UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 18, 1994
BURLINGTON NORTHERN RAILROAD COMPANY
(Exact name of registrant as specified in its charter)
Delaware 1-6324 41-6034000
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
3800 Continental Plaza, 777 Main Street, Fort Worth, Texas 76102
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (817) 333-2000
(Former name or former address, if changed since last report)
Item 5. Other Events
Burlington Northern Railroad Company is a wholly owned subsidiary of
Burlington Northern Inc. ("BNI"). As of December 18, 1994, BNI and Santa
Fe Pacific Corporation ("Santa Fe") entered into an Amendment No. 2
("Amendment No. 2") to the Agreement and Plan of Merger dated as of June
29, 1994 between BNI and Santa Fe, as previously amended as of October 26,
1994 (the "Agreement") pursuant to which on the terms and conditions set
forth in the Agreement, as amended by the Amendment No. 2, Santa Fe will
merge (the "Merger") with and into BNI, and BNI will be the surviving
corporation. Pursuant to Amendment No. 2, BNI and Santa Fe will effect a
tender offer for certain Santa Fe shares and the exchange ratio in the
Merger will increase from 0.34 shares of BNI common stock per share of
Santa Fe common stock to 0.40 shares of BNI common stock per share of Santa
Fe common stock, as well as other changes. Amendment No. 2 is attached
hereto as Exhibit 2.1, and the description thereof set forth herein is
qualified in its entirety by reference to Amendment No. 2. On December 18,
1994, BNI issued a press release attached hereto as Exhibit 99.1
announcing, among other things, the execution of the Amendment No. 2.
Consummation of the Merger is subject to approval by the stockholders of
BNI and Santa Fe, approval by the Interstate Commerce Commission, approval
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, and other
customary conditions.
Item 7(c). Exhibits
Exhibit 2.1 -- Amendment No. 2 dated as of December 18, 1994 between
Burlington Northern Inc. ("BNI") and Santa Fe Pacific Corporation ("Santa
Fe") to Agreement and Plan of Merger dated as of June 29, 1994 between BNI
and Santa Fe.
Exhibit 99.1 -- Press Release of Burlington Northern Inc. dated December 18,
1994.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereto duly authorized.
BURLINGTON NORTHERN
RAILROAD COMPANY
/s/ Douglas J. Babb
___________________________________
Douglas J. Babb
Vice President and
General Counsel
Date: December 23, 1994
EXHIBITS INDEX
Sequentially
Exhibits Numbered Page
Exhibit 2.1 Amendment No. 2 dated as of December 18, 1994 between
Burlington Northern Inc. ("BNI") and Santa Fe Pacific
Corporation ("Santa Fe") to Agreement and Plan of Merger
dated as of June 29, 1994 as amended on October 26, 1994
between BNI and Santa Fe.
Exhibit 99.1 Press Release of Burlington Northern Inc. dated
December 18, 1994.
EXHIBIT 2.1
CONFORMED COPY
AMENDMENT NO. 2
to
AGREEMENT AND PLAN OF MERGER
AMENDMENT NO. 2 dated as of December 18, 1994 (this "Amendment")
between Burlington Northern Inc., a Delaware corporation ("BNI"), and Santa Fe
Pacific Corporation, a Delaware corporation ("SFP").
WHEREAS, BNI and SFP have previously entered into that certain
Agreement and Plan of Merger dated as of June 29, 1994 between BNI and SFP, as
amended by the Amendment thereto dated as of October 26, 1994 (as so amended,
the "Merger Agreement"); and
WHEREAS, the respective Boards of Directors of BNI and SFP have
determined that it is in the best interests of BNI or SFP, as the case may be,
and its respective stockholders to further amend the Merger Agreement as
hereinafter set forth and have duly approved this Amendment No. 2 and
authorized its execution and delivery.
NOW, THEREFORE, the parties hereto agree as follows:
1. All capitalized terms used herein, unless otherwise defined
herein, shall have the meanings given them in the Merger Agreement,
and each reference in the Merger Agreement to "this Agreement",
"hereof", "herein", "hereunder" or "hereby" and each other similar
reference shall be deemed to refer to the Merger Agreement as amended
hereby. All references to the Merger Agreement in any other
agreement between BNI and SFP relating to the transactions
contemplated by the Merger Agreement shall be deemed to refer to the
Merger Agreement as amended hereby.
2. Section 1.2(a)(i) of the Merger Agreement is hereby amended
by deleting the number "0.34" wherever such number appears therein
and inserting in its place the number "0.40".
3. Section 3.3 of the Merger Agreement is hereby amended by
inserting the words "the Offer and" after the phrase "the
consummation of" therein.
4. Section 3.5 of the Merger Agreement is hereby amended by
(i) inserting the words ", except for the Offer" after the phrase
"SFP Securities" in the last sentence of Section 3.5(a), (ii)
deleting the phrase "12,000,000 shares were reserved for issuance
pursuant to the SFP Long-Term Incentive Stock Plan, of which
5,281,405 were available for grant and" and (iii) adding the
following new sentence after the second sentence of Section 3.5(a):
As of May 31, 1994, a total of 12,000,000 shares of SFP Common
Stock were approved for awards under the SFP Long-Term Incentive
Stock Plan, of which 5,281,405 remain available for grant.
5. Section 3.9 of the Merger Agreement is hereby amended by
replacing subparagraph (a) of such section in its entirety with the
following:
<PAGE>
(a) Each document required to be filed by SFP with the
SEC in connection with the transactions contemplated by this
Agreement (the "SFP Disclosure Documents"), including, without
limitation, (i) the SFP Offer Documents to be filed with the
SEC in connection with the Offer and (ii) the definitive proxy
statement of SFP (the "SFP Proxy Statement") to be filed with
the SEC in connection with the Merger, and any amendments or
supplements thereto, will, when filed, comply as to form in all
material respects with the applicable requirements of the
Exchange Act. At the time the offer to purchase and form of
related letter of transmittal contained in the SFP Offer
Documents or any amendment or supplement thereto are first
mailed to stockholders of SFP and at the time of consummation
of the Offer, the SFP Offer Documents, as supplemented or
amended, if applicable, will not contain any untrue statement
of a material fact or omit to state any material fact necessary
to make the statements made therein, in light of the
circumstances under which they were made, not misleading. At
the time the SFP Proxy Statement or any amendment or supplement
thereto is first mailed to stockholders of SFP and at the time
such stockholders vote on adoption of this Agreement, the SFP
Proxy Statement, as supplemented or amended, if applicable,
will not contain any untrue statement of a material fact or
omit to state any material fact necessary in order to make the
statements made therein, in light of the circumstances under
which they were made, not misleading. At the time of the
filing of any SFP Disclosure Document other than the SFP Offer
Documents and the SFP Proxy Statement and at the time of any
distribution thereof, such SFP Disclosure Document will not
contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
made therein, in light of the circumstances under which they
were made, not misleading. The representations and warranties
contained in this Section 3.9(a) will not apply to statements
or omissions included in SFP Disclosure Documents based upon
information furnished to SFP in writing by BNI specifically for
use therein.
6. Section 3.10 of the Merger Agreement is hereby amended by
replacing such section in its entirety with the following:
SECTION 3.10. Information Supplied. The information
supplied or to be supplied by SFP for inclusion or
incorporation by reference in (i) the BNI Offer Documents or
any amendment or supplement thereto will not, at the time the
offer to purchase and form of related letter of transmittal
contained in the BNI Offer Documents or any amendment or
supplement thereto are first mailed to stockholders of SFP and
at the time of the consummation of the Offer, contain any untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in
light of the circumstances under which they were made, not
misleading, (ii) the BNI Proxy Statement or any amendment or
supplement thereto will not, at the time the BNI Proxy
Statement is first mailed to stockholders of BNI and at the
time such stockholders vote on adoption of this Agreement,
contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make the
statements made therein, in light of the circumstances under
which they were made, not misleading, (iii) any BNI Disclosure
<PAGE>
Document (other than the BNI Offer Documents and the BNI Proxy
Statement) will not, at the time of effectiveness of such BNI
Disclosure Document and at the time of any distribution thereof
contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
made therein, in light of the circumstances under which they
were made, not misleading, and (iv) the Form S-4 (as defined in
Section 7.3(a)) will not, at the time the Form S-4 becomes
effective under the 1933 Act and at the Effective Time, contain
any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements made
therein, in light of the circumstances under which they were
made, not misleading.
