<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [_]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[_]Preliminary Proxy Statement [_]Confidential,for Use of the
[_]Definitive Proxy Statement Commission Only (as permitted
[X]Definitive Additional Materials by Rule 14a-6(e)(2))
[_]Soliciting Material Pursuant to Section 240.14a-11 or Section 240.14a-12
ITT CORPORATION
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
HILTON HOTELS CORPORATION
HLT CORPORATION
(NAME OF PERSON(S) FILING PROXY STATEMENT)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
----------------------------------------------------------------------
(5) Total fee paid:
----------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] 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:
----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
----------------------------------------------------------------------
(3) Filing Party:
----------------------------------------------------------------------
(4) Date Filed:
----------------------------------------------------------------------
<PAGE>
[HILTON HOTELS CORPORATION LOGO]
November 3, 1997
Dear ITT Shareholder:
We are pleased to announce that today we significantly improved the terms of
our offer to acquire ITT Corporation.
EFFECTIVE IMMEDIATELY WE HAVE RAISED THE PRICE OF OUR CASH TENDER OFFER TO
$80 PER SHARE AND SIMULTANEOUSLY INCREASED THE NUMBER OF SHARES WE ARE
OFFERING TO PURCHASE TO 65 MILLION -- REPRESENTING 55% OF ITT'S CURRENT
OUTSTANDING COMMON STOCK. Each share of the remaining 45% of ITT's outstanding
stock will then be converted into two shares of Hilton Common Stock and two
Contingent Value Preferred Shares in the proposed second-step merger. This
package is designed to ensure that you receive at least $80 in value per ITT
share converted in the second-step merger within one year.
By voting your WHITE proxy, you will elect a new Board of Directors
committed to creating the world's largest and strongest lodging and gaming
company for the benefit of ITT's and Hilton's shareholders, customers and
employees.
YOU NOW HAVE A REAL CHOICE -- VOTE FOR
A REAL DEAL THAT PROVIDES REAL VALUE!
VOTE TODAY TO REPLACE RAND ARASKOG AND HIS BOARD BY SIGNING, DATING AND
MAILING YOUR WHITE PROXY!
WE CONTINUE TO BELIEVE THAT A HILTON-ITT COMBINATION PROVIDES SUPERIOR SHORT
TERM AND LONG TERM VALUE FOR ALL SHAREHOLDERS OF ITT CORPORATION. IN OUR VIEW,
HILTON'S REVISED OFFER IS CLEARLY SUPERIOR TO THE STARWOOD-ITT PROPOSAL, WHOSE
NOMINAL VALUE HINGES ON QUESTIONABLE TAX BREAKS AND OVERSTATED SYNERGY
BENEFITS.
We believe ITT shareholders want and have the right to demand from a new
Board of Directors the best real offer for the future of their investment --
one that provides:
. GREATER CERTAINTY AND REAL LONG TERM VALUE WITH PROTECTION FROM DOWNSIDE
RISK IN A ROLLER COASTER STOCK MARKET.
<PAGE>
. A prompt completion date WITHOUT SIGNIFICANT REGULATORY DELAY.
. THREE TIMES THE CASH UP FRONT -- payable to all shareholders in an $80 per
share cash tender offer that is expected to close within 10 days after a
new Board of Directors is elected.
. Common Stock in a company with a strong management team that has A PROVEN
SUCCESSFUL TRACK RECORD in both the lodging and gaming industries.
. Real cost savings and synergies CONSERVATIVELY ESTIMATED TO BE WORTH $115
MILLION ANNUALLY, with upside potential from an experienced management
team. This same team successfully exceeded projections for cost savings
and synergies in integrating the Bally and Hilton gaming operations in
less than a year.
. A once in a lifetime opportunity to assemble in a single transaction
gaming properties that are UNIQUELY SITUATED IN BOTH ATLANTIC CITY AND LAS
VEGAS -- far and away the nation's two largest and most vibrant gaming
markets.
. A Hilton Board and management dedicated to building shareholder value --
whose management compensation is linked to Hilton's stock performance --
AND WHO SHARE A COMMITMENT TO THE FUTURE THROUGH THEIR INVESTMENT IN 28%
OF HILTON'S OUTSTANDING SHARES.
