===============================================================================
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by registrant / /
Filed by a party other than the registrant /x/ / / Confidential,
for Use of the
Commission Only
Check the appropriate box: (as permitted by
/ / Preliminary proxy statement Rule 14a-6(e)(2))
/ / Definitive proxy statement
/x/ Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
RJR NABISCO HOLDINGS CORP.
----------------------------------------------
(Name of Registrant as Specified in its Charter)
BROOKE GROUP LTD.
------------------------------------------
(Name of Person(s) Filing Proxy Statement)
---------------
Payment of filing fee (Check the appropriate box):
/ / $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / 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:
(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:
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/x/ 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>
For Immediate Release
Contact: George Sard/Anna Cordasco/Paul Caminiti
Sard Verbinnen & Co
212/687-8080
BROOKE SENDS LETTER TO RJR NABISCO SHAREHOLDERS;
SAYS IT'S NOW OR NEVER FOR A NABISCO SPINOFF
----------
MIAMI, FL., MARCH 21, 1996 -- Brooke Group Ltd. (NYSE: BGL) announced today
that it has sent a letter to RJR Nabisco (NYSE: RN) shareholders in support of
its efforts to spin off the Nabisco (NYSE: NA) food business to RJR Nabisco
shareholders. Brooke has nominated a slate of directors to replace the incumbent
RJR Nabisco Board at the Company's Annual Meeting on April 17, 1996. The Brooke
nominees are committed to a comprehensive three-part platform: immediately
spinning off Nabisco, revitalizing the tobacco business, and improving corporate
governance.
The full text of the letter follows:
NOW OR NEVER FOR A NABISCO SPINOFF
To Our Fellow RJR Nabisco Stockholder:
IT'S OFFICIAL: A MAJORITY OF THE RJR NABISCO STOCKHOLDERS ADOPTED OUR SPINOFF
RESOLUTION DEMANDING AN IMMEDIATE SPINOFF OF NABISCO. The Company, however,
still refuses to act, citing possible injunction threats from existing
litigation. The incumbent Board has made it clear that it will not spin off
Nabisco now. IF YOU WANT NABISCO SPUN OFF NOW -- INDEED, IF YOU WANT NABISCO
SPUN OFF EVER -- THERE IS ONLY ONE WAY TO GET IT -- VOTE FOR OUR SLATE.
By now you undoubtedly know about Brooke's comprehensive settlement of the
tobacco litigation. Brooke's settlement addresses all of the injunction
arguments raised by management and gives you a spinoff of Nabisco now. THE
SETTLING PLAINTIFFS HAVE AGREED NOT TO SEEK AN INJUNCTION OF A NABISCO SPINOFF
IF THE BROOKE GROUP NOMINEES ARE ELECTED. Nabisco can be spun off now. It does
not matter whether the settlement agreement is eventually
-more-
<PAGE>
approved in court. It does not matter whether Liggett and RJR Nabisco ever
merge. THERE ARE NO STRINGS ATTACHED TO A SPINOFF OF NABISCO.
Management, to protect itself, has generated rumors and misinformed you about
the settlement. NO MERGER BETWEEN LIGGETT AND RJR NABISCO IS REQUIRED BY THE
SETTLEMENT. NO MERGER CAN OR WILL BE EFFECTED WITHOUT STOCKHOLDER APPROVAL. NO
MERGER IS NECESSARY FOR YOU TO GET THE SPINOFF.
As an RJR Nabisco stockholder, you are entitled to get Nabisco now. IF YOU DON'T
VOTE FOR OUR SLATE YOU ARE GIVING UP A FREE PASS -- AND REJECTING THE SPINOFF.
WHY DID WE SETTLE?
No one we've talked to believes that, in the present environment, the
tobacco litigation will go away. We concluded that it was in our best interests
- -- and we think it is in the best interests of the entire tobacco industry -- to
seek a responsible compromise.
Our compromise forthrightly addresses concerns of the healthcare community
about matters such as underage smoking and advertising to juveniles, while
assuring that those who choose to smoke may continue to do so. We believe that
our settlement with the class action plaintiffs and the Attorneys General offers
an alternative economic model to that of ever escalating litigation costs and
confrontation, which prevails elsewhere in the industry. Any sensible management
would have sought such a settlement solution. IT TOOK SOMEONE WHO WAS NOT
ENTOMBED IN THE RJR NABISCO BOARDROOM (OR DESTINED TO RETIRE UNDER ITS DIRECTOR
PENSION PLAN) TO PROVIDE A CREATIVE SOLUTION TO THE LITIGATION THREAT, WHICH IS
IN THE LONG-TERM FINANCIAL INTERESTS OF THE ENTIRE TOBACCO INDUSTRY.