7. Section 3.13 of the Merger Agreement is hereby amended by
inserting the words ", and except as set forth in the Joint Proxy
Statement/Prospectus of SFP and BNI dated October 12, 1994 and the
Supplemental Joint Proxy Statement/Prospectus thereto dated October
28, 1994," after the phrase "SFP Form 10-Q" therein.
8. The Merger Agreement is hereby amended by adding the
following as a new Section 3.23:
SECTION 3.23. SFP Rights Agreement. Under the Rights
Agreement between SFP and First Chicago Trust Company of New
York, as Rights Agent, dated as of November 28, 1994 (the "SFP
Rights Agreement"), BNI will not become an "Acquiring Person",
no "Shares Acquisition Date" or "Distribution Date" (as such
terms are defined in the SFP Rights Agreement) will occur, and
SFP's shareholders will not be entitled to receive any benefits
under the SFP Rights Agreement as a result of the approval,
execution or delivery of this Agreement, the commencement or
consummation of the Offer or the consummation of the Merger.
9. Section 4.3 of the Merger Agreement is hereby amended by
inserting the words "the Offer and" after the phrase "the
consummation of" therein.
10. Section 4.9 of the Merger Agreement is hereby amended by
replacing such section in its entirety with the following:
SECTION 4.9. Disclosure Documents. Each document
required to be filed by BNI with the SEC in connection with the
transactions contemplated by this Agreement (the "BNI Disclosure
Documents"), including, without limitation, (i) the BNI Offer
Documents to be filed with the SEC in connection with the Offer
and (ii) the definitive proxy statement of BNI (the "BNI Proxy
Statement") to be filed with the SEC in connection with the
Merger, and any amendments or supplements thereto, will, when
filed, comply as to form in all material respects with the
applicable requirements of the Exchange Act. At the time the
offer to purchase and form of related letter of transmittal
contained in the BNI Offer Documents or any amendment or
supplement thereto are first mailed to stockholders of SFP and
at the time of consummation of the Offer, the BNI Offer
Documents, as supplemented or amended, if applicable, will not
contain any untrue statement of a material fact or omit to
state any material fact necessary to make the statements made
therein, in light of the circumstances under which they were
made, not misleading. At the time the BNI Proxy Statement or
<PAGE>
any amendment or supplement thereto is first mailed to
stockholders of BNI and at the time such stockholders vote on
adoption of this Agreement, the BNI Proxy Statement, as
supplemented or amended, if applicable, will not contain any
untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements made
therein, in light of the circumstances under which they were
made, not misleading. At the time of the filing of any BNI
Disclosure Document other than the BNI Offer Documents and the
BNI Proxy Statement and at the time of any distribution
thereof, such BNI Disclosure Document will not contain any
untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements made therein, in
light of the circumstances under which they were made, not
misleading. The representations and warranties contained in
this Section 4.9 will not apply to statements or omissions
included in BNI Disclosure Documents based upon information
furnished to BNI in writing by SFP specifically for use
therein.
11. Section 4.10 of the Merger Agreement is hereby amended by
replacing such section in its entirety with the following:
SECTION 4.10. Information Supplied. The information
supplied or to be supplied by BNI for inclusion or
incorporation by reference in (i) the SFP Offer Documents or
any amendment or supplement thereto will not, at the time the
offer to purchase and form of related letter of transmittal
contained in the SFP Offer Documents or any amendment or
supplement thereto are first mailed to stockholders of SFP and
at the time of the consummation of the Offer, contain any untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in
light of the circumstances under which they were made, not
misleading, (ii) the SFP Proxy Statement or any amendment or
supplement thereto will not, at the time the SFP Proxy
Statement is first mailed to stockholders of SFP and at the
time such stockholders vote on adoption of this Agreement,
contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make the
statements made therein, in light of the circumstances under
which they were made, not misleading and (iii) any SFP
Disclosure Document (other than the SFP Offer Documents and the
SFP Proxy Statement) will not, at the time of effectiveness of
such SFP Disclosure Document and at the time of any
distribution thereof contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make
the statements made therein, in light of the circumstances
under which they were made, not misleading.
12. Section 4.13 of the Merger Agreement is hereby amended by
inserting the words ", and except as set forth in the Joint Proxy
Statement/Prospectus of SFP and BNI dated October 12, 1994 and the
Supplemental Joint Proxy Statement/Prospectus thereto dated October
28, 1994," after the phrase "BNI Form 10-Q" therein.
13. Section 5.1 of the Merger Agreement is hereby amended by
(i) inserting the words "the Offer," after the phrase "Except for" in
subparagraph (b) thereof, and (ii) replacing subparagraph (f) thereof
in its entirety with the following:
<PAGE>
(f) Except for (i) borrowings under existing credit
facilities, replacements therefor and refinancings thereof,
(ii) borrowings not to exceed $1.75 billion in the aggregate
under credit facilities in form and substance reasonably
satisfactory to BNI to finance the Offer, to refinance SFP's
currently outstanding 12.65% Senior Notes due October 1, 2000,
8 3/8% Notes due November 1, 2001 and 8 5/8% Notes due November
1, 2004, to pay penalties, premiums and make-whole payments
required in connection with such refinancing and for working
capital and other corporate purposes, (iii) borrowings in the
ordinary course of business consistent with past practice or
(iv) borrowings that are Customary Actions, SFP will not, and
will not permit any Subsidiary of SFP to, incur any
indebtedness for borrowed money or guarantee any such
indebtedness;
14. The final sentence of Section 5.8 is hereby amended to
read in its entirety as follows:
As used in this Agreement, "Takeover Proposal" when used in
connection with any Person shall mean any tender or exchange
offer involving such Person, any proposal for a merger,
consolidation or other business combination involving such
Person or any Subsidiary of such Person, any proposal or offer
to acquire in any manner a substantial equity interest in, or a
substantial portion of the assets of, such Person or any
Subsidiary of such Person, any proposal or offer with respect
to any recapitalization or restructuring with respect to such
Person or any Subsidiary of such Person or any proposal or
offer with respect to any other transaction similar to any of
the foregoing with respect to such Person or any Subsidiary of
such Person other than pursuant to the transactions to be
effected pursuant to this Agreement.
15. The Merger Agreement is hereby amended by adding the
following as a new Section 5.9:
SECTION 5.9. Registration Rights. SFP hereby grants BNI
the registration and other rights set forth in Annex II hereto,
which rights shall become effective without any action by any
Person in the event that this Agreement is terminated for any
reason after consummation of the Offer.
16. Section 6.1 of the Merger Agreement is hereby amended by
inserting the words "the Offer and" after the phrase "Except for" in
subparagraph (b) thereof.
17. Section 6.1 of the Merger Agreement is hereby amended by
replacing subparagraph (f) thereof in its entirety with the following:
(f) Except for (i) borrowings under existing credit
facilities, replacements therefor and refinancings thereof, (ii)
borrowings not to exceed $500 million in the aggregate under
credit facilities in form and substance reasonably satisfactory
to SFP to finance the Offer (iii) borrowings in the ordinary
course of business consistent with past practice or (iv)
borrowings that are Customary Actions, BNI will not, and will
not permit any Subsidiary of BNI to, incur any indebtedness for
borrowed money or guarantee any such indebtedness;
<PAGE>
18. Section 6.1 of the Merger Agreement is hereby amended by
replacing subparagraph (g) thereof in its entirety with the following:
(g) Except for loans, advances, capital contributions or
investments made in the ordinary course of business consistent
with past practice, except for loans, advances, capital
contributions or investments that are Customary Actions and,
except for loans, advances, capital contributions or
investments for the purchase of shares of SFP Common Stock
pursuant to the Offer, BNI will not, and will not permit any
Subsidiary of BNI to, make any loans, advances or capital
contributions to, or investments in, any other Person (other
than to BNI or any Subsidiary of BNI);
19. Article VIII of the Merger Agreement is hereby amended by
replacing such article in its entirety with the following:
ARTICLE VIII
THE OFFER
SECTION 8.1. The Offer. (a) Provided that nothing
shall have occurred that would result in a failure to satisfy
any of the conditions set forth in Annex I hereto, SFP and BNI
shall, as promptly as practicable, but in no event later than
December 23, 1994, commence separate tender offers (together,
the "Offer") to purchase, in the case of SFP, up to 38,000,000
shares of SFP Common Stock and, in the case of BNI, up to
25,000,000 shares of SFP Common Stock (in each case, together
with the associated rights under the SFP Rights Plan), at a
price of $20.00 per share, net to the seller in cash, with SFP
to be severally obligated to purchase 0.60317 of any shares of
SFP Common Stock accepted for payment pursuant to the Offer and
BNI severally obligated to purchase 0.39683 of any shares of
SFP Common Stock accepted for payment pursuant to the Offer.