. Upside potential and downside protection in the form of Contingent Value
Preferred Shares and a sound stock valuation based on real earnings, solid
cash flow and excellent growth prospects -- COMPARED TO STARWOOD'S THINLY
TRADED, HIGHLY VOLATILE STOCK WITH RISKS OF MARKET DECLINE AND NO DOWNSIDE
PROTECTION.
. A SOUND TRANSACTION STRUCTURE, UNLIKE STARWOOD'S QUESTIONABLE TAX
AVOIDANCE STRUCTURE WHICH IS BOTH OVERSTATED IN VALUE AND LIKELY TO COME
UNDER INTENSE SCRUTINY FROM THE IRS AND CONGRESS.
DON'T GET BURNED BY STARWOOD'S HIGHLY SPECULATIVE OFFER.
VOTE YOUR WHITE PROXY TODAY!
The Hilton offer is superior -- we offer more cash for more of your shares
and we provide substantial upside potential and downside protection. The
Contingent Value Preferred Shares that you will receive are designed to ensure
at least $80 in value within one year for each share of ITT stock you exchange
in the Hilton merger.
WE BELIEVE WE OFFER THE BEST MANAGEMENT TEAM IN THE GAMING AND LODGING
BUSINESSES. WE OFFER THE REAL ABILITY TO DELIVER SIGNIFICANT COST SAVINGS AND
SYNERGIES THAT WILL ENHANCE THE VALUE OF YOUR INVESTMENT IN A POWERFUL GROWTH
COMPANY.
<PAGE>
Remember -- upon the election of Hilton's nominees, under the revised terms
of Hilton's proposal, you will benefit from:
. Hilton's tender offer of $80 in cash for 55% of ITT's outstanding shares
(scheduled to close within ten days after the Hilton nominees are
elected).
. A second step merger giving you two shares of Hilton common stock for each
share of ITT common stock (scheduled to close within 90 days after the
Hilton nominees are elected).
. Contingent Value Preferred Shares that will pay you up to $24 per ITT
share exchanged if the trading value of the two shares of Hilton common
stock you receive for each ITT share in the merger does not reach at least
$80 within one year after the merger. We plan to list this additional
freely tradeable security on a national securities exchange.
If you elect our nominees at the November 12, 1997 Annual Meeting, the new
board will remove the incumbent board's poison pill impediment and take all
other necessary steps to accept and consummate Hilton's revised offer, subject
to its fiduciary duty to accept any superior offer that may be made after the
election. The tender offer is anticipated to close within 10 days thereafter.
The second-step merger will be scheduled to close within 90 days of the
election.
DON'T FORGET THE FOLLOWING FACTS!
The fact is that Rand Araskog and his board were nearly able to hide behind
the poison pill when they tried to cram down their inferior "comprehensive
plan" on shareholders. That plan was enjoined by the Nevada federal court,
which found that the ITT board's primary purpose in adopting the
"comprehensive plan" was to entrench itself in office.
The fact is that now, unless Rand Araskog and his fellow incumbent directors
are replaced, they will continue to use their poison pill as a roadblock to
prevent shareholders from choosing the superior benefits provided by Hilton's
acquisition offer.
DON'T LET ITT FOOL YOU:
Do you really believe Starwood will obtain the numerous regulatory approvals
and licenses necessary to close their transaction before the second quarter of
1998? Do you really believe the Starwood deal will happen if you reelect Rand
Araskog and his board, or will it be dropped -- just like the "comprehensive
plan" and the announced "deals" for the Desert Inn, Planet Hollywood and
others?
<PAGE>
DON'T GAMBLE WITH THE VALUE OF YOUR INVESTMENT!
REJECT ITT'S ATTEMPT TO DENY YOU THE RIGHT TO CHOOSE HILTON'S SUPERIOR
ACQUISITION OFFER. VOTE YOUR WHITE PROXY TO ELECT NOMINEES COMMITTED TO
BRINGING YOU THE BENEFITS OF A HILTON-ITT MERGER.
We urge you to act promptly. The Annual Meeting is scheduled for next
Wednesday, November 12, at 11:30 A.M.