The settlement with the Attorneys General releases Brooke and Liggett from
claims by five states, Florida, Louisiana, Massachusetts, Mississippi and West
Virginia, which have filed tobacco-related Medicaid reimbursement suits. The
settlement with the class action plaintiffs would release Brooke and Liggett
from all current and future addiction based claims by a nationwide class of
smokers. We have enclosed copies of Brooke's press releases describing these
settlements. The tobacco industry's winning record before juries has been
founded in great part on the public's appreciation of the voluntary nature of
smoking. The addiction theory asserted by the federal government and the civil
plaintiffs is meant to disprove this free choice notion. Our settlement covers
the civil actions that arise or could arise out of all nicotine addiction
claims.
-more-
<PAGE>
YOU MAY HAVE HEARD CRITICISM OF THE SETTLEMENT, that it will stir up
additional litigation. The press reported recently that three more industry
whistle-blowers are stirring industry-wide investigations about nicotine
addiction, there are five ongoing Federal grand jury investigations, tarring the
industry with what approaches outlaw status, and numerous senior industry
executives have hired criminal defense counsel.* These are ongoing actions,
which arose well before our settlements were announced. OUR SETTLEMENT DID NOT
PRECIPITATE, AND DID NOT ADD TO, THE EXPOSURE PRESENTED BY THESE MATTERS.
REMEMBER, THE SAME MANAGEMENT THAT CRITICIZES OUR SETTLEMENT AS UNNECESSARY
BECAUSE THEY CLAIM THE TOBACCO LITIGATION IS RISK-FREE, TREMBLES AT THE IDEA OF
AN IMMEDIATE SPINOFF BECAUSE OF LITIGATION THREATS . . . Such inconsistency does
not trouble the management. It should trouble you. The settlement frees up
Nabisco and ends the Company's paralysis. Considering the ongoing investigative
zeal, WILL THERE EVER BE ANOTHER WINDOW OF OPPORTUNITY TO SPIN OFF NABISCO? NOW
IS THE TIME.
YOUR VOTE DOES NOT SPEAK TO OR ENCOURAGE ANY MERGER TRANSACTION. BROOKE'S
SETTLEMENT DOES NOT REQUIRE A MERGER WITH RJR NABISCO. Your vote is solely for
the election of a slate of directors that will effect an immediate spinoff of
Nabisco. NO MERGER CAN OR WILL BE EFFECTED WITHOUT A SEPARATE VOTE OF THE RJR
NABISCO STOCKHOLDERS.
MANAGEMENT'S UNIMPRESSIVE ACTIONS
The Company recently announced that it was increasing the annual dividend
to $1.85 per common share. It is important to remember that the Company has not
increased the tobacco dividend by one cent -- it is just a pass-through from
Nabisco. The Company has stated that the 35 cent increase in the dividend is
equivalent to the amount of dividend income it currently receives from its
ownership of Nabisco. THE COMPANY IS PROCLAIMING A DIVIDEND INCREASE BASED ON
DIVIDENDS IT RECEIVES FROM NABISCO SHARES THAT YOU HAVE EMPHATICALLY DEMANDED BE
SPUN OFF IMMEDIATELY. It is a leaden response. Instead of true value-creating
alternatives, management is again resorting to financial trickery and gimmicks.
FOR STARTERS, THE BROOKE GROUP NOMINEES INTEND TO INCREASE THE TOBACCO
COMPANY DIVIDEND TO APPROXIMATELY $2.00 PER SHARE. This would be in addition to
the 35 cent dividend you would receive on the Nabisco shares spun off to you.
The Company also announced a share repurchase "objective" of 10 million
shares over the next "several years" based on the "achievement of performance
targets" and an authorization by the Board to repurchase up to
-more-
<PAGE>
$100 million of common stock in 1996. THIS UNIMPRESSIVE RESPONSE UNDERSCORES THE
COMPANY'S CONTINUING INABILITY TO UNDERSTAND THAT STOCKHOLDERS WANT MORE!