Notwithstanding any provision of this Agreement (or any Annex
hereto) to the contrary, no term of the Offer may be amended or
modified without the written consent of both parties hereto.
(b) The several obligations of BNI and SFP under the
Offer shall be subject to the condition that there shall be
validly tendered in accordance with the terms of the Offer
prior to the expiration date of the Offer and not withdrawn
63,000,000 shares of SFP Common Stock and to the other
conditions set forth in Annex I hereto. Each of SFP and BNI
expressly reserves the right to waive any of the conditions to
its obligation under the Offer, except that the Minimum
Condition may not be waived without the consent of each of SFP
and BNI. Furthermore, each of SFP and BNI shall have the right
to determine, in its sole reasonable discretion, whether the
conditions to its obligations under the Offer have been
satisfied.
(c) As soon as practicable on the date of commencement
of the Offer, SFP shall file with the SEC an Issuer Tender
Offer Statement on Schedule 13E-4 with respect to the Offer
which will contain the offer to purchase and form of the related
letter of transmittal (together with any supplements or
amendments thereto, collectively the "SFP Offer Documents").
<PAGE>
SFP and BNI each agrees promptly to correct any information
provided by it for use in the SFP Offer Documents if and to the
extent that it shall have become false or misleading in any
material respect. BNI and its counsel shall be given an
opportunity to review and comment on the Schedule 13E-4 prior to
its being filed with the SEC.
(d) As soon as practicable on the date of commencement
of the Offer, BNI shall file with the SEC a Tender Offer
Statement on Schedule 14D-1 with respect to the Offer which
will contain the offer to purchase and form of the related
letter of transmittal (together with any supplements or
amendments thereto, collectively the "BNI Offer Documents").
BNI and SFP each agrees promptly to correct any information
provided by it for use in the BNI Offer Documents if and to the
extent that it shall have become false or misleading in any
material respect. SFP and its counsel shall be given an
opportunity to review and comment on the Schedule 14D-1 prior
to its being filed with the SEC.
(e) Upon satisfaction (or, where permitted, waiver) of the
conditions to the Offer, BNI and SFP shall purchase shares of
SFP Common Stock pursuant to the Offer as set forth in Section
8.1(a) above, provided, however, that BNI shall not be
obligated to purchase more than 25,000,000 shares of SFP Common
Stock, and SFP shall not be obligated to purchase more than
38,000,000 shares of SFP Common Stock.
SECTION 8.2. Action by SFP and BNI. (a) SFP represents
that its Board of Directors at a meeting duly called and held
unanimously resolved to recommend acceptance of the Offer by
those of its stockholders who wish to receive cash for a
portion of their shares of SFP Common Stock. SFP and BNI agree
to take all steps necessary to cause the offer to purchase and
form of the related letter of transmittal to be disseminated to
holders of shares of SFP Common Stock as and to the extent
required by applicable federal securities laws.
(b) As soon as practicable on the day that the Offer is
commenced, SFP will file with the SEC a
Solicitation/Recommendation Statement on Schedule 14D-9 (the
"Schedule 14D-9") which shall reflect the recommendations of
SFP's Board of Directors with respect to the Offer described in
Section 8.2(a). SFP and BNI each agree promptly to correct any
information provided by it for use in the Schedule 14D-9 if and
to the extent that it shall have become false or misleading in
any material respect. SFP agrees to take all steps necessary
to cause the Schedule 14D-9 as so corrected to be filed with
the SEC and to be disseminated to holders of shares of SFP
Common Stock, in each case as and to the extent required by
applicable federal securities laws. BNI and its counsel shall
be given an opportunity to review and comment on the Schedule
14D-9 prior to its being filed with the SEC.
20. Section 9.1 of the Merger Agreement is hereby amended as
follows:
(a) Clause (vi) of Section 9.1 of the Merger Agreement
is amended to read in its entirety as follows:
<PAGE>
(vi) SFP and BNI shall have obtained an opinion of
nationally recognized tax counsel to the effect that the Merger
will be tax-free to BNI, SFP and their respective stockholders
for federal income tax purposes;
(b) Clause (vii) is amended to read in its entirety as
follows:
(vii) SFP and BNI shall have purchased shares of SFP
Common Stock pursuant to the Offer.
(c) The phrase "except that the condition set forth in
clause (vii) may not be waived" is added after the phrase
"conditions exist" and before the phrase ") of" in the first
clause of Section 9.1.
21. Section 10.1 of the Merger Agreement is hereby amended by
(a) deleting the "and" at the end of clause (x), (b) replacing the
"." at the end of clause (xi) with a ";" and (c) adding the following
new clauses (xii) and (xiii);
(xii) by SFP, upon payment to BNI of the fee described
in Section 11.4(b), if prior to the purchase of shares of SFP
Common Stock pursuant to the Offer, (A) the board of directors
of SFP shall have withdrawn or modified in a manner adverse to
BNI its approval or recommendation of the Offer, this Agreement
or the Merger in order to permit SFP to execute a definitive
agreement in connection with a Takeover Proposal or in order to
approve another tender offer for shares of SFP Common Stock, in
either case, as determined by the board of directors of SFP, on
terms more favorable to SFP's stockholders than the transactions
contemplated hereby, or (B) the board of directors of SFP shall
have recommended any other Takeover Proposal; and
(xiii) by either BNI or SFP, if the Offer is terminated
and SFP and BNI shall not have purchased shares of SFP Common
Stock pursuant to the Offer.
22. Section 10.2 of the Merger Agreement is hereby amended by
inserting the section number ", 5.9" after the reference to section
"4.16" therein.
23. Section 11.4 of the Merger Agreement is hereby amended by
replacing such section in its entirety with the following:
Section 11.4. Expenses; Certain Payments. (a) Except as
otherwise provided in this Section or agreed in writing by the
parties, each party shall bear its own expenses, including the
fees and expenses of any attorneys, accountants, investment
bankers, brokers, finders or other intermediaries or other
Persons engaged by it, incurred in connection with this
Agreement and the transactions contemplated hereby.
(b) SFP agrees that if this Agreement shall be
terminated pursuant to Section 10.1(v), (vii), (viii), (xii) or
(xiii), 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 this Agreement, the Merger, the Offer
and all related transactions by wire transfer of immediately
available funds promptly, but in no event later than two
<PAGE>
business days, after such termination; provided that no payment
will be required pursuant to this Section 11.4(b) if this
Agreement is terminated pursuant to Section 10.1(vii), (viii)
or (xiii) unless, after the date hereof, a new Takeover
Proposal involving SFP has been announced or made (it being
understood that any modification of Union Pacific Corporation's
Takeover Proposal in existence on the date hereof shall be
deemed a new Takeover Proposal).
(c) SFP agrees that if this Agreement shall be
terminated pursuant to Section 10.1(vii), (viii) or (xiii) and
no payment is required by it pursuant to Section 11.4(b), it
will reimburse BNI for all out-of-pocket expenses incurred by
BNI in connection with this Agreement, the Merger, the Offer
and all related transactions. Such payment shall be made by
wire transfer of immediately available funds promptly, but in
no event later than two business days, after receipt by SFP from
BNI of documentation of such expenses.
