SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[x] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2)
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
RJR Nabisco Holdings Corp.
(Name of Registrant as Specified In Its Charter)
RJR Nabisco Holdings Corp.
(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), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[ ] $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
[ ] 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:
PRELIMINARY REVOCATION
OF CONSENT STATEMENT
--SUBJECT TO COMPLETION--
RJR NABISCO HOLDINGS CORP.
1301 Avenue of the Americas
New York, N.Y. 10019
(212) 258-5600
REVOCATION OF CONSENT STATEMENT
BY BOARD OF DIRECTORS IN
OPPOSITION TO BROOKE GROUP LTD.
November [__], 1995
Dear Stockholder:
This Preliminary Revocation of Consent Statement (the "Consent
Revocation Statement") is furnished by the Board of Directors (the "Board") of
RJR Nabisco Holdings Corp., a Delaware corporation (the "Company"), to the
holders of outstanding shares of the Company's Common Stock, par value $.01
per share (the "Common Stock"), the Company's Series C Conversion Preferred
Stock, par value $.01 per share (the "PERCS"), and the Company's ESOP
Convertible Preferred Stock, par value $.01 per share and stated value $16 per
share (the "ESOP Preferred Stock" and, collectively with the Common Stock and
the PERCS, the "Capital Stock") in connection with the Board's opposition to
the solicitation (the "LeBow/Icahn Solicitation") by Brooke Group Ltd.
("Brooke Group"), a company controlled by Bennett S. LeBow ("LeBow"), and with
the support of Carl C. Icahn ("Icahn") (collectively, the "LeBow/Icahn
Group"), of written stockholder consents, pursuant to a Consent Statement (the
"Consent Statement") dated November [__], 1995.
Each share of Common Stock, PERCS and ESOP Preferred Stock,
voting together as a single class, entitles the record date holder thereof to
one vote, one-fifth of a vote and one-fifth of a vote, respectively, on the
matters presented for consideration and action by the stockholders.
THE BOARD UNANIMOUSLY OPPOSES THE LEBOW/ICAHN GROUP
SOLICITATION. THE BOARD URGES YOU NOT TO SIGN ANY BLUE CONSENT CARDS SENT TO
YOU BY THE LEBOW/ICAHN GROUP.
IF YOU HAVE PREVIOUSLY SIGNED AND RETURNED ANY SUCH CONSENT
CARD TO THE LEBOW/ICAHN GROUP, YOU HAVE EVERY RIGHT TO CHANGE YOUR MIND.
THE BOARD URGES YOU TO SIGN, DATE AND MAIL THE ENCLOSED YELLOW REVOCATION
OF CONSENT CARD IN THE POSTAGE-PAID ENVELOPE PROVIDED.
EVEN IF YOU HAVE NOT PREVIOUSLY SIGNED AND RETURNED ANY SUCH
CONSENT TO THE LEBOW/ICAHN GROUP, YOU MAY SEND A YELLOW REVOCATION OF CONSENT
CARD TO THE COMPANY, WHICH WILL HAVE NO LEGAL EFFECT BUT WOULD ASSIST US IN
MONITORING THE PROGRESS OF THE CONSENT SOLICITATION.
IF YOUR SHARES ARE HELD IN THE NAME OF A BANK, BROKER OR OTHER
NOMINEE, ONLY YOUR BANK, BROKER OR NOMINEE CAN VOTE YOUR SHARES AND ONLY
PURSUANT TO YOUR SPECIFIC VOTING INSTRUCTIONS. ACCORDINGLY, YOU ARE URGED TO
REJECT THE LEBOW/ICAHN SOLICITATION BY SIGNING, DATING AND RETURNING THE
ENCLOSED YELLOW CONSENT REVOCATION CARD PROMPTLY, USING THE ACCOMPANYING
POSTAGE-PAID ENVELOPE PROVIDED BY YOUR BANK, BROKER OR NOMINEE.
If you have any questions about revoking your consent or require
assistance, please call:
D. F. KING & CO., INC. or MACKENZIE PARTNERS, INC.
77 WATER STREET 156 FIFTH AVENUE - 9TH FLOOR
NEW YORK, NY 10005 NEW YORK, NY 10010
(212) 269-5550 (COLLECT) (212) 929-5500 (COLLECT)
OR OR
CALL TOLL FREE 1-800-290-6430 CALL TOLL FREE 1-800-322-2885
LEBOW/ICAHN IMMEDIATE SPIN-OFF PROPOSAL
In a poorly timed and ill-conceived attempt to force an
immediate spin-off of your Company's remaining equity interest in Nabisco
Holdings Corp. ("Nabisco"), the LeBow/Icahn Group has commenced a consent
solicitation. If we reject its demands, the LeBow/Icahn Group also has
threatened to seek the election of its own hand-picked nominees to replace
your existing Board of Directors at the Company's next Annual Meeting of
stockholders.
WE STRONGLY URGE YOU TO REFRAIN FROM SIGNING OR RETURNING ANY
OF THE BLUE CONSENT CARDS OR OTHER DOCUMENTS SENT TO YOU BY THE LEBOW/ICAHN
GROUP OR THEIR AGENTS. PLEASE CONSIDER THE FOLLOWING:
The Board of Directors is already committed to effecting a
spin-off of Nabisco. The Board has been and continues to be committed to a
spin-off of Nabisco. We also believe that a majority of our stockholders
agree that a spin-off of Nabisco is an attractive option. The Board's
commitment to a spin-off of Nabisco is premised on the fact that, in order for
such a spin-off to be advisable, it must be both in the best interests of the
Company's stockholders and consistent with the Company's public commitments.
