<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
[Amendment No.........................]
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
Milwaukee Land Company
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(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(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:
*Set forth the amount on which the filing fee is calculated and state
how it was determined.
[_] 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>
MILWAUKEE LAND COMPANY
547 W. JACKSON BLVD.
CHICAGO, ILLINOIS 60661
June 24, 1996
Dear Stockholder:
You are invited to attend the Annual Meeting of Stockholders of
Milwaukee Land Company which will be held on Tuesday, August 6, 1996 at 10:00
A.M. local time, at The LaSalle National Bank, 135 South LaSalle Street, Suite
260, Chicago, Illinois 60603.
The matters scheduled for consideration at the Annual Meeting are (i)
the election of a director for a three year term and (ii) the ratification of
the Board of Directors' selection of Ernst & Young LLP as independent auditors
for the Company for 1996. The Notice of Meeting and Proxy Statement which
appear on the following pages contain details on these matters, to which you are
urged to give your attention.
Whether or not you intend to be present in person or to be otherwise
represented at the meeting, you are requested to complete, sign and date the
enclosed proxy card and return it in the enclosed envelope. This action will
not limit your right to revoke your proxy in the manner described in the
accompanying Proxy Statement or to vote in person if you wish to attend the
Annual Meeting and vote personally.
Sincerely,
/s/ CLARENCE G. FRAME
Clarence G. Frame
Chairman of the Board
<PAGE>
MILWAUKEE LAND COMPANY
547 W. JACKSON BLVD.
CHICAGO, ILLINOIS 60661
Notice of Annual Meeting of Stockholders
To Be Held on August 6, 1996
Chicago, Illinois
June 24, 1996
The Annual Meeting of Stockholders of Milwaukee Land Company will be
held at The LaSalle National Bank, 135 South LaSalle Street, Suite 260, Chicago,
Illinois 60603 on Tuesday, August 6, 1996, at 10:00 A.M. local time, for the
following purposes:
1. Election of one director for a term of three years;
2. Ratification of the Board of Directors' selection of Ernst & Young LLP
as independent auditors of the Company for 1996; and
3. Transaction of such other business as may properly come before the
meeting or any adjournment or adjournments thereof.
The Board of Directors has fixed the close of business on Friday, June 21,
1996, as the record date for the determination of stockholders entitled to
notice of, and to vote at, the meeting and at any adjournment or adjournments
thereof.
Whether or not you intend to be present in person or to be otherwise
represented at the meeting, you are requested to complete, sign and date the
enclosed proxy card and return it in the enclosed envelope. This action will
not limit your right to revoke your proxy in the manner described in the
accompanying Proxy Statement or to vote in person if you wish to attend the
Annual Meeting and vote personally.
By order of the Board of Directors
/s/ LEON F. FIORENTINO
Leon F. Fiorentino
Secretary
<PAGE>
MILWAUKEE LAND COMPANY
547 W. JACKSON BLVD.
CHICAGO, ILLINOIS 60661
PROXY STATEMENT
---------------
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON AUGUST 6, 1996
---------------
This proxy statement is furnished to the stockholders of Milwaukee
Land Company (the "Company" or "MLC") in connection with the solicitation of
proxies by the Board of Directors of the Company for use at the Annual Meeting
of Stockholders of the Company (the "Annual Meeting") to be held on Tuesday,
August 6, 1996, at 10:00 A.M. local time, at The LaSalle National Bank, 135
South LaSalle Street, Suite 260, Chicago, Illinois 60603, and at any adjournment
or adjournments thereof, for the purposes set forth in the accompanying Notice
of Annual Meeting. This Proxy Statement and the accompanying form of proxy are
first being mailed to stockholders of the Company on or about June 24, 1996.
The enclosed form of proxy, if executed, may be revoked by the person
giving it at any time before it is voted by giving written notice of revocation
to the Secretary of the Company. Unless otherwise directed, properly executed
proxies received by the Company prior to the close of polls will be voted FOR
the election of the person listed herein as nominee to the Board of Directors of
the Company, FOR the ratification of the Board of Directors' selection of Ernst
& Young LLP as independent auditors of the Company for 1996 and, on other
business that may properly come before the Annual Meeting, as the named proxies
in their sole discretion decide. If a contrary specification has been made on
the proxy, the shares will be voted in accordance with the specification.