REMEMBER -- Tuesday the 11th of November is a U.S. post office holiday with
no regularly scheduled mail deliveries. IF YOU WANT TO BE SURE YOUR PROXY IS
RECEIVED IN TIME ACT TODAY BY EXPRESS MAIL, FEDEX, OR UPS NEXT DAY MAIL.
You won the right to vote for the Hilton nominees and therefore also won the
right to choose between the value driven Hilton-ITT combination or the
speculative Starwood proposal. DO NOT MISS THIS RARE OPPORTUNITY TO TAKE
MATTERS OF SUCH IMPORTANCE INTO YOUR OWN HANDS.
Now, after six months of delay, the opportunity to vote for the Hilton
nominees is finally here. Don't waste your vote.
PLEASE SIGN, DATE AND MAIL YOUR WHITE PROXY TODAY!
DO NOT SIGN OR RETURN ANY BLUE ITT PROXY CARDS.
DO NOT DELAY -- TIME IS SHORT!
If you have any questions or need assistance to be sure your vote is
received in time please call MacKenzie Partners at (800) 322-2885 Toll-Free or
at (212) 929-5500 collect.
We appreciate your support and careful consideration of all the information
you have received over the past nine months.
Sincerely,
/s/ Stephen F. Bollenbach
Stephen F. Bollenbach
President and Chief Executive
Officer
<PAGE>
SECOND
SUPPLEMENT
TO
PROXY STATEMENT
OF
[HILTON HOTELS CORPORATION LOGO]
HOTELS CORPORATION
AND
HLT CORPORATION
----------------
1997 ANNUAL MEETING OF STOCKHOLDERS
OF
ITT CORPORATION
TO BE HELD
WEDNESDAY, NOVEMBER 12, 1997
- --------------------------------------------------------------------------------
HILTON HOTELS CORPORATION AND HLT CORPORATION BELIEVE THAT
HILTON'S $80 OFFER AND THE PROPOSED HILTON MERGER ARE IN THE BEST
INTERESTS OF ITT'S STOCKHOLDERS AND URGE YOU TO VOTE FOR THE
HILTON NOMINEES AND THE OTHER PROPOSALS DESCRIBED BELOW.
WE URGE YOU TO ACT PROMPTLY. THE ANNUAL MEETING IS SCHEDULED FOR
NEXT WEDNESDAY, NOVEMBER 12, AT 11:30 A.M. REMEMBER -- TUESDAY,
NOVEMBER 11, IS A U.S. POST OFFICE HOLIDAY WITH NO REGULARLY
SCHEDULED MAIL DELIVERIES. IF YOU WANT TO BE SURE YOUR PROXY IS
RECEIVED IN TIME, ACT TODAY BY EXPRESS MAIL, FEDEX, OR UPS NEXT
DAY MAIL.
PLEASE SIGN, DATE AND RETURN THE ENCLOSED WHITE PROXY CARD
- --------------------------------------------------------------------------------
This Supplement (the "Second Supplement") is being furnished to stockholders
of ITT Corporation (the "Company") by Hilton Hotels Corporation, a Delaware
corporation ("Hilton"), and HLT Corporation, a Delaware corporation and wholly
owned subsidiary of Hilton ("HLT"), in connection with the solicitation of
proxies from the Company's stockholders to be used at the 1997 Annual Meeting
of Stockholders of the Company, including any adjournments or postponements
thereof and any special meeting called in lieu thereof (the "Annual Meeting"),
to take the following actions: (i) to elect 11 persons nominated by Hilton and
HLT (the "Hilton Nominees") to the Board of Directors of the Company (the
"Board"), who will take all actions as may be necessary to facilitate the
Offer (as defined below) and the Proposed Hilton Merger (as defined below),
subject to their fiduciary duty to accept any superior offer for the Company
that may be made after their election; (ii) to approve a non-binding
stockholder resolution urging the Board to arrange for the sale of the Company
to Hilton, HLT or any bidder offering a higher price for the Company (the
"Sale Resolution"); and (iii) to approve a stockholder resolution to repeal
each and every provision of the Amended and Restated By-laws of the Company
(the "Bylaws") adopted on or after July 23, 1996 and prior to the adoption of
such resolution (the "Bylaws Resolution," and together with the Sale
Resolution, the "Proposals"). According to the Company, the Annual Meeting is
scheduled to take place on November 12, 1997, and the Record Date for
determining stockholders entitled to notice of and to vote at the Annual
Meeting has been fixed as the close of business on October 1, 1997.