The Company has taken significant steps over the past several
years to prepare itself for, and to preserve its ability to effect, a possible
spin-off of Nabisco. When the time comes, the Company will be in a position
to move quickly to effect the spin-off of Nabisco.
This is not the time to effect an immediate spin-off of
Nabisco. For a spin-off to be in the best interests of stockholders, (i) it
must be tax-free, (ii) it must be accomplished in a manner that avoids long
litigation delays and the resulting uncertainty and (iii) it must preserve the
financial integrity of both our food and tobacco businesses. In consultation
with its independent financial, tax and legal advisors, the Board has
carefully considered a spin-off of Nabisco for more than one year and has
studied all of its ramifications. The Board has concluded that effecting a
spin-off at this time would not be in the best interests of the Company's
stockholders and would subject the Company and its stockholders to unacceptable
risks.
Potential litigation by tobacco claimants. The Board believes
that, in the face of the current litigation situation involving the entire
tobacco industry, an announcement of a spin-off at this time could cause great
damage to the Company. Indeed, on November 4, 1995, The New York Times
reported that a spokesperson for a consortium of plaintiffs' lawyers who have
mounted a class action against the tobacco companies stated that the Company
"will absolutely be hit with an injunction" if the Company tries to spin off
Nabisco at this time.(1) Moreover, even if no injunction is obtained, in the
current environment these plaintiffs can be expected to pursue claims
attacking the spin-off for years, placing a cloud over the validity of the
transaction and depressing the value of the stocks of both the Company and
Nabisco. Such litigation would not only be damaging to the Company and the
spun-off food company, but also could involve claims directly against the
Company's stockholders.
- -----------
(1) Excerpt from article by Glenn Collins. No permission has been sought or
received to quote from, or refer to, published materials cited in this
Consent Revocation Statement.
Other Potential Claims. The announcement of an immediate
spin-off of Nabisco could also subject the Company to potential lawsuits from
purchasers and sellers of its securities who have relied on the Company's
public commitments not to spin off Nabisco prior to December 31, 1996, and not
to spin off Nabisco prior to December 31, 1998 if the spin-off would cause the
senior debt of either the Company or Nabisco to be rated below investment
grade. The Board made these public commitments in order to permit the Company
to pursue the major restructuring initiatives it has achieved over the past
year, while maintaining investment grade ratings for its senior debt. These
commitments enabled the Company to establish a regular quarterly cash dividend
of $1.50 per share on an annualized basis, and to segregate the debt of
Nabisco from the other debt of the Company. The Company believes that these
transactions have benefitted stockholders by enabling them to receive a cash
return on their investment and permitting the Company to reduce its aggregate
cost of capital. Importantly, these public commitments and transactions also
have laid the groundwork for a spin-off of Nabisco at such time as the
spin-off can be achieved on a basis that is in the best interests of the
stockholders. The Board believes that abrogating these public commitments of
the Company would be improper and clearly not in the best interests of the
Company's stockholders.
In sum, after many months of consultation with independent
financial, tax and legal advisors, the Board has determined that an immediate
separation of the stockholders' equity interest in our food and tobacco
businesses, as proposed by the LeBow/Icahn Group, would be imprudent and
irresponsible. Although the Company is committed to effecting a spin-off of
its remaining interest in the Nabisco shares at a time when the spin-off can be
consummated in a manner that is in the best interests of stockholders, we must
oppose the poorly timed and imprudent actions proposed by the LeBow/Icahn
Group. The Board of Directors urges you to reject the LeBow/Icahn Group's
requests for your consent.
WHO ARE MESSRS. LEBOW AND ICAHN?
In our opinion, Messrs. LeBow and Icahn are poorly qualified to
suggest significant change at your Company. They are best known for their
corporate raids financed largely by "junk bonds" and "greenmailing" activities
at the expense of other stockholders in the 1980s. In recent years, both have
been involved with highly visible corporate bankruptcies.
You should know that, earlier this year, The New York Times
reported "Mr. LeBow is not a favorite of public [company] shareholders, who
have accused him of emptying companies he controls of their cash and assets.
Brooke [Group, one of LeBow's public companies,] has poured millions of
dollars into the LeBow family coffers through its purchase of assets
controlled by Mr. LeBow. And it has financed his high-flying lifestyle with
loans and unsecured credit lines amounting to millions of dollars."(2)
Indeed, Brooke Group was labelled by Fortune magazine as the "least admired"
company in America in 1994(3), and Mr. LeBow in that year settled claims by
Brooke Group shareholders who contended that he received improper loans from
the company.
Not surprisingly, Mr. LeBow has already proposed a transaction
to the Company that would benefit him at the expense of the Company's other
stockholders. In May 1995, he proposed a transaction pursuant to which,
following the spin-off of Nabisco, the Liggett Group Inc. tobacco subsidiary
("Liggett") of Brooke Group would merge with the Company. The proposal
contemplated that, in exchange for Liggett, a company which in 1994 had net
income of less than $16 million and had at December 31, 1994 approximately
$190 million in debt, Brooke Group would receive 20% of the common stock and
$350 million of preferred stock of the merged company, and the right to
appoint all of the members of the merged company's board of directors.