THERE IS NO REASON TO SETTLE FOR TOKENS FROM INCUMBENT MANAGEMENT WHEN A
NEW BOARD WILL COMMIT TO VALUE-ENHANCING ACTION AND WILL INJECT RENEWED VITALITY
INTO THE TOBACCO COMPANY. For example, the Brooke Group Nominees intend to
appoint Ronald Fulford, formerly the executive chairman of Hanson PLC's Imperial
Tobacco, to serve as President and Chief Executive Officer of the Company. Mr.
Fulford engineered the dramatic turnaround at Britain's second largest tobacco
maker: operating profit rose from (pound)127 million in fiscal 1987 to
(pound)348 million in fiscal 1995. MR. FULFORD, AN ACCOMPLISHED MANAGER WITH A
FLAIR FOR MARKETING, TURNED A SLEEPY CIGARETTE COMPANY INTO AN ADMIRED
COMPETITOR.
You now have a clear choice between the Brooke Group Nominees and the
incumbent directors and management. THE BROOKE GROUP NOMINEES HAVE PRESENTED AN
INNOVATIVE PROGRAM AND WILL GIVE YOU: AN IMMEDIATE SPINOFF OF NABISCO, A $2.35
PER SHARE DIVIDEND ($2.00 FROM THE TOBACCO COMPANY AND $.35 FROM NABISCO), RON
FULFORD REVITALIZING THE TOBACCO BUSINESS AND IMPROVED CORPORATE GOVERNANCE.
BROOKE GROUP, and entities committed to an immediate spinoff of Nabisco,
together own OVER 6.6% of the outstanding Common Stock, while THE INCUMBENT
DIRECTORS AND MANAGEMENT OWN LESS THAN 1/2 OF 1%. We have been buying stock
because we believe it is undervalued and there is a long-term future for the
Company in the tobacco industry. WE ARE COMMITTED TO STOCKHOLDER VALUE, THE
INCUMBENT BOARD IS COMMITTED TO BUSINESS AS USUAL, HOPING THE STOCKHOLDERS WILL
SELL THEIR STOCK AND LEAVE THE DIRECTORS ALONE. It is time to retire the
incumbent directors and give them their pensions.
ELECT OUR SLATE OF DIRECTORS TO SPIN OFF NABISCO AND GET BACK TO RUNNING
THE TOBACCO COMPANY AS A REAL BUSINESS, USING ITS CASH FOR THE BENEFIT OF THE
STOCKHOLDERS.
No matter how many shares you own, your support is important. Do not delay
in responding to this call for action. Now is the time to act. SIGN AND MAIL THE
ENCLOSED BLUE PROXY CARD TO REPLACE THE UNRESPONSIVE INCUMBENT BOARD.
Very truly yours,
BENNETT S. LEBOW
Chairman of the Board, President
and Chief Executive Officer
P.S. If you have any questions or comments about our solicitation, or if you
need a copy of our proxy material, please call Georgeson & Company Inc. at
1-800-SPINOFF. If you are interested in gaining access to information about
our solicitation on the World Wide Web, use http://www.brookegroup.com or
http://www.georgeson.com.
- ----------
CERTAIN ADDITIONAL INFORMATION: Ronald Fulford, who may be deemed a participant
in the solicitation by Brooke Group Ltd. of proxies with respect to the Brooke
Group nominees set forth in its Proxy Statement currently on file with the
Securities and Exchange Commission, purchased 15,000 shares of RJR Nabisco
Holdings Corp. common stock (the "Common Stock") on March 1, 1996. Due to a
computing error, the monthly compensation and per annum pension benefit payable
to Mr. Fulford described in Brooke's Proxy Statement should have read
UK(pound)33,417 (or approximately US$51,128) and UK(pound)14,400 (or
approximately US$22,032), respectively. Richard J. Lampen, who may be deemed a
participant in Brooke Group's solicitation, purchased 2,000 shares of Common
Stock on March 19, 1996.
- --------
* The New York Times (March 18, 1996) and The Wall Street Journal (March 18,
1996 and March 19, 1996).
Brooke Group controls Liggett Group, tobacco and real estate operations in the
former Soviet Union and has a substantial equity interest in New Valley
Corporation.