The close of business on Friday, June 21, 1996, is the date fixed by
the Board of Directors for the determination of stockholders of record entitled
to notice of, and to vote at, the Annual Meeting. On June 21, 1996, there were
issued and outstanding 1,671,238 shares of Common Stock, par value of $.30, of
the Company ("Common Stock"). Each share is entitled to one vote with respect
to each matter to be voted upon. At all meetings of the stockholders at which a
quorum is present, a plurality of the votes cast shall elect directors.
Consequently, only shares that are voted in favor of a particular nominee will
be counted toward such nominee's attaining a plurality. Shares present at the
meeting that are not voted for a particular nominee or shares present by proxy
where the stockholder properly withholds authority to vote for such nominee
(including broker non-votes) will not be counted toward such nominee's
attainment of a plurality.
The Company's 1995 Annual Report, which includes the Company's
statement of assets and liabilities at December 31, 1995, statement of
operations for the fiscal year ended December 31, 1995 and statement of changes
in net assets for the fiscal years ended December 31, 1995 and 1994, was mailed
to stockholders prior to the mailing of the Proxy Statement. Any stockholder
may obtain a copy of the 1995 Annual Report, without charge, by contacting the
Secretary of the Company at 547 W. Jackson Blvd., Suite 1510, Chicago, IL 60661
or by calling (800)962-6247.
<PAGE>
The Board of Directors of the Company is soliciting proxies from
stockholders for use at the Annual Meeting. The expense of this solicitation
will be borne by the Company. Officers and employees of the Company, in the
ordinary course of business and at nominal expense, may supplement this
solicitation by mail, telephone call, telegraph or letter, for which they will
be reimbursed for out-of-pocket expenses but will receive no additional
compensation. The Company has retained D.F. King & Co., Inc. to assist in the
distribution of proxy solicitation materials and with the solicitation of
proxies, at a cost of approximately $4,000. Brokers or other persons holding
stock in their names or in the names of their nominees will, upon request, be
reimbursed for their actual expenses in forwarding proxies and proxy material to
the beneficial owners of such stock.
1. ELECTION OF DIRECTOR
The Board of Directors is divided into three classes. The director or
directors of each class will be elected by holders of the Common Stock at the
annual meeting of stockholders held in the year in which the term for such class
expires and will serve thereafter for three years. The terms of office for the
Class I director expires in 1997, for the Class II directors in 1998 and for the
Class III director in 1996. The Board of Directors has nominated Mr. Edwin
Jacobson for election as a Class III Director of the Company for a three year
term expiring at the Annual Meeting of Stockholders in 1999. Mr. Jack Nash
served as a Class III Director until his resignation on January 17, 1996. The
Board of Directors has chosen not to fill this vacancy at this time.
The following table sets forth certain information with respect to the
current directors and the nominee for election as director:
<TABLE>
<CAPTION>
Position(s) Held With MLC,
Directorships of Publicly-Held Companies and
Name Age Principal Occupation During Past 5 Years
- ---- --- --------------------------------------------
<S> <C> <C>
Board of Directors Nominee for
Class III Director
Edwin Jacobson*................... 67 President, Chief Executive Officer (since
September 1990) and Director of MLC (Class
III) (since November 1985); President, Chief
Executive Officer and Director of Chicago
Milwaukee Corporation ("CMC")** MC (since
November 1985); member of the Executive and
Investment Committees of MLC; President and
Chief Executive Officer (since February 27,
1994) and Chairman of the Executive Committee
(since June, 1992) of Avatar Holdings Inc.
(real estate, water and wastewater utilities
operations).
Continuing Directors
Class I Director
Robert S. Davis................... 81 Director of MLC (Class I) (since October
1988); Chairman of the Audit Committee of
MLC; self-employed consultant (for more than
the past five years); Senior Vice President
(1978-79), St. Paul Companies (insurance),
St. Paul Minnesota.