24. The Merger Agreement is hereby amended by adding as Annex
I thereto the following:
ANNEX I
CONDITIONS TO THE OFFER
Notwithstanding any other provision of the Offer, neither SFP
nor BNI shall be required to accept for payment or pay for any shares
of SFP Common Stock, and may terminate or amend its obligation to
purchase shares of SFP Common Stock under the Offer or may postpone
the acceptance for payment of and payment for shares of SFP Common
Stock, if (i) at least 63,000,000 shares of SFP Common Stock shall
not have been tendered and not withdrawn pursuant to the Offer (the
"Minimum Condition"), (ii) this Agreement shall not have been adopted
by the stockholders of SFP and BNI in accordance with Delaware Law,
(iii) the applicable waiting period under the HSR Act shall not have
expired or been terminated, (iv) BNI (in the case of SFP) and SFP (in
the case of BNI) shall not have accepted (or shall not concurrently
accept) shares of SFP Common Stock for payment under the Offer or (v)
at any time on or after the date of this Agreement and prior to the
acceptance for payment of shares of SFP Common Stock, any of the
following conditions exist:
(a) any court, arbitrator or governmental body, agency
or official shall have issued any order, or there shall be any
statute, rule or regulation, restraining or prohibiting the
consummation of the Offer or the Merger or the effective
operation of the business of BNI, SFP and their respective
Subsidiaries after the Effective Time; or
(b) any actions by or in respect of or filings with any
governmental body, agency, official, or authority required to
permit the consummation of the Offer (other than with respect
to the HSR Act) or the Merger (other than ICC approval) shall
not have been obtained, but excluding any consent, approval,
clearance or confirmation the failure to obtain which could not
reasonably be expected to have a Material Adverse Effect on the
Surviving Corporation after the Effective Time; or
<PAGE>
(c) SFP (in the case of BNI) or BNI (in the case of SFP)
shall have failed to perform in any material respect any of its
respective obligations under this Agreement required to be
performed by it at or prior to the consummation of the Offer,
or the representations and warranties of SFP (in the case of
BNI) or BNI (in the case of SFP) shall not have been accurate
in all material respects both when made and at and as of any
time prior to the consummation of the Offer as if made at and as
of such time, except for the representations and warranties of
SFP and BNI in Sections 3.5(a) and 4.5(a), respectively, of the
Agreement, which shall be accurate in all respects when made
and at and as of any time prior to the consummation of the
Offer as if made at and as of that time; or
(d) the Agreement shall have been terminated in
accordance with its terms; or
(e) (i) SFP shall not be satisfied, in its sole
discretion, that it has obtained sufficient financing to enable
it to satisfy its obligations under the Offer and to effect the
other transactions referred to in Section 5.1(f)(ii), or (ii)
BNI shall not be satisfied, in its sole discretion, that it has
obtained sufficient financing to enable it to satisfy its
obligations under the Offer (it being understood that each of
SFP and BNI will use its reasonable best efforts to ensure that
this condition to its obligations under the Offer is satisfied
no later than December 31, 1994).
which, in the sole judgment of SFP or BNI in any such case, and
regardless of the circumstances (including any action or omission by
SFP or BNI) giving rise to any such condition, makes it inadvisable
to proceed with such acceptance for payment or payment; provided that
the Minimum Condition may be waived only with the consent of each of
BNI and SFP.
25. The Merger Agreement is hereby amended by adding as Annex
II thereto the following:
ANNEX II
REGISTRATION RIGHTS
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. The following terms, as used
herein, have the following meanings:
"Affiliate" of any Person means any other Person directly
or indirectly controlling or controlled by or under common
control with such Person. For the purposes of this definition,
"control" when used with respect to any Person, means the
possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such
Person, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
<PAGE>
"Demand Registration" means a Demand Registration as
defined in Section 2.2.
"Piggy-Back Registration" means a Piggy-Back Registration
as defined in Section 2.3.
"Registrable Securities" means the shares of SFP Common
Stock purchased by BNI pursuant to the Offer until (i) a
registration statement covering such SFP Common Stock has been
declared effective by the Commission and it has been disposed of
pursuant to such effective registration statement, (ii) such
SFP Common Stock is sold under circumstances in which all of
the applicable conditions of Rule 144 (or any similar provisions
then in force) under the 1933 Act are met, (iii) such SFP
Common Stock may be sold without registration pursuant to Rule
144(k) or (iv) such SFP Common Stock has been otherwise
transferred, SFP has delivered a new certificate or other
evidence of ownership for such SFP Common Stock not bearing the
legend required pursuant to this Agreement and such SFP Common
Stock may be resold without subsequent registration under the
1933 Act.
"Underwriter" means a securities dealer who purchases any
Registrable Securities as principal and not as part of such
dealer's market-making activities.
ARTICLE II
REGISTRATION RIGHTS
SECTION 2.1. Demand Registration. (a) Request for
Registration. At any time or from time to time after the
termination of the Agreement, BNI may make a written request for
registration under the 1933 Act of all or part of its
Registrable Securities (a "Demand Registration"); provided,
that the SFP shall not be obligated to effect more than two
Demand Registrations in total with respect to such issue of
Registrable Securities. Such request will specify the number
of shares of Registrable Securities proposed to be sold and
will also specify the intended method of disposition thereof.
(b) Effective Registration. A registration will not
count as a Demand Registration until it has become effective.
(c) Managing Underwriting; Additional Demand
Registrations. If BNI shall so elect, the offering of such
Registrable Securities pursuant to such Demand Registration
shall be in the form of an underwritten offering. BNI shall
select the book-running managing Underwriter in connection with
such offering and any additional investment bankers and
managers to be used in connection with the offering; provided
that such managing Underwriter and additional investment
bankers and managers must be reasonably satisfactory to SFP.
To the extent Registrable Securities so requested to be
registered are excluded from the offering in accordance with
Section 2.3, BNI shall have the right to one additional Demand
Registration under this Section with respect to such Registrable
Securities.
<PAGE>
SECTION 2.2. Piggy-Back Registration. If at any time
SFP proposes to file a registration statement under the 1933
Act with respect to an offering by SFP for its own account or
for the account of any of its respective securityholders of any
class of security (other than a registration statement on Form
S-4 or S-8 (or any substitute form that may be adopted by the
Commission or a registration filed), or filed in connection
with an exchange offer or offering of securities solely to
SFP's existing securityholders) then SFP shall give written
notice of such proposed filing to BNI as soon as practicable
(but in no event less than 10 days before the anticipated
filing date), and such notice shall offer BNI the opportunity
to register such number of shares of Registrable Securities as
BNI may request (a "Piggy-Back Registration"). SFP shall use
its reasonable best efforts to cause the managing Underwriter
or Underwriters of a proposed underwritten offering to permit
the Registrable Securities requested to be included in a
Piggy-Back Registration to be included on the same terms and
conditions as any similar securities of SFP included therein.
SECTION 2.3. Reduction of Offering. Notwithstanding
anything contained herein, if the managing Underwriter or
Underwriters of an offering described in Section 2.1 or 2.2
deliver a written opinion to BNI that the size of the offering
that is intended to be made is such that the success of the
offering would be materially and adversely affected by
inclusion of all of the Registrable Securities requested to be
included, then the amount of securities to be offered for the
account of BNI shall be reduced to the extent necessary to
reduce the total amount of securities to be included in such
offering to the amount recommended by such managing Underwriter
or Underwriters; provided that, in the case of a Piggy-Back
Registration, if securities are being offered for the account
of other persons or entities as well as SFP, then with respect
to the Registrable Securities intended to be offered by BNI,
the proportion by which the amount of such class of securities
intended to be offered by BNI is reduced shall not exceed the
proportion by which the amount of such class of securities
intended to be offered by such other persons or entities is
reduced.
ARTICLE III
REGISTRATION PROCEDURES
SECTION 3.1. Filings; Information. Whenever BNI
requests that any Registrable Securities be registered pursuant
to Section 2.1 hereof, SFP will use its reasonable best efforts
to effect the registration of such Registrable Securities in
accordance with the intended method of disposition thereof as
quickly as practicable, and in connection with any such request:
(a) SFP will as expeditiously as reasonably practicable
prepare and file with the SEC a registration statement on any
form for which SFP then qualifies or which counsel for SFP
shall deem appropriate and which form shall be available for
the sale of the Registrable Securities to be registered
thereunder in accordance with the intended method of
<PAGE>
distribution thereof, and use its reasonable best efforts to
cause such filed registration statement to become and remain
effective for a period of not less than 270 days; provided that
if SFP shall furnish to BNI a certificate signed by either its
Chairman or the Vice Chairman stating that in his good faith
judgment it would be significantly disadvantageous to SFP or
its shareholders for such a registration statement to be filed
as expeditiously as reasonably practicable, SFP shall have a
period of not more than 90 days within which to file such
registration statement measured from the date of receipt of the
request in accordance with Section 2.1.