This Second Supplement and the enclosed WHITE proxy card are first being
furnished to the Company's stockholders on or about November 3, 1997. This
Second Supplement supplements and amends the original
<PAGE>
Proxy Statement dated March 21, 1997 (the "Proxy Statement") and the
Supplement to the Proxy Statement dated October 6, 1997 (the "First
Supplement") with information and a summary of developments since the First
Supplement was mailed to the Company's stockholders on October 6, 1997, and
should be read in conjunction with the Proxy Statement and First Supplement.
Unless defined in this Second Supplement, capitalized terms used in this
Second Supplement shall have their respective meanings as set forth in the
Proxy Statement and First Supplement.
THE AMENDED OFFER AND THE PROPOSED STARWOOD TRANSACTION
On October 19, 1997, the Board approved a merger agreement (the "Starwood
Merger Agreement") with Starwood Lodging Corporation and Starwood Lodging
Trust ("Starwood"), under which Starwood would acquire the Company in exchange
for $15 in cash and between 1.094 and 1.258 paired shares of Starwood for each
Share. The Board approved the Starwood Merger Agreement without ever having
talked to Hilton, despite repeated requests by Hilton to meet to discuss
Hilton's proposal to acquire the Company. In Hilton's view, the proposed
acquisition of the Company by Starwood involves numerous risks. These include
risks as to the inherent value of Starwood and the volatility of the Starwood
paired shares, risks as to the level of purported tax benefits afforded by the
Starwood paired share structure and the possibility that any tax benefits will
be rescinded by the Internal Revenue Service or Congress, risks as to the
timing of the closing of the proposed Starwood acquisition and whether the
acquisition will in fact be completed, risks of failure to successfully
integrate the massive amount of assets proposed to be acquired by Starwood
(including the proposed Westin Hotels & Resorts and ITT acquisitions), risks
associated with the lack of operating history and management experience of
Starwood management, risks as to the future of the Company's gaming and other
operations, and risks associated with Starwood's inability to maintain its
growth strategy over an asset base several times the size of its current asset
base. For these reasons, Hilton believes that the actual value of the proposed
Starwood acquisition to the Company's shareholders is far less than the
nominal value placed on the transaction by Starwood and the incumbent Board.
The average closing price per Share for the week prior to the announcement of
Hilton's amended $80 offer was only $73.29.
On November 3, 1997, Hilton amended its proposal to acquire the Company.
Pursuant to this amended proposal, Hilton is offering $80 per Share in cash
for 65,000,000 Shares, constituting about 55% of the outstanding Shares. This
offer is made net to the seller in cash, without interest thereon, upon the
terms and subject to the conditions set forth in the Offer to Purchase and in
the related letter of transmittal (the "Letter of Transmittal") (which, as
amended from time to time, together constitute the "Offer"), and, unless and
until validly redeemed by the Board, includes the Series A Participating
Cumulative Preferred Stock Purchase Rights (the "Rights") associated with the
Shares and issued pursuant to the Rights Agreement, dated as of November 1,
1995, between the Company and The Bank of New York, as Rights Agent (as
previously amended, the "Rights Agreement"). The purpose of the Offer is for
Hilton to acquire control of, and ultimately the entire equity interest in,
the Company. The Offer is currently scheduled to expire at 12:00 Midnight, New
York City time, on Monday, November 17, 1997, unless extended (as such date
may be extended, the "Expiration Date").
Under the terms of Hilton's amended proposal, following consummation of the
Offer, the Company would complete a second-step merger with Hilton or HLT or
another subsidiary of Hilton (the "Proposed Hilton Merger"), in which each
remaining Share (other than Shares held in the treasury of the Company or
owned by Hilton, HLT or any direct or indirect wholly owned subsidiary of
Hilton) would be converted into two shares of Hilton Common Stock. In
addition, with each share of Hilton Common Stock issued in the Proposed Hilton
Merger, shareholders of the Company would receive one share of Contingent
Value Preferred Stock (the "CVP Shares"). The CVP Shares would provide that,
if the stock price of the Hilton Common Stock does not reach $40 per share
within one year following the date when the Proposed Hilton Merger shall
become effective (the "Effective Time"), the holder will receive an additional
payment for each CVP Share, in cash or additional shares of Hilton Common
Stock, equal to the difference between $40 and the per share price of the
Hilton Common Stock one year following the Effective Time, up to a maximum of
$12. Of course, if the Hilton Common Stock is already trading at or above $40
per share at the Effective Time, no CVP Shares will be issued in the Proposed
Hilton Merger.
