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 Commission Only
(as permitted by Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/X/ Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c)
or Section 240.14a-12
CONRAIL INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
NORFOLK SOUTHERN CORPORATION
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN
THE REGISTRANT)
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:
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applies:
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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):
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/ / 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.
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FOR IMMEDIATE RELEASE
December 13, 1996
Media Contact: Robert C. Fort
(757) 629-2714
NS SEEKS INJUNCTION TO STOP POSTPONEMENT OF CONRAIL
SHAREHOLDER VOTE
NORFOLK, VA -- Norfolk Southern Corporation today filed a
motion in U.S. District Court in Philadelphia to block
Conrail, Inc. from postponing a scheduled December 23
meeting at which shareholders are to vote on whether to
"opt out" of Pennsylvania's Fair Value statute.
In its motion for a preliminary injunction, Norfolk
Southern said Conrail and CSX Corporation are "subverting
the processes of corporate democracy" by announcing they
will refuse to allow the vote to proceed unless they are
assured of victory. The motion alleges that this
represents "fundamentally unfair conduct directed at
Conrail's shareholders' most fundamental right - the
right to vote." Norfolk Southern said Conrail and CSX
are allowing shareholders no choice on December 23,
effectively denying them the right to vote against the
proposed amendment to Conrail's charter.
"Permitting defendants to disenfranchise those
shareholders who refuse to opt out of the statute
designed to protect them against coercive, two-tiered
front-end loaded tender offers like the CSX transaction
defeats the purpose and intent" of the Pennsylvania law
and "contravenes the public policy concern for credible
corporate democracy," Norfolk Southern said in its
motion.
Norfolk Southern has offered $110 a share in cash
for all Conrail shares, a $10 billion offer worth at
least $1.3 billion more than CSX's proposal.
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World Wide Web Site - http://www.nscorp.com
FYI: I thought you would be interested in two
developments Thursday in the battle for Conrail:
-- Institutional Shareholder Services, a Bethesda, Md.,
shareholder consulting firm, recommended that
Conrail shareholders vote against a proposal to "opt
out" of Pennsylvania's takeover law. ISS said CSX's
"front-end loaded, two-tiered takeover does not
treat all Conrail shareholders fairly" and that
lock-ups in the agreement have denied them "the
possibility of accepting a higher payment for their
shares." (Please see attached press release issued
by ISS.)
-- The Port Authority of New York said it would urge
federal regulators to break up Conrail's rail
monopoly at the port as a condition for approving
any sale of the railroad. (Please see story on Page
B-4 in the Eastern Edition of today's Wall Street
Journal.)
Deborah Noxon
Norfolk Southern Corporation
757-629-2861
NEWS RELEASE
CSX/CONRAIL MERGER DISRUPTED
ISS RECOMMENDS AGAINST "OPT OUT" PROVISION
FOR IMMEDIATE RELEASE Contact: Marcy J.
Markowitz/(301)215-9507
[email protected]
Bethesda, MD - In a December 12 analysis, Institutional
Shareholder Services (ISS) has recommended AGAINST a
proposal by Conrail Corp. to opt out of a Pennsylvania
fair price provision which would allow CSX Corp. to
complete a merger with Conrail. Norfolk Southern Corp.,
(NS) seeks to tender for Conrail shares at a higher
price.
In his report, Senior Analyst Peter R. Gleason states,
"...CSX's front-end loaded, two-tiered takeover does not
treat all Conrail shareholders fairly, and the lock-ups
contained in the agreement have denied Conrail's
shareholders the possibility of accepting a higher
payment for their shares."
Mr. Gleason met with both Conrail and NS executives
before making his recommendation. His analysis, which
recounts these discussions, is attached. Also attached
is a summary of the analysis, written for The ISS Friday
Report by Mr. Gleason.
Timeline:
October 31 - Conrail sent notices to shareholders that it
would hold a special meeting of shareholders on November
14, 1996, to amend its articles of incorporation to opt
out of Subchapter E of Chapter 25 of the Pennsylvania
Business Corporation Law of 1988. The provision is
Pennsylvania's fair price provision which would inhibit
Conrail's proposed merger with CSX Corp.
October 23 - Norfolk Southern Corp. announced a tender
offer for all outstanding Conrail shares at $100.00 per
share.
November 19 - The U.S. District Court for the Eastern
District of Pennsylvania issued a ruling denying the
Norfolk Southern motion to block competition of the CSX
tender for 19.9 percent of Conrail's common stock. The
decision allowed CSX to continue with its tender offer,
which expired at midnight Wednesday, November 20, 1996.
Norfolk Southern immediately appealed the decision.
November 20 - The U.S. Third Court of Appeals in
Philadelphia rejected Norfolk Southern's emergency
injunction request and cleared the path for CSX Corp. to
acquire 19.9 percent of Conrail's outstanding common
stock in a tender offer valued at $110 per
share. CSX completed the tender offer, which ended at
midnight November 20, 1996, with approximately 85 percent
of Conrail shareholders tendering their shares.
November 26 - Conrail filed definitive proxy materials
with the SEC and set a meeting date of December 23, 1996,
for its shareholder vote to opt out of Pennsylvania's
fair price provision. Norfolk Southern has extended its
previously announced tender offer for Conrail share until
Monday, December 16, 1996.
Peter R. Gleason, Senior Analyst
email: [email protected]
Peter Gleason is a Senior Analyst responsible for
analyses regarding proxy contests, mergers, acquisitions,
and corporate restructurings. He earned a B.A. from
Dartmouth College in 1988, and is a candidate for an
M.B.A. in finance and marketing from Virginia Tech.
Peter started at ISS in 1990 as an Account Representative
in the Sales & Marketing Department and joined the
Domestic Proxy Advisory Service in 1991. In addition to
his work in research, he oversees several consulting
projects for ISS clients. Prior to joining ISS, Peter
was a commercial leasing broker for Cushman & Wakefield,
Inc. in New York and interned on the Government
Securities Trading Desk at Smith Barney Harris Upham,
also in New York.
About ISS
Located in Bethesda, MD, Institutional Shareholder
Services (ISS) is the world's leading provider of proxy
voting and corporate governance services. Serving close
to 400 institutional clients -- as well as trustees,
custodians and corporations throughout North America,
Europe and Australia -- ISS analyzes proxy issues and
recommends votes for approximately 10,000 shareholder
meetings around the world each year.
ISS's main institutional services include Proxy Advisory
and Voting Agent Services, U.S. and Global. Proprietary
software products include ProxyMaster, an electronic
proxy voting and research management tool, and
ProxyRecord, a recordkeeping and reporting package.
ProxyReporter, another ISS software product, is used to
provide consolidated reporting packages to plan sponsors
who delegate voting to their managers. In addition,
ISS's corporate governance consulting services are used
by a number of leading corporations, regulatory and self-
regulatory organizations around the world.
Founded in 1985, ISS is unit of CDA Investment
Technologies, a division of Thomson Financial Services.
For more information on ISS, call Marcy J. Markowitz at
(301)215-9507.
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