(b) SFP will, if requested, prior to filing a
registration statement or prospectus or any amendment or
supplement thereto, furnish to BNI and each Underwriter, if
any, of the Registrable Securities covered by such registration
statement copies of such registration statement as proposed to
be filed, and thereafter furnish to BNI and such Underwriter,
if any, such number of copies of such registration statement,
each amendment and supplement thereto (in each case including
all exhibits thereto and documents incorporated by reference
therein), the prospectus included in such registration
statement (including each preliminary prospectus) and such
other documents as BNI or such Underwriter may reasonably
request in order to facilitate the disposition of the
Registrable Securities owned by BNI.
(c) After the filing of the registration statement, SFP
will promptly notify BNI of any stop order issued or threatened
by the SEC and take all reasonable actions required to prevent
the entry of such stop order or to remove it if entered.
(d) SFP will use its reasonable best efforts to (i)
register or qualify the Registrable Securities under such other
securities or blue sky laws of such jurisdictions in the United
States as BNI reasonably (in light of BNI's intended plan of
distribution) requests and (ii) cause such Registrable
Securities to be registered with or approved by such other
governmental agencies or authorities in the United States as
may be necessary by virtue of the business and operations of
SFP and do any and all other acts and things that may be
reasonably necessary or advisable to enable BNI to consummate
the disposition of the Registrable Securities owned by BNI;
provided that SFP will not be required to (A) qualify generally
to do business in any jurisdiction where it would not otherwise
be required to qualify but for this paragraph (d), (B) subject
itself to taxation in any such jurisdiction or (C) consent to
general service of process in any such jurisdiction.
(e) SFP will immediately notify BNI, at any time when a
prospectus relating thereto is required to be delivered under
the 1933 Act, of the occurrence of an event requiring the
preparation of a supplement or amendment to such prospectus so
that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus will not contain an
untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make
the statements therein not misleading and promptly make
available to BNI any such supplement or amendment.
<PAGE>
(f) SFP will enter into customary agreements (including
an underwriting agreement in form customary for SFP) and take
such other actions as are reasonably required in order to
expedite or facilitate the disposition of such Registrable
Securities.
(h) Subject, in the case of BNI, to the Confidentiality
Agreement between BNI and SFP dated as of July 28, 1993 or, in
the case of any Underwriter or Inspector retained by any
Underwriter, customary confidentiality obligations, SFP will
make available for inspection by BNI, any Underwriter
participating in any disposition pursuant to such registration
statement and any attorney, accountant or other professional
retained by BNI or such Underwriter (collectively, the
"Inspectors"), all financial and other records, pertinent
corporate documents and properties of SFP (collectively, the
"Records") as shall be reasonably necessary to enable them to
exercise their due diligence responsibility, and cause SFP's
officers, directors and employees to supply all information
reasonably requested by any Inspectors in connection with such
registration statement.
(i) SFP will furnish to BNI and to each Underwriter, if
any, a signed counterpart, addressed to BNI or such
Underwriter, of (i) an opinion or opinions of counsel to SFP
and (ii) a comfort letter or comfort letters from SFP's
independent public accountants, each in form customary in
primary offerings by SFP form and covering such matters of the
type customarily covered by opinions or comfort letters, as the
case may be, as BNI or the managing Underwriter reasonably
requests.
(j) SFP will otherwise use its reasonable best efforts to
comply with all applicable rules and regulations of the SEC,
and make available to its security-holders, as soon as
reasonably practicable, its most recent quarterly earnings
statement beginning with the first full quarter after the
effective date of the registration statement, which earnings
statement shall satisfy the provisions of Section 11(a) of the
1933 Act and Rule 158 under the 1933 Act.
(k) SFP will use its reasonable best efforts to cause all
such Registrable Securities to be listed on each securities
exchange on which similar securities of the same class issued
by SFP are then listed.
SFP may require BNI to promptly furnish in writing to SFP
such information regarding the distribution of the Registrable
Securities as SFP may from time to time reasonably request and
such other information as may be legally required in connection
with such registration.
BNI agrees that, upon receipt of any notice from SFP of
the happening of any event of the kind described in Section
3.1(e) hereof, BNI will forthwith discontinue disposition of
Registrable Securities pursuant to the registration statement
covering such Registrable Securities until BNI's receipt of the
copies of the supplemented or amended prospectus contemplated
by Section 3.1(e) hereof, and, if so directed by SFP, BNI will
deliver to SFP all copies, other than permanent file copies
<PAGE>
then in BNI's possession, of the most recent prospectus
covering such Registrable Securities at the time of receipt of
such notice. In the event SFP shall give such notice, SFP shall
extend the period during which such registration statement
shall be maintained effective (including the period referred to
in Section 3.1(a) hereof) by the number of days during the
period from and including the date of the giving of notice
pursuant to Section 3.1(e) hereof to the date when SFP shall
make available to BNI a prospectus supplemented or amended to
conform with the requirements of Section 3.1(e) hereof.
SECTION 3.2. Registration Expenses. In connection with
any registration statement required to be filed hereunder, SFP
shall pay the following registration expenses incurred in
connection with the registration hereunder (the "Registration
Expenses"): (i) all registration and filing fees, (ii) fees
and expenses of compliance with securities or blue sky laws
(including reasonable fees and disbursements of counsel in
connection with blue sky qualifications of the Registrable
Securities), (iii) printing expenses, (iv) internal expenses
(including, without limitation, all salaries and expenses of
its officers and employees performing legal or accounting
duties), (v) the fees and expenses incurred in connection with
the listing of the Registrable Securities, (vi) reasonable fees
and disbursements of counsel for SFP and customary fees and
expenses for independent certified public accountants retained
by SFP (including the expenses of any comfort letters or costs
associated with the delivery by independent certified public
accountants of a comfort letter or comfort letters requested
pursuant to Section 3.1(h) hereof), and (vii) the reasonable
fees and expenses of any special experts retained by SFP in
connection with such registration. SFP shall have no
obligation to pay any underwriting fees, discounts or
commissions attributable to the sale of Registrable Securities,
or any out-of-pocket expenses of BNI or its Underwriters (or
the agents who manage their accounts).
ARTICLE IV
INDEMNIFICATION AND CONTRIBUTION
SECTION 4.1. Indemnification by SFP. SFP agrees to
indemnify and hold harmless BNI, its officers, directors and
agents, and each Person, if any, who controls BNI within the
meaning of Section 15 of the 1933 Act or Section 20 of the
Exchange Act from and against any and all losses, claims,
damages and liabilities caused by any untrue statement or
alleged untrue statement of a material fact contained in any
registration statement or prospectus relating to the
Registrable Securities (as amended or supplemented if SFP shall
have furnished any amendments or supplements thereto) or any
preliminary prospectus, or caused by any omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission
or alleged untrue statement or omission based upon information
furnished in writing to SFP by BNI or on BNI's behalf expressly
for use therein; provided, however, that the foregoing indemnity
<PAGE>
agreement with respect to any preliminary prospectus shall not
inure to the benefit of BNI, its officers, directors and
agents, and each Person, if any, who controls BNI within the
meaning of Section 15 of the 1933 Act or Section 20 of the
Exchange Act if it is determined that it was the responsibility
of BNI to provide such person with a current copy of the
prospectus and such current copy of the prospectus would have
cured the defect giving rise to such loss, claim, damage or
liability. SFP also agrees to indemnify any Underwriters of
the Registrable Securities, their officers and directors and
each person who controls such underwriters on substantially the
same basis as that of the indemnification of BNI provided in
this Section 4.1.
SECTION 4.2. Indemnification by BNI. BNI agrees to
indemnify and hold harmless SFP, its officers, directors and
agents and each Person, if any, who controls SFP within the
meaning of either Section 15 of the 1933 Act or Section 20 of
the Exchange Act to the same extent as the foregoing indemnity
from SFP to BNI, but only with reference to information
relating to BNI furnished in writing by BNI or on BNI's behalf
expressly for use in any registration statement or prospectus
relating to the Registrable Securities, or any amendment or
supplement thereto, or any preliminary prospectus. In case any
action or proceeding shall be brought against SFP or its
officers, directors or agents or any such controlling person,
in respect of which indemnity may be sought against BNI, BNI
shall have the rights and duties given to SFP, and SFP or its
officers, directors or agents or such controlling person shall
have the rights and duties given to BNI, by the preceding
paragraph. BNI also agrees to indemnify and hold harmless
Underwriters of the Registrable Securities, their officers and
directors and each person who controls such Underwriters on
substantially the same basis as that of the indemnification of
SFP provided in this Section 4.2.