Similarly, Mr. Icahn is a well-known corporate predator with a
history of purchasing shares in corporations and obtaining a significant
profit for himself. Under Mr. Icahn's stewardship, Trans World Airlines, Inc.
ended up in bankruptcy. Mr. Icahn's interest in the LeBow/Icahn Solicitation
is clear. According to the LeBow/Icahn Consent Statement, Mr. Icahn is
entitled to 20% of any profits on the Common Stock of the Company held by one
of Mr. LeBow's subsidiaries. Given Mr. Icahn's history as a corporate
predator, do you think Mr. Icahn's interest in the long-term health of the
Company is the same as yours?
Remember, unlike your Board, neither Mr. LeBow nor Mr. Icahn
has any fiduciary duties toward you. They are free to pursue their own
personal and selfish agenda for your Company by any means available to them.
As indicated by the LeBow/Icahn Solicitation, they are willing to run a
high-stakes gamble with your money.
LEBOW/ICAHN PROPOSALS TO AMEND THE COMPANY'S BY-LAWS
The LeBow/Icahn Group has also proposed amendments to the
Company's By-laws to (i) reinstate a provision providing that special meetings
of the Company's stockholders shall be called by the Chairman or the Secretary
if requested in writing by holders of not less than 25% of the Company's
Common Stock and (ii) delete a newly added provision establishing procedures
governing action by written consent of stockholders without a meeting.(4)
The Board eliminated the special meeting provision from, and
added the consent administration procedures to, the Company's By-laws in
August, after the Company rejected Mr. LeBow's proposal to merge Liggett Group
with the Company's tobacco operations, and after Mr. LeBow filed for clearance
under the Hart-Scott-Rodino Act of 1976, as amended, to acquire up to 15% of
the Company's Common Stock. The LeBow/Icahn Group has attempted to portray
the Board's action as impairing stockholders' ability to hold a referendum on
a spin-off. Since the Company's By-laws already permit holders of a majority
of the vote represented by the Company's Capital Stock to take action by
written consent at any time -- as evidenced by the LeBow/Icahn Solicitation --
this portrayal is unpersuasive and hides the true intentions of the
LeBow/Icahn Group.
- ----------
(2) Quoted from an article by Stephanie Strom, in The New York Times, August
30, 1995.
(3) Taken from an article by Tricia Welsh in Fortune, February 7, 1994.
(4) The LeBow/Icahn Group also proposed the repeal of all provisions of, or
amendments to, the By-laws adopted by the Board after October 31, 1995.
As no such amendments have been made, this proposal is moot.
In seeking to permit holders of 25% of the Company's Common
Stock to require a special meeting to be called, the LeBow/Icahn Group is
seeking the power to precipitate a change in control or fundamental policy, at
any time of its choosing, without having to obtain the support of holders of a
majority of the vote represented by the Company's Capital Stock. The sole
rationale for the LeBow/Icahn Group's preference for being able to take action
at a special meeting rather than by written consent, is that it might be able
to "win" a vote of stockholders at a special meeting without a majority vote
of the outstanding Capital Stock. In contrast, the written consent procedure
does not allow the LeBow/Icahn Group to "win" without the support of a true
majority of the votes represented by the Company's outstanding Capital Stock.
What are the intentions of the LeBow/Icahn Group? Stockholders
should question whether the LeBow/Icahn Solicitation is only the first step
in a scheme to seize control of the Company with no guarantee of a spin-off of
Nabisco or any other transaction that would benefit stockholders. The
LeBow/Icahn Group has promised to nominate a slate of directors for election
at the Company's next Annual Meeting of stockholders. Although these
directors may publicly state that they are committed to an immediate spin-off
of Nabisco, there is no guarantee that they would, or could, effect such a
spin-off.
This question relates directly to the LeBow/Icahn Group's
proposed amendment to the By-laws. If a small group of dissident stockholders
wants to take control of a corporation by changing the stockholder-elected
board of directors prior to the next regular annual meeting of stockholders,
it may do so in several ways. One alternative -- which is available only if
that group is able to require a special meeting to be held -- is for the
dissident group to solicit proxies for a special meeting of stockholders, in
which case it could propose to expand the size of the board of directors and
nominate a slate of directors that would constitute a majority of the
newly-constituted board. A second alternative is for the dissident group to
solicit written consents, as the LeBow/Icahn Group is doing now.
At a special meeting of stockholders, just as at the annual
meeting, only a plurality of the voting shares -- which may be as low as one
share more than 25% of the shares outstanding -- is necessary to wrest control
of the corporation. This is in contrast to the written consent solicitation
procedure, which requires a true majority of the outstanding voting shares.
The Board believes that, other than at the regular Annual Meeting of the
Company's stockholders, control of the Company should change only if it is
supported by holders of a majority of the votes represented by the Company's
Capital Stock. The Board also believes that it is in the best interests of
the Company's stockholders to prohibit a small, dissident group of
stockholders from requiring a special meeting to be held without the support
of a majority vote of the Company's Capital Stock.
For these reasons, the bylaws of many large public companies
require the consent of a majority of the shares to force the company to call a
special meeting, just as the law requires a majority of the shares to change
control through the consent process. In fact, even the bylaws of Mr. LeBow's
Brooke Group, and its publicly held affiliate, New Valley Corporation, require
50% and a majority, respectively, of the shares to call a special meeting.
In the case of Brooke Group, where Mr. LeBow owns more than 50% of the common
stock outstanding, every other stockholder is effectively precluded from
calling a special meeting.
