each,
the undersigned hereby certify that the information set forth in this statement
is true, complete, and correct.
Dated this 27th day of November, 1996.
/S/WARREN E. BUFFETT
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Warren E. Buffett
BERKSHIRE HATHAWAY INC. NATIONAL INDEMNITY COMPANY
By/S/ WARREN E. BUFFETT BY/S/ WARREN E. BUFFETT
- ----------------------------- -----------------------------
Warren E. Buffett Warren E. Buffett
Chairman of the Board Chairman of the Board
NATIONAL FIRE AND MARINE COLUMBIA INSURANCE COMPANY
INSURANCE COMPANY
By/S/ WARREN E. BUFFETT BY/S/ WARREN E. BUFFETT
- ----------------------------- -----------------------------
Warren E. Buffett Warren E. Buffett
Chairman of the Board Chairman of the Board
CYPRESS INSURANCE COMPANY, CORNHUSKER CASUALTY COMPANY, OAK RIVER INSURANCE
COMPANY, NATIONAL LIABILITY & FIRE INSURANCE COMPANY, WESCO-FINANCIAL INSURANCE
COMPANY, and WESCO FINANCIAL CORPORATION.
By/S/ WARREN E. BUFFETT
-----------------------------
Warren E. Buffett
Attorney-in-Fact
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EXHIBIT INDEX
1. Underwriting Agreement by and among Berkshire Hathaway Inc., Salomon Inc,
Salomon Brothers Inc, Goldman, Sachs & Co. and Smith Barney Inc. dated
November 26, 1996.*
4.1 Indenture by and between Berkshire Hathaway Inc. and State Street Bank and
Trust Company (as successor trustee to The First National Bank of Boston,
Trustee, dated December 1, 1987.**
4.2 First Supplemental Indenture by and between Berkshire Hathaway Inc. and
State Street Bank and Trust Company, Trustee, dated as of December 2, 1996.*
99 Waiver Agreement by and between Salomon Inc and Berkshire Hathaway Inc.
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* Incorporated by reference from Berkshire Hathaway's Form 8-K filed November
29, 1996
** Incorporated by reference from Berkshire Hathaway's Registration Statement
on Form S-3 (file no. 33-30570).
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EXHIBIT 99
WAIVER dated as of November 26, 1996 (this "Waiver") to
the Purchase Agreement dated September 28, 1987, between
Berkshire and the Company (the "Purchase Agreement").
A. Berkshire Hathaway Inc. ("Berkshire") has filed with the Securities
and Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended (the "Act"), a registration statement (No. 33-30570) on Form S-3 (as
amended by Post-Effective Amendment No. 1 and Post-Effective Amendment No. 2
thereto) and a related registration statement pursuant to Rule 462(b) under the
Act (collectively, the "Berkshire Registration Statement"), and will next file
with the Commission a final prospectus supplement (the "Berkshire Supplement")
pursuant to Rule 424(b) under the Act, relating to a public offering by
Berkshire of its Senior Exchangeable Notes due 2001 (the "Berkshire
Exchangeable Notes") in an aggregate principal amount of $440,000,000
($500,000,000 if the underwriters' over-allotment option is exercised in
full). The Berkshire Exchangeable Notes may be exchanged at Berkshire's
option, at maturity or upon redemption, or, at the holder's option, during
certain periods, as described in the Berkshire Supplement, for shares of common
stock, par value $1.00 per share, of the Company (the "Common Stock") at an
exchange rate of 17.65 shares of Common Stock per Note (subject to certain
anti-dilution adjustments as described in the Berkshire Supplement),
representing an initial exchange price of $51.43 per share of Common Stock;
B. At the request of Berkshire pursuant to the Purchase Agreement, the
Company has filed with the Commission under the Act a registration statement
(No. 333-11881) on Form S-3 (as amended by Amendment No. 1 and Amendment No. 2
thereto) and a related registration statement pursuant to Rule 462(b) under the
Act, and will next file with the Commission a final prospectus supplement
pursuant to Rule 424(b) under the Act, with respect to up to 7,766,000 shares
(8,825,000 shares if the underwriters' over-allotment option is exercised in
full) of Common Stock (subject to certain anti-dilution adjustments as
described in the Berkshire Supplement) that may be deliverable by Berkshire in
exchange for the Berkshire Exchangeable Notes in accordance with the terms of
such Notes;
C. Pursuant to Section (1)(b)(iii) of the Purchase Agreement,
Berkshire agreed that it will not sell any Company securities owned by it to a
third party without first giving the Company or its designee a reasonable
opportunity to purchase such securities at the same price and on the same terms
and conditions proposed with respect to an anticipated sale by Berkshire to a
third party (the "Right of First Refusal"); and
D. Berkshire has advised the Company that the offering of the
Berkshire Exchangeable Notes is contingent upon its receipt from the Company of
a waiver of the Right of First Refusal with respect to any delivery by
Berkshire of shares of Common Stock in exchange for any such Notes in
accordance with the terms of such Notes.
SECTION 1. Waiver. The Company hereby waives the Right of First
Refusal with respect to any delivery by Berkshire of shares of Common Stock in
exchange for any Berkshire Exchangeable Notes sold pursuant to the Berkshire
Supplement in accordance
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with the terms of such Notes, provided that the aggregate number of shares so
delivered does not exceed 7,766,000 shares (8,825,000 shares if the
underwriters' over-allotment option is exercised in full), subject to certain
anti-dilution adjustments as described in the Berkshire Supplement.
SECTION 2. Effect of Waiver. Except as expressly set forth herein,
this Waiver shall not by implication or otherwise limit, impair, constitute a
waiver of, or otherwise affect the rights and remedies of the Company or
Berkshire under the Purchase Agreement, and shall not alter, modify, amend or in
any way affect any of the terms, conditions, obligations, covenants or
agreements contained in the Purchase Agreement. Nothing herein shall be deemed
to entitle Berkshire to a consent to, or a waiver, amendment, modification or
other change of, any of the terms, conditions, obligations, covenants or
agreements contained in the Purchase Agreement in similar or different
circumstances.
SECTION 3. Governing Law. THIS WAIVER SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the undersigned has caused this Waiver to be duly
executed by an authorized officer as of the day and year first above written.
Very truly yours,
SALOMON INC
by /s/ ROBERT E. DENHAM
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Name: Robert E. Denham
Title: Chairman and Chief Executive
Officer
Accepted and Agreed:
BERKSHIRE HATHAWAY INC.
by /s/ MARC D. HAMBURG
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Name: Marc D. Hamburg
Title: Vice President