SECTION 4.3. Conduct of Indemnification Proceedings. In
case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which
indemnity may be sought pursuant to Section 4.1 or 4.2, such
person (an "Indemnified Party") shall promptly notify the
person against whom such indemnity may be sought "Indemnifying
Party") in writing and the Indemnifying Party shall assume the
defense thereof, including the employment of counsel reasonably
satisfactory to such Indemnified Party, and shall assume the
payment of all fees and expenses. In any such proceeding, any
Indemnified Party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at
the expense of such Indemnified Party unless (i) the
Indemnifying Party and the Indemnified Party shall have
mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded
parties) include both the Indemnified Party and the
Indemnifying Party and representation of both parties by the
same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the
Indemnifying Party shall not, in connection with any proceeding
or related proceedings in the same jurisdiction, be liable for
the reasonable fees and expenses of more than one separate firm
of attorneys (in addition to any local counsel) at any time for
<PAGE>
all such Indemnified Parties, and that all such fees and
expenses shall be reimbursed as they are incurred. In the case
of any such separate firm for the Indemnified Parties, such
firm shall be designated in writing by the Indemnified Parties.
The Indemnifying Party shall not be liable for any settlement
of any proceeding effected without its written consent, but if
settled with such consent, or if there be a final judgment for
the plaintiff, the Indemnifying Party shall indemnify and hold
harmless such Indemnified Parties from and against any loss or
liability (to the extent stated above) by reason of such
settlement or judgment. Notwithstanding the foregoing
sentence, if at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel as contemplated by the
third sentence of this paragraph, the indemnifying party agrees
that it shall be liable for any settlement of any proceeding
effected without its written consent if (i) such settlement is
entered into more than 30 business days after receipt by such
indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified
party in accordance with such request prior to the date of such
settlement. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement
of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity
could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of
such indemnified party from all liability arising out of such
proceeding.
SECTION 4.4. Contribution. If the indemnification
provided for in this Article 4 is unavailable to the
Indemnified Parties in respect of any losses, claims, damages
or liabilities referred to herein, then each such Indemnifying
Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified
Party as a result of such losses, claims, damages or
liabilities (i) as between SFP and BNI on the one hand and the
Underwriters on the other, in such proportion as is appropriate
to reflect the relative benefits received by SFP and BNI on the
one hand and the Underwriters on the other from the offering of
the securities, or if such allocation is not permitted by
applicable law, in such proportion as is appropriate to reflect
not only the relative benefits but also the relative fault of
SFP and BNI on the one hand and of the Underwriters on the
other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations and (ii) as
between SFP on the one hand and BNI on the other, in such
proportion as is appropriate to reflect the relative fault of
SFP and of BNI in connection with such statements or omissions,
as well as any other relevant equitable considerations. The
relative benefits received by SFP and BNI on the one hand and
the Underwriters on the other shall be deemed to be in the same
proportion as the total proceeds from the offering (net of
underwriting discounts and commissions but before deducting
expenses) received by SFP and BNI bear to the total
underwriting discounts and commissions received by the
Underwriters, in each case as set forth in the table on the
cover page of the prospectus. The relative fault of SFP and
<PAGE>
BNI on the one hand and of the Underwriters on the other shall
be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates
to information supplied by SFP and BNI or by the Underwriters.
The relative fault of SFP on the one hand and of BNI on the
other shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material
fact relates to information supplied by such party, and the
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
SFP and BNI agree that it would not be just and equitable
if contribution pursuant to this Section 4.4 were determined by
pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of
allocation which does not take account of the equitable
considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an Indemnified Party
as a result of the losses, claims, damages or liabilities
referred to in the immediately preceding paragraph shall be
deemed to include, subject to the limitations set forth above,
any legal or other expenses reasonably incurred by such
Indemnified Party in connection with investigating or defending
any such action or claim. Notwithstanding the provisions of
this Section 4.4, no Underwriter shall be required to
contribute any amount in excess of the amount by which the
total price at which the securities underwritten by it and
distributed to the public were offered to the public exceeds
the amount of any damages which such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission, and BNI shall not be
required to contribute any amount in excess of the amount by
which the total price at which BNI's securities were offered to
the public exceeds the amount of any damages which BNI has
otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such
fraudulent misrepresentation.
ARTICLE V
MISCELLANEOUS
SECTION 5.1. Participation in Underwritten
Registrations. No Person may participate in any underwritten
registration filed pursuant to Section 2.1 hereunder unless
such Person (a) agrees to sell such Person's securities on the
basis provided in any underwriting arrangements approved by the
Persons entitled hereunder to approve such arrangements and (b)
completes and executes all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents
reasonably required under the terms of such underwriting
arrangements and these registration rights.
SECTION 5.2. Rule 144. SFP covenants that it will file
<PAGE>
any reports required to be filed by it under the Exchange Act
and that it will take such further action as BNI may reasonably
request, all to the extent required from time to time to enable
BNI to sell Registrable Securities without registration under
the 1933 Act within the limitation of the exemptions provided
by (a) Rule 144 under the 1933 Act, as such Rule may be
amended from time to time, or (b) any similar rule or
regulation hereafter adopted by the SEC. Upon the request of
BNI, SFP will deliver to BNI a written statement as to whether
it has complied with such requirements.
SECTION 5.3. Holdback Agreements. (a) Restrictions on
Public Sale by BNI. To the extent not inconsistent with
applicable law, when BNI's securities are included in a
registration statement, BNI agrees not to effect any public
sale or distribution of SFP Common Stock, or any securities
convertible into or exchangeable or exercisable for such
securities, including a sale pursuant to Rule 144 under the
1933 Act, during the 14 days prior to, and during the 90-day
period beginning on, the effective date of such registration
statement (except as part of such registration), if and to the
extent requested by SFP in the case of a non-underwritten public
offering or if and to the extent requested by the managing
Underwriter or Underwriters in the case of an underwritten
public offering.
(b) Restrictions on Public Sale by SFP and Others. SFP
agrees not to effect any public sale or distribution of any
securities of the class being registered in accordance with
Section 2.1 hereof, or any securities convertible into or
exchangeable or exercisable for such securities, during the 14
days prior to, and during the 90-day period beginning on, the
effective date of any registration statement (except as part of
such registration statement where BNI consents) or the
commencement of a public distribution of Registrable
Securities, including a sale pursuant to Rule 144 under the
1933 Act (except as part of any such registration, if
permitted); provided, however, that the provisions of this
paragraph (b) shall not prevent the conversion or exchange of
any securities pursuant to their terms into or for other
securities or sales or distributions pursuant to any dividend
or interest reinvestment plan or director or employer
compensation plan.
26. A new Section 1.8 is hereby added to the Merger Agreement
as follows:
Section 1.8. Alternative Transaction Structure. (a) At any
time prior to the Effective Time, either BNI or SFP, in its sole discretion,
may notify the other party (the "Alternative Merger Notice") that it has
determined to restructure the transaction in the manner contemplated by this
Section 1.8. Upon delivery of the Alternative Merger Notice in the manner set
forth in Section 11.1 hereof (the "Alternative Election"), the Merger
contemplated by Section 1.1 of this Agreement shall be restructured in the
manner set forth in this Section 1.8. In such event, all references to the
term "Merger" in this Agreement shall be deemed references to the transactions
contemplated by this Section 1.8, all references to the term "Surviving
Corporation" shall be deemed references to BNSF Corporation, a Delaware
corporation ("BNSF"), all references to the term "Effective Time" in this
Agreement shall be deemed references to the time at which the certificates of
<PAGE>
merger are duly filed with the Secretary of State of the State of Delaware (or
at such later time as is specified in the certificate of merger) with respect
to the Merger as restructured in the manner contemplated by this Section 1.8
and Sections 1.2(a), 1.2(b), 1.4 and 1.7 shall no longer be of any force or
effect and the provisions of this Section 1.8 shall govern the terms of the
Merger. Prior to the Effective Time, BNSF will be controlled equally by BNI
and SFP. The Merger, restructured as contemplated by this Section 1.8, is
sometimes referred to as the "Alternative Merger".
(b) Prior to the Effective Time, BNSF will be controlled
equally by BNI and SFP. Prior to the Effective Time of the Alternative
Merger, BNI and SFP will cause BNSF to incorporate two wholly owned
subsidiaries as Delaware corporations ("BNI Merger Sub" and "SFP Merger Sub").