The By-law that the LeBow/Icahn Group is seeking to reinstate
prevents it from taking control of the Company without the support of a true
majority of the Company's outstanding Capital Stock. We believe that the
LeBow/Icahn Group is attacking this By-law because it believes that the
holders of a majority of votes represented by the outstanding Capital Stock do
not support turning control of the Company over to the LeBow/Icahn Group or
its designees.
Administrative procedures. The Board believes all participants
in a consent solicitation, as well as all stockholders, should understand in
advance the procedures that would be followed in the event of any consent
solicitation. The procedures set forth in Section 9 of Article I of the
By-laws, labelled by the LeBow/Icahn Group as "burdensome new conditions," are
designed simply to ensure a fair and orderly process. They include (i)
procedures for setting a record date for determining which stockholders are
entitled to execute consents, (ii) a procedure for stockholders to follow in
delivering consents, (iii) a requirement that the Company engage a nationally
recognized independent inspector of election to perform a ministerial review
of the validity of properly delivered consents and (iv) a delay in the
effectiveness of consents until completion of the independent inspector's
review. Stockholders should consider whether the LeBow/Icahn Group is truly
objecting to these administrative procedures for the stockholders' benefit or
for the covert purpose of assisting its scheme to wrest control of the Company.
The Board of Directors opposes the LeBow/Icahn Group's
proposals to amend the By-Laws, and urges you to reject its request for your
consent.
THE CONSENT PROCEDURE
The record date for determination of the stockholders of the
Company entitled to execute, withhold or revoke consents relating to the
LeBow/Icahn Solicitation is November __, 1995 (the "Record Date"). Under
Delaware law, in order for the LeBow/Icahn Solicitation to succeed, the
LeBow/Icahn Group must obtain the unrevoked consents to each of its proposals
from the holders of record of a majority of the votes represented by the
Capital Stock outstanding on the Record Date. Thus, an abstention from voting
or a broker non-vote will have the practical effect of a vote against the
LeBow/Icahn Solicitation. A stockholder may revoke any previously signed
consent by signing, dating and returning a YELLOW Revocation of Consent Card.
As of the Record Date, there were [______] shares of Common Stock, [_______]
shares of PERCS and [_______] shares of ESOP Preferred Stock outstanding.
With each class of the Capital Stock voting together as one class, the
respective votes of the classes of the Capital Stock are counted as follows:
each share of Common Stock is entitled to one vote per share, each share of
PERCS is entitled to one-fifth of a vote per share, and each share of ESOP
Preferred Stock is entitled to one-fifth of a vote per share.
Under Section 228 of the General Corporation Law of the State
of Delaware, in order to be effective, consents must be delivered within 60
days of the earliest dated consent delivered to the Company. The earliest
dated consent was delivered to the Company on November [__], 1995.
Accordingly, any consent dated or delivered to the Company after January [__],
1996 will not be valid.
Article I, Section 9 of the Company's By-laws establishes a
mechanism to ensure that consent solicitations are conducted in a fair and
orderly manner. As contemplated by Section 9, in the event of delivery of
written consents to the Company pursuant to the LeBow/Icahn Solicitation, in
the manner specified by the By-laws, the Company will retain a nationally
recognized independent inspector of elections (the "Inspector") for the
purpose of promptly performing a ministerial review of the validity of the
consents and any related revocations in connection with the LeBow/Icahn
Solicitation.
For purpose of permitting the Inspector to perform such review,
no action by written consent without a meeting shall be effective until such
date as the Inspector certifies to the Company that the consents delivered to
the Company in accordance with Article I, Section 9 of the By-Laws represent
at least the minimum number of votes that would be necessary to take the
corporate action. Notwithstanding, the Board and/or any stockholder shall be
entitled to contest the validity of any consent or revocation thereof, whether
before or after such certification by the Inspector, or to take any other
action (including, without limitation, the commencement, prosecution or
defense of any litigation with respect thereto, and the seeking of injunctive
relief in such litigation).
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information, as of the
Record Date, regarding the beneficial ownership of (i) Common Stock and (ii)
Class A Common Stock, par value $.01 per share, of Nabisco, by each director
of the Company, by each of the five most highly compensated executive officers
of the Company during this fiscal year,(5) and each associate of any such
director or officer, and by all directors and executive officers of the
Company as a group. Nabisco was a wholly owned indirect subsidiary of the
Company prior to the January 1995 initial public offering by Nabisco of its
Class A Common Stock. As of the Record Date, the Company indirectly owned all
213,250,000 shares of Nabisco Class B Common Stock outstanding which
represents approximately 80.5% of the economic interest in Nabisco and
approximately 97.6% of the combined voting power of all classes of Nabisco
voting stock. Except as otherwise noted, the persons named in the table below
do not own any other Capital Stock of the Company or Nabisco and have sole
voting and investment power with respect to all shares shown as beneficially
owned by them.
