ADVERTISEMENT APPEARING IN NEWSPAPERS COMMENCING JUNE 26, 1998
AN INDEPENDENT ASSESSMENT
OF THE J.C. NICHOLS/HIGHWOODS MERGER
Institutional Shareholder Services (ISS), the world's leading, independent
provider of proxy voting and corporate governance services, recently issued a
report regarding the proposed Highwoods transaction.*
In the conclusion to its 12 page report, ISS said;
"ISS BELIEVES THAT THE JCN BOARD AND MANAGEMENT HAVE MADE A GOOD-FAITH
EFFORT TO OBTAIN A FAIR VALUE ON BEHALF OF SHAREHOLDERS, BOTH WITH
HIGHWOODS AND IN THEIR WILLINGNESS TO ALLOW OTHER PARTIES...TO CONDUCT DUE
DILIGENCE....BASED ON THE CERTAINTY OF THE OFFER, THE ATTRACTIVE OFFER
PRICE, THE DIVIDEND PAYMENT, MORGAN STANLEY'S FAIRNESS OPINION, AND THE
STRATEGIC BENEFITS THAT WILL ACCRUE FROM THE TRANSACTION, WE BELIEVE THE
MERGER AGREEMENT WARRANTS SHAREHOLDER SUPPORT."
"WE RECOMMEND A VOTE FOR THE MERGER AGREEMENT."
You may be aware that Blackacre Capital Management LLC, a private New York based
investment fund, is making a last minute attempt to convince you they will offer
$70 per share for the J.C. Nichols Company.
You should know the following:
o THE BLACKACRE OFFER IS HIGHLY CONDITIONAL.
The Blackacre offer depends upon the completion of due diligence - which
they themselves had said would be "simplest" if started after the vote on
the Highwoods merger has taken place.
o THERE IS NO GUARANTEE AN OFFER WILL BE MADE.
If the Highwoods offer is voted down, Blackacre is under no obligation to
make an offer at any price.
They have said nothing in their letters or advertisements that commits them
to making an offer at any price.
o BLACKACRE HAS INDICATED THAT IT WILL NOT TERMINATE THE ESOP TRUST.
Highwoods' termination of the ESOP Trust will allow full distribution to
all ESOP participants.
In its independent report, ISS said the following:
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"The prices proposed by Intell and Cerberus [Blackacre] may be tantalizing,
but neither party is under any obligation to complete a transaction at any
price. Indeed, a defeat of the Highwoods merger could entice either one to
come back with a lowball bid.
"....[Blackacre] has been involved with JCN for almost a year, which makes
its decision to enter the bidding fray only two weeks before the
shareholders' meeting striking....[I]t is clearly bent on impeding the
Highwoods deal."
The J.C. Nichols Board of Directors continues to believe that the Highwoods
transaction serves the best interests of all shareholders, including ESOP
participants, and urges you to vote FOR the merger at the July 1 meeting.
*Neither J.C. Nichols nor Highwoods is a member of ISS or pays ISS for its
reports.