At the Effective Time of the Alternative Merger, (i) BNI Merger Sub will be
merged with and into BNI in accordance with Delaware Law, whereupon the
separate existence of BNI Merger Sub shall cease, and BNI shall be the
surviving corporation, and (ii) SFP Merger Sub will be merged with and into
SFP in accordance with Delaware Law, whereupon the separate existence of SFP
Merger Sub shall cease, and SFP shall be the surviving corporation.
(c) At the Effective Time of the Alternative Merger, (i) each
share of SFP Common Stock outstanding immediately prior to such Effective Time
shall, except as otherwise provided in Section 1.8(d) below, be converted into
0.40 shares of the common stock of BNSF, no par value (the "BNSF Common
Stock"), and (ii) each share of BNI Common Stock outstanding immediately prior
to such Effective Time shall, except as otherwise provided in Section 1.8(d)
below, be converted into 1.0 share of BNSF Common Stock.
(d) Each share of BNI Common Stock or SFP Common Stock (other
than the SFP Common Stock owned by BNI, which shall remain outstanding) held
by either of BNI or SFP as treasury stock or owned by BNI, SFP or any
Subsidiary of either of them immediately prior to the Effective Time of the
Alternative Merger shall be cancelled and no payments shall be made with
respect thereto.
(e) The BNSF Common Stock to be received as consideration in
the Alternative Merger by holders of BNI Common Stock or SFP Common Stock is
referred to herein as the "Merger Consideration".
(f) (i) At the Effective Time of the Alternative Merger,
each outstanding option to purchase shares of SFP Common Stock (a "SFP Stock
Option") or BNI Common Stock (or "BNI Stock Option") granted under any
employee stock option or compensation plan or arrangement of SFP or BNI, as the
case may be, shall be cancelled and substituted with an option (a "BNSF
Option") to acquire BNSF Common Stock. Such cancellation and substitution
shall comply in all respects with, and shall be performed in accordance with,
the methodology prescribed by the provisions of Section 424(a) of the Code and
the regulations thereunder, and each BNSF Option shall provide the option
holder with rights and benefits that are no less favorable to him than were
provided under the SFP Stock Option or BNI Stock Option for which it was
substituted.
(ii) At or as soon as possible after the Effective Time of the
Alternative Merger, BNSF shall issue to each holder of an SFP Stock Option or
BNI Stock Option which is cancelled pursuant to Section 1.8(f)(i) an agreement
that accurately reflects the terms of the BNSF Option substituted therefor as
contemplated by Section 1.8(f)(i).
(iii) BNSF shall take all corporate actions necessary to
reserve such number of shares of BNSF Common Stock as will be necessary to
<PAGE>
satisfy exercises in full of all BNSF Options after the Effective Time. With
respect to such BNSF Common Stock, BNSF shall (i) as soon as practicable after
the Effective Time of the Alternative Merger file with the SEC a Registration
Statement on Form S-8 and use its reasonable best efforts to have such
registration statement become and remain continuously effective under the 1933
Act and (ii) file with the NYSE a listing application and use its reasonable
best efforts to have such shares admitted to trading thereon upon exercises
of BNSF Options. BNSF shall also use its reasonable best efforts to ensure
that all incentive stock options within the meaning of the Code continue to
qualify as such at all times after such Effective Time.
(g) No certificates or scrip representing fractional shares
of BNSF Common Stock will be issued in the Alternative Merger, but in lieu
thereof each holder of SFP Common Stock otherwise entitled to a fractional
share of BNSF Common Stock will be entitled to receive, from the Exchange
Agent in accordance with the provisions of this Section 1.8_, a cash payment
in lieu of such fractional shares of BNSF Common Stock which would otherwise
have been issued (the "Excess Shares"). The sale of the Excess Shares by the
Exchange Agent shall be executed on the NYSE through one or more member firms
of the NYSE and shall be executed in round lots to the extent practicable.
Until the net proceeds of such sale or sales have been distributed to the
holders of SFP Common Stock, the Exchange Agent will hold such proceeds in
trust (the "Common Shares Trust") for the holders of the SFP Common Stock.
BNSF shall pay all commissions, transfer taxes and other out-of-pocket
transaction costs, including the expenses and compensation of the Exchange
Agent, incurred in connection with this sale of the Excess Shares. The
Exchange Agent shall determine the portion of the Common Shares Trust to which
each holder of SFP Common Stock shall be entitled, if any, by multiplying the
amount of the aggregate net proceeds comprising the Common Shares Trust by a
fraction the numerator of which is the amount of the fractional BNSF Common
Stock interest to which such holder of SFP Common Stock is entitled and the
denominator of which is the aggregate amount of fractional share interests to
which such holder of SFP Common Stock is entitled. As soon as practicable
after the determination of the amount of cash, if any, to be paid to holders
of SFP Common Stock in lieu of any fractional shares of BNSF Common Stock, the
Exchange Agent shall make available such amounts to such holders of SFP Common
Stock without interest.
(h) Immediately prior to the Effective Time of the
Alternative Merger, BNSF will become a party to this Agreement, assume all
obligations of BNI hereunder in its capacity as the Surviving Corporation and
make the following representations and warranties to each of BNI and SFP:
(i) Corporate Existence and Power. At the Effective Time,
BNSF will be a corporation duly incorporated, validly existing and in
good standing under the laws of its jurisdiction of incorporation and
will have all corporate powers and all material governmental licenses,
authorizations, consents and approvals required to carry on the
businesses of BNI and SFP as such business are now conducted. At the
Effective Time, BNSF will be duly qualified to do business as a
foreign corporation and will be in good standing in each jurisdiction
where the character of the property owned or leased by it or the
nature of its activities makes such qualification necessary, except
for those jurisdictions where the failure to be so qualified would
not, individually or in the aggregate, have a Material Adverse Effect
on BNSF.
(ii) Corporate Authorization. At the Effective Time, the
execution, delivery and performance by BNSF of this Agreement and the
consummation by BNSF of the transactions contemplated hereby will be
<PAGE>
within the corporate powers of BNSF and will have duly authorized by
all necessary corporate action on the part of BNSF. At the Effective
Time, this Agreement will constitute a valid and binding agreement of
BNSF.
(iii) Governmental Authorization. At the Effective Time, the
execution, delivery and performance by BNSF of this Agreement and the
consummation of the Merger by BNSF will require no action by or in
respect of, or filing with, any governmental body, agency, official
or authority other than (i) the filing of a certificate of merger in
accordance with Delaware Law; (ii) compliance with any applicable
requirements of the Exchange Act; (iii) compliance with the applicable
requirements of the 1933 Act; (iv) compliance with any applicable
foreign or state securities or Blue Sky laws; (v) immaterial actions
or filings relating to ordinary operational matters; and (vi) actions
that have theretofore been taken or filings that have theretofore
been made.
(iv) Non-Contravention. At the Effective Time, the execution,
delivery and performance by BNSF of this Agreement and the
consummation by BNSF of the transactions contemplated hereby will not
(except, in the case of clauses (B), (C) and (D) of this Section
1.8(h)(iv), for any such matters that singly or in the aggregate have
not had, and would not reasonably by expected to have, a Material
Adverse Effect on BNSF (A) contravene or conflict with the
certificate of incorporation or bylaws of BNSF, (B) assuming
compliance with the matters referred to in Section 1.8(h)(iii),
contravene or conflict with or constitute a violation of any
provision of any law, regulation, judgment, injunction, order or
decree binding upon or applicable to BNSF or any Subsidiary of BNSF,
(C) constitute a default under or give rise to any right of
termination, cancellation or acceleration of any right or obligation
of BNSF or any of its Subsidiaries or to a loss of any benefit to
which BNSF or any of its Subsidiaries is entitled under any
agreement, contract or other instrument binding upon BNSF or any of
its Subsidiaries or any license, franchise, permit or other similar
authorization held by BNSF or any of its Subsidiaries or (D) result
in the creation or imposition of any Lien on any asset of BNSF or any
Subsidiary of BNSF.
(i) Prior to the Effective Time of the Alternative Merger, BNI
and SFP shall ensure that BNSF, BNI Merger Sub and SFP Merger Sub take no
actions and undertake no operations except as may be necessary in connection
with the consummation of the Merger and the transactions contemplated hereby.