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
Position(s) Held With MLC,
Directorships of Publicly-Held Companies and
Name Age Principal Occupation During Past 5 Years
- ---- --- --------------------------------------------
<S> <C> <C>
Class II Directors
Clarence G. Frame*................ 77 Chairman of the Board of MLC (since September
1990); Director of MLC (Class II) (since
November 1985); member of the Executive and
Investment Committees of MLC; Chairman of the
Board of CMC (since June 1985) and Director
of CMC (since 1980); Chairman of the Board
(1984 - 1989) and Chief Executive Officer
(1986-1989), Tosco Corporation (oil refiner),
Stamford, Connecticut. Mr. Frame also serves
as a Director for Independence One Mutual
Funds***, Voyaguer Mutual Funds*** and Tosco
Corporation.
Ezra K. Zilkha.................... 70 Director of MLC (Class II) (since October
1988); member of the Executive and Audit
Committees and Chairman of the Investment
Committee of MLC; Director of CMC (since
1981); President and Director (since 1956)
Zilkha & Sons, Inc. (investments), New York,
New York. Mr. Zilkha is also a Director of
Newhall Land and Farming Company and was a
Director of Cigna Corporation until April 24,
1996.
</TABLE>
- ------------------
*Directors who are "interested persons" of the Company, as defined in the
Investment Company Act of 1940, as amended, by virtue of their status as
officers of the Company.
**On May 8, 1995, CMC adopted a plan of complete liquidation. CMC has redeemed
all outstanding shares of its common stock and will seek to terminate its
registration as an investment company.
***Mr. Frame serves as a trustee/director of 42 funds in the Independence One
Mutual Funds complex and 5 funds in the Voyaguer Mutual Funds complex.
Meetings of the Board of Directors and Committees
During 1995, the Board of Directors of the Company held four meetings. The
Board of Directors has established an Executive Committee, an Audit Committee
and an Investment Committee. The Executive Committee, comprised of Messrs.
Frame, Jacobson, Nash and Zilkha, did not hold a meeting in 1995. The Executive
Committee, subject to certain exceptions, is empowered to assume the power of
the Board of Directors when it is not in session, including the functions of
compensation review and board nominations. The Audit Committee held one meeting
in 1995. Messrs. Davis and Zilkha are members of the Audit Committee. The
principal functions of the Audit Committee are: to select the Company's
independent auditor; approve the overall scope of the audit; review results of
the operations of the Company; and review the Company's system of internal
controls. The Investment Committee, which includes Messrs. Frame, Jacobson,
Nash and Zilkha, did not hold a meeting in 1995. The Investment Committee was
established in early 1986 to provide investment policies and guidelines to the
management of the Company. Each director attended 75% or more of the total
number of meetings of the Board of Directors and meetings of all committees of
the Board of Directors on which he serves.
3
<PAGE>
Executive Officers
The following table sets forth certain information with regard to executive
officers of the Company who do not serve as directors.
<TABLE>
<CAPTION>
Position(s) Held with the
Company and Principal
Name Age Occupation During Past 5 Years
- ---- --- --------------------------------
<S> <C> <C>
Lawrence S. Adelson............... 46 Vice President and General Counsel of the
Company (since October 1988); Vice President
and General Counsel of CMC (since November
1988); General Counsel of CMC Real Estate
Corporation (1985 - 1989).
Leon F. Fiorentino................ 71 Vice President - Finance, Secretary and
Treasurer (since September, 1990); Vice
President - Finance (since May 1981),
Treasurer (since May 1982) and Secretary
(since May 1984) of CMC.
</TABLE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Security Ownership of Certain Beneficial Owners
Set forth below is certain information concerning persons who are known by the
Company to be beneficial owners of more than 5% of the outstanding shares of the
Company's Common Stock as of the date shown in the corresponding footnote.