<TABLE>
<CAPTION>
NUMBER OF SHARES OF
NUMBER OF SHARES NABISCO CLASS A
OF COMMON STOCK PERCENT OF COMMON STOCK PERCENT OF
BENEFICIALLY OWNED COMMON BENEFICIALLY OWNED NABISCO CLASS A
NAME OF BENEFICIAL OWNER (1) STOCK (1)(3) COMMON STOCK
- ------------------------------ ------------------- -------------- --------------------- -----------------
<S> <C> <C> <C> <C>
John T. Chain, Jr. (2)........ 8,393 * 1,000 *
Julius L. Chambers (2)........ 6,393 * 0 *
John L. Clendenin (2)......... 6,846 * 500 *
Steven F. Goldstone .......... 0 * 0 *
H. John Greeniaus (2)......... 126,308 * 10,100 *
Ray J. Groves (2)............. 7,000 * 1,000 *
Charles M. Harper (2)......... 524,882 0.1920 71,429 0.1380
James W. Johnston (2)(5)...... 114,381 * 1,000 *
John G. Medlin, Jr. (2)....... 7,259 * 1,000 *
Rozanne L. Ridgway (2)........ 6,393 * 0 *
Andrew J. Schindler (2)....... 28,891 * 0 *
All Directors and Officers
as a Group (2)(4)............. 1,335,295 0.4883% 92,229 0.1782%
<FN>
<F1>
(5) Item 5(a) of Schedule 14A of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), requires that the Company disclose the
securities ownership of its directors and executive officers as of the
beginning of the last fiscal year. Item 6(d) of Schedule 14A and Items 403(b)
and 402(a)(3) of Regulation S-K of the Exchange Act require that the Company
disclose the securities ownership of its five most highly compensated
executives as of the end of the last fiscal year. Item 402(a)(3)(iii) also
requires that the Company update such disclosures with the securities
ownership of two more executives who are currently among the Company's five
most highly compensated executives, but did not fall within the group of the
Company's five most highly compensated executives at the end of the last fiscal
year. Because several directors and executive officers of the Company have
resigned since the end of the last fiscal year, and in order to make the
following table easier to read, the Company has included only the beneficial
ownership of the current directors and executive officers in such table. The
Company has, however, complied with its obligations under the Exchange Act by
disclosing in the footnotes to this table the beneficial ownership of the
Common Stock by the directors and executive officers who served in such
capacities at the beginning and the end, respectively, of the last fiscal year
but no longer serve in such capacities.
</FN>
</TABLE>
* Less than 0.1%
(1) For purposes of this table, a person or group of persons is deemed to
be the "beneficial owner" of any shares that such person has the
right to acquire within 60 days. For purposes of computing the
percentage of outstanding shares held by each person or group of
persons named above on a given date, any security that such person or
persons has the right to acquire within 60 days is deemed to be
outstanding, but is not deemed to be outstanding for the purpose of
computing the percentage ownership of any other person.
(2) The number of shares of Common Stock beneficially owned includes (i)
6,393 shares subject to currently exercisable options granted to each
of Gen. Chain, Messrs. Chambers and Clendenin and Ms. Ridgway; 6,000
shares and 393 shares respectively subject to currently exercisable
options granted to each of Messrs. Groves and Medlin; 462,500 and
629,699 shares subject to currently exercisable options granted to
Mr. Harper and all directors and executive officers as a group,
respectively; and (ii) 272, 160, 274, 271 and 2,466 shares of Common
Stock currently issuable on conversion of shares of ESOP Preferred
Stock owned by, respectively, Messrs. Greeniaus, Harper, Johnston,
Schindler and all directors and executive officers as a group.
(3) No director or officer of the Company holds any options exercisable
within 60 days to acquire shares of Nabisco Class A Common Stock.
(4) On March 14, 1995, Kohlberg Kravis Roberts & Co. LLP ("KKR") sold all
of its then remaining holdings in the Company. James H. Greene, Jr.,
Henry R. Kravis, Paul E. Raether, Clifton S. Robbins, George R.
Roberts, Scott M. Stuart, and Michael T. Tokarz previously served on
the Board as representatives of KKR. Messrs. Greene, Kravis,
Raether, Robbins, Roberts, Stuart and Tokarz (the "KKR Directors")
did not run for reelection at the Company's Annual Meeting of
Stockholders held on April 12, 1995. Their respective terms in
office expired effective as of that date. The Company cannot
independently verify the exact nature of their current holdings in
the Company because they are no longer subject to the disclosure
requirements of Section 16(a) of the Exchange Act, discussed below.
However, their last Section 16(a) filings with the Securities and
Exchange Commission (the "SEC") dated as of April 7, 1995 indicate
that, as of that date, none of the KKR Directors had any beneficial
ownership in the Capital Stock of the Company.
(5) The outstanding shares of Common Stock shown as beneficially owned by
Mr. Johnston include 12,000 shares held in trust for the benefit of
Mr. Johnston's children, as to which Mr. Johnston disclaims
beneficial ownership.
(6) Lawrence R. Ricciardi retired as both an executive officer and a
director of the Company effective March 3, 1995. Mr. Ricciardi is no
longer subject to the disclosure requirements of Section 16(a) of the
Exchange Act. Therefore, the Company cannot independently verify Mr.
Ricciardi's current stock ownership. As of September 3, 1995, Mr.
Ricciardi beneficially owned 407,845 shares of Common Stock of the
Company.
(7) Eugene R. Croisant retired as an executive officer of the Company
effective March 3, 1995. Mr. Croisant is no longer subject to the
disclosure requirements of Section 16(a) or the Exchange Act.
Therefore, the Company cannot independently verify Mr. Croisant's
current stock ownership. As of September 3, 1995, Mr. Croisant
beneficially owned 324,597 shares of Common Stock of the Company.