(j) At the time of the Alternative Election, and without any
further action on the part of either SFP or BNI, this Agreement shall be
deemed to have been amended as follows:
(i) The phrase "BNSF," will be added (x) between the phrase
"operation of the business of" and the phrase "BNI, SFP and their" in
Section 9.1(iii) and (y) between the phrase "impose on" and "BNI, SFP
or any" in clause (3) of Section 9.1(v).
(ii) A new Section 9.2(iii) and 9.3(v) will be added as
follows:
BNSF shall have performed in all material respects all of its
obligations hereunder required to be performed by it at or prior to
the Effective Time, and the representations and warranties of BNSF
<PAGE>
shall have been accurate in all material respects at and as of the
Effective Time.
(iii) Section 9.3(ii) shall be amended to read in its entirety
as follows:
(ii) the BNSF Common Stock required to be issued hereunder
shall have been approved for listing on the NYSE, subject to official
notice of issuance.
(k) BNI and SFP agree that in the event of the Alternative
Election, any other appropriate adjustments shall be made to the other terms
and conditions of this Agreement to reflect the transactions contemplated by
this Section 1.8 with a view to ensuring that the parties hereto and their
stockholders are placed in a position that is as close as possible to the
position they would have been in but for such restructuring.
27. This Amendment shall be construed in accordance with and
governed by the law of the State of Delaware (without regard to
principles of conflict of laws).
28. This Amendment may be signed in any number of
counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same
instrument. This Amendment shall become effective when each party
hereto shall have received counterparts hereof signed by all of the
other parties hereto.
29. Except as expressly amended hereby, the Merger Agreement
shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed by their respective authorized officers as of the day and
year first above written.
Burlington Northern Inc.
By: /s/ Gerald Grinstein
Title: Chairman, President &
Chief Executive Officer
Santa Fe Pacific Corporation
By: /s/ Robert D. Krebs
Title: Chairman and Chief
Executive Officer
EXHIBIT 99.1
PRESS RELEASE DECEMBER 17, 1994
Contacts: For Burlington Northern Inc. For Santa Fe Pacific
Corporation
Richard Russack Catherine Westphal
(817) 333-6116 (708) 995-6273
BURLINGTON NORTHERN AND SANTA FE PACIFIC AMEND THEIR
MERGER AGREEMENT TO FACILITATE SUCCESSFUL COMPLETION
OF THEIR STRATEGIC BUSINESS COMBINATION
-- Santa Fe to Conduct Self-Tender Offer to Purchase 38 Million
of its Shares for $20 Per Share, Burlington Northern
to Tender for Another 25 Million Santa Fe Shares at Same Price --
-- Exchange Ratio Increased to .40 Burlington Northern Shares
in Proposed Second-Step, Tax-Free Stock-for-Stock Exchange --
-- Grinstein and Krebs Say Revision "Reflects Companies'
Determination to Complete their Pro-Competitive, ICC-Approvable,
Financially Sound Merger" --
FORT WORTH, TEXAS and SCHAUMBURG, ILLINOIS, December 18, 1994 -- "Reflecting
the determination of Burlington Northern Inc. and Santa Fe Pacific Corporation
to build the value of our two companies for our respective shareholders by
facilitating the successful completion of our pro-competitive, ICC-approvable
and financially sound strategic business combination, BN and Santa Fe will
shortly commence a joint tender offer to acquire a total of 63 million Santa
Fe shares, or approximately 33 percent of all such shares outstanding, at $20
per share in a recapitalization and merger transaction," Gerald Grinstein,
Chairman and Chief Executive Officer of Burlington Northern Inc., and Robert D.
Krebs, Chairman, President and Chief Executive Officer of Santa Fe Pacific
Corporation, announced today.
Under the terms of their amended merger agreement, Santa Fe will conduct a
cash tender offer at $20 per share to acquire 38 million of its shares
outstanding, representing approximately 20 percent of such shares, for a total
of $760 million. At the same time, BN will launch a cash tender offer, also
at a price of $20 per share, to acquire 25 million shares of Santa Fe,
representing approximately 13 percent of such Santa Fe shares currently
outstanding, for $500 million. The tender offers will be made on a combined
basis and are expected to commence on or before Friday, December 23, 1994.
Following ICC approval, which the companies expect to receive in mid-1996, BN
and Santa Fe will complete their merger through a tax-free exchange of stock
at the increased exchange ratio of .40 of a BN share for each remaining share
of Santa Fe. This two-step transaction will have substantially the same
financial effect as an acquisition of Santa Fe by BN for 33 percent in cash
and 67 percent in BN stock. Based on Friday's closing price of BN common
stock, the two-step transaction will have a blended value of $20.40 per Santa
Fe share, or $3.8 billion in aggregate.
Mr. Grinstein said: "The boards of directors of BN and Santa Fe have
unanimously reaffirmed their commitment to bring together our two great
railroads in a win-win transaction for everyone concerned. This
pro-competitive, end-to-end merger of our two systems will benefit shippers
<PAGE>
and the general public by providing expanded single-line rail services, while
enhancing our nation's ability to compete in world markets by making efficient
use of our existing transportation infrastructure. It will create a rail
network in the western United States with far broader geographic coverage than
either of the carriers' existing systems, enhancing the ability of U.S.
shippers to get their products to market on a timely, cost-effective and
competitive basis. The combined company will also be a financially strong
rail carrier with a diversified traffic base and excellent financial prospects
that will effectively compete with the dominant railroad in the West, Union
Pacific."
The transaction structure announced today is a refinement of the one
originally contemplated when the proposed merger of the two companies was
announced on June 30. That transaction called for BN to acquire Santa Fe in a
stock swap valued at $2.7 billion on June 30 with an exchange ratio of .27,
increased on October 26 to .34 for a transaction valued at $3.2 billion on
that date. The modification of the exchange ratio followed the hostile
takeover bid announced by Union Pacific Corporation (UP) in early October.
On November 8, in an attempt to gain the support of Santa Fe shareholders for
the UP merger proposal despite widespread doubts that a UP/Santa Fe merger
would win ICC approval, UP said it would place Santa Fe's rail operations in a
voting trust pending receipt of such approval. BN has challenged the legality
of UP's use of a voting trust in the Third Circuit Court in Philadelphia. The
Court is expected to make its decision on this issue this week.
Mr. Krebs of Santa Fe said: "A business combination of Santa Fe and BN is in
the best long-term interests of both companies, their respective shareholders,
and our nation. While preserving the values of the original structure for BN
shareholders, the new structure allows Santa Fe shareholders who wish to
receive a substantial portion of the consideration in cash up front to do so
without waiting for ICC approval. At the same time, it allows Santa Fe
shareholders to participate in the substantial upside potential of the
combined company. This approach is the right approach for both companies.
Jerry Grinstein and I and our respective boards of directors are pleased that
we have found an alternative way to get the job done."
Completion of the Santa Fe self-tender offer and the BN tender offer, both of
which will be financed by bank debt and available cash, is anticipated in late
January 1995. The Santa Fe and BN offers are subject to each company
obtaining bank financing, commitments for which are expected shortly. Under
the terms of the amended merger agreement, BN will also receive a break-up fee
of $50 million and expense reimbursement not to exceed $10 million in the
event that the BN/Santa Fe merger is not completed because of a new competing
offer.
As previously announced, BN and Santa Fe have rescheduled their respective
special shareholders' meetings to vote on the BN/Santa Fe merger for Friday,
January 27, 1995, with a new record date of December 27, 1994. Consummation
of the tender offer is contingent, among other things, on a vote by the
holders of a majority of the shares of both companies in favor of the merger.
In addition, shortly after completion of the tender offer, Santa Fe intends to
offer to repurchase certain existing debt obligations totalling approximately
$400 million, including (1) the $100 million 8 3/8% notes due November 1, 2001
and (2) the $100 million 8 3/8% notes due November 1, 2004. Proceeds for
these repurchases will also be funded from the bank financing.
Burlington Northern Inc. (NYSE: BNI) is the parent company of Burlington
Northern Railroad, the largest transporter of grain and coal in America. It
also serves customers in a variety of consumer, automotive and forest products
<PAGE>
and manufacturing industries.
Santa Fe Pacific Corporation (NYSE: SFX) is the parent company of Atchison,
Topeka and Santa Fe Railway and Santa Fe Pacific Pipeline Partners, L.P.
Santa Fe Railway holds the record for hauling intermodal shipments, more than
1.22 million units annually, and currently serves 12 western, midwestern and
southwestern states between Chicago, the West Coast, and the Gulf of Mexico.