<TABLE>
<CAPTION>
Number of
Shares of Percent
Name and Address of Common of
Beneficial Owner (i) Stock Owned Class
-------------------- ----------- --------
<S> <C> <C>
Schedule 13D Group(ii)
- --Ezra K. Zilkha
767 Fifth Avenue
New York, New York 10153 87,500 5.2%
------- ----
Schedule 13D Group(iii)
- --Orion Capital Corporation
30 Rockefeller Plaza
New York, New York 10112 113,100 6.8%
------- ----
Spears, Benzak, Salomon & Farrell, Inc.(iv)
45 Rockefeller Plaza
New York, New York 10111 283,492 16.9%
------- ----
MSR Capital Partners (v)
One Embaracadero Center - Suite 2330
San Francisco, CA 94111 106,000 6.3%
------- ----
</TABLE>
4
<PAGE>
(i) Nature of ownership is direct, except as otherwise indicated herein.
(ii) Based on a statement filed on Schedule 13D, as amended through January
10, 1996, this Schedule 13D Group currently consists of Ezra K. Zilkha,
The Zilkha Foundation, Inc. and Zilkha & Sons, Inc. All shares are held
directly with sole voting and investment power except for 1,500 shares
owned by Ezra Zilkha's wife, as to which Mr. Zilkha shares voting and
dispositive power, 15,000 shares owned by the Zilkha Foundation, Inc. as
to which Mr. Zilkha may be deemed to share voting and dispositive power
with the other directors and officers of this foundation and 24,500
shares owned by Zilkha & Sons, Inc. as to which Mr. Zilkha may be deemed
to be a beneficial owner.
(iii) Based on a statement filed on Schedule 13D, as amended through July 28,
1993, this Schedule 13D Group currently consists of Orion Capital
Corporation, six of Orion's wholly-owned subsidiaries (Connecticut
Specialty Insurance, Design Professionals Insurance Company, EBI
Indemnity Company, The Fire & Casualty Insurance Company of Connecticut,
Security Insurance Company of Hartford and Security Reinsurance Company),
Guaranty National Corporation, an affiliate of Orion, and Guaranty
National Insurance Company, a subsidiary of Guaranty National
Corporation. No member of the Schedule 13D Group except Orion Capital
Corporation beneficially owned in excess of 5% of the outstanding shares
of Common Stock of the Company. Orion Capital Corporation may be deemed
to be the beneficial owner of all the Common Stock of the Company owned
by the subsidiaries and the affiliates.
(iv) Based on a statement filed on Schedule 13G, as amended through December
31, 1995, Spears, Benzak, Salomon & Farrell, Inc. ("Spears") serves as an
investment advisor for a variety of individuals, groups and corporations
with whom Spears shares the power to dispose or direct the disposition of
such shares of the Company's Common Stock with various customers for whom
the shares were purchased. However, in each case the customer has the
ultimate power to dispose and may at any time revoke Spears' authority to
dispose. Spears has no power to vote or direct the vote of such shares.
(v) Based on a statement filed on Schedule 13D dated January 10, 1996, MSR
Capital Partners, a California Limited Partnership organized to purchase,
hold for investment and sell marketable securities, has sole voting and
dispositive power with respect to the shares owned.
Security Ownership of Management
Set forth in the following table is certain information concerning the
beneficial ownership of the Company's Common Stock by each director, each
nominee for election as director and by all directors, officers and nominees as
a group as of March 14, 1996:
<TABLE>
<CAPTION>
Number of
Name of Beneficial Shares of Percent
Owner and Number of Common of
Persons in Group(i) Stock Owned Class
-------------------- ----------- --------
<S> <C> <C>
Robert S. Davis.................................. 300 --%
Clarence G. Frame................................ 500 --%
Edwin Jacobson................................... 0 0%
Ezra K. Zilkha(ii)............................... 87,500 5.2%
All directors, officers and
nominees of the Company
(7 persons)..................................... 88,300 5.2%
</TABLE>
5
<PAGE>
(i) Nature of ownership is direct, except as otherwise indicated herein.
Unless shown, ownership is less than 1% of class.
(ii) Mr. Zilkha is a member of a Schedule 13D Group previously described,
which collectively owns approximately 5.2% of the outstanding shares of
the Company's Common Stock. Included in the table are 1,500 shares owned
by Mr. Zilkha's wife to which Mr. Zilkha shares voting and dispositive
power, 15,000 shares owned by The Zilkha Foundation, Inc. as to which Mr.
