SCHEDULE 14A
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF
THE SECURITIES EXCHANGE ACT OF 1934
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Filed by the Registrant [x]
Filed by a Party other than the Registrant [x]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[X ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
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BURLINGTON NORTHERN INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
BURLINGTON NORTHERN INC.
(NAME OF PERSON(S) FILING PROXY STATEMENT)
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Payment of Filing Fee (Check the appropriate box): (/1/)
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-
6(i)(3).
[x] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
Santa Fe Pacific Corporation common stock, par value $1.00 per
share.
(2) Aggregate number of securities to which transactions applies:
187,049,738 shares of Santa Fe Pacific Corporation common stock.
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11: $49 1/2 (/2/)
(4) Proposed maximum aggregate value of transaction: $3,148,047,091
(/2/)
(/1/) The filing fee previously was paid with the initial filing of the
preliminary proxy materials on August 8, 1994 and with the filing
of two Registration Statements on Form S-4 on October 12, 1994
(Reg. No. 33-56007) and October 27, 1994 (Reg. No. 33-56183),
respectively.
(/2/) For purposes of calculating the filing fee only. Upon consummation
of the Merger, each outstanding share of Santa Fe Pacific
Corporation common stock, par value $1.00 per share, will be
converted into the right to receive 0.34 shares of Burlington
Northern Inc. common stock, no par value. The proposed maximum
aggregate value of the transaction described in the preliminary
proxy materials is $3,148,047,091 (calculated based on the number
of shares of Santa Fe Pacific Corporation common stock
outstanding as of October 19, 1994, the average of the high and
low reported prices of Burlington Northern Inc. common stock on
October 21, 1994 and the exchange ratio of 0.34). The filing fee
is one-fiftieth of that amount.
[x] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:...................$1,145,590
(2) Form, Schedule or Registration
Statement No.:............................Preliminary Proxy
Statement
Registration Statement
on Form S-4
(Reg. No. 33-56007)
Registration Statement
on Form S-4, as amended
(Reg. No. 33-56183)
(3) Filing Party: ...................Burlington Northern
Inc./Santa Fe
Pacific Corporation
(4) Date filed: ...................August 8, 1994
...................October 12, 1994
...................October 27,1994
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.