2
<PAGE>
Thus, under Hilton's proposal, shareholders of the Company will receive $80
per Share in cash for 65,000,000 Shares, and will exchange their remaining
Shares for an interest in the combined company that is certain to be worth $80
for each Share within one year (so long as the price of one share of Hilton
Common Stock remains above $28). Hilton believes that its amended proposal
offers a clearly superior deal for the Company's shareholders, offering
greater value, more speed, more certainty, and less risk than the proposed
Starwood transaction.
REGULATORY AND LITIGATION DEVELOPMENTS
Nevada Gaming Regulation. The Chairman of the Nevada Board has stated that
the Nevada Board will hold a special meeting on November 13, 1997 to consider
the application of Hilton and HLT to acquire control of the Company. Hilton
has requested that the Nevada Commission schedule a special meeting on
November 13 or 14, 1997 to consider the application of Hilton and HLT to
acquire control of the Company.
New Jersey Gaming Regulation. At a hearing on October 22, 1997, the New
Jersey Casino Control Commission (the "CCC") unanimously qualified three of
the Hilton Nominees, Messrs. Aronoff, Kingsley, and Brunet, to serve as
members of the Board in the event they are elected at the Annual Meeting. In
addition, at that hearing, the Chairman of the CCC stated that action would be
taken with respect to qualification (either on a plenary or temporary basis)
of the other eight Hilton Nominees at the CCC's next hearing on November 5,
1997. At the October 22, 1997 hearing, the CCC also directed Hilton to file
for interim casino authorization immediately following completion of the
Offer.
FCC Regulation. On October 15, 1997, the FCC issued an order approving the
insubstantial transfer of control of the Company that would result upon the
election of the Hilton Nominees to the Board at the Company's 1997 Annual
Meeting.
Litigation. On August 25, 1997, Hilton and HLT filed a motion in the U.S.
District Court for the District of Nevada seeking (i) to preliminarily and
permanently enjoin the Company and its directors from proceeding with their
proposed plan to break the Company up by spinning off the Company's hotel and
gaming businesses and the Company's educational services business (the
"Comprehensive Plan"), (ii) declaratory relief that by adopting the
Comprehensive Plan, the Company's directors breached their fiduciary duties to
the Company and its stockholders, (iii) declaratory relief that the Company
may not implement its Comprehensive Plan without obtaining a stockholder vote,
and (iv) to require the Company to conduct its Annual Meeting no later than
November 14, 1997. On September 29, 1997, the Nevada Court found that the
Company's Comprehensive Plan "had as its primary purpose the entrenchment of
the current ITT board," and that the implementation of the Comprehensive Plan
was designed to "impermissibly impede the exercise of the shareholder
franchise." The Nevada Court enjoined the Company from implementing the
Comprehensive Plan, and further ordered that the Company hold its Annual
Meeting on or before November 14, 1997.
On November 3, 1997, Hilton and HLT filed a complaint in the Nevada Court
against the Company, Starwood and individual members of the Board. The
complaint alleges that the Company and its directors unlawfully excluded
Hilton from the process that led to the Company entering into the Starwood
Merger Agreement and that the Company and its directors wrongfully agreed to
pay Starwood a grossly excessive "break up" fee of up to $225 million and
expense reimbursement in excess of $25 million. The complaint alleges that the
"break up" fee and expense reimbursement provisions constitute a gross waste
of the Company's corporate assets and unlawfully interfere with the right of
the Company's stockholders to vote for the Hilton Nominees. The complaint
further alleges that the Company's directors have breached their fiduciary
duties to the Company's stockholders by engaging in corporate waste for the
primary purpose of entrenching and benefiting themselves and others in their
positions at the Company and that they have made materially misleading
disclosures with respect to the transaction contemplated by the Starwood
Merger Agreement. The complaint seeks, among other things, an order
invalidating the Starwood Merger Agreement, particularly the "break up" fee
and expense reimbursement provisions thereof, and seeks over $500 million in
damages from the individual directors.