Zilkha may be deemed to share voting and dispositive power with the
directors and officers of this foundation and 24,500 shares owned by
Zilkha & Sons, Inc. as to which Mr. Zilkha may be deemed to be a
beneficial owner.
EXECUTIVE COMPENSATION
The following table sets forth the cash compensation paid by MLC for
the fiscal year ended December 31, 1995 to (i) each of the directors of the
Company and (ii) to the executive officer of the Company whose aggregate
compensation paid by the Company exceeded $60,000, and (iii) to each director of
the Company by the Company and CMC in the aggregate.
<TABLE>
<CAPTION>
Total Compensation
Aggregate From the Company
Compensation and CMC Paid
Name and Position From the Company to Directors(i)
------------------ ---------------- ------------------
<S> <C> <C>
Robert S. Davis.................................................................... $11,063 $ 15,001
Director
Clarence G. Frame.................................................................. $18,750 $ 25,000
Director, Chairman of the Board of Directors
Edwin Jacobson..................................................................... $90,000 $100,000
Director, President and Chief Executive Officer
Jack Nash.......................................................................... $10,500 $ 14,250
Director
Ezra K. ZilKha..................................................................... $ 9,375 $ 12,938
Director
</TABLE>
The Company does not maintain any pension, profit-sharing, option, stock,
bonus or similar plan for its officers and directors. Insurance benefit
programs are non-discriminatory. The Company does have a deferred compensation
arrangement available to its officers and directors.
__________________
(i) During 1995, the directors of the Company were also directors of CMC, which
as of the date hereof is no longer a public company.
(ii) The compensation received by Mr. Jacobson from the Company was in his
capacity as President and Chief Executive Officer of the Company. Mr.
Jacobson is also a director and President and Chief Executive Officer of
CMC. During 1995, Mr. Jacobson received $10,000 from CMC for his services
as President and Chief Executive Officer of CMC. Mr. Jacobson does not
receive any compensation from either the Company or CMC for his services as
director.
6
<PAGE>
Employment Agreement
Edwin Jacobson, the President and Chief Executive Officer of the Company,
has entered into an employment agreement (the "Employment Agreement") with the
Company. Pursuant to this Employment Agreement, Mr. Jacobson will continue to
serve as the President and Chief Executive Officer of the Company for a period
of five years commencing on June 30, 1993. The Employment Agreement provides
for an annual base salary of $90,000, all or a portion of which may be deferred
at Mr. Jacobson's election.
During the term of the Employment Agreement, Mr. Jacobson will have the
right to continue his employment with CMC and CMC Heartland Partners ("CMC
Heartland") and to pursue other employment and business activities not in
competition with the activities of the Company (after prior notice of such
activities has been delivered by him to the Chairman of the Executive Committee
of the Board of Directors of the Company), and will not be obligated to devote
full time to the activities of the Company. Mr. Jacobson will, however, be
required to devote an amount of time to the activities of the Company determined
by the Board of Directors of the Company to be required of him to accomplish the
business objectives of the Company.
2. RATIFICATION OF SELECTION OF AUDITORS
The Board of Directors recommends that the stockholders ratify the
Board of Directors' selection of Ernst & Young LLP as independent auditors for
the Company for the year ending December 31, 1996. Ernst & Young LLP has served
as the Company's principal auditor since 1993.
For the year ended December 31, 1995, Ernst & Young LLP examined the
financial statements of the Company and provided consultation on financial
accounting and reporting matters. Representatives of Ernst & Young LLP met with
the Audit Committee on February 23, 1996 to discuss the results of the 1995
annual audit and other matters. Audit fees and expenses for the 1995 annual
audit amounted to approximately $11,500. Representatives of Ernst & Young LLP
will be present at the Annual Meeting and will have an opportunity to make a
statement if they desire to do so. They also will be available to respond to
appropriate questions presented at the Annual Meeting.
INTERESTS IN PARTNERSHIPS AND RELATED TRANSACTIONS
At the close of business on June 27, 1990, CMC and the Company
transferred to CMC Heartland at the direction of Heartland Partners, L.P.