Section 16(a) of the Exchange Act requires the Company's
officers and directors, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file initial
statements of beneficial ownership (Form 3), and statements of changes in
beneficial ownership (Forms 4 and 5), of Common Stock and other equity
securities of the Company with the SEC and The New York Stock Exchange, Inc.
Officers, directors and greater than ten-percent stockholders are required by
SEC regulation to furnish the Company with copies of all such forms they file.
Based solely on its review of the copies of such forms received
by it, or written representations from certain reporting persons that no
additional forms were required for those persons, the Company believes that
during 1994 and 1995 all filing requirements applicable to its officers,
directors, and greater than ten-percent beneficial owners were complied with.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information, as of the
Record Date, regarding the beneficial ownership of persons known to the
Company to be the beneficial owners of more than five percent of any class of
the Company's voting securities. The information was obtained from Company
records and information supplied by the stockholders, including information on
Schedules 13D and 13G and Forms 3, 4 and 5 provided to the SEC. Except as
otherwise noted, the persons named in the table below have sole voting and
investment power with respect to all shares shown as beneficially owned by
them.
<TABLE>
<CAPTION>
NUMBER OF SHARES
NAME AND ADDRESS OF BENEFICIAL BENEFICIALLY PERCENT OF
-------------------------------------- ------------------ ------------
TITLE OF CLASS OWNER OWNED CLASS
- -------------------------- -------------------------------------- ------------------ ------------
<S> <C> <C> <C>
Common Stock FMR Corp.(1).......................... 35,339,023 13.02%
82 Devonshire Street
Boston, MA 02109
Common Stock Wachovia Corporation(2)............... 13,206,894 5.50%
301 North Main Street
Winston-Salem, NC 27150-3099
Series C College Retirement Equities Fund(3)... 17,826,800 7.13%
Conversion 730 Third Avenue
Preferred Stock New York, NY 10017
Series C Brinson Partners, Inc.(4)............. 17,453,100 7.00%
Conversion 209 South LaSalle
Preferred Stock Chicago, IL 60604-1295
Series C The Prudential Insurance Company 16,802,050 6.80%
Conversion of America(5).......................
Preferred Stock Prudential Plaza
Newark, NJ 07102-3777
ESOP Convertible Wachovia Bank of North Carolina, 15,187,141 100%
Preferred Stock N.A.(6)
Box 3075, Trust Operations
Winston-Salem, NC 27102
Nabisco Class A Janus Capital Corporation(7) 4,472,875 9.90%
Common Stock 100 Fillmore Street, Suite 300
Denver, CO 80206-4923
Nabisco Class A Tiger Management Corporation(8) 9,145,300 17.7%
Common Stock 101 Park Avenue
New York, NY 10178
</TABLE>
(1) According to Amendment No. 1 to Schedule 13G dated February 13, 1995
jointly filed by FMR Corp. and Edward C. Johnson 3d, Chairman of FMR
Corp. and a member of a controlling group with respect to FMR Corp.,
the 35,339,023 shares of the Common Stock shown as beneficially owned
by FMR Corp. and Mr. Johnson as of December 31, 1994 include (i)
32,551,043 shares beneficially owned by Fidelity Management &
Research Company, a registered investment adviser and wholly owned
subsidiary of FMR Corp., as a result of acting as investment adviser
to several registered investment companies that own such shares (the
"Fidelity Funds"), (ii) 2,712,180 shares beneficially owned by
Fidelity Management Trust Company ("Fidelity Trust"), a bank and
wholly owned subsidiary of FMR Corp., as a result of serving as
investment manager of institutional accounts, (iii) 10,400 shares
owned directly by Mr. Johnson or in trusts for the benefit of Mr.
Johnson or a member of his family and (iv) 65,400 shares beneficially
owned by Fidelity International Limited ("Fidelity International"),
an investment adviser of which Mr. Johnson is also Chairman and a
member of a controlling group, but which is managed independently
from FMR Corp. Each of FMR Corp. and Fidelity International disclaim
beneficial ownership of shares beneficially owned by the other.
According to the Schedule 13G, FMR Corp. and Mr. Johnson also
beneficially own 5,165,800 shares of Series C Preferred Stock as a
result of (i) the Fidelity Funds owning 4,071,700 Series C Depositary
Shares and (ii) the institutional accounts managed by Fidelity Trust
owning 1,094,100 Series C Depositary Shares. According to the
Schedule 13G, (a) FMR Corp. and Mr. Johnson each has sole investment
power, but neither has sole voting power over the shares owned by the
Fidelity Funds, (b) FMR Corp. and Mr. Johnson each has sole
investment power over all of, has sole voting power over certain of,
and has no voting power over the remainder of, the shares owned by
the institutional accounts managed by Fidelity Trust and (c) Mr.
Johnson has sole voting and investment power over certain of, has
shared voting and investment power over certain of, and has no voting
or investment power over the remainder of, the shares owned directly
by him or in family trusts. All of the figures in this footnote
related to holdings of the Common Stock have been revised to reflect
a one-for-five split of the Common Stock which occurred on April 12,
1995.
(2) According to the Schedule 13G dated February 14, 1994 jointly filed
by the Wachovia Corporation (the "Wachovia Corp.") and the Wachovia
Bank of North Carolina, N.A. (the "Wachovia Bank") (collectively, the
"Wachovia Group"), as of December 31, 1994, the Wachovia Group
beneficially owned an aggregate of 13,206,894 shares of the Common
Stock as a result of direct or shared voting or investment discretion
over such shares. All of the figures in this footnote have been
revised to reflect a one-for-five split of the Common Stock which
occurred on April 12, 1995.