3
<PAGE>
ITEM NO. 1 -- ELECTION OF DIRECTORS
At the Annual Meeting, 11 directors will be elected to the Board. The 11
Hilton Nominees will take prompt action to facilitate completion of the Hilton
Offer and the Proposed Hilton Merger (subject to their fiduciary duty to
accept any superior offer for the Company that may be made after their
election). To date, the incumbent Board has opposed the Hilton Offer and has
refused even to meet with Hilton. IN ORDER TO ACCEPT THE HILTON OFFER, HILTON
URGES YOU TO VOTE FOR THE HILTON NOMINEES.
Set forth below is a summary of the principal business affiliations and
other information with respect to the 11 Hilton Nominees who will be nominated
to replace the incumbent Board. In the event the Company increases the size of
the Company's Board of Directors or any of the nominees set forth below is
unable to serve, Hilton also intends to nominate one or more of the other
individuals listed in the Proxy Statement and First Supplement. For more
complete information, please see the Proxy Statement and First Supplement.
<TABLE>
<CAPTION>
NAME, AGE AND BUSINESS (OR PRINCIPAL OCCUPATION OR EMPLOYMENT
RESIDENCE) ADDRESS DURING THE LAST FIVE YEARS; CURRENT DIRECTORSHIPS
- -------------------------- -------------------------------------------------
<S> <C>
Daniel J. Altobello (56)......... Chairman, ONEX Food Services, Inc. (airline catering),
ONEX Food Services, Inc. since September 1995. Prior thereto, Chairman, Chief
550 Rock Spring Drive Executive Officer and President, Caterair International
Bethesda, Maryland 20817 Corporation (airline catering), from before 1992 until
September 1995. Mr. Altobello is also a director of
American Management Systems, Inc. and Blue Cross & Blue
Shield of Maryland, Inc., and a member of the Board of
Advisors to Thayer Capital Partners.
George N. Aronoff (64)........... Partner, Benesch, Friedlander, Coplan & Aronoff LLP
Benesch, Friedlander, Coplan & (law firm), since before 1992. Mr. Aronoff is also a
Aronoff LLP director of Specialty Chemical Resources, Inc.
2300 BP America Building
200 Public Square
Cleveland, Ohio 44114
Scott H. Bice (54)............... Dean of the University of Southern California Law
University of Southern California School, since before 1992. Mr. Bice is also a director
Law School of Jenny Craig, Inc.
University Park
Los Angeles, California 90089
Barrie K. Brunet (72)............ Retired since March 1990. Mr. Brunet is also a director
1510 Patrick Avenue of Reno Air, Inc.
Reno, Nevada 89509
James J. Florio (59)............. Partner, Florio & Perrucci, P.C. (law firm), since
Florio & Perrucci, P.C. 1995. Prior thereto, Partner, Mudge, Rose, Guthrie,
371 Hoes Lane Alexander & Ferdon (law firm), from January 1994 until
Piscataway, New Jersey 08854 October 1995; Governor of the State of New Jersey, from
January 1990 until January 1994.
Fred D. Gibson, Jr. (70)......... Chairman of American Pacific Corporation (specialty
American Pacific Corporation chemicals production), since before 1992. President and
3770 Howard Hughes Parkway Chief Executive Officer of American Pacific Corporation
Suite 300 from before 1992. Mr. Gibson is also a director of
Las Vegas, Nevada 89109 American Pacific Corporation
and Nevada Power Company.
</TABLE>
4
<PAGE>
<TABLE>
<S> <C>
Dianne Jett (47)................. Retired since August 1996. Prior thereto, President,
7833 Surfcrest Court Sprint-Central Telephone Company of Nevada
Las Vegas, Nevada 89128 (telecommunications), from March 1993 until August
1996; and General Regulatory Manager, Central Telephone
Company of Nevada (telecommunications), from before
1992 until March 1993.