("Heartland"), substantially all of their respective real estate properties and
certain miscellaneous assets and liabilities related to those properties.
The Company has a 1% general partnership interest in Heartland which
entitles the Company to 1% of Heartland's available cash for distribution and
allocation of taxable income and loss. The Company also has a .01% general
partnership interest in CMC Heartland which entitles the Company to .01% of CMC
Heartland's available cash for distribution and an allocation of taxable income
and loss before distributions and allocations are made by Heartland. The
Company's interests in Heartland and CMC Heartland (collectively, the
"Partnerships"), together with the Class B Interest referred to below, are
included in investments and were valued at approximately $9,159,000 at December
31, 1995.
The Company, by reason of its serving as the general partner of the
Partnerships, is liable and responsible to third parties for such partnerships'
liabilities to the extent the assets of such partnerships are insufficient to
satisfy such liabilities. In addition to liabilities incurred as a result of
their ongoing real estate business, and in connection with the real estate
transfer, the Partnerships have assumed primary responsibility and liability for
the resolution and satisfaction of most of the liabilities for claims remaining
under the plan of reorganization of the predecessor of CMC Real Estate
Corporation ("CMCRE"), formerly a wholly owned subsidiary of CMC, and previously
named the Chicago, Milwaukee, St. Paul and Pacific Railroad Company
(the"Railroad"), certain other
7
<PAGE>
contingent liabilities with respect to the properties transferred to CMC
Heartland arising after the consummation of such plan, and the costs and
expenses in resolving such plan and other contingent liabilities (collectively,
the "Plan Liabilities"). Included in the Plan Liabilities are known
environmental liabilities associated with certain of the properties transferred
to the Partnerships arising out of the activities of the Railroad or certain
lessees or other third parties. Further environmental obligations as yet unknown
in respect of these properties may become due and owing in the future. A
majority of the known environmental matters stem from the use of petroleum
products, such as motor oil and diesel fuel, in the operation of a railroad, the
primary business of the Railroad. The Company and/or the Partnerships have been
notified by governmental agencies of potential liabilities in connection with
certain of these real estate properties.
CMC was required to contribute to Heartland, over time, cash in the
amount of $18.1 million (the "Deferred Capital Contribution"), plus interest,
for settlement of the Plan Liabilities. In consideration of such commitment,
Heartland issued to CMC the Class B limited partnership interest (the "Class B
Interest"). On August 28, 1990 and February 15, 1991, pursuant to an
authorization of the Board of Directors of CMC on May 7, 1990, CMC made
additional capital contributions to Heartland of approximately $3.6 million in
the aggregate, representing an increase in CMC's Class B Interest in Heartland.
As part of CMC's conversion from a closed-end management investment company to
an open-end management investment company (the "Conversion), the Class B
Interest was transferred to the Company on July 1, 1993. In general, the Class
B Interest entitles the holder to .5% of Heartland's available cash for
distribution and allocation of taxable income and loss. In addition, items of
deduction, loss, credit and expense attributable to the satisfaction of Plan
Liabilities are specially allocated 99% to the holder of the Class B Interest
and 1% to the Company as the general partner until the aggregate amount of all
such items allocated to the Class B Interest equals the aggregate capital
contribution with respect to the Class B Interest. If the aggregate amount of
such items specially allocated to the holder of the Class B Interest is less
than the amounts contributed by such holder to Heartland, such excess will be
reflected in the capital account of the Class B Interest.
In connection with the Conversion, CMC assigned to the Company, and
the Company assumed from CMC any obligations for which CMC is or may become
liable (the "MLC Assumed Liabilities") arising out of any matters existing on or
occurring prior to the effective time of the Conversion other than (i) the Plan
Liabilities, (ii) liabilities directly related to CMC's business of investing
and managing its investment securities, (iii) the lawsuit pending against CMC
relating to its preferred stock, or (iv) any liabilities relating to federal,
state, local or foreign income or other tax matters. CMC will continue to
remain liable to third party obligees in connection with the MLC Assumed
Liabilities. The Company will indemnify CMC for any and all damages, costs or
expenses that CMC may incur in connection with the MLC Assumed Liabilities,
although there can be no assurance that the Company will be able to fully
satisfy such indemnification obligations.