(3) College Retirement Equities Fund, a registered investment company,
beneficially owned 17,826,800 shares of Series C Preferred Stock as
of December 31, 1994 as a result of its beneficial ownership of
17,826,800 Series C Depositary Shares as reported in its Schedule 13G
dated February 10, 1995.
(4) According to the Schedule 13G dated February 10, 1995 jointly filed
by Brinson Partners, Inc. ("Brinson Partners"), Brinson Trust Company
("Brinson Trust") and Brinson Holdings, Inc. ("Brinson Holdings"), as
of December 31, 1994 (i) Brinson Partners, a registered investment
adviser and wholly owned subsidiary of Brinson Holdings, beneficially
owned 12,385,600 shares of Series C Preferred Stock as a result of
its beneficial ownership of 12,385,600 Series C Depositary Shares and
(ii) Brinson Trust, a bank and wholly owned subsidiary of Brinson
Partners, beneficially owned 5,067,500 shares of Series C Preferred
Stock as a result of its beneficial ownership of 5,067,500 Series C
Depositary Shares.
(5) According to the Schedule 13G dated March 10, 1995 filed by The
Prudential Insurance Company of America ("Prudential"), Prudential
beneficially owned an aggregate of 16,802,050 shares of Series C
Preferred Stock as of December 31, 1994 as a result of having shared
voting and investment discretion over 16,802,050 Series C Depositary
Shares which were held for the benefit of its clients.
(6) Wachovia Bank holds the shares of the ESOP Preferred Stock in its
capacity as Trustee of the RJRN Defined Contribution Master Trust.
Under the terms of the Master Trust, Wachovia Bank is required to
vote shares of ESOP Preferred Stock allocated to participants'
accounts in accordance with instructions received from such
participants and to vote allocated shares of ESOP Preferred Stock for
which it has not received instructions and unallocated shares in the
same ratio as shares with respect to which instructions have been
received. Wachovia Bank has no investment power with respect to
shares of ESOP Preferred Stock.
(7) According to Amendment No. 2 to the Schedule 13G dated September 8,
1995 jointly filed by the Janus Capital Corporation ("Janus
Capital"), a registered investment adviser, and Thomas H. Bailey
("Bailey"), President and Chairman of, stockholder in, and thereby, a
control person of Janus Capital, Janus Capital and Bailey beneficially
own 4,472,875 shares of the Nabisco Class A Common Stock as a result
of shared voting and dispositive power over such shares held for the
benefit of its clients. Such beneficial ownership includes 4,169,500
shares of the Nabisco Class A Common Stock, or 9.3% of the Nabisco
Class A Common Stock outstanding, beneficially owned by the Janus
Fund, a registered investment company to which Janus Capital provides
investment advice.
(8) According to Amendment No. 1 to the Schedule 13G dated June 6, 1995
filed jointly by Tiger Management Corporation ("Tiger"), Panther
Partners L.P. ("Panther") and Panther Management Company L.P.
("PMCLP"), and Julian H. Robertson, Jr. ("Robertson") as the ultimate
controlling person of Tiger and PMCLP, (i) Tiger, a registered
investment adviser, beneficially owned 9,145,300 shares of Nabisco
Class A Common Stock, (ii) Panther, a registered investment company,
beneficially owned 744,700 shares of Nabisco Class A Common Stock,
and (iii) PMCLP, a registered investment adviser, beneficially owned
744,700 shares of Nabisco Class A Common Stock. As ultimate
controlling person of Tiger and PMCLP, Robertson beneficially owned
9,890,000 shares of Nabisco Class A Common Stock. According to the
Schedule 13G, Tiger, Panther, PMCLP and Robertson, by virtue of his
controlling interest in Tiger and PMCLP, each possess shared voting
and investment discretion over such shares that they respectively
beneficially own on behalf of their clients.
SOLICITATION OF REVOCATIONS OF CONSENTS
COST AND METHOD
The cost of the solicitation of revocations of consent will be
borne by the Company. The Company estimates that the total expenditures
relating to such solicitation (other than salaries and wages of officers and
employees) will be approximately $[________], of which approximately $[____]
has been spent to date. In addition to solicitation by mail, directors,
officers and other employees of the Company may, without additional
compensation, solicit revocations of consents by mail, in person, by
telecommunication or by other electronic means.
The Company has retained D.F. King & Co., Inc., and MacKenzie
Partners, Inc. at an estimated fee of not more than $[_______], plus
reasonable out-of-pocket expenses, to assist in the solicitation of
revocations. Approximately [__] persons will be utilized by such firms in
their efforts. The Company will reimburse brokerage houses, banks, custodians
and other nominees and fiduciaries for out-of-pocket expenses incurred in
forwarding the Company's consent revocation materials to, and obtaining
instructions relating to such materials from, beneficial owners of Capital
Stock. The Company has also agreed to indemnify D.F. King & Co., Inc. and
MacKenzie Partners, Inc. against certain liabilities and expenses in
connection with their respective engagements, including certain liabilities
under the federal securities laws.