Robert S. Kingsley (51).......... Private Investor. Prior thereto, President and Chief
397 Mine Brook Road Operating Officer, HFS Gaming Corp. (gaming development
Far Hills, New Jersey 07931 and marketing), from July 1994 until December 1996;
President and Chief Operating Officer, Caesars World
Resorts, Inc. (gaming development), from before 1992
until June 1994.
Aubrey C. Lewis (62)............. On leave from Woolworth Corporation (retail stores),
44 Pleasant Avenue where Mr. Lewis was Vice President-Corporate Liaison,
Montclair, New Jersey 07042 from before
1992 until January 1995. Mr. Lewis is a director of
Bally Total Fitness Holding Corporation.
Celeste Pinto McLain (47)........ Attorney, Celeste Pinto McLain, P.C. (law firm), and
Celeste Pinto McLain, P.C. Arbitrator, American Arbitration Association and IVAMS,
P.O. Box 49835 since before 1992. Ms. McLain is also a director of the
Los Angeles, California 90049 National Passenger Railroad Corporation (Amtrak).
Gilbert L. Shelton (61).......... Private Investor since before 1992. Also, Chief
6467 Leeds Manor Road Executive Officer, Westranch, Inc. (cattle ranching),
Marshall, Virginia 20115 from before 1992 until December 1994.
</TABLE>
HILTON STRONGLY RECOMMENDS THAT YOU VOTE FOR THE HILTON NOMINEES.
ITEM NO. 2 -- THE SALE RESOLUTION
The Sale Resolution urges the Board to sell the Company to Hilton or any
higher bidder. Because Hilton believes its proposal is clearly superior to the
Starwood proposal, Hilton believes that a vote in favor of this resolution
would have the effect of urging the Board to sell the Company to Hilton and to
take all necessary action to permit the Offer and the Proposed Hilton Merger
to proceed. Of course, the Hilton Nominees, if elected would be subject to
fiduciary duties to accept any offer made after their election that is
superior to Hilton's proposal.
HILTON STRONGLY RECOMMENDS THAT YOU VOTE FOR THE SALE RESOLUTION.
ITEM NO. 3 -- THE BYLAWS RESOLUTION
The Bylaws Resolution would repeal any Bylaws adopted by the incumbent Board
on or after July 23, 1996 and prior to the adoption of the resolution. The
Bylaws Resolution is a preventive measure, intended to ensure that any actions
voted on by shareholders, including any actions meant to facilitate the
acceptance of Hilton's Offer, are not nullified by action of the incumbent
Board. While the Company has stated that no Bylaws have been adopted since
July 23, 1996, Hilton believes that the actions of the incumbent Board to date
in resisting and attempting to defeat the Hilton Offer (which were found by a
Nevada Court to have been taken for the primary purpose of entrenchment) make
this preventive measure advisable.
HILTON STRONGLY RECOMMENDS THAT YOU VOTE FOR THE BYLAWS RESOLUTION.
***
5
<PAGE>
IMPORTANT
Your vote is important, regardless of how many Shares you own. Please sign
and date the accompanying WHITE proxy card and mail it in the enclosed self-
addressed envelope (which is postage prepaid for stockholders in the United
States, Canada and the United Kingdom) as promptly as possible, whether or not
you expect to attend the meeting.
Whether or not you have previously signed a blue proxy card sent by ITT
management, we urge you to show your support for the Offer by signing, dating
and promptly mailing the enclosed WHITE proxy card. By signing and dating the
WHITE proxy card, you will revoke any earlier dated blue proxy card solicited
by ITT management which you may have signed. DO NOT RETURN ANY BLUE PROXY CARD
SENT TO YOU BY ITT MANAGEMENT.
IF YOUR SHARES ARE HELD IN THE NAME OF A BANK, BROKER OR OTHER NOMINEE, WE
URGE YOU TO CONTACT THE PARTY RESPONSIBLE FOR YOUR ACCOUNT AND DIRECT HIM OR
HER TO VOTE "FOR" HILTON'S NOMINEES AND "FOR" THE SALE RESOLUTION AND BYLAWS
RESOLUTION ON THE WHITE PROXY CARD.
HILTON HOTELS CORPORATION
HLT CORPORATION
November 3, 1997
6