Effective July 1, 1993, CMC transferred its rights and obligations
under the management agreement with CMC Heartland to the Company (other than the
right to fees accrued through the date of such transfer). Pursuant to the
management agreement, CMC Heartland is required to pay to the Company an annual
management fee in the amount of approximately $425,000. At the discretion of
Heartland, the management fee may be accrued and not paid for up to 5 full years
after the real estate transfer. CMC Heartland paid approximately $648,000 to the
Company on December 29, 1995 for management fees accrued through December 31,
1994. The management fee for 1995, approximatley $425,000, was paid on February
14, 1996. The Company advanced CMC Heartland approximately $648,000 on December
29, 1995 and advanced an additional $425,000 on February 14, 1996. Each advance
is in the form of a note payable on demand and bearing interest at the prime
rate plus 2.25% (10.75% at December 31, 1995).
CMC distributed the Common Stock of the Company to CMC's common
stockholders after the close of business on June 30, 1993 as part of the
conversion (the "Distribution"). One share of the Company's Common Stock was
distributed for each share of CMC's Common Stock that was held as of June 18,
1993, the record date for the distribution. The Company's Common Stock is now
traded on the American Stock Exchange under the symbol MWK.
8
<PAGE>
STOCKHOLDERS PROPOSALS FOR THE 1997 ANNUAL MEETING OF STOCKHOLDERS
Any stockholder who wishes to present a proposal for action at the
next annual meeting of stockholders and who wishes to have it set forth in the
proxy statement and identified in the form of proxy prepared by the Company must
notify the Company in such manner so that such notice is received by the Company
by February 24, 1997 and in such form as is required under the rules and
regulations promulgated by the Securities and Exchange Commission.
OTHER MATTERS
OFFITBANK, 520 Madison Avenue, New York, New York 10022, serves as an
investment adviser to the Company.
The Board of Directors of the Company knows of no other matters that
are intended to be brought before the Annual Meeting. If other matters, of
which the Board of Directors is not aware, are presented for action, it is the
intention of the proxies named in the enclosed form of proxy to vote on such
matters in their sole discretion.
By order of the Board of Directors,
/s/ LEON F. FIORENTINO
Leon F. Fiorentino
Secretary
June 24, 1996
9
<PAGE>
PROXY MILWAUKEE LAND COMPANY
- --------------------------------------------------------------------------------
ANNUAL MEETING OF STOCKHOLDERS--AUGUST 6, 1996
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints EDWIN JACOBSON, LEON F. FIORENTINO and LAWRENCE
S. ADELSON and each or any of them, as proxies, with full power of
substitution, to vote all shares of Common Stock of MILWAUKEE LAND COMPANY
represented by this proxy which the undersigned is entitled to vote at the
Annual Meeting of Stockholders to be held on August 6, 1996, and at any
adjournments thereof, with all powers the undersigned would possess if
personally present at such meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1 AND 2
1. Election of Director
Edwin JacobsonFOR [_]WITHHOLD AUTHORITY [_]
2. Ratification of selection of Ernst & Young LLP as the Company's independent
auditors.
FOR [_]AGAINST [_]ABSTAIN [_]
3. In their sole discretion on any other matters properly coming before the
meeting or any adjournment or adjournments thereof.
(Please DATE AND SIGN on the reverse side and return promptly in the enclosed
envelope.)
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR THE NOMINEE LISTED IN PROPOSAL 1, FOR PROPOSAL 2 AND IN THE SOLE
DISCRETION OF THE PROXIES UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE
THE MEETING OR ANY ADJOURNMENT OR ADJOURNMENTS THEREOF.
Dated _________________________, 1996
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Signature
IMPORTANT: PLEASE DATE AND SIGN EXACTLY AS YOUR NAME APPEARS HEREON. WHEN
SIGNING AS EXECUTOR, ADMINISTRATOR, TRUSTEE, AGENT, ATTORNEY, GUARDIAN,
OR CORPORATE OFFICER, PLEASE SET FORTH YOUR FULL TITLE. JOINT OWNERS
SHOULD EACH SIGN.