STOCKHOLDER PROPOSALS
Any stockholder who desires to present a proposal to be
considered at the Company's next Annual Meeting may do so, provided that such
stockholder satisfies the eligibility requirements established by the SEC. To
be considered for submission at the meeting, such proposal must be received by
the Company (addressed to the attention of the Secretary) not later than
November 21, 1995. To be submitted at the meeting, any such proposal must be
a proper subject for stockholder action under the laws of the State of
Delaware, and must otherwise conform to the applicable regulations of the SEC
and the Company's By-laws.
Charles M. Harper
Chairman and Chief Executive
Officer
IMPORTANT
1. If your shares are registered in your own name(s), please sign,
date and promptly mail the enclosed YELLOW Revocation of Consent Card, using
the post-paid envelope provided.
2. If you have previously signed and returned a consent card to the
LeBow/Icahn Group, you have every right to change your mind. Only your latest
dated card will count. You may revoke any earlier card to the LeBow/Icahn
Group by signing, dating and mailing the enclosed YELLOW Revocation of Consent
Card in the post-paid envelope provided.
3. If your shares are held in the name of a brokerage firm, bank
nominee or other institution, only it can sign a YELLOW Revocation of Consent
Card with respect to your shares and only after receiving your specific
instructions. Accordingly, please sign, date and mail the enclosed YELLOW
Revocation of Consent Card in the post-paid envelope provided. To ensure that
your shares are voted, you should also contact the person responsible for your
account and give instructions for a YELLOW Revocation of Consent Card to be
issued representing your shares.
4. After signing the enclosed YELLOW Revocation of Consent Card, do
not sign any other cards. Do not even vote "against" on the LeBow/Icahn
Group's blue consent card.
If you have any questions about giving your revocation of consent or
require assistance, please call:
D. F. KING & CO., INC. MACKENZIE PARTNERS, INC.
77 WATER STREET or 156 FIFTH AVENUE - 9TH FLOOR
NEW YORK, NY 10005 NEW YORK, NY 10010
(212) 269-5550 (COLLECT) (212) 924-5500 (COLLECT)
OR OR
CALL TOLL FREE 1-800-290-6430 CALL TOLL FREE 1-800-322-2885
PRELIMINARY--SUBJECT TO COMPLETION
RJR NABISCO HOLDINGS CORP.
THIS REVOCATION OF CONSENT IS SOLICITED ON BEHALF
OF THE BOARD OF DIRECTORS
OF
RJR NABISCO HOLDINGS CORP.
IN OPPOSITION TO THE SOLICITATION BY
BROOKE GROUP LTD.
The undersigned, a holder of shares of Common Stock, par value
$.01 per share, of RJR Nabisco Holdings Corp. (the "Company") and/or a holder
of Series C Conversion Preferred Stock, par value $.01 per share, of RJR
Nabisco Holdings Corp. and/or a holder of ESOP Convertible Preferred Stock,
par value $.01 per share and stated value $16 per share, of RJR Nabisco
Holdings Corp., acting with respect to all shares of such stock which the
undersigned is entitled to vote, hereby acts as follows concerning the
following three proposals of Brooke Group Ltd., a company controlled by
Bennett S. LeBow, and made with the backing of Carl C. Icahn (the "LeBow/Icahn
Group"):
1. The LeBow/Icahn Group non-binding resolution seeking the immediate
spin-off of Nabisco Holdings Corp.:
[ ] REVOKE CONSENT [ ] DO NOT REVOKE CONSENT
THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY RECOMMENDS THAT YOU "REVOKE
CONSENT" AS TO THIS PROPOSAL.
2. The LeBow/Icahn Group proposal to amend the By-laws to give holders
of not less than 25% of the Company's Common Stock the right to
require a special meeting:
[ ] REVOKE CONSENT [ ] DO NOT REVOKE CONSENT
THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY RECOMMENDS THAT YOU "REVOKE
CONSENT" AS TO THIS PROPOSAL.
3. The LeBow/Icahn Group proposal to delete the By-law provisions
establishing certain administrative procedures for action by written
consent:
[ ] REVOKE CONSENT [ ] DO NOT REVOKE CONSENT
THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY RECOMMENDS THAT YOU "REVOKE
CONSENT" AS TO THIS PROPOSAL.
(continued on the reverse side)
(continued from the reverse side)
THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY RECOMMENDS THAT YOU
SIGN, DATE AND MAIL THIS CARD TODAY AND THEREBY REVOKE ANY CONSENT THAT YOU
MAY HAVE GIVEN TO THE LEBOW/ICAHN GROUP. If no direction is made, this
revocation card will be deemed to revoke all previously executed consents. If
you mark any of the boxes "do not revoke consent," any consent you may have
given to that particular proposal of the LeBow/Icahn Group will not be revoked.
Dated: ___________________________, 1995
_______________________________________
(Signature)
_______________________________________
(Signature)
_______________________________________
(Title)
Please sign exactly as name appears
hereon. When shares are held by joint
tenants, both should sign. When
signing as attorney, executor,
administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign in full
corporate name by the president or
other duly authorized officer. If a
partnership, please sign in partnership
name by authorized person. This
revocation card revokes consents with
respect to all shares of Common Stock,
ESOP Conversion Preferred Stock and
Series C Convertible Preferred Stock
held in all capacities.
PLEASE SIGN, DATE AND MAIL THIS CARD TODAY. IF YOU NEED ASSISTANCE, PLEASE
CALL D.F. KING & CO., INC. TOLL FREE AT 1-800-290-6430 OR MACKENZIE PARTNERS,
INC. TOLL FREE AT 1-800-322-2885.